By Aaron Jeter
Filed Tuesday, January 29, 2008 at 4:45 PM
The following statement is from Congressman Lacy Clay...
On Tuesday, February 5th, voters in the City of St. Louis will be asked to approve a half-cent sales tax increase, allegedly to fund public safety, and police and fire pensions.
As an elected official, a city resident and a home owner, I understand the need to hire more police officers, increase police and firefighter pay, and adequately fund police and fire pensions.
However, as a voter and taxpayer, I think this proposed tax increase deserves a resounding NO!!
In recent years, the City of St. Louis has made a number of financial decisions that have reduced tax revenue.
In 2000, the city eliminated the city earnings tax on stock options, which cost millions in current and future city revenue.
The City of St. Louis continues to give tax abatements and other financial incentives to well-heeled developers for downtown development.
The new stadium, Ballpark Village and the Renaissance Hotel project are just the latest examples of a series of questionable financial decisions that have not delivered expected results.
Instead of a sales tax, we should consider some long-overdue fundamental changes in how our police and fire pension systems operate.
City pension funds have not been restructured in nearly 40 years. Currently, they do not operate like modern pension funds and require the taxpayers to pay 100% of the pension with no employee contributions.
It is estimated that even if the ballot issue passes, the City will face another pension shortfall in 5-7 years.
So this tax increase is just a temporary band-aid that will not produce long-term solvency for the pension funds.
According to the National Association of State Retirement Administrators, a property tax is a more common means to fund pensions than a regressive sales tax, which disproportionately impacts poor people.
While police protection is the City’s single largest annual expenditure, we still refuse to address the issue of local control of the St. Louis Police Department.
So, this new tax creates a unique irony.
St. Louis voters overwhelmingly voted to require police officers to reside in the city.
St. Louis voters still have no control over their own police department.
Yet the police officers totally ignored the wishes of the taxpayers and voters who pay the bills, and went to the state legislature to receive permission to move outside of the City of St. Louis. And they adamantly oppose all efforts to restore local control over the department.
Now we are asked to approve a sales tax increase to help the police who will not have to pay it, whom are no longer required to live in the city, and are not subject to local control,
…I don’t think so.
The fire department has serious problems and deep divisions that have been well chronicled.
The fire pension fund suffers from the same racial animus that is destroying our faith in the fire department and its governance.
Firefighters and retired firefighters choose half of the pension board. Even though 44% of the fire department is African American, only one African American has served on the pension board in its history. He was elected in 1983, and there have been none since. Until we make real progress towards equity and justice regarding promotions in the Fire Department, and proportional representation of African Americans on this pension fund board, we have no choice but to withhold tax increases.
The present administration and leadership of these departments and their unions must get the message that we are dissatisfied with current conditions, and defeating this sales tax increase will force them to make real progress on addressing our concerns.
14 Comments:
Some flaws in this post. First, why should city property owners foot the entire bill? Renters and city visitors also require protection. A sales tax is a much better device to tax the benefitted parties.
Clay wrote: "In 2000, the city eliminated the city earnings tax on stock options, which cost millions in current and future city revenue." This statement is logically suspect. The elimination of the earnings tax on stock options dramatically slowed the exodus of top level employees. If the city had not acted, the city would have still lost the earnings tax on stock options plus all of the earnings tax from the salaries.
Clay wrote: "The City of St. Louis continues to give tax abatements and other financial incentives to well-heeled developers for downtown development." On the other hand, many of these incentives have in fact turned out to be sound
investments. Also, welcome to the 21st Century. Cities have to be competitive and use available tools to attact new residents and jobs.
1/29/2008 6:00 PM
As long the St. Louis Police Department and the St. Louis Board of Police Commissioners refuses to even regognize the Citizens Basic Right even to address matters of concern at Public Board Meetings...
As long as Citizens of the City of St. Louis have no Pro-Active voice in the day to day activities of its own Police Department...
As long as there is no Citizen Oversight of the St. Louis Police Department..
My Vote is NO for any Sales Tax Increase.
BUT I feel that the men and the woman of the St. Louis Police Department DO Deserve a Raise in salary and benefits for their service to the St. Louis Community and the quicker each police officer realizes that we as citizens support their well being, the sooner they should band together to support Civilian Oversight.
Why cain't average John Q. Public Citizen be appointed to the Police Board and not just cronies of well heeled politicians??
It is an insult to the tax payers.
1/29/2008 7:03 PM
I agree 100 percent! Wow, very nice!
1/29/2008 7:14 PM
The defeat of this sales tax will also be a defeat of that damn Slay and for his disrespect of the black community!What is happening with the "investigation" of the theft of $40,000+ from the SLPD's evidence room? Something is rotten at 1300 Clark!
1/29/2008 10:55 PM
Mr.Clay has some very solid arguments against the sales tax which I totally agree with. But really, I can even see through this as just another African - American community vs. Slay issue.
1/30/2008 6:52 AM
I am disappointed in the board's racial makeup being made an issue.
What should be an issue, what kind of green(returns) the fund is getting, but instead, some want it to be a black/white issue.
Ott raises an interesting question, what can/should cities do to retain businesses? I am amenable to TIFs, not to putting the city on the hook, like St. Louis Marketplace and St. Louis Centre.
Lewis Reed was presented as the candidate who could get development to happen. For development to happen, government often has to prime the pump, sometimes by taking other people's land from them and giving to other for profit entities. I don't like it, but it is what it is.
1/30/2008 8:35 AM
Why would I listen to financial advice from Lacy?
Why hasn't State Rep. Nasheed done ANYTHING in Jeff City about City control of the police?
Businesses and citizens are moving into the city for the first time in 50(!!!!) years. But sure Lacy, competing with St. Louis and Charles counties to bring in new businesses is just horrible.
Lacy has always been intellectually lazy and has always played on peoples emotions for support. This is no different. Go home Lacy. You need to spend some time in your district, there are many real problems caused by you that need attention.
Rita Days, please run against this fool. My ears and check book are open for you!
1/30/2008 8:57 AM
Wouldn't a better headline be "Clay Favors Property Tax Increase"?
1/30/2008 3:18 PM
He is wrong about employees not paying in to the pension system. They take 8% of our pay on the fire department before we ever see our check. Also in line with that, maybe Lazy Clay should find out the we do get social security after we retire even if we work secondary and make enough earn it. We get our pension which we DO pay in to and that is it. Maybe the politicians who coninue to cry about this should come ride along on a fire truck or in the back of a police car for a couple of days and then tell me how we don't deserve anything.
1/30/2008 8:22 PM
Why should the burden of the fiscal irresponsibility of the City of St. Louis be placed solely on the shoulders of the men and women of the St. Louis Police and Fire Departments? Is Lacy Clay that disconnected from logical thinking?
Every employee of the Police and Fire Department contributes 8% of their salary to their pension funds. They are not 100% funded by the City as Clay asserts. As a matter of fact, the reason for the City’s indebtedness to the pension funds is due to their own refusal to make contributions as required by State law for the past 10 or so years. Had the City made the contributions as required, they would not have to consider this sales tax increase. Instead, the pension funds sued the City for the owed contributions and were victorious, as ruled by the State Supreme Court.
I will agree with Lacy on this point. It is a band-aid, but it is a band-aid for a self-inflicted wound. Since Lacy attributed some a statement to the National Association of State Retirement Administrators, I will add a few of my own:
“Recent studies have begun to reveal that public pensions have positive effects on local and state economies. In 2006, state and local government retirement systems in the U.S. distributed over $100 billion more in benefits than they received in taxpayer-funded contributions, a figure that is growing each year.”
“One reason why pension plans differ (from those in private industry) is that they cover employees with different employment characteristics. For instance, because police work and fire fighting are physically demanding occupations, retirement benefits for public safety workers typically allow retirement at earlier ages, in part to maintain a younger
workforce. Consequently, the retirement benefits available to police and firefighters are usually different from those provided to teachers or to general employees.”
So you see Lacy, pension plans for Police and Fire can’t be lumped in with every other profession to simply help a fiscally irresponsible city.
This has nothing to do with the racial tension in the Fire Department, or the residency of Police Officers, it has to do with the City’s ability to govern it’s own checkbook.
The City wants the Police Pension System, which is solvent to the amount of about $700 million dollars, to pillage just like it did the City workers pension, the Fire Department pension and any other large investiture it can get its hands on.
1/31/2008 12:51 AM
So will incompetent comptroller "I can't count green" Darlene continue to blame the Mayor and Board of Aldermen or will she finally become accountable for her offices' mismanagement of City money?
I am tired of her blame game. She either cleans up her office or she at least helps the Board President and the Mayor clean it up for her.
1/31/2008 8:59 AM
How dare you talk about our comptroller that way. She is gearing up to run for mayor and needs to blame as many as people as possible for incompetence.
1/31/2008 11:59 PM
FF and PD ONLY pay 8 percent? What a way to milk government, and poor tax payers!
Let's be honest pensions are a thing of the past, and this one in particular is going to bankrupt the city.
The city should offer a retirement savings plan. If you contribute, they'll match 8 percent. NEVER should the tax payer have to pay 92 percent of someones retirement. Pay for your own! Why should you live off the government for free for the rest of your life just because you worked for the government?
Read this article: HOW GOVERNMENT PENSIONS ARE ROBBING YOU
http://money.cnn.com/magazines/moneymag/moneymag_archive/1994/10/01/89168/index.htm
2/01/2008 3:41 PM
You are quoting an article that is 14 years old.
The City does not fund 92% of a public pension. They are required to make a contribution based on an acturial study, that does not come close to 92% of an individuals salary.
When an individual chooses public service, they give up their right to Social Security Benefits. Zilch, nada, unless they choose to work a second job and reach the points required to receive a reduced social security benefit. Anyone else in the private sector is eligible for SS without having to work two or three jobs.
It's difficult to engage in a battle of wits with an unarmed opponent!
2/02/2008 1:38 AM
Post a Comment
<< Home