| A large part of Omaha Mayor Jim Suttle's appeal is that he's supposed to be an engineer rather than a politician. Sadly, it appears he's moving away from that promise with his recent posturing against State Senator Tom White and his bill to exempt certain utility fees from the sales tax.
Although it's broader in construction and would exempt any utilities fees collected for infrastructure replacement, the motive behind White's bill (LB952) is to prevent the double-taxation of Omaha residents who are picking up the tab for a multi-billion dollar sewer improvement project mandated by the federal government. Whether the costs of this federal mandate are considered a true tax or not, the end result is the same for the people who are paying the bill. Recognizing that additional state and local taxes shouldn't be tacked onto these fees, 15 State Senators have already cosponsored White's legislation - most from the Omaha-metro area.
Now, it's important to note that the city of Omaha is in the middle of a budget crisis with no end in sight. Mayor Suttle's faced a terrible predicament in the city's finances since the first day he took office and has so far found little assistance from the Legislature. In fact, Suttle's hope that city voters might be allowed to consider raising the sales tax by an additional half-cent died this year without such a bill even being introduced.
After that rejection, it probably shouldn't surprise that Suttle would resent any action by the Legislature cutting into potential revenue that the city desperately needs. There's a lot to be said for the possibility that any lost revenue is only going to increase the burden on local property owners in the form of higher property taxes. It's this shift onto property taxes that Suttle is struggling to avoid - or, at least, to minimize. Still, in this instance, Suttle is just plain wrong to oppose White's sales tax exemption. Suttle is being petty, short-sighted, and self-serving - all things you'd expect from a politician but not from a man who campaigned on his engineers' approach to problem-solving.
If Suttle were remaining true to this approach, you'd expect him to focus on the numbers. You'd expect him to focus on dollars and cents, while maximizing the benefit for the people of Omaha. Instead, he's willfully blinded himself to any concern but the immediate political consequences of a 3-cent hike in the property tax required to make up the anticipated loss in sales tax revenue.
This is where Suttle appears to be shamelessly turning his back on his training as an engineer and his responsibility to the people of Omaha. With sales taxes, almost four dollars go to the state for every one dollar received by the city of Omaha. Yes, there's long-standing dissatisfaction over high property taxes in Omaha - as is the case all across the state. But, that doesn't mean anyone in their right mind would prefer to pay five dollars to the government in other taxes and fees rather than a single dollar more in local property taxes.
No tax exists in a vacuum. Suttle understood this when he wrote in a letter to White that his bill would really be "a tax shift." This is a familiar argument - and not one wholly without merit. However, the shift away from the sales tax could go towards a number of other potential sources of revenue besides the property tax. The real tax shift in White's bill is geographic - offering relief to Omaha-area taxpayers from an unfair share of state government's expenses. Suttle should recognize that this frees up resources at the local level rather than foolishly embracing a status quo that overburdens his own constituents.
I'm not saying that Suttle would have an easy sell in convincing Omaha taxpayers that other taxes and fees would be acceptable because of this sales tax exemption. But, the numbers don't lie. Dollar-for-dollar, there's no doubt the city and the surrounding communities benefit from keeping that money closer to home rather than sending it off to Lincoln never to be seen again. And, whatever form it takes, we're talking fewer dollars in total tax as well. All it takes is a Mayor able to communicate and to make his case - which Suttle should already be laying the groundwork for rather than going off half-cocked with criticism of White and LB952.
Suttle's attempt to lay any future property tax increase at White's door is an especially disturbing example of internecine warfare in light of fellow Democrat White's campaign for Congress against Republican Lee Terry. This is a gift to Terry, plain and simple. No matter what animosity may exist between Suttle and White, this is a clear betrayal of the many Democrats who've supported both.
To put it back on the path to fiscal responsibility, the city of Omaha needs someone looking at its problems from more than just a political perspective. That's what Suttle promised on the campaign trail, and I still have hope it's what he will deliver. But, right now, he's carrying water for Gov. Dave Heineman, allowing he and his legislative allies to pad the state budget with the people of Omaha's paychecks because it's easier than doing the hard work of leading. Omaha deserves better, and Tom White deserves an apology. |
