Pensions and public schools struggle for tax funding
Congress is in recess and returns in two weeks. The Daily Deduction will be back next Monday and resume its regular schedule on Monday, April 28. Until then: Don鈥檛 miss tomorrow鈥檚 TPC event on inequality; outside the Beltway, states and cities鈥� pension and education funding problems persist.
Tomorrow: TPC Tax Day conversation with Thomas Piketty on inequality.聽TPC鈥檚 Len Burman moderates the discussion with the author of聽Capital in the Twenty-First Century, a new book on the long-term evolution of inequality, the concentration of wealth, and prospects for economic growth. Piketty will be joined by Dean Baker of the Center for Economic and Policy Research and Kevin Hassett of the American Enterprise Institute.聽Register 聽or tune in to the live webcast on Tuesday, April 15, at noon.
Rhode Island鈥檚 pension fight heads to trial; lawmakers ask for tax cuts.聽The state聽cannot reach a deal聽on a pension overhaul with聽public employee and retiree groups. Five聽groups voted to approve a settlement in February, but local police officers, the smallest of the groups, voted against it. One of the cash-strapped聽state鈥檚 largest sources of revenue聽comes from its sales tax; two state lawmakers聽聽to reduce it.
Pension worries prompt Wilmington Mayor Dennis Williams to ask for higher property taxes.聽In his first term, the Delaware mayor would like a聽property tax hike聽in order to generate $3.6 million in new revenue. 鈥淭he city has pointed to $2.7 million in 鈥榰ncontrollable costs,鈥� such as contractually required payroll increases and higher pension costs, as reasons for the tax increase,鈥� reports聽The News Journal.
Chicago Mayor Rahm Emmanuel changed his property tax tactics, but to what end?聽The city鈥檚 mayor had hoped Illinois lawmakers would raise property taxes to help fund Chicago鈥檚 pensions,聽but he was rebuked. His revised pension reform plan lets the Chicago City Council decide on property tax increases, 鈥渂ut聽even if the聽General Assembly signs off鈥� and the City Council [raises] property taxes鈥� pensions will 鈥榗ontinue to weigh heavily on the city鈥檚 credit quality,鈥櫬燤oody鈥檚 said,鈥� reports聽The Chicago Sun-Times.
Property taxes aren鈥檛 high enough for Wisconsin voters in some school districts.聽Out of 35 referenda placed on April 1 Wisconsin ballots by school districts, 23 passed, resulting in higher taxes to pay for schools鈥� salaries, utilities and other basic costs, reports the聽Associated Press. Wisconsin voters may be wondering whether property taxes are the fairest way to fund education. 鈥淭he recession forced many states to cut school spending, but in areas where residents were willing and could afford it, district leaders sought referenda.鈥�
Interested in subscribing to聽, the Tax Policy Center summary of the day鈥檚 tax news? Sign-up聽聽for free access. If you鈥檇 like to tell us about a new research paper or have any comments about our new feature, write us at聽dailydeduction@taxpolicycenter.org.
