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Cahn: The right taxes for the right reasons
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On today’s front page, I report on Tuesday’s Kershaw County Board of School Trustees meeting during which “alternatives” -- scenarios, really -- regarding the impact of this November’s construction-related referenda.

There are two questions. The first will ask voters to approve $138.8 million worth of bond-funded construction projects. The second referendum would ask voters to approve a 1-cent sales tax to offset the necessary millage increase which would be imposed by the $138.8 million construction bond.

I’ve talked to a lot of different people during the last few months about this. Full disclosure: these people included district officials whom I won’t name because we were speaking off the record.

Let’s set aside the entire Bethune-Mt. Pisgah elementary school consolidation issue for the moment. When it comes to financing these projects -- indeed, when it comes to the entire question of funding education in this state -- I believe we have to look at using the right taxes for the right reasons.

For me, the underlying issue is Act 388, which has been in place for a full decade now. Passed and signed into law in 2006, Act 388 shifted a portion of the tax burden for state education funding away from owner-occupied (“primary”) homes to a statewide 1-cent sales tax increase.

This was a huge mistake and if you check the archives of other newspapers around the state, you’ll see many of my fellow editors agree with me.

When it comes to statewide funding of education, property taxes are a much more stable, long-term revenue stream. Sales taxes fluctuate too wildly to consistently pay for the ever-increasing cost of education in our state. Worse, during the years-long economic downturn which followed pretty closesly on Act 388’s heels, sales tax revenue was so poor, education got severely shortchanged, including here in Kershaw County.

So, you would think I would advocate using property taxes -- millage -- to pay for the necessary replacements, upgrades and additions the district wants to perform here.

I’m suggesting the exact opposite.

On the local level, sales taxes are a far fairer and more efficient way to pay for what are, technically, short-term projects. Think of it this way: statewide property taxes should pay for year-to-year, ongoing education needs -- salaries, curriculum, programs, etc. A 15-year local 1-cent sales tax should cover things like replacing a school or making a stadium safer and more accessbile. The school or stadium may be left standing for years, and require long-term maintenance, but its actual construction is much more finite.

What the district is proposing in the short term for a specific purpose is what legislators tried to do with Act 388 on an ongoing basis to fund education in a general way.

Tuesday, Wilson estimated the $138.8 million bond for construction would necessitate a 40-mil increase in property taxes, the equivalent of $160 more per $100,000 value of homes and a $240 increase on all other property taxes (business property, automobiles, etc.). That’s something no one wants, myself included. The 1-cent sales tax on the other hand -- based on figures Wilson’s been able to obtain from state officials -- would likley more than offset such an increase. And, anywhere from between 30 and 40 percent of the local 1-cent sales tax revenue would be paid by people coming into or through our county from other areas.

There are those who say any tax is bad and, therefore, we should vote against anything which raises taxes. I don’t like taxes, either, but you have to have some in order to pay for services, including education.

The question is whether the taxes being levied are fair and are being used for the right purpose.

I’m not presuming to tell you how to vote. I will suggest, however, if you believe these projects should be undertaken, vote yes on both referenda; if not, vote no on both.

A warning, from today’s story, though: voting no on both could be more costly and for far longer than the other atlernatives.