SUMMER is supposed to be the slow news season, but Savannah is heating up in more ways than one.
If you live here, your life will be affected by two key events taking place over the next month:
• The City of Savannah will have only a couple of weeks to re-do its budget in the wake of Mayor Eddie DeLoach’s recent surprise announcement that he wants City Manager Rob Hernandez to revisit the toxic and universally loathed Fire Fee.
• The Savannah-Chatham County Public School System is set to adopt a 16 percent hike in property taxes.
Whether you own or rent, or whether you have children or don’t, in some form or another your life here is about to become more expensive.
Simply put, the finances of both the City and the school district seem to be at a crisis point beyond the ability of our leaders to navigate.
And you will now be tasked with paying the price for that, literally —whether through paying more in taxes or rent, or in seeing a beloved arts or social program on the chopping block.
Of the two budget issues, the Fire Fee is most on people’s minds. It has become so radioactive that attempts to fix it only seem to make it even more unpalatable, and call more attention to why it was such a bad idea to begin with.
In what seems to have been a total surprise to other members of Council, Mayor DeLoach announced that he will direct City Manager Hernandez to examine the possibility of a roughly fifty percent reduction in the Fire Fee.
It’s like Solomon’s proposal to cut the baby in half — except without Solomon’s wisdom in knowing that such a thing was never going to happen.
In a way, cutting the Fire Fee in half is the least wise course of action. At this point it would make more sense for the City to drop the fee and simply raise taxes, as the School Board often does at the drop of a hat.
(However, if the City does decide to raise taxes, thanks in advance for not holding me responsible for giving them the idea!)
Consider the conundrum:
1) If the Fire Fee is really intended to address serious budget problems, then one assumes cutting it in half will make it much less effective at its intended purpose.
2) If cutting it in half, or entirely, means that arts and social service programs will again face draconian cuts (as Hernandez threatened months ago), then the Mayor will be jumping out of the fire fee into the frying pan, politically speaking.
3) Since the expected revenue from the Fire Fee has basically already been spent, taxpayers are screwed no matter what.
4) Then there’s the issue of the stealth regressive tax break:
As first reported here back in January and based on research by Nick Palumbo, because the initial Fire Fee included a small City property tax rollback, it would have given a de facto tax break to anyone in the City with property at or above a fair market value of $640,000.
At the proposed cut-rate Fire Fee, that tipping point goes down to as low as any home with a $300,000 fair market value.
This to me is the crux of the Fire Fee problem:
1) If the goal of the Fire Fee is to raise money, why offer a tax break with it at all?
2) And why should affluent homeowners be the only ones to come out ahead as a result of the new City Fire Fee policy?
The irony is that while the City is to be commended for its zeal in not wanting to raise property tax rates, they won’t even get credit for that — the public perceives the Fire Fee as a de facto tax regardless.
The issue of who to blame for taxes brings up the school tax hike, a significant one set to be adopted later this month.
There’s no doubt that the school system has benefited from the media and public focus on the City’s Fire Fee. The School Board will again get a free pass for yet another major increase in property taxes.
Contrary to what most people think, the massive size of the school tax increase is far beyond what is needed to cover the City’s imposition of the Fire Fee on school-owned properties.
The schools will probably need about half a million dollars or less in the next fiscal year to cover their portion of the Fire Fee after discounts are applied for.
That’s a lot of money, but the schools’ new tax hike will have to raise enough revenue to cover over $10 million in currently unbudgeted expense.
If for some strange reason you feel good about the school system’s ability to adequately manage their own budget crunch, consider that they just mistakenly told 1,600 students — some with A and B grade point averages — that they would need to attend summer school.
Parents got the phone call explaining the mistake literally the night before the summer session was to begin.
So the school district will offer summer school to them anyway, since they already made plans based on the bogus information, which was chalked up to “incorrect coding.”
How inefficient is that?
Such systemic mismanagement and bloated, blatant incompetence, if it were done by our City government instead of the schools, would prompt an immediate outcry and demands for electoral change — and rightly so.
Except that the School Board elections mostly came and went (the runoff for School Board president is July 24), with voter turnout at an anemic 17 percent.
The school system will get away with this debacle, like they get away with most of them.
Meanwhile, in stark contrast, the political futures of the Mayor and many on City Council are very much in flux as of this writing. Their reelection stock falls precipitously every day the Fire Fee remains any type of reality.
The Mayor’s false dichotomy of “Accept the Fire Fee or face huge cuts in City services” seems particularly bullying and insulting, not to mention politically unsustainable.
The smart thing to do would be to eliminate the Fire Fee entirely. But I’m not sure if some of the egos involved will allow that.
In any event, the damage to credibility, if not to the budget, may already be irreparable.