Airport sales tax catch-up: Extra money at the county?

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This past week, Talk Radio 1170 KFAQ's Pat Campbell spoke to a Tulsa County commissioner, the Tulsa County assessor, the mayor, the chairman of the City Council, a former city councilor, and a Tulsa Metro Chamber official this last week about the proposed Tulsa County tax increase to fund airport improvements and to create a $75 million "Close the Deal" fund.

It was interesting to hear County Commissioner Fred Perry respond to County Assessor Ken Yazel's assertions about surplus county funds and Campbell's well-taken point that many of those funds are under the control of boards that have no direct accountability to the voters. Under firm questioning by Campbell, Perry ultimately acknowledged that these officials are mostly beyond the voters' reach.

The members of the Tulsa City-County Library Commission and the Tulsa City-County Board of Health are appointed by the Mayor of Tulsa (confirmed by the City Council) and the Tulsa County Board of Commissioners. The Tulsa Community College Board of Regents are appointed by the Governor of Oklahoma. The seven members of Tulsa Technology Center Board of Education are elected by the voters, but at the low-turnout February school elections, and with seven-year rotating terms, it would take four years to change a bare majority of the board.

Each of these four bodies has a dedicated millage -- a share of the property taxes you pay. The millage appears to be ample to meet each entity's operating needs and then some, even when sales-tax dependent city governments are hurting from economic downturns.

The good news is that each body is insulated from having their funds reallocated for other governmental purposes. When elected officials try to balance priorities across all the different ways government could be spending our tax dollars, the funds controlled by the libraries, the health department, the community college, and the vo-tech school are off limits.

The bad news is that each body is insulated from having their funds reallocated for other governmental purposes. So even if there's a crying need for more police detectives or funds to open the city swimming pools, the surplus for these entities can't be touched to help. Instead, the surplus might be used for facility expansion -- say, a new building.

When these entities run a perennial surplus, when they take in more than they can reasonably spend, it's worth asking the question: How would we go about adjusting the permanent millage for these entities, to make space in the total property tax burden for more pressing needs? Is the governing board (unelected in three of four cases) the only body that can put a millage rate reduction on the ballot? Can the County Commissioners do it? Can it be done by initiative petition?

Or maybe there's a way that these entities could donate surplus monies on a year-by-year basis into a rainy day fund available to level out the dips in revenue for sales-tax dependent cities and towns. Of course, that would likely just give the protected-millage entities the incentive to spend every mill to keep it from going into the fund.

Perry made an interesting point about the way the Vision 2025 ballot was split up, and that some of any Vision 2025 sales tax surplus might not be usable for the airport projects being discussed. But the ballot title categories for each of the three taxes that went into effect are broad enough that I imagine they can fit each proposed expenditure into one or another -- "TO FUND CAPITAL IMPROVEMENTS FOR THE PURPOSE OF PROMOTING ECONOMIC DEVELOPMENT", "TO FUND EDUCATIONAL, HEALTH CARE AND EVENTS FACILITIES FOR THE PURPOSE OF PROMOTING ECONOMIC DEVELOPMENT", "FOR THE PURPOSE OF CAPITAL IMPROVEMENTS FOR COMMUNITY ENRICHMENT".

Perry used his last minute decrying a statement by Ken Yazel as "outrageous," "despicable," "irresponsible." According to Perry, Yazel "basically said that commissioners bring these kind of proposals forward -- first of all, we didn't bring this proposal forward, but -- commissioners have these bond issues and bond refinancing and put tax issues out there to benefit their friends, to benefit people that get the fees, that get the fees from the issuing." Perry said people ought to challenge Yazel to prove his allegation.

Here's what Yazel said the day before in a call to KFAQ:

What is driving this is how big can we make the bond issues so we get the bond fees generated so that people who really want to make money can make money, and it has nothing to do with the benefit of the taxpayers; it has more to do with generating these bonds. And by the way, follow the money, but follow the fees. If they go into an authority, they're one step removed from the taxpayers authority, and it's even worse once they do a contract for non-competitive bond fees. Do you know where they're going and who's benefitting? No. It can't be audited, and it's a shame, and they ought to get out of that business.These people, in my opinion, don't care about the project, they care about generating fees.

I raised similar concerns last week.

The Tulsa County Commissioners, as the board members of the Tulsa County Industrial Authority, could easily dispel the concerns Yazel expresses by publishing on the internet a full accounting of the money handled by TCIA, including the funds raised by the Vision 2025 and Four to Fix the County sales taxes, as well as conduit loans that aren't tied to tax revenue. Contracts between the TCIA and their vendors and advisers, etc., should also be disclosed online.

Every dollar has a destination. Some dollars went directly to program costs, for example, the annual payment to the Oklahoma Aquarium. Some dollars are repaying bondholders -- those can be further divided into principal, interest, and fees. The money received from the sale of bonds should likewise Some dollars may have been used to pay support contractors -- perhaps program managers, bond attorneys, bond advisers, bond underwriters. Some dollars may be sitting in an account in reserve -- those can be divided into reserves for specific projects or for future debt service. All of that should be spelled out, online, broken out by payee. And if a payee is an LLC, as taxpayers we deserve to have a list of owners of more than, say, a 5% share. Then let the taxpayers weigh that information for themselves.

MORE: I appreciate Pat Campbell's pursuit of this issue and his willingness to ask pointed questions of these elected officials. You can find all of Pat Campbell's interviews here; here are direct links to the specific interviews:

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This page contains a single entry by Michael Bates published on June 2, 2012 6:40 PM.

Tulsa in the news: Modern home, National Geographic was the previous entry in this blog.

Tulsa County Budget Board special meeting Thursday is the next entry in this blog.

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