NCAAbbs

Especially if it is relying on William Bell to produce its bailout plan.

http://blog.al.com/spotnews/2008/03/birm...illia.html

I was watching a TV news report from Orange County since they declared bankruptcy a few years ago. From what was said, there are several advantages O.C. had that Jeffco can't match. One, of course, is that the O.C. debt was much smaller in the first place. The second is that O.C. had a strong property tax base to rely upon for much of their "rebound" money. Jeffco has practically no substantial property tax revenues to call upon.
In Alabama, we are used to massive bond debt that is used to build highways, schools, bridges,etc. without any tax passed to specifically pay it off. This kind of bonds carry the highest regular interest rates since the risk of overextension is so obvious. When a government must "roll them over" when money is tight, it is a recipe for economic disaster like we are seeing in Jeffco's case. We simply don't pay enough regular taxes into county coffers to afford for Jeffco to build what the land developers and real estate companies demand for their projects.
I believe that if you look at the original bonds the Sewer Board sold, you will find sewer construction that benefited very wealthy developers who wanted sewers provided to their big development deals, and they were willing to pay commissioners bribes to get the deals done. Now the county taxpayers will be stuck with the resulting bills to pay.
BTW, Are any aware that the U of AL System is one of the six largest land-holders in the state? The System holds land roughly equivalent (last I heard) to the holdings of USX.

One reason there isn't enough tax revenue is because the tax base has been shrinking for decades. People are fleeing B'ham and JeffCo to Shelby. This causes less property tax revenue. Business flee, too. And higher taxes will not bring wither of them back. If you want to increase the tax base, reduce taxes. Give people an incentive to live and do business in JeffCo. But just throwing money at the problem (i.e. raisng taxes) never fixes the problem.

BatesUAB Wrote:One reason there isn't enough tax revenue is because the tax base has been shrinking for decades. People are fleeing B'ham and JeffCo to Shelby. This causes less property tax revenue. Business flee, too. And higher taxes will not bring wither of them back. If you want to increase the tax base, reduce taxes. Give people an incentive to live and do business in JeffCo. But just throwing money at the problem (i.e. raisng taxes) never fixes the problem.

The main problem with tax revenue is that the ones who have the least income, wind up paying a larger share of that income for most state and local taxes than the upper middle class and up. The city and county income ("occupational") taxes are good examples.
Under the present (1901) State Constitution, a locality must get a state constitutional amendment voted on statewide to give that locality permission to have an election regarding a particular tax. (The rest of this state has nearly ALWAYS voted "NO" on anything for Jeffco or B'ham.) IF the state SHOULD grant their permission to hold the tax referendum, then the real work of selling the tax to the electorate really begins. At its least, the process takes two or three years making immediate response to an emergency situation impossible. Another example was on the news tonight. The County Commission has tax money raised within Jeffco from the last sales tax increase, and suggests using it to pay the sewer debt rather than use it to renovate( or build new) schools. In order to do so, the STATE LEGISLATURE would have to pass a law permitting the county to change how that LOCAL MONEY would be spent. That's kind of like having to get permission from both sets of "In-Laws" before you and your spouse can decide what to buy with your own money.
The ONLY tax that can legally be raised locally without state intervention is the SALES TAX, explaining why the Jeffco municipalities have such uniformly high sales taxes, the MOST regressive of all state/local taxes. That also explains why state/county/local governments borrow so much money through sale of bonds. You certainly won't get the people to vote for a new tax! It's hard for a politician to say "NO" to powerful interests who have developments that await extensive sewer lines or other county services and are willing to bribe them to get what they want at public expense.
When money gets tight (like now), those bond debts become a crisis that push the county toward bankruptcy.

Nothing of what you said changes the fact that their problem is not one of inadequate taxation. Their problem is on the spending side of the ledger. Raising taxes will not fix the problem. The commission has to radically alter the way they do business. On a side note, exactly how do you figure that a sales tax is regressive?

The debt problem of the county is a direct function of low tax revenue in the face of rising costs for everything the county must pay for to serve the people. As with a family, you borrow when your needs can't be met by income (tax revenue for a gov't) and your needs are for essentials the people need and DEMAND. Yes, they could do with fewer deputies, firemen, road crews, sewer maintenance workers, etc., but how many want to see those cuts? That may just be in the cards if Chapter 9 Bankruptcy is decided upon. I've never lived in Jeffco outside of B'ham, but I think many would be upset if the county cut services to just what the revenue from taxes pays for. They are the county's second largest medical provider at Cooper Green, the Keytona Home, public schools, etc. The county provides police and fire protection outside incorporated cities and "backup" to city cops as well.
I haven't checked, but I wonder if ANY of the present or past County Commissioners live in unincorporated areas of Jeffco? Maybe it's just a case of the county providing sewer services below actual costs, and it's finally caught up with them? Just as with a family, if you can't pay cash and you can't get credit, then you do without. What will Jeffco be forced to choose to do without (or at least cut way back)?