While important, the minutia of the Grosse Pointe Public School Systems proposed technology bond debate distracts from the real issue – the troubling economic and population trends affecting the Grosse Pointe communities.
Bond supporters like to quote small numbers to translate the proposal’s 2.29 mills into the incremental impact on a homeowner’s property tax bill. The problem is that many little numbers translate to some pretty big numbers. If the bond proposal passes, it will be just one of roughly 17 different forms of a property tax levied by taxing authorities governing the Grosse Pointe communities.
Let’s take a look at the property tax landscape of the five G.P. cities.
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Now let’s take a look at some of the broader economic trends for the five Grosse Pointes.
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That is not a pretty table. We see significant loss of home values and income (proxies for net worth) and a declining population. (It’s worth noting the Shore’s reported increase in population may actually be just the result of their reorganization from a village to a city).
Taxing authorities have reacted to the ensuing loss of tax revenue (from both home values and population loss) by raising tax rates or relying upon new taxes to offset their loss of tax revenue. Contrasted against a population whose average earnings are declining, we see a significant increase in tax burden (percent of taxes paid against disposable income).
The Grosse Pointe Public School System’s tax rate presents a perfect example. In response to a variety of economic headwinds, the district has relied on a variety of levers to offset the loss of wealth(and thus tax revenue. In total, if the February bond proposal were to pass, it would culminate is a staggering 75% increase in the local homestead millage rate since 2003.
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While everyone engaged in the current debate wants what is best for our students, we simply have to weigh that against the broader economic picture. While the schools have pressing needs, so does every other taxing authority. What if they all modeled the tax burden trajectory of the schools?
Trying to out run loss of wealth and income with higher tax rates is not a good strategy. This is why moderation in these proposals is so important. The school district’s February ballot proposal does not appear influenced by the substantial and long-term economic issues affecting a community that is now in retraction.
The quality of our schools can be a lever for growth, but like any enterprise we have to make good choices and recognize there will be trade offs. The district has traditionally competed for students with our neighborhood schools, low class sizes, tremendous course offerings, and a highly capable staff.
Other school districts with much lower revenues have levied technology bonds to counteract their inability to provide these same high value services that Grosse Pointe is uniquely capable of offering. A far more moderate tax increase and better financial planning is required at this juncture.