Minutes 01-23-2018 - Laserfiche WebLink

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46 • Can we know how much citizens are paying for each individual service relative to what they are getting from each individual service? No, Not really. • For example, citizens of town A are paying $50 for the library and getting $30 worth of services while citizens of town B are paying $10 for the library and getting $15 of services. • In essence, citizens of town A are subsidizing citizens of town B. • Abe buys an airline ticket for $400 and Barb buys an airline ticket for $600. Both are on the same flight. • With one purchase of one good we can say that Barb paid $200 more than Abe. • In essence, Barb is ‘subsidizing’ Abe’s trip. • But consider the following. Abe and Barb don’t buy individual airline tickets, but buy a package that includes airfare, hotel, food, drinks, and activities. • Both Abe and Barb pay $2,000 for the vacation package. Who subsidizes who? • In the first scenario, Abe is ‘subsidizing’ Barb’s hotel while Barb is ‘subsidizing’ Abe’s airfare • In the second scenario, Abe is ‘subsidizing’ Barb’s airfare, while Barb is ‘subsidizing’ Abe’s hotel Results • The same thing applies in Orange County • Ignoring charges and specific taxes, for the most part taxpayers are paying into a general fund, which is spent on many different services. • Different amounts of monies can be spent in different cities for identical services, but you can’t assign individual weights to both the taxes and the expenditures. • You can only determine the summation of the value of all services relative to the total tax since citizens receive one tax bill not a separate tax bill for each service. • If one spends different amounts in different cities for the same service, you are a priori choosing the percentage of tax revenue spent on a service. In essence by picking different amount to spend, you are picking how much citizens pay for that service. • Citizens of town A and B pay a tax bill of $500. Town A spends $30 on the library while town B spends $15 on the library. Results (chart) (Services received by citizens per capita) Results • Notice that the summation numbers are negative. You will also notice that some cities are more ‘negative’ than others. Does this mean that some cities are subsidizing others? Not necessarily. • Recall that services received and taxes paid are occurring in the same year. • All of the city and county governments are moving current tax year receipts into ‘funds’ for future expenditures • One can think of these ‘funds’ as savings accounts—hence the ‘negative’ numbers • Different cities also have different amounts being paid into reserve funds. • Some county level programs are less evenly distributed than others. For example, economic development dollars are more concentrated in the cities than the unincorporated parts of the county