Gilmore
pulled a bait and switch on 'no car tax' plan; average families paying
more now
By
Paul Goldman
Goldman,
the Rebel With A Cause, was chief political strategist for
the past two winning Democratic governors in Virginia and was
credited with leading a "revolution in American
politics" by The New York Times for his role in breaking
America's 300-year-old color barrier in national politics. He
alone will be responsible for his column, ideas, and opinions. |
Most
Virginians should be paying no car tax in 2003. But Gov. Jim
Gilmore pulled a bait and switch that leaves average families paying
more than promised in his campaign five years ago.
Right now almost all Virginians pay a personal property levy on
their cars, despite GOP Governor Jim Gilmore's 1997 campaign promise to
end the car tax for most people.
Most
observers and GOP politicians blame this failure on what they
describe as an "unexpected" budget crisis. But the fiscal
truth is this: There would be plenty of money to eliminate the car tax
for a majority of Virginians if Mr. Gilmore had simply kept his campaign
promise when the car tax was enacted in 1998, during his first General
Assembly Session.
The GOP Governor and his party -- with my own Democrats as usual going
along like sheep -- double-crossed the voters by passing a car tax
repeal plan that was fundamentally different from the one promised
during the campaign. Indeed, if my own Democrats and fiscally
responsible Republicans had only listened to those of us urging Gilmore
to honor his original campaign promise -- not their
bait-and-switch approach to be discussed below -- the current
state budget would have enough money not only to eliminate the car tax
for most Virginians but hundreds of millions of dollars to spare to
improve education, ameliorate mental health services, and help the
private sector create jobs.
So I say again, the so-called "unexpected" budget
"crisis" is not the reason most Virginians still pay a
car tax. The car tax could be eliminated for most Virginians right
now with the money already available in the state budget. This would
not require any "borrowing" against tobacco settlement
revenues, any "raiding" of the VRS funds, or any more of the
"three card Monte" fiscal tricks that are again in vogue in
Richmond in certain circles.
Bottom line: The politicians in Richmond blame their inability to
eliminate your car tax on the "budget crisis" in order to
distract from the double-cross they pulled on you, the voters, in 1998.
Like a bunch of used-car hucksters, they played bait-and-switch. They
caved under political pressure from powerbrokers who forced a change in
the car tax elimination formula to benefit their areas at the expense of
other parts of the state.
Indeed, this bait-and-switch is one reason Mr. Gilmore got away with unprecedented
fiscal recklessness during the 2001 General Assembly Session. Why?
Simple political math. Under the original Gilmore campaign promise, more
than half the voters -- and an even higher percentage in some parts of
the state -- would be paying pay no car tax right now.
Thus, all these voters would not be pressuring legislators to cut the
car tax further because they would receive no benefit!
Accordingly, the General Assembly would not have rolled over when
Gilmore broke state law and his promise to them by illegally raising the
car tax repeal to its current 70 percent phase-out level. This action,
discussed by me in a Washington Post article two years ago, has
added a billion dollars -- and counting -- to the state's budget
deficit.
In my view, the car tax should be eliminated. But as a commentator, I
have to write honest analysis. This means pointing out that Gilmore
"cooked" the state revenue forecast in December of 2000 to
take an advantage of a loophole in the car tax law to force the 2001
budget stalemate, allowing him to raise the phase-out level to 70
percent when everyone in Richmond knew the true state revenue
forecast made raising the phase-out level illegal.
If his original campaign promise had been enacted, Gilmore never could
have gotten away with this maneuver because it would only have benefited
a small percentage of voters. However, under the car tax law passed in
1998, almost all voters received some additional benefit from his
illegal action thus cowering most legislators to stay quiet.
So, for those who want to know the true story of this GOP
bait-and-switch, the following, as Paul Harvey might say, is the rest of
the story.
Under the plan promised in 1997 by candidate Gilmore, the car tax would
be eliminated on the first $20,000 in assessed valuation. This
"elimination" was to be phased-in over five years by exempting
an increasing fixed-dollar amount of the assessed value of the car up to
the promised $20,000. Thus, the value of your car,
not the amount of your tax bill, was going to the basis of car
tax relief.
Based on the GOP campaign promise, there is enough money in the 2003
state budget to totally eliminate the car tax for a clear majority of
all Virginians based on the average value of the vehicles owned by state
residents. Thus, most Virginians should now be paying no car tax.
However, this campaign promise later proved to be unacceptable to key
Republicans - and probably key Democrats - from certain vote-rich areas
of the Commonwealth. Naturally, there are no fingerprints, and, I must
further state that when I asked a key member of the Gilmore
Administration about this bait-and-switch, he denied it was due to any
political deal, saying in effect it just "worked out that way"
to paraphrase the actual words.
But I am not buying this denial because as we say in the South, if it
quacks like a duck and walks like a duck, then it's a duck.
So let's cut to the duck walk right now. In Fairfax County, for example,
there are a lot of key, swing Republican votes owning one, two or more
cars valued at $20,000 and higher. Look what happens to an area like
Fairfax County under the original Gilmore plan. Since the average value
of cars there is far higher than the average value of cars in many other
parts of the state, the original Gilmore plan meant that, as the
phase-out progressed, most Fairfax County voters still would be
paying a burdensome car tax while, at the same time, the state would be
paying money to other localities to totally eliminate the car tax
for more and more, indeed most, of the residents of these counties.
Everything I know about politics tells me this: When this reality became
clear to the politicians working in 1998 to put Gilmore's campaign
promise into law, this situation was seen as a potential political
problem in places like Fairfax County. The politicians could hear the
voters asking: Why are my state taxes going to a phase-out plan that
will totally eliminate the car tax for most voters in one area of
the state while my neighbors and I still will be stuck with a
hefty car tax?
So, while my Gilmore Administration biggie says the change was not
politically motivated, look what just "happens to happen" due
to the bait and switch: Now, under the plan passed in 1998, Fairfax
County voters get the same 70 percent reduction in their bill as
the voters in all the other localities.
But more important, the 70 percent reduction is worth far more to the
Fairfax voters and those similarly situated than the voters in say the
Western part of the state.
Coincidence? If you think this "just happened," then I have
some land in Arizona to sell you which would be just perfect for your
additional purchase of the Brooklyn Bridge.
Let me make the math even clear. Had the original Gilmore car tax -- the
one promised in the campaign -- been enacted, the owner of a car with an
assessed of $10,000 or less would now be paying no car tax at
all; the owner of a SUV valued at $20,000 would be paying roughly 50
percent of his car tax bill. However, under the bait-and-switch plan
passed in 1998, the SUV family pays considerably less in car tax
while the average Virginia family pays 30 percent more than they would
have under the original plan.
The result: Here we are in 2003, and not only have the Republicans in
the majority reneged on their promises, but they say there is no money
to keep the state's promises in education, mental health, job creation
and other areas. Yet, they have been able to find the money to continue
to pay their record high per-diem "compensation" and another
several million dollars a year in alleged "reimbursable
expenses" that they refuse to document.
It is time to stop this "more for the politicians and less for the
people" motto dominating the General Assembly. The Bait-and-Switch,
"Give-me-mine first" Big Spending professional politicians are
back, only this time they are the Republicans in control of the General
Assembly.
This is one reason I believe we need a "Put K-12 education
first" law enacted during the 2003 Session, to make sure the
General Assembly lives up to the state's promises on education. Based on
a February, 2002, report of the Joint Legislative and Audit Review
Committee, the General Assembly's most important investigative body, the
state is reneging on its promise to help alleviate the burden of local
school taxes by $1 billion dollars a budget cycle.
How? Shortchanging the localities to the tune of $1 billion dollars in
promised state support causes property taxes to be a billion dollars
higher than it might otherwise have to be.
"Fool me once, shame on you, fool me twice shame on me" is an
old adage we all know from our grade school days. The GOP fooled us once
with a bait-and-switch on their car tax pledge. So let's not let them
fool us twice with their reneging on the state's educational promise,
voted into law by a referendum of Virginia voters in the 1970s.
Thus, my "Put K-12 education first" law will make sure future
governors and future General Assemblies don't "Gilmore us"
again.
(c) Copyright.
All rights reserved. Paul Goldman. 2002.
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