Turning the tables

Mickey just loves his referenda. Careful manipulation of the facts and an electorate where around half the people are too disinterested or disillusioned to bother casting a vote make it easy to derive the outcome you want. And if that fails, you can always throw away the votes and cook up the result yourself (c.f. The Demon Profession, re the NZ First list).

Of course he doesn't describe it that way. The diVision "democracy policy" says, grandly:

Vision Wanganui will, literally, give power to the people. A real and direct influence upon all issues of local significance and a more effective input into Council decision-making. We will also pioneer the concept of ‘direct democracy’ and ensure that Wanganui leads the rest of the country in its decision-making processes. We will create a genuine partnership between the Council and its ratepayers and residents.

Etc etc... but buried beneath the rhetoric is this:

1.2 Citizens themselves may institute a district-wide referendum if 10% or over of those enrolled on the Wanganui District Council electoral roll gather the requisite signatures. Any subsequent referendum held would be binding upon the council (provided that the outcome did not breach any government legislation or legal guidelines).

Hold that thought, Watchers, and turn your attention to the latest piece of Mickery... sorry, trickery, from the Mayor who promised "nil rates increases": a rates increase. Of 1.8 percent, no less, on top of a 3 percent increase in 2006/07, for a grand total of 4.8 percent over three years.

And that's if you accept that 2005/06 actually brought forth a nil rates rise, which slobbering lapdog "senior reporter" John Maslin inevitably does. That of course was Michael Laws-speak for "some people will get screwed while some will benefit, for a median rise of nil". But who's counting, right? Certainly not Mas, who was editor at the time.

We could pause at this point to recite (somewhat predictably, we admit) our usual mantra: that this additional impost on ratepayers wouldn't be necessary (and Michael Laws would be our "Person of the Year" rather than Midweak's) if it weren't for the construction of monuments to Mickey's reign (e.g. the Splash Centre) and his personality (an enormous, and growing, legal bill).

But we're often asked whether we have alternative solutions to Wanganui's problems. In this case, we do.

A quick trawl through Wikipedia reminds us of California Proposition 13 (1978):

Proposition 13, officially titled the "People's Initiative to Limit Property Taxation," was a ballot initiative to amend the constitution of the state of California. The initiative was enacted by the voters of California on June 6, 1978. It would eventually be upheld as constitutional by the United States Supreme Court in the case of Nordlinger v. Hahn, 505 U.S. 1 (1992). Proposition 13 is embodied in Article 13A of the California Constitution.

The most significant portion of the act is the first paragraph, which capped real estate taxes:

SECTION 1. (a) The maximum amount of any ad valorem tax on real property shall not exceed One percent (1%) of the full cash value of such property. The one percent (1%) tax to be collected by the counties and apportioned according to law to the districts within the counties.

Its passage resulted in a cap on property tax rates in the state, reducing them by an average of 57%. In addition to lowering property taxes, the initiative also contained language requiring a two-thirds majority in both legislative houses for future increases in all state tax rates or amounts of revenue collected, including income tax rates. Proposition 13 received an enormous amount of publicity, not only in California, but throughout the United States. Passage of the initiative presaged a "taxpayer revolt" throughout the country that is thought to have contributed to the election of Ronald Reagan to the presidency in 1980.

In fact Massachusetts, Oregon, Colorado and Florida all went on to copy key provisions of the Proposition 13, while voters in 18 other states passed nearly 40 statewide tax-limiting measures. And bear in mind, Watchers, that in the US local councils not only fund the more prosaic stuff like sewage and water but also pay for police, fire brigades etc. So when Proposition 13 was advanced the naysayers predicted anarchy. Of course it never happened, and in fact the state grew faster than ever.

The measure is not perfectly drafted. For one thing, it had the unexpected result of capping rates from commercial properties and thus shifting the overall burden toward homeowners. The share of state revenue from residential property taxes has steadily increased, while the proportion from commercial properties has steadily declined. But having been enacted in the US for over quarter of a century, it's easy to see where Proposition 13 succeeds (stopping Councils raising rates to pay for their own follies) and where it fails, and to draft something better.

So here's our solution. Getting ten percent of voters - stung by an average 4.8% increase to cover Mickey's profligacy over the past three years - to sign a citizens-initiated referendum imposing a rates cap similar to Proposition 13 ought not to be hard.

Once the thing is signed, march on Guyton Street and deliver it to Michael Laws (cameras in tow, of course, so he and Antoinette Back can't lose a few reams of it between the front steps and his office). Then sit back and watch the fun, and start thinking of what you'll spend your extra money on once Mad Mickey's Expenditure Tango trips over its own shoelaces.

More on Proposition 13 (and well worth a read) from the Cato Institute, Cal-Tax Research, PBS, and the full text of the law is here.

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