"What country can preserve its liberties if its rulers are not warned from time to time that their people preserve the spirit of resistance?" Thomas Jefferson
Fox13, Fees, And The Hidden Tax Burden
Fox13′s Max Roth recently completed an in-depth report on the myriad of fees we must pay that cloak the true cost of government. I highly recommend reading/watching the report. I just have two caveats.
First, fees in and of themselves are not necessarily a bad thing. As Roth notes, many fees for services utilized on a personal basis are fine in my book. I much prefer I or the user pays rather than forcing everyone to pay for their interest (RAP taxes, City Recreation Centers, and mandated recycling are good examples of such). I have no real problem with State Park fees or most school fees (they’re my kids, I should pay for them). The take-away from this report, however, is that all fees do need to be looked at with an air of suspicion. That includes fee categories, such as the school fees – is each part of the school fee really necessary or are some a means of subsidizing someone else’s interest/program/budget? As demonstrated in the report, fee abuse occurs and serves as an run around truth-in-taxation and transparency resulting in government over-reach and increased burdens on individuals and families.
Second, Roth didn’t notice (probably doesn’t realize) another very effective tactic several Utah cities use to avoid truth-in-taxation. Cities with a municipal (city-owned) power company are well known to manipulate the power rates and customer charges to generate additional revenue. Unlike, private power companies, the cities also don’t have oversight from the Public Service Commission when raising rates. The overcharged rate revenue is transferred into their general fund. Just as noted in the report related to fees, the cities then blare that they have low taxes and/or haven’t raised taxes for x years.
It would be nice to see a follow-up on both issue and see them addressed. Kaysville residents got sick of waiting and just passed Proposition 5 to terminate the power rate manipulation by their city – here’s hoping others will take notice and follow suit.
More on the power transfer subject can be found here.
I recently posted a follow-up on Bob Segall’s series dealing with the billions/year illegal immigrant tax fraud that the IRS continues to allow despite Inspector General reports. I highly recommend the investigative series. Segall’s done a great job which will, hopefully, save us billions per year…if the IRS does anything about it.
Segall’s investigation was limited to Indiana. However, it looks like a Utah company engaged in similar behavior (DOJ claims Orem tax preparer cost government $416M). That company crossed the line where the IRS doesn’t seem to care (child tax credit fraud) to where they do (deductions for fake entities etc):
The U.S. Department of Justice asked a federal court in Salt Lake City to bar Sergio Fernando Sosa and his company, Sergio Centro Latino, from preparing tax returns for others…A complaint in U.S. District Court alleges Sosa falsely claims dependents, earned income tax credits and child tax credits for customers. He also files business returns with expenses and deductions for fake entities, underreported income and inflated expenses…
The report indicates a $416 million loss over five years. I’m not sure how much of that consists of the IRS-complicit fraudulent tax credits to illegal immigrants Segall found but it would be interesting to know.
I followed the Fruit Height recycling fiasco for while now. Click here for the prior posts on the city purposefully forcing out a private recycling company for their program. That brings us to the present and time is running out to opt-out (while they still allow such…remember, they can try to make the fee mandatory later as Bountiful City did).
There are three ways to opt-out of being forced to pay the recycling fee (tax). You only have until November 30th, however. Don’t put it off.
1. Call the city at 801-546-0861 and tell them you want to opt out
2. Email the City Manager email@example.com
3. Fill out the opt-out form (which includes statements to shame you into not signing)
Be aware that opting-out is apparently time limited. If you don’t opt-out and decide you won’t use the program, it’s a bit like Hotel California – “You can check-out any time you like, But you can never leave!”
Remember, as many have done, you can still contract with a private curbside recycler (see prior posts for an example). Unlike the city, they don’t obligate you for life.
In June, I noted that the IRS finally appeared taking steps to stop billions of tax dollars going to fraudulent claims filed by illegal immigrants. Apparently, I spoke too soon. The practice is seems to be continuing with little change (IRS wastes billions in bogus claims for Earned Income Tax Credit):
The Internal Revenue Service paid up to $13.6 billion in bogus claims for the Earned Income Tax Credit last year and as much as $132.6 billion over the past decade, according to an internal audit that already has some members of Congress questioning how the agency will be able to administer Obamacare.
IRS problems with the tax credit aren’t new. In fact, the Treasury inspector general for tax administration said it warned officials about the problems in 2011 — but two years later, the agency still hasn’t solved the situation and remains in violation of one of President Obama’s executive orders.
As noted in my June post, please see the outstanding series of investigative reports filed (all 12 reports available at linked page) by Bob Segall at WTHR in Indiana. In the latest report, denials are up but the majority of the problem remains thanks to IRS incompetence (IRS center that reviews info from illegal workers still plagued by “chaos”):
A year after WTHR aired its original investigation, senior investigative reporter Bob Segall returned to Austin to again meet with Antelis and other IRS tax examiners who work on the front lines at the ITIN Processing Center. Most of the workers are not impressed with the changes implemented by the IRS.
“It’s still a big scam going on,” Antelis said from his living room. “It’s still very easy to rip us off.”
Unsurprisingly, things don’t appear any better on the congressional level with Harry Reid blocking amendments to deal with the situation:
To make Congress’ intent clear – that only legal U.S. residents are entitled to ACTC credits — Grassley co-sponsored a clarifying amendment with Sen. Mike Enzi, R-Wy.
“Unfortunately, the majority leader (Harry Reid, D-Nev.) cut off debate, so we weren’t given the chance to offer our amendment,” said Grassley, the top Republican on the Senate Judiciary Committee.
I guess the IRS can get a crack team together to intimidate Tea Party folks and conservatives but putting an end to billions in actual fraud is a bridge to far. Guess everyone has their priorities…
Above linked WTHR video report:
In my previous update I warned that fiscal responsibility was temporary and the city would approve the pet projects as soon as the heat was down. Here we go: The city council came out with the agenda for the upcoming Tuesday, October 8 meeting. It included the line:
“Discussion of City Hall and consideration of Fixed Limit Cost of Construction for new City Hall of $8.5 million and total building construction cost 0f $9,970,000″
The city then quickly (within minutes) reissued an amended agenda with the line changed to a vague:
“Discussion of City Hall options”
This is reminiscent of the city using a “discussion” item (with no public comment available) to quickly make the recycling fee mandatory for everyone after assuring it would be an opt-out program. I anticipate the same move here, again without public comment.
I’ve been told that Tom Tolman was convinced by Mayor Joe Johnson to change his vote on the pet project. My guess, is that he was able to get Tolman’s vote by promising that Tolman’s pet project, the museum, would be funded.
Plan on seeing the city dump about $10 million into the buildings to satisfy local politicians’ legacies and their pet project goals. As far as the cost overrun goes, here’s the updated breakdown based on the different project start points (click here and click here for details on those):
- $750,000 to $9.97 million = 1,329% increase
- $1.5 mil to $9.97 million = 665% increase
- $2.4 mil to $9.97 million = 415% increase
Maybe this time they’ll just talk about the project but given past action, I seriously doubt that. Fool me once shame on me…
UPDATE: Some good news with a warning. The council voted (4 to 1!) to continue to “study” the city hall/museum/art project. That is a partial win but since the project is just under study, all it takes is another meeting with a “discussion” agenda item to fund the projects (also without any public input requirement).
So the projects are on hold…until they flip the switch…at any given time. As I’ve stated over and over – Stay vigilant!
About two years ago, a bunch of political power-broker elites met with the intent to kill the Utah caucus system. I obtained one of their emails with their agenda for the meeting (held in an exclusive club – go figure). Essentially, they all have sour grapes that they couldn’t get elected and find a way to push the system back in their favor rather than having to more directly deal with the great unwashed. What better way to do so than make campaigns so expensive and cost prohibitive that only their big money-selected candidates will be able to enter?
Thus, they decided to try to pull the wool over everyone’s eyes and push for a virtual or actual primary only system under the guise of “Count My Vote” (including an initial $500,000 in cash). As such, let me repost my explanation on how this ruse works and why they hate the caucus system so much:
We are aware of a push to kill Utah’s neighborhood caucus system and are confident of who the actors behind the push are. But why should anyone care? Why not do as they wish and move to a primary election only?
Simply put: a primary-only system rips power from you and your neighbors and places it squarely in the hands of elite interest groups with oodles of cash.
Right now, by attending a caucus meeting, you virtually shut out the big money interest groups. You know your neighbors, their principles, and their character. A big money group isn’t going to gain traction endorsing someone in such a meeting; nor can they when you realize that hundreds of these meetings are occurring at the same time. These meeting are the greatest means of empowering the unconnected ‘little guy’ and true grass-roots action.
Next, after the meeting, you and/or your neighbor has been elected to represent the neighborhood at the party’s convention to whittle down candidates who will either go on to a primary election or straight to the general election (depending on the percent of votes they garnered). The convention is also very effective at interdicting big money and outside influences. At the convention candidates court a manageable number of typically highly motivated, issues-oriented voters and they have a list of who they are and how to contact them. The result is that candidates can comfortably run shoe string campaigns and literally individually meet with each voter. Another benefit is that, in this phase, campaigns tend to focus on issues and specifics rather than fluff like expensive baby kissing ads. That means candidates who aren’t politically or fiscally well-connected have a fighting chance to be considered and nominated for the office they seek. It opens candidacy up to John Doe rather being so cost prohibitive that you need connections to big donors or independently wealthy.
The caucus and convention system grates elites as well as in-state and out-of-state political money pushers because it simply sucks so much power out of their hands. Once we hit primary and general elections, the elites can begin to peddle their influence as campaign costs skyrocket in an effort to contact potential voters with the fluffy mailers and ads lacking any substance (sadly, yes that wins elections and it’s the voters fault). However, these special interest groups only gained any significant power after you and your neighbors had their say and chose the candidates they could fund. The political elites and big donors want this constraint knocked off and want to become the king-makers without distractions.
I urge you to attend your neighborhood caucus and contact your neighborhood’s delegates. The neighborhood caucus is the great equalizer – use it! If you are not sure who they are, someone in your neighborhood does or you can contact your party offices and they should be able to tell you. I also ask that you contact the Governor and your state Representative and Senator and ask them to oppose any and all efforts to kill the caucus system…unless you are particularly fond of big money influence in politics and a deluge of vacuous political ads lasting for months…
They’re now on Plan D: Pump money into an initiative effort (with paid, not volunteer, signature gatherers, of course) to trick citizens to give greater political power to the political elites and big donors. Don’t fall for the gimmick.
Addendum: Adding a video that sums most of the points made above:
Additionally, the proposed initiative ironically makes getting on a primary ballot harder by increasing the signature threshold (again favoring the well-funded and politically-connected): “The Count My Vote Proposal Hurts Ballot Access“
Finally, an important problem I had not thought of is that the primaries will turn rural Utah into “flyover country” for state-wide election races ( Congressional, Governor, Attorney General etc). In a primary, the candidates will need the biggest bang for the buck by targeting (and catering to) the largest voting pools. Those pools primarily reside along the Wasatch Front. With the caucus system, rural delegates must be contacted, with a primary, population centers become the focus. Rural Utah will be largely ignored and lose influence and representation by state-wide office holders.
First, see here for the cost overrun background.
The good news is the city hall and art/museum center pet projects were put on hold by a single vote margin. The bad new is the hold is just temporary and there will be a push to move forward on the art/museum pet project:
…Among them was Dean Collinwood, who gathered signatures for a letter against the project. He offered an “alternative B” that would construct a new building for arts and a historical museum with about $2 million to remodel the existing city hall…Its executive director, Emma Dugal, wanted to avoid delay in the project.
Richard Higginson, Tom Tolman, and Fred Moss voted to table the project until a cost study can be completed. John Marc Knight and (mayoral hopeful) Beth Holbrook voted ‘damn the torpedoes, full steam ahead’. Barring your action, expect the city to jump through the cost study hoop and then approve all projects for who know how many million in tax money…or to sum this post in a single acronym: BOHICA.
I would highly suggest continuing to pressure the city council to permanently drop the projects.
On a side note: I believe the city council approved the extension of the mandatory recycling fee (another pet project they surreptitiously opted to force everyone to pay for).