Last week, I ran across this AP story about the Prop. 1/Prop. 2 battle:
Proposition 1, created by Mayor Bill White and other city leaders, would limit increases in property taxes and water and sewer rates. Those rates could only be raised by the combined increases of population and inflation or 4.5 percent, whichever is lower.
Proposition 2, developed by a group called RevCap and placed on the ballot through a petition drive, asks for a cap on all revenue collected by the city also based on the combined rate of population and inflation, with any excess revenue refunded to taxpayers.
Both initiatives require voter approval before the city can spend any revenue that would exceed their respective caps.
It gets interesting when Mayor White is allowed to characterize Prop. 2, the initiative the mayor doesn’t support:
But White says Proposition 2 would limit revenues from water services, airport landing fees and pollution fines that vary from year to year. Those fluctuations could force the city to cut crucial services to stay below the cap because enterprise funds only can be used for specific expenditures, he said.
The Federal Aviation Administration has warned White that if airport revenue is used for property tax refunds, the city could risk losing federal grants for improvements.
“Anything that would cut the federal funding for airport expansion or would result in cutting police protection is not what I would think of as (fiscally) conservative,” he said.
The problem is that airport revenue cannot be used for property tax refunds, according to Harris County Tax Assessor Paul Bettencourt. Chronically Biased dealt with this recently:
In a nutshell, the news release is based upon a letter from the Federal Aviation Administration, which Mr. Frank Michel from the Mayor’s office agreed was based upon a faulty premise. The faulty premise is that the FAA was told that airport revenue could be used for property tax refunds. According to Mr. Bettencourt, and Mr. Michel agreed, this is not correct.
Frank Michel agreed with Paul Bettencourt on KSEV that what the FAA letter said was wrong, yet the mayor is still out there repeating it.
And the intrepid AP reporter didn’t do any further digging. But he should have.