Tax Collection and Spending

This question has surfaced before. In fact, during the campaigns for the new Civic Center Arena in 2015 and 2018, it came up no less than 100 times. Answers were provided, but the question lingers:

This Two Cents ‘author’ is apparently frustrated that the City isn’t funding our school needs. So, why don’t we?

Here is the answer, again:

The school district is a taxing entity. The City is a taxing entity. The County is a taxing entity. They are not the same taxing entity. A breakdown of property tax distribution from Rapid City collections could be helpful in understanding this.

Of your total Rapid City property tax bill:

The School District receives – 50.19%  ($44,378,854)

The County receives for county service provision – 29.78%  ($26,331,984)

The City receives for city service provision – 20.04%  ($17,719,709)

These figures do not include special taxing districts such as those served by volunteer fire department etc. This distribution is a product of state law.

The City uses this $17 million, plus another $26 million from one-cent sales tax along with some fees and charges to fund:

  • Police, Fire, Parks and Rec, Street Maintenance including repairs, cleaning and plowing, Public Works Administration, Community Development (planning and zoning), Finance Administration, City Attorney, Human Resources, Mayor’s Office and City Council, City Cemeteries, Library and Information Technology services.

One taxing entity does not fund another taxing entity. Doing so would adjust the distribution percentage and would ultimately undermine the intent of the law from which the distribution was born.

The City Vision Fund, which will fund downtown lighting, is derived from sales tax. To be exact, 42/100 of a penny on each dollar. This results in annual revenue of upwards of $13 million – $6 million of that will be used annually for the bond payments on the new arena, leaving nearly $7 million available for community projects.

The point: The City does not fund the schools, just as the schools do not fund the City. It’s separate, on purpose and for a reason.

The other point: People visit Rapid City’s downtown all year long. Spending happens, life happens and our downtown, one of the things we are becoming famous for, did not happen by accident. Our downtown is the heartbeat of our community.  Our downtown, however is dark at night and has been described as “Gotham.” The downtown is undeniably a growing, thriving area of town and will benefit from new street lighting. We all benefit from a thriving downtown.

The Two Cents ‘author’ might incorrectly believe the lighting project will benefit only Main Street Square, but the lights will be placed from West Blvd. to East Blvd on both Main Street and St. Joseph St. and will light not only the current core of downtown, but also the growing and changing East of Fifth area.

Citizens who made up the Vision Fund Committee as well as the City Council itself determined the lighting project was needed, and I agree.

Downtown 1950s Downtown pumpkinfest2013

 

 

Campaign Over. Issue Settled

RPCCAfter several long months of information sharing, presenting, advocating and campaigning, the day has come and the outcome of the new arena vote is here. 17,000 citizens voted and approved the new arena by a 64% to 36% margin.

There have been literally hundreds of volunteers giving their time, talents and money to promote the new arena. VoteYesRapidCity started as a campaign slogan, but morphed into a movement. An idea. Perhaps a way of thinking about the future of Rapid City.

VoteYesRapidCity is, in fact a campaign committee that will file its final report with the state and officially dissolve. But we, as stakeholders of Rapid City should keep the momentum moving. We owe it to ourselves and future generations.

It is always more comforting to stick to the past and go through life with as few changes as possible. No one likes change…no one over 25 anyway. We have to acknowledge we are all aging and the current community leadership should not only have today’s needs in mind, but should have also a strategy for tomorrow. Humans are short-term beings with daily needs taking priority in our lives. Long-term thinking is not natural and not everyone is cut out for it.

Last night’s victory was not about an arena. It was about progress. The voters spoke loudly and clearly: they want change. They want us to be known as the community that thinks ahead and doesn’t seek to stay in the past.

Something I have been taught, something that has been modeled for me and something I hope to pass on to others is this: Attitude is everything!

Rapid City could use a different attitude. We need younger people on the school board, in the legislature, on the county commission, on the city council and yes, in the mayor’s office. We need people from all walks of life, of all ages to take Rapid City by the reins and ride it into the future!! This cannot be done by relying on retired folks or career politicians. We need you to be a community leader!

The requirements to be a community leader are fairly basic:

  1. Own Rapid City. I mean really own it. As if it were yours – because it is. Make it better, every day. It may only be smiling at someone, or it may be changing someone’s tire. It could be helping to recruit volunteers, or helping with a campaign or perhaps running for office. There’s a reason small business owners invest so much of themselves into the business: because they own it and its success or failure is a result of their efforts, skills, investments and their attitude.
  2. Show up. It is essential you make yourself available. Today, America is a nation of opinions. We take the time to share them on social media and take time to chastise others for theirs, but what good is it if we avoid the real responsibility of taking a stand and offering ourselves to the service of others. Being involved with your own blood, sweat and tears is hard when the cost/benefit ratio suggests you’re an idiot. Don’t over-think it. Show up. Serve.
  3. Set the standard. Nearly 100% of America is made up of people in communities like ours. If we focus on that fact and focus on raising the bar in our communities… we raise the bar in our nation. We can set community standards for who we are, how we communicate and how we feel about important issues. We need healthy differences of opinion in order to achieve the best plans. We must be future-focused. We must realize we are, like it or not, going to hand this nation over to people who are at this moment children. Our eyes should be open to the concept that communities produce candidates for local, county, state and national offices The power starts with the local community. The foundation of effective governance is local people, raised in an environment of service and strength.

Today, you have a right to be proud of yourselves. But come tomorrow – get back to work. There are new ideas, not yet developed. New plans, not yet made. And new people, not yet engaged.

Thank you to everyone who worked tirelessly to make the new arena a reality. The progress made would not have been accomplished without you. Thank you to the thousands of voters who participated in the process. And finally, a special thank you to my wife Shirley for enduring the last year of late nights, work on weekends, sometimes countless hours of answering question and concerns on social media or the phone. I would not be who I am or where I am without you.

New Arena will Benefit Local Economy

Part One of Three: Economic Benefits of a New Arena

In just one week, we will know the outcome of the primary election and the future of the Rushmore Plaza Civic Center. On the ballot is an issue to authorize the City to bond for up to $110 million to build a new arena on the Civic Center complex.

A “yes” vote gives the complex new life and sets us on a course for larger and improved events, more economic impact and enhanced quality of life. A “no” vote, will place a Band-Aid on the Barnett Arena and will keep its current decline in progress. By my Arena Pro Formaestimation, in as few as 10 years we may be faced with the decision to infuse General Fund tax dollars into it, board up, or demolish the Barnett Arena. This would certainly close what has been historically a very popular, well-used and beneficial component to our community. A new arena will be financially self-sufficient and will not increase taxes.

To date, I have held a total of 57 presentations on the matter, and have spoken to over 2100 people face-to-face about this issue. I have come to learn that there are still sticking points and need a better explanation or justification. One of them is economics.

Rapid City is a visitor destination and we have been regarded as such since 1890. In Pennington County, there are 10,131 jobs that directly or indirectly exist due to the visitor industry.

In a 2017 scientifically-valid survey, Rapid Citians rated economic stability and growth as the number two priority behind Public Safety. Rapid City has little problem attracting visitors during the “on season” and since 46% of our general fund budget revenue is Survey Chartmade up of sales tax, we are left with significant reductions in revenue following the tourist season until Christmas and after Christmas until the beginning of tourist season. Rapid City doesn’t need to spend a great deal of time and energy trying to get more visitors here during June July and August. The off-months are the challenge and are historically the months when the majority of arena activity occurs. With the slow but steady decline in the usage of the Barnett Arena due to it’s outdated architecture, this is only making matters worse. A new arena, although never promoted as a ‘magic pill’, would certainly serve to bring visitors into our area in the off-season. Our visitors spend money, and a great deal of it. What’s more, the 10,100 people employed in full or in part by the visitor industry spend a great deal more money all year long.

A local economy is a closed system until it figures out how to bring in outside money. This can be done with exports such as manufacturing widgets to sell to people from other states or countries; it is done with agriculture when we export our livestock, farm goods and trees. This is also done with tourism, yet we don’t have to manufacture anything other than providing a welcoming destination for visitors from all over the world to travel. An economy only grows with outside money, it remains stagnant with the lack of it.

Building a new arena is a smart economic decision. It will benefit us all, even if we don’t attend events there. More sales tax revenue means less dependence on other revenues, such as property tax. It also provides more options for entertainment, recreation and quality of life.

Tomorrow’s topic: Parking