We’ve been covering a lot of taxes lately. Burnsville and Dakota County are both raising them and many others are either staying flat or dropping slightly. Without the additional necessary revenues raised from taxes many are looking for new and inventive ways to raise funds so they don’t have to make the truly hard decisions on cutting services and staff back to appropriate levels.

Well, in a somewhat related way, Farmington has decided to change the way assessments are handled (page 94) for improvements. Instead of only charging residents most likely to enjoy the benefits of said improvements they have decided to take a different track and instead are going to add surcharges (known as franchise fees) onto electric and gas bills to raise the funds for things like street repairs. Now while this is a different animal for most cities, being that they generally only charge a small group of residents a much larger fee every few years, at the end of the day it is now a general tax being levied against all residents. Why is this a problem? Well instead of rolling it into the general tax levy, by burying the charges amongst other necessary bills (which is what gas and electric are as opposed to say cable TV–where most people see assessed franchise fees), Farmington is really hiding a $43/year tax.

The Farmington Independent has an editorial about this (sorry it may require registration) and they more or less support the idea but warn of the slippery slope:

It won’t be an easy idea for some to accept. At the most basic level the new fees is just another way of presenting a tax. That’s bound to rub some people the wrong way, even with the elimination of the sealcoating assessments. The fees as proposed would not be huge, but they would be paid monthly, instead of every seven years, which is the current sealcoating cycle. Creating the fee also opens the door for bigger fees down the line.

Those are all concerns, but at the moment there doesn’t appear to be a better option. The current method of paying for sealcoating is not working. And with the city already considering significant cuts the money will have to come from somewhere.

Now, I was in total agreement aside from the “the fees proposed would not be huge,” and, “with the city already considering significant cuts the money will have to come from somewhere.” No city in the South Metro has considered cutting enough. When the office staff is down to 5 people, essential services are the only things being funded (sewer, water, roads, fire, and police), and they’re not wasting on frivolous expenditures like a slop sink (page 7) at the ice arena then they have cut enough and I’d agree with the mayor’s who routinely champion the cost cutting measures of their staff members.

At the end of the day the people who lose out are the long time residents who have had to pay assessments for repairs done in close proximity to them for years. With the burden being shifted to all the taxpayers for future work those who have already paid large amounts into the system are not being treated fairly now. At the very least the most recent payers should be exempt from these fees.

What do you think about Farmington’s idea to slap on franchise fees to cover costs such as road maintenance/repair instead of using the more traditional route of assessments? Do you think that this is just another tax? Are you concerned, as the Farmington Independent is, about a slippery slope? Whatever you have to say about Farmington’s use of franchise fees on electric and gas customers to fund road repair go ahead and comment on as I’d love to hear your thoughts.

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3. Farmington School District is a Deadbeat
4. Farmington High School: Over Budget or Not?
5. The Habitat: Wildlife Education Center in Farmington