GSFTC Newsletter December 2009
December 2009, Volume 1, No. 1
Contents
- From Your Board of Directors
- Our Mission
- Participate in our Online Poll
- Can We Talk?
- New Partners Add Numbers, Experts
- GSFTC Welcomes Cathy Silber
- Redden Presents to Ways & Means
- ITEP Study Confirms the Poor Pay Higher Share
- What Is a Fair Tax, Anyway?
- To Cap or Not To Cap
- Annual Meeting January 7
From Your Board of Directors
Dear Friend of Fair Taxes,
After a long, hot summer of intense work, the board and steering committee settled on a mission that captures the goals of our next phase of work. Our cornerstone principle remains encouraging legislators to find alternative revenue sources to lower property taxes. While tea bags dangle from the hats and signs of those who oppose any change to the state’s tax structure, we are having a sound, rational and fact-based dialogue.
That dialogue started with you, and we’re counting on you to take it to the next level. Keep up the fantastic letters and blog entries about the need for fair taxes. With each one, you are helping to chip away at the old arguments that no longer add up. People are beginning to doubt the mythology of “tax-free” New Hampshire and are feeling more comfortable speaking up about it. We were heartened to hear New Hampshire business leader Gary Hirshberg testify to the joint legislative Ways & Means Committee this fall that the “New Hampshire Advantage is related to our quality of life, not our tax policy.” That there was a joint Revenue Information Session at the State House is further evidence that people are interested in discussing this long-taboo subject.
Our intent now is to involve our grass roots even more closely in our planning. For instance, you’ll see elsewhere in this newsletter we are asking you to complete a web-based poll that will help us determine some critical steps over the coming year and beyond. Our communication with you will be more frequent and more action-oriented. Our newsletter will be available quarterly as a link online, and we will continue to be in touch at least monthly if you have shared your e-mail address with us. Throughout the legislative year, we’ll be calling upon you to talk with your representatives in Concord about what’s fair – and we’re equipping you with a “Lens” to give some consistency and framework to those discussions.
We hope you will choose to become even more involved with us. We’re seeking more board applicants, and our working committees all need volunteers to assist in the areas of fund-raising, outreach, communications and technology. Please contact our new coordinator, Cathy Silber, if you are interested in any of these areas at nhfairtax@gmail.com or 986-7696.
We will kick things off at our annual member meeting and dinner, Thursday, January 7 (see page 4). There, the board will offer more details and solicit your feedback on our plans for the coming year. We have limited space, so please reply early.
With thanks for your continued support and interest in fair taxes,
Your Granite State Fair Tax Coalition Board
Our Mission
A just and fair New Hampshire requires a just and fair tax system.
The state’s over-reliance on property taxes has resulted in a system where those of limited means pay the highest tax rate, while those with the greatest means pay the lowest tax rate. This is unjust and unfair.
The Granite State Fair Tax Coalition advocates a balanced tax system that includes new revenue sources to reduce the state’s dependence on the property tax. The tax system as a whole must be designed to provide sufficient revenue to sharply reduce property taxes while continuing to meet the state’s needs. Any new or existing revenue source in such a system must consider one’s ability to pay.
The Coalition works to empower New Hampshire citizens to engage in open, honest dialogue about tax policy in their communities and with their representatives in Concord. By developing evaluation tools to gauge the impact and fairness of any tax policy, the Coalition promotes rigorous evaluation of all revenue proposals to understand the advantages and disadvantages for all residents. The Coalition is transforming the discussion about tax policy from one of slogans and sound bites to one of fact and substance.
Please Participate in Our Online Poll
GSFTC members who have provided an e-mail address will soon receive a very important e-mail from the UNH Survey Center. Please watch for this e-mail from UNH and be sure to click on the link to take this important survey we have commissioned. This survey is designed to help us better understand our base of support, your opinions and needs for information. It will inform our steps and give us measurement to those we choose to take.
Your responses will be completely anonymous unless you specifically wish to make your opinions known to us. We are confident the UNH Survey Center operates under the strictest confidentiality standards. If you have any questions or concerns, please contact Laurel at (603) 894-5931 or e-mail nhfairtax@gmail.com.
Can We Talk?
If this is your first contact with the Granite State Fair Tax Coalition, some background information is due.
Since 2006, the GSFTC has pushed to encourage open, honest discussion about taxes in New Hampshire. Working with grassroots volunteers around the state, the Coalition placed a non-binding Fair Tax Resolution on town and school district warrants in 114 communities. The resolution directs state lawmakers to get serious about taxation, find fairer alternatives to raise revenue than we now have, and, in the process, lower property taxes. Voters in a whopping 72 percent of these towns and cities voted yes.
This newsletter tells about our next steps.
New Partners Add Numbers, Experts
We have recently welcomed two new and significant partners to the Coalition: the State Employees’ Association (SEIU Local 1984) and NEA-New Hampshire. Combined, these organizations give the Coalition the additional capacity to reach more than 30,000 individuals statewide. Each entity has also committed staff experts to the Coalition effort in the areas of communications, policy and advocacy. The SEA is represented on the GSFTC Board of Directors by John Hattan and the NEA-NH liaison is Carol Backus. We welcome and appreciate these new members.
If you are involved in an organization interested in the fair tax issue and wish to explore partnering with GSFTC, please get in touch. Our executive team is available to talk with your decision-makers about ways we can work together. Contact Cathy at (603) 986-7696.
GSFTC Welcomes Cathy Silber
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Cathy Silber |
Join us in welcoming new GSFTC Coordinator Cathy Silber! Cathy has a strong background in social justice issue advocacy and grassroots organizing and we know those of you who are engaged in the fight for fair taxes will enjoy working with her. We think of Cathy as the glue who will keep the organization on track as we implement our next phase.
We hope you get a chance to meet her at our upcoming annual meeting January 7 (see page 4 for details).
Meantime, Cathy can be reached at our main e-mail address, nhfairtax@gmail.com, or at (603) 986-7696.
Redden Presents to Ways & Means
A joint information session of the House and Senate Ways & Means Committees was held October 21 and 22. It was organized by the House Ways and Means Committee chair, Rep. Susan Almy, who stood up stoically to criticism from those who believe an open discussion of revenue should be off limits.
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Laurel Redden |
GSFTC was one of five entities invited to present information from a community perspective. Vice President Laurel Redden spoke about the real problems caused by over-reliance on property taxes. She delved into the “unfair, unjust, and inadequate” tax system that has driven a nearly 8 percent increase in property taxes in the last decade. She also outlined “The Lens,” a set of criteria for evaluating fair revenue sources, which the Coalition encourages citizens and legislators to use in discussing revenues.
Economists, business people and community leaders from across the political spectrum shared different perspectives on the state’s revenue system and its impact on business, economic development, communities and individuals. Charlie Arlinghaus, from the Josiah Bartlett Center for Public Policy, made the case for the elimination or reduction of a variety of New Hampshire taxes. Stonyfield Farm president and CEO Gary Hirshberg attacked the conventional wisdom about the “New Hampshire advantage.” New Hampshire’s greatest advantage, Hirshberg testified, is “our work ethic and values, our education system, our natural environment, our sense of community, our democratic institutions—our overall quality of life—not our tax policy.”
“We applaud the Ways & Means Committees for holding a conversation about the way we tax in New Hampshire,” the Coalition’s Redden said. “It was a courageous and necessary first step, and didn’t warrant the criticism it got. Everyone is happy to talk about the fact that we’re facing a $200 million budget shortfall, but how many more of these kinds of budget cycles will we endure until it’s acceptable to talk about how we got here or how we can fix it?”
ITEP Study Confirms the Poor Pay Higher Share
The Granite State Fair Tax Coalition is encouraging New Hampshire citizens and lawmakers to take note of new data released on November 18 by the Institute on Taxation & Economic Policy (ITEP).
The report, entitled “Who Pays: A Distributional Analysis of the Tax Systems in All 50 States,” concludes that low- and middle-income families in New Hampshire pay a far higher share of their income in state and local taxes than do the wealthiest families in the state.
“The state’s over-reliance on property taxes has resulted in a system where those of limited means pay the highest tax rate, while those with the greatest means pay the lowest tax rate. This is unjust and unfair, and ITEP’s data today bears that out,” said the Rev. Bill Exner, president of the Coalition.
“Because there has been such reluctance to discuss tax policy in the past, we have found very little data exists that considers the impact of our tax structure on the very people who pay the most,” Exner said. “On the heels of the Joint Ways & Means Committee Revenue Information Session, reports such as these are timely and necessary to continuing a rational conversation on tax policy that will lead to a fairer system.”
The ITEP report for New Hampshire is available online at http://www.itepnet.org/wp2009/nh_whopays_factsheet.pdf.
ITEP’s full nationwide report is at http://www.itepnet.org/whopays.htm.
NH Tax Chart From ITEP’s Data
The chart below shows just how regressive New Hampshire’s tax system really is. Looking at taxpayers this way, we can see that the 20 percent with the lowest income (average $14,100 annually) pays on average 8.3 percent of income in taxes, while the 1 percent with the highest income (average $1,646,800 annually) pays on average 2 percent.
Applying our “Lens” (see article this page) to this chart, we can easily tell that New Hampshire’s current tax system falls short, measured against the first criterion—ability to pay.
What Is a Fair Tax, Anyway?
In its recent testimony at two-day Revenue Information Session held by the Joint Legislative Ways & Means Committee, GSFTC revealed a set of criteria for evaluating current tax policy and future proposals. We call it “The Lens,.”
Using “The Lens,” as a guide, we encourage New Hampshire to adopt a tax structure that:
- Accounts for an individual’s or business’ ability to pay.
- Demonstrates adequate capacity to lower property taxes for taxpayers of low or moderate means.
- Diversifies and balances New Hampshire’s revenue portfolio, which is currently over-reliant on the property tax.
- Expands the tax base, so that public revenue growth keeps pace with growth in the state’s population, economy and the need for essential public services.
- Offers simple administration and accountability.
“The Lens,” is available here on our Web site. We encourage you take a look at these questions, and use them to help keep the dialog about fair taxes going. We think asking these questions will lead to new thinking about how New Hampshire gets its revenue.
To Cap or Not To Cap
Tax caps are in the news and in the courts. On Election Day, a tax and spending cap charter amendment was defeated in Claremont while a similar one was passed in Manchester. The New Hampshire Supreme Court has agreed to hear a case involving the Manchester vote, and there is another case from Somersworth headed to the high court.
Caps have an emotional appeal of the “just say no” sort, and can seem like an instant fix to our problems. The cap message has resonated with voters in Manchester, and in earlier elections in Franklin, Laconia, Rochester, and a few other cities and towns.
But as they are currently proposed at the local level, tax and spending caps do not solve the underlying issues presented by our current property tax-dependent system for those who are truly struggling to pay their property taxes today. The average New Hampshire resident pays 5.8 percent of their income in property taxes. Many pay significantly higher. For those paying 10, 12, even up to 20 percent of their income in property taxes, a local spending cap is meaningless. Local tax and spending caps do not actually lower property taxes for anyone, nor do they prevent future property tax rate increases. They merely prescribe how much future expenditures can rise. And because they do not call for establishing revenues from other sources to offset property tax revenue, they can negatively impact essential services.
Meaningful and fiscally responsible tax reform goes well beyond the simplistic capping of future property tax rates.
New Hampshire economist Brian Gottlob has analyzed the cap issue in a report, “Are Local Government Tax and Expenditure Limitations a Race to the Bottom?” In it he evaluates the effects of Franklin’s cap, which has been in place since 1989, and discusses how a cap could affect Manchester. New Hampshire Public Radio’s story on the Gottlob study, http://cm.nhpr.org/node/27199, includes a link to the report.
Annual Meeting January 7
You are cordially invited to the GSFTC annual member meeting and dinner:
Date: Thursday, January 7, 2010
Time: 6 p.m.
Place: St. Paul’s Church, 21 Centre St., Concord
Tickets: $15/each
Mmm . . . good! What could be better on a wintry evening than spirited conversation and good food? Our guest speaker is Gary Hirshberg and our meeting includes a dinner prepared by our volunteer chefs team. Feast on chicken breast with cream sherry sauce or butterflied salmon with dill sauce.
The Coalition will adopt a budget, elect officers and directors for the coming year, review the past year’s work and delve into the challenging work plan for 2010. It’s a meeting you won’t want to miss.
Make your reservation now—space is limited—for a great evening.
Call Cathy at (603) 986-7696 or e-mail nhfairtax@gmail.com and let her know whether you'd like the chicken breast or the salmon.