5 ms·

Yeah I saw his property tax of $1,600 per year and how it was already too high to raise. Tax rates of $8,000 to $20,000 are common around me.

by 300bps 5y ago

cableshaft 5y ago
Galesburg is a declining city in the middle of nowhere. People who live there probably drive to work ~50 miles away to Peoria or Davenport/Moline every day if they don't have a (probably) low paying job in town. And if that's the case, they'd probably be better off moving closer to those cities, there's probably even cheaper homes within a shorter commute. Also it's in Illinois, which is #2 in the country for highest overall property taxes[1]. Keep in mind he said a reasonable house value just north of their downtown is $75k, where the national average price for a home is $374k (as of Q2 2021), which is 5x the price. $1600 * 5 = $8000, which brings it up to what's near you. And considering Illinois' property tax is higher than every other state other than New Jersey, I'm guessing the homes appraised value near you is likely a lot higher than $374k, even. That being said, I don't understand why the government wouldn't be able to up just the city's percentage (as opposed to all line items on the property tax bill) by about $100-200/yr per person and use that to help close the gap. The percent going to the city of Galesburg is currently a tiny percentage of the overall tax. [1]: https://www.illinoispolicy.org/illinois-again-ranks-no-2-in-u-s-for-highest-property-taxes/ https://www.illinoispolicy.org/illinois-again-ranks-no-2-in-...
- mitigating 5y ago
  People will fight against any tax raises regardless of the amount.
  - cableshaft 5y ago
    Well yes, that's one reason it probably isn't being raised. But if you could let the people know that "hey, this is going directly into fixing the roads, and your property tax will only go up $8 per month to afford it, otherwise your roads will stay shitty", I think most people could be convinced to go along with it.
    - pharke 5y ago
      It would be helpful if you could just go to a website, enter in a code from your property tax bill and see exactly how every dollar of the taxes you paid were used. This is one of the valid uses of a public ledger I can think of. In my opinion, all tax funded spending should be traceable like this with each transfer recorded and reported to the tax payer.
      - gruez 5y ago
        Doesn't checking the city's budget do the same thing? The only thing that site would add is multiply the budget amounts by your tax bill.
        pharke 5y ago
        I don't feel like that addresses the part of the comment I was speaking to: > "hey, this is going directly into fixing the roads, and your property tax will only go up $8 per month to afford it, otherwise your roads will stay shitty", I think most people could be convinced to go along with it. At a minimum, you could create a system that takes the budget and shows a percent breakdown of where your money goes. If you packaged it nicely so that you could understand it at a glance it would go a long way towards what the comment I was responding to was talking about. After looking at my city's budget, I think there is still a lot of room for improvement. For my municipality at least, it seems to be a mix of specific and extremely nebulous items. I can see that the fire department purchased several new vehicles and even the type of vehicle but the road works department just lists additions to their "fleet" and the sanitation department just lists "new vehicles". I see items for sidewalk and street repairs along with the name of the street but no indication of how much pavement was repaired or what the breakdown of labor vs materials was. I think knowing all of the details would help the public assist their representatives to correct overages and would be a bulwark against corruption. e.g. If I run a business that sells fasteners and I see that the city government is overpaying by 30% for the bolts they use to put up new street signs I could bid on the contract next time around or maybe tip off the newspaper if it's more like 200% over retail.
      - ghaff 5y ago
- lotsofpulp 5y ago
  > And considering Illinois' property tax is higher than every other state other than New Jersey, I'm guessing the homes appraised value near you is likely a lot higher than $374k, even. It is the opposite. Illinois homes’ sale prices are kept down due to the higher (and always increasing) property taxes. NJ is also the same outside the regions that get buoyed by the higher incomes of NYC/Philadelphia. It is the same as any business with a lot of debt that gets valued lower than a comparable business with less debt. And NJ/IL and a few other jurisdictions have debt that is multiple standard deviation from the mean.
  - DavidPeiffer 5y ago
    >It is the opposite. Illinois homes’ sale prices are kept down due to the higher (and always increasing) property taxes. So true. I used to live in the Quad Cities, which holds Bettendorf and Davenport in Iowa and Rock Island and Moline in Illinois. When looking at houses, there might be a 25% difference in prices for similar houses in Iowa vs Illinois. Many of my coworkers on the Illinois side were looking to move to Iowa, but were going to walk out with very little equity by the time they took a hit on the sale price and pay transaction costs. The consensus among locals was "Illinois state government may implode at some point, and pretty well the only way to avoid that is by significantly increasing taxes".
- prawn 5y ago
  I'm not from the US and barely familiar with how properties are taxed, but would it be fair to guess that the range of road maintenance costs across the country are narrower than the range of housing prices? Labour would vary, but materials less so, right? So if suburban maintenance is funded by property taxes and people resist a certain level of taxation, then some level of increased density is the only alternative? Someone wanting small-town rural living would need to accept some adjusted balance of poorer roads, higher taxes or increased density?
umvi 5y ago
Start charging $20k property tax and you'll probably accelerate the decline of Galesburg as people scramble to relocate to more affordable areas.
milesskorpen 5y ago
Absolute numbers aren't a tax rate. 1% of $2M home gets you to $20k/year easily. But the article talks about $100-200k homes; there is no way this town can have a 10-20% property tax rate.
cortesoft 5y ago
That $1600 is based a 10% tax rate, if you look at the chart. That means the whole property is only worth $16,000. Are you really suggesting they charge more every year in taxes than the house is worth?
- rdtwo 5y ago
  At the very low end there is a minimum tax regardless of property value. If you fall below a certain value you end up dragging down the community
gnopgnip 5y ago
If you live in Galesburg IL, or Jackson MI, Altoona PA, Rome NY or similar places if the property taxes were raised to 10x as much the homes would be worth literally zero. The rental income wouldn't cover the property taxes. And that is the underlying problem, when the costs are so high, collecting a "fair" or actually necessary amount of taxes has a debilitating effect on the economy

Yeah I saw his property tax of $1,600 per year and how it was already too high to raise. Tax rates of $8,000 to $20,000 are common around me.

by 300bps 5y ago

Yeah I saw his property tax of $1,600 per year and how it was already too high to raise. Tax rates of $8,000 to $20,000 are common around me.

cableshaft 5y ago

Galesburg is a declining city in the middle of nowhere. People who live there probably drive to work ~50 miles away to Peoria or Davenport/Moline every day if they don't have a (probably) low paying job in town. And if that's the case, they'd probably be better off moving closer to those cities, there's probably even cheaper homes within a shorter commute. Also it's in Illinois, which is #2 in the country for highest overall property taxes[1]. Keep in mind he said a reasonable house value just north of their downtown is $75k, where the national average price for a home is $374k (as of Q2 2021), which is 5x the price. $1600 * 5 = $8000, which brings it up to what's near you. And considering Illinois' property tax is higher than every other state other than New Jersey, I'm guessing the homes appraised value near you is likely a lot higher than $374k, even. That being said, I don't understand why the government wouldn't be able to up just the city's percentage (as opposed to all line items on the property tax bill) by about $100-200/yr per person and use that to help close the gap. The percent going to the city of Galesburg is currently a tiny percentage of the overall tax. [1]: https://www.illinoispolicy.org/illinois-again-ranks-no-2-in-u-s-for-highest-property-taxes/ https://www.illinoispolicy.org/illinois-again-ranks-no-2-in-...

mitigating 5y ago
People will fight against any tax raises regardless of the amount.
- cableshaft 5y ago
  Well yes, that's one reason it probably isn't being raised. But if you could let the people know that "hey, this is going directly into fixing the roads, and your property tax will only go up $8 per month to afford it, otherwise your roads will stay shitty", I think most people could be convinced to go along with it.
  - pharke 5y ago
    It would be helpful if you could just go to a website, enter in a code from your property tax bill and see exactly how every dollar of the taxes you paid were used. This is one of the valid uses of a public ledger I can think of. In my opinion, all tax funded spending should be traceable like this with each transfer recorded and reported to the tax payer.
    - gruez 5y ago
      Doesn't checking the city's budget do the same thing? The only thing that site would add is multiply the budget amounts by your tax bill.
      - pharke 5y ago
        I don't feel like that addresses the part of the comment I was speaking to: > "hey, this is going directly into fixing the roads, and your property tax will only go up $8 per month to afford it, otherwise your roads will stay shitty", I think most people could be convinced to go along with it. At a minimum, you could create a system that takes the budget and shows a percent breakdown of where your money goes. If you packaged it nicely so that you could understand it at a glance it would go a long way towards what the comment I was responding to was talking about. After looking at my city's budget, I think there is still a lot of room for improvement. For my municipality at least, it seems to be a mix of specific and extremely nebulous items. I can see that the fire department purchased several new vehicles and even the type of vehicle but the road works department just lists additions to their "fleet" and the sanitation department just lists "new vehicles". I see items for sidewalk and street repairs along with the name of the street but no indication of how much pavement was repaired or what the breakdown of labor vs materials was. I think knowing all of the details would help the public assist their representatives to correct overages and would be a bulwark against corruption. e.g. If I run a business that sells fasteners and I see that the city government is overpaying by 30% for the bolts they use to put up new street signs I could bid on the contract next time around or maybe tip off the newspaper if it's more like 200% over retail.
    - ghaff 5y ago
lotsofpulp 5y ago
> And considering Illinois' property tax is higher than every other state other than New Jersey, I'm guessing the homes appraised value near you is likely a lot higher than $374k, even. It is the opposite. Illinois homes’ sale prices are kept down due to the higher (and always increasing) property taxes. NJ is also the same outside the regions that get buoyed by the higher incomes of NYC/Philadelphia. It is the same as any business with a lot of debt that gets valued lower than a comparable business with less debt. And NJ/IL and a few other jurisdictions have debt that is multiple standard deviation from the mean.
- DavidPeiffer 5y ago
  >It is the opposite. Illinois homes’ sale prices are kept down due to the higher (and always increasing) property taxes. So true. I used to live in the Quad Cities, which holds Bettendorf and Davenport in Iowa and Rock Island and Moline in Illinois. When looking at houses, there might be a 25% difference in prices for similar houses in Iowa vs Illinois. Many of my coworkers on the Illinois side were looking to move to Iowa, but were going to walk out with very little equity by the time they took a hit on the sale price and pay transaction costs. The consensus among locals was "Illinois state government may implode at some point, and pretty well the only way to avoid that is by significantly increasing taxes".
prawn 5y ago
I'm not from the US and barely familiar with how properties are taxed, but would it be fair to guess that the range of road maintenance costs across the country are narrower than the range of housing prices? Labour would vary, but materials less so, right? So if suburban maintenance is funded by property taxes and people resist a certain level of taxation, then some level of increased density is the only alternative? Someone wanting small-town rural living would need to accept some adjusted balance of poorer roads, higher taxes or increased density?

umvi 5y ago

Start charging $20k property tax and you'll probably accelerate the decline of Galesburg as people scramble to relocate to more affordable areas.

milesskorpen 5y ago

Absolute numbers aren't a tax rate. 1% of $2M home gets you to $20k/year easily. But the article talks about $100-200k homes; there is no way this town can have a 10-20% property tax rate.

cortesoft 5y ago

That $1600 is based a 10% tax rate, if you look at the chart. That means the whole property is only worth $16,000. Are you really suggesting they charge more every year in taxes than the house is worth?

rdtwo 5y ago
At the very low end there is a minimum tax regardless of property value. If you fall below a certain value you end up dragging down the community

gnopgnip 5y ago

If you live in Galesburg IL, or Jackson MI, Altoona PA, Rome NY or similar places if the property taxes were raised to 10x as much the homes would be worth literally zero. The rental income wouldn't cover the property taxes. And that is the underlying problem, when the costs are so high, collecting a "fair" or actually necessary amount of taxes has a debilitating effect on the economy