Will local governments pass rising costs to taxpayers?

When inflation comes for your property tax bill, will your local officials be prepared?

Greed is the real cause of inflation, according to the President of the United States, progressive senators and left-wing activists. 

You, simple American selling driftwood sculptures on the roadside to cover gas money, are merely the victim of corporations who greedily raise prices so they can pocket record profits. 

So when rising prices hit local governments, which are entirely altruistic and never motivated by a desire to spend other people’s money, they’ll absorb the costs and not raise taxes, right? 

Rising costs have already hit New Hampshire municipalities hard, WMUR has reported.

Governing magazine reported in April that “state and local governments are having to contend with a range of fiscal challenges. Inflation is at a 40-year high, meaning the cost of capital projects and even routine service delivery is going up. The tight labor market means governments are having to increase salaries, which in turn puts upward pressures on pension costs. Already, rising interest rates are limiting the success of governments in issuing taxable bonds.”

And then there are the self-inflicted cost increases. Manchester has approved a $15 minimum wage for full-time, hourly city employees, and the city Board of School Committee is mulling one for the schools as well. 

These wage hikes were initiated not to keep up with market pay rates, but as part of the “living wage” movement. 

Raising pay to at least $15 an hour, even if qualified people are willing to do the same work for less, is held to be a moral imperative.

The real moral imperative, however, is to spend taxpayer money efficiently and effectively. Paying more than necessary for goods and services is not an obligation of government; it’s a violation of government’s obligation to the taxpayer. 

One test of how aggressively local governments pursue efficient management of taxpayer resources will come during the next round of local budgeting. We could see then whether local officials sought to protect taxpayers from rising prices, or whether they passed costs on with little regard for people’s ability to pay. 

(Toronto this spring approved a tax increase double the normal size, citing inflation.)

Another test of whether local governments are willing to help fight inflation will come at local planning and zoning board meetings, and on local ballots next spring. Are these boards willing to roll back the most restrictive land use regulations so the private sector can build more housing, more warehouses, more gas stations, more pipelines?

If municipalities do cite higher costs as a justification for tax increases, will progressives denounce them as greedy? Or is greed, to progressives, a vice that afflicts only the private sector?