News: Charlotte Exclusives

It’s All About the Money

Should CMS have the power to tax?

In the pro sports world there is a saying: When everyone says it is not about the money, it is about the money.

When the Carolina Panthers released wide receiver Muhsin Muhammad it was about the money, especially the $10 million the Panthers did not want to pay him. Similarly, when Mecklenburg County Commission chairman Parks Helms suggests giving the Mecklenburg County school board the power to levy taxes, it is about the money. More of it.

Helms forced local leaders to take a position on the taxing question by coming out for granting taxing authority to Charlotte-Mecklenburg Schools right in the middle of a contentious budget season where funds are short. No matter who does the taxing, the perceived need for more revenue form the private sector is central the current situation, along with a strong desire to end annual wrangling over CMS’ budget.

In a way it is easy to sympathize with Helms’ inclination. Right now, the county commission gets to fight tooth-and-nail over taxing and spending decisions for schools and then hands the money off to the school board. County officials are then basically cut out of how that money is spent by CMS. There is also something to be said for making the line between taxing and spending as straight as possible, and lines of responsibility very clear. The current system splits responsibility between the county government and the school system and as a result, true accountability is weakened.

It may also be that the Helms proposal is merely a stalking horse for county-wide impact fees “earmarked” for school construction. Mecklenburg officials certainly would love a new revenue stream from new housing construction, one that could perhaps be used to secure school bonds for the new school construction needs that CMS has pegged at a whopping $2 billion.

In any event, it is certainly true that some school districts across America that have the power to tax do their jobs with great responsibility and restraint. And it is also true that some school boards are tax-happy and wasteful, running up property taxes without regard to the impact on the local economy. There is no absolutely sure outcome here.

But as county commissioner Jim Puckett notes, a school system in Mecklenburg with the power to tax needs some fundamental changes to how school board members are elected. First, the ostensible non-partisan nature of school board elections would have to change. There are simply no bigger philosophical and political differences than those which arise over questions of taxing and spending. Partisan school board elections would recognize this fact and allow for the fullest possible debate on important policy question facing the schools.

And to reinforce those lines of accountability back to the public, two-year terms for school board members might not be a bad idea. If we really want a strong feedback loop between a taxing board, have them face voters sooner rather than later.

Transition to a taxing board would also bring with it dicey budgetary issues that cannot be ducked. A wall would have to be erected between the funds collected for the school system and those for the rest of the county. Taxpayers would have to clearly understand via their tax bills where their money goes, who is spending it, and on what. Make no mistake, what would be a more direct funding system at the top, where the money is spent, would be much more complicated at the bottom, where the money is collected.

In short, a move to a taxing school board would be complicated and requires a careful understanding of the pros and cons. Those who advocate the idea because they think it would result in yet more money for Mecklenburg schools need to say that upfront. As CMS has yet to solve its chronic management issues, it is not clear that more money is a solution to its problems.

For that reason handing the power to tax to the school board, given the current environment, is unwise and premature. You might as well give matches and a gas can to a pyromaniac.