2010’s property tax assessment documents were sent out last month and you have a very small window of time to appeal your assessment. In many cases, taxable values went up while property values went down. The city of Grand Rapids has a web page with the required documentation you need to fill out for an appeal, available here.

There are several tools available online to see the values of homes that recently sold in your area for comparison to your own, such as trulia.com and zillow.com. Be sure to look for the “recently sold” sections of those web sites. Since property values have dropped approximately 30% in the area, it’s well worth it to challenge your taxable property values.

The Michigan Taxpayers Alliance also offers a DVD workshop that helps you with the process, for $10. You can check it out here.

State Representative Dave Hildenbrand offers a useful guide for appealing here.

Be aware, the deadline for filing appeals is February 12th!

insularity
in⋅su⋅lar /ˈɪnsələr, ˈɪnsyə-/
–adjective
1.     of or pertaining to an island or islands: insular possessions.
2.     dwelling or situated on an island.
3.     forming an island: insular rocks.
4.     detached; standing alone; isolated.
5.     of, pertaining to, or characteristic of islanders.
6.     narrow-minded or illiberal; provincial: insular attitudes toward foreigners.

How can “Hope” “College” be called an institution of higher learning? If I were a student or faculty member there, this would be embarrassing.

What struck me [Film Director Dustin lance Black] immediately was his [Dean of Students at Hope College Richard Frost] referring to me as “you people.” I asked him to clarify, and he hesitantly said, “gay people.” He claimed it was “my people” who had been attacking him since the news broke, though all of the complaints I’d read in the papers had come from straight people in his own community. But I didn’t argue that. Instead, I asked that he get to know gay and lesbian people individually instead of lumping us together, stereotyping. He agreed, but again used that phrase: “You people.” When I asked him to clarify again, he said, “You Hollywood people.” I assured him that, like gay people, Hollywood folks are also a diverse bunch. But it popped out again: “You people.” This time he wasn’t talking about Hollywood or gay people—this time it was “California people.”

Very Christ-like.

More here. Just ponder the difference in reactions and mentality of both sides of this issue. Who’s offering the real hope?

Why doesn’t the media do any investigating any more? Among today’s headlines is the story that Governor Granholm is delaying the school funding cut of $127 per pupil because the state’s November property tax revenues were $150 million higher than expected. Property taxes are among the most stable forms of government revenue, so such a large jump didn’t make much sense. You wouldn’t get any understanding of the reasons for this by reading any of the newspapers. I checked out the Detroit Free Press, the Detroit News, and the Grand Rapids Press. All three simply parroted each other – probably just printing what was on a press release.

Here’s one quote from the Free Press:

Granholm said one reason for the additional money is that commercial property values have unexpectedly risen in some areas, particularly Southeast Michigan. That’s resulted in an additional $100 million for the School Aid Fund.

Really?

According to the just-released state revenue report for November, that isn’t the case at all.

State Education Property Tax revenue was up 14.4% from November 2008, but with October 2009 receipts below the year-ago level, the increase reflects differences in the timing of payments. If October and November State Education Property Tax receipts are combined, 2009 collections are down 7.3% from the year-ago level.

In other words, Granholm is full of it.

The October revenue report for the state of Michigan has been released, and there’s very little good news to be had. Revenues were again below the most recent projections. October saw tax collections that were $31 million below expectations. The best real-time indicators of economic activity, sales taxes and income tax withholding, are both down, again.

Due to the near-complete collapse of state revenues, the cuts have (finally) been forthcoming. Public schools received per-pupil cuts of approximately $300 for the current fiscal year. State agencies have been ordered by the governor to cut 10% of their budgets. The cycle of layoffs and reduced revenues continues.

The result? Governor Granholm and the MEA have begun hyperventilating. This week they staged a massive lobbying effort to get legislators to increase taxes. Apparently they don’t require Economics 101 in teacher colleges.

On the city level, Grand Rapids has seen a similar decline in income tax revenues and property tax revenues will probably see declines due to historic drops in resale values of homes and commercial property. Immediately upon announcing the layoffs of 125 city employees, Mayor Heartwell called for a ballot question to raise taxes in the city. He claims there hasn’t been a tax increase in 15 years. Apparently the constant reduction of the personal income tax exemption, the added property tax bill “service fee,” and the increase in trash collection property tax don’t count as tax increases in the mayor’s book.

Oh, and don’t forget that The Rapid is coming back, probably in early 2010 to ask, again, for a tax increase to build the redundant and wasteful “Silver Line” bus service, to clog up Division during rush hour.

But the fiscal problems are just beginning, and there is very little sign that anyone is proposing real solutions. The “easy” way out, increasing taxes, will only work so much. They will run in to the law of diminishing returns. The speaker of the state house, Democrat Andy Dillon, apparently grew some huevos and bucked his MEA masters by proposing the pooling of all public school health plans into one statewide health plan. The MEA, fearing the loss of their money-laundering cash cow health plan MESSA, promptly went ape-sh*t. This illustrates the difficulty of real, substantive change at the state level. So many special interests peddling their influence (in the form of money) makes it nearly impossible to propose an innovative solution to the state’s structural budget problems.

Of course, then there are the unsustainable defined-benefit Ponzi public pension plans. They will fail. It’s just a matter of time. Even politicians can’t repeal the laws of compounding numbers. But I’m sure they will try.

But we should turn to the local level, where real people can have the most chance of affecting change. We can, as a city, choose to continue down the ultimately disastrous path of “the easy way out,” or we can have real, substantive change in how city government does business.

A quick overview of what’s going on at the local level: As state revenue declines, so does the state subsidy to cities called revenue sharing. Revenue sharing has been on the decline for several years. City leaders keep pointing to how much has been “lost,” but their complaints fall on deaf ears – or at least ears that understand that cities fall further back in line from other special interest groups.

As revenue sharing declines, so have city income tax receipts. The city’s income tax revenue is down 14% (apparently year on year).

Not only has revenue been on the decline, the gigantic hydrogen bomb of the city’s pension system is preparing to detonate. The city’s 2010 fiscal plan (published before the layoffs were announced this week), is available here. One paragraph should stand out and set off all the alarm bells in the city:

In FY2007 our two pension retirement trusts were 110% and 120% funded.  Both employer and employee contribution levels were at or near the lowest possible levels.  This advantage was eliminated by the breathtaking decline of the financial markets over the past 18 months.  We now know that our retirement funds are significantly underfunded. This means that both employee and employer contributions must move dramatically higher.  Proposed changes to actuarial assumptions and plan provisions will freeze employee contributions at the bottom of the contribution range and provide additional time for the City to adjust to higher employer contributions.  Nonetheless, the employer share will go from 7.7% in to 9.29% in FY2010, and 13.62% in FY2011 for the General Pension and from an FY2010 rate of 0% to an estimated 23% in FY2011 for the Police/Fire Pension.  These percentages assume that we will be able to implement critical smoothing techniques that will mitigate the intense upward pressure on required contributions. The increase in employer funding requirements contributed to the FY2010 GOF operating deficit of $2.9 million.  Unless we see a significant increase in the market value of retirement plan assets over the next couple of years, the estimated pension contribution will continue to rise. (emphasis mine)

Translation: 2010 layoffs are just the beginning. Fiscal Year 2010 includes a pension contribution (as a percentage of salaries) for the police and fire employees of 0%. Yes, 0%. This will go from 0% to 23% (of salaries) in one year. A search of the fiscal plan shows that total personnel costs for police and fire are about $67 million. Let’s back out about 40% of that (just a wild guess) to come to actual base salary cost. We come up with about $40 million. Now,  re-read the above paragraph. The city is going from contributing $0 in the current fiscal year to the police and fire pension plan to (my estimate) of 23% of salaries in 2011 – or about $10 million. The increase in contributions for the other defined-benefit pension participants on the city’s payroll will increase from 9.29% this year to 13.62% next year. This is unsustainable.

The mayor’s solution? Raise taxes.

Lest I be declared someone who only points out problems and no solutions, here are a few suggestions:

1. Lay off all non-essential employees. This includes the “equal opportunity” department of five people.
2. Outsource information technology (IT) services.
3. Eliminate the Office of Children, Youth, and Families.
4. Convert all employees, now, to a defined-contribution retirement plan. NOW.
5. Eliminate the Downtown Development Authority. This entity sucks up about $17 million of local property tax revenue that would normally go to the city’s general operating fund. The DDA also currently owns the Van Andel Arena. Sell the arena, pay off the outstanding bonds, and use the excess to pay off some of the DeVos Place bonds. The DDA currently operates as a taxpayer-funded subsidy to developers, giving away free money to those who ask.
6. Implement a fire department response fee. Most (if not all) homeowners insurance plans offer coverage if you’re charged for fire department response.
7. Eliminate the city’s trash collection services. There is a special property tax levied for this. There are plenty of private trash haulers. Once the trash collection services are eliminated, go to voters and ask them if it’s ok to convert the current trash levy on property tax to a general fund levy so that it can be spent on other city services (including police).
8. Contact every citizen and ask them what their priorities are. Do you prefer Police and smooth roads, or do you prefer an equal opportunity department and subsidies for developers?

If serious, dramatic changes are not implemented, the city will go bankrupt. This has started to happen in other states. There is no chance in h*ll that the economy is going to return to anywhere near where it was at the peak of the last cycle in 2007 – at least not any time soon.

Tough choices need to be made now – if our politicians can stomach it.

Just keep this chart in mind when they come back, in the near future, for debtslaveryus stimulus 2.0. Remember – the politicians are lying to you.

Stimulus Fail

Now that the Federal Reserve-stimulated asset bubble has burst in the housing markets, and the subsequent follow-on government attempts to fix a government-created economic crisis are failing (see cash for clunkers and the market-distorting “first time homebuyer credit”), it’s time to assess your current situation and decide whether or not to walk away from your mortgage.

The government, by changing the rules and allowing the “too big to fail” banks and their executives to escape the consequences of their actions, and ultimately causing the “too big to fail” banks to get bigger, has set the stage for the ultimate moral hazard. What does that mean? By changing the rules and bailing out the multi-million dollar bonus executives, they have shown us that the rules don’t apply across the board. If your gigantic “systemically important” corporation gives enough money to Barney Frank and the rest of Congress, you get your bonus even if you’ve succeeded in destroying your company.

This means that those of us on main street, who were caught up in the Federal Reserve’s asset bubble creation (aka, the housing bubble), are stuck holding the bag while the politicians and the bank CEOs laugh all the way to the bank – literally.

The housing market in Michigan won’t get back to it’s pre-housing bubble days until at least 2023, according to estimates. This means that chances are pretty high that your house is worth far less than you owe, assuming you got a mortgage in the last ten years (and didn’t cash out with a home equity loan). In fact, chances are your house is worth 30%+ less than it was just three years ago.

The solution? Walk away from your mortgage. There’s a handy calculator that will tell you if it is worth it to walk away. You can try out the calculator here.

I can hear it already. Moral obligation, doing the right thing, living up to promises, etc. Yes, you might have been right five years ago. Now, the rules changed in favor of the oligarchy. That means that all bets are off. We, the taxpayers, are stuck with an exponentially-growing national debt. The federal government continues to take on bad debt from the private sector. We get saddled with bad debt; the bank get to keep their bonuses and get even bigger.

The housing market isn’t coming back any time soon. In fact, it’s going to continue to get worse as we are hit with a deflationary depression. Japan did exactly what the US government is doing now. They’ve been stuck in a deflationary spiral for over ten years.

Fix your family budget. You alone will look out for yourself. Don’t expect the politicians or CEOs to do anything that’s in your best interest.

1. Consider walking away from your mortgage. It’s suddenly in vogue to rent again. You can rent a house nicer and bigger than the one you have for less money.
2. Move all of your checking/savings/investment accounts away from the big national banks. Find a local credit union. Credit unions didn’t participate in the housing bubble run up. They don’t screw over their customers with outrageous fees. They are non-profit institutions that return profits back to members.
3. Pay off unsecured credit card debt as fast as you can. Cut up the cards. Pay for everything else with cash (or your credit union debit card).
4. Stockpile CASH. In a deflationary spiral, cash is king. Instead of (government-created)  inflation eating away at the value of your money, deflation increases the value of your cash.
5. If you lose your job, stop paying on debt immediately. Build up savings, if you can. Only worry about feeding your family and keeping a roof over your heads. Foreclosure can take more than a year as the banks are overwhelmed.

This isn’t capitalism any more folks. This is oligarchy.

This week, President Obama re-appointed Ben Bernanke as chairman of the Federal Reserve. Bernanke declares that he “saved the world.”

This is a bit like the arsonist firefighter declaring that, after he set fire to your house, he then “saved” it from the fire. Right.

He lied then. He’s lying now.

Change we can believe in.

Last week the Grand Rapids Downtown Development Authority board approved the expenditure of $850,000 to help the city buy five new DASH buses for the downtown parking lots. The catch is that mayor Heartwell asked the DDA to kick in extra money so the city could buy hybrid-electric buses instead of standard buses. The standard buses cost $353,000 each, according to the Grand Rapids Press. The hybrid-electric buses cost $200,000 more (for a total of over $550,000) – each.

Earth to Heartwell: We are entering Great Depression II.

The mayor’s justification for the request to spend $1,000,000 more on five buses was summed up thusly:

Heartwell argued the DDA should somehow come up with the money — he didn’t know where it would come from — because having buses labeled ‘hybrid’ plays well with the city’s efforts to market itself as ‘green.’

“If for no other reason than the important symbolic benefit of having buses around downtown that say ‘hybrid,’ it’s an investment worth making,” he said. “It’s terribly expensive to do, but if we don’t start making these kinds of investments in our environment, we’re being short-sighted.”

So, in other words, the word “hybrid” painted on the side of a bus is worth spending an extra $1,000,000 of taxpayer money. Right.

Wisely, the DDA voted 5-1 (with Heartwell being the “one”) to reject his request.

Just to drive the point home of how the mayor is completely out of touch and apparently has absolutely no idea what a position of public trust involves, I was just leaked the actual improvements in gas mileage that the hybrid-electric buses enjoy. Get ready for this. These are the numbers from The Rapid (ITP) itself:

A standard diesel transit bus gets 4.45 miles per gallon. The hybrid-electric buses get 5.12 miles per gallon. Yes, that’s right – an improvement of 0.67 miles per gallon – all for the spiffy additional cost of $200,000 each.

Remember this when the city commission comes to taxpayers asking for a tax increase to shore up the rapidly-deteriorating budget.

Forget the artificial creation of the dual-party system. It’s a scam. They’re all lying.

The Detroit News is reporting this afternoon that the Michigan Democratic Party is proposing five issues to potentially appear on the 2010 general election ballot. They are:

• Raise the minimum wage from $7.40 an hour to $10 an hour and remove exceptions in the law that allow employers to pay less than minimum wage to some workers.
• Cut utility rates by 20 percent.
• Require all employers to provide health coverage or pay a fine.
• Increase unemployment benefits by $100 a week, extend benefits by six months and make all workers eligible for unemployment. The maximum unemployment benefit is now $387 a week.
• Impose a one-year moratorium on home foreclosures.

It’s frankly a bit stunning and just goes to show the complete and total ignorance of basic economics apparently held by the state’s Democratic Party leadership. The Republicans in the state have actually taken a bit of initiative to propose budget cuts to close the widening state budget deficit, but Republicans long ago gave up the ghost on having any credibility when it comes to walking the walk.

Anyways, perhaps the Democrats have not gotten the memo that the overwhelming evidence shows that a higher minimum wage increases unemployment (or decreases employment). Perhaps 15.2% isn’t high enough for them. Why does the minimum wage increase unemployment? Because it prices those out of the market with the least skills. Look at it from an employer’s perspective. If you were to hire someone at $10 an hour, would you hire a teenager or someone with little to no skills, or would you hire someone with some skills or prior experience? Of course you would hire the person with prior experience. The higher the minimum wage goes, the less likely that employers will hire people with lower skill sets. This is why, due to our complete and utter failure of public school systems in urban areas in this state, unemployment among teens, African-Americans, and unskilled laborers is close to all-time highs. A higher minimum wage will simply exacerbate this problem. It ends up harming people, not helping them.

Requiring all employers to provide health insurance or pay a fine is another killer of jobs, primarily jobs provided by small businesses. I know someone who recently started a small business and it has done extremely well. He has hired about ten people, all part time. These are ten people who are happy to have any job at all. If he had to pay for health care for these employees, he would probably have to lay about half of them off, depending on the cost. It would degrade the service he provides by being required to provide the same service with fewer people, and it would surely drive up prices.

Oh, and instituting a one year moratorium on home foreclosures would further encourage the moral hazard of walking away from one’s home. Heck, I would even consider walking away if I got a year of free rent. House prices in the Grand Rapids area have already dropped 25-30% in the last couple of years. Anyone who has purchased in the last five or so years is probably underwater. It makes simple business sense to stop paying the mortgage, save the payment for a year in a savings account, and walk away with thousands of dollars in savings.

Way to go Democrats! There’s nothing like pouring gasoline on a fire to try and put it out!