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Announcing his reelection bid in April -- and more recently, in his campaign literature -- Councilman Chris Smith said he has "fought to keep taxes from increasing."  It's an interesting claim to make, since no one has proposed a property tax increase to the Council since Smith took office in January of 2010.  In fact, the last time Covington raised it's millage rate was 2003, and there have been two rate decreases since then (before Smith took office).

There hasn't been much to fight against.  But, more important, fighting isn't the answer.  We can see the effects full well in the damage done by partisan bickering and gridlock in Washington.

I'm not asking you to vote for me so I can fight for you.  I'm asking you to vote for me so I can work for you and with you to keep doing the things that put our city in good financial standing.  Doing so requires understanding how city business operates today and where revenues come from to fund those operations.  Taxes in general and property taxes specifically play a minority role in funding city services.  Residential property taxes are an even smaller piece of the puzzle.

In the fiscal year ended June 2012, Covington spent $19.5M on governmental activities (administration, public safety, public works, etc.) while generating $5.6M in program revenues (fees, operating grants, etc.).  That left 13.9M of expense to be funded through taxes and other revenues.  Public safety alone was a $10.5M expense, while property tax collections netted just $4.6M.  Residential property taxes were less than a quarter of that (~$1.1M), with more than 70% (~$3.3M) coming from Commercial and Industrial property.

Our city budget is balanced each year through profits made on electric and gas utilities.  For fiscal year 2012, $5.8M was transferred from utility funds to general government operations.  A 2009 study of Covington's electric utility found residential rates produce less revenue than the cost to provide electricity, meaning the bulk -- if not all -- of that $5.8M came from commercial and industrial customers.  Add that to the $3.3M in property taxes assessed for commercial and industrial property, and it's clear businesses are the lifeblood funding our public safety, public works, and other city operations.  Our healthy tax base of 80/20 commercial and industrial property to residential property is why Covington weathered the "great recession" without a millage rate increase, while other local governments were forced to implement a higher "roll back" rate.

All of this explains why I am focused on economic development and enhanced quality of life choices. 
Recruiting and retaining businesses is the only way to keep taxes low.  It's not about fighting.  If anything, conflict and discord among elected officials make business leaders nervous.  It certainly doesn't encourage them to invest.


It's not about what you fight against, it's about what we plan for and how we work to achieve it.  I won't fight for you.  But, I will work hard and smart for all of Covington to ensure we have plans and actions to build a sustainable future for our community.
 


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