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Reasonable growth: What a spending cap will do
Nashua has had a spending cap on the books for 15 years. Yet the city still paves the roads, picks up trash, educates students and polices the streets. Franklin has had a cap for 20 years. Like Nashua, the city still functions, as do the four other New Hampshire municipalities that have tax or spending caps.
Despite the scare tactics from opponents, spending and tax caps do not destroy public services. If they did, New Hampshire would have six collapsed municipalities. Instead, it has six towns and cities that, under a tax or spending cap, provide essential services for less than they otherwise would cost.
On Tuesday, voters in Manchester will decide -- finally -- whether to cap the city's rate of spending and tax growth. A charter amendment would prohibit either from growing faster than the rate of inflation. In a city that has seen taxes grow by twice the inflation rate, or more, in the last decade, this cap would provide much-needed relief to struggling taxpayers.
However, the spending cap would not suddenly cause the city budget or the tax rate to fall. The cap does not mandate spending cuts. It would prevent spending and taxes from growing more quickly than the rate at which other consumer prices grow. That's it.
Growth is factored into the cap. If the city simply must spend more than the inflation rate in any given year, aldermen could do so on a two-thirds majority vote.
Those are reasonable restrictions. Similar ones have been in place for years in towns and cities around the state. Many officials say the caps have made their localities spend more responsibly. Since when has responsible spending been considered a bad thing in New Hampshire?

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Andrew Cline has been editorial page editor of the New Hampshire Union Leader since October of 2001. His writing has appeared in more than 100 newspapers and magazines, including The Wall Street Journal, The Washington Post, and National Review.
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YOUR COMMENTS
Comrade Jules, you're back! And I see you are still trying to put fewer impediments in increasing Manchester's taxes.
So you have gone back to the argument of comparing Manchester and Nashua. Please bear in mind that there are many factors in determining a tax rate, besides the tax cap.
The tax cap is a tool, but only one tool, that will help protect the taxpayer in the long run. I look forward to reading more of your opposing arguments (which this newspaper once described as "lame") so that I can get a good laugh.
- Nick, Manchester
Jules,
If you worked in the private sector you would realize Nashua is on the Massachusetts border and accordingly has higher property values and thus higher property taxes.
But you don't. You are another city employee who thinks you are being cheated and if you had a Lexus in your driveway all would be well.
- C, Manchester, NH
Brian in Dover...Nice job on the figures...
"When you consider that the commerical and industrial property tax base has grown more slowly in Nashua than in Manchester during that time, Nashua taxpayers have fared worse, not better than Manchester taxpayers..."
Economies of Scale...when the average cost per unit of a good or service falls as the quantity (scale) increases.
- Rick Olson, Manchester
Jules, your still off base...All cities are "economies of scale" and obviously, a 13% difference reflects that. Franklin has not grown because, as with most small towns in NH (Franklin: city that still thinks its a town) Few take into acount the NIMBY politics at play. When residents step up and say they dont want a walmart or a Home Depot or a Sams or a Cabela's they are saying no to an expansion of the tax base and yes to status quo. Nothing happens in a bubble, Joanne, and we get the government we deserve.
In good economic times and bad economic times, this city has seen a tax increase every single year since Baines entered office. This city is never short on creative ideas or fuzzzy math to increase our taxes...In terms of the school budget, they have a select group of screaming me-me's that show up at budget time and cry and whine.
If you want to see this city royally screwed, watch Mark Roy get elected. He is a bum and does not even deserve to be elected to fence viewer. He is part of the Gange of 8 and all htose bums should be thrown out on a rail. I will vote yes on the cap.
- Rick Olson, Manchester
Roger, as posted below, according to the NH Department of revenue, Nashua's property taxes have grown over 56% in the last decade, while Manchester's have grown over 46%.
Also, according to NH Dept of Revenue statistics, Nashua residents pay 30% more per capita for their property taxes. If you want to exclude the commercial aspects of property taxes, Nashua pays 20% more. If you want to use the median home value and apply the current tax rate, then the average Nashua homeowner will pay $4756 in taxes while in Manchester the average owner will pay $4181...a 13.1% difference. Any way you slice it, Manchester has a better tax situation than a smaller city with a 15 year tax cap.
There's no fuzzy math involved at all. Take a real, honest look at what Manchester pays for taxes as compared with other communities and you will see the difference.
Don't let the facts get in your way though......
- Jules, Manchester
"Any politician who hides behind a tax cap automatically goes on the "don't trust" list. Such politicians rarely have any real concerns or agendas, they're just political junkies/nerds that want a position of power. Attacking taxes is the easiest political move to make and I wonder what else any of these politicians have to stand on aside from that. - J Paige." Well if the State of New Hampshire had a state spending cap in place we wouldn't be paying for higher fees and taxes in vehicle registration, vaniety plates, tabacco, business taxes, meals and rooms increases and now taxing campsites just to name a few. A tax cap does just that, it ensures that those who are elected as our officials both state and local are repsonisble with the money we work hard for and pay into to have those services and goods. This reader would 'trust' a politician more if they were FOR a tax cap, otherwise they lie to get us to vote for them and then do just the opposite when elected and tax the heck out of us.
- Robert M Tarr, Manchester
I didn't realized Franklin has had a spending cap for 20 years. Well maybe that does explain its lack of growth. Franklin sits right on 93, there's no reason for its slow growth compared to other cities its size that don't have a cap and aren't as accessible near a highway. It also has one of the highest highschool dropout rates in the state.
Could this have something to do with its tax cap. Questions that need to be asked and considered before we have one. We certainly don't need our schools in worse shape than they are already.
- Joanne, Manchester
Jules Manchester,
You must've learned that fuzzy math they were teaching in the schools for a while? You say lets do the math and then provide nothing to back up your contentions. Please enlighten us with what the taxes rates for Manchester & Nasua are? Cite where you are getting your data? You should move on....
- Roger, Manchester
Let me get this right. The writer of this piece holds Nashua up as an example of how the tax cap is working in Nashua and at the same time rips Manchester for having out of control spending because the tax rate has allegedly risen at twice the rate of inflation.
Let's do some simple math. According to this column, Nashua has had a cap for 15 years and Manchester's taxes have been out of control for the last 10. So, why is Nashua still paying higher taxes with a 15 year head start with a tax cap? That doesn't make a good argument for a cap.
What this piece has unwittingly done, is show how well Manchester has governed itself in order to have a better tax burden than a smaller city with decade and a half of this type of measure.
Thank you Mr Editor for proving my point. Also, thank you BOA for being smarter than some prefab scheme and crafting responsible and value driven budgets.
- Jules, Manchester
Move Manchester forward? Yeah fowrard into an abyss of high taxes! For 10 Years Manchester has had tax increasese at double the rate of inflation. I have watched my taxes go up and up and city Alderman have shown absolutely no restriant in spending! I have had enough and I will be voting for the spending cap
- Rob, Manchester
Any politician who hides behind a tax cap automatically goes on the "don't trust" list. Such politicians rarely have any real concerns or agendas, they're just political junkies/nerds that want a position of power. Attacking taxes is the easiest political move to make and I wonder what else any of these politicians have to stand on aside from that. You want me to pay less in taxes, I'm all for that, but I want to know what services I'm getting for my money.
- J Paige, Manchester
I resent all the junk mail that makes it look like the city will fall apart if the cap passes. I'll vote yes just to protest all the trees these supposed liberals killed to spread lies and fear.
- Allissa, Manchester
I really resent the radio ads I hear on WGIR that are paid for with dirty George Soros money -- yes I am talking about Move Manchester Forward, a group funded by outsiders that has come to Manchester to destroy it.
How do you folks feel about these outsider groups using Soros money to destroy your local government? There is another group floating around, also funded by the Rockefeller foundation's WCC, that tries to get the candidates Pledge outlawed.. you know, curtail your freedom of speech? They are infiltrated into your town meetings...
We need to banish (by law) these outside groups funded by billionaires from lord knows where, from having any say in the tax structure of our NH cities and towns.
- Sue, Manchester
Why does the UL continue to print these opinions that tell half the story? Shouldn't we be concerned with the whole picture?
While the author uses selective dates to determine that the city tax rate has grown beyond the rate of inflation, he/she neglects to explain the circumstances of neglect behind the increases. Why not go back 20 years instead of 10? Why not mention our children in temporary classrooms? Schools without proper heat? Roads in disrepair? The understaffed police department? City employees who went without a raise for seven years while the economy was booming? The increases of the last 10 years were a direct result of poor management and neglect from a lack of small reasonable increases in spending to keep up with inflation and growth.
We should be learning from our mistakes in the past, which teach us that playing catch up for underfunded budgets cost us more painful increases in the future.
I also question the use of the rate of inflation index, which others have pointed out....does not include the fastest rising expense in a municipal budget, which is health care costs. Also, using a national index that factors in lower average costs for fuel, heating and housing costs does not paint a fair picture for those of us who live in the more expensive northeast part of the country.
Please get beyond the slogans and the mud slinging and think this thing through. Many state we are slowly heading toward becoming the Lawrence of the North, but that is a municipality that suffered greatly under their version of a tax cap. Let's learn from others mistakes and not endure the pain from our own.
Peace
- Jimmy, Manchester
Whatever your opinion on the tax cap, just remember that Mark Roy - as a member of the Gang of 8 - didn't think you were smart enough to decide for yourself. He worked overtime (and failed) to keep your vote from being counted on this ballot initiative. He even went so far as to have a secret vote that was thrown out of court to keep you from voting.
If Mark Roy doesn't trust you, can you trust him? Hey, I don't have a vote in this election because I'm in Lebanon, but it seems to me that politicians in any town or city shouldn't consider themselves above the people.
- CDR, Lebanon
I just voted for the spending cap. I have a practice ballot .. this is so much fun. Everytime I fill in the circle, I hear the "gang of eight" scream in pain.. It is almost like a voodoo doll.. I use a number 2 pencil, but I call it my "number 8" pencil. Vote, Vote, Vote ..
- tom, manchester,nh
Well Tim Nickerson,
Being from Manchester and working in Nashua I see both cities very closely. Nashua has by far grown better and safer than Manchester could ever hope too. Nashua has a nice downtown and is not saddled with violence and drunken mayhem like Manchesters Elm st. is. Nashua does not have the BURDEN! of those so called desirable venues and stadiums that are a net loss to the city after all the nickles are counted. Nashua property values have held better than the ones in Manchester too. Having seen both cities in the day and night...I will take Nashua any day. Just wish I could sell my house in Manchester for what its worth and move south!
- John, Manchester
While a tax cap may be a fine idea in principle, in practice it hinders the city's growth and ability to embark on major initiatives.
As a former Nashua Alderman and Board of Education member, I saw the effects Nashua's spending cap had first-hand. While Manchester was able to build new venues such as the Verizon Wireless arena, the MerchantsAuto.com Stadium, and expand the Manchester/Boston Airport, Nashua's ability to do such things has been stymied.
The spending cap, although it allows for growth, is also backwards in its arrangement. In bad times, inflation is high, thus allowing for higher spending and tax increases. In good times, inflation tends to be low, thus restricting what can be done in the city.
Hopefully, the residents of Manchester learn from Nashua's mistake. Reject the tex cap on Tuesday, November 3rd.
- Tim Nickerson, Nashua, NH
If you have relatives who live in Maine be sure to tell them to vote yes on Question 4 (the Taxpayer Bill of Rights) on November 3. Q4 will put into place reasonable spending limits on the state government. Any spending increase over the limit, or tax increases, must go to the voters for approval. As this editorial states, reasonable spending limits work in NH so why not in Maine? Of course if Q4 passes in Maine we will need a state spending limit in NH as well . . . otherwise we might one day be talking about the "Maine Advantage."
- Scott, Haverhill
I am glad Manchester has the opportunity to vote on the cap. Any community that democratically enacts a cap is responding to the wishes of its residents. In casting their votes, however, it is important that residents consider the pluses and potential minuses of a cap (there are always costs and benefits). The Rhetoric and emotion on both sides provides little insight into either benefits or costs. Except in Nashua, the beneift does appear to be lower property tax collections. The costs are likely to be evident over a longer period of time but to suggest there will be none is to ignore a lot of evidence.
No community will fall apart. Nashua will not ,despite its cap ,because it has spent more than is apparently alowed by its cap language (even though it may not have voted to override). How this happened I do not know. Property tax collections have grown more in Nashua than in Manchester since 1999 according to official reports of the NH Dept of Revenue.
When you consider that the commerical and industrial property tax base has grown more slowly in Nashua than in Manchester during that time, Nashua taxpayers have fared worse, not better than Manchester taxpayers (Franklin taxpayers ,however, have fared better)
The data below compare Nashua and Manchester property tax collections between 1999 and 2008
Property Taxes Paid (school ,Muni, county)
1999 2008
Nashua 104,591,830 163,688,676
Manch 114,960,610 168,279,385
% Change: Nashua 56.5%
Manchester 46.4%
Soure: NH Dept of Revenue
- Brian, Dover
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