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PLANET EXCLUSIVE: WE MINE THE HIDDEN REVELATIONS FROM THE TAX CLASSIFICATION FOLLIES

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By DAN VALENTI

PLANET VALENTI News and Commentary

(FORTRESS OF SOLITUDE, TUESDAY, NOV. 25, 2014) — With a few more days of hindsight and analysis as opposed to The Suits‘ blind-sight and paralysis, THE PLANET has extracted additional gems from the Tax Classification Follies as performed last week by the mayor and the city council.

The Amazing, Invisible ‘New Growth’

In determining the spending plan for tax purposes, the city claimed $42 million in new growth. Tell us just how many new houses, factories, high-rises, and buildings have you seen going up in Pittsfield? We’ll pardon you if you didn’t confuse Podunk with metropolitan Raleigh, N.C. (fastest growing city in the country).

The question then arises: How did Pittsfield figure “new growth?” Also, how does the figure break out into its component parts? How much of that $42 million claimed to be new growth related to commercial properties? The city isn’t all that willing to include this information in its data. You have to mine it.

It turns out that a minuscule $1.3 million of the $42 million can be attributed to commercial growth. As you can see, Pittsfield is playing games with the “new growth” figure. This is significant because “new growth” allows the city to circumvent the 2.5% limitation on taxes. Whatever the city claims as “new growth” is added to the 2.5% allowable under law. Apply this legal chicanery and you can double 2.5%, which is what Pittsfield has done for FY15.

This being Pittsfield, would you be surprised to learn that even such subterfuge has a gigantic amount of hoodwinking in it? A full one million of the $1.3 million (of the $42 million) in “new growth” the city claimed at Patriot Resorts at South Street and Dan Fox Drive. What? You didn’t see much “new growth” there? Neither did THE PLANET. Apparently, Pittsfield looked at the hotel’s change of use (time share to hotel or the other way around), included a few extensions to some buildings, and called that $1 million in “new growth.”

When is New Growth Not New Growth?

So, where exactly did the other $40.7 million in “new growth” come from as calculated by the city? The city had no answer, unless you count the vague, mumbo jumbo answers supplied at the Follies.

Exploring the mystery of the $40.7 million claimed as “new growth,” THE PLANET drilled deep. We discovered that the city apparently claims “change of use” at non-profits as “new growth.” For example, if a non-profit agency purchases a private home and converts it into a group home (as it did on Stonehenge Drive), Pittsfield counts that as “new growth.” As astounding as that sounds, it appears that’s what passes for much of the alleged “new growth” in Pittsfield.

Taxpayers lose in multiple ways:

(1) The former private home is taken off the tax rolls. The city loses the thousands of dollars in income.

(2) The non-profit business pays no taxes but consumes services, another net-loss for taxpayers.

(3) By counting change-of-use as “new growth,” the city claims as an asset what it actually a loss. In the upside-down world of Pittsfield finances, such practices are “business as usual.” The only “growth” in this scenario is the growth in the tax rates of honest homeowners and businesses.

Chamber, Chamber, Where Where Art Thou?

Noticeable in their absence from the hearings were executives (or even lackeys) from the Berkshire Chamber of Commerce. Businesses in Pittsfield were again getting clobbered (a $36.62 per thousand tax rate), and their the alleged advocate was nowhere present. Think of that in light of this bragging fiction from the C of C website:

The [Berkshire] Chamber is organized to:

  • Advance the economic, cultural and civic welfare of the region it serves.
  • Encourage the growth of existing industries and businesses while assisting new industries and businesses seeking to locate to the Berkshires.
  • Support all those activities believed to be beneficial to the area and to oppose those that might be detrimental.
  • Promote the welfare of all citizens of Berkshire County, and all of the cities and towns within its boundaries.

Pretty words, aren’t they?

They don’t mean a lick.

Jonathan Butler, Chamber president and CEO  — No show.

June Roy “Rah Rah” Martin, vice president — No show.

Cathy Briggs, director of finance and administration — No show.

Darci Hess, director of marketing and communications — No Show.

Kathy Quinn, executive administrative assistant — No show.

Danielle Thomas, coordinator of events and programs — No show.

The Chamber’s 27 directors, from Peter Barry to Karen Zink — No show.

Here are the officers of the local chamber: Peter Stasiowski, Interprint, chairman; Linda Gaspardi Febles, Coakley Pierpan Dolan and Collins Insurance, chair-elect; William Wheelock Jr., Adams Community Bank, assistant treasurer; Chip Moore, Pittsfield Cooperative Bank, treasurer; Vicki Donoghue, Cain Hibbard and Myers, clerk; F. Sydney Smithers, Cain etc., assistant clerk; Larry Hazzard, Berkshire Life Insurance Co., advocacy council vice chair; Susan Seely, Signature Associates Real Estate, small business support council vice chair; Christa Proper, Cornerstone, next generation council vice chair; John Martin, Martin Oliveira and Hamel, membership council vice chair. All no shows.

Not one of these 43 “Business Elites” spoke on behalf of the small businesses in danger of extinction through excessive taxation. Thus, the next time you hear one of The Suits, their apologists, or their stooges sing “Everything Is Hunky Dory” song, boo them off the stage — and remember in next year’s municipal election.

——————————————————————————————–

“Ashes of destruction spread out so far / Blackened nurses crying over me / See a one-time city, now just a scar / Tears of the flower man fill the sea / Give me a chance to fly away / There’s nothing here for me today.”Uriah Heep, “Simon The Bullet Freak,” (1971).

“OPEN THE WINDOW, AUNT MILLIE.”

LOVE TO ALL.

 

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Ron Kitterman
Ron Kitterman
9 years ago

You may not think that supporting the local chamber doesn’t matter but it does. Why? , because it just makes sense…

take the money & run
take the money & run
Reply to  Ron Kitterman
9 years ago

The local chamber may have thought supporting bussiness’ in setting the new tax rates, but to them it made no cents.

take the money & run
take the money & run
9 years ago

Dan,

How come you caught these Shenanigans and the city council whose job it is did not?
Doesn’t one of the Councilors work as an accountant?

B. Clairmont
B. Clairmont
Reply to  take the money & run
9 years ago

I’m the one that DID bring up the new growth question at the council meeting. Please watch the tape.

Barry

Spider
Spider
9 years ago

I hope the full CC will follow the advice and vote of the O & R Committee tonight and vote NO on the petition to allow the CC to increase school dept. budgets.

Aren’t they already disgustingly and excessively high enough?

Do C

Spider
Spider
9 years ago

And continuing……Do Cotton and Yon really believe the school budgets are lacking?

dusty
dusty
9 years ago

So who exactly is responsible for the “new growth” figure?. Really..what is this persons name, what dept does he or she work in and who OK’s the figures?

History shows that it is almost impossible to shame politicians but whomever put these figures out there must feel they are right and so should not be afraid to stand up and say…It was me”.

And also, who is the city treasurer. Is Kiley gone or still there in spirit.

Still wondering
Still wondering
9 years ago

There is an interesting trend happening in the city’s real estate market. Dozens and dozens of homes are coming on the market right now. This is unusual and bears looking into. One reason is that many of them are foreclosures.
People are leaving Pittsfield and many of them are abandoning their homes to do it!

dusty
dusty
Reply to  Still wondering
9 years ago

maybe the city can succeed from itself

Scott
Scott
9 years ago

New growth huh. If it’s illegal for the stock market to fudge growth it should be likewise for cities. What’s happening is they’re bailing out water with a coffe mug on a sinking ship and lying to the suckers like me living here and paying taxes.

Zen
Zen
Reply to  Scott
9 years ago

I guess in gov’t there is no accountability for questionable accounting practices! How they can get away with this is beyond me.

Smoky Furguson
Smoky Furguson
9 years ago

Progressive government (code for more taxes) and Councilors like LOw and Krol with a Mayor who likes to spend, is a formula for disaster.

Jonathan Melle
Jonathan Melle
9 years ago

I find it amusing that Pittsfield lists even one penny in new growth when its population is shrinking by thousands of people. The only areas of new growth in Pittsfield politics is its bloated budget, high taxes, and welfare caseloads.

Zen
Zen
Reply to  Jonathan Melle
9 years ago

And shootings too!

Zen
Zen
9 years ago

Dan, love the Uriah Heep reference. One of my favorite bands way back when. The city is definitely being run by “Demons and Wizards”.

Zen
Zen
9 years ago

The Mayor
By Lying Heep

He was the mayor of a thousand lies
And I chanced to vote for him one night, wondering
He told us tales, while he bullied and whined
Me and my lyin’ mayor, kinda feelin’ jived
He had a cloak of deceipt
And eyes of a liar
And as he spoke I felt a deep desire
To free myself of his fear mongering
And promise myself to never vote for him again

Sheriff Dawg
Sheriff Dawg
9 years ago

Finally an explanation for something thats bugged me for a while. We have Prop 21/2 but every year we are hit with 5 per cent tax raise. Why and how I would wonder,..new growth or should I say “new growth” is how. Thank you Planet.

Lenny
Lenny
Reply to  Sheriff Dawg
9 years ago

Prop 2.5 doesn’t refer to your tax increases. It means the levy limit increases annually by 2.5% plus new growth as Dan has detailed today. The city and the Eagle like to point out that we are taxed (at ~ $73M) way below our levy limit (at ~$82M). During the tax rate council meeting, Councilor Clairmont pointed out that the levy limit is very close to the levy ceiling (at ~$83M). The levy ceiling is the second component of Prop 2.5 and is calculated at 2.5% of the city’s value. The city’s value is shrinking… each time a building burns down or goes non-profit it comes off the tax rolls and the city’s value. As Barry mentioned the other night, the levy ceiling continues to fall every year. If the city keeps raising the limit annually, I think we’ll be at the ceiling sooner that we think and then… finally… the voters will have a say. Because the city will not be able to tax levy us above the ceiling without the voters voting for Prop 2.5 overrides.

B. Clairmont
B. Clairmont
Reply to  Lenny
9 years ago

Lenny,

You are correct.

Barry

Jonathan Melle
Jonathan Melle
9 years ago

PROPOSTION 2.5 FACTS:

Proposition 2.5 is an “ad-valorem” tax, which means it is a tax based on the value of property.

The “Levy Ceiling”: The property tax “levy ceiling” (the amount raised) can neverpermanently exceed 2 and ½ percent of the full and fair cash value of all taxableproperty in the city or town.

The “Levy Limit”: The property tax “levy limit,” not the actual property tax levy,cannot increase from year to year by more than 2 and ½ percent, except in cases of new growth or through overrides, and in cases of debt exclusions and capital outlay expenditure exclusions.

The permanent “levy limit” will always be below, or at most, equal to the “levy ceiling.” The permanent “levy limit” may not exceed the “levy ceiling.”

A rigid definition of a “constrained community” is a community that is considered to be at its “levy limit” if its property tax levy is within one-tenth of one percent of its “levy limit.”

Proposition 2.5 is just a law, not a Constitutional Amendment, which means that it can be amended or even repealed at any time by the state legislature.