Forenote: There will be an extra News Guy posting tomorrow, Thursday (as well as the usual Friday posting), along with an announcement about some new developments at the web site which we trust will be received favorably.

Actually, it might be more accurate to consider today’s post the “extra” one. Tomorrow’s will have more news; what follows is a bit of musing on Vermont and consistency.

Back in the day, Sen. Russell Long, the Louisiana Democrat who chaired the Senate Finance Committee for a century or so, used to sum up the average person’s attitude toward taxation as follows: “Don’t tax you, don’t tax me, tax that fellow behind the tree.”

Bad poetry, but good political analysis.

As Vermonters are now learning (and proving), the same phenomenon applies to spending. From Gov. Jim Douglas on down, the attitude of the body politic is: “Cut the other guy to the bone, but leave my favorite program alone.”

Poetry no better. Perspicacity identical.

Exhibit A comes right from the top. For years, Vermont farmers and woodland owners have gotten a tax break thanks to the “current use” tax assessment. Nobody opposes this policy in principle; it’s kept thousands of acres open and green by removing an incentive for landowners to sell to developers.

But it’s also expensive.

According to whom?

According to the Douglas Administration, whose tax commissioner, Richard Westman, just a few weeks ago identified the Current Use policy as one reason everybody else’s property taxes keep rising.

As it happens, over the last year or so, the various “stakeholders” of Current Use – farmers, foresters, environmentalists, local officials – have been meeting to try to figure out a way to get a little more money for the state treasury without seriously diminishing the advantage to landowners.

And they succeeded. Or at least most of them thought they did, and they presented the Legislature with a plan that would bring in another $1.6 million in revenue.

Oh, no, said the Douglas Administration, represented in this case by Agency of Natural Resources Secretary Jonathan Wood. Yeah, we need money. We’re $150 million in the hole. But we don’t want money from these landowners because…well, because it’s a good program, Wood said.

Yeah, but they’re all good programs. Maybe what he really meant was—These are our friends.

Then there was the Governor’s major power play to get a special Legislative Board to approve spending several more million dollars for one of his pet programs even as he insists on cutting almost everything else. This was the cap-raising of the Vermont Economic Growth Incentive . (See VEGI Burgher,” the January 13 post)

Assume for the sake of discussion that this, too, is a valuable program. But it never seemed to have occurred to Douglas to apply the same standards to it that he wants imposed on other agencies—spend less than you have in your budget this year because we all have to tighten our belts.

Do not suppose, though, that this “cut everybody but me” attitude is limited to Douglas and his fellow Republicans. At a Democratic fund-raiser a couple of weeks ago, former Gov. Howard Dean scolded lawmakers who might be willing to consider reducing the budget of the Vermont Housing and Conservation Board.

“We need that program,” Dean said. “It is the perfect public-private partnership.”

It may be, and like Current Use, it has been useful as a conservation mechanism. But it couldn’t survive a year or two with a little less money?

The liberals are somewhat less inconsistent than the conservatives here, because some of them openly call for some targeted and temporary tax increases to help the state over its $150 million budget shortfall. But everybody agrees that programs will have to be cut.

Just not their favorites.

OK, some folks are willing to take less. State workers took a three percent pay cut. Yes, they did it under pressure and to avoid more layoffs, so it wasn’t just an act of noble sacrifice. But it was a sacrifice, as was the five percent pay cut taken by their bosses, the “exempt” state workers who earn more than $60,000 a year. The Stowe teachers agreed to give up the 5.5 percent pay hike they had negotiated for this year.

But these seem to be the exceptions. The default position for Vermont advocates left and right remains a firm and forthright conviction to cut spending. On everybody else’s programs.

Aftnote: Because the News Guy rarely misses an opportunity to ridicule or insult the Burlington Free Press when it deserves ridicule or insult, it’s only fair that the paper’s triumphs be recognized. Last Sunday alone it had three pieces of first-rate journalism: Sam Hemingway’s lead story about tritium contamination at nuclear plants nationwide, Nancy Remsen’s story about the potential impacts of state budget cuts, Candace Page’s fascinating account of niche marketing agriculture in Vermont.

Note One: If you missed Wednesday’s post because you checked in early and it wasn’t there, scroll down to read it. The system disobeyed orders. It will have to be dealt with, but that can’t happen for another week or so.

Note Two: Because a few have graciously inquired, herewith policy: The News Guy does NOT want donations from public officials or candidates, those he may have to excoriate. But thanks for the thought.

Sound the Alarm! The statewide school property tax rate is going up. It’s unprecedented. Worse, the rate isn’t going up by a penny or two. No, by 2013, so projects the Tax Commissioner, sounding the alarm in a letter to the Legislature, the increase may total 22.2 cents.

In the property tax world, that could add up to a lot of money.

So the alarm has been sounded.

And sounded. So persistently that the average Joe/Jane minding his/her business might be forgiven for thinking that the world as we know it is doomed, or at least that their property taxes will drive them to either: (a) the poor house; or (b) another state.

Joe. Jane. Calm down.

Your taxes are not necessarily going up.

First of all, these projections are just that – projections, especially that 22.2 cents estimate, which is for Fiscal Year 2013, before which a great deal can change. Like all projections, these are based on certain assumptions. The assumptions in this case seem reasonable, but (details below) at least one of them might be a bit pessimistic.

None of which is to say that your taxes are likely to go down, or even not likely to go up, as they usually do. It’s to say that the going down and the coming up don’t depend only on the rate. Or in the words of Deb Brighton, one of the policy analysts who helped Commissioner Richard Westman work out the proposed new rates, “You might end up having exactly the same tax bill,” even with higher rates.

It’s also to say that (surprise!) there is a certain amount of politics behind the tax rate rhetoric. Right now, it’s from Republicans, but do not think that Democrats don’t sometimes indulge. They did last year when they assailed then-Tax Commissioner Tom Pelham for not reducing the rate as quickly as they thought he should.

So he reduced it.

And all your property taxes went down?

Uhhh, no. Mostly they went up because the value of your property went up more than the rate went down.

Next year your actual tax payments may stay the same or decline, even as the rate goes up, because property values are going down in Vermont as they are elsewhere.

In fact, they are declining faster in most other states, which helps explain why, though Vermont’s fiscal predicament is real enough, it is less severe than in about 45 of the other states. (Check in Monday for details and elaboration).

Now, this property tax business is complicated, so complicated that were one a cynic, one might suppose the powers that be made it complicated so that the average person would have a tough time understanding it.

No such cynicism will be expressed here. But just to clear up one complication, here’s how your property value can go down (for purposes of the statewide school property tax) even if your property is not reassessed: Every year the state adjusts the grand list based on the actual prices of recent home sales in your town. If those prices go down, so does your tax bill unless the rate is raised. Hence Westman’s decision to raise it (subject, of course, to Legislative approval).

Another complication: The property tax is not the only source of revenue for the Education Fund, which pays for the schools. That Fund also gets money from other sources, especially from the General Fund, into which go most income, sales, and other taxes, out of which most operations of state government are financed.

According to Mark Perrault of the Legislature’s Joint Fiscal Office , for Fiscal Year 2008 the Legislature determined that the General Fund would transfer $280.2 million to the Education Fund that year, increasing it annually to adjust for inflation.

That’s what happened for the next year, when $291.8 million was transferred. But for this year (FY 2010), the Recession had hit. The General Fund didn’t have enough money. So the lawmakers cut $18.4 from the transfer for this year, and the same for FY 2011. The Ed Fund, then, is slated get only $240.8 million from the General Fund, less than it got two years ago.

For these two years (2010 and 2011) the burden on the property tax was eased because the Legislature funneled $38.6 million of federal stimulus money directly to the towns, Perrault said. But unless more federal money comes next year, he said, “the problem comes in FY 2012.”

True, depending, again, on assumptions. One of them is that the Feds won’t cough up more money in 2011. Another is that the Legislature won’t fatten the General Fund by raising taxes. Yet another is that total school spending will continue to go up by two percent a year.

Those first two assumptions seem on the mark. The last is a bit more questionable. Deb Brighton said she and her colleagues learned that the most recent increase was “something like 1.96 percent,” and “we had to make some assumptions, so we just agreed to assume a two percent increase to make some sense of it.”

That does make sense, but there is some reason to suspect that school costs will go up more slowly over the next few years. With the number of pupils still falling, schools all over the state are reducing staff. There were slightly fewer teachers in FY 2008 than the year before (the last statistics available), and the decline might well continue.

In his letter to the Legislature, Westman made much of the school spending matter, noting the “uninterrupted growth” of school spending, mostly “personnel costs” despite falling enrollment. Here he echoed the steady refrain of Gov. Jim Douglas and his associates who regularly call for lower school spending.

It may have been mere coincidence that just days after Westman submitted his letter, Neale Lunderville, Douglas’s Administrative Secretary, noted the three percent pay cut negotiated by the state employees union and not-very-subtly suggested that teachers consider following that example.

Or it may have been, as Darren Allen of the Vermont National Education Association said, “an orchestrated effort into bullying teachers into taking a pay cut.”

Allen, needless to say, is hardly a disinterested observer. But if it wasn’t an orchestrated effort, it was a pretty good imitation.

Either way, it might be a bood idea. It would save money for the taxpayers, most of whom earn less than most teachers. On its face, it would be sensible budget policy.

But perhaps very bad fiscal policy. In a recession as serious as this one, economic policy should aim at getting people to spend more, which they cannot do if they earn less. Prices have fallen, but by about one percent according to official government figures. So if they ratify the contract with the pay cut, some 7,000 or so state workers will suffer “real” pay cuts of two percent.

That’s Vermont’s own anti-stimulus package.

And there are more teachers than state workers. All this salary reduction might be good for the state budget and the property taxpayers, but awful for Vermont’s economy.