This is regarding Virgin Islands land value assessments. Once all the errors are cleared up, where will we stand?
I am glad to be resting from my term in the senate, but right now I wish I were in there to be dealing with this land tax issue. We hosted town meetings in September through December 2005, but were too early to garner sustained, wide interest. The wolf was not yet at our doors. We knew that a crucial crossroads would be reached when the delegate won or lost her bill to repeal the offending 1936 law that prevented the V.I. from crafting its own, fair, land taxation system. The delegate prevailed, and the day that happened, we needed to get to work crafting a fair and sensible land taxation system.
It is much more than choosing a millage rate. We must craft a taxation system that 1) raises the $100 million or so called for by the budget, and 2) protects the stability of the community.
Raising $100 million is easy: just add up all the assessed property values in the territory and divide that into $100 million. The fraction you get is the millage rate. Each property owner multiplies the assessed value of his/her property by the millage rate, and that’s his/her tax bill.
You might think that this is fair, but it’s not. The reason is because some people’s assessed values have gone up by two times, whereas others have gone up by 10 times. If the old bill was $1,000, the new bill will either be $2,000 (painful but bearable), or $10,000 (out of sight for a retired person on a fixed income).
The reason that straight millage is not fair is that it forces people who have a high assessed value to sell their home and move to somewhere else (the states?
Dominican Republic?). They can’t pay the V.I. taxes, but they sure can sell it for the assessed value and leave the Virgin Islands with a windfall profit.
Does this sound like something that a Virgin Islander wants to do? No, I don’t think so either. Virgin Islanders build a home and live in it for a lifetime, cherishing their home and bequeathing it to their children.
Does this sound like something that a land speculator wants to do? Yes, it is. Land speculators find any place where land is skyrocketing. They buy…hold for a few years…then sell at a profit. During that time, they don’t care about the infrastructure or the culture of where they are.
Fellow Virgin Islanders, please heed this warning from a man who lived in a Pennsylvania boom area for nine years: if the local people in a boom area do not forcefully assert their control over the growth, they will not recognize their home in a decade or so.
Working with the executive branch, our senate must come up with a land taxation system that will raise the necessary revenues without forcing people out of their homes.
It can be done. California, Vermont, and Florida have all been hit just as hard as the Virgin Islands by rising land values. They have found solutions.
One solution is that a landowner’s land tax is fixed at the time of purchase. Then when the land is sold, it is assessed at current value, and the tax jumps up. So simple.
Another is a series of exemptions: homestead, agricultural, senior citizen, fixed income, green space.
There are literally dozens of ways of creating a tax system. We must choose one that suits us.
I’m not in the senate now, but I’ll pass on my work to the present legislators. Here are the principles that the St. John community came up with that need to go into a new land tax system:
– No one should ever be forced from their land due to taxes that rise much faster than inflation.
– St. John should remain a diverse community, with all ethnicities, races, age groups, occupations and income levels.
– People should be assessed and taxed according to uniform and consistent methods; everyone should be able to see the rules by which their assessment is calculated.
Good luck to our senate, our executive branch, and to us all. Let us be collect the money we need to provide government services, while safeguarding people in their homes.