New Poll Shows Dissatisfaction with City’s Financial Management, But Some Support for Income Tax

Monday, April 23, 2018, 7:43 am
By: 
Alice Dreger

Results of a new telephone poll of East Lansing voters suggests citizens are generally satisfied with the services the City provides but unhappy with financial management of the City. The poll, commissioned by the City of East Lansing, also indicates more support for an income tax than for increases in property taxes.

EPIC MRA conducted the poll of 300 individuals who, when reached by landline or cell phone, self-identified as registered East Lansing voters who are likely to vote. The City provided the results late on Friday.

The poll was conducted as part of City Council’s continuing interest in finding out what residents want to see in terms of budget cuts and new taxes as the City faces a mounting financial crisis. City Council has made clear that the City cannot manage the crisis without finding new sources of revenue.

 
Majority dissatisfaction with the City’s financial management

The 300 individuals administered the full survey were asked near the start of the poll, “Overall, do you think the City of East Lansing is headed in the right direction, or, do you think that things are pretty seriously off on the wrong track?” To this, 42% answered “wrong track,” 31% answered “right direction,” and 27% were undecided or declined to answer.

Asked, “Overall, how would you rate the job that the East Lansing City Council and Administration have done in managing the City’s finances?” only 4% said excellent, 31% said pretty good, 32% said fair, 24% said poor, with 9% undecided or declining to answer.

That comes to 56% negatively rating the City’s financial management, and 35% positively rating it.

Respondents were also asked, in a later portion of the poll, why they might vote “no” on a City income tax, and here voters named financial mismanagement as their top reason, with 29% naming some combination of “wasteful spending – ineffective budget – distrust City Government management of funds.”

This was far and away the most common reason given, with the next highest category, at 12%, being “tax increase – taxes are too high.” The question about why voters might vote “no” was open-ended, so respondents volunteered the responses without specific options being presented.

 
The Mayor sees the problem as one of communication

In the view of Mayor Mark Meadows, the problem here is one of communication. “We need to do a better job of providing information to citizens on the ‘why’ and ‘how’ of our decision-making,” Meadows said in a press release about the poll results.

He went on: “It’s important for residents to have a full, factual understanding of the challenges we are facing as we work toward identifying potential solutions, but, particularly now that also means we must communicate about difficult things that can, at times, put the City’s finances in a less than positive light.”

 
Majority satisfaction with City’s provision of services

When asked to “rate the job the City of East Lansing does in providing basic city services to its residents,” 28% of poll respondents rated it excellent, 53% pretty good, 14% fair, 3% poor, and 2% were undecided or declined to answer.

That comes to 81% feeling positive about the City’s provision of services, with only 17% feeling negative.

Asked whether they believe local taxes and fees compare to the services received, a total of 47% said they were about right. By contrast, 43% said they were too high, 5% said too low, and 5% were undecided or declined to answer.

 
An income tax is preferred over a property tax increase, and dedicating funds is preferred

When asked whether they would support a property tax increase that would result in East Lansing property owners paying about $270 more per year for every $50,000 in taxable value, 68% indicated to pollsters they’d be likely to vote “no” on such an increase, with 25% leaning “yes.”

Taxable value is about half of market value, so respondents who are property owners may have thought this hypothetical tax increase would cost them twice what it really would. Nevertheless, consistently throughout the poll, respondents favored an income tax over a property tax increase. Respondents preferred doing a limited income tax, for example, for no longer than 12 years unless voters approved an extension.

When first asked about an income tax in the poll, 57% of respondents leaned yes and 35% leaned no, with 8% undecided or not willing to answer. The income tax that was defeated in November saw a “no” vote of about 53% and a yes vote of about 46%.

When offered more information about a hypothetical income tax proposal, including what it could achieve in terms of maintaining public safety and services, paying for pensions and retiree health insurance, and fixing roads and sidewalks, the number leaning in favor of an income tax went up from 57% to 65%, and those against dropped from 35% to 30%.

 
What do respondents want to see funds spent on?

Respondents to the poll tended to support new taxes if they are dedicated to specific needs. They favored dedicating funds to infrastructure maintenance and improvement (city facilities, roads, sidewalks, sewers, water) and to police and fire services. Less popular were the ideas of dedicating new revenue to unfunded pension liabilities and Parks & Rec.

Yet when provided some information about the City’s pension obligations and the impact they are having on the yearly budget, a majority (58%) said “It is important to maintain existing city services and programs, and to keep our commitment to retired City employees to fund their pensions and health insurance costs, even if that it [sic] means having to pay higher taxes to generate more revenue.”

By contrast, 29% said taxes should be kept “as low as possible, even if it means reducing City services and programs, and changing the pension commitments made to retired City employees.”

 
Was the poll representative of people who are likely to vote in an August election?

The press release provided in conjunction with the poll results described the poll as a “15-minute survey.” But the length and density of the poll may have limited who remained on the phone and took it all the way through – and only those who completed it had their responses counted. (One ELi reader reported hanging up after 15 minutes of questioning and having the pollster call back to get him to finish the poll, which took about another 15 minutes.)

The City’s press release described the 300 people who took the poll as “random.” But the data suggest the group may not be representative of who will vote. Almost half (49%) indicated they had post-college-graduate education, 53% were aged 65 and up, and 25% had a household income of over $150,000.

The proportion of respondents aged 65 and up was much higher on this survey (53%) than on City phone surveys conducted in 2012 (20%) and 2014 (19%), although that may be because this poll was limited to registered East Lansing voters who say they are likely to vote.

As noted above, questions getting at the likelihood of passing new taxes were preceded with the pollster providing a fair bit of information about the pension debt and its growing impact on the City’s budget—more information than voters would have given to them at the ballot box.

Related:

EPIC MRA poll and the responses received, as released by the City

ELi’s November 2017 survey asking why readers voted yes or no on the income tax

ELi’s reporting on local taxes and City finances

 

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