Should you be concerned about the new taxes the Blue Ribbon Commission wants to impose?

When a new tax is imposed on a municipality everyone’s first reaction is, “How will this affect me?” Obviously, the more directly an individual or business is affected the more interest they take in understanding the causes and consequences of the taxation. What is difficult to discern though is how some charges, fees and taxes (really, they are all taxes since it’s revenue to the town) will impact you.

Case in point: Torrington’s Blue Ribbon Commission is considering a few new taxes that vary in how they would appear to directly affect various groups.

The first tax is being presented as a trash “pay as you throw” system in the form of having to buy specific bags to use to throw your garbage out.

The second tax is being presented as a “landlord licensing fee”, presumably anyone interested in renting out property would have to pay this license fee (tax) before commencing business and possibly at regular intervals “renew” their license.

The third tax is being presented as an “apartment inspection fee” prior to allowing a unit to be occupied.

Now let’s take a look at how these taxes would affect a typical resident of Torrington renting a home in town:

I am a tenant….why should I care about trash fees?

First of all, the ‘pay as you throw’ trash collection idea that the mayor’s Blue Ribbon
Commission (BRC) has been looking at affects everybody….property owners and
renters alike.

Simply put, the system requires residents purchase special garbage bags at a cost
of $2.00 to $3.00 each to throw out their trash. There are several different methods
the city can use for enforcement and fines would be issued for non-compliance.

The end result…this is a back door tax increase being disguised as a trash
fee. This will be just another burden, in many cases on families that are just barely
making ends meet now. In addition, there is no doubt we will see a proliferation
of illegal dumping all over the city by those who simply can’t afford to purchase
these bags or pay the fines.

I am a tenant….why should I care about landlord license fees?

Short Term – You will either see a rent increase or a decrease in services/
maintenance provided by your landlord. As with the trash collection fees, this is
simply another back door tax increase being disguised as a landlord license
fee.

Why? With profit margins already sliced very thin by last year’s property tax
increase (in many cases it was anywhere from 20-30%), landlords simply can’t
afford to absorb additional fees. If the market will not bear a rent increase,
landlords will be forced to cut corners elsewhere.

Long Term – You will see a decline in available rental units. Based on the
principal of supply and demand, this will ultimately lead to higher rents.

Why? – The fact is that many small mom and pop landlords will simply take their
units out of the rental market. There are many owner occupied two families in
Torrington where the owner lives in one unit and they rent out the second unit.
Many of these mom and pop landlords have made it clear they would rather leave
their second units vacant, rather than deal with increased burdens imposed by the
city.

In addition, there are still record numbers of foreclosures coming on the market.
A large number of those are multi-family homes. Typically those homes are
purchased by investors who renovate these buildings and then rent the renovated
apartments. If the city makes it more difficult to own rental property in Torrington,
potential landlords will simply avoid Torrington and purchase properties in other
communities. This will leave those foreclosed building sitting vacant, meaning
fewer available apartments. Again, based on the principals of supply and
demand, this leads to higher rents.

I am a tenant….aren’t mandatory property inspections to my benefit?

No – These property inspections require a fee be paid to the city. This too, is
another back door tax increase being disguised as a property inspection fee.
This is bad for tenants for all the same reasons cited under landlord license fees.

Won’t mandatory property inspections lead to better quality housing?

No – If there are health, safety or fire hazard issues with your apartment/building,
you can call the city building department, health department or the fire marshal’s
office now. In fact the fire marshal already inspects all buildings with three units
or more. The fact is that the infrastructure is already in place to ensure your
apartment/building is a safe and healthy place to live.

Taken individually or collectively, these fees, inspections, etc. are simply a way
for the city to enact a back door tax on the very people in our community who
can least afford it.

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