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September 4, 2018

A Sign Forecasting Future Spending

Jason Miller

Many small towns in America are competing for businesses in the name of economic development. In the quest for growing local entrepreneurship, beautification efforts can be a cheap and effective way to attract new additions to local commerce. The town of Thurmont is no exception.

 

Anyone who follows Thurmont's Mayor John A. Kinnaird on social media knows that he loves his town. He promotes local businesses and is out talking to people on a regular basis. He conducts himself with a style that instills pride in the community he holds most dear.

 

That said, Mayor Kinnaird seems to be in an uncomfortable position after the Frederick News Post (FNP) ran an article criticizing the cost of two new "Welcome to Thurmont” signs paid for by the town. A justification for the price tag of a little over $15,000.00 per sign would be a herculean task under normal conditions. The $30,340 total cost for both signs, along with a newly implemented tax increase of two cents per $100 in property assessed value, has some Thurmont residents asking questions about the fiscal logic in the decision.

 

The News=Post article of August 29 showcased the fact that Town Commissioner Marty Burns had argued against the signs being installed as a textbook case of wasteful government spending. Former Mayor Burns was quoted as saying the money for the signs could have been better spent on "the town’s drug abuse problem, bridge rehabilitation, roads, debt, or retirement obligations."

 

The FNP reporter never spoke to Mayor Kinnaird about the signs according to the mayor’s own comments on the News-Posts website posted with the story. Mr. Kinnaird addressed what he considered to be a disservice in reporting the story and reminded the FNP that Town Commissioner Burns was the only voice opposing the installation of the signs.

 

Mayor Kinnaird also pointed out that Commissioner Burns was the only interview conducted by the FNP. Commissioner Burns had been for the multiple sign installations when he voted in 2017 for a town budget that included the signs as an approved expense. Mayor Kinnaird went on to confirm that more sign purchases had been authorized, but that only two were actually purchased in 2018.

 

He continued by saying that the 2018 tax increases did not pay for the 2017 budget and that "Commissioner Burns indicated during the 2017 discussions that the town should pay for the signs as a demonstration of “having skin in the game” when it comes to applying for grants related to economic development."

 

Mayor Kinnaird stated later, on social media, that "our taxes did go up by two cents per hundred dollars of assessed value because of the increased costs of everything and due to the fact that our property tax revenue has been flat for several years."

 

The necessity for signs in this case is not in question. Every town should have a warm and inviting sign that welcomes travelers into its limits. What is in question are the costs associated with the two signs that were purchased. It's hard to justify a tax increase under the auspices of increased municipal costs when wasted tax dollars are personified in the form of two newly installed Thurmont welcome signs.

 

If welcome signs spurred local economic growth, every municipal government in the United States would change their welcome signs like their tax payers change their socks. Trade unions would have workshops on municipal signage and their effects on emerging markets. National business think tanks would be on a quest for the perfect sign.

 

Yet right now there is absolutely no sound correlated evidence or data that suggests welcome signs spur economic growth in villages or towns. Tax cuts do. Low taxes have always spurred economic growth in business markets. Increased profits in small communities are attractive to entrepreneurs plagued with high taxes eating into their profit margins. If Thurmont wants economic growth, town leadership should revisit its property tax increase.

 

Having a history of flat taxes is an incentive for some businesses to relocate. Local businesses appreciate a consistent taxing authority that understands the concept of overhead costs. Low town taxes and efficient town spending is a welcoming sign to almost any business seeking a place to locate.

 

Thurmont leadership should adopt a more pragmatic approach on future town beautification efforts. There is no debating the value of beautification efforts in attracting economic development. However, potential new businesses might see the inefficient use of taxes as a sign of future spending habits that could diminish any businesses’ bottom line.

 



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