In many states, city and town taxpayers must also pay county taxes since they benefit from many countywide services. In some cases, sales tax is shared among municipalities as well. These types of revenue structures sometimes lead to questions of fiscal equity. Our Fiscal Equity Studies help determine, from a municipal perspective, if the cost of services provided is commensurate with the taxes paid, and from a county perspective, if the municipalities are paying their fair share.
Such questions are being asked more frequently across the country. With TischlerBise's more than 20 years of experience dealing with fiscal issues and developing revenue strategies, we are frequently asked to evaluate such questions of fiscal equity. Two recent examples of Fiscal Equity Studies conducted by TischlerBise are provided below:
Shelby County, Tennessee
TischlerBise evaluation shows that County taxpayers subsidized services to the City of Memphis in the amount of $44,026,234 in FY98
At the request of the Commission on Alternative Futures, Shelby County contracted with TB to prepare a fiscal equity study. This study focuses on whether City of Memphis residents and businesses that pay County taxes are receiving a commensurate County expenditure for 16 selected public services.
TischlerBise's analysis showed the County subsidizes the City Schools, Sheriff, Planning and Economic Development, Health Care Centers, Health Services, The Medical Center, Jail, Corrections, Criminal/Civil Justice and Human Service Grants in the amount of $88,550,839. The City subsidizes County Schools, Memphis/Shelby County Library System, Fire and Emergency Services, Parks, Public Works, and Public Assembly Facilities and Regional Amenities in the amount of $44,524,605. The net result is an annual Shelby County subsidy of over $44 million.
TischlerBise review of County study reveals methodological flaw in the City's favor
In Clovis, California, TischlerBise has been retained by the city to evaluate a consultant study prepared for Fresno County that shows the county subsidizes the provision of countywide services to Clovis, as well as to the other municipalities in the county.
TischlerBise, working in cooperation with both the city and county, is helping both parties to understand the implications of different allocation methodologies and is analyzing the data used in the county study. Our review of the county's study has revealed a serious methodological question, which results in the City of Clovis contributing over $5 million more in revenues to the County than it receives in countywide services.