Our unincorporated city in Central California is in the process of incorporating or becoming a town. The proponents of this measure are telling the people that incorporation will not increase their taxes. However, as an opponent to this measure, I believe their will be lots of additional financial costs to the community if it is incorporated. Has anyone any idea where I can find information about a community, preferably in California, which went through this process and what were the hidden costs of incorporation?
I think a lot might depend not so much on the mere act of incorporation as on who’s providing municipal services and at what cost. Unincorporated, you’re probably depending on the county’s sheriff, EMS and fire response, water/sewer links, garbage pick-up, and so on. And you’re taxed for it. Those taxes are probably not going to go away – you can call yourself a city, but you can’t secede from the county no matter how much of its land or how many of its citizens you incorporate. So the new city is going to have to decide whether to continue to depend on the county, contract with another provider for basic services, or duplicate those services itself. These buy you different results at different costs. Very, very different, depending on what you choose.
One way to calculate: someone should have thought up a budget for the proposed city. That’s your additional tax burden. It shouldn’t be a secret, and it should be fairly specific, if incorporation is a serious issue. If taxes are not to go up, the budget will have to be offset by an equal or greater amount saved somewhere else, and that savings will actually have to be passed on to the payers (the two aren’t inseparable).
If your town plans on doing anything more substantial than running an e-mail election and buying the mayor a new hat, it’s likely going to have to borrow a lot of money to do it. Find out how much, from whom, and on what terms. How much you owe is as important as how much you spend, whether it’s your personal or civic finances.