Poughkeepsie Journal's Mistakes in Gathering Tax Data

This is the third of three blog posts on the Poughkeepsie Journal's January 11 feature story Most cities, towns cut spending, raise taxes to balance the books by reporter John Davis.  That story contained a city/town tax table and sidebar (in the print edition only, unfortunately) with mistakes in each of these three steps:

1. Get accurate data.
2. Determine the correct way to analyze the data.
3. Do the arithmetic correctly.

My first blog post, Poughkeepsie Journal's Incorrect Tax Rate Analysis, discussed a serious error in Item 2 — Determining the correct way to analyze the data.  My second post discussed mistakes in Item 3 — Doing the arithmetic correctly.  This post discusses mistakes in Item 1 — Getting accurate data.

What Is the Most Authoritative Source for Property Tax Data?

According to the Dutchess County Charter, the county government's Real Property Tax Service Agency (RPTSA) is responsible for preparing tax rates for the county, towns, and special districts.  RPTSA also prepares property tax bills and tax rolls.  The fact that the RPTSA prepares all these documents means that the tax data published each year by the RPTSA corresponds exactly to the taxes paid by property owners.  So if you want the tax rate increases actually paid by property owners in any Dutchess County town or city, you use the RPTSA data.

Town/City Tax Rates Using RPTSA Data

I've used the RPTSA data to compile a table of tax rate changes for towns and cities in Dutchess County.  My table is here.  It wasn't hard to make.  You can easily make one yourself, or use the RPTSA website to check my work.  Here's what I did:

1. I copied the 2009 and 2010 tax levy, assessed value, and equalization rate data (orange column headings) from the RPTSA tax rate pamphlets.  
2. I calculated each tax rate per $K of assessed value by dividing the tax levy by the assessed value.  Next, I calculated the tax rate per $K of market value by multiplying the tax rate per $K of assessed value by the equalization rate.  Finally, I calculated the percent change in tax rate from the 2009 and 2010 tax rates per $K of market value. All my calculations (grey column headings) are to 15 significant figures, but results are displayed to only 3 or 4 significant figures for presentation.
3. I copied the Poughkeepsie Journal's tax rate increase (blue column heading) from their table.
4. I calculated the difference between my tax rate increase and the Poughkeepsie Journal's (grey column heading).

Note that I did not copy the tax rates from the RPTSA tax rate pamphlets, because the pamphlets only display these rates to the nearest cent.  By recalculating the tax rates from tax levies and assessed values, I got the high-precision tax rates necessary for accurate tax rate increases (and also necessary for accurate tax bills!).

Eight towns in Dutchess County contain villages with separate tax rates.  I've followed the Poughkeepsie Journal's lead in showing only the rates for outside the villages, marked with suffix “- o”.  (The Journal has only marked two of them.) Two towns and two cities have separate tax rates for homestead and non-homestead (commercial) properties.  I've shown only the homestead rates, marked with suffix “- h”.

Poughkeepsie Journal's Tax Data Is at Variance with RPTSA

There is little in common between the Poughkeepsie Journal's figures and the RPTSA figures.  The Journal's tax levy figures fail to match the RPTSA tax levy figures in all but two towns (Pine Plains and Stanford).  More importantly, the Journal's tax rate figures differ noticeably from the RPTSA tax rate figures in all but five towns (Beekman, Fishkill, LaGrange, North East, and Poughkeepsie).

It should be noted that the RPTSA had not yet published the 2010 tax rate pamphlet before the Poughkeepsie Journal's January 11 story was written.  However, the RPTSA had published the 2010 tax rolls, which contain the same high-precision 2010 tax rates.  So the essential data was available.

What Were the Sources of the Poughkeepsie Journal's Tax Data?

As noted in my previous two posts on this story, I have not been able to determine for sure where the Poughkeepsie Journal got its data, because Journal management has denied my request to speak with whoever prepared the story's tax table.  But the fact that there's so little in common between the Poughkeepsie Journal's table and the RPTSA's figures leads one to suspect that the Journal used other sources.

Other sources may include the websites of towns, which sometimes display property tax data.  In my experience, this data tends to be different from the RPTSA data, sometimes markedly.  There can be many legitimate reasons for these differences.  As just one example, the RPTSA sometimes must adjust tax levies submitted by towns to account for tax delinquencies from the previous year.

Cost Shifting

For a few towns, a formal comparison between 2009 and 2010 tax rates, as in my table, is misleading, because of cost shifting between town budgets and other government budgets.  When looking at tax rate increases, it makes more sense to take this cost shifting into account.  To the Poughkeepsie Journal's credit, its figures appear to take this cost shifting into account for the Town of Red Hook.  However, the Town of Beekman also has a significant cost shifting issue, which the Journal does not seem to have taken into account.

Summary of My Critiques

The Poughkeepsie Journal's January 11 feature story provided a table of tax rate and tax rate change information for all 20 of Dutchess County's towns as well as the cities of Beacon and Poughkeepsie (in the print edition only).  It's great that the Poughkeepsie Journal seeks to focus so much attention on these parameters, which are key to informing property taxpayers and government officials about what's happening with their taxes.  Unfortunately, the story's tax table is deeply flawed, so that the figures in the tax table cannot be relied upon.  My three posts about this story describe three different kinds of flaws.  This post describes the Poughkeepsie Journal's failure to start with authoritative tax data, my first post describes its failure to take into account changes in equalization rate, and my second post describes its failure to use high-precision arithmetic.  The cumulative effect of these mistakes is that almost every tax rate change in the Poughkeepsie Journal's story is inaccurate, in many cases by a large amount.  A different Poughkeepsie Journal reporter also failed to use high-precision arithmetic in a story a month earlier, as noted in this blog.  There would seem to be a need to improve the oversight of property tax reporting at the Poughkeepsie Journal.  I would certainly like to encourage this outcome.