This makes sense to me. Figure the revenue is driven by change in ownership triggering a higher tax basis – and there is also some new property too. The retired couple sells the SFR to move into a condo or assisted living place, and that may double or triple the tax basis on that property. And even though sales are off from the peak, they are still pretty decent in both valuation and volume from a long term perspective. Also, this revenue stream includes commercial as well as residential so gotta look at that too – new tanks at the gas station? A face lift at the strip mall? A new medical office building? All that figures into the equation. Plus all that stuff that hasn’t changed hands in decades still gets the 2% bump each year, right?
The big “ah ha!” for me is how this is another crystal clear data point demonstrating that we have a spending problem and not a revenue problem. Pensions, corrections and schools are the areas where spending increases have been the greatest – and the citizens are not getting value for money in any of these areas. State Employee unions are driving it – basically holding the politicians hostage by threatening to block-vote them out of office unless they play along. Welcome to clientelismo third world government.
