After a supreme court ruling, long delay, and plenty of discussion, Houston’s rain tax will be on the ballot again this November. Yet surprisingly, regardless of the election’s outcome, the tax is going to stay.

The tax was originally approved in 2010 by a slim margin, and was sold to voters as a pay-as-you-go fee to fund street, drainage, and flooding repairs. However, shortly after its passage, taxpayers sued alleging misleading ballot language. They prevailed, but though the Supreme Court of Texas ordered a new election, the city has continued to collect the tax in the meantime.

The city has long maintained they could continue to levy the tax because state law provides the ability to collect a drainage fee and city council, not the voters, imposed the fee through the passage of an ordinance. The city alleged that voters voted only on the “lock box” mechanism that would dedicate those funds to a specific purpose.

Apparently the upcoming November election will again only affect this mechanism and not the actual tax itself. Mayor Sylvester Turner has said November will decide whether to keep the funding stream going to the lock box or relinquish it to the general fund. There have long been concerns that the “lock box” isn’t actually locked and funding has been diverted to pay for salaries and other expenditures not directly related to the purpose of the fund.

Turner has said that regardless of what voters decide, his administration will continue to put the money in the lock box for the time being. If the election measure fails, however, that same guarantee can’t be made for future administrations.

“It places the dollars in a lock box for a dedicated purpose: streets, flooding, drainage,” he said. “If you vote no, you’re removing the lock box, any administration, this administration, can use those dollars for general purpose, general funds.”

From all appearances, the prudent thing to do in November might be to vote “yes.” Passage would ensure that funds collected for streets, drainage, and flooding remain dedicated to that cause rather than diverted elsewhere. A “no” vote on the other hand, some argue, will allow taxpayers a mulligan and create a new “lockbox” that genuinely serves its purposes and doesn’t allow funds to be misspent.

If taxpayers decide to support it, they should know a “yes” vote alone isn’t enough.

Bill King, columnist and former Mayor of Kemah, wrote, “Engineers grossly underestimated the ability of City officials to find loopholes in their ‘lockbox’ and their willingness to blatantly ignore the charter amendment language.” Since taxpayers don’t seem to have the option to do away with the tax entirely, it’s going to take stricter oversight to make sure the dollars are spent to actually improve the intended areas instead of on pork disguised as infrastructure repairs and maintenance.

Charles Blain

Charles Blain is the president of Urban Reform and Urban Reform Institute. A native of New Jersey, he is based in Houston and writes on municipal finance and other urban issues.


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