Voters of San Juan County Public Hospital District #1 are encouraged to vote YES in favor of the emergency medical services (EMS) property tax levy on their August 2 ballot replacing one that expires on December 31.
The district is in a financial crisis that can only be resolved by approval of the proposed levy of $0.50 per thousand of assessed value replacing the current levy of $0.35 expiring on December 31. (For a house assessed at $400,000, the increase is equivalent to only $5 per month.) Without a new levy at the increased rate, EMS on our island would cease operations as we know it in early 2017. Imagine who would come to your aid if you suffered a heart attack, fell off your roof, cut off a finger with a saw, or your visiting grandchild went into anaphylactic shock from a wasp sting.
Critics of the proposed levy miss the point by focusing on inflated costs, which is a problem of the past. Instead, the district’s financial crisis results from two more significant factors outside of management’s control. First, due to restrictive state law, the district suffered a $1,100,000 reduction in tax revenues in 2011-2016 due to a $678 million decline in property values. In 2016 alone, the reduction was $237,000.
This decline in tax revenue is the result of a highly prejudicial state law which regulates EMS levies differently than those of other taxing districts. Specifically, EMS is not allowed to adjust its levy rate upwards annually when property values decline in order to maintain the same amount of tax revenues collected the prior year. In contrast, the levy rates of our schools, library, fire department, Island Rec, etc. are automatically increased annually by whatever is necessary to maintain the same level of tax revenue.
State law also severely restricts the district’s ability to recover lost tax revenues whenever property values recover, instead limiting tax revenue increases to 1 percent annually. Therefore, it will be many years, if ever, before the district recovers at the current levy rate its $1,100,000 loss in tax revenues in 2010-2016, even if property value recover sharply. Although other taxing districts are subject to this same 1% annual limit, they are not subject to annual tax revenue declines (in the first place) that need to be recovered.
Secondly, the reimbursement rates paid to the district by Medicare, Medicaid, and insurance companies are far below the corresponding costs of service. Reimbursement by Medicare, which accounts for 57 percent of total reimbursements paid to the district, plus supplemental insurance, pay only $437 to the district for ALS1, a service that costs the district $1,350 to provide. The district writes off the difference for local residents, who account for 83 percent of calls. (It bills non-residents for the difference.) What other type of business could survive this inverted cost structure without substantial tax support from the community it serves?
Let’s not get any closer to the December 31 abyss. Vote YES for the EMS levy on August 2.
Dehlendorf is a San Juan Island resident.