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Column: Tax composition renders most of state unattractive to residents




Having lived and worked in three different states during the past decade, I have had occasion to watch the way local government operates. In particular, I am interested in how state policy influences the goodness or badness of local government.

I start in West Virginia, where I lived a decade ago.

The Mountain State decided in the 1930s to make most budget decisions at the state level. All but a tiny share of property taxes are collected by the legislature and distributed back to local governments using an opaque formula. The legislature, in its munificence, holds about a quarter of total tax revenue in a single large fund it carefully doles out in special earmarks.

 

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