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Curriculum Center Browse Bibliography Build EPacket Pricing Structure Distribution Process Management Control in Nonprofit Organizations
 
To Charge or Not to Charge . . .
Author(s):
Young, David W.
Functional Area(s):
   General Management
   Management Control Systems
Setting(s):
   Nonprofit
Difficulty Level: Beginner
Pages: 8
Teaching Note: Not Available. 
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First Page and the Assignment Questions:
On June 13, 2005, the Boston Globe published the following opinion piece on its Op-Ed page. Several reactions to it, follow, including a rebuttal by the original author to one of the criticisms.

Assignment

1. What is your opinion on the subject of user fees? When should they be used? When not?

2.    What is the philosophical basis for your opinion?

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DON’T BELIEVE THE SCARE TACTICS: THERE ARE BETTER SOLUTIONS THAN A PROP 2 1/2 OVERRIDE
David W. Young, D.B.A.

     It’s override season in cities and towns across the state. Once again, we are being told that a failure to override Proposition 2 1/2 will mean that schools will be forced to cut athletic budgets, reduce maintenance and custodial services, layoff school nurses, eliminate talented and gifted programs, and cease providing tutors. Other scare tactics include closing libraries, operating inadequately staffed fire departments, and other similar moves, usually accompanied by such apocalyptic modifiers as “devastating,” “disastrous,” or “catastrophic.”

    But it’s nonsense. All of it.

    We don’t need to override Proposition 2 1/2.. And, without an override, there is no need to cut programs, people, and services. We don’t even need the level of property taxes that we now pay.

    It’s time for city and town officials to get creative. It’s time to eliminate the massive cross-subsidization that exists in our schools, and other municipal services. Think of who subsidizes whom in our cities and towns:

•    Schools: families with no children subsidize families with children; families with a few children subsidize families with many children

•    High school athletics: nerds subsidize athletes; females subsidize males (think of the cost of the football program)

•    Talented and gifted programs: athletes subsidize nerds.

•    Trash pickup: small abstemious families subsidize big wasteful families

•    Fire protection: safety conscious people subsidize careless people.
 
•    Snowplowing: people who live in apartments (minimal street frontage on a per-person basis) subsidize people in single-family homes; people with narrow frontage subsidize people with wide frontage.

    In instances where there’s a benefit that accrues to the whole city or town, the use of property tax revenue to pay for a service makes sense. Most of us with no children in the public school system, for example, are happy to have our property taxes subsidize K-12 education, since it benefits the entire community. The same goes for public safety, and a number of other services.