No Taxation Without Representation and How that Applies to Non-Resident Property Owners

No taxation without representation’ and how that applies to non-resident property owners

by Jesse Brewer

Being in the rental property business, I am required to pay many property tax bills, and given that I own real estate in neighboring counties, I am forced to pay county, city, and other taxes for these properties.  I live in Northern Kentucky, which is also part of the greater Cincinnati, Ohio region.

While I understand that I must pay taxes to these governments for schools, police, fire, and other government services for the properties I own, what I don’t get is that I have absolutely no say in how these properties are assessed, who gets to assess them, and what tax rates I must pay.

Normally, you get to have a say in these types of things when you vote for leaders in that particular community; however, since I don’t live in these municipalities, I don’t get to vote for the city council persons, county leaders, school board representatives, or other persons who determine these issues. The problem with this issue is one of the basic principles upon which our beloved United States was founded and for which we went to war to gain our independence — Taxation without Representation.

“Taxation without Representation” is defined in Dictionary.com as this: “A slogan of the Revolutionary War and the years before. The Colonists were not allowed to choose representatives to parliament in London, which passed the laws under which they were taxed. To be taxed only with the consent of one’s representatives in Parliament was a particularly cherished right of the people under English law, a right dating back to Magna Carta in the 13th century. Each additional tax caused fresh resentment among the colonists. Taxation without representation is one of the principal offenses of Britain listed in the Declaration of Independence.”

Wow. Take a moment and let that sink in. Read it again if you need too.

Being taxed without representative government to hear your voice (i.e., someone for which you vote) is a cherished right dating back to Magna Carta, but yet here we are today, being taxed six ways to Sunday with zero say about it.

I know what you may be thinking, this is all sounds good in theory but how much really can you be paying without having a say. For the purpose of trying to better explain this issue, I’m happy to share with you some of my personal numbers in this matter. I live in Boone County, Kentucky. While I own property in the county, the majority of my rental property is in Kenton County.

For the 2017 tax year, I will pay a total of $38,758.32 in property taxes to various government agencies. Now, $2,100 of that amount is paid to the state of Kentucky, and I do have a representative at the state level, so I cannot count that as not being represented. The problem becomes the other $36,658 of it.

I own property in Covington, Kentucly; therefore, I have the privilege of paying Covington public schools more than $1700 per year. I get to pay the City of Covington itself $5,189.18 and the Kenton County Fiscal Court $2,668 annually. The Kenton County Library gets $1,945.76 and another $6,625 in 911 dwelling fees also goes to Kenton County. In Newport, I have the privilege of paying that city $6,443.84 a year, plus other 911 fees, taxes to the Campbell County Library, and a slew of other taxes.

Officials elected in these areas set these tax rates. The Covington school board members are all Covington residents. The Covington Board of City Commissioners also is elected by Covington residents. Of course, Kenton County residents elect members of the Kenton County Fiscal Court. All of these elected officials get to dictate how much I get to pay, yet I have ZERO voice in their “parliament,” or in this case, their city hall, city school board, or county government. Now, I’m not a historian, but to me, the situation I just described fits the meaning of “Taxation without Representation” to a tee.

I understand that some elected officials who represent me in Boone County also represent residents in Kenton County as well. For example, we have the same Congressman, same U.S. Senators, same Governor, same state officials, such as secretary of state and others who serve in Frankfort, and I can accept that I shouldn’t get to vote for these persons multiple times.

However, wouldn’t it be fair to let people who have a vested equitable interest (real estate) in the community – taxpayers — have a right to vote on the local elected officials who can levy taxes and fees on them? No matter where they live give the only one vote for a congressman, even if the property they own is in a different congressional district, they are still being represented, give them one vote for Governor, give them one vote for US Senator and all the other federal, state and judicial offices. The only things maybe allow them to vote for are elected officials that are with the city or county, that can levy higher taxes, special fees and other related items that are attached to properties. It can even be simplified by restricting the person to their only “one vote” type offices to their home address, much like it is now.

After all, isn’t that one of the basic principles this country was created upon and one of the essential freedoms many of our ancestors died trying to obtain?

Yet, year after year this violation of our constitutional rights goes on and nobody mentions it or seems to care. I suspect that this would never happen. Not because it seems “drastic” or draconian, but because politicians would lose their ability to tax those that cannot be represented all while trying to minimize the tax burden they put on the few that can vote for them and keep them in office.

Jesse Brewer purchased his first rental property in 2003, a single family house in Newport, Kentucky that he still owns to this very day. Since then Jesse has acquired several more investment properties in his portfolio that consist of single family homes, multi-unit buildings and commercial use spaces. In 2005 Jesse earned real estate licenses in both Kentucky and Ohio so that he could begin helping others build their own cash flow real estate portfolios.  He is a member of Queen City REIA, in Cincinnati, Ohio and is a Boone County, Kentucky, Commissioner (District 3–elect).  Jesse was also featured in the Member Spotlight of the Spring, 2018 issue of the RE Journal.