The New Hampshire seacoast is ground zero for a citizen-led revolt against a new statewide property-tax law.
Twenty-seven "Coalition Communities," including Hanover, have joined together against what they say is an unfair taxation system. The coalition includes two towns where some residents have proposed a more radical solution: if they exhaust all other means of addressing the problem, they say they intend to secede from the state of New Hampshire.
The strongest voice in the secession effort has been that of Bettey Tobey, who runs an antique shop in Rye, a small town that lies just south of Portsmouth on New Hampshire's narrow stretch of coastline.
Tobey founded a citizens' group called TRASH (Taxpayers Revolt Against State Hi-jinks) in 1999 to fight against what she and many others perceive as a property tax that affects some towns more than others. And in a meeting last night in Rye that Tobey called "very spirited," about 80 supporters turned out to approve Tobey's proposal to file for official state recognition of TRASH, which she intends to do today. Some also contributed money toward the cause.
New Hampshire has no state income tax or sales tax, and until recently, it was one of only a few states that had no statewide property tax. But in 1997, looking for a way to fund public education, the state legislature passed such a tax -- with a "sunset provision" stipulating that the tax would expire on January 2, 2003 unless legislators made it permanent in a subsequent session. This June, they did just that.
The main resistance to the tax has come from residents of so-called "donor towns" -- communities that pay more in state property taxes they receive in aid from the state.
The Coalition Communities -- most of which are donor towns -- sued the state on the issue, claiming that the tax is unconstitutional. In January, a state Superior Court judge sided with the coalition, but in May the decision was overturned by the state Supreme Court. Now there is talk of appealing to the U.S. Supreme Court.
Donor towns are usually wealthier than non-donor towns. But Hanover Town Manager Julia Griffin explained that's not always the case.
Towns like Amherst, Bedford and Bow are relatively wealthy, she said, but they are "bedroom communities" with low total property values and high K-12 student populations. Griffin said they receive a disproportionately high amount of education funding from the state under the current tax system.
"That was part of the irony of all this: they were receiving net money from the state," she said. "We, the coalition, don't feel that it's fair."
Griffin attributed the inequity to varying standards of property revaluation, or "reval," in effect from town to town.
There are no standards for assessing properties across the state, she said, noting that statewide standards do exist in many other states. Property values, therefore, "aren't necessarily comparable," she said. "Methods will vary, unless the state has a reval system [of its own]."
Bettey Tobey traces the movement against the current system of taxation back to 1997, when the tax first became law. To protest the tax, she recalled, several citizens motored their skiff into Portsmouth harbor and dumped a chest of tea overboard in a symbolic reenactment of the 1773 Boston Tea Party.
Two years later, Tobey said, she was at the state house in Concord protesting the property tax by passing out purple ribbons to denote "sadness over the loss of our ability to govern our lives without undue state interference, including our present undemocratic situation regards [sic] disproportionate taxation," according to a message that accompanies the ribbons.
Governor Jeanne Shaheen walked by Tobey, saw the name "TRASH" on the box of ribbons and asked Tobey what it meant.
"That's your taxation plan -- trash," Tobey replied.
In November 1999, acting on the wishes of residents like her, officials in both Rye and nearby Newington voted not to pay the statewide property tax and instead to place the money in escrow until the towns and the state could work to find a solution.
In both towns, a substantial number of residents have backed the tax revolt. Fifty-two Newington citizens and over 100 Rye residents have even gone so far as to sign petitions demanding secession from the state.
The petitions are based on Article 10 of the New Hampshire Constitution. Titled "Right of Revolution," the article states in part: "... whenever the ends of government are perverted, and public liberty manifestly endangered, and all other means of redress are ineffectual, the people may, and of right ought to reform the old, or establish a new government."
Richard Hesse, a professor emeritus at Franklin Pierce Law Center, was quoted in the New Hampshire Sunday News as saying Article 10 does not apply because "all other means of redress" have not been exhausted.
"If one had the right to revolt every time they were unhappy with what the state did, then we would have perpetual chaos," Hesse told the Sunday News.
Tobey concedes that not all the "means of redress" have been exhausted, but says she disagrees with Hesse.
"The New Hampshire court system is bad," she said, asserting the citizens' right to revolt. "That professor needs to go back to law school."
If TRASH does exhaust all its "means of redress," Tobey said, secession is a very real option.
"Hopefully there are intermediate steps to achieve redress," she said. But she said that TRASH's threat of secession is "not a scare tactic. It's for real."
"Secession is radical," she acknowledged, but she called her desire for Rye to do so "carefully considered."
"This is darn serious business," she said. "How can we trust legislators to go back and do things differently?"
"We've been butting our heads against the wall till, the fact is, we've got a lot of bruises to show for it," Tobey told the New Hampshire Sunday News.
If Rye residents do go ahead with the decision to secede, Tobey said, she would put the town's chance of success at "fifty-fifty." But she allows things may not need to go that far. Citizens may convince the state legislature to repeal the tax.
"New Hampshire may decide we're too valuable to lose," she said.
Tobey said that she supports educational funding, but added that she believes every community has different educational needs, and that the current system of funding schools through the statewide property tax doesn't meet those needs.
Instead, she said, "we can find money in the government" to pay for education, money that's currently tied up in other, less essential programs.
Portsmouth mayor Evelyn Sirrell is another supporter of the tax revolt. While she does not favor secession for Portsmouth, she said she is organizing a political action committee to find ways to represent her city's tax interests in the state legislature. This would include hiring a lobbyist to try to get legislators to see things their way.
Sirrell estimates the cost of such a committee at $100,000, but says it would be well worth it.
"I haven't gotten the approval from my councilors," she said, but anticipates having their support, since they were with her in their decision to join the Coalition Communities.
"This is something that can be done now," she said. "We're in a really bad way right now."
Seacoast residents seem to agree that the current tax system is unfair, although only a minority supports secession.
Bob Dillon, a resident of nearby Stratham, said he can understand where Rye and Newington residents are coming from.
"It's an expression of frustration because of the legislature," he said. "[Secession] is not the right idea. It's better to fix the system. ... Most people think it's futile."
Tobey, meanwhile, remains adamant. She is unsure what would happen to Rye and Newington if they did secede, but she said they are considering a range of possibilities, from becoming an independent U.S. possession to becoming part of another state such as Alaska.
"I'm not a born loser," she said. "If I can help it, we can make a change."
