Property Tax Increase

[Mainecoons]

That is pretty defeatist, no? Why participate in the thread at all?

That being the case, why did previous regimes fix the potholes and pick up the trash here? Why did previous regimes not allow drug and crime ridden "raves" to happen here even after a large number of people demonstrated in Chapala against them?

Why were previous governments able to maintain at least basic services here on a lot less tax revenue?

I'm also curious. Which municipality/community do you live in? Thanks.

[Hud]

Just seems to me that with some good people working with Hector to improve Ajijic and the plaza, streets, etc. and having some success with donated funds, that the "powers to be" have realized that extranjeros will provide their own source of funds for needed repairs, improvements, etc. when they seem to get fed up enough. So, why not take advantage of that, hit them up for more tax money, and put funds in other areas (pockets?), as the "community" will complain but really has no power to do anything. If they really want it done, they will pay for it. Just MHO.

[Hud]

Kinda reminds me of several years ago when we legalized a car in Nuevo Laredo. Another American was waiting outside with us for his paperwork and had been there also the afternoon before. My wife (Mexican) went inside to check on "her paperwork" and overheard the guys working in the office say " let the Gringo wait longer. He will eventually get tired and be willing to pay more to get his papers faster". They know all our "quirks".

They also know that most people who live here are not going anywhere, even though some may express that opinion at times. So, whatever it takes to stay here by most people will be paid (donated). They have us by the gonads, and they know it.

[bmh]

Yes HUD you have a very good point and now that people have demonstrated that they will fund the new

improvement are being milked for more..It would be interesting to know if all the tax increases are

applied to the wealthy Mexicans accross the board.. Love to know if all these large properties on the

lake that are used for week-ends or less are taxed equally or if most of the land is considered undevelopped,assessed differently and therefore do not get the increase..

This said my 25% increase was less than the price of 2 shingle vaccines so we have to put back everything in perspective.

[Hud]

An interesting point, bmh. I don't think we will ever know if the tax increases were "equal" or "across the board". But, this increase certainly leaves us open for future ones and I expect them sooner than later. What can one do? Nada.

[John Shrall]

24% increase for 2015 with a 110% increase over the last 2 years. Since 2011 taxes have increased 150%.

[bmh]

Obviously this is not going on accross the board or they would have a revolution..

[Hud]

bmh, another good point! About the only thing we can do here (IMHO) is just "bitch a little" and "let off a little steam". Sometimes this Forum allows us a means to do that and then we feel a little better. Ni modo.

[Hud]

We have a house in the state of Guanajuato. It is in my wife's name. Taxes have been exactly the same for 7 years, no increase at all. I was going to put it in my name, too, but I think we are better off with it in just her name. Get my drift?

[bmh]

Our taxes in Chiapas are low and nogoing up much either. The house is in my name but there are not may

foreigners there who own houses so it does not matter. I think I got kicked off the discount last year but really nothing to speak about.

I agree nothing to do about it so no point worrying about it one way or another.

[cbviajero]

Kinda reminds me of several years ago when we legalized a car in Nuevo Laredo. Another American was waiting outside with us for his paperwork and had been there also the afternoon before. My wife (Mexican) went inside to check on "her paperwork" and overheard the guys working in the office say " let the Gringo wait longer. He will eventually get tired and be willing to pay more to get his papers faster". They know all our "quirks".

I don't think that gringos are singled out for special treatment on the whole,they might be gouged a little more than Mexicans due to their inability to communicate in Spanish which makes it harder to argue or bargain with whatever official they're dealing with,it could be their ability to pay,it could also in some cases be their attitude and lack of understanding of the culture.

Bottom line,Mexicans have been getting screwed by their governments since pre-conquest days.

But by all means feel free to complain if you feel that you're getting special treatment.

[cbviajero]

We have a house in the state of Guanajuato. It is in my wife's name. Taxes have been exactly the same for 7 years, no increase at all. I was going to put it in my name, too, but I think we are better off with it in just her name. Get my drift?

We've had a house in Guadalajara for 8 years,it's in my name,when I got my first predial bill in the mail I saw that they had given me the 50 percent seniors discount,I hadn't asked for it,I was 47 years old at the time,the discount continued until last year when they started billing me the regulate rate,I didn't argue with them.

[bmh]

Well at least you got your discount for 8 years...no point arguing that one. I hope that now you are paying they are fixing all the all important potholes in your neighborhood!

[cbviajero]

Well at least you got your discount for 8 years...no point arguing that one. I hope that now you are paying they are fixing all the all important potholes in your neighborhood!

Now that they're charging me the full rate I am hoping to see some improvements.

[HarryB]

I'm tired of pointing it out. The Chapala gov. isn't doing ANYTHING for us or any other of the villages and all is quiet. Why not squeeze a little more?

The new formula is directed at homes assessed above 40K dollars. That keeps the local voters happy and they now know the foreigners are all too placid to make any noise. Wait until next year - what is the limit? How high can you raise costs and give absolutely no return?

How long before the pigs begin to squeal - no offense intended to the intellect of pigs, sorry.

How many of you are good little pigs and have already run down to pay your taxes/water when the discount is good to the end of february?

[Ginger]

I'm paying them tomorrow.

[bmh]

What are the wealthy Mexicans doing about it? I would like to know that, I do not hear them squeal either.

[HarryB]

they're waiting for their chance to take over and empty the piggy bank

[lcscats]

Lets stop and look at this. Chapala spends more money than it makes. This administration is trying to change the past policies of massive debt left to the next administration. These are facts. I can't tell you who is being uber taxed or whether gringoes are victims of selected targeted policies but lets admit what was happening in the past could not continue. Maybe this is all smoke and mirrors and the same crap is going on again. I don't know but I do know it appears some changes are occurring. We don't have money it seems but did they ever have real money or was it borrowed adding to the debt?

Something has to change to balance the budget. Increase taxes or decrease expenses right? Fire folks which they have done right? So they increase taxes not sure it is fair if it just hits us but something has to change.

Civil discussion folks about this please.

[HarryB]

They increase taxes, increase the debt (millions of pesos), cut services to nothing, delay federally funded projects for months with the money in hand and there is no change. Where is the money going?

[Mainecoons]

How many times did Ajijic residents have to go to Chapala to demonstrate against Raves prior to this administraion?

None. Adding insult to injury, Chapala permitted a second Rave on the east side after promising no more. Maybe not a big deal unless you were directly affected by the noise and litter but very representative of the problem with this particular administration.

If you read the GDL Reporter article, the reason stated for not funneling the property tax revenues through the state (about half of the municipalities opted out) was that this one has a relatively rich tax base. So we know the money is there. Before all these tax hikes, the streets got fixed and the trash got picked up. Not now.

As Harry says, where is the money going? I go out riding with my buddies through communities all over Jalisco and Michoacan. A lot of them seem to have municipal facilities in much better repair and are much cleaner than Ajijic since the last election.

Where is the money going?

[AlanMexicali]

How many times did Ajijic residents have to go to Chapala to demonstrate against Raves prior to this administraion?

None. Adding insult to injury, Chapala permitted a second Rave on the east side after promising no more. Maybe not a big deal unless you were directly affected by the noise and litter but very representative of the problem with this particular administration.

If you read the GDL Reporter article, the reason stated for not funneling the property tax revenues through the state (about half of the municipalities opted out) was that this one has a relatively rich tax base. So we know the money is there. Before all these tax hikes, the streets got fixed and the trash got picked up. Not now.

As Harry says, where is the money going? I go out riding with my buddies through communities all over Jalisco and Michoacan. A lot of them seem to have municipal facilities in much better repair and are much cleaner than Ajijic since the last election.

Where is the money going?

http://www.verum.mx/resources/pdfs/ComPrensa_0021.pdf

Google Translation:

"Page 1

COMUNICADO DE PRESS:

www.verum.mx

contacto@verum.mx

Verum assigns rating of 'BBB- / M' to the Municipality of Chapala, Jalisco

Monterrey, Nuevo León (26 December 2013): Verum assigned long-term rating of 'BBB- / M' with

perspective 'Stable' the town of Chapala, Jalisco. The rating considers an income structure

characterized by a high proportion of own income that is above the national average,

economic and social welfare of its population at good levels indicators, and efforts

positive administrative measures aimed at reducing current spending and increase revenue. Otherwise

, the rating considers its high levels of debt in proportion to their income and

limited financial flexibility resulting from an increasing current expenditure which has resulted in balances

primary deficit and a reduction in the liquid composition.

The structure of income from Chapala is characterized by having a high proportion of

own income. At the end of 2012, the ratio of own revenues to total revenues stood at 46.5% and

except 2010, this has remained above 35% over the past five years. The

municipality had total revenues of Ps $ 182.9 million during 2012 which represented an increase of 17%

compared to the previous year, while ordinary income tax (IFOs) totaled Ps $ 169.4

million, an increase of 28%, highlighting the alienation of immovable property during the

period. 2013 is expected to follow a favorable trend in the share of income that would continue

in 2014, mainly from own revenues, driven by various initiatives to

increase revenue and make it more efficient. Within these actions, the most significant is the

updating of land, with which management estimates that property tax revenues

increase about 30% in 2014.

When it comes to current expenditure, it has shown an increasing trend from 2010 to date, with an

particularly high increase of 13.6% in 2011, accounting for 96.1% of total revenues

in that period while operating expenditure was 102.2% of these. While in 2012 the

current spending continued to show a slight increase (1.8%), an increase in total revenues generated

an improvement in these indicators (IFOs current expenditure to 76.2% Operating Expenses to IFOs 81.3%). New administration took part in October 2012 and identified cost control as one of the

basic needs for the municipality could maintain a positive balance in position

financial, implementing an austerity program.

The main initiative of this program of austerity and will have greater impact on expenditure is the

downsizing, since the area of personal services is the greatest weight on the

composition of current expenditure (between 55% - 60% of current expenditure). For 2013 we do not expect

decrease in operating expenses, mainly due to additional expenses arising from the

liquidation of all these employees. However, we consider these actions as positive

forward these should bring benefits to the cost structure of the municipality, and keep

reasonable levels (70% -80% of OFR) would improve the financial flexibility of the entity.

The municipality primary deficit balances recorded from 2008 to 2011, as a result of high costs

operational and investment. Except for 2011, where the primary deficit increased so

important to Ps $ -41.7 million (mainly caused by the strong increase in investment in work

public), these deficits have remained at manageable levels. In 2012 a major adjustment was

downward in investment, resulting in a positive primary balance of Ps $ 15.1 million (8.3% of

total) income. By 2013 we expect the municipality to show a slight deficit in the primary balance,

because of the renovation project seawall [malecón] which represent an investment spending Ps $ 59

million, of which Ps 38 shall apply in 2013 and Ps $ 21 in 2014.

Page 2

COMUNICADO DE PRESS:

www.verum.mx

contacto@verum.mx

Direct debt Chapala has a balance at the end of July 2013 Ps $ 80.4 million, equivalent to

0.49 times the IFOs. The debt is comprised of three loans with the development bank (Banobras) by

together totaling Ps $ 20.4 million lifetimes ranging from 3-5 years. Additionally the

municipality has Bansi bank financing in the amount of Ps $ 60 million maturing in

2025, which has an Irrevocable Guarantee Trust in which 40% of those are affected

federal participation.

The current administration is working on refinancing its debt with commercial banks with

order to reduce the financial cost and improve its maturity profile. This what they like

by 2 credits; the first, in the amount of Ps $ 60 million is for the refinancing of credit

the same amount that has to Bansi. The second loan is for an amount of Ps $ 20 million for

for investment in public works, which primarily will be used for the renovation project

boardwalk. The arrangement of these credits should be given in December 2013, so that the municipality

it would be closing the year with a proforma debt of approximately Ps $ 99.1 million, which

represent 0.57 times the estimated budget IFOs 2013. The municipality does not have debt

short-term debt or supply chains, which we consider as positive. Moreover, the

liquidity position of the municipality is adjusted to maintain their levels of cash or very availabilities low.

On pensions and retirement, Pension Institute Jalisco (PEGI) is the

body responsible for the expenses for this concept, where the town takes its

monthly contributions. On the health side, the municipality has a medical clinic where

provides medical services to their employees, so this spending is registered in the

financial statements. Water supply and drainage of the municipality is in charge of the System

Municipal Water and Sewer (SIMAPA) Chapala, decentralized body of the municipality.

The municipality acts as joint obligor of a loan for Ps $ 10 million loan from Banobras to

SIMAPA. We believe that this could represent a financing contingency in the future, as the

agency has submitted deficit results in recent years and could even require support

I financier.

The rating outlook is 'Stable'. The rating could be increased to the extent that

observed positive results of initiatives aimed at reducing current expenditure and

increase in tax collection, which generate more stable financial indicators. By

Otherwise the ratings could be modified downward if debt levels increase

beyond what is expected by Verum, or if it is not possible to reverse the upward trend of current expenditure.

The town of Chapala is located in the State of Jalisco (125 municipalities) and is part of the region

administrative Cienega. This is located on the north shore of Lake Chapala, by which

named. Given its proximity to Lake Chapala, the municipality has a tourist vocation,

serving both domestic and international tourism. According to data from the last Census

Population and Housing conducted by the National Institute of Statistics and Geography (INEGI) in 2010, its

total population of 48.839 inhabitants and this has a very low degree of marginalization as

information from the National Population Council."

[Mainecoons]

That's an interesting read, appears to be from the end of 2012. Thank you Alan!

It shows major increases in property and income tax receipts.

Not sure what a "low degree of marginalization" is unless it is a measure of poverty. If so it along with the rapidly increasing revenue figures shows that this municipality is much better off than most. But you'd never know it to look at the potholed streets and the trash everywhere but in Chapala.

I think your figures simply confirm there is something seriously wrong here, more so than previously.

[Xena]

I live in a barrio at the north end of Chapala. We do not have potholes in our streets. At any given time, I come across pothole repair being done by people who live on that street, usually one of the older residents. It can take several days (seeming to depend on the age and physical limitations of the volunteer worker). So, at least in my barrio, Mainecoons need not feel envious of our superior municipal services.

[AlanMexicali]

They have a lot of debt to pay and marginalization is a measure of poverty in the área serviced by that particular municipality. Seems they got state approval to raise the taxes a good percentage lately because of its location as a tourist economy.