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Government microcharges closing budget gaps, but what's next, sidewalk tolls?

By David Kocieniewski

New York Times News Service

Published: Sunday, Aug. 30 2009 12:00 a.m. MDT

NEW YORK — Kelsey Graham and his wife were on their way to Lincoln Center in Manhattan when they decided that ?la carte government had gone too far.

For years, the Grahams had driven from their home in Nyack, N.Y., availed themselves of the free weekend parking at the Tarrytown train station, then taken the train into Manhattan. But this spring, the village of Tarrytown began charging nonresidents $8 to park on Yankee Stadium game days — a fee that startled, and infuriated, the Grahams.

"It's ridiculous — we're supposed to keep track of when the Yankees are playing?" said Kelsey Graham. "Every time you turn around, the government is charging you for something. It's just another way to nickel-and-dime people."

His lament is hardly unique. With the economy floundering and tax revenues falling, governments and public authorities have tried to patch holes in their tattered budgets by charging new or higher fees for a broad range of services — including taking a civil service exam and operating a nuclear power plant.

The purpose of the many microcharges is to help avoid, or at least limit, broader tax increases. But with escalating fees for things like tanning bed inspections, pistol permits and marriage certificates, daily life can start to seem like a labyrinth of public-sector panhandlers.

There are increased payments required from cradle (birth certificates) to grave (plots in municipal cemeteries); in the workplace (licenses for private investigators, lifeguards and tax preparers) and at leisure spots (entrances to parks and public golf courses).

Want to indulge? Better open your wallet: Higher fees for cigarette and alcohol retailers in New York are being passed on in the form of higher prices for smokers and drinkers.

Even animals are not immune: New York state established a $10 entrance fee this year for each horse running in a parimutuel race.

The National Conference of State Legislatures says similar increases are being imposed by local governments around the country.

While some economists believe the worst of the recession may now be over, most governments are bracing for more lean years. Elected officials nationwide have floated novel proposals: in Nevada, a tax on legal brothels; in California, a $50-per-ounce tax on medical marijuana. Florida lawmakers are now mulling a fee for each cow or pig slaughtered in the state, and Kentucky officials are considering imposing a surcharge for downloading a ring tone on a cell phone.

Officials say the fee increases are a fair way to raise revenue because they affect the actual users of a service rather than the public at large. But many budget watchdog groups argue that the fees are too often used as a crutch by politicians hoping to avoid making hard decisions about cutting spending.

"They're an easy out," said Charles M. Brecher, research director for the Citizens Budget Commission, a nonpartisan organization that analyzes municipal spending.

The town of Montclair, N.J., this year closed its budget gap through a mix of devices: trimming expenses, raising property taxes, and boosting fees on limousine and garage-sale permits as well as landscaping and arcade licenses.

In New York City, Mayor Michael R. Bloomberg was thwarted in his effort to institute congestion pricing and a 5-cent surcharge on plastic bags. But in addition to reducing the city work force and raising some taxes, his budget includes increased fees for water, sewer service, some garbage-carting permits and more.

Westchester County, N.Y., eliminated its $3 million annual subsidy to Playland Amusement Park in Rye by increasing prices: The entrance fee has gone from free to $3, and the rides, once pay-as-you-go, now require a day pass ($25 for county residents, $30 for outsiders).

Perhaps the biggest clash over what critics have taken to calling "fee-based government" has come in Connecticut. Gov. Jodi M. Rell, seeking to uphold her promise not to increase taxes, called in March for more than $100 million in additional fees, including increases for motor vehicle registration and for licenses for dozens of occupations, including hairdressing, accounting and working as a stable hand.

But the proposal prompted so many objections that Rell and Connecticut lawmakers have been unable to complete a budget; the state has been operating without one since July 1. The governor met with legislative leaders last week, and the two sides were said to be considering a mix of fee increases and tax increases.

Even those who praise Rell's efforts to avoid raising taxes are not surprised that the proposed fees caused a furor.

"There's really only so much that people can take," said Susan Kniep, president of the Federation of Connecticut Taxpayer Associations, which advocates steeper cuts in the public payroll to tame public budgets.

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