SB 105-11: TMTH Act (Passed)

[Joseph Cao]

Do we want to set a fixed cap or index it to housing prices?

indexing it would probably lead to some confusion because if prices are high, someone maxes out the account, then prices suddenly drop, what exactly happens to the money above the new cap?

I think it's better to have a fixed cap and potentially increase it periodically in the future if prices rise accordingly.

Since this was brought over from the regional bill, who is setting the price caps here?

It seems to me that increasing prices manually also has the same potential for people getting caught on the wrong side of the price change, but the assumption I'm working with in both cases is that the excess amount is blocked off from use until external conditions change (prices return to their original levels, space is freed up in the account, and so on).

[Joseph Cao]

We also need to keep in mind that, even without accounting for market fluctuations, obviously the tax incentive is going to give people more buying power in cities with lower costs of living, like Oklahoma City, than high-COL cities like New York or Los Angeles. So a county-by-county index might be something to consider as well. That $3K or $6K is going to help everyone regardless, but once we start getting into the more expensive places (which are mostly the ones that have more job opportunities and therefore draw more people in) the benefits have a progressively smaller impact.

If we have run into problems codifying this all into the bill, then I think that a fixed rate of $10,000 for individuals and $20,000 for couples would be a fair route. Or perhaps something like $12,500 for individuals and $25,000 for couples.

How would we go about a county-by-county index? I originally thought maybe having just a simple function that scales the COL and potential benefits but that could lead to a similar situation as before where the COL decreases and may lock people out of benefits they thought they had.

I get what you're saying and I agree, it's just hard to find a way to make this work near-perfectly.

Yeah, the problem is likely that we would need to hand those decisions to the bureaucracy, because obviously we can't set a fixed rate for every county in the nation.

But that would also lead to budget problems.

Sometimes you just have to say a certain level of complexity is beyond the practical realities of the game and just take some things for granted.

So with this in mind, would the author prefer a fixed rate for all counties or should we leave those decisions to the 'Deep State'?

Hasn't the "Deep State"'s involvement in handling the difficult calculations in the past been basically a handwave by us here in Congress to punt the calculations to them and hope they're better at it than us? It seems better (and more transparent, and easier to identify and fix problems if they arise) to have a fixed rate.

I'm sure Scott's figures are in the rough ballpark we need but checking to see if they actually do the trick would also be a good idea.

[Joseph Cao]

Seconding the motion.

[Joseph Cao]

Aye.