Tuesday, October 16, 2007

City Officials Develop Plan To Fight Urban Blight

This is a great example why Luke Ravenstahl should not be in charge of the city. For me, this becomes a policy problem.
kdka.com - City Officials Develop Plan To Fight Urban Blight "And I can tell you that the No. 1 issue when it comes to neighborhoods and quality of life is abandoned properties, is abandoned lots, is the neglect from those property owners to take care of them," Ravenstahl said.
To pile onto their train of thought, the #1 person in the mayor's office concerning neighborhoods came to a community meeting last week. She said that the city's #1 asset was its property.

These guys and gals are brainwashing themselves to think about lots, property, blight, buildings and real estate. In feudal days there were land lords and renters. They've got feudal perspectives.

Notice too how he is going to declare war on building. There are 1,400 condemned buildings and the budget gets to be doubled. They want to talk about apples and oranges. Money to building totals paints a bleek picture.

Double the demolishing still means less than half of the buildings get touched.

Presently, more buildings are flipping to racoon hotels than are being torn down. The city is going under farther each week.

After the city doubles its efforts this year, it will need to double its efforts again next year. Then there might be light at the end of the tunnel.

The comprehensive plan the city needs is rooted in the land value tax.

Today, property owners are rewarded with lower taxes when their buildings decline. Today, property owners are punished with higher taxes when their buildings are fixed up.

As taxes are set only upon the value of the land, there will be a city-wide push to retain value in the existing buildings. Or, if they are bad, but in poorer neighborhodds, they'll be fixed up for the value. And, the buildings that have gone to seed in more upscale neighborhoods will get fixed too, as the taxes will be too high to hold onto an under performing property.

The land tax is a win-win-win-win for owners, neighborhoods, city and taxpayers.

1 comment:

Joshua Vincent said...

While Pittsburgh burns, a trip down Route 51 shows Clairton fiddling a happy tune:

We've always wanted the shift from land to buildings to be the first in a series of shifts off labor and capital. We've always been particularly concerned about the nuisance taxes on business and taxes on physical existence (the per capita tax). Pennsylvania's Act 511 taxes were a pre-automobile relic of the Great Depression, cost a lot to administer, and produced revenue streams that long ago stopped justifying their existence.

In 1996, Allentown froze their Act 511 taxes when land value tax was implemented, but never repealed them. Now, one place has taken a bold step to save money, make their tax collection more efficient, all by using land values as the revenue source.

When Clairton School District our foundation to report on the feasibility of harmonizing their tax structure with the city, we reminded them that other taxes were just as worthy of reduction as the property tax. The board and school district officials saw the point, but considering the precarious state of fiscal affairs in that city, they passed on that option.

Now, the revenues have - in less than two years - stabilized to the point that they can move from reforming property tax to other taxes. We are glad to report this victory.
Clairton: 103 mills on land, 4.32 mills on buildings, instead of 29.5 mills on both.

From the Pittsburgh Post-Gazette of 10/15/2007:

Clairton City

The school district's repeal of a 75-year-old per capita tax last week will mean each resident will save $5.

School officials say the district's $13.4 million budget can absorb the loss of the tax as a revenue source.

According to district business manager Bill Boucher, the tax should have netted the district about $14,000 annually but instead it was receiving only half of that -- $7,000. Efforts to recover the outstanding taxes were unsuccessful and were costing the district about $2,000 annually.

Mr. Boucher said that left the district recovering $5,000 from the tax per year, an amount school administrators didn't think was worth the effort trying to collect.

"Our finances are such that we are able to eliminate a nuisance tax," Mr. Boucher said.

Even with the per capita tax eliminated, the district has an unusual taxation system, taxing property owners on the value of their land and on the value of the buildings on that land separately. Most districts tax residents on the values of their land and buildings together.

Clairton officials say their district is one of only three in the state to tax land and buildings separately, and they have no plans to switch from that system.

Joshua Vincent
Executive Director
Henry George Foundation USA/Center for the Study of Economics
1518 Walnut Street, Suite 604
Philadelphia, PA 19102