Monday, November 09, 2009

Mayor said he wanted to hear from those with better ideas and real solutions -- so I sent him this email

Hi Mayor,

In the budget address you said you'd want to hear from people with solutions and you'd work with them. Well, I've got it solved for you.

The land value tax is much more fair than the tax on the college students.

We need to start by selling parking garages, not leasing them. You want a one time fix. So a lease is not that. Leases, by design, comes up again later in the future.

Next, sell the stadiums, sell the convention center, sell the civic arena and even sell the new Consol building. Get out of the business of building for some and not for others.

Next, enact a land expansion moratorium on all nonprofit land grabs. And, then we'll ask them to shrink by 5% over 5 years and 10% over 7.

Next, we'll get into a land value tax solution, again, for the city. This will spike development in vacant land, especially in downtown and other areas where there should be density in our urban fabric. The land tax is easy to administer -- and it is the most fair of all.

A land tax rewards those in neighborhoods that fix up their properties. If you invest in your home -- you should not see your taxes go up. That is a penalty that the city does -- and it is all wrong. Rather, we should charge those that let the property decay -- but we do the opposite. if your house is falling, you get a tax break. The city is rewarding the exact opposite of what it desires.

Let's set up an appointment so we can talk in person next week. And, we'll talk too about summer in the city with parks and how to grow our city with families and care of our kids.


Bram Reichbaum said...

Great if we find a willing buyer, but who would purchase the stadiums, convention center and civic arena? I believe the stadiums and the center would require somebody to take on the massive debt still outstanding. I honestly doubt you could sell all four of those buildings together for US$1.

Plus in regards to the stadiums, there are surely long-term contracts in effect. And we must honor contracts. After those expire (if ever) we could try to sell the stadiums to the teams -- but only if we threaten to evict them otherwise. Which would be an empty threat, because what would we do with three empty stadiums and several hundred thousand angry sportsfan voters.

It doesn't seem like a practical idea, and it surely detracts credibility form the rest of your input.

Mark Rauterkus said...

Of course the teams that play in the buildings should buy the buildings. Jerry Jones didn't have the city of Dallas build his new stadium. We go the teams over the hump. Now it is time for them -- a for profit -- to step up.

I had hoped that the owner of the slots license would have purchased the convention center. Well, let's sell the owner of the table game the convention center -- with the table games license. We can make it a two-for-one deal.

Long term contracts are in effect. But, they can be adjusted by willing parties. That's the heavy lifting that needs to come from the mayor's office.

No threats to the teams. Just good diplomacy.

But, we've got threats to book readers and the libraries.

We have threats to college students.

We have threats to those who are sick -- sick tax.

And even Columbus is getting a new set of threats from its NHL team (blue jackets) as presented via the Chamber of Commerce.

Empty stadiums could be for our high school teams -- right? Hey, why in the world is the city football championship game NOT being played at Heinz Field this week? WTF. They are at Cupples on Friday.

There are not several hundred thousand angry voters in the city. Luke won will less than 30,000 votes. Few in the city go to the stadiums -- out of the mega majority of Steeler Nation (naturally).

This isn't a worry for the fans. It is a worry for the deed holders -- the authority weenies.

What is not practicle is building sports stadiums when you can't pay your bills. And, new upgrades are still happening to this landscape.

Luke needs 1x fix. The debt avoidance alone is worthy.

What isn't practical is selling the water pipes beneath the city streets. Who wants to own them. That was already done. My ideas are far more practical than what they've already done to get us to this mess.

And, the PNC Park lease -- have you seen it. It is a casebook of NOT being practicle. They play there. They use it. They can own it now.

n'at said...

Oddly, the same argument you employ today for the land tax was also used to justify it's passage 80 - 90 years ago. What's changed since it was repealed not too long ago - surface parking lots?

Selling off the stadia is a good start, but I believe the only winner would be the football stadium. The other teams would most likely require restructuring with a significant potential of bankruptcy in the out years.

Don't forget that the cultural trust receives more visitors than all of the sporting events combined, but still requires significant government subsidies to remain operational.

I would add dissolution of the URA and selling off all their assets, but the revenue would most likely return in small increments due to disparate property ownership. No one developer would want to purchase all the properties on a lump sum if they're scattered all over the city...

Mark Rauterkus said...

Yep to the URA. And, selling off those assets would take a long while, otherwise, the value of everyone's property will decline sharply.

That talk wigs out lots of folks, so I left it for you to mention. Nods from me.

What changed since it was repealed is a long list. More specific? Serious Q?

n'at said...

... was half-joking, but I still cannot wrap my head around why the taxes weren't reduced or restructured at the time? I'm a little embarrassed by still not having the ability to step back and process the entropy in local government of the 90s that made gross changes in their delivery of services, but not in funding.

Political expediency doesn't cover it all..

Mark Rauterkus said...

"Heavy lifting" would be required to reduce taxes or to re-structure government / city services.

They are light on "political will" -- as they read from the book of Onorato.

Furthermore, they are light on the capacity to perform those monumental tasks.

And, they realize it. So, at least that is good news. And, this 'hint' from the mayor that "I want to hear from you if you have a better idea" is just lip-service. But it shows how he does toss up his hands while saying this is the best we got.

Anonymous said...

Bill Peduto wrote in an email newsletter:

Missing the Mark - Taxing Students

Last week, Mayor Ravenstahl announced his 2010 Budget. The news centered on his plan to create a new tax to require all college/trade school/ theology (?) students to pay 1% of their gross tuition to the city. There are some serious problems to this idea. First, it is illegal. Pennsylvania municipalities do not have the authority to create new taxes - only the state legislature can approve such actions.

Second, it misses the mark. If the problem - throughout Pennsylvania, not just Pittsburgh - is that a limited number of older, host municipalities have a limited tax base because of lost revenue from hosting non-profits, then how is that solved by targeting students? The answer is - it's not.

Third, it sends the wrong message to those we are trying to lure/keep here to build a New Pittsburgh. There is something fundamentally wrong with a city that closes its libraries and taxes its students - it is a city that sells its future to pay-off its problems, not solve them. Fourth, it is a tax on a classification of people. Not only are we targeting people who are working to better their life (an anti-sin tax?) but we are setting a precedent of taxing people based on their classification.

Fifth, it is just a really bad idea - you might as well take all of the good will we received during the G20 and flush it down the drain. Last week, I requested that the ICA (The Oversight Board) meet immediately to approve or deny this budget. The agreement the city signed with the Oversight Board required them to approve a budget BEFORE it is presented to Council. There is no provision for "conditional-approval." These are the very same mistakes we made in 2003 - the same actions that created our budget mess. I have been working hard to find a better way to balance our budget and should have an announcement later this week.