Municipal economic literacy

This is an email from the urbanists list by Sara Hines. It refers to an area of Massachusetts outside of the Boston region. I do not know what equivalent numbers would be in Washington, DC proper.

There are studies in this area of the property tax dollar collected to the cost of providing town services--based on building type. They only broke out single family, multi-family, commercial. The single-family cost was $1.20 in service cost per each $1 collected. Multi-family went down to $.90 which isn't much of a savings.

Most of the cost in this area was based on school costs as single family homes generate more school children at $10K/yr. ea. No McMansion with 3 school age kids is paying $30K a year in taxes. 70% of the taxes here go for education, and the 35% of households who have children want more. What this town dreads is a low-income rental unit with 4 kids. If there's no reporter in the room, they speak it.

[Note: a center city would have higher costs per household because of the greater number of persistent unemployed and the higher number of extremely lower income households. Plus, because of DC's unique status as a city-county-state, it collects and retains income tax revenue, which increases the value of each household in terms of its revenue generation capability.]

Many have argued that multi-family is a "cash cow" in this area because of that 10 cents. The commercial/retail use, on the otherhand, is only .45 in outgo. There are people here (about whom I have complained incessantly) who still think that big expensive single family is the way to go because of the taxes collected, but depending on what the taxes go for, they are usually the biggest tax drags. Non-profit uses can be just as big a problem as affordable housing in terms of taxes, yet being a college town is supposed to be a good thing.

As is another NU ideal, there needs to be an understanding of a economically reasonable mix of uses, from affordable to upscale, from residential to commercial and other uses. I've never heard a projected ideal mix of uses--how much residential, how much non-residential to make a community "sustainable", whatever that means. Again, looking at the jobs people have and where those jobs are located is a part of this as well. I live in a community that is 7% non-residential tax base, and I have suggested that if we could get closer to 20% non-residential taxes, the character of the town would begin to be different and that some of the financial pressures would be lessened.

We only believe that a mix of incomes and uses will be the answer. We never suggest what the mix should be. Super rich communities always do well, super poor communities always don't; where's the balance point?