Community improvement strategies for keeping the property tax base up: Something school systems should think about? | Nesquehoning Pennsylvania

Hennepin Community Works.  I mention quite frequently that Hennepin County, Minnesota created a community improvement program for Minneapolis starting in the late 1980s, because they noticed that with population leakage due to suburban population outmigration, the city's housing stock was depreciating in value, affecting property tax valuations, and therefore property tax revenue.  

They realized that if this continued, it would pose severe economic problems for the county.

They also noticed that the housing that kept its value the best was proximate to high quality amenities such as parks, greenways, and lakes.  This lead them to focus on place-based investments.

Later, Minneapolis developed a couple of complementary programs, and later, the County added light rail transit to the program also.

-- "A County and Its Cities: the Impact of Hennepin Community Works"," Journal of Urban Affairs (2008)

Nesquehoning, Pennsylvania/Panther Valley School District.  The Washington Post has an article, "A closing factory, a booming economy and a town’s search for identity," on the closure of a firefighting truck plant in Nesquehoning, Pennsylvania.  

The company was founded in the late 1940s and was family owned, until the death of its founder.  A couple years ago, the company was sold to a private equity firm owning other firefighting equipment manufacturers, and the decision was made to consolidate KME's operations with other facilities, meaning that the plant in Nesquehoning will close in 2022.

The article says the labor market is decent in the area, so it won't matter so much.  But it doesn't discuss the wage rates at the KME plant, or at other employment alternatives in the region.

It mentions that the founder and the company had a strong philanthropic focus on the community, and the importance of the company to the city tax base.

But it also mentions even with the plant, that the community was experiencing disinvestment.  From the article:

The school district also depended on KME for its tax base. The impact of the factory’s closing was still being worked out. 

But the Panther Valley School District was already in trouble. Its six-year college graduation rate was under 12 percent. The district was severely underfunded, despite having the state’s 10th-highest property tax rate, officials said. Now, it was one of several districts suing the state over education funding. 

Even as Panther Valley saw property assessments increase in 2020, Walck said, the amount of property tax revenue going to the schools declined because so many other properties fell into blight. “It’s not a good situation,” Walck said.

This reminds me of the Hennepin County realization.  

Even in communities with relative success--for example, Nesquehoning is a lot better off than Flint ("The real lesson from Flint Michigan is about municipal finance," ) or Pontiac ("Pontiac Michigan: a lagging African American city in one of the nation's wealthiest counties," 2022), cities in Michigan that were once very successful as home to major automobile manufacturing factories, but as those plants shut down, the local economies were devastated--shouldn't they look at property tax assessments and revenues as indicators of community success, and develop programs similar to Hennepin County Works, as a way to ward off economic decline?

Typically, when people look at the property tax-school funding issue, it's more about how communities with lower tax bases underfund their schools by comparison to high tax base communities (The Property TaxSchool Funding Dilemma, Lincoln Land Institute).

But this element is subtly different.  

Oakland County, Michigan: city/township school districts versus county-wide school districts.  Interestingly, when I went to K-12 schools in Michigan, Oakland County then was (and still is) quite wealthy.  School districts are organized mostly by city or township, not the county as is typical in Virginia and Maryland, although some districts might span multiple communities.  

Many were quite wealthy, with many fully enrolled schools.  Although even then, the next door school district was starting to close schools on the edge of its boundaries (one of the schools happened to be close by, even though it wasn't our school district).  

Now, many of the cities that had multiple high schools with burgeoning enrollments have only one school, and many schools at all levels have closed and consolidated.

I wonder though how the tax base has been?  It's probably been reasonably stable, not hurting school district revenues, especially as they've responded to falling enrollments by closing schools.

One advantage of county-scale school districts is the ability to share revenue across a county.  

OTOH, standard models for what schools should look like ("Missing the most important point about closing Clifton School in Fairfax County,"2011; "The bilingual Key Elementary School in Arlington County as another example of the "upsidedownness" of community planning," 2019) means that they might not be making better decisions either.

Conclusion.  School boards in smaller communities these days seem to be more concerned about whether or not to wear masks ("The Topic Of Masks In Schools Is Polarizing Some Parents To The Point Of Violence," NPR), parent involvement ("As School Board Meetings Get Hostile, Some Members Are Calling It Quits," NPR), book banning ("Books are being banned from school libraries. Here's what that does to students," USA Today), and politicization more generally ("How One Governor’s Race Has Channeled National and Local Anger Over Schools," Education Week).

I wonder if they are capable of thinking more broadly about funding and how to invest in schools and communities in order to maintain and improve the property tax base, to protect funding streams?