We hope you were able to watch the unprecedented statewide interactive forum with Economic Development czar Dan Gundersen that we posted an alert about. The show, aired on PBS stations was called “Upstate: Getting Down to Business.”
It was an incredibly informative discussion of the challenges and opportunities present throughout upstate communities and it resonated with several local issues we’ve been discussing here. You may remember when we first discussed Governor Spitzer’s appointment of Gundersen as the point person for upstate economic development (read it here). Well, he has gotten right to work developing ‘targeted economic development plans’ for several communities, from Buffalo to Rochester to Syracuse to Binghamton. While the show discussed these a bit, the majority of time was spent focusing on the shared concerns of municipalities struggling to retain existing businesses, attract new businesses and residents and generally revive their economies.
Gundersen and his Acting Regional Director, Kevin Hurley, outlined three “barriers to development” that need to be the focus of local, state, and federal economic development efforts. The three are:
- High Taxes. As Peter Alan Weinman stated, in his opening comments to Gundersen on behalf of the City of Buffalo, “property taxes are growing at an alarming pace” and Buffalo has one of the highest rates in Western NY (you can compare their rate of $37.41/ $1000 assessed value to our rate by clicking here). Gundersen spoke frequently of the Commission on Local Government Efficiency as an agency that is examining this issue in close detail. You can visit the Commission here and see how ideas like shared services (that we discuss in relation to Geneva here) and parity in compensation (that we discuss in relation to sewer services here) are key to alleviating the tax burden that scares away businesses and residents.
- A Lack of Young Professionals. Maybe you’ve heard it referred to as the “brain drain” but that might not exactly capture it. Recent college graduates and other young professionals are not only looking for employment opportunities, but for a certain community or social dynamic. Better collaboration between area employers, colleges, and government leaders might enhance those offerings in Geneva. For our take on attracting young families to the area, see “Rethinking City Living."
- Dwindling Downtowns. It’s not just young professionals, but many potential new residents that are looking for vibrant downtowns. The work-downstairs, live-upstairs model is once again gaining ground and communities that want to revitalize need to focus on repopulating their downtown areas with shops, restaurants, and cultural offerings and housing for the people who can frequent these establishments. This is the focus of the recent RESTORE NY application submitted by the city.
2 comments:
As a property owner I am not supposed to say property taxes are not an issue. The truth is that owning commercial property in several municipalities gives one a different perspective. The main thing I look for in a municipality is good services. If these services are incredibly inefficiently run costs will be higher, but lack of efficiency is usually insignificant. Every landowner should be treated the same, rules should be spelled out and fairly enforced, and issues should be openly debated. (The open debate is the most difficult for many people.)
Tax rates are important, but not nearly as important as the overall tax paid. The Assessed value is the most important issue. If we assume that the assessments are fair then it is the market value of the property that controls the tax. If one could take a building from down town Geneva and put it in midtown Manhattan it would be worth about 20 times what you would pay in Geneva. This means that the same building would pay more in taxes in New York City even if the tax rate were 5% of Geneva’s.
If you want to reduce tax rates increase property values. Geneva is a beautiful city; I would think property values could easily double. If you want to reduce the property tax levy you should encourage retail development. Sales tax increases could substitute for a significant portion of property tax. The type of development plays a large roll in the tax burden. Residential development has been shown to have a greater service demand than is paid for by taxes. Residential density is necessary for certain services to be financially feasible, but will always result in a greater tax burden.
Mark, You raise some excellent points here. Firm and fair code enforcement and consistent, quality services are very important to this city. We believe we have achieved those objectives.
We are a bit confused by your statements about taxes. Specifically, you say that assessed value is the most important issue, and that the tax rate is not as important as the total tax bill. To a point we agree, because the tax bill is a function of the rate multiplied by the assessment. But then you go on to compare Geneva's taxes with midtown Manhattan's in a way that suggested Genevans are getting a deal. Perhaps we are misreading your point, but we strongly disagree.
The relevant difference (that you seem to accept) is the property values in each location. So while a tax bill in Manhattan is likely more than one in Geneva, the bill as a proportion of the total property value is much lower in Manhattan. It's a question of value.
Now, why does this matter so much to us? Well, we think you and other business/property investors probably know best what goes into your decision to invest in a community. If you can go to surrounding communities and get 'better value' for your dollar, then you'll likely do that. We want Geneva to be a place that people see as a sound investment decision, not a speculative risk!
So, we agree with you that the city needs to diversify revenue sources, and some effort has been made in that vein, but more can be done. The key is convincing the powers that be that it is important to do so. Given their attitude towards taxes, we don't have a lot of confidence that the council majority, even with the addition of some new faces to the mix, really understands the financial realities of the City in which we all live.
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