Here goes. First you doadmit that the commercial base is leaving the city or worcester and costing residents on their annual taxes, right? Assuming you agree with that, my question is how do we reverse this trend? In other words, what is your plan?
Second, for some of your points. The final version of the Philly Plan are not done--obviously. The Citizens for business have targeted what are referred to as the Commercial Area Revitalization Districts in the City of Worcester:
- Canal District
- Downtown
- Lower Lincoln Street Corridor
- Main South
- Pleasant/Chandler Streets Corridor
- Shrewsbury/Arctic/Grafton Streets Corridor
- Southbridge Street/South Worcester Industrial Park (SWIP)
Our initial plans were to merely target new commercial projects or expansions on existing commercial projects, not residential projects. Now for some of your questions (I changed some of your words around):
1) So if I own an existing commercial property that is not in one of these districts, I basically end up subsidizing these new projects more then ordinary because I now pick up some of the taxes that the new construction are not paying?
Jahn. look no further then Demers Goodyear and Manoog Plumbing. These were two properties in a CARD district, let me ask you how much do they now pay in property taxes? Answer--nothing!!! Both were bought by churches. Maybe if we had a Philadelphia type plan, a commercial entity would have bought these properties and kept the properties on the tax rolls.
Do not understand how attracting commercial development in targeting areas that have none can possibly increase the taxes of other commercial, or for that matter residential property owners.
2) Do we know if there is a nexus between reduced taxes and new construction?
We don't. Once we pass this type of plan, we will track results to see if in fact there is.
Jahn, the Phliadelphia Plan that the Citizens for Business is merely attempting to attract commercial development in targeting areas to help increase our tax base that will help all the current tax-payers, both commercial and residential. Again , I leave you with, if you do not like this plan, what is your plan?
10 comments:
Jahn:
From someone who has taken a run down commercial property, sank a good chunk of change into in, created three new business and about 10 news jobs then to see my tax bill go from $2,500 to $6,500 in one year.
I am telling you a Philly plan in Worcester would help jump start alot of development knowing my tax bill would be frozen for 10 years.
Bill
Bill...u do realize you are arguing a Philly plan with a JAHN-kee, right? :-)
Go Phillies!!!
Harry T
Worcester,MA
Harry:
you mean I am arguing with myself..
Seriously, Jahn has some good points and the Philly plan is not perfect. What plan is?
We made big mistake going to a dual tax system but how do we undo this?? It will not be easy.
Jahn, tell us your plan.
Bill
Bill
some ballsy leadahs who are able to convince the citizenry that there will be some upfront pain but that it will create a more vibrant economically healthier city..all comes down to leadership mates..or as Senor Jahn likes to say..it's all about the people:>)
"Bill Randell said...
Harry:
you mean I am arguing with myself.."
Isn't that what some of the readers think? Bill = Jahn!
LOL!
Agreed, the comm tax base is leaving and as regards manufacturing has left and will probably not return any time soon (if ever), at least to the extent we had a manufacturing base in the past. Biotech is great but it will never produce the number or kind of manufacturing jobs Worcester had in days gone by.
Agreed, it is also costing residents in terms of increased residential taxes, but more importantly it is disproportionately costing the remaining comm. tax base even more. Witness the comm rate is twice the residential rate.
The Demers and Manoog site issues have more to do with tax exemption than with tax rates or tax dollars paid. Agreed, they do not add anything to the city coffers therefore increasing what others, both comm and residential must pay. However, the same could be said in the WPI, Clark University, Becker, Holy Cross, or Hahnemann Hospital areas where non profits have over the years taken many properties off the tax rolls.
The Jahn Plan:
a. Round up as many comm taxpayers as possible and get an item on the council agenda re: the comm tax rate.
b. Comm taxpayers show up in force at the council meeting(s) re: reducing the comm tax rate. This would be similar to what the cops, teachers, firemen, and/or retirees do when they have an item is before the council. ( Please no hockey sticks or basketballs or profanity)
c. If the council balks at your request, the comm. property owners would then have to run their own slate of candidates.
My problems with the Philadelphia plan:
a. You immediately create another nemesis, i.e. the existing comm tax payers.
b. We have no way of knowing if the tax reduction is the reason or a reason why new businesses opened or existing businesses expanded.
c. For all businesses, except real estate businesses, property taxes are a small line item. This in spite of the fact that some businesses will suck up to the local pols by saying they located in an area because property tax rates were low.
d. True entrepeneurs will move/expand when they perceive opportunity and a small reduction in property taxes is not really an opportunity. Is it good, yes...opportunity, no.
e. There is also a theoretical argument that all expenses are just passed on to customers.
f. We already have too many existing comm. properties that are vacant. Is there really a need for new construction or expansion in Worcester?
g. The Philadelphia Plan does nothing to address city expenses. Expenses are the elephant in the room.
If I was going to go with a Philadelphia Plan, I would not target seven different CARD areas. IMO it should be targeting one, two, maybe three areas at the most. Downtown would be my first choice. Maybe you're asking to target seven different areas and hoping to settle for maybe two three areas?
Jahn:
Although your idea is not a bad one, it will never happen.
Don't see how other commercial owners would be mad about trying to increase the commercial tax base? You are right, however, there are too many empty buildings. Buying one, locking in the assessed value for ten years and waiving permitting fees would encourage development.
Does the Philly address City expenses? No, it does not at agree. I also think there should be a "jahn" plan to address city expenses.
Bill
A Jahn plan to address expenses.......God You're asking me to be redundant AGAIN. Most regular visitors to this site know my ideas re city expenses. Maybe I'll draft one, one of these days.
Bill, to get a Philly Plan in place you have 3 gruoups to appease.....the council, the residents, & the existing comm. prop. owners. My plan has only two groups to beat back, the CC and residents. Philly is a direct snub to current comm. property owners who have been stepping up to the plate fro decades and paying their unfair share.
I thought Philly only applied to new constr and/or expansion. Are you saying it would apply to buyers of exisitng vacant comm. property, too?
I really think we have to put a stake right through the heart of this idea. It's a back door way to help out new comers. The council s/b confronted head on.......drop the comm. rate.
This whole thread raises another question for the long term...........is Worc's future really more of a bedroom commmunity vs. an urban center?
Jahn:
If the philly plan attracts newcomers to buy, in this example, an abandoned building in a targeted area. Please tell me how that it is a bad idea and who exactly would be mad?
Residential and Commerical property owners should be happy that we kept it on the tax rolls, it will create economic spin-off and in ten years it will be taxed at full value.
The whole point of the Philly Plan that Citizens for Business is so that we maintain and increase the commercial base in targeted areas which benefits all tax-payers.
The Councilors to date are in favor of looking into it and coming up with more specifics.
Bill
Bill, how can you say with any degree of certainity that the abandoned building in your example would not have been prchased anyway?
If it's truly abandoned the city will ultimately take it and auction it off realizing even more money w/o the need for a Philly Plan.
Your plan is just another redistribution of the total property tax levy from new comers to those who have paid their fair share all along. Penalize those who are already here.
The dual tax rate structure has to be stared down in council chambers and faced for what it is......a screwing of exisitng comm. property owners. Now you want to sock it to existing comm & residential property owners again with this back door plan for newcomers.
Plus with small retail which is mostly what we're going to get for newcomers, the failure rate is very, very, high in the first 5 years of business and we all too often end up giving the newcomers an upfront benefit only to see them not survive the long run.
If you're going to do this maybe you could sway me if we told the new comers we would escrow their discount and if they're still around 5 yrs from now give them 1/2 of it back and and if they're still around in 10 years give them back the remainder. I
I still suggest to you that a small discount on a new business property taxes is no where near enough of a persauder to entice newcomers.
Check me on this, but I think we've been giving Berkly a pass on ALL, THATS ALL of their property taxes which has amounted to mmillions ever since they "signed up" for City Sq. Now if City Sq doesnt make it...........we the exisitng traxpayers just got royally shafted b/c the city ponied up, upfront $$$$$$ for something didn't (assumming here) happen and do you think Berkley will ever pay it back, even if that are legally obligated?? Fat chance.
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