Monday, March 29, 2010
Government The Tax-Base Problem
Posted by Mary Cashiola on Mon, Mar 29, 2010 at 11:18 AM
In a nut shell ...
In Mayor A C Wharton's City of Choice presentation last week, he presented two population maps. The first was population distribution in 1960, and each dot represents 300 people. (This map was actually created for a Memphis Flyer story on I-269 and the cost of urban sprawl.)
"You can see it's clustered in the core city," Wharton said. "Service delivery wasn't that difficult."
The second was population distribution in 2000.
"Keep in mind, revenue has peaked. The population has dropped but look where they are," Wharton said. "This is what's really straining us."
I'll be writing more about this in my weekly column for Wednesday.
In the meantime, here's something to consider: The police department accounts for almost 40 percent of the city's operating budget, while fire services are just above a quarter of the budget. That leaves 35 percent of the budget for everything else.
Comments (9)
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His he trying to say we need lower taxes because people are fleeing the city or more taxes because they are fleeing?
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It's costing more to provide services b/c the people are more spread out, but the amount of revenue to pay for those services is dropping.
People flee for one reason or another and the city annexes right behind them. Seems to me that if the city limits(not clearly shown on the map) that existed in 1960 were still the boundaries for the City of Memphis today....well, that's just crazy talk. It'd make too much sense to maintain what you have instead of incorporating former suburban outlays into the city fold. Those new, big(read: more highly appraised) tracts of homes were just too tantalizing I suppose.
Now the city is left with more area and fewer taxpayers actually paying their taxes. Meanwhile, those of us still here are left to pick up an ever-increasing burden. Maybe this de-annexation talk isn't so far fetched after all. Slough off some of these outlying areas and get back to a more manageable footprint.
There are number of things that contribute to the city's tax base woes beyond people leaving, though I believe Memphis's population has stayed relatively constant despite popular opinion. Let's look at whether businesses are stepping up and paying their taxes or even better Wharton has the realization that property taxes alone is no way to live.
As the population went down, the number of city employees actually went up. Where's the math?
Per the de-annexation comment. I agree that it is an enticing idea, but it would probably face some major court action depending on how it is accomplished. If the city were to go about the task, what incentive would it have to keep the most downtrodden neighborhoods within its boundaries? Why hang onto South Memphis or New Chicago if they are not paying their way? Would it be legal to de-annex them because their property values were not high enough? What happens to the areas that are de-annexed to ensure they continue to receive services? Down grading police and fire services to the level the county provides would not exactly speed a recovery for those neighborhoods.
I am definitely in favor of de-annexation. It would be nice to have fixed, natural boundries (which isn't always possible). The areas that are de-annexed would have the chance to incorporate as they see fit.
Urbanut, I'm not 100% sure on the laws concerning annexation boundaries but from what I gather, the city has to maintain a continuous boundary. Also, I don't think any one area can close in around another, leaving it as an unincorporated island. As an example, if Memphis wanted Downtown and areas like Midtown/Raleigh/East Memphis they'd have to take the neighborhoods in between as well.
You've also got political/social issues as well. Why would a long-standing local politician allow his/her voting base to be yanked out from under them due to unincorporation? That's not as big a deal out east as it is in the "inner city" whatever that means anymore. The R-word will play a huge factor in all of this if it were to ever come to fruition and will help insure a socio-economic "balance" whether the City's usual suspects intend that or not.
De-annexation would make it easier to lop off areas more recently annexed on the east side of the county though. Memphis would have to deal with the subsequent loss of tax revenue but they'd also be reducing the service footprint with everything from trash pickup to schools. The de-annexed areas would return to county services as they had before(which isn't nearly as bad as one might think, from personal business experience) and could choose to remain unincorporated or incorporate and form their own town or city as Mad_Merc stated above.
We got problems.
But none that a little density and larger tax base wouldn't solve.
Um...yeaha...We got problems.
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