Property Tax Burdens and Smart Growth By Christopher J. Smith I. - PDF document

Property Tax Burdens and Smart Growth By Christopher J. Smith I. Introduction the Connecticut AFL-CIO, as well as a vice government policies concerning the provision president of one of the state’s universities, two of federal guaranteed home mortgages, federal Over the past few years, Connecticut has municipal land use planners and a land use financed highway construction and municipal undertaken a number of legislative efforts to attorney, is charged with: 1) evaluating person- land use practices. These policies, coupled with address the serious adverse effects of urban al and business property tax burdens in this the lack of government funding to preserve our decay and suburban sprawl. These effects state compared to other states, and among this urban centers’ infrastructure, education system include the abandonment by business and indi- state’s municipalities; 2) considering modifica- and affordable housing opportunities, prompt- viduals of the core urban centers and inner-ring tions and alternatives to the current system of ed the flight of business and individuals from suburbs, increased commuter travel generating property taxation; and 3) evaluating incentives our cities into the surrounding suburban rings. 9 unprecedented traffic congestion, inequities in and disincentives for smart growth. The com- This flight of resources caused a loss in education and fair housing opportunities, gov- mission is to provide the legislature with a final property values, with attendant loss of tax rev- ernment inability to provide meaningful long- report on or before October 1, 2003. 7 enue, for the urban centers. Our cities found term/regional planning, a loss of rural land, and This article provides a primer on the issues themselves without a meaningful and adequate a tax system premised upon property taxes that associated with the commission’s legislative tax base. This problem is exacerbated by the is insufficient to address the needs required for charge. First, the article addresses problems lack of federal or state government fiscal the effective growth management and sustain- associated with the societal phenomenon of incentives to promote urban infill and redevel- ability of our communities. 1 urban decay and suburban sprawl. Second, an opment. Instead, much of the limited govern- Specifically, the General Assembly adopted overview of the state/municipal tax system ment funding is utilized to upgrade stressed legislation to promote the redevelopment of issue is provided. Third, potential land use suburban infrastructure. This, in turn, further brownfields, 2 create a transportation strategy mechanisms to enhance more effective growth encourages business and individuals to relocate board to address statewide transportation management are discussed. to the suburbs to the additional detriment of the issues, 3 create a blue ribbon commission to urban centers and inner-ring suburbs. 10 The end review Connecticut’s affordable housing land product is development and investment spiral- use appeals act initially created in 1989, 4 revise II. The Problem of Urban ing out from the urban centers into the suburbs, the process for municipal land use commis- Decay and Suburban Sprawl where neither the urban centers, nor surround- sions to produce plans of conservation and ing suburbs, have a sufficient tax base or infra- There are numerous articles, papers, studies, development consistent with the state plan, 5 and structure to provide a sustainable community reports and entire books written on the topics authorize municipalities to enter into agree- for their citizens. of urban decay and suburban sprawl. Indeed, a ments to share revenues generated from real From a development/investment standpoint, perusal of the voluminous material confirms and personal property taxes for the purpose of the lack of coordinated government infrastruc- that the issues are difficult, at best, to define in allocating resources for infrastructure improve- ture funding for roads, sewers and other utili- a sentence or two. To paraphrase U.S. Supreme ments to encourage more centralized develop- ties, and the sometimes less than “smart Court Associate Justice Powell attempting to ment on an intermunicipal basis. 6 growth” oriented municipal land use regulato- define pornography: Urban decay and subur- In the 2002 regular session, the legislature ry procedures utilized by Connecticut’s 169 ban sprawl are difficult to define, but one approved Special Act No. 02-13, “An Act municipalities, combine to provide limited knows them when one sees them. Concerning a Blue Ribbon Commission on options for residential, commercial and indus- However, the majority of experts agree that Property Tax Burdens and Smart Growth trial development in our communities. urban decay and suburban sprawl are interrelat- Incentives.” The seventeen-member commis- There have been studies and numerous com- ed ( e.g. , the problems associated with one are sion, comprised of mayors, selectpersons, town mentaries concluding that urban centers and often associated with the other). 8 The two prob- managers of urban and suburban municipali- their suburbs are complementary. 11 A recent lems result from the substantial growth of our ties, a representative from the Office of Policy econometric analysis performed at the Wharton human environment commencing after the and Management (OPM), the Connecticut School of the University of Pennsylvania found Second World War. This growth was fueled by Business and Industry Association (CBIA), and