Connecticut commentator considers land tax

by Dollars and Sense

In Repopulating New Orleans (D&S, Mar/Apr 2006) , Mason Gaffney set San Francisco's rebuilding after its 1907 earthquake and fire as a model for present-day New Orleans:

How did a city with so few assets raise funds to repair its broken infrastructure and rise from its ashes? It had only the local property tax, and much of this tax base was burned to the ground. The answer is that it taxed the ground itself, raising money while also kindling a new kind of fire under landowners to get on with it or get out of the way.

In the April 30 Hartford Courant, columnist Tom Condon saw in Gaffney's ideas a remedy for a more prosaic sort of disaster: Hartford's declining population of young adults. He noted, "Hartford buildings are taxed about three times more than the land on which they sit," with the result that:

Connecticut lost 132,000 people between the ages of 25 and 34, nearly 23 percent of the total, between 1990 and 2000, according to census figures. A major reason the young adults are looking at Connecticut in the rear view mirror is that they can't afford a house here.

The response of state developers to this need has been to build suburban McMansions and lots of over-55 "active adult" housing. In other words, we've been serving the people preparing to leave the workforce, not those who want to enter it.

This year, Connecticut's Generally Assembly has considered a bill that would have allowed cities with populations of 80,000 or more to tax land at a higher rate than buildings, but Condon reported that it seemed likely to fail. Which, he wrote,

is unfortunate. Cities should have the option to try the land tax. If nothing else, homeowners won't be penalized for fixing up their properties. The idea also promotes what ought to be a principal planning goal in the state—carefully increasing density in city and town centers and along transit corridors. This would encourage affordable housing, which in turn would help the economy.

Read the rest here: http://www.courant.com/news/opinion/commentary/hc-plccondon10430.artapr30,0,4561370.column

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5/11/2006 12:06:00 PM