Revitalizing America’s Smaller Legacy Cities: Tools for Local Leaders

Smaller legacy cities – older industrial communities with about 30,000 to 200,000 residents – are undergoing significant transformations as they adapt to twenty-first-century economic realities. Revitalizing America’s Smaller Legacy Cities, a report from Greater Ohio Policy Center and the Lincoln Institute of Land Policy, documents the unique challenges and opportunities facing these communities as they seek to revitalize and thrive. Eight strategies for small city urban revitalization emerged from that report, and this toolkit is meant to provide additional resources to practitioners working on the ground to implement them.

This webinar will prove useful for individuals in community organizations, local government, community lending, philanthropy or anyone else who is interested in urban revitalization in small legacy cities.

[nthperson]

If there is any key ingredient to revitalizing a community, that ingredient is the elimination of the taxation of houses and other buildings, instead collecting the full potential annual rental value of locations. What does this do? First, it rewards the care and maintenance of buildings, which are depreciating assets that require continuous expenditure on maintenance and every ten years or so huge expenditures on systems replacement and upgrading. Taxing buildings is counter-productive and, in the long run, a destructive practice. If there was any logic in taxing buildings, then local governments and school districts ought to tax all forms of depreciating assets (e.g., automobiles, computers, televisions, telephones, refrigerators, lawn mowers, etc. etc. etc.).

What about taxing locations at a location's potential rental value? The economic literature if filled with arguments favoring this means of raising revenue to pay for public goods and services. The rental value of a location exists because of the quality of public goods and services brought to the location, independent of what the owner does or does not do to improve the site with a building. Taxing location rent gives the owner of the location a strong financial incentive to improve the location to its highest, best use. Failure to collect the potential rent has in most communities made holding land idle a profitable form of speculation. When the annual tax on land is low, owners can hold land vacant for years or decades. Vacant land provides no housing for anyone or a business location or other constructive use. If there are many vacant lots in a neighborhood or many vacant and deteriorating buildings, the main reason is the conventional property tax.


Edward J. Dodson, Director
School of Cooperative Individualism