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Robert Reich: Inequality for All—Fighting for the Middle Class

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At any point in time, all any exploiter of the populace wants is continuing growth. http://safeshare.tv/w/vwncRciSFb

"God has quit making land, but He keeps right on making people."

(The late Reuben Aaron Long, "sage of the sagebrush" -- among numerous other activities: cowboy, rancher, and owner of thousands of acres of south-central Oregon desert)

Getting back to the report itself: specious, naive, ignorant of recent social and cultural history, dismissive of geographic realities, lacking awareness of kinds and amounts of local natural resources and features, glassy-eyed with the artificial growth ethic, unaware of local diseconomies of scale, etc. In other words, what one usually gets from outside consultants brought in at considerable cost to give a take on matters they are not intimately familiar with, to please the particular agendas of those responsible for hiring them. To my admittedly jaundiced eye, this has nothing obvious to do with engendering a local economy that, using known factors, can be maintained (sustained) at a level beneficial to all citizens.

Hutch: Not only a phone company switching station on Crespi Drive, but also a substation in Vallemar.

Hutch, when you have businesses that have been open for more than 50 years (Pacifica Lumber), you know the town economy is really bad.

Yes, Pacifica Lumber was higher than Home Depot or Lowe's, but it also takes about an hour driving time back and forth to go over the hill.

The largest producers of sales tax revenue in Pacifica are the gas stations. These are followed by the 7-11s, the Quick Stop, and Safeway. If you think that's a "reasonable supply of retail" that captures enough sales taxes to make housing pay for itself, then we have nothing further to discuss.

I'v been in Pacifica 35 years, John, and I've seen the stagnation. I remember when we had two car dealerships, a phone company switching center, and everyone remembers the Seaview Theatre. I remember when Pacifica used to be the most affordable city on the Peninsula to rent or own. Now because of a housing shortage, that is all gone. We are losing ground, going backward. And if we don't do something, you are not going to want to live in a town with empty stores all over and crime on the rise. Nobody is saying to turn Pacifica into Daly City. Or build on all our hills. Nobody wants that. But our population has been at around 40,000 or less for more than 30 years. We have to allow some more increase in housing, say a couple hundred a year more. And include affordable housing in that mix, too. The Beach Boulevard Project is a good start (without the library).

I moved to Pacifica 20 years ago to get away from the crowds, traffic, and development over the hill. I love the peace and quiet here. Why would anyone in their right mind want to bring all that noise and congestion over here? If you want more houses, cars, and development, move to Daly City and have a nice life. Leave Pacifica clean and green. Thank you.

This is too easy. You're grasping at straws now, Peter. There IS a "reasonable" amount of retail in Pacifica: 2 hardware stores, 2 McDonald's, Ross, Taco Bell, Verizon, 2 Safeways, 3 other large markets, many other chain stores, and hundreds of restaurants and smaller places. Yes, we need more retail, but without an increase in population, it's hard to support more.

This document is proposed as land use policy, but it has several errors, inaccurate or incomplete analyses, and statements that haven’t been vetted by members of the community. See more at: http://www.pacificariptide.com/pacifica_riptide/2013/09/pacifica-city-council-meeting-agenda-september-23.html#sthash.c94I0lQT.dpuf

As I have been saying all along, "the gang of no" is slowly losing control of City Council and it does not like it. Now it is grasping at straws, roping the wind.

"Statements that haven't been vetted by members of the community" proves my point!

The Ohio State University report is about many studies, not just Ohio. The point of that summary is that the many studies are reliable and the principle they establish is shown to be true regardless of the variation in communities in terms of home values, property taxes, etc. Chris Fogel's post summarizes a vast amount of research demonstrating the principle that residential development costs the taxpayers more than the revenue it produces, across many communities. In the face of that many studies, it's not a valid scientific argument to say that it hasn't been proven with a study in our specific community.

The point of the quote from the San Mateo report is that the economic consultant said, "Housing can pay for itself if the home values are high, as this generates high property taxes and typically high sales taxes as well, as long as there is a reasonable supply of retail in the jurisdiction to capture those sales." But Pacifica does not have that supply of retail, so we wouldn't capture the sales taxes. We all know that the sales taxes we pay go "over the hill." Those taxes go to other jurisdictions where the sales are made. The result is that new housing, even if it had high home values and high property taxes, would not pay for itself in Pacifica. The San Mateo economic consultant also said, "Housing does not tend to pay for itself when the values are low and/or municipal service costs are high." I think that's the case in Pacifica.

I really feel bad for you guys. You spent a lot of time on this. Nice try, though.

Chris, your links are for farmland. And the one study in California was for Cuyahoga County.

I'll go with Peter's report from the City of San Mateo. It's the only one that is local and it says: "Housing can 'pay for itself' if the home values are high, as this generates high property taxes and typically high sales taxes as well."

I rest my case.

Peter, an "Ohio" study? Really? And "Leon County in Florida." Come on, man

And the one you actually provided for the City of San Mateo: "Housing can "pay for itself" if the home values are high, as this generates high property taxes and typically high sales taxes as well."

Thank you for proving my case.

"And don't forget that added population and housing generate a lot more than just property tax: more jobs, sales tax, sewer tax, fire tax, UUT tax, new businesses, etc. Don't forget to factor that into your 'proof.'"

And Bobby, WTF have we been talking about on the issue of the increase of the Utility Users Tax (UUT) on November's ballot? Do you think that's unrelated to the cost of city payroll and pensions, relative to the really sky-high cost of living here? Get a grip, man. We either say yes or no, and live within our limitations.

Ohio State University Fact Sheet
Community Development
Costs of Community Services
Land Use Series

Virtually all of the studies show that for residential land, the COCS ratio is substantially above 1. That is, residential land is a net drain on local government budgets. The average estimate ranges from about 1.15 to 1.50, which means that for every dollar collected in taxes and non-tax revenue, between $1.15 and $1.50 gets returned in the form of services by the local government and school district.

On the other hand, the COCS ratios for the other two land use categories are both substantially below 1. For commercial/industrial, the ratio usually ranges from 0.35 to 0.65, indicating that for every dollar collected, only about 35 to 65 cents worth of services are provided by the local government. For agriculture and open space, the ratios are only slightly smaller, usually ranging from 0.30 to 0.50.

The largest single expenditure category for communities, according to the studies, is the public school system, accounting for 60 to 70 percent of spending. Since open space and commercial development in themselves do not place any burden on the schools, it should not be surprising that their ratios are less than the residential category.

The studies do appear to be reliable because of the way in which taxes and service expenditures are calculated and imputed. The methods used in the studies have been laid out clearly. Regarding the variation in COCS ratios, it should be noted that they do not vary in any profound manner. The studies are unanimous in showing that residential land use ratios are above 1 and that the other types of land uses are below 1. The primary reason that the ratios do have some variation is that all communities are not identical. If, for example, many homes in a community are in an extremely high price range, and occupied by "empty nesters," the COCS ratio should be expected to be relatively low. On the other hand, low or middle income property occupied by families with numerous children would produce a higher ratio. Some communities have gone beyond simply calculating a COCS ratio and have actually calculated the "break even" home value for their community. Not surprisingly, these values tend to be substantially higher than the median (average) home value.

Initially, critics of the COCS studies argued that it may be difficult to generalize from these studies. This criticism has lost some credibility, however, because so many studies have been conducted in a wide range of communities nationally. The results seem to be unambiguous.

More recently, critics have developed the argument that only looking at the fiscal impacts on local governments and school districts is too limited in scope. They maintain that new residents do much more than simply pay taxes and demand services. Residents work, earn money, and spend much of it locally, and therefore contribute to the economic base of the community in a substantial way that is not captured in the COCS studies. The critics argue that future work should include these impacts.

But if COCS studies do not include these "multiplier" effects, it also must be said that they do not include non-economic costs to the community, such as the loss of scenic landscape, increased traffic congestion, and other variables associated with quality of life either.

http://ohioline.osu.edu/cd-fact/1260.html

According to the City of San Mateo Housing and Land Use Study Report: "The traditional perspective has
been that housing increases the burden of services for cities and does not "pay for itself"... According to the City's economic consultant on this study, who has performed these types of studies for several
jurisdictions, the answer is “it depends.” Housing can "pay for itself" if the home values are high, as
this generates high property taxes and typically high sales taxes as well, as long as there is a reasonable supply of retail in the jurisdiction to capture those sales. Housing can also pay for itself if the municipal expenses are low. Housing does not tend to "pay for itself" when the values are
low and/or municipal service costs are high.
http://www.cityofsanmateo.org/DocumentCenter/Home/View/1800

A 2006 study by Jeffrey H. Dorfman at the University of Georgia found that in Leon County in Florida, for instance, for every $1 generated by new residential development, the government would spend $1.39. The study focuses on replacing farmland with development, and concludes that commercial, industrial, and farm uses will save taxpayers money in the long run. The Dorfman study also measured the cost in 14 Georgia counties and found that for $1 of tax revenue, governments would spend anywhere from $1.13 to $2.27.

An earlier study from 2002 and 2003, commissioned by the 1000 Friends of Florida, The Conservation Fund, The Georgia Conservancy, and Tall Timbers Research Stations, focused on Leon County in Florida and two Georgia counties. It found that for every $1 in revenue generated by the residential development of farm and forest land, taxpayers pay $1.38.

A third study, commissioned for a specific development in Jacksonville in 2000, found that developing the undeveloped land would create $157 million in property taxes over 15 years but cost Duval County taxpayers $250 million.

The fourth study was commissioned for Sarasota County in 2002. It found that the typical Sarasota subdivision costs the county $1.53 for every $1 of revenue it generates.

Some development does more than pay for itself. The Dorfman study found that in Leon County, for every tax dollar generated by commercial and industrial development, taxpayers would have to pay $0.46 for services.

The Sarasota study found that expensive 5-acre ranches cost $0.57 for every $1 generated.

The bottom line is "it very much depends on the type of development what kind of ratio you get between the tax revenues received and the cost of public services," said Lance deHaven-Smith, a professor in the Reubin O'D. Askew School of Public Administration and Policy at Florida State University. "For a long time, we just wanted growth in Florida ... the thinking being we were going to bring in this growth and make a bountiful Florida.

"But now we know that not just any growth will do it," deHaven-Smith said. "It requires a mix that includes commercial and industrial and unless you actively plan for that, you don't get it."

edited for space from http://www.politifact.com/florida/statements/2010/sep/09/florida-hometown-democracy/development-doesnt-pay-itself-pro-amendment-4-grou/

"Landis (1991) found that in California, slow growth communities enjoyed greater revenue increases over expenditures than faster growing, pro-growth cities."

Cost of Community Services - Recent Findings, Cuyahoga County Planning Commission
http://planning.co.cuyahoga.oh.us/i71/impact03.htm

* * *

"A general finding of CCS studies is that commercial/industrial and agricultural/open-space ratios are less than one while residential ratios are greater than one. This is often interpreted to mean that commercial/industrial and agricultural/open-space land uses ‘‘pay their own way’’ while residential land uses do not."

"Ratios are affected little by municipality type or population change."

A Meta-Analysis of Cost of Community Service Studies, International Regional Science Review
http://environment.yale.edu/kotchen/pubs/COCS.pdf

* * *

"The more than 80 cost-of-community-services (COCS) studies conducted across the country found that residential development provides less tax revenue than it consumes in public service expenditures."

Development at the Urban Fringe and Beyond / AER-803; Economic Research Service, United States Department of Agriculture
http://tinyurl.com/kyqrxgu

* * *

Here is a report that summarizes the cost of community services for 151 counties in the United States. 150 of those counties spent more on services to residential housing than they recouped. A single community (Lehman Township in Pennsylvania) was the lone exception: housing brought in $1.06 for every dollar expended in services, but in contrast, commercial zoning brought in $1.80 for every dollar in that same community.

Fact Sheet: Cost of Community Services Studies, The American Farmland Trust and the United States Department of Agriculture
http://tinyurl.com/l7ohtnv

* * *

"Researchers from a variety of backgrounds have undertaken COCS studies. Regardless of who conducted the research, the results have been consistent. Virtually all of the studies show that the COCS ratio is substantially above 1 for residential land, meaning that they cost the community more in services than they generate in taxes and fees."

UC Cooperative Extension Land Use Fact Sheet Series, University of California
http://tinyurl.com/kdr7sk5

* * *

More reading at:

Financing Regional Infrastructure, National Association of Industrial & Office Properties Research Foundation
http://tinyurl.com/lt3cf9v

Fiscal Impact Analysis: Methods, Cases and Intellectual Debate, Lincoln Institute of Land Policy
http://www.lincolninst.edu/subcenters/teaching-fiscal-dimensions-of-planning/materials/kotval-mullin-fiscal-impact.pdf

Who Pays for Sprawl? The Economic, Social, and Environmental Impacts of Sprawl Development, Environmental Protection Agency
http://tinyurl.com/k7cxr6g

Costs and Revenues of Residential Development: A Workbook for Local Officials and Citizens, Penn State College of Agricultural Sciences
http://tinyurl.com/kdvn44p

The New Practitioner's Guide to Fiscal Impact Analysis, Center for Urban Policy Research

The Fiscal Impacts of Alternative Land Uses: What Do Cost of Community Service Studies Really Tell Us? (Journal of the Community Development Society)

Notice if you do a web search for "Cost of Community Services" it is all specific to a region: Indiana, Texas, Bla Bla County. Or for farmland in rural areas. There are no studies for San Mateo County that say new housing costs more in services than they generate in taxes. Nor are there any of your studies that say all regions are the same. But please show me I'm wrong.

Chris: Anyone can write an article (as you know). If there is so much "proof" and "many many studies" out there, then prove it! Show me one credible SCIENTIFIC study showing additional housing IN THIS AREA costs more in services than what they generate in property taxes. Still waiting for John to show me something. And please, no more sketchy studies about Texas or Michigan. Show me how this applies to the Peninsula, where we have some of the highest home prices in the nation.

And don't forget that added population and housing generate a lot more than just property tax: more jobs, sales tax, sewer tax, fire tax, UUT tax, new businesses, etc. Don't forget to factor that into your "proof."

Some dummies wanted to move the entire Fog Fest to Sharp Park School a few years ago. Where do they get these ideas? They should really bring back the classic cars. They drew people from all over. Just seems like there were more people when they had the classic cars.

There was talk about moving the Farmers Market out of Rockaway Beach; now they are talking about moving the Fog Fest to Rockaway. Some genius said, "Let's move the Farmers Market to the bowling alley parking lot." Once again they forgot this is a privately owned parcel, and I seriously doubt the owners would want their business parking lot tied up between 2 and 7 every Wednesday

How about a Burning Man type of festival in the Rockaway Quarry property?

My overall comment is that the so-called plan wasn't worth whatever the city paid for it. Look at the recommendations at the start of the report; these are all basic things that people have been saying for years.

The report seems fixated on the idea of developing Class A office and laboratory space. Different areas in the city are evaluated as to whether they could support this type of development. The idea is to attract high-tech startup companies.

I've worked at a series of high-tech startup companies for the past 15 years, and I don't think this is a viable plan. Once a startup gets to the point of needing office space, it is going to locate in a place that is convenient for the employees. The companies I've worked at were in Foster City, San Bruno, and San Francisco, which are easy to reach by car and public transportation. (I could see companies starting in Pacifica, since these days high-tech companies can get started in a coffee shop or someone's living room. But companies of that size don't need office space.)

Bobby:

There are many, many studies and articles written on the subject of the overall net drain residential housing represents to municipal revenues. Common land use and municipal planning puts the cost of providing services at $1.15-$1.50 for every dollar collected from residential zoning. Please Google "costs of community services" or "cocs ratio."

The new (old) Economic Development Plan stands out in one regard: It is lopsided. My greatest giggle came from reading the part about moving the Fog Fest to the Rockaway area. Where in the Rockaway area are you going to fit it, its patrons, and the annual Fog Fest Parade? Idiotic.

Then of course is the fun that came from reading about development in Rockaway Quarry. Folks (and especially staff) know by now that the quarry is a dead end, but to sweeten the delusion, the plan throws in Shamrock Ranch and that acreage directly behind Pedro Point Shopping Center that floods every year.

This report was done under the supervision of staff and committee members with one goal in mind: profit for committee members (who are predominantly local real estate folks) and staff (whose wages will be paid by taxes and fees generated by said committee members' land and development deals).

I guess this document, if approved, will be City Council member Mary Ann Nihart's legacy, as the committee is her "baby."

Sorry, John, you shouldn't believe everything the anti-growth folks like Peter Loeb and Rich Campbell say. It is NOT a proven fact in San Mateo County that more housing is a drain on public services. It is something the no-development proponents have tried to spin into fact. We're one of the richest counties in the country, with some of the highest home prices. This means our property tax is through the roof.

Please show me one shred of credible evidence that additional housing in San Mateo County costs more in services than it generates. And please, no more questionable studies from Michigan or Texas.

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