Source: Richardson Coalition PAC.
|Richardson Tax Revenue: Residents vs. Business |
"Our city's success in economic development has resulted in a tax transformation for our city." That's how the Richardson Coalition PAC explained the graph above.
After the jump, unpacking their explanation.
E.H. Carr: "Study the historian before you begin to study the facts."
The first thing to notice is that the Richardson Coalition is not really a coalition. It's a political action committee. It raises money to influence elections to promote its own partisan agenda. Nothing wrong with that, by the way, it's just important to know what we're dealing with when we read things like the following:
Yes, this shift in the balance of tax revenues can be seen as great news for residential taxpayers, assuming there hasn't been an equal shift in the balance of government services away from residential taxpayers at the same time. In that case, it's a wash. So, what's the bigger picture here? The Richardson Coalition PAC doesn't bother to say.This is great news for residential taxpayers, as the majority of taxes collected has shifted from residential to business property owners.
After the tech bust hit in 2001, which resulted in fewer jobs and more empty business office space, residents were left paying about 60% of the tax burden. Now, with all of the new business development, there has been a shift back to a ratio that relieves the homeowner from carrying too much of the tax burden. Diversification of the tax base should stabilize the ratio going forward.
Even better news is that these results do not include future developments which have the potential to have further positive impact.
This transformation is a result of the resolve of several city councils and steadfast management by our former and current city managers and city staff, as well as the Chamber of Commerce's Richardson Economic Development Program.
Continued balanced, managed growth will allow our city to have yet another renaissance.
Source: Richardson Coalition PAC.
And why pit businesses against residents anyway? It's almost as if the Richardson Coalition PAC forgets that it's Republican. Mitt Romney: "Corporations are people, my friend... of course they are." You might think that the Richardson Coalition PAC really wants businesses to carry a bigger share of the tax burden. That can't be right. Mitt Romney again: "We will champion small businesses, America's engine of job growth. That means reducing taxes on business, not raising them."
But let's be generous here. Let's assume the argument here is that it's new business development that has resulted in the increase in business taxes, not an increase in taxes on existing businesses. I wish the Richardson Coalition PAC would make this case, but it doesn't. Maybe it can't. Because some of that "new business development" the Richardson Coalition PAC trumpets is just shifting existing business around. The Dallas Morning News: "State Farm's move to Richardson will leave behind big blocks of empty office space" including a lot in Richardson itself.
But let's be generous here, too. Let's assume that there is indeed significant "new business development" in Richardson. Who should get the credit?
The Richardson Coalition PAC credits the "resolve" and "steadfast management" by city leaders. No hint of a general rebound nationally (U.S. GDP growth of 5% in 3Q 2014; record corporate profits and stock prices; unemployment down to 5.6%).
On the other hand, note how the Richardson Coalition PAC assigns no blame locally for the empty offices and loss of jobs after 2001. That was blamed on the "tech bust," like some impersonal force no one could have foreseen. Curiously, the graph supplied by the Richardson Coalition PAC shows that residents were carrying 60% of the tax burden in 2000, that is, even before "the tech bust hit in 2001" as the PAC says. Maybe, in fact, the reason that businesses carried only 40% of the tax burden in 2000 was due to something other than the "tech bust." But blaming the "tech bust" fits the Richardson Coalition PAC's story better, so let's go with it.
In short, according to the Richardson Coalition PAC, last decade's shift in tax burden onto the backs of residents was due to forces outside the control of Richardson's leaders, but the recent shift in the other direction is solely due to their "resolve" and "steadfast management." Yeah, that's the story.
In fact, there is something significant going on, not just in Richardson, but nationally. It might even be great news for Richardson. But it's probably due as much to the country as a whole climbing out of the Great Recession of 2008 as to anything happening down at City Hall or the Chamber of Commerce. Those vacant properties in north Richardson were bound to be developed in any case just as soon as the economy improved. But a tougher local challenge, one that might need local resolve and steadfast management to solve, might be, say, businesses in southwest Richardson. How is that looking? Not so good? But don't expect to get the whole story from a political action committee. The Richardson Coalition PAC is not some kind of non-partisan public service organization after all.