In Miami, Florida, someone who has owned a home for 13 years—the average duration in the city—paid about $2,800 in property taxes last year, roughly half the tax bill for a new owner of an identical home, who paid about $5,200. This discount, the result of state tax breaks for longtime homeowners, was about $450 higher in 2018 than in 2017, according to the annual 50-State Property Tax Comparison Study by the Lincoln Institute of Land Policy and the Minnesota Center for Fiscal Excellence.

Florida is one of 10 states where local governments are required to assess parcels differently based on when they were last sold, a policy that favors longtime homeowners by limiting growth of the assessed values used to calculate tax bills. When real estate prices rise, these assessment limits shift more of the tax burden to newer homeowners, whose properties are assessed closer to the market value. Overall, in the 10 states requiring these tax breaks, and in two cities with similar policies, those who have owned their homes for the average duration within their city paid 29 percent less in taxes than new homeowners, up from a 19-percent discount percent a year earlier.

Assessment limits are one of many factors that influence property taxes in the United States. The report explores all of the major factors, providing a comprehensive analysis of effective property tax rates—the tax paid as a percentage of market value—in more than 100 cities in every U.S. state and Washington, DC.

Drawing on data for 73 large U.S. cities, the study explains why property taxes vary so widely from place to place.

Reliance on the property tax is chief among the reasons. Cities with high local sales or income taxes do not need to raise as much revenue from the property tax and thus have lower property tax rates on average. For example, Bridgeport, Connecticut, has one of the highest effective tax rates on the median-valued home, while Birmingham, Alabama, has one of the lowest. But the average Birmingham resident pays 36 percent more in total local taxes when accounting for sales, income, and other local taxes.

Property values are the other crucial factor explaining differences in tax rates. Cities with low property values need to impose a much higher tax rate to raise the same revenue as cities with high property values. For example, the effective tax rate on the typical home in Detroit, which has the lowest median home values in the study, is nearly four times higher than in San Francisco, which has the highest. In Detroit, to raise $3,105 per home—the national average tax bill on a median-valued home—would require an effective tax rate 22 times higher than in San Francisco.

The other drivers of variation in property tax rates include the different treatment of various classes of property, such as residential and commercial, and the level of local government spending.

The average effective tax rate on a median-valued home was 1.44 percent in 2018, with wide variation across cities. Four cities have effective tax rates that are at least double the national average—Aurora, Illinois; Bridgeport; Detroit, and Newark, New Jersey. Conversely, six cities have tax rates less than half of the study average—Honolulu; Charleston, South Carolina; Boston; Denver; Cheyenne, Wyoming; and Birmingham.

Commercial property tax rates on office buildings and similar properties also vary significantly across cities. The effective tax rate on a $1 million commercial property is about 2 percent, on average, across the largest cities in each state. The highest rates are in Providence, Detroit, Chicago, Bridgeport, and Aurora, where rates are at least two-thirds higher than average. Rates are less than half of the average in Fargo, North Dakota; Virginia Beach, Virginia; Honolulu; Seattle; and Cheyenne.

The report is available for download on the Lincoln Institute website:
https://www.lincolninst.edu/publications/other/50-state-property-tax-comparison-study-3

Will Jason is associate director of communications at the Lincoln Institute. 

Photograph Credit: iStockphoto/Aneese. 

As the nationwide affordable housing crisis intensifies, so does the fighting.

A lively group of advocates for more multifamily housing construction has gained momentum under the banner of YIMBY: Yes in My Backyard. They have a simple message: build more housing, and prices will eventually moderate. And they’ve had it with established neighbors who use local zoning and legal appeals to block housing construction—the infamous NIMBYs, who pledge: Not in My Backyard.

YIMBYism started off with a bang, fueled by frustration over the lack of new housing in the Bay Area. But lately the campaign has run into trouble. Some critics say that increased development—especially high-end housing and the attendant yoga studios and trendy coffee shops—leads affluent newcomers to “discover” low-income neighborhoods, causing gentrification and displacement. And residents of single-family neighborhoods cite worries about traffic, parking, and “neighborhood character.”

In California, legislation that would have fast-tracked dense housing projects near transit was derailed by a suburban lawmaker—even after the proponents added tenant protections and inclusionary housing, the policy that requires a portion of new residential development to be below market-rate. Opposition to greater height and density is deep.

So, what do the YIMBYs do now? Episode 2 of the Lincoln Institute podcast Land Matters features a wide-ranging conversation with housing advocate Randy Shaw of San Francisco, author of Generation Priced Out: Who Gets to Live in the New Urban America.

It’s very bad out there, Shaw says in the interview, as retired baby boomers in single-family homes defend their turf against changes that could in any way affect rising home values.

“I’ve said many times, the best job in the world is to own a single-family home in Noe Valley where the value increases $60,000 a year,” Shaw says, referring to an upscale San Francisco neighborhood. But he’s also optimistic and sees signs of progress in Denver, Austin, San Diego, and Seattle, which have removed some regulatory barriers to development while implementing inclusionary housing policies.

“For the first time, we have people who are testifying for housing, [who are] not connected to any developer. They’re saying, ‘I’m in the neighborhood, and I’m for housing.’”

You can listen to the interview and subscribe to Land Matters on Apple Podcasts, Google Play, Spotify, Stitcher, or wherever you listen to podcasts.

Learn More

Backyard Brouhaha: Could Inclusionary Housing Break the YIMBY Deadlock?

Photograph: Anthony Flint

“Lo que se mide, se controla”, dice la perogrullada comercial. Para bien o para mal, la idea también es aplicable para el diseño de ciudades e infraestructura.

Y la aparición de los macrodatos (conjuntos masivos de información sin procesar que se pueden obtener gracias a las nuevas tecnologías de compilación y almacenamiento) abre la posibilidad a nuevas mediciones que pueden informar sobre cómo planifican y gestionan sus proyectos los organismos estatales de transporte.

Se puede pensar en la labor de la iniciativa State Smart Transportation Initiative (Iniciativa Estatal de Transporte Inteligente, SSTI). La SSTI se fundó en 2010 en la Universidad de Wisconsin y utiliza el nuevo tesoro de datos como guía para tomar decisiones de uso y planificación del suelo en el mundo real. La SSTI combina y analiza datos sobre asuntos desde cómo las personas acceden a las estaciones de tránsito hasta cuán fácil les resulta llegar al trabajo o la tienda de comestibles, y así evidencia patrones que pueden ayudar para futuras decisiones.

La SSTI empezó a funcionar en 2018 en conjunto con la asociación sin fines de lucro Smart Growth America, cuyos programas incluyen recursos para los departamentos estatales de transporte y colaboración con la SSTI en varias ediciones de The Innovative DOT: A Handbook of Policy and Practice (El DOT innovador: un manual de política y práctica), una guía para “los departamentos de transporte (DOT, por su sigla en inglés) comprometidos con la excelencia y la innovación”. Hoy, la sociedad trabaja con más de doce organismos de transporte, funciona como una especie de base de conocimientos sobre políticas y ofrece asistencia técnica directa.

Una de las claves para aprovechar mejor los megadatos es encontrar el marco correcto. “Accesibilidad significa pensar: ‘¿Cuán accesible es este lugar?, en vez de: ‘¿A qué velocidad van los autos en cierta parte del camino?’”, explica Eric Sundquist, director de la SSTI. Este enfoque más holístico no es una idea nueva, pero está ganando fuerza, en parte debido a la mayor cantidad de datos y las herramientas más sofisticadas para ordenarlos. En las últimas investigaciones, la SSTI definió la accesibilidad como “la facilidad con la cual las personas acceden a oportunidades como empleo, tiendas, parques, escuelas y otros destinos. La ‘facilidad’ se mide en términos de la duración del viaje, con algunos ajustes que explican cómo los pasajeros usan el sistema”.

Entre otros proyectos, la SSTI estuvo trabajando con el Departamento de Transporte de Virginia, cuyo programa Smart Scale recurre a los macrodatos para “calificar” las propuestas de transporte que envían los municipios y condados según la capacidad probable de mejorar la accesibilidad al trabajo. La ronda más reciente también incorpora el acceso a destinos distintos al trabajo, como centros comerciales y parques.

Por ejemplo, un ejercicio de planificación de la SSTI se centró en mejorar el acceso a destinos distintos al trabajo en Vienna, Virginia. Una parte del análisis exploró cómo fortalecer una red de senderos peatonales y ciclovías puede conectar mejor la calle principal de la ciudad con otros barrios. Pero otra parte consideró un escenario que incluía un cambio en el uso del suelo: alentar el desarrollo comercial de una zona infrautilizada en el límite sur del pueblo. Este último en realidad generó mejoras en accesibilidad con mejor puntaje que los proyectos hipotéticos de transporte.

Este esquema de puntajes se basa en datos de población, empleo y uso del suelo; de automóviles; de servicios de tránsito que, hoy, en gran parte se informan en un formato congruente gracias a Google Maps; y de bicicletas y peatones. Según el proyecto, se pueden agregar más datos, como categorías de empleo e ingresos del vecindario. Esto amplía las posibilidades de pensar cómo se puede mejorar la “accesibilidad”, medir si la mejor opción es construir nueva infraestructura peatonal o trabajar para colocar una tienda de comestibles en un desierto alimenticio.

“Hemos logrado que la gente sea consciente de esto en la comunidad donde operamos”, agrega Sundquist, para que otros DOT puedan trabajar sobre las mismas ideas. Y, de hecho, hace poco los funcionarios del transporte de Hawái trabajaron con la SSTI para intentar llevar el proceso de puntaje “un poco más allá”, agrega.

“Puntuamos todos sus proyectos sobre una base parcial de accesibilidad. Entonces, si un proyecto ofrece más acceso por transporte que en auto, sugerirá cómo cambiarían los modos”. Hoy, el estado está evaluando los resultados de la SSTI.

Amy Cotter, directora adjunta de Programas Urbanos del Instituto Lincoln, indica que estos datos representan mejoras totalmente nuevas en los métodos existentes de recolección de información y en las mediciones.

Dice que, por ejemplo, muchas veces, la planificación de decisiones dependió mucho de los resultados de encuestas sobre el tránsito, que “son caros de obtener y, en ocasiones, cuestionables”. Entonces, las tecnologías emergentes que está recolectando la SSTI (como “trip-making data”, o datos de viaje, seleccionados de los servicios que suman la información de vehículos con GPS habilitado, aparatos de navegación e incluso apps de smartphones) son una alternativa seductora. “Estos datos nuevos ofrecen mejor información a un costo inferior, y preparan a organismos, planificadores y DOT estatales para tomar mejores decisiones”, dice Cotter.

El Instituto Lincoln se asoció con la SSTI en 2017 para un proyecto, “Connecting Sacramento”, junto con varias entidades y partes interesadas del sector público y privado. Esto dio como resultado un estudio que catalizó gran parte de las últimas labores de la SSTI con el fin de evaluar cómo las nuevas fuentes de datos y las nuevas herramientas para entenderlos pueden ayudar a mejorar las políticas de transporte.

La investigación de Sacramento incluyó un caso de estudio sobre los trayectos a pie desde y hacia una estación de tránsito en particular. La SSTI trabajó con StreetLight Data, una empresa emergente de análisis del tráfico que elaboró métodos de evaluación de señales de GPS con aprendizaje automático para distinguir conductas de viajes a pie y en bicicleta. Sundquist dice que, a veces, ambos métodos de viaje “fueron tratados con displicencia” en las labores de planificación, justamente “porque son muy difíciles de medir”. Entonces, si se agrega esta información nueva a otros datos de transporte y uso del suelo, puede haber nuevos descubrimientos. En este caso, los datos señalaron un porcentaje inesperadamente alto de viajes a pie entre la estación de tránsito y un centro particular de edificios de oficinas. Esto sorprendió, dado que los edificios no solo tenían mucho lugar de estacionamiento, sino que además solo había una forma de acceder a pie: cruzando la autopista. El estudio afirmó que, en vistas de este descubrimiento, corregir o agregar puntos de acceso podría mejorar la condición de quienes viajan hacia el trabajo y alentar a que se sumen más personas.

Por supuesto, este tipo de análisis puede estar a kilómetros de las realidades que vive un departamento de transporte estatal. Pero los programas tales como el sistema de puntaje Smart Scale de Virginia sugieren a qué puede llevar el análisis de macrodatos. Si se sigue mejorando en la recolección y el análisis de datos, deberíamos poder evaluar mejor el impacto de un determinado proyecto, compararlo mejor con lo que se predijo y adaptarlo para el futuro.

El cliché de “lo que se mide, se controla” a veces se usa incorrectamente para afirmar que lo que no se mide (o no se puede medir) tampoco se puede controlar, o no hace falta controlarlo. Pero, tal como afirma Sundquist, estas nuevas formas de datos y análisis sobre el transporte se pueden ver como una oportunidad. Pueden revelar información práctica factible. Y también pueden ayudar a los planificadores, administradores de transporte y otras personas a pensar con creatividad sobre qué desearían medir después.

Rob Walker (robwalker.net) es periodista; escribe sobre diseño, tecnología y otros temas. Su libro The Art of Noticing (El arte de darse cuenta) se publicará en mayo de 2019.

Imagen: Uno de los mapas de “Connecting Sacramento”, un proyecto ejecutado por State Smart Transportation Initiative con socios como el Instituto Lincoln. El estudio evaluó cómo las herramientas nuevas y los datos pueden ayudar a mejorar la política de transporte. Crédito: State Smart Transportation Initiative

If a major development project is sprouting up near you, there’s a good chance the local government is using tax increment financing—an increasingly popular method of earmarking future property tax revenue to jump-start construction. Cities have used TIF more than 10,000 times from coast to coast in recent decades, and the number grows each year.

Like much in public finance, TIF can seem obscure, but it has become so widely used, it is attracting attention. Among the concerns: the use of tax dollars for private development, which siphons away money for schools or other services; the danger of TIF projects exacerbating gentrification and displacement; and a general worry about transparency.

“The appeal of it is that it seems to many people like free money—you don’t have to raise taxes, but get to spend money on a particular kind of development,” says economist David Merriman of the University of Illinois, Chicago, a leading expert on TIF who advises public officials on the subject.

I interviewed Merriman for the first episode of the Lincoln Institute’s new podcast Land Matters, a behind-the-scenes look at what makes cities tick. The podcast explores how many of the biggest challenges that cities face, whether financing infrastructure, adapting to climate change, or building more affordable housing, can be traced back to land.

Our conversation covers just this kind of territory—the intersection of land use and public finance, in the form of the property tax. We discuss what the research tells us about the effectiveness of TIF, why community pressure is prompting significant modifications to the tool, and how Merriman’s home city of Chicago has gone all-in on TIF, locking up a third of its property taxes.

You can listen to the interview and subscribe to Land Matters on Apple Podcasts, Google Play, Spotify, Stitcher, or wherever you listen to podcasts.

Learn More
Improving Tax Increment Financing (TIF) for Economic Development
The Hidden Costs of TIF

Photo by Michelle Charles/ Stillwater News Press

F

or an afternoon, in 2015, residents temporarily transformed an aging business district in Akron, Ohio’s North Hill neighborhood. Local business owners and leaders worked with the Better Block Foundation to demonstrate what more was possible for the intersection of North Main Street and Cuyahoga Falls Avenue. Pop-up businesses, parklets, bike lanes, and art installations erased vacancies and reinvigorated a space that, in the early 20th century, had been a pioneering route for the city’s streetcar.

But today, despite the much-lauded 2015 vision, there are still several vacant lots and storefronts for every heavily trafficked Nepali grocery store, Italian restaurant, or church lining the four-lane thoroughfare, which drives a wedge through the central business district.

The city is focused on revitalizing North Hill as part of a six-month pilot project that is convening local leaders with their counterparts in Rochester, New York, and Lansing, Michigan. This community of practice, organized by the Lincoln Institute of Land Policy and the Rose Center for Public Leadership in Land Use in partnership with Enterprise Community Partners and the American Planning Association, seeks to explore the challenges of equitably revitalizing midsize postindustrial cities—sometimes known as legacy cities. The project includes visits to each city, coaching, webinars, and technical guidance.

Concentrated most heavily in the Midwest and New England, legacy cities were once essential to building American middle-class prosperity. Yet as the national economy has transitioned away from manufacturing, many of these communities have struggled with entrenched poverty, disinvestment, population loss, vacancies, and a workforce with skills that do not match employers’ needs.

Small and midsize legacy cities face even greater challenges because they often lack major corporate headquarters or significant anchor institutions, assets that have been leveraged successfully in larger postindustrial cities such as Pittsburgh. 

“These cities are often overlooked in national efforts at revitalization,” said Jessie Grogan, senior policy analyst at the Lincoln Institute. “While researchers and community leaders have identified strategies to revitalize places like Detroit and Baltimore, less attention has been paid to how these approaches might transfer to communities like Akron.”

Challenges in North Hill  

By many measures, Akron is a typical smaller legacy city. After earning recognition for having the nation’s fastest growing population in 1916 and for being home to Goodyear and other manufacturing giants, the city has lost about a third of its residents since the 1960s, recently stabilizing at around 200,000.  

North Hill has fared better than many parts of Akron, due in part to the new wave of immigrants who have followed in the footsteps of the Italian, Polish, and Irish who arrived a century ago. The tracts of single-family rental homes surrounding the central business district now house a more diverse population than 80 percent of U.S. urban neighborhoods. These immigrants from countries such as Nepal, Myanmar, and Bhutan have helped to populate homes and storefronts in a city trying everything to bounce back from decades of population loss. They have found opportunities in business ownership and jobs in science, technology, engineering, and mathematics.

In 2017, the Knight Foundation recognized North Hill as an up-and-coming neighborhood at a “tipping point,” and provided funding for the North Akron Community Development Corporation to pursue concentrated business development. Yet, the city has found it difficult to guide North Hill because of aging infrastructure, speculative landowners, and difficulty engaging local residents in leadership and decision-making. 

During a recent convening of the community of practice in Akron, participants visited the Exchange House, a permanent product of Better Block’s pop-up experiment. With $155,000 from the Knight Foundation’s Knight Cities Challenge, Better Block rehabilitated a single-family home into a space that now includes an upstairs AirBnB; space on the first floor for health clinics, sewing classes, and spiritual group meetings; and a pocket park in the backyard. 

As manager, Katie Beck helps to organize events like Multilingual Meals, during which attendees discuss community issues in nine different languages. She sees the potential for groups to interact across ethnic and socioeconomic lines, but also the challenges of building a sense of community among such a diverse population. 

“North Hill has silos, lines, and boundaries between different communities,” Beck said. “At the Exchange House, we are able to observe and reflect on those boundaries, while we aim to cross those lines through diverse programming in our space.”

While North Hill has always been a neighborhood of immigrants, it has also long been home to a large African American population, which experienced devastating urban renewal in the mid-20th century. Revitalization efforts often focus on branding the area as an international district, but doing so leaves these residents out of the narrative, Beck says.

As part of the tour of North Hill, participants from Lansing and Rochester joined Beck, Akron city officials, and other local civic leaders, including representatives from Asian Services in Action, Bridging the Gap Ministries, and Urban Vision Ministry, for a roundtable at the Exchange House.

“Having that conversation in that broad of a group really brought to the forefront that there are a lot of different views about how the community should move forward,” said Heather Roszczyk, innovation and entrepreneurship advocate for the Mayor’s Office of Economic Development in Akron. “It firmed up the message that we need to have additional community conversations, even among the leaders, to figure out a collective way forward.”

The cohort walked through North Hill’s business district, site of the 2015 Better Block project. Roszczyk said that promoting the business district can be challenging: business owners not only have to come up with the capital to get their businesses off the ground, but also the funding to rehab and repair aging infrastructure. In addition to vacancies, the business district has a number of lots where businesses have been torn down. 

“Although North Hill has had a lot of energy, this hasn’t translated to construction,” said Jason Segedy, Akron’s director of planning and urban development.

In some cases, landlords who own properties on the stretch have been unresponsive to interested buyers. “To some extent, we have a landlock on economic development,” Beck said.

North Hill’s business district is part of Akron’s Great Streets Initiative, which aims to enhance the city’s business districts through community engagement, business development, and improved public spaces. While only a handful of business owners have reached out about the vacant spaces on the main street, programs like the forthcoming Rubber City Match are designed to help fill this pipeline. The city will work with community leaders to assess the needs of the North Hill business district and use neighborhood data to direct business owners to promising locations.

“We are really the testing ground for different economic development methods, of what could be successful in other parts of the country,” Beck said.

Finding a Way Forward in a Community of Practice

While each city is still finding its way forward, lessons are already migrating from place to place. In Lansing, a visit with the Capital Area Housing Partnership left a lasting impression on Akron’s Segedy because of the organization’s strong community presence. It inspired him to think about how the Exchange House could expand its offerings and potentially open up additional centers throughout North Hill. Segedy was also inspired by the transformation of an abandoned auto warehouse into the Lansing Brewing Company, and of a former school building into the Liberty Hyde Bailey Center, which contains affordable senior housing, day care, and space for performances and other activity.

“There haven’t been any huge revelations, but it has been very valuable to compare notes and see the different approaches these cities have taken to redevelopment,” Segedy said.

Where organizers see the cities’ common challenges, such as community engagement, the community of practice brings in experts to facilitate a conversation.  

At the convening in Akron, participants learned how a larger legacy city—Detroit—engaged residents in long-term planning. Charles Cross, director of landscape architecture for the nonprofit Detroit Collaborative Design Center, described how his team collaborated with residents in the Detroit Works Project, a planning process that produced the Detroit Future City Strategic Framework, a comprehensive document intended to guide Detroit’s revitalization.

Cross’s team traveled around Detroit with a roaming table to stimulate discussion, created a home base for drop-in conversations, held Twitter town halls, built a mobile phone app, and sought out residents in public spaces throughout the city. Through the work of the design center and other partners, an estimated 30,000 conversations helped shape the framework.

“Each of the cities, to varying degrees, seems to feel that, ‘we are the city so we can’t do that; we are distrusted by the immigrant population or the longstanding African American population,’” said Amy Cotter, associate director of Urban Programs for the Lincoln Institute. “Through the conversation, presentations, and programming, we aimed to focus on how city governments can forge unconventional partnerships to achieve more.”  

Emma Zehner is communciations and publications editor at the Lincoln Institute of Land Policy.

Photos in order of appearance:

In 2015, residents worked with the Better Block Foundation to temporarily transform North Hill’s business district, adding bike lanes, parklets, and pop-up businesses. Credit: Better Block Foundation.

The owners of Dhimal’s Mini Marts stand outside the grocery store, which is located in North Hill. Credit: Shayne Wynn.

The Exchange House has become a central gathering space for residents of many ethnicities in North Hill. Credit: Exchange House.

North Hill residents gather for Multilingual Meals, an event at the Exchange House. Credit: Shayne Wynn.

Jason Segedy, director of planning and urban development, at the City of Akron, speaks to community of practice participants from Akron, Lansing, and Rochester. Credit: Amy Cotter.

As part of the meeting in Lansing, participants stopped at Akronym Brewing. Credit: Amy Cotter.