State Shared Revenue and Tax incentives

As a general rule, I am against tax incentives given to businesses by cities. I think it is generally a scam where the business already has made a decision and plays cities off of each other. This article from EVT has the latest.

Like most things in the world it is not as simple as people think. Cities in Arizona have very specific needs for funding especially after they hit build out for State Shared Revenue. By build out, I mean the point where a city is no longer growing and can no longer rely on annual increases in shared revenue (Revenue is based on a city's population relative to the rest of the state). Cites must look for commercial projects to provide revenue. Bedroom communities have specific problems at build out because homes don't provide a lot of revenue, but require a lot of services. This is why a car dealership is such a great boon to cities. The dealership will not only pay property taxes (at a higher rate than a home), but will provide a ton of sales tax.

The way incentives should work is that they give a break on X dollars of the property or sales tax, they assume or project Y amount will be produced by the business (Y should be higher than X). Sometimes these deals take longer to payoff than others. This means that sometimes the city will see little revenue for say 5 years. The other positive for cities is that commercial interests are relatively stable sources of revenue because their facilities are big investments. Most cities are trying to create a stable and long-term funding base, so they can provide services to you (and not become insolvent) without raising your taxes.

Just in case you ever wonder why our cities dole out incentives...

HOA Redux

I have been off blogging for a while... I am not really sure anyone reads this anyway. Here is the latest update in the effort to regulate HOAs here. It looks like they are getting hit from the left and right.

Global Warming: Arizona Republic Style

It is amazing that we have come this far on Global Warming... Our local right-wing columnist at the Republic admits its existence here. What is funny is that he is reduced to nit-picking various facts from an Inconvenient Truth. I agree with his analysis for the most part, but not his characterization. He is critical of Gore for giving some worst case scenarios for the affects of Global Warming, but Gore does not claim inevitability. I find it interesting that we are all of the sudden worried about slight nuances in a documentary when we have things like Iraq and 1% doctrine from the Bush administration.

The 1% doctrine is Cheney's idea that if there is even a 1% chance of terrorists obtain WMDs that we should basically react as though they have them. Cheney described it as "low-probability, high-impact event". What would our reaction be if there was a 1% possibility of terrorists raising sea level by 20 feet and displacing millions of people?

I just think the juxtaposition is very interesting. I think it shows how the reaction to both issues are out of whack...

HOA: What do you think?

HOAs have always troubled me. I don't like the idea of an organization that is easy influenced and unaccountable being able to seize property. While I think they serve a purpose, I also think there should be something akin to a bill of rights for homeowners. There is this article about reigning in just one of their powers.

The issue is whether an HOA should be able to regulate parking on publicly funded streets. I think this is a no-brainer. No. If my tax dollars help pay for your street, then I should be able to park on them according to tax payer agreed rules (ie the rules of the city or county). The leg does something right, go figure...

Our Dumb Legistlature: State Shared Revenue addition

Our legislature is sooo dumb... How dumb are they you might ask? Just look at state shared revenue. SSR is a pretty obscure thing to most people. In a nutshell, SSR means that each city/county gets a portion of the income tax paid to the state. There is a formula for figuring the amount that the legislature frequently tries to change. Basically, every entity gets a certain amount based upon their population.

Why is this important? Have you ever wondered why relatively small cities such as Gilbert, Chandler (several years ago) etc have such nice roads and infrastructure? State shared revenue is a big part of the answer.

The legislature tries almost every year to break this system. Here is this year unsuccessful attempt. One of the more humerous attempts to change the system came from John Huppenthal last session. I think he tried to eliminate state shared revenue, but he forgot most of his continuents live in Phoenix and Chandler. They would have been two of the hardest hit cities.

It only takes living a short time in a place without such a rational system to realize how well it works. The results are poor cities that stay poor with no opportunity for change. In AZ, a city like Avondale can go from a tiny farming community to a well run city. I wish the leg would wake up...

Destoying South Mountain for convenience

There has been a plan for a longtime to build a freeway through South Mountain Park. These articles give some of the back ground 1, 2. This is just a shame... Am I the only one that thinks that they should not be able to build a highway through any park land?

This group is fighting it www.protectazchildren.org (website not up yet...)