Sun Debate: Taxes, Inspections, Elections, and LHA

This is the second post about the Sun debate. The first is here.

The City has a relatively low residential tax bill. Is the high commercial assessment harmful to the City’s economic progress?

I had to read many studies about economic development in school. The general consensus of most researchers was that businesses rarely make location decisions based on taxes. Rather, they weigh issues ranging from permitting ease to resident disposable income to quality of life, depending on the nature of the business. Mr. Samaras used the excellent example of Trader Joe’s: Trader Joe’s doesn’t pay attention to taxes. They only come in if there’s a certain number of residents with a certain income. Often, for this reason, economic development agencies don’t give incentives to retail establishments because they use these types of formulas to locate. (This isn’t as true for offices and factories, nor is it true if a business is considering two sides of a border.)

Some candidates used this argument, while others simply felt city services shouldn’t be cut and residential taxes shouldn’t be raised. However, there was some dissension. Counselor Elliott, Mr. Bellanger, and Mr. Gitschier suggested continued targeted incentives to fill vacant properties such as Freudenberg. Counselor Leahy believed that they needed to do something for those who were already in Lowell, too; and Counselor Nuon supported “examining” the tax rate. Counselor Mendoca had a reminder: retail establishments pass higher rents onto consumers. (I’m not quite sure how Dunkin’ Donuts can still charge a dollar a donut no matter where they are.)

The current City Manager, along with his predecessors, have tried to “get their hands” around the inspectional service department. It has recently been restructured. Are the enforcement officers being aggressive enough with code violations in the City?

This has to do with putting the sanitary code/health and code inspection services together along with the new three-year cycle of inspecting all rental properties. This had a wide variety of responses. Counselor Martin and Mr. Mitchell focused on programs encouraging landlords to occupy their properties. Many counselors, such as Mr. Pech, Ms. Hargis, Mr. Samaris, and Mr. Mitchell focused on the need for more resources for those who are unable to afford improvements to their home while still pursuing “absentee landlords.” Mr. Millanazo highlighted a program for problem properties to be put under City receivership. The argument is that a community investment is worth it, as–never mind the human rights element–one dilapidated house can bring down an entire neighborhood.

Mr. Rourke, Mr. Pech, and Counselors Kennedy, Mercier, Nuon, and Elliott praised the progress and focused on considering more inspectors and/or more aggressive penalties, either immediately or after the new ordinances have time to take effect. Counselor Leahy mentioned the need to pay current staff a living wage–or “lose good people.” Mr. Belanger suggested regular visual inspections along with the three-year schedule. Counselor Lorrey mentioned that he spearheaded the Problem Property Task force, although other incumbents were quick to mention their support.

Should the city council have term limits? If so, how many years? Do you have thoughts on voting by district? How should the City increase voting?

This question wasn’t asked to every group, but of those asked, Mr. Mitchell and Counselor Nuon supported term limits, and they and Counselor Elliott supported district voting. Mr. Samaras seemed to support considering both ideas, but discussed which would be supported by voters. This is a critical issue: Lowell would be lucky to have 11,000 vote in a local election, while back in 1926, 11,000 attended a candidates’ forum.

There’s been some problems documented at the Lowell Housing Authority, both by the attorney general and the governor. In the meantime, the Governor has proposed to eliminate the housing authorities and put them under some time of sectional oversight. Is it time to elect commissioners?

Almost everyone supported–or at least did not oppose–regionalization. I’ve actually done some study on regionalization and centralization to higher levels of government (I’m indebted to Holzer and Fry who have done extensive research), and there are always pros and cons. It usually increases professionalism, but sometimes decreases responsiveness and doesn’t necessary decrease costs. Dan Rourke, notably, credits the authority for keeping the properties in good shape and having high levels of resident satisfaction. Housing is often a subject of discussion in cities, and often a candidate for a regionalization. States approach the issue differently, but there’s a recognized problem that the burden of providing affordable housing falls disproportionately on some municipalities: most often inner cities like Lowell or rural areas with low land values.

Mr. Gitschier and Ms. Doyle supported elections to give direct control to the oversight board, with Counselor Lorrey and Counselor Mercier mentioning they would consider such a set-up. Everyone else disagreed, sometimes saying better oversight by the City Council is necessary. Interestingly, Mr. Millanazo, who is a former director of the LHA, wouldn’t support direct election, but would support exploration of making the LHA a City department along with regionalization.


3 thoughts on “Sun Debate: Taxes, Inspections, Elections, and LHA

  1. I’m curious. Does your study of centralization and it’s (non-) impact on costs include the costs of the ‘mistakes’ that can happen when the less ‘professional’ models that are more distributed get into trouble? I remember reading Mark Green’s book “Selling Out” about his (2000?) campaign for Mayor of NYC and an in depth examination of campaign finance. In it, he makes the case that on the surface, publicly funded campaigns look more expensive to the tax payer. But if you include the costs of crony deals they more than pay for themselves. In this way, it’s important to not limit the examination of costs to the ‘directly affected’ balance sheet but to also consider cascading effects.

    • The research on cost impact is actually pretty spotty, as the way a town might report costs varies considerably from how a county or state might report costs, making it an apples-to-oranges comparison. Most of what I’ve read has been qualitative research based on before-and-after surveys. Officials surveyed tend to say they don’t believe the costs changed after centralization. This seems to largely be because a regional agency can provide the same service with fewer staff, but those staff tend to be paid more. The types of services that have been studied include fire protection, police, administration of schools, etc. Some services had a smoother transition to regionalization (those with low labor needs, or those that don’t need much community input to be run effectively).

      I think examples like the State of NJ taking over Camden’s police force are an exception, as they were replacing union labor with non-union labor.

      I find your question about secondary costs interesting. In my thesis, I interviewed officials who believed the increased professionalism brought about by regionalization saved money, but this was difficult to quantify. I haven’t heard or read anything about reduced corruption or reduced lawsuits associated with regionalization/centralization, but it seems plausible to me!

      • You might like to know that when Green does his calculation, he uses specific pieces of crony legislation to make his point. He has a further point in that his examples aren’t anywhere close to exhaustive so the math is likely even stronger than he presents.

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