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Not really. Unless you get efficiency gains, all the income from the government charging itself rent gets eaten up as expenses for paying itself rent. Basically
by ThrustVectoring 9y ago
Not really. Unless you get efficiency gains, all the income from the government charging itself rent gets eaten up as expenses for paying itself rent. Basically what it's doing is making imputed rent an explicit budget item, and then allowing financial ~stuff~ to be done with those budget items explicitly (say, letting a department save money by using real estate more efficiently).
- mathattack 9y agoMy interpretation was they charge other people rent for the services, no?
- ThrustVectoring 9y agoNot at first. It's fixing an accounting rule that draws distinctions between equivalent cash-flow situations. A: City owns an office building with a $1MM/yr fair-market rent, which it uses for administration. B: City collects $1MM/yr rent from their office building, and pays $1MM/yr to rent out a different building for their administration to use. If you net out the imputed rent in situation A, then it looks like the administration is $1MM/yr cheaper than it actually is.
- mathattack 9y agoAhh - got it. Thanks!