7 ms·

I saw a few articles like that on Strongtown. They make for a good story but frankly economically they do not make sense for me. In my surburban town with prett

I saw a few articles like that on Strongtown. They make for a good story but frankly economically they do not make sense for me. In my surburban town with pretty big lots, school taxes are 2/3 of property tax and things that are more expensive in surburban setting than in the city (roads, sewer, electric, gas hookups) are something like 10% of taxes. Even in this story, city currently spends 3.2M/year maintaining the roads. City has 15k housing units so city currently spends roughly $200/house on roads. It's $16/month. Author thinks city actually need to spend 4.2M - this is $280/year per house which is only $23/month. That's really not much even if cost need to be doubled. Hardly unaffordable. This is per dwelling - not even per person and does not count that commercial buildings pay more so residential rate is even lower. Electric/water/sewers generally pay for themselves thru user fee - I think average is $20-60/month/house for sewer/water in US and electric is thru usage fee. School busing in rural setting is probably a bit more expensive but is still rounding error in overall school budget. Everything else - school, governance, police, fire are probably about the same in rural areas and in the dense city. SF is a shit city with 15k/year spending per person and most rural/suburban areas are much nicer on a fraction of that spending. Overall rural lifestyle does not cost much more than the city in infrastructure costs - and I did similar calculations for previous strongtown articles. On a feeling level it make sense that dense city should be cheaper but reality is frankly it's not. US cities has a lot of problems but frankly cost of maintaining roads is not the thing that will bankrupt them.

300bps 5y ago
Yeah I saw his property tax of $1,600 per year and how it was already too high to raise. Tax rates of $8,000 to $20,000 are common around me.
- cableshaft 5y ago
  Galesburg is a declining city in the middle of nowhere. People who live there probably drive to work ~50 miles away to Peoria or Davenport/Moline every day if they don't have a (probably) low paying job in town. And if that's the case, they'd probably be better off moving closer to those cities, there's probably even cheaper homes within a shorter commute. Also it's in Illinois, which is #2 in the country for highest overall property taxes[1]. Keep in mind he said a reasonable house value just north of their downtown is $75k, where the national average price for a home is $374k (as of Q2 2021), which is 5x the price. $1600 * 5 = $8000, which brings it up to what's near you. And considering Illinois' property tax is higher than every other state other than New Jersey, I'm guessing the homes appraised value near you is likely a lot higher than $374k, even. That being said, I don't understand why the government wouldn't be able to up just the city's percentage (as opposed to all line items on the property tax bill) by about $100-200/yr per person and use that to help close the gap. The percent going to the city of Galesburg is currently a tiny percentage of the overall tax. [1]: https://www.illinoispolicy.org/illinois-again-ranks-no-2-in-u-s-for-highest-property-taxes/ https://www.illinoispolicy.org/illinois-again-ranks-no-2-in-...
  - mitigating 5y ago
    People will fight against any tax raises regardless of the amount.
    - cableshaft 5y ago
      Well yes, that's one reason it probably isn't being raised. But if you could let the people know that "hey, this is going directly into fixing the roads, and your property tax will only go up $8 per month to afford it, otherwise your roads will stay shitty", I think most people could be convinced to go along with it.
      - pharke 5y ago
        It would be helpful if you could just go to a website, enter in a code from your property tax bill and see exactly how every dollar of the taxes you paid were used. This is one of the valid uses of a public ledger I can think of. In my opinion, all tax funded spending should be traceable like this with each transfer recorded and reported to the tax payer.
        gruez 5y ago
        Doesn't checking the city's budget do the same thing? The only thing that site would add is multiply the budget amounts by your tax bill.
        pharke 5y ago
        I don't feel like that addresses the part of the comment I was speaking to: > "hey, this is going directly into fixing the roads, and your property tax will only go up $8 per month to afford it, otherwise your roads will stay shitty", I think most people could be convinced to go along with it. At a minimum, you could create a system that takes the budget and shows a percent breakdown of where your money goes. If you packaged it nicely so that you could understand it at a glance it would go a long way towards what the comment I was responding to was talking about. After looking at my city's budget, I think there is still a lot of room for improvement. For my municipality at least, it seems to be a mix of specific and extremely nebulous items. I can see that the fire department purchased several new vehicles and even the type of vehicle but the road works department just lists additions to their "fleet" and the sanitation department just lists "new vehicles". I see items for sidewalk and street repairs along with the name of the street but no indication of how much pavement was repaired or what the breakdown of labor vs materials was. I think knowing all of the details would help the public assist their representatives to correct overages and would be a bulwark against corruption. e.g. If I run a business that sells fasteners and I see that the city government is overpaying by 30% for the bolts they use to put up new street signs I could bid on the contract next time around or maybe tip off the newspaper if it's more like 200% over retail.
- umvi 5y ago
  Start charging $20k property tax and you'll probably accelerate the decline of Galesburg as people scramble to relocate to more affordable areas.
- milesskorpen 5y ago
  Absolute numbers aren't a tax rate. 1% of $2M home gets you to $20k/year easily. But the article talks about $100-200k homes; there is no way this town can have a 10-20% property tax rate.
- cortesoft 5y ago
  That $1600 is based a 10% tax rate, if you look at the chart. That means the whole property is only worth $16,000. Are you really suggesting they charge more every year in taxes than the house is worth?
  - rdtwo 5y ago
    At the very low end there is a minimum tax regardless of property value. If you fall below a certain value you end up dragging down the community
- gnopgnip 5y ago
  If you live in Galesburg IL, or Jackson MI, Altoona PA, Rome NY or similar places if the property taxes were raised to 10x as much the homes would be worth literally zero. The rental income wouldn't cover the property taxes. And that is the underlying problem, when the costs are so high, collecting a "fair" or actually necessary amount of taxes has a debilitating effect on the economy
burlesona 5y ago
You are mistaking "what Cities spend on maintenance" for what it would cost to fully maintain the system. The author does a good job spelling this out: > If we convert 177 miles into feet it’s 934,560 feet of road. At $20 per foot per year, we would need to spend on average $18,691,200 a year on road maintenance just to keep all of our roads properly maintained. Note his actual estimate is ~$18.6M not the ~$4M you quoted - that was his hypothetical "even if I'm wrong by 4x too high" number. > According to the capital improvement plan from earlier we are planning to spend an average of $3,220,000 per year. Note that the author's cost figure is just for roads and does not include other similarly expensive infrastructure like water lines that are included in the city's Capital Improvements budget. The reason for this gap in infra funding is they don't have the money, so they let most of the infrastructure decay, and use the money they have to patch the worst problems as best they can. Every city in America is doing this. We just so used to it we don't think anything of driving on roads that are full of cracks and potholes and generally falling apart. This gap is why the American Society of Civil Engineers gives the US a C- on infrastructure. (https://infrastructurereportcard.org https://infrastructurereportcard.org)
- tptacek 5y ago
  Not that I disagree with your sentiment but the comment you're responding to observes that water lines --- the extra infrastructure beyond roads not included in the article's estimate but sort of implied as being significant --- are generally paid for by user fees, not property taxes.
  - burlesona 5y ago
    I think this varies widely so any generalization needs many caveats… but I don’t think you can assume that. What I’ve usually seen is that water service, ie the cost of filtration and sewage treatment and maintaining pumps, is paid by user fees. Water infrastructure - the actual pipes - are usually considered capital projects and maintained out of different funds. But again the details vary on a subdivision by subdivision level not to mention state to state.
    - 5y ago
fredophile 5y ago
The author thinks the city needs to spend a little over $18M per year just on roads. That would be about $1200 per year per house or $100 per month. Considering that their total property taxes are currently around $1700 per year in total property taxes that's a huge increase.
- dfadsadsf 5y ago
  To get to 18M number, author approximated that cost of repair 3.5 lane medium use road in industrial area (aka heavy trucks) to all roads in the town which just not make sense. Cost of repair low use residential 2 lane road which is majority of roads in the city is much lower and frankly nobody repaves local roads every 30 years - it just not needed. In addition $100 per month per house is significant but if it's the only thing that make small town more expensive than dense city it's still does not make city that much attractive.
  - ryandrake 5y ago
    I think there is a flaw in the author's analysis: It's based on a fixed cost-per-length model. Not all roads cost the same to maintain. A downtown city street that gets heavy, continuous use will have to be repaired much more frequently than a sidewalk-less rural road that gets ten cars per day on its busiest day. City streets are also more complicated to repair, often having sewer pipes and electrical lines buried in close proximity, so are likely more costly to repair each time, too.
    - bradlys 5y ago
      Did you read what they wrote? They clearly outline the flaws and limitations of the analysis. They say it’s just an estimate.
      - joebob42 5y ago
        Right, but it doesn't seem like a very good estimate and their whole argument hinges on it.
wayoutthere 5y ago
My guess is that you live in a newer suburb where the infrastructure isn’t 100-150 years old. When your sewers, water lines, roads, municipal buildings, etc. are over a century old, you can no longer delay maintenance without cutting service levels. This is why older rural areas of the country like Appalachia are dotted with so many ghost towns; it stopped making sense to invest in those places decades ago because the infrastructure was so far gone it was just cheaper to build a new town somewhere else. Many rust belt towns are going through this right now; my mom grew up in a rural factory town in southern NY that once had a population of nearly 10,000 — 50 years later, that population is closer to 500. And still dropping because most of the lots in town are unoccupied, rotting homes left behind when previous owners died that would be torn down if there was the money to do so, but there isn’t and it drags down property values of everything in the area. Pittsburgh — a city big enough to have 3 professional sports teams — has entire neighborhoods that have been abandoned and fenced off after the population dropped by over 50% since the 1970s. Mostly so that the city doesn’t have to maintain power, sewer, water and roads in those areas because there just isn’t the money to rebuild them. There is an entire subway system under the city that has simply been abandoned due to lack of upkeep. The city is on an upward trajectory again, but property values in the city are still astonishingly low (10 years ago you could buy a livable-if-dated house in a good location for $50,000) and taxes are high.
- dougdonohoe 5y ago
  Pittsburgher here. What are you talking about? There is no abandoned subway system under Pittsburgh. What we call the 'T' is alive and well. There are also not "entire neighborhoods that have been abandoned and fenced off".
  - jeffbarr 5y ago
    Perhaps they were thinking of Rochester, New York: https://rocwiki.org/abandoned_subway https://rocwiki.org/abandoned_subway
- selimthegrim 5y ago
  New Orleans could only afford to start fixing its streets and sewers with the FEMA money after Katrina.
throwaway6734 5y ago
>Overall rural lifestyle does not cost much more than the city in infrastructure costs - and I did similar calculations for previous strongtown articles. On a feeling level it make sense that dense city should be cheaper but reality is frankly it's not. Who pays the cost to connect these rural areas to other regions?
zeckalpha 5y ago
In my inner ring suburb, the largest category of expense is policing. We spend more on police than we do on parks and roads.

300bps 5y ago

Yeah I saw his property tax of $1,600 per year and how it was already too high to raise. Tax rates of $8,000 to $20,000 are common around me.

cableshaft 5y ago
Galesburg is a declining city in the middle of nowhere. People who live there probably drive to work ~50 miles away to Peoria or Davenport/Moline every day if they don't have a (probably) low paying job in town. And if that's the case, they'd probably be better off moving closer to those cities, there's probably even cheaper homes within a shorter commute. Also it's in Illinois, which is #2 in the country for highest overall property taxes[1]. Keep in mind he said a reasonable house value just north of their downtown is $75k, where the national average price for a home is $374k (as of Q2 2021), which is 5x the price. $1600 * 5 = $8000, which brings it up to what's near you. And considering Illinois' property tax is higher than every other state other than New Jersey, I'm guessing the homes appraised value near you is likely a lot higher than $374k, even. That being said, I don't understand why the government wouldn't be able to up just the city's percentage (as opposed to all line items on the property tax bill) by about $100-200/yr per person and use that to help close the gap. The percent going to the city of Galesburg is currently a tiny percentage of the overall tax. [1]: https://www.illinoispolicy.org/illinois-again-ranks-no-2-in-u-s-for-highest-property-taxes/ https://www.illinoispolicy.org/illinois-again-ranks-no-2-in-...
- mitigating 5y ago
  People will fight against any tax raises regardless of the amount.
  - cableshaft 5y ago
    Well yes, that's one reason it probably isn't being raised. But if you could let the people know that "hey, this is going directly into fixing the roads, and your property tax will only go up $8 per month to afford it, otherwise your roads will stay shitty", I think most people could be convinced to go along with it.
    - pharke 5y ago
      It would be helpful if you could just go to a website, enter in a code from your property tax bill and see exactly how every dollar of the taxes you paid were used. This is one of the valid uses of a public ledger I can think of. In my opinion, all tax funded spending should be traceable like this with each transfer recorded and reported to the tax payer.
      - gruez 5y ago
        Doesn't checking the city's budget do the same thing? The only thing that site would add is multiply the budget amounts by your tax bill.
        pharke 5y ago
        I don't feel like that addresses the part of the comment I was speaking to: > "hey, this is going directly into fixing the roads, and your property tax will only go up $8 per month to afford it, otherwise your roads will stay shitty", I think most people could be convinced to go along with it. At a minimum, you could create a system that takes the budget and shows a percent breakdown of where your money goes. If you packaged it nicely so that you could understand it at a glance it would go a long way towards what the comment I was responding to was talking about. After looking at my city's budget, I think there is still a lot of room for improvement. For my municipality at least, it seems to be a mix of specific and extremely nebulous items. I can see that the fire department purchased several new vehicles and even the type of vehicle but the road works department just lists additions to their "fleet" and the sanitation department just lists "new vehicles". I see items for sidewalk and street repairs along with the name of the street but no indication of how much pavement was repaired or what the breakdown of labor vs materials was. I think knowing all of the details would help the public assist their representatives to correct overages and would be a bulwark against corruption. e.g. If I run a business that sells fasteners and I see that the city government is overpaying by 30% for the bolts they use to put up new street signs I could bid on the contract next time around or maybe tip off the newspaper if it's more like 200% over retail.
umvi 5y ago
Start charging $20k property tax and you'll probably accelerate the decline of Galesburg as people scramble to relocate to more affordable areas.
milesskorpen 5y ago
Absolute numbers aren't a tax rate. 1% of $2M home gets you to $20k/year easily. But the article talks about $100-200k homes; there is no way this town can have a 10-20% property tax rate.
cortesoft 5y ago
That $1600 is based a 10% tax rate, if you look at the chart. That means the whole property is only worth $16,000. Are you really suggesting they charge more every year in taxes than the house is worth?
- rdtwo 5y ago
  At the very low end there is a minimum tax regardless of property value. If you fall below a certain value you end up dragging down the community
gnopgnip 5y ago
If you live in Galesburg IL, or Jackson MI, Altoona PA, Rome NY or similar places if the property taxes were raised to 10x as much the homes would be worth literally zero. The rental income wouldn't cover the property taxes. And that is the underlying problem, when the costs are so high, collecting a "fair" or actually necessary amount of taxes has a debilitating effect on the economy

burlesona 5y ago

You are mistaking "what Cities spend on maintenance" for what it would cost to fully maintain the system. The author does a good job spelling this out: > If we convert 177 miles into feet it’s 934,560 feet of road. At $20 per foot per year, we would need to spend on average $18,691,200 a year on road maintenance just to keep all of our roads properly maintained. Note his actual estimate is ~$18.6M not the ~$4M you quoted - that was his hypothetical "even if I'm wrong by 4x too high" number. > According to the capital improvement plan from earlier we are planning to spend an average of $3,220,000 per year. Note that the author's cost figure is just for roads and does not include other similarly expensive infrastructure like water lines that are included in the city's Capital Improvements budget. The reason for this gap in infra funding is they don't have the money, so they let most of the infrastructure decay, and use the money they have to patch the worst problems as best they can. Every city in America is doing this. We just so used to it we don't think anything of driving on roads that are full of cracks and potholes and generally falling apart. This gap is why the American Society of Civil Engineers gives the US a C- on infrastructure. (https://infrastructurereportcard.org https://infrastructurereportcard.org)

tptacek 5y ago
Not that I disagree with your sentiment but the comment you're responding to observes that water lines --- the extra infrastructure beyond roads not included in the article's estimate but sort of implied as being significant --- are generally paid for by user fees, not property taxes.
- burlesona 5y ago
  I think this varies widely so any generalization needs many caveats… but I don’t think you can assume that. What I’ve usually seen is that water service, ie the cost of filtration and sewage treatment and maintaining pumps, is paid by user fees. Water infrastructure - the actual pipes - are usually considered capital projects and maintained out of different funds. But again the details vary on a subdivision by subdivision level not to mention state to state.
  - 5y ago

fredophile 5y ago

The author thinks the city needs to spend a little over $18M per year just on roads. That would be about $1200 per year per house or $100 per month. Considering that their total property taxes are currently around $1700 per year in total property taxes that's a huge increase.

dfadsadsf 5y ago
To get to 18M number, author approximated that cost of repair 3.5 lane medium use road in industrial area (aka heavy trucks) to all roads in the town which just not make sense. Cost of repair low use residential 2 lane road which is majority of roads in the city is much lower and frankly nobody repaves local roads every 30 years - it just not needed. In addition $100 per month per house is significant but if it's the only thing that make small town more expensive than dense city it's still does not make city that much attractive.
- ryandrake 5y ago
  I think there is a flaw in the author's analysis: It's based on a fixed cost-per-length model. Not all roads cost the same to maintain. A downtown city street that gets heavy, continuous use will have to be repaired much more frequently than a sidewalk-less rural road that gets ten cars per day on its busiest day. City streets are also more complicated to repair, often having sewer pipes and electrical lines buried in close proximity, so are likely more costly to repair each time, too.
  - bradlys 5y ago
    Did you read what they wrote? They clearly outline the flaws and limitations of the analysis. They say it’s just an estimate.
    - joebob42 5y ago
      Right, but it doesn't seem like a very good estimate and their whole argument hinges on it.

wayoutthere 5y ago

My guess is that you live in a newer suburb where the infrastructure isn’t 100-150 years old. When your sewers, water lines, roads, municipal buildings, etc. are over a century old, you can no longer delay maintenance without cutting service levels. This is why older rural areas of the country like Appalachia are dotted with so many ghost towns; it stopped making sense to invest in those places decades ago because the infrastructure was so far gone it was just cheaper to build a new town somewhere else. Many rust belt towns are going through this right now; my mom grew up in a rural factory town in southern NY that once had a population of nearly 10,000 — 50 years later, that population is closer to 500. And still dropping because most of the lots in town are unoccupied, rotting homes left behind when previous owners died that would be torn down if there was the money to do so, but there isn’t and it drags down property values of everything in the area. Pittsburgh — a city big enough to have 3 professional sports teams — has entire neighborhoods that have been abandoned and fenced off after the population dropped by over 50% since the 1970s. Mostly so that the city doesn’t have to maintain power, sewer, water and roads in those areas because there just isn’t the money to rebuild them. There is an entire subway system under the city that has simply been abandoned due to lack of upkeep. The city is on an upward trajectory again, but property values in the city are still astonishingly low (10 years ago you could buy a livable-if-dated house in a good location for $50,000) and taxes are high.

dougdonohoe 5y ago
Pittsburgher here. What are you talking about? There is no abandoned subway system under Pittsburgh. What we call the 'T' is alive and well. There are also not "entire neighborhoods that have been abandoned and fenced off".
- jeffbarr 5y ago
  Perhaps they were thinking of Rochester, New York: https://rocwiki.org/abandoned_subway https://rocwiki.org/abandoned_subway
selimthegrim 5y ago
New Orleans could only afford to start fixing its streets and sewers with the FEMA money after Katrina.

throwaway6734 5y ago

>Overall rural lifestyle does not cost much more than the city in infrastructure costs - and I did similar calculations for previous strongtown articles. On a feeling level it make sense that dense city should be cheaper but reality is frankly it's not. Who pays the cost to connect these rural areas to other regions?

zeckalpha 5y ago

In my inner ring suburb, the largest category of expense is policing. We spend more on police than we do on parks and roads.