Comment 27906

By A Smith (anonymous) | Posted December 15, 2008 at 12:27:04

Unreal, I'm not arguing the obvious fact that city employees need to eat lunch, but there is a limit to how far city employees can revitalize an area. Do city employees stay around after work and frequent the stores, restaurants, bars and alike? Do city employees clamour for housing in the area? I'm not so sure.

Vibrant downtown's simply aren't based on government offices, but are driven by the private sector. The fact that people look to government for help in revitalizing an area, speaks to the complete lack of interest from people with disposable income. All the shifting of government money will not change the fact that the downtown needs to be subsidized in the first place.

Why not do something really easy and drop property taxes in the area? Since people make decisions based on incentives, lowering the tax burden for property owners will make it more attractive to live and work in the area, all things being equal.

I guarantee you that if this happened, you would see much more organic development take place in the downtown, both for residential and business properties. All you have to do is look at the recent experience in Toronto and their land transfer tax, to see how changing incentives can affect housing demand. In Toronto's case, single family home sales have dropped 16% compared to surrounding areas and home prices have dropped 1.5%, again relative to surrounding communities.

What the downtown needs, is less government and more entrepreneurs.
Lowering tax rates would be a great first step.

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