Raise the Hammer

Yes making the $10000 upgrade in a Burlington home would save the owner $55 a year on property tax compared to another who made the same upgrade here. But that doesn't account for the fact that the original price of the Burlington house was much higher (assuming both houses are the same) and thus that $55/year in savings is negated by the higher mortgage payment and/or down payment made to buy it. People who care about and take pride in their homes will always make the upgrade if it improves their quality of life, people aren't all machines whose sole mode of reasoning is through a balance sheet. I can't imagine anyone not upgrading a leaky bathroom or drafty windows just to save a few dollars a month on their tax bill.

"Hamilton and Burlington have similar levels of public services and yet more people would rather live in Burlington than Hamilton. How do you account for this?"

I won't make any claims as to why any body does anything because human interactions are too complex to simulate with only a few variables. Some people may be attracted to low tax rates but that is only one of many factors people would consider.

"Even if that's the case, so what. Property values reflect consumer demand for living in a community, so if property values rise when tax rates are dropped, it shows that people actually want lower taxes and not more government services. "

You're missing (or maybe choosing to not acknowledge) my point, if we dropped taxes then the city would face an immediate drop in revenue but property values would not immediately rise to offset the drop. Perhaps they would eventually rise as people moved in but if it takes too long the city would be faced with an increasing budget shortfall leading to reduced services which would actually drive down prices.

This is the last comment I'll be making on this topic, I allowed myself to get involved in another A Smith vs the World thread and I'm getting out now before it gets worse. What aggravates me most is that I don't necessarily disagree with you A Smith. Lowering tax rates is one tool local governments can use to attract new comers but it is not a magic bullet to cure all of Hamilton's problems. Any drop must be done carefully to avoid bankrupting the city while we wait for the new Hamiltonians to come.