My letter to the local public media news publishers abridged@kvie.org
Hello,
I read your story about the financial troubles local governments have been facing lately. You have a few significant omissions.
For
example, there's a loophole in Prop 13 for commercial property that
costs the state an estimated $12 billion annually. Prop 15 was narrowly
defeated when it attempted to close the loophole. Did local politicians
lobby for passage? Not that I could detect.
Then there's all the land speculation that could have served the public, but largely ends up in private coffers.
Speculators
bought, or more likely optioned, North Natomas farmland for roughly $2K
per acre. It was cheap because it was 20' underwater ag land surrounded
by weak levees. It was so unsuited for development that a federal grant
to expand capacity included a $6 million penalty if local governments
used that capacity to serve the North Natomas development.
The
speculators went all the way to then-vice-president George Herbert
Walker Bush and got that prohibitive, up-front penalty transformed into a
pay-as-you-develop fee...oh yes, and they got $43 million to improve
the levees to pre-Katrina standards.
After
getting the entitlements to develop, they sold those acres to builders.
Winncrest homes bought at $200K / acre. If your calculator isn't handy,
that's a 10,000% (gross) profit...and I promise you that's after tax if they exchange out of the purchase.
Germany
requires developers to sell outlying ag land to the local government at
the ag land price, then repurchase it at the development land price.
All that egregious profit inures to public benefit. And they have
terrific benefits, including single-payer healthcare, excellent
infrastructure, and free college tuition. The arts budget for the City
of Berlin exceeds the National Endowment for the Arts for the US of A.
Finally,
you didn't mention that sprawl is a Ponzi scheme. Outlying development
is roughly twice as expensive to maintain as infill. So has that stopped
the locals from approving more and more edge-city development? Nope.
All you're doing is documenting the fact that those maintenance costs are finally catching up to the locals.
--Yours truly,
--Mark Dempsey
