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0 pointsmaxsilver7y ago0 comments

I'll break this down another way.

I'm going to pick a random suburb that happens to be near me. They are about a 33% even split of old suburbs (1940-1960s), middle suburbs (1970s-1990s) and new suburbs (2000s+), with maybe 15% of that new suburb land still totally empty. There are a few duplexes and apartment buildings in there, but nothing dense. No buildings higher than 3 stories, it's like 95% low density stuff.

Their budget for 2017 includes $7,143,000 towards "Major Streets and Local Streets". That's costs for basically every road except the freeways (those are maintained by the state). This suburbs spends that, every year, on roads alone.

"OH MY GOD THATS SO EXPENSIVE" says StrongTowns, "OBVIOUSLY SUBURBS ARE DOOMED!"

There are 75,000 people living in this suburb. That 7 million dollars, divided per person (per capita) per month, comes out to $8/month per person. (That's number is artificially high, because it includes none of the businesses or retail that also pay taxes -- it assumes just the residents alone shoulder all the burden).

Even ignoring all business revenue, for less than the cost of a Netflix subscription per person, this suburbs maintains every single street in the entire suburb.

An average house in this Midwestern Michigan suburb, costs about $150-200k. A single family home pays a couple hundred dollars per month in property taxes. It costs just $8 of those couple hundred dollars per month, to maintain every single street in the suburb.

Is it possible the municipality mis-counted something? Sure! Is it possible they aren't fully accounting for every possible road cost? Perhaps! Let's pretend they mis-counted by something extreme, let's assume they are a full 50% under-estimating on literally every street in the sububrb.

That doomsday scenario means a citizen might have to pay $16/month for roads, instead of $8. Oh no, what a terrible world that would be

I'm not pretending every suburb is identical. I'm sure there are suburbs that spend more than $8/per person per month on roads. Some suburbs are more sprawled out than others. But generally speaking, there is no great infrastructure apocalypse coming down upon us. It's just not happening, unless some major disaster wipes everything out all at once (like a hurricane, or a tornado, or a screwup like Flint's Water crisis).

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The Growth Ponzi scheme makes a great headline for StrongTowns. But for most people, it's completely fanfaction. It is not grounded in any reality whatsoever, for the vast majority of people who are reading it.

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4 comments · 2 top-level

Karrot_Kream7y ago· 2 in thread

> There are 75,000 people living in this suburb. That 7 million dollars, divided per person (per capita) per month, comes out to $8/month per person. (That's number is artificially high, because it includes none of the businesses or retail that also pay taxes -- it assumes just the residents alone shoulder all the burden).

Are you assuming that each of those 75,000 people owns property and pays property tax? That is a pretty inaccurate statement.

Moreover I too will engage in your random exercise. Let's pick Paso Robles, CA [1]. Rather than guestimating property taxes based on some weird anecdotal extension of my own property tax, I'm going to take a look at the city budget [2]. The city earned $10,370,327 in property taxes in the 2017 FY. The city paid $1,258,730 to maintain its streets in the same FY. That's 12.1% of property taxes devoted just to street maintenance. In fact, if you look at the city budget, property tax can barely pay for the public works of the city. Without other sources of revenue, the city would fall woefully behind on its payments.

[1]: https://en.wikipedia.org/wiki/Paso_Robles,_California

[2]: https://www.prcity.com/DocumentCenter/View/23619/Two-Year-Ad...

maxsilverOP7y ago

> Are you assuming that each of those 75,000 people pays property tax?

Yes, because effectively, they are. Renters pay for it through their rent (landlords don't just eat costs for free) and obviously children don't pay for their own, and homeless folks don't and such. But effectively, most every resident is paying property taxes (or someone is paying their share for them) in some way or another.

> I too will engage in your random exercise. Let's pick Paso Robles, CA

So, using your approach for the suburb I picked, all road construction + maintenance + repair costs are about 20% of the total suburban budget. Approximately $8/person/month. (This is in Michigan, where we have snow+ice+flooding for 6 months straight each year, so that seems totally reasonable to me.)

Using your own link for Paso Robles to the budget they provided, they're devoting 12.1% of property taxes to street maintenance. With ~29k people, that's ~$4/person/month.

So, your suburb spends even less to maintain their roads (per capita) than mine does. Isn't that a good thing? Doesn't that just further reinforce the fact that there is no coming "infrastructure apocalypse" for roads? If Paso Robles needed to double their entire road budget for some magical reason, you'd still be paying less than what folks up here already pay every single year.

> In fact, if you look at the city budget, property tax can barely pay for the public works of the city. Without other sources of revenue, the city would fall woefully behind on its payments.

Isn't that also a good thing? In a perfect world, the total taxes collected would pay for all the services provided, with a little set aside for a rainy day and nothing more left over.

Karrot_Kream7y ago

> Yes, because effectively, they are. Renters pay for it through their rent (landlords don't just eat costs for free) and obviously children don't pay for their own, and homeless folks don't and such. But effectively, most every resident is paying property taxes (or someone is paying their share for them) in some way or another.

I think this is a weak argument you're using to make the price per capita seem low. If your income is $10 / mo, and you pay $4 in property tax, then you are spending 40% of your income in property tax.

> Using your own link for Paso Robles to the budget they provided, they're devoting 12.1% of property taxes to street maintenance. With ~29k people, that's ~$4/person/month.

That's still 12.1%. Whether it's $4/person/month or $1/person/month, it's 12.1% of property tax.

> If Paso Robles needed to double their entire road budget for some magical reason, you'd still be paying less than what folks up here already pay every single year

Again, how does that matter? The city will now be paying 24.2% of their property tax on road maintenance, leaving a shortfall.

> Isn't that also a good thing? In a perfect world, the total taxes collected would pay for all the services provided, with a little set aside for a rainy day and nothing more left over.

Right but what about emergency services, and city vehicle fleet maintenance, and sewage, and parks... The property tax cannot pay for all services associated with the sprawl. Oh and building new infrastructure. The city relies on a bevy of other taxes and entitlements to pay their budget, including various State transportation subsidies.

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azeotropic7y ago

The obvious reason that property tax collections 'just barely' manage to pay for public works is that citizens set the rate of both taxation and expenditures (taking into account the availability of state and federal funds). They're not broke, they could raise the tax rate, they just don't want to.

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