These are rough policy concepts that we will discuss and refine as we learn more about the challenges facing the broad diversity of communities across the state. Do you have thoughts on how these or other state policies could help your community become more financially resilient? Share your thoughts via ideas@StrongWA.org.
Tax Shifts to nurture Productive Places
As Strong Towns founder Charles Marohn notes in their Curbside Chat, "The primary determinant of the future prosperity for cities will be the ability of local leaders to transform their communities."
However, limits on property taxes force cities and towns in WA to compete with each other for sales tax revenue, while also removing economic incentives to nurture "strong towns." These distorted state policies prompt local elected officials to lure big-but-fragile projects rather than nurture financially productive communities with human-scale streets. How so?
Cities and towns compete for high-revenue retailers that will:
pull customers to drive from beyond their borders to make big purchases, competing for revenue with neighboring cities,
increase out-of-area vehicular traffic,
inhibit viability of local businesses, and
dilute opportunities for neighbors to connect.
Cities and towns receive no greater revenue by cultivating productive buildings and development patterns due to the 1% Levy Increase Limit, which also suppresses revenue well below inflation.
...and then, as a last gasp to balance the budget and avoid choosing between abandoning critical services and infrastructure...
Cities and towns routinely beg their citizens to approve more taxes, designating a set of projects or services which they anticipate a majority of their voters will support.
The state needs to stop forcing our cities and towns into financially fragility.
We need the WA legislature to structure local revenue that nurtures long-term productive resiliency while nurturing productive places for people.
What kind of local revenue model would do this? Here's what we're thinking...
Redistribute sales tax revenue. Instead of sales tax benefiting the place that collects the tax, distribute it to the places where people reside, based on the population of each community. This stops inter-local competition for sales tax dollars and encourages cities to nurture great places for people. (Local option sales taxes would need to be carefully addressed so that cities with these can fulfill existing obligations funded by this revenue. Beyond this, we may consider reducing or eliminating sales tax, either generally or specifically to improve the economic viability of reusing and repairing goods, or substituting imported goods with local goods/services.)
Remove the 1% Levy Increase Limit for cities and towns. This would create an incentive for cities and towns to support the development of productive places that people value most, as cities would be financially rewarded for making their town more valuable. Local elected officials would become more accountable for the fiscal policies they support in their city.
Allow taxes on land improvements to be reduced in exchange for greater tax on land value. This encourages land owners to make the best use of their land.
Tree Canopy Market
More ideas to come...
Here are some more concepts that we've discussed and plan to write about in the future...
Curbing harmful infrastructure subsidies.
Keeping us moving:
congestion point tolls at surface street chokepoints.
reduce surface street congestion by replacing on-ramp metering with on-ramp reservations
keep buses moving reliably by legalizing 'yield-to-bus' enforcement cameras
Fixing the State Environmental Protection Act and regional growth policies to unleash infill growth near high-capacity infrastructure.
Water rights: a balancing act for people, nature, and agriculture.