City Planning Exercise

[Bunz]

The first thing that struck me is the fact that, it at least appears that, the vast majority of the residents of the area work outside the township. If you've got that many people having to drive that many miles for work, the first thing that needs to be done is to get more business's inside the township.

The stat about the commute time also surprised me. So its obvious this is a bedroom commmunity, whereas most of the residents work somewhere else. Judging from the square mileage of the town, it is quite small. I mentioned earlier than annexing some surrounding land and making that for sale or cheap development would be wise. This is assuming of course the local community wants that. It may be a town that wants to remain small, rural, and quiet. I can certainly understand that desire.

 

[Federal Farmer]

The people of Senecaville thank you!

My pleasure.

Ok, so I've condensed what you had said into 3 points. Bring back back up any you like.. Just wanted to touch on these.

Tax incentives. Since the town is so small, the budget is similarly small. Lets say the town could offer tax incentives to Either business OR to the townspeople, which would you prefer and why?

Tax incentives, in either case, would have to be dependent upon the return on investment of those tax incentives, so I see no reason why both can't be accomplished. For a business to get the tax incentive, they would have to first demonstrate that they have expanded their business and brought in new jobs (and not by simply cutting hours and hiring on more part-timers), or done something else to show that they've increased the cities tax base so that the city isn't losing money by providing the incentives.

The same for the citizens, they would have to do something in return for the incentives, like I mentioned earlier about contributing to the methane plant by recycling their lawn clippings. Another area where a city could offer incentives would be by having the citizens themselves take their own garbage to a neighborhood collection (dumpster) and recycling point rather than having to operate a large garbage pickup service. That way, the trucks go only to the central pickup points instead of having to drive all over town, which saves the city fuel, maintenance, and personnel costs.

If the city isn't going to make, or save, money off of the incentives, then they're not really incentives, but rather welfare.

 

[GenSeneca]

It may be a town that wants to remain small, rural, and quiet. I can certainly understand that desire.

Thats the premise I have started from, just basic ways to improve the quality of life and increase the towns prosperity. If this were extreme makeover, things would be easy: Build a humongous casino in the center of town.

I would like to know how the tax breaks affected your budget and what percentage of the people received the breaks. If you happen to have that information or remember it offhand, please share.

Job creation and Wal-Mart. Although you implying this would be a bad thing for the town, it might not be a bad idea. Our town has many of the human resources already trained to build, operate and maintain such a business.

While I am well versed in the complaints about minimum wage jobs, they were never meant to sustain a family on a 40 hour work week.

The majority of our towns children are in grade school, about 10 years from now they will need summer jobs and part time work. Any workers that cannot solicit, or has not earned, a raise from minimum after one year - is probably not a very good employee.

Wal Mart will even encourage our kids to go to college through their work programs... We might get a doctorate out of the deal. And a large portion of our towns population is suitable for the "Good Paying" jobs that an Ultra-Mega-Monopoly-Corporation has to offer.

Minimizing Zoning laws. This is an excellent subject! The town is pretty well squeezed into its boundaries so we can change the zoning ordinance, but only within those boundaries. We can only rezone and build on property thats not in conflict with neighboring district zoning laws, so there must be buffer zones. These zones are in place and until the neighboring zones change, they have to remain. This leaves us with, like I said, pretty little room to operate.
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Fed, you make some very good points on the purpose of tax incentives. Lets look at a different direction. We'll say the population of our town is taxed 1% of their earnings - on top of state and federal. What could we do to replace that system with the Fair Tax and would it work at such a local level?
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Thanks fellas, look forward to hearing more from both of you!

Invitation is still open for others to join.

 

[Federal Farmer]

Fed, you make some very good points on the purpose of tax incentives. Lets look at a different direction. We'll say the population of our town is taxed 1% of their earnings - on top of state and federal. What could we do to replace that system with the Fair Tax and would it work at such a local level?
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Thanks fellas, look forward to hearing more from both of you!

Simply do away with the 1% "illegal local income tax" and replace it with a 1% sales tax (fuel would be exempted). The revenue garnered from a sales tax will always bring in more than an income tax (and the locals aren't quite as likely to lynch you). I'd almost be willing to bet you hard money that if you offered the citizens of a town a swap from an income tax to a sales tax, they'd jump all over it, especially if you threw in a guaranteed "no sales tax hike" for 10 years.

Glad to help out.

 

[GenSeneca]

Simply do away with the 1% "illegal local income tax" and replace it with a 1% sales tax (fuel would be exempted). The revenue garnered from a sales tax will always bring in more than an income tax (and the locals aren't quite as likely to lynch you). I'd almost be willing to bet you hard money that if you offered the citizens of a town a swap from an income tax to a sales tax, they'd jump all over it, especially if you threw in a guaranteed "no sales tax hike" for 10 years.

Would there be a need for prebates? If not, at what % would the prebates have to take form to prevent hardship?

 

[Federal Farmer]

Would there be a need for prebates? If not, at what % would the prebates have to take form to prevent hardship?

No, at 1%, the sales tax simply replaces the income tax. In order for their to be a prebate situation, the FairTax would have to be at least at a state-wide level. If the state were to institute a FairTax, then there would be a need for a prebate.

EDIT: BTW, are you serious about a local income tax? If anyone tried something like that down here, they'd be lynched before the sun came up again!

 

[GenSeneca]

No, at 1%, the sales tax simply replaces the income tax. In order for their to be a prebate situation, the FairTax would have to be at least at a state-wide level. If the state were to institute a FairTax, then there would be a need for a prebate.

EDIT: BTW, are you serious about a local income tax? If anyone tried something like that down here, they'd be lynched before the sun came up again!

In the town I actually live in, its 1.5%.... I can write off up to 1% of what was withheld from the locality in which my business is located - that way they can be sure you owe some money.

On the Fair Tax... Senecaville is the town level. One level up from that is the county level - Guernsey county. Can the counties also switch to the Fair tax without doing a prebate? If so, it would be possible to switch all 88 Ohio counties to the Fair Tax without bringing it to the state level and requiring prebates.

I think I like the fair tax a great deal more on the local level. This is very informing, thanks!

 

[Federal Farmer]

In the town I actually live in, its 1.5%.... I can write off up to 1% of what was withheld from the locality in which my business is located - that way they can be sure you owe some money.

OK, let me be clear, is this a personal income tax, or a business tax?

On the Fair Tax... Senecaville is the town level. One level up from that is the county level - Guernsey county. Can the counties also switch to the Fair tax without doing a prebate? If so, it would be possible to switch all 88 Ohio counties to the Fair Tax without bringing it to the state level and requiring prebates.

I think I like the fair tax a great deal more on the local level. This is very informing, thanks!

I see you're still hung up on the prebate. OK, let me do it this way, exactly what part of the prebate untaxing the basic necessities of life gives you the most heartburn. Would you rather they had to hire a bunch of people to come up with a specific list of things that are not going to be taxed, and then have all of the businesses have to hire someone to program all of that into their scanners?

I'm not trying to be an a$$ about this, it's just that you're the first person I've ever come across who had any heartburn about the prebate, and, frankly, I'm confused.

 

[GenSeneca]

OK, let me be clear, is this a personal income tax, or a business tax?

Personal income tax in the town I live in is 1.5%
I work outside that town and the local municipality withholdings there are 1%
I can write off the 1% but still owe .5% to local government where I live each year.

I see you're still hung up on the prebate... you're the first person I've ever come across who had any heartburn about the prebate

Just need to understand where the lines are drawn. Replacing a 1% Income Tax with a 1% Sales tax would require no prebate. However, Replacing a 30% income tax with a 30% sales tax would require a prebate.... Where does the prebate % start? 2%,5%,10%....

 

[Bunz]

I would like to know how the tax breaks affected your budget and what percentage of the people received the breaks. If you happen to have that information or remember it offhand, please share.

Well it has been minimal, for a few reasons. Namely, because the exemption came after a single windmill was constructed. Plus the other private generators were lumped into ones real property assessment. So what we did was shift all of that under personal property, and made those devices exempt along with quite a few other things from being included on the tax assessments. This does not mean that they cant be taxed later, but for now and the forseeable future it will remain that way. Since then a few other windmills have been constructed and there is rumors of more.

Job creation and Wal-Mart. Although you implying this would be a bad thing for the town, it might not be a bad idea. Our town has many of the human resources already trained to build, operate and maintain such a business.

I know where you are going with your arguments, I dont disagree very much, its just that not all jobs and job creation is equal as I said earlier. My community is a fishing town(salmon capital of the world). So we are reliant on the salmon runs for the entire existence of the community. It is focused as a seasonal industry with lots of people who come from elsewhere to fish here.

Minimizing Zoning laws. This is an excellent subject! The town is pretty well squeezed into its boundaries so we can change the zoning ordinance, but only within those boundaries. We can only rezone and build on property thats not in conflict with neighboring district zoning laws, so there must be buffer zones. These zones are in place and until the neighboring zones change, they have to remain. This leaves us with, like I said, pretty little room to operate.

I mention zoning laws because there are quite applicable elsewhere. We have an absolute minimum of them in my community. Other places are quite strict. My concerns stems mostly from neighbors who might view a windmill as an eyesore and complain and turn a neighborly issue into a litigious one.

Fed, you make some very good points on the purpose of tax incentives. Lets look at a different direction. We'll say the population of our town is taxed 1% of their earnings - on top of state and federal. What could we do to replace that system with the Fair Tax and would it work at such a local level?
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Thanks fellas, look forward to hearing more from both of you!

Invitation is still open for others to join.

In my town we have a variety of local revenue sources. We have a %6 sales tax on all goods except alcohol. We have %10 alcohol and transient lodging tax(we call it the booze and bed tax), then our mill rate is 13 and we have a raw fish tax. The raw fish revenue is actually passed down from the state government as a percentage they collect that reflects how much value the raw fish processed in my community has.
I am one who thinks, that government revenue should be diversified through various means. On the local level this would mean property and sales taxes in combination, so in theory everyone pays thier fair share whether they own property or not.
This is actually a hot button issue in my community due to the large amount of privately owned non-taxable land in the form of native allotments.

 

[Federal Farmer]

Personal income tax in the town I live in is 1.5%
I work outside that town and the local municipality withholdings there are 1%
I can write off the 1% but still owe .5% to local government where I live each year.

MOVE IMMEDIATELY! There is no way I'd live in a city that charged it's citizens an income tax on top of property taxes, and sales taxes.

Just need to understand where the lines are drawn. Replacing a 1% Income Tax with a 1% Sales tax would require no prebate. However, Replacing a 30% income tax with a 30% sales tax would require a prebate.... Where does the prebate % start? 2%,5%,10%....

They're not replacing a 30% income tax with a 30% sales tax, they're replacing a variable rate, inequitable, too many ways to dodge it, income tax with a 23% inclusive sales tax. The prebate was calculated on the amount of taxes, up to the poverty level, that someone would spend on the "basic necessities of life", and they receive that amount, in advance, to offset those taxes, regardless of ones income level. A married billionaire with 2 kids receives the same amount as a married laborer with 2 kids who makes $10 an hour.

It is possible to calculate the amount of a prebate that would be "fair" even for a 1% income tax, but I really don't have the time to do it right now.

 

[GenSeneca]

Well it seems the tax breaks are agreed to - unless there is further comment - and we shall make that our first order of legislative business... I'll get the bean counters started on an outline with the details while continue to look at other options.

everyone pays thier fair share

Sorry, not really on topic... and I'm not implying anything about your idea of fair but - I don't equate "fair" with: People who can afford it. To me, fair means everybody pays, including the poor. (and fed, I do like that about the Fair tax)

MOVE IMMEDIATELY!

Once we get a plan for Senecaville, I'll move there and run for council.... What a great name for a town.

they're replacing a variable rate..with a 23% inclusive sales tax.

I just used 30% as an average for the variable rate... although its probably much higher I rounded down to an even number. And 23% fed + 5.5% state (28.5), I rounded up and called it 30.
It was not my intention to misrepresent the Fair Tax but I was trying to oversimplify it, in order to better understand using it at the 1% micro-level.

It is possible to calculate the amount of a prebate

Thats really not necessary, but thank you. I'm just curious as to a ballpark % figure of when prebates would become necessary.

The 1% Income tax can easily be replaced by a 1% Sales but the State Sales tax is already at 5.5% so our town ends up with a 6.5% sales tax as a result.
Now if we also replace the property tax with a % sales tax, the total sales tax on items in our county would likely be at or above 8%.

Does this help explain my question about at what % we need to worry about prebates?
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OK, so I was going over our plans with the town mayor and he loves the recommendations that are coming out of this exercise. He especially liked the Tax Incentive Program for alternatives and the idea for implementing the Fair Tax on the town level. I should let you know that Senecaville has no mayor, at least until I move.

 

[BigRob]

I was reading up on what this town has to offer. Here are my opinions:

1) Why the focus on alternative energy? The town cannot afford it and it really brings nothing to the town.

2) The majority of people in the town do not attend any form of college. Would there be any way to fund the educations of the top performing children in the high school provided that they come back and work in the town for the amount of time that it takes them to complete college? (4 years)

3) There are no jobs in the town. Looking at many people's commute times, the majority work elsewhere. You will have to come up with some plan to bring any form of business to town. Should you be able to generate more highly educated workers who work in the town, business will have a better workforce to draw from.

4) Property values in the town are very low. Use the lake to develop resort attractions that will bring in extra money. Give business a tax break for hiring within the local population to keep them there and keep them working there.

These are just a few of my initial thoughts.

 

[GenSeneca]

This was one of my first posts here and remains one of my favorite threads.... Ah, memories.

P.S. What a great name for a town.