Small Cities' Tax Systems Kowtow To Developers

Through reliance on tax revenue and tax increment financing (TIF) projects, small cities must attract developers to sustain themselves, according to this op-ed.

"St. Louis suburbanites must love local government; they've created so much of it. With 91 municipalities in St. Louis County alone, you can hardly walk to the mailbox without bumping into an alderman.

But the close-to-home benefits of tiny communities come with big problems. A town of 5,000 enjoys no economies of scale in running a police force, managing road crews or maintaining parks. And shifts in the regional economy can strip towns of sales tax revenue as businesses close and shoppers flock to a glitzy new mall one town over. Hazelwood, Rock Hill, Jennings and Maplewood have felt such woes in recent years."

"Towns prostrate themselves at the feet of developers, offering property tax breaks to lure retail enclaves that will swipe sales tax revenue from all the towns around it."

Full Story: Sense in suburbia


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