Free land will always be a draw. Or so Beatrice hopes. Ever since the Homestead Act of 1862, Beatrice, Neb., has provided land to farmers looking to scratch out a living. Times were simpler then. Now small towns like Beatrice have formed their own Homestead Act of 2010 in order to dole out land to reap the benefits of real estate tax revenue. Public parks and similar non-tax revenue generating properties aren’t what towns like Beatrice, Neb., need anymore, writes the New York Times.
It’s what the small towns are doing
Budget deficits haunt more of small town America than ever, according to the Times. Even supposedly rich resort retirement towns like Boca Raton are feeling the pinch. Giving away land or charging even a small fee help with a lot of city costs, including all the lawn maintenance fees public lands require. Higher populations may increase the cost of services, but Beatrice, Neb., believes the property tax will handle those costs.
Is taxing the nonprofits next?
Small towns the likes of Manchester, N.H., and Concord, Mass., are one step away from introducing the tax man to their nonprofits. The budget shortfall has to be made up in some way. Fifteen percent of Concord’s real estate is made up of tax-free structures. Will there be a tipping point, when tax-exempt parties will be required to pay taxes to aid their communities? Private schools, churches and charities provide value in the minds of many, but they have generally been free of taxation.
Beatrice welcomes homesteaders once more
Where the homestead act began is where it shall be revived. There needs to be a driver behind this tax revenue movement, particularly if things are as grim as the National League of Cities’ recent study makes them sound. The NLC study found that property tax, sales tax and state aid will experience deficits of $55 billion to $85 billion by 2012. Such shortages will demand action. The tax benefit is there if more people are brought in, and building new and improved homes would also raise property values.
Making sense of the dollars
Vocal critics wonder if a city should have the power to give out free land to any “nontaxpaying outsider who asks.” But perhaps the more persuasive stance comes from one town mayor, who asked the Times, “What’s the value of a lot to us if it’s empty?” Harsh realities often require direct solutions.
New York Times: http://www.nytimes.com/2010/07/26/us/26revenue.html?_r=2&hp
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