by Win Wenger, Ph.D.
Winsights No. 31 (July 1999)
Wipe out most taxes in New York City…Sounds too good to be true, doesn’t it? Especially when we also throw in, “—and substantially reduce city debt—at the same time!”
Bear with me, and see what you think a few paragraphs from now.
An Unused Asset
Elevated train tracks and road-artery overpasses go on for miles through some of the most expensive real estate in the world…
What would you say is the dollar value of a few hundred thousand square feet, ground-level, in Manhattan? Throw in some of the same unclaimed value in Brooklyn, Queens, and other neighboring boroughs, and we are looking at more than a million square feet of groundspace, municipally owned, which presently are unclaimed and neglected—and which are a source for crime, and a drag on property values, and an even bigger drag on the tax base!
- With nothing under them but rotting concrete, empty space, abandoned cars and trash.
- Much or most of that space ideal (except for road noise) for small retail shops and even pocket malls or strip malls, tucked under those elevated roadways and tracks.
Spare the ears!
For many decades we’ve known how to build spaces and insulate them from external noise, to say nothing of insulating them from showers of sparks from overhead passing trains. For less than 10% higher physical cost of building a facility, these new shops could be made the quietest locations in Manhattan!—turning this unused space into cash, to knock down taxes and debt while paying for improved city services.
Immediate gains
| Sell off leases—10-year, 20-year, 49-year—to the highest bidders who will build in compliance with the necessary codes. |
That’s the city’s immediate income. Special building codes are needed with these areas, to assure insulation from noise and vibration, and for security arrangements to counter present high rates of crime in these neglected areas. And to ensure a quality which will make these areas truly an economic asset to the city for the long haul. And to ensure there is no compromise of traffic on those road arteries and elevated trains.
| Sell off this vast supply of spaces just a modest portion at a time, so that at any given time these available spaces aren’t in oversupply to drag down market prices, and that the city realizes fair and full market value for these spaces. |
The city can, by direct leasing of these neglected and wasted empty spaces, realize a huge input to its treasury every year for 10 to 20 years. It will still own these by then richly income-producing spaces thereafter—with a lot of options open to the city for how best to play those continuing assets.
Longer-run gains
- Direct: A substantial increase in the city’s tax base, further lightening the load on individual taxpayers. And a reduction in crime costs as these crime-ridden wastelands become tidy modern shops.
- Indirect: Through lower taxes, lower crime, a more inviting physical plant, a yet greater convenience of shopping options, and improvement in city services for some of the invested budget surplus…
…the city becomes a far more attractive place to invest, work, live, with a further, and very considerable, expansion of the tax base and further lightening of the individual tax-payer load.
Essentially, everyone winning, only petty crime losing.—All gains. The only costs are borne by the free market, which wouldn’t be making those lease-and-building deals if it wasn’t well worth its while. The public treasury for once, wonder of wonders, faces no cost, only gains.
Action
Maybe politics is a disease of the mind, which prevents candidates from seeing solutions, only problems to exploit because unhappy, dissatisfied people are more active than the satisfied. But surely some candidate, somewhere in the political jungles, might see opportunity in this unique win/win/win/win situation and rise to stop the present continuing hemorrhage of losses!
If you live near New York or similar great cities and so have stakes affected, or if you have a friend in the area and so have some human stakes therein, please bring this remarkably obvious solution and brief to the attention of at least two other people. Thank you.