> The median house in Lafayette costs roughly $150,000. A family living in this house would currently pay about $1,500 per year in taxes to the local government of which 10%, approximately $150, goes to maintenance of infrastructure [...] To maintain just the roads and drainage systems that have already been built, the family in that median house would need to have their taxes increase by $3,300 per year.
As best I can tell, the author was saying that Lafayette is spending only $150 / ($3300 + $150) =~ 4% of what it needs to spend to maintain its roads and drainage systems. That seems implausible. I wonder whether he has made an odd assumption: "currently, 10% of taxes go to maintenance of infrastructure; thus, if we increase taxes by $3,300, only 10% of the increase will go to maintenance of infrastructure." That odd reasoning might account for his "need to have their taxes increase by $3,300 per year" claim.
It can happend when towns grow quickly and the city sell the parcels for a significant amount of money.
In Denmark parcels are often sold for $50-100.000 in popular areas. This gives the town a significant amount of one-shot money.
If they use that one-shot money for running expenses rather than investments (in e.g. subways), then the town will go bankrupt when there are no new buyers of parcels.
> If they use that one-shot money for running expenses rather than investments (in e.g. subways), then the town will go bankrupt when there are no new buyers of parcels.
This is what happened to Mississauga, Canada (a suburb of Toronto): for the last fifty years builders had to pay developer charges which was used to build the initial infrastructure.
However things were constructed in a typical North American, car-centric fashion. Now that most of the available land is covered in large-plot, low-density housing, they kind of realized the money train has reached its destination and they now have to maintain all of this infrastructure.
The same mayor (Hazel McCallion) was re-elected over and over for forty years, and so the same kind of thinking was perpetuated over that time period because no fresh thinking was introduced and things basically ran on inertia. She is often labelled the "Queen of Sprawl".
There are of course some plots left, and over the past few years they've been building medium-density townhomes, as well as more and more mid- and high-rise towers.
I'm from Germany, 50k seems pretty low for a plot of land. You already pay more like 100k already in the countryside. And then the commune doesn't really make a profit (if they didn't own the land beforehand).
Land is more expensive in Europe, that's a fact; EEA[1] has more than 500 million people for a size half of the USA, and as much relief and less plains: Scandinavia is just a big mountain, the Alps severely limit the possibility of cheap transportation in the middle of it, and UK the main economic powerhouse with Germany and France is an island not even connected to the continent where 50% of everything is around London. Also not enough waterways rely the economic regions apart from around Germany. Yeah subway and infrastructure cost less but everything else is costlier.
Scandinavia as a whole is not a big mountain. Did you mean Norway? B/C Sweden only has some mountains in the sparsely uninhabited borderlands and Denmark + Finland are basically flat.
FWIW the UK is connected via a rail tunnel to France. But most goods are transported via cargo ship and most people via planes, so how much does it really matter?
Furthermore, the US might have more land but they also have other challenges that Europe doesn't have, such as huge cities in dessert area, tornadoes, and no internal waterways from east to west (need the panama canal).
There's pro's and con's to the land on both sides of the Atlantic. But it seems far from a decisive factor in the wealth of our nations.
It‘s not as meaningless as it seems. Parcel sizes are very similar in similar areas: smaller in cities accommodating row houses and larger in the land planned for single or double family homes with a garden. There are some outliers, but usually you will only find very similar plot sizes in one area.
He's talking about accruals based accounting. I'm no accountant, but memory suggests that means adding something similar to [cost of asset / life of asset] to the annual maintenance cost.
Although it is still implausible, it is certainly possible to miss 95% of the cost if they spend very little on monthly maintenance (ie, under-maintain). Then at some point in the near future, the road will need to be ripped up and replaced. Not cheap.
A lot worser. Years long the mobile-posse shouted: 'The roads are runned-down, off! We want you (the Gov) to repair'em!'. And the time came when the government started some infrastructure-programs repairing bridges and -roads (also railroads), but the people were 'unthankful' shouting: 'Now it takes a lot more time to [Insert:Object]-[1]. Under construction...everywhere! we do not like it!', 'Do something!' And a lot more happend to "home" (-;
[1]-[Object.List]: get home; to work, to the shopping center, the Kindergarden, bring the kids to school, find a parking lot... get our everyday stuff done. ^^
The article said about 10% of taxes goes to maintenance of infrastructure. I'm fairly sure that percentage is fixed.
That would be $150 + $330=$480 not $3,450.
That would make the current percentage 150/(330+150) = ~31% not ~4%.
The percentage is fixed in the context of the discussion about why a $3,300 tax is needed on top of an existing $1,500 tax. This is not a discussion about how the rate of use of tax for infrastructure can change.
if you assume tax revenue is spread amongst all the things that are needed, then this makes sense. Instead of X number of things getting fully funded, and then roads/sewer maintenance getting a pittance, everything is under funded to the same degree, but everything still gets a little bit of funding.
As best I can tell, the author was saying that Lafayette is spending only $150 / ($3300 + $150) =~ 4% of what it needs to spend to maintain its roads and drainage systems. That seems implausible. I wonder whether he has made an odd assumption: "currently, 10% of taxes go to maintenance of infrastructure; thus, if we increase taxes by $3,300, only 10% of the increase will go to maintenance of infrastructure." That odd reasoning might account for his "need to have their taxes increase by $3,300 per year" claim.