Dayton Grassroots Daily Show v23 Taxing non-profits & students

Inspired by a story in the New York Times about a “Fair Share Tax” about to be enacted in Pittsburgh to tax student tuition, Greg Hunter and David Esrati discuss what this means to Dayton.

From the New York Times:

On Wednesday, the City Council is expected to give preliminary approval to Mayor Luke Ravenstahl’s proposal for a 1 percent tuition tax on students attending college in Pittsburgh, which he says will raise $16.2 million in annual revenue that is needed to pay pensions for retired city employees. Final Council action will be on Monday.

The tax would be the first of its kind in the nation, and other cities are watching closely as they try to find ways to close their own budget gaps…

The tax, which will most likely end up in the courts, represents a turning point for Pittsburgh, which has remade itself after the steel mills shut down, becoming a hub for nonprofit hospitals and universities. Yet it has been unable to draw significant revenue from its new identity.

“It’s really a disappointment that we’re in this situation,” Mayor Ravenstahl said. “Our colleges and universities are giving less and less while they increase tuition and executive pay and expand their campuses, removing high-value land from the tax rolls. The cost to provide public safety and public works services continues to increase, but our revenue continues to decrease.”

via Pittsburgh Sets Vote on Adding Tax on Tuition – NYTimes.com.

With Dayton relying on “Meds, Eds and Feds”- none of which pay property taxes, is it time to reexamine the waivers on property taxes for non-profits?

Your thoughts?

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18 Responses

  1. mcohio December 16, 2009 / 11:38 am
    Very good discussion with an exception to one point. You speak to UD’s, Good Sam and Miami Valley Hospitals expansion as a land grab without payment of any property taxes. This would be a more valid point if Dayton was “built out”. There is so much land available for development and redevelopment that the expansion of the aforementioned not for profits haven’t caused even a ripple in land costs.
    This could be a valid point if developers (for for profit entities) were having trouble finding suitable locations for business. I can think of no for profit venture that was derailed because of the expansion of an Ed, Fed or Med organization. Dayton Daily’s planned expansion, Caresource’s expansion and any others in the city have not been affected by the growing non profit community.
    A case could be made for UD that they have reduced crime in their vicinity, caused property values to increase in neighboring areas and contributed greatly to local sales tax revenues by increasing student enrollment and housing. UD is hardly a burden on the city of Dayton.
    I challenge you to weigh the value of the economic engine powered by Dayton’s non profits, eds, meds, feds and arts organizations against their “unpaid” tax “burden”.
     
     
  2. David Esrati December 16, 2009 / 1:39 pm

    @Mcohio- I’ve improved my properties, decreased crime in the vicinity and causer property values to increase, I’ve also employed people- should I not be subject to property tax?

    Property tax valuation is always a sticky subject- and one of the reasons “Fair tax” people get traction. One could argue that some of these organizations aren’t exactly charity cases these days- paying CEO’s salaries with two commas in them.

    We’re looking to start a discussion- not provide answers- but, you can’t tell me that GM and their taxes won’t be missed.

  3. jstults December 16, 2009 / 1:43 pm
    The Pittsburgh City Council delayed their vote:
    http://thechoice.blogs.nytimes.com/2009/12/16/a-first-in-the-nation-tax-on-college-tuition/
    A student quoted in the linked article:

    “Holding students hostage in negotiations with nonprofits to come up with money to pay for bloated city pension plans is divisive,” he said.

    Seems like the ‘preliminary vote’ was just a negotiating tactic that the mayor is using; they were trying to get the colleges to contribute annually to a fund, but they said (predictably) NO.  Maybe now they are willing to let the mayor squeeze them a little (seems like extortion to me).

  4. Will Brooks December 16, 2009 / 5:01 pm
    I only wish our local grand poobahs in city hall, who vote themselves “step” pay raises, would freeze, decrease, or eliminate their own salaries/positions. Taxing anyone else, or increasing taxes to make up for a shortfall should only further anger the populace. I say should cause most don’t care…I digress….
  5. Gene December 16, 2009 / 6:20 pm
    Or we could attract new business to Dayton and tax their properties and income. Why ruffle the feathers of non-profit? It is easy for the liberal agenda…. When times get tough, tax. When times are good, oh no, we would not anyone to actually make money, tax. Non-profits, frick, you don’t do enough free stuff, tax their asses too.

    Tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax tax.

    Or we could get real leaders with a true vision of courting new and existing/expanding businesses to Dayton to grow our tax base, provide jobs, bring in quality people, train and educate people, and become a better city.

    Or tax tax tax tax tax…….

  6. J.R.Erwin December 16, 2009 / 7:04 pm
    David, is DDN a non profit ?
    Moving all their business (chan 7 )…to one place…and building a new building…are they getting economic development dollars and tax abatements in/from  the city..??
  7. SheliaO December 16, 2009 / 7:09 pm
    Just a female vote against Richard Florida for the record.  Talk about a scam artist.
    As far as property taxes, why shouldn’t everyone pay their fair share of being in the neighborhoods?  I understand that it is an incentive tactic used in drawing businesses to an area, but if regular businesses have to pay property taxes (which all of the businesses that I have worked for in the private sector have paid property taxes) why shouldn’t the larger establishments of the Feds and the Meds?  Non Profits?  I’m not so sure about.
    I do agree with the concept of eliminating the tax abatement as an incentive.
  8. David Esrati December 16, 2009 / 8:30 pm

    @JR the DDN is still a for profit- and as far as I’ve heard, no tax incentives have been offered.

    @SheilaO- I’m not overly impressed with Richard Florida or his “research” or “solutions.”

    I’m in full agreement that tax abatement isn’t a good solution – and should be outlawed. As to the Feds paying property tax- that really doesn’t make sense, since it’s out of our pockets into our pockets. Even the CEO of the USA only makes $400K a year. That’s less than a UD basketball coach- or the president of Premier Health.

  9. Gene December 16, 2009 / 9:11 pm
    MVH allows people to get treated with govt money/non payments. So when you go to the delivery room a gal may pay nada. Emergency room as well.  We pick up the check for that one way (Medicare/aid) or another (insurance/payments.) So not paying property tax is (at this point) fine. Once we get Obama care it will be govt anyway! :)

    UD / Churches – entering a very touchy subject. Once you tax them then they will have more direct power over the government, and laws can change, and govt can change against the liberal will. Hope you get what you ask for….. Taxes payers have power. And the largest tax payers have the most power. GOOD LUCK! You may just get what you ask for….

    Funny. All businesses COULD make more money if they charged more to their customers, according to the tax lovin’ liberal. How about attracting business to Dayton? More bang for your buck. You get the taxes, you employ people, and the cost is not passed on to the customers. More taxes just mean higher charges to customers. Please take your heads out of ….. the ground.

    Businesses do not pay taxes. The customers do.

  10. Shortwest Rick December 16, 2009 / 11:39 pm
    I’m trailing away from the taxing non-profits subject, @Gene ‘ How about attracting business to Dayton? More bang for your buck.’  I sort of followed the comments today on DDN ‘What can Dayton do to stop shrinking’ and this seems to be almost everyone’s take, attract business.

    I’m going to say it on Esrati because I’d be braying with the donkeys if I said it on DDN and it would be lost:

    Dayton suffers from the GM/NCR era mentality that big business and corporations will provide jobs to the population. Having followed that ideal, spending at big boxes, chains and franchises  Daytonians have kicked every mom & pop and small business to the curb. Take a drive by Gem City Records and wave goodby. Take a drive up Short North in Columbus, it’s all thriving small businesses… that the difference…

  11. Will Brooks December 16, 2009 / 11:45 pm
    @Shortwest Rick – great post.
  12. Gene December 17, 2009 / 12:14 am
    Business Solves Problems… Taxes, not so much.

    O.O.O.

    Order Of Operation.

    Business, Jobs, Taxes. Not the other way around.

  13. Shortwest Rick December 17, 2009 / 12:21 am
    Small business employs local people – pays taxes – weathers the downturn cycle – big business lays off when the profitability factor drops below expectation and closes
  14. SheliaO December 17, 2009 / 12:28 am
    If the Feds paying taxes is out of our pockets – into our pockets – at least it’s a circle of money that wouldn’t be touched! :)
  15. Shortwest Rick December 17, 2009 / 12:45 am
    Here’s one for you SheliaO, over the last ten years I’ve seen numerous times city inspectors hanging code violations on the front door of city owned properties… how’s that going to work out?
  16. Gene December 17, 2009 / 9:37 am
    Small business is super important, but let’s not romanticize it too much. Small businesses lay off people, close and do not always weather the downturn cycle.

    I like the big box comment, especially when liberals apply it to their lives. Yet they yearn for small specialty shops, or they shop in NY via Internet, or take their money to the Best Buy in Greene Co. rather than the Best Buy in Montgomery Co. Oh, but they are allowed to.

  17. Ice Bandit December 18, 2009 / 6:55 pm
    The Ice Bandit was in friendly, albeit spirited debate with the Ohio gubernatorial hopeful, who was outlining his plans for the Buckeye State’s future. The candidate was Jerry Springer (yeah, that Jerry Springer, but without the midgets, bombast and fisticuffs) and his every other word was “jobs.” Jobs for the disadvantaged, careers for college graduates who would not have to leave Ohio for other states, and employment for those jobs had left the country. But when quizzed by El Bandito de Helios how he planned to work this economic miracle, Jerry went off on a tanget that would have put a puzzled look on the face of Rod Serling. Under a Springer administration, Jerry explained, there would be mandatory paid maternity leave, a day-care center on every vacant block, compulsory (and yet, unenforcable) laws that require notification for plant closings and movements, and a variation of the card check proposal that would make union organizing almost de rigeur. By this time, Jerry was on a roll, and he now shifted his emphasis  to taxation. And what he wouldn’t tax, after his rapid fire tax everything proposals, was the air. El Bandito calmly assured Jerry and his radio audience that if even a quarter of his proposals were adopted, not only would no new industries be created nor relocated here, but also so many Ohio businesses would fold their tents that one would have to go to Richmond, Indiana to procure a hot dog. But like a lover in denial, Jerry could not fathom that his proposals would spell economic ruin for this state or whatever area they would be implemented. After all, he had bounced all of these ideas off of some of the best minds in the Ohio Democratic Party, who gave him a thundering thumbs up. It was at this moment the Old Bandito was struck with this cosmic truth; not only do Democrats not understand the most basic of economic truths, but their groupthink and worldview prohibit them from learning these tenents. Like trying to convince a Mother Superior that only a limited number of angels can dance on the head of a pin, trying to educate liberals about economies is a fruitless and pointless exercise……
  18. Joe December 21, 2009 / 11:00 am
    Now that UD Research Institute and UD have bought the NCR head quarters, this discussion is more relevant. Could City of Dayton have attracted a tax-paying corporation or business to fill that spot?

    I like the move by UD. The building gets filled, and UD continues to grow. It would have taken years to fill a space like that.

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