Why not "tax" the "subsidies" and profits and use the revenue generated to
promote low-income housing and home ownership, retention of those elements
that contribute to the "social capital" and other techniques. Brownfields
are in some ways the "baths of Ibsen" and therefore can be viewed as the
"enemy of the People! Can we structure the acquisition cost, appraisal,
tax benefits, profits so that the current and future residents of the
community benefits. For ex. if a community is attractive because of the
prominence of a particular environmental amenity -- park space-- can we
dedicate a percentage of the revenue that goes to the local, state and
federal gov't to be used for maintaining the park and even better educating
others-- especially children about the importance of open space. What
values are promoted and sustained through brownfield revitalization?
-----Original Message-----
From: Lenny Siegel <lsiegel@cpeo.org>
To: cpeo-brownfields@igc.org <cpeo-brownfields@igc.org>
Date: Friday, February 12, 1999 6:54 PM
Subject: Subsidies and Gentrification
>SUBSIDIES AND GENTRIFICATION
>
>Recently I attended a meeting where proponents of state brownfields
>legislation called for tax incentives and other subsidies to encourage
>brownfields cleanup and redevelopment. The arguments are familiar: A
>small subsidy can encourage the reuse of long dormant property, creating
>jobs, business opportunities, and direct tax revenue in long blighted
>areas.
>
>Unfortunately, unless such subsidies are carefully designed, brownfields
>activity can add insult to injury, forcing out - like the urban removal
>programs of the 50's and 60's - the people and businesses that have long
>endured the deteriorated social and environmental conditions of the
>community in which the brownfields lie. That is, seemingly positive
>brownfields programs can promote gentrification.
>
>Here in the San Francisco Bay Area, where property is intrinsically
>valuable, any effort to clean up contamination, crime, or other blight
>usually forces out long-time residents and businesspeople, particularly
>if they rent their property. Virtually any long-developed property in
>the region is within commuting distance of high-paying jobs (for highly
>educated people) in the San Francisco financial district or Silicon
>Valley.
>
>Untargeted brownfields subsidies remind me of another tax break, the tax
>deductions for home-ownership. Originally designed to promote
>home-ownership, this extremely well-entrenched provision of state and
>federal tax codes actually penalizes low-income people who wish to buy
>homes. That's because higher-income people get greater tax benefits from
>deductions because they are in higher tax brackets. For many years,
>absentee landlords reaped such enormous tax benefits from the purchase
>of residential rental property that many regularly re-sold property to
>increase those advantages. I believe that recent tax-law changes have
>limited absentee tax breaks, but people in lower tax brackets still have
>trouble competing against more affluent homebuyers.
>
>I am not suggesting that the mortgage tax deduction be eliminated.
>Rather, we should use the example try to avoid similar mistakes. Tax
>breaks and other subsidies should be evaluated upon their differential
>impact. We should beware their self-perpetuating nature: Even if they
>don't serve their announced purpose, they might, like the mortgage
>deduction, create a massive constituency with an interest in maintaining
>the subsidies.
>
>Brownfields development incentives, therefore, should be targeted to
>people who have lived, worked, or operated businesses in Brownfields
>areas for minimum lengths of time. This can be done directly, or they
>can be made available to intermediaries on the condition that the
>benefits be transferred to people from the area. Otherwise, brownfields
>subsidies will work against one their announced purposes: revitalizing
>communities.
>
>
>Lenny Siegel
>--
>
>
>Lenny Siegel
>Director, Center for Public Environmental Oversight
>c/o PSC, 222B View St., Mountain View, CA 94041
>Voice: 650/961-8918 or 650/969-1545
>Fax: 650/968-1126
>lsiegel@cpeo.org
>(PLEASE NOTE THAT WE ARE PHASING OUT
>MY OLD E-MAIL ADDRESS: lsiegel@igc.org)
>http://www.cpeo.org
>
>
|