A growing body of literature over the past decades
has sought to assess the extent to which new suburban development pays
or does not pay its own way in municipal services and infrastructure. The
issue is of immediate policy concern because tax transfers from existing
to new development are thought by some to represent a significant subsidy
to urban sprawl. Some studies on the fiscal impact of sprawl generally
focus on municipalities and school districts. Little has mentioned the
fiscal impact of sprawl on taxpayers or households in terms of the change
in property tax rate as politically perceived tax burden, or property tax
bills as actual household tax burden. Therefore, it is still unclear whether
suburban households are fiscally better or worse off due to sprawl.
Most literature has defined sprawl as unlimited low-density development
(Downs, 1998). The four land use categories in SEMCOG land use coverages
are medium to high rise multi-family, low-rise multi-family, single family
and duplexes as well as mobile home park. Therefore, based on data availability,
the proposed study will look at whether the increase in single family and
duplex land use from 1985 to 1995 is associated with the increase in property
tax rate or property tax bills during the ten years in Southeast Michigan.
First, consider growing suburban Minor Civil Divisions
(MCDs) where land value increases or at least remains the same. If its
tax rate increases over time, there is no question that actual household
tax burden increases. However, when its tax rate decreases over time,
it is unclear how actual household tax burden changes depending on the
extent to which land value increases. Although some literature has
mentioned that the decay of downtown is associated with sprawl of a metropolitan
area (Downs, 1998), it is hard to associate the increase in single family
land use to any fiscal impact in decaying MCDs. Therefore, the study
concentrates on growing southeast Michigan MCDs, whose land value has increased
over time. They will be the units of analysis for multiple variable
regression models to study how much the increase in single family land
use accounts for the change in property tax rate. In order to study households’
true tax burdens in the MCDs with an increase land value but a decreased
tax rate, the study will sample households within these MCDs that exist
from 1985 to 1995 to see how their actual tax bills change.
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Land Value |
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Tax Rate |
Increase/Constant...................Decrease |
Increase/Constant...........................Decrease |
Tax Bills |
Increase/Constant.......................Unsure |
Unsure..............................................Decrease |
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