The Suburbs Are Afraid of Urban Revitalization

economics, politics

I have to hand it to Matt Assad and Scott Kraus.  They’ve been all over the arena issues and are doing a great job framing the story in the pages of the Morning Call.

Now that resolution is in sight, here’s my last word, for now, on the whole issue.

Townships keep saying “we’re for the arena, we just don’t think our tax money should pay for it.”

I could go with the tried and true appeal to regionalism.  Instead, I’ll say, yet again, “it’s not your money in the first place.”

The money is earned in Allentown.  Before 1962, it stayed in Allentown.  50 years ago, for reasons that have everything to do with the wholesale government subsidization of White Flight, the townships of Pennsylvania started getting the EIT money their residents earned in the City.

The suburbs have benefited from this swindle for five decades, and for whatever good it’s done for people raised there, it’s also falsely lowered the cost of living and doing business in areas otherwise removed from established urban cores.  It’s falsely lowered the cost of turning cornfields into infrastructure and green space into sprawl.

It’s time to change that course, especially with the bumper crop of underwater suburban mortgages and all the studies in the world suggesting that young people and retiring Boomers want to live in walkable urban centers.

It’s true that the legislation that shifted  the EIT back where it belongs still smells like backroom smoke.  But that doesn’t mean the EIT shouldn’t stay in Allentown or that it shouldn’t help fund revitalization there.  The other smell, wafting in from the suburbs, is fear.  Township leaders know their communities aren’t finally sustainable the way a revitalized, greener Allentown would be.  They know young people don’t want to live in suburbs and retirees don’t want to mow big lawns.

One thought on “The Suburbs Are Afraid of Urban Revitalization

  1. This post strikes me as more of an intellectual crutch than an intellectual argument.

    1. Before World War II, many communities around Allentown were thinly populated and had few services. When people, given a choice, moved to the communities where they didn’t work a solution was found to give some financial support to the community of residence. This was a law, not a conspiracy.

    When a family of four live in Town A and the breadwinner works in Allentown, Allentown gets the real estate taxes for the building, the gross receipts tax from the business, and the taxes from the other businesses that the workers supports in town. There are three other people in the family that use Town A’s services. State law doesn’t give a lot of options to account for that.

    To go in the circular argument that tax arrangements “falsely subsidize” activity or that EIT “belongs” to anyone is getting to be a tiresome argument. It IS cheaper to do business in less developed locations. That’s why Mack Trucks moved from Brooklyn to Allentown. Would you argue that Allentown “falsely” benefited from having Mack Trucks in town for several decades when they “rightly” would have been in New York?

    2. If the amount of tax in the EIT zone being sent out of the city is laughably small in the most productive zone of the city, doesn’t the reverse hold true? That we really aren’t talking about a huge amount of money to begin with? The Morning Call suggests that EIT from downtown going back to communities is between 1 and 2 million a year, so lets triple that to 6 million. This is a city with an 85 million dollar budget!!! The big cut of money is the $16 million in STATE taxes. Why are the suburbs responsible for that?

    3. The idea that suburbs are just going to depopulate is still fanciful. the problem is in “exurbs”, not suburbs. The Lehigh Valley generally doesn’t have close to the kind of sprawl that has been a problem in California and Sun Belt cities. A quick analysis of housing values in Allentown and surrounding communities indicates something else. That hipsters today are willing to pay $2k/month for a crappy 800 square foot apartment in Brooklyn or DC doesn’t mean they’ll do so in 10 years. Or the suburbs could become more walkable too!

    Allentown’s problems stem from the loss of major industries, not population movements, greenfield development, or some obscure law from 1964.


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