Paying for Planning

This book chapter searches through what is known and what is new for different revenue sources for local governments, determining that the issue regarding tax revenue is to understand how the relative mix of the three taxes should change. Property tax is scrutinized as a benefit or distortionary capital tax and its relation to the capital labor ratio; in addition, states’ limits on local allowable tax rates reduces localities options to increase revenue to influencing the size of the tax base. Local governments also have the responsibility to determine relative equity of the taxes, relying on benefit taxes over income redistribution, and acknowledging how revenue methods are utilized effects the distribution of services. TIFs, BIDs, impact fees, and the monetization of assets in an attempt to generate revenue are also analyzed for their efficacy.