Consolidation of New Jersey Towns Could Mean Higher Taxes

Comment in Response to "Consolidation is Key to Save NJ"


Consolidating local governments makes sense only in ivory towers, not in the real world.

In the last few years, Pennsylvania and New York started initiatives to consolidate their governmental structure. They took to heart the usual mantra that there are hundreds, even thousands of governments in the state and that they must be consolidated to save money. In both states, the efforts were clothed in promises that local government consolidation would improve competitiveness relative to other states.
However, the proponents never bothered to look at the data.

We did and the results were stunning. In both states, an equivalent “market basket” of spending was compared. In Pennsylvania, the largest local jurisdictions spent (including a per capita allocation of county expenditures, so that Philadelphia could be included. Social service spending was excluded) 150 percent more per capita than jurisdictions with between 5,000 and 10,000 population. The largest jurisdictions — those over 250,000 people — spent 200 percent more than jurisdictions with under 2,500 residents.

Moreover, it is not a matter of urban versus rural. Our work for the Pennsylvania Association of Township Supervisors showed that in both the Philadelphia and Pittsburgh areas, there are literally hundreds of suburban jurisdictions that spent at less than one-half the per capita rate of the central cities.

The story was little different in New York. Our report for the Association of Towns of the State of New York indicated that the largest jurisdictions (those over 100,000) spent nearly double per capita as jurisdictions with between 5,000 and 10,000 population (this would have been even greater if it had been possible to include New York City). The big governments spent even more (more than 150 percent) compared to jurisdictions with between 1,000 and 2,500 population. The differences were even greater within metropolitan areas, where smaller jurisdictions were even more efficient relative to the largest jurisdictions.

The reality is that there are few, if any economies of scale in local governments, except for the special interests that can influence them more readily, for less cost, as the town hall is moved farther away from citizens.


The Flawed CNT Housing & Transportation Index

The Center for Neighborhood Technology (CNT) has produced a housing and transportation index (the "H&T Index"), something that has been advocated by Secretary of Housing and Urban Development (HUD) Shaun Donovan and Secretary of Transportation Ray LaHood. The concept is certainly worth support. Affordable housing and mobility are crucial to the well-being of everyone, which translates into a better quality of life, more jobs and economic growth. Surely, much of the internationally comparatively high standard of living enjoyed by so many middle and lower income households in the United States has resulted from inexpensive housing (often on the urban fringe) and the ability to access virtually all of the urban area by quick and affordable personal transportation.

CNT has developed an impressive website, with "tons" of data and maps that are both impressive and attractive. But for all of its superficial impressiveness, the H&T Index is subject to serious misinterpretation and suffers from methodological flaws that neutralize the usefulness of its affordability indices.

More: http://www.newgeography.com/content/001526-the-muddled-cnt-housing-and-transportation-index


Smart Growth Encourages Land Banking and Destroys Housing Affordability

Re: Huge Land Bank Puts Squeeze on
The Age (Melbourne)

Land banking is a normal market reaction to a regulatory regime in which
land for new housing is severely rationed. Like any business, developers
must ensure that they have sufficient inventory to operate. With arbitrary
planning policies that ration land, it would be easy for a developer to be
driven out of business because competitors have cornered the market (for
land). Yes, it is outrageous that a block of land for a house costs
$180,000, but do not blame the land bankers, blame the government policies
that have unnecessarily made housing unaffordable for the average

In Atlanta and Dallas-Fort Worth, the high-income world's fastest growing
metropolitan areas, finished (serviced) land for new housing is at least 75%
lower than in Melbourne. This is because these metropolitan areas have not
implemented the destructive urban consolidation (smart growth) policies that
have been imposed in all of Australia's largest cities.

The result, of course, is that residents of Dallas-Fort Worth and Atlanta
spend far less on housing and have more discretionary income to spend on
other goods and services.



How Cars Are Killing Us Around the World



Of course, traffic deaths are regrettable and great progress has been made in their reduction. Traffic deaths in the United States today are about the same as in the late 1950s, despite the fact that driving has increased to 5x the rate at that time.

Virtually everyone who uses a car recognizes the risks. The connection between the superior personal mobility provided by cars and the eradication of poverty could not be more clear. That is why car ownership expands as fast as people can afford cars, whether in the United States, Europe, China or the Democratic Republic of the Congo.

A more revealing and relevant graphic would show traffic deaths compared to gross domestic product.