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The Sapphire Necklace The new map of tax base disparities in Northeast Ohio Copyright 1997, EcoCity Cleveland Reprinted with permission. |
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By David Beach EcoCity Cleveland Greater Cleveland is famous for its Emerald Necklace, the wonderful network of parks encircling the area. But another necklace— one with troubling implications—has developed in recent years. This is a necklace of suburbs that is capturing much of the regional growth in tax base and is leaving behind the urban core and older suburbs. In a new study, which documents the magnitude of these tax base disparities for the first time, this band of migrating wealth shows up on the maps in deep blue. Researchers have dubbed it the "Sapphire Necklace." The study and maps were officially released December 19, 1997, at the City Club of Cleveland on the occasion of an appearance by Myron Orfield, a national expert on metropolitan development trends. Orfield has been helping researchers at Cleveland State University develop computerized maps that graphically show the distribution of tax base and other indicators of community wealth in Northeast Ohio. While it's common knowledge that there are poor and wealthy areas in the region, the new study maps out exactly where these areas are located, as well as how shifting tax base relates to housing construction, income disparities, racial disparities and public policies. "Now we know the magnitude of the numbers of people affected by these trends," says the study's author, Tom Bier, director of the Housing Policy Research Program at CSU's Levin College of Urban Affairs. "More than two thirds of the region's population lives in the lower tax base areas." The Sapphire Necklace is a band of high tax base cities, villages and townships that extends mostly northeast-southwest between Lake and Medina counties. (See map on the next page. The light gray band of high tax base communities stands out in blue on the color version of the map.) Among the troubling implications of the study: • The future of Cuyahoga County is at risk, as erosion of tax base moves from the inner city and increasingly affects inner-ring suburbs. Tax base is the life blood of communities, since it determines the quality of services, schools and infrastructure communities can afford. • Long-established public policies and practices (especially the construction of new highways) have favored the development of new communities at the outer edges of urban areas over maintenance and redevelopment of established, older communities. Unless these public policies change, the region faces a future of spreading decline, environmental degradation, and loss of farmland and natural areas. • The fragmented political structure of Northeast Ohio, which pits communities against one another in the competition for tax base, prevents cooperation for balanced development. The study recommends that the State of Ohio require the counties of Northeast Ohio to create a plan jointly to achieve balanced tax base growth across the region. "Local communities can't address the problems by themselves," Bier says. "The state must lead them to it." The study also calls on the state to enable local governments to implement regional tax growth sharing—a system by which a portion of the property tax revenues created by development in communities with the strongest tax bases is used to promote maintenance and redevelopment in communities with the weakest tax bases. Such a system has helped to reduce disparities in the Twin Cities area of Minnesota. By sharing the benefits of new development, lower-income communities have a greater chance to compete, and the entire region achieves a higher quality of life. The CSU study looked at the status of tax bases in the 226 cities, villages and townships of the seven-county region (Cuyahoga, Lake, Geauga, Portage, Summit, Medina and Lorain counties). Below is a summary. Conclusions • Tax bases are strongest primarily where real estate development is occurring in the Sapphire Necklace, a band of cities, villages and townships that extends northeast-southwest between Lake and Medina counties. Tax bases are weakest in fully developed communities and in rural districts where little development has occurred. Thirty-two percent of the region's population lives in communities with the strongest tax bases, and 68 percent lives in communities with the weakest tax bases. Tax base growth is greatly imbalanced across the region, with some communities gaining substantially while others are gaining little or are losing. Property tax rates are similarly varied. • Fully developed communities— communities whose land has already been used—are at a major disadvantage in economic competition with communities that have substantial amounts of undeveloped land. Redevelopment of used sites typically is costly when compared with development of never-used land. • Cuyahoga County is nearing the end of its supply of suburban undeveloped land, and nearing the end of its capacity to grow its tax base through construction on that land. The amount of unused land remaining in Cuyahoga County is trivial compared with what exists in adjacent counties, particularly in Geauga, Portage, Medina and Lorain counties. Tax base growth in Cuyahoga County now depends on redevelopment and maintenance of existing real estate and communities. • Under existing public policies: a) Development will steadily expand across the rural areas of the region; population and employers will move to those locations. Tax bases of developing communities will grow (so too will needs for tax revenues, such as for expansion of public services and schools). b) Tax bases of many developed major cities and suburbs will grow little, if at all, while needs for tax revenues will increase. Tax rates in developed communities will continue to exceed those of developing communities. c) Cuyahoga County will become increasingly unattractive as older suburbs decline and as costs of living in, and doing business in, the county increase, pushing a growing number of residents and employers to move out. Recommendations The situation documented in this report is largely the making of long-established public policies and practices which have favored the development of new communities at the outer edges of urban areas over maintenance and redevelopment of established, older communities. Alteration of existing patterns and trends requires change in state and local governmental practices and policies: • Multi-county planning for balanced development. State government should require the counties that comprise the Greater Cleveland region to jointly create a plan to achieve balanced tax base growth across the region. State directive is necessary because local governments are unable to initiate such action; they are fragmented, bound by governmental independence, and pitted against each other in competition for tax revenues. • Regional tax growth sharing. State government should enable local governments to implement regional tax growth sharing—a system by which some of the property tax revenues created by development in communities with the strongest tax bases are used to maintain and redevelop communities with the weakest tax bases. Communities with the weakest tax bases lack the resources to strengthen their situation. Also, until the pressure to compete for tax revenues is reduced across the region, serious intergovernmental cooperation cannot occur. Implementation of these two recommendations would move the region toward a future in which spreading decline is checked, older communities are maintained and redeveloped, rural communities retain more of their distinctive character as they grow, and farmland and rural open spaces are preserved. The study, "Tax Base Disparity: Development of Greater Cleveland's Sapphire Necklace," was completed by the Housing Policy Research Program of the Levin College of Urban Affairs, Cleveland State University. For more information, contact Tom Bier at 216-687-2211. Copyright 1997, EcoCity Cleveland Reprinted with permission. << Back to Press Clippings |
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