Linked to: Trustees Elected at Large turn Small, Voter's Forum (keithmoens.blogspot.com)
March 19, 2013
E-mail From:
Keith A. Moens
To Village President Mulder and Trustees:
mayor [email protected], thayes [email protected], cblackwood,[email protected], nbreyer [email protected], jfarwell [email protected], tglasgow [email protected], brosenberg [email protected],
[email protected], [email protected]
Dear Village President and Trustees,
How a tax subsidy to Homeowners could work:
For example there are about 23,100 property tax paying households in Arlington Heights. The Village would issue a debit card style deposit or coupon for $50 to each taxpaying household. This amount must be spent in Arlington Heights at participating local stores. The resident can not spend the rebate anywhere but at Arlington Heights businesses. If the homeowner rebate is not spent the Village retains the stimulus money.
If all money is spent it would translate into about $1.16M directly into the local Arlington Heights economy. There would also be a revenue multiplier effect as well from the initial stimulus to the local economy. We could use the multiplier estimate that is calculated for the subsidy to maintain the Metropolis Theatre.
According to the American for Arts Advocacy The Metropolis contributes an estimated $5M in revenue boost to Arlington Heights businesses. Based on the annual Village contribution to the Metropolis of $150,000 that is a 33 to 1 multiplier or using $317,000 for FY 2014 translates into 16 to 1 multiplier effect. More accurately a Metropolis operating budget of $2.5M translates into a 2 to 1 revenue effect.
Using an accepted macro economic multiplier estimate of about 3 to 1, during a recession, a consumer driven stimulus of $1.16M would generate about $3.5M in revenue to Village businesses.
The advantages to forcing the resident to spend their tax rebate locally are many:
1.) Resident demand chooses which business will succeed
2.) The Village can collect additional sales tax to offset the initial stimulus cost
3.) Businesses are realizing the benefit of local homeowner spending
4.) The Village does not have to decide which business if any should ever get tax subsidies
5.) The stimulus could be focused directly at a particular area or enterprise such as the Metropolis Theatre
6.) The rebate could be structured to lower income levels that have higher revenue multipliers
7.) Other villages are not focused on demand side stimulus to address their vacancy problems
8.) The Village is helping financially stressed homeowners
9.) This is an innovative method to address existing slack business capacity
10.) Vacant stores would naturally disappear as customer demand improves
This approach supports local businesses, the homeowner and the Village.
The Arlington Heights resident is financially stressed and needs support as discussed in the CMAP study. Continuing to give tax breaks to businesses without supporting local homeowner demand will only hasten when the business will fail or add to the existing business vacancy rate.
Thank you for your time and attention. I look forward to your thoughts and comments.
Sincerely yours,
Keith A. Moens
March 19, 2013
E-mail From:
Keith A. Moens
To Village President Mulder and Trustees:
mayor [email protected], thayes [email protected], cblackwood,[email protected], nbreyer [email protected], jfarwell [email protected], tglasgow [email protected], brosenberg [email protected],
[email protected], [email protected]
Dear Village President and Trustees,
How a tax subsidy to Homeowners could work:
For example there are about 23,100 property tax paying households in Arlington Heights. The Village would issue a debit card style deposit or coupon for $50 to each taxpaying household. This amount must be spent in Arlington Heights at participating local stores. The resident can not spend the rebate anywhere but at Arlington Heights businesses. If the homeowner rebate is not spent the Village retains the stimulus money.
If all money is spent it would translate into about $1.16M directly into the local Arlington Heights economy. There would also be a revenue multiplier effect as well from the initial stimulus to the local economy. We could use the multiplier estimate that is calculated for the subsidy to maintain the Metropolis Theatre.
According to the American for Arts Advocacy The Metropolis contributes an estimated $5M in revenue boost to Arlington Heights businesses. Based on the annual Village contribution to the Metropolis of $150,000 that is a 33 to 1 multiplier or using $317,000 for FY 2014 translates into 16 to 1 multiplier effect. More accurately a Metropolis operating budget of $2.5M translates into a 2 to 1 revenue effect.
Using an accepted macro economic multiplier estimate of about 3 to 1, during a recession, a consumer driven stimulus of $1.16M would generate about $3.5M in revenue to Village businesses.
The advantages to forcing the resident to spend their tax rebate locally are many:
1.) Resident demand chooses which business will succeed
2.) The Village can collect additional sales tax to offset the initial stimulus cost
3.) Businesses are realizing the benefit of local homeowner spending
4.) The Village does not have to decide which business if any should ever get tax subsidies
5.) The stimulus could be focused directly at a particular area or enterprise such as the Metropolis Theatre
6.) The rebate could be structured to lower income levels that have higher revenue multipliers
7.) Other villages are not focused on demand side stimulus to address their vacancy problems
8.) The Village is helping financially stressed homeowners
9.) This is an innovative method to address existing slack business capacity
10.) Vacant stores would naturally disappear as customer demand improves
This approach supports local businesses, the homeowner and the Village.
The Arlington Heights resident is financially stressed and needs support as discussed in the CMAP study. Continuing to give tax breaks to businesses without supporting local homeowner demand will only hasten when the business will fail or add to the existing business vacancy rate.
Thank you for your time and attention. I look forward to your thoughts and comments.
Sincerely yours,
Keith A. Moens