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[personal profile] jducoeur posting in [community profile] davis_square
I just got a scare robo-call, apparently from alderman Tony Lafuente, asking me to come to tomorrow night's aldermen's meeting because of the "unprecedented tax increases" in Somerville. Sounds like he's trying to get a mob with torches and pitchforks there, but I haven't the foggiest notion what he's talking about. Anybody have info?

Date: 2014-02-04 03:12 am (UTC)
From: [identity profile] josephineave.livejournal.com
I think the tougher problem is for businesses that don't own the property. Many of the leases have clauses that pass through the property taxes to the renter, so you end up with a much higher bill even though you aren't getting the benefit of ownership.

Date: 2014-02-04 04:22 pm (UTC)
From: [identity profile] achinhibitor.livejournal.com
The problem is pretty much unavoidable: Because the average business in Davis can now make significantly more money, landlords can charge more rent. (As far as I know, essentially no retail businesses own their location.) So the value of the property increases. The city increases the assessment and the tax bill increases. (Except in the unlikely event that the city cuts the rates enough to fully compensate.) Businesses start paying for the tax bill through either pass-through leases or increased rent the next time the lease rolls over.

The problem is felt by businesses that aren't seeing as much of an increase in profits as the "average" business is. Additionally, the increase in "average" business profit is significantly due to changes in the mix of businesses, the mix includes more upscale businesses. What ultimately happens is that downscale businesses start to get squeezed by the increasing costs of the location.

if the landlords aren't sensitive to the neighborhood and the kinds of business that make Davis what it is

The landlords will rent to whoever is willing to pay the most.

As for avoiding Harvard Square-ization, all of this is driven by the increasing presence of affluent people. How do you propose to drive out the yuppies? Worse, "We have met the enemy, and he is us."

Date: 2014-02-05 03:27 am (UTC)
From: [identity profile] achinhibitor.livejournal.com
I'm unclear on who *likes* Harvard Square in its current state

Clearly there are people who buy the things for sale in Harvard Square's stores.

The problem is that while you like the look and feel of Davis Square, there's no mechanism for you to contribute money to support it. The only way people can support it is by buying things there. And clearly, if the stores are replaced with more expensive stores, and people buy at the new stores, they're willing to support the new stores more than the old ones -- because they're paying more. I suppose you could arrange for a tax levy on the houses in the neighborhood for some sort of "stabilization fund" that would subsidize the leases of "old style" businesses in the Square.

No, not true

Date: 2014-02-05 02:56 am (UTC)
From: [identity profile] miss-chance.livejournal.com
It's not true that people would kill to lose their homes and their businesses to astronomical increases in property value that force them to move away from their community. When you buy a house and think "this is my home, I will live and grow old here," when you plant a garden, build your own deck, start a small business, grow a network over decades of investing time and love into your neighborhood, you don't say, "Hey, I'm being displaced; my income will no longer pay the taxes on this property I've owned for twenty years, and I'm going to have to tear out all my roots and start again some place new. But WOW it's so great how much my property value went up! That's swell! Thank You Invisible Hand of the Market, May I have another?"

No, I don't agree that this is a problem other places would love to have. It's a real, heartbreaking issue that people care deeply about. A lot of people are terrified of losing everything they made with their own two hands.

That said, yes the Robo Call sounds like it was clumsy. It's probably easy to forget this isn't on everyone's minds.

Date: 2014-02-05 03:22 am (UTC)
From: [identity profile] achinhibitor.livejournal.com
"this is my home, I will live and grow old here,"

You'd like to think that when you buy a piece of dirt, you've got a permanent grip on it. But it isn't true, there are a lot of things that could go wrong, and society doesn't issue that sort of guarantee. And things are even less secure with things that one does not officially own.

Date: 2014-02-05 03:57 am (UTC)
From: [identity profile] miss-chance.livejournal.com
All true.

And when the same thing seems to be going wrong for a lot of people at the same time, that tends to be when people start picking up their pitchforks.

Date: 2014-02-21 04:09 pm (UTC)
From: [identity profile] achinhibitor.livejournal.com
Preventing gentrification is difficult. To a considerable degree, Prop. 2 1/2 (in Massachusetts) limits the increase in taxes on homeowners, which prevents homeowners from being priced out of their houses. I don't know if it protects landlords as well; landlords might get stuck with large tax increases, which they will pass on to their tenants. Of course, if the actual market value of an apartment rises, landlords will generally raise the rent correspondingly. Rent control measures can prevent that (and will thus prevent the increase in the value of the property). But rent control has been outlawed in Massachusetts.

I gather that San Francisco has strict rent control, but the difference between the market value of apartments and the rent controlled value has become so high that people are engaging in many devices to escape rent control, and gentrification is proceeding anyway.

In the long run, it's difficult to stop. The only political mechanism that would work reliably is to make the area less desirable to live in for people who are more affluent than those who live there already. Politicians can do that if they work at it. Mob violence doesn't work very well because there isn't a specific set of actors who are driving the process, the culprits are all the people who are willing to pay "more money" to live there.

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