2009
What a wonderful new year we have ahead of us. We all have great anticipation of what our new President, Barack Obama, will accomplish. Our prayers to him, that he has the wisdom and courage and God’s guidance to lead this great nation.
Here in Arizona, we congratulate Gov. Janet Napolitano for being selected as Secretary of Homeland Security. We also are grateful that Secretary of State Jan Brewer is so well-prepared to assume the role as governor of Arizona.
There are some real challenges for the United States of America from the federal government right down to the small-town politics here in Tucson and Pima County.
Let’s start at the bottom. Tucson just can’t get its priorities straight. We can bond $7.6 million for solar panels on government buildings but refuse to hire enough police to stop the rampant crime that plagues our city. Recycling garbage bags seems to have a higher priority than creating a business-friendly community that will attract jobs and foster prosperity for our families. Rio Nuevo Tax Increment Financing is in great jeopardy of being pulled because of lack of a clear plan and the absence of transparency of past and current spending. The Mayor and City Council must re-evaluate their priorities to address current and future needs of our community.
Pima County just spent $18 million to buy another ranch so cattle can no longer graze and by doing so, eliminated another piece of property from our tax rolls. Surely during economic hard times, Pima County government could spend less on buying land so we and our children cannot live on it and provide more needed services like public safety, roads, parks and perhaps even invest in economic development. Major League Baseball spring training might have remained in Pima County with a 18 million dollar investment.
The towns of Marana, Oro Valley and Sahuarita seem to be doing a better job taking care of business than the two 800-pound gorillas, Tucson and Pima County.
Jan Brewer has a bittersweet gift of inheriting the job as governor. The party is being spoiled by an unwanted substance floating in the celebration punch bowl, a tremendous budget deficit. We are fortunate that we elected legislators that are willing to do what is necessary to cut expenses, while keeping the state ship afloat. Their job has to be one of the most difficult tasks for any elected officials. We encourage them to keep their resolve.
Nationally we wanted change. I hope the folks we elected to lead the greatest nation on Earth remember our heritage of asking God for guidance and then doing the right thing..
Financial instability can always be overcome with hard work, prudent spending and patience. World unrest is another matter. We are seeing Bible prophecy unfolding in the Middle East right in front of our eyes. Israel is being faced with animalization by much more than the nuisance of Hamas. Iran is about to become a nuclear power. Its leaders are bent to destroy Israel entirely. Allies like Russia, Syria and others illustrate a mirror image of the story in the Bible book of Revelation about Armageddon. What will we do?
This is some real serious stuff, isn’t it? A lot heavier than fixing potholes and paying the bills. What all elected officials have in common is that God himself has a hand on them and for that we are grateful.
More good news is that we live in America where we have the opportunity to actively participate in the process of government. With that comes the responsibility to not only voice our opinion, but to lift up and elect the people to government that best represent our values.
With all that said, I anticipate that even with all the seemingly insurmountable challenges we face that with the Lord’s help, 2009 will be a wonderful year.
Tuesday, January 6, 2009
Friday, November 14, 2008
Impact Fees and Affordable Housing
Impact Fees and Affordable Housing
By Paul Parisi
Before 1992, development impact fees were not allowed in Arizona. That year the legislature passed a bill that enabled cities and towns to enact these fees. The 1999 Growing Smarter legislation enabled counties the ability to impose development impact fees.
Before the 1990s, growth in Arizona actually paid for itself. This is evidenced by the fact that property taxes were low, home prices were affordable compared to most other states and local, county and state governments were providing all necessary services. Affordable housing encouraged companies of all sizes to locate in Arizona where their employees could experience the American dream of home ownership. Job growth provided a healthy sales tax base that allowed government to pay for public safety, roads, parks, sewer treatment, water and other amenities.
Since the introduction of development impact fees, the size and cost of government have grown disproportionably to the increase in population. Government entities have spent a considerable portion of impact fee revenue for expensive studies to justify escalating fee increases. Additional government staff has been hired to administer the complex formulas to distribute funds for projects within the impact fee boundaries. Bureaucrats and politicians have developed an insatiable appetite for projects that far exceed revenues. Most importantly, affordable housing for the common working person has diminished.
Everyone knows that impact fees are not paid for by the developers and home builders. We the consumers pay these fees in the form of higher housing costs. When this occurs, fewer individuals qualify for mortgages, fewer new homes are built, fewer workers are hired in the construction and related industries, fewer commissions are paid to real estate agents and fewer taxes are paid to the government. Just look at our state and local government budget deficit that has a direct correlation to the decline of the housing industry. Higher housing costs contribute to higher mortgages that contribute to higher default rates that contribute to higher unemployment that lower the sales tax revenue and the cycle goes on and on.
There are solutions that could curtail escalating increases in impact fees and encourage developers to provide more infrastructures such as parks and arterial roads, thus paying for growth. This can be accomplished through credits and offsets to developers. Some municipalities have adopted these practices with great success. Let’s look at what the Town of Marana did in one development to provide a park.
Through impact fees, the park would have cost the town $2 million to build. By allowing the developer to build the park during the grading phase of development, the same park was built by the developer for only $1 million. The town credited the developer the $2 million it would have cost the town towards the development impact fees. This is certainly a win for the town, the developer and the residents that will utilize the park. By the way, Marana has the highest impact fees in the region, if not for credits and offsets, development would not be happening at the rate it is in Marana.
Another method to finance infrastructure is for the municipalities to utilize the practice of Community Facilities Districts. CFDs fund infrastructure by the government issuing bonds, which are repaid through revenues collected on special assessments on all developed property in the district. CFD bonds are tax-exempt, but are not always guaranteed by the municipality. Developers must often guarantee the bonds and limitations are often imposed on how debt can be issued. Developers and municipalities benefit by lower housing costs and complete infrastructure funding. Lower costs for housing more than offset the additional assessment to repay the bonds. Many cities in Arizona have the mechanism for CFDs; however, political pressure from no-growth advocates often discourage elected officials from utilizing this tried and proven method for funding infrastructure in both new developments and blighted economic-development areas.
Recently the City of Tucson entertained the notion that adding a voluntary Real Estate Transfer tax could be used to pay for lower-income people to buy homes. The Tucson Metropolitan Chamber of Commerce, Tucson Association of Realtors and the Southern Arizona Home Builders Association, Arizona Builders Alliance, Metropolitan Pima Alliance and other advocacy groups strongly opposed such an approach to affordable housing. Like development impact fees, a transfer tax will contribute proportionally to the increased cost of housing by causing sellers to raise the sale price to pay for this ill-conceived tax scheme. Voters overwhelmingly passed Proposition 100 banning such transfer taxes. Curious how Tucson City plans to circumvent the State Constitution that now prohibits a Real Estate Transfer Tax.
Pima County has backed off, at least for now, to double the County’s impact fees. TMCC President and CEO Jack Camper issued a press release that illustrated the impact such an increase would do to decrease the ability for Pima County residents to afford a new home. Camper said ”With the county proposing an increase from $4,000 to more than $8,000 in impact fees per unit built, it would mean that more than 4,000 households could no longer afford a home.” This statistic is backed by several case studies.
Last legislative session, home builders and other stakeholders drafted legislation that would have grandfathered impact-fee increases for two years and addressed credits and offsets, got it passed through both the House and Senate, only to have the bill vetoed by Governor Napolitano. This year there may be legislation that promotes fairness in regards to impact fees and methods to reduce the cost of housing caused by excessive fees. Affordable housing is of most importance to us, our families, our employees and future generations.
By Paul Parisi
Before 1992, development impact fees were not allowed in Arizona. That year the legislature passed a bill that enabled cities and towns to enact these fees. The 1999 Growing Smarter legislation enabled counties the ability to impose development impact fees.
Before the 1990s, growth in Arizona actually paid for itself. This is evidenced by the fact that property taxes were low, home prices were affordable compared to most other states and local, county and state governments were providing all necessary services. Affordable housing encouraged companies of all sizes to locate in Arizona where their employees could experience the American dream of home ownership. Job growth provided a healthy sales tax base that allowed government to pay for public safety, roads, parks, sewer treatment, water and other amenities.
Since the introduction of development impact fees, the size and cost of government have grown disproportionably to the increase in population. Government entities have spent a considerable portion of impact fee revenue for expensive studies to justify escalating fee increases. Additional government staff has been hired to administer the complex formulas to distribute funds for projects within the impact fee boundaries. Bureaucrats and politicians have developed an insatiable appetite for projects that far exceed revenues. Most importantly, affordable housing for the common working person has diminished.
Everyone knows that impact fees are not paid for by the developers and home builders. We the consumers pay these fees in the form of higher housing costs. When this occurs, fewer individuals qualify for mortgages, fewer new homes are built, fewer workers are hired in the construction and related industries, fewer commissions are paid to real estate agents and fewer taxes are paid to the government. Just look at our state and local government budget deficit that has a direct correlation to the decline of the housing industry. Higher housing costs contribute to higher mortgages that contribute to higher default rates that contribute to higher unemployment that lower the sales tax revenue and the cycle goes on and on.
There are solutions that could curtail escalating increases in impact fees and encourage developers to provide more infrastructures such as parks and arterial roads, thus paying for growth. This can be accomplished through credits and offsets to developers. Some municipalities have adopted these practices with great success. Let’s look at what the Town of Marana did in one development to provide a park.
Through impact fees, the park would have cost the town $2 million to build. By allowing the developer to build the park during the grading phase of development, the same park was built by the developer for only $1 million. The town credited the developer the $2 million it would have cost the town towards the development impact fees. This is certainly a win for the town, the developer and the residents that will utilize the park. By the way, Marana has the highest impact fees in the region, if not for credits and offsets, development would not be happening at the rate it is in Marana.
Another method to finance infrastructure is for the municipalities to utilize the practice of Community Facilities Districts. CFDs fund infrastructure by the government issuing bonds, which are repaid through revenues collected on special assessments on all developed property in the district. CFD bonds are tax-exempt, but are not always guaranteed by the municipality. Developers must often guarantee the bonds and limitations are often imposed on how debt can be issued. Developers and municipalities benefit by lower housing costs and complete infrastructure funding. Lower costs for housing more than offset the additional assessment to repay the bonds. Many cities in Arizona have the mechanism for CFDs; however, political pressure from no-growth advocates often discourage elected officials from utilizing this tried and proven method for funding infrastructure in both new developments and blighted economic-development areas.
Recently the City of Tucson entertained the notion that adding a voluntary Real Estate Transfer tax could be used to pay for lower-income people to buy homes. The Tucson Metropolitan Chamber of Commerce, Tucson Association of Realtors and the Southern Arizona Home Builders Association, Arizona Builders Alliance, Metropolitan Pima Alliance and other advocacy groups strongly opposed such an approach to affordable housing. Like development impact fees, a transfer tax will contribute proportionally to the increased cost of housing by causing sellers to raise the sale price to pay for this ill-conceived tax scheme. Voters overwhelmingly passed Proposition 100 banning such transfer taxes. Curious how Tucson City plans to circumvent the State Constitution that now prohibits a Real Estate Transfer Tax.
Pima County has backed off, at least for now, to double the County’s impact fees. TMCC President and CEO Jack Camper issued a press release that illustrated the impact such an increase would do to decrease the ability for Pima County residents to afford a new home. Camper said ”With the county proposing an increase from $4,000 to more than $8,000 in impact fees per unit built, it would mean that more than 4,000 households could no longer afford a home.” This statistic is backed by several case studies.
Last legislative session, home builders and other stakeholders drafted legislation that would have grandfathered impact-fee increases for two years and addressed credits and offsets, got it passed through both the House and Senate, only to have the bill vetoed by Governor Napolitano. This year there may be legislation that promotes fairness in regards to impact fees and methods to reduce the cost of housing caused by excessive fees. Affordable housing is of most importance to us, our families, our employees and future generations.
Monday, October 20, 2008
Be careful what you ask for
By Paul Parisi
I am writing this story before the November 4, 2008 election. The outcome from this election might very well have been determined by a social experiment from the 1930’s in pre-Nazi Germany called the Frankfurt School. The Frankfurt School is a school of neo-Marxist theory that continues to this day. Much of today’s socialist agenda was derived from this early philosophy and has become much more main stream that pure Marxism.
After WW I there was a social battle in Europe between Capitalism, Socialism and Fascism. The author Heidi Swander wrote, “The socialists devised a plan that included creating enough chaos and confusion, dysfunction- a ferociously uncivil society- that the people will beg the state to come up with the answers. Once we have achieved that”, the group aspired, “we have our socialist utopia”.
Ask yourself this; have groups like ACORN and other community activists taken up the Marxist banner to cause the crisis in our country that has incited the American voters to ask the government to solve all their problems? Certainly legislation that forced banks to loan money to people who could not afford to repay has contributed to the current financial crisis. ACORN has encouraged many unwitting poor people to apply for such mortgages, only to have their homes foreclosed for non-payment. Rampant voter registration fraud has also been linked to ACORN.
Lets’ get this straight. Capitalism allows individuals to achieve prosperity with little government intervention. Socialism allows the government to control every aspect of commerce. You know, spread the wealth. Take from the rich and give to the undeserving. Now, do you really want the government to solve the problems with the economy? Do you really want the government to socially re-engineer society?
A new president takes office January 2009. How will he fix all the problems with the economy, protect our country from terrorism and attempt to solve the social woes of the poor? When we elect people with socialist tendencies to government, we are contributing to the socialist utopia that Karl Marx himself would be proud of.
By Paul Parisi
I am writing this story before the November 4, 2008 election. The outcome from this election might very well have been determined by a social experiment from the 1930’s in pre-Nazi Germany called the Frankfurt School. The Frankfurt School is a school of neo-Marxist theory that continues to this day. Much of today’s socialist agenda was derived from this early philosophy and has become much more main stream that pure Marxism.
After WW I there was a social battle in Europe between Capitalism, Socialism and Fascism. The author Heidi Swander wrote, “The socialists devised a plan that included creating enough chaos and confusion, dysfunction- a ferociously uncivil society- that the people will beg the state to come up with the answers. Once we have achieved that”, the group aspired, “we have our socialist utopia”.
Ask yourself this; have groups like ACORN and other community activists taken up the Marxist banner to cause the crisis in our country that has incited the American voters to ask the government to solve all their problems? Certainly legislation that forced banks to loan money to people who could not afford to repay has contributed to the current financial crisis. ACORN has encouraged many unwitting poor people to apply for such mortgages, only to have their homes foreclosed for non-payment. Rampant voter registration fraud has also been linked to ACORN.
Lets’ get this straight. Capitalism allows individuals to achieve prosperity with little government intervention. Socialism allows the government to control every aspect of commerce. You know, spread the wealth. Take from the rich and give to the undeserving. Now, do you really want the government to solve the problems with the economy? Do you really want the government to socially re-engineer society?
A new president takes office January 2009. How will he fix all the problems with the economy, protect our country from terrorism and attempt to solve the social woes of the poor? When we elect people with socialist tendencies to government, we are contributing to the socialist utopia that Karl Marx himself would be proud of.
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