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Editor’s Note: The following opinion column was submitted by Joseph Wetmore, owner of Autumn Leaves Used Books, a business located on the Ithaca Commons. Subheadings have been added for ease of reading.
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The story, “The fight over tax breaks for Ithaca developers: A beginner’s guide” had some omissions and errors.
In the section labeled “Okay, but are tax abatements really needed?,” you quote Cynthia exclusively on this point:
Alderperson Cynthia Brock suggested that the lack of development seen before the revised CIITAP program kicked in could be attributed to the economic crash circa 2008.
Brock referred to CIITAP as a “blunt tool” and suggested that “just because we created this thing doesn’t mean we have to keep looking at it.”
Her focus on the 2008 period ignores the larger time-line. If you look at the last 40 years of downtown, the only new buildings built in Downtown Ithaca have had tax abatements; nothing has been built without some kind of abatement.
The longer time-line shows a stronger correlation between tax abatements and downtown construction than tax abatements and the health of the economy. Economic crash, or boom, nothing has been built without abatements. She focuses on this one time period and gives no evidence to show that the two events are connected.
Further, you quote her as saying, “the idea that development would itself create jobs had not panned out”. While one of the the indirect goals of The Community Investment Incentive Tax Abatement Program (CIITAP) is job creation, it is not direct the goal of this program. The goals, as written on the city’s website, are:
■ Strengthen and enhance the City of Ithaca’s downtown area as the urban center of the county.
■ Increase the amount and density of housing and business space in the central business districts throughout the county.
■ Promote greater density by encouraging development of existing ‘gaps’ left by abandoned buildings and vacant parcels.
If these goals are achieved, the goals of greater employment will also be achieved. These specific goals mentioned on the city’s website are not discussed at all in your article, which is a major omission.
“Growth is, and will continue to, happen”
In the section labeled “Why is development downtown so important?,” you missed the main issue. The reason the county and city’s comprehensive plans call for density in the downtown is because we cannot control whether or not development/growth is going to happen in our region.
Growth is, and will continue to, happen. While we cannot stop growth in our community, we can control is where it is focused. The whole point of the City’s CIITAP program is use the tools that the city has in its control to encourage development in the urban core rather than in the cornfields of Lansing and Newfield.
Further, we, as a community, simply cannot afford to build more sprawl. There are a number of reasons but I will give just one example: TCAT. Downtown has an excellent bus network, with buses coming and going to all parts of the area.
Nowhere else in Tompkins County has such coverage. Collegetown is a close second, there is not a close third. TCAT is watching its expenses rise, while its funding is either being cut (see Town of Ithaca) or is static. Growth of the network is impossible under these circumstances.
There is no way for TCAT to grow its network to service these outlying communities to the degree downtown is serviced. And nobody is willing to put up the money to make that growth happen. If we keep growing the populations of the suburbs we end up paying to expand TCAT, or building more or larger roads. We can’t afford either option.
If the growth of the region is focused on the urban core, like downtown or collegetown, the infrastructure for that new population is already in place. We as a community have already paid for it, and will not need to pay that bill again.
The goals of the program
In the section labeled, “What are the problems with tax abatement?,” you say “Put simply: they give too much to developers without giving enough back to the community.” This makes no sense when compared to the goals of the program. The community is giving an abatement so that it can get development in the urban core. This is a major objective, and is currently only being accomplished by tax abatements.
The community has many other great goals that keep being brought up with the abatement program:
– use of local labor, thus keeping money circulating within the community
– considerations of sustainability and environmentally-friendly design elements
– creation businesses that provide living wage jobs
– consideration for diversity among workers
These are all wonderful goals, but the unstated assumption is that adjusting the tax abatement program is the best way to achieve them. Consider that the abatement program is only 2% of the construction in the county. Do these other goals not have value on the other 98% of the construction?
For example, if “considerations of sustainability and environmentally-friendly design elements” are important, and I agree they are, why not make them mandatory throughout the city?
Where is the discussion about “considerations of sustainability and environmentally-friendly design elements” of the other 98% of construction that is going on in our community? The city has the authority to amend the building code so that everyone has to utilize green building techniques.
The point is that while these are great goals; attaching them to projects asking for abatements is unlikely to be more than a minor step towards achieving them on any kind of significant scale.
As you add more goals to this specific program, the more likely that none of the goals will be met. Each of these goals come with a cost. Add enough costs to a project, and your requirements end up making the project more expensive than if the developer skips the abatement project all together.
Since developers are looking for abatements to make a project bankable, these added requirements simply stop any new downtown projects all together. And this is exactly what we have experienced — in the years when more goals are added to the tax abatement program, no new construction is proposed, let alone built, for downtown (but it keeps being built in the surrounding towns).
“Any new housing helps”
Regarding the section labeled, “Can abatement help with the housing crisis?”: the housing crisis can only be fixed when supply is slightly more than demand. Ithaca has a 0.5% vacancy rate. We need to build enough housing to change that to about a 5% vacancy rate (which is want is considered a healthy rate of vacancy).
If the abatement program can encourage the building of enough housing to meet that gap, then yes, it will help with the program. Even if it only builds high income housing (and I hate to see segregated housing like this being built) it will still open up lower income housing in the community as tenants move from where they are currently to the newer apartments. In other words, all new housing will help ease the housing shortage.