Wednesday, April 11, 2007

Border Guard Bob comes out of retirement

I suppose I have to comment on the new commission to keep young people in the City. First off, trends for the city are affected by some very different things than the region's population. It's just apples and oranges to talk about what is happening across the 7 or 10 counties we call the Pittsburgh region with the population trends within the City of Pittsburgh. A lot of people leaving the city proper are staying in the region, just moving to a suburban municipality near or far. But does the city have a problem keeping it's young people?? In fact, compared to the rest of the county, the city has been doing OK keeping young people. (see correction to these numbers in next post) In 2002 the census counted 68,047 people age 20-34 in the city. In 2005 that number was up ever so slightly to 69,005. Over the same period the county numbers for that age range are down from 225,874 to 205,569. Are we looking for the lost car keys where the street light shines?

But if anyone thinks the issue of young people leaving the city is something new, let's go through the history. Mayor Caliguiri had the Department of City Planning do a survey of residents who were leaving the city proper in the 1980's. I have the results of that survey scanned here:

The Impact of the Earned Income Tax on Locational Decisions and the City of Pittsburgh.
City of Pittsburgh Department of City Planning. April 1987
Actually I have it in pieces. Here is Part 2; Part3

There is no big surprise here. For those who left the city proper, but stayed in the region the answer was simple: taxes were pushing people out of the city. Here is the key quote from the study's conclusions:

Pittsburgh, sixty-five percent of former City residents who were surveyed identified taxes as a factor in their decision to move.
65%!!! Do we really need to study this question any more? It's not the lack of 24 hour coffee shops.. not housing or lack thereof... not all sorts of things that we talk about when it comes to keeping young people, and in particular young families who are planning for the long haul, from leaving the city. If someone can move literally a few blocks away away and save serious money in doing so, what is the mystery here? Seriously, read the study and ask yourself what question needs to be addressed. The question has been asked and answered as systematically and objectively as it can be.

Disproportionate taxation compared to what you can get just by living in a nearby municipality is the city's Achilles heel. The fact that the city of Pittsburgh is so small that our inner suburbs would be close enough to be city neighborhoods in most any other large city in the US. So you can essentially get all the city living you want, yet not have to live with city taxes.

But the history does not end there. It then turns out that this report was referenced by Mayor Masloff as the prime reason why there needed to be tax reform in the city. In particular she pushed the idea that the city's wage tax needed to be lowered in order to keep younger workers in the city. She advocated for a revenue neutral tax shift with a complementary higher property tax. In the end the wage tax did wind up getting lowered by 1.125 % points. Property taxes were never raised enough to really make up for the wage tax lost. In many ways that episode of trying to 'keep out young people from leaving' created the structural budget deficit in the city for the following decade and directly lead to the current fiscal miasma Downtown. Amazing how it all is tied together.

So if the new commission is to have any teeth and not just engage in cliches... maybe someone should update that survey? I certainly would like to know if the answers are the same. Barring that, what could be the answer? more cupcakes?

5 Comments:

Blogger Skip said...

Wow! Evidence-based practices to inform public policy. What a novel idea! Well, I would certainly agree that this survey should be updated. However, the methodology of the survey was designed to measure the impact of earned income tax on location decisions. And then they found that taxes impacted decisions.
How about designing a survey to ask college seniors or graduate students about whether they plan to stay in Pittsburgh after completing their studies? Why and why not? And ask them to identify some incentives that would keep them here. Like Peduto's attempt to commission an independent body to thoroughly investigate a feasibile and achievable tax-abatement plan instead of one based on political curb appeal. City govt could do well be re-employing such evidence-based practices.

Wednesday, April 11, 2007 8:49:00 PM  
Blogger Schultz said...

It's about jobs! Young people leave Pittsburgh because the jobs are in other areas - DC, Philly, NY/NJ. It has nothing to do with taxes - just ask all the young people living in Center City Philadelphia paying the 6% wage tax.

After finishing graduate school it was very tough for me to find a job here in Pittsburgh. Ditto for when I finished my bachelors at Duquesne back in 2000. I had to leave for DC because the local firms were not hiring many undergraduates.

There are a ton of jobs in DC for young people and there is no way for Pittsburgh to compete on that front - our best bet is to lure them back to the region once they've got a few years experience and are ready to buy a home.

Pittsburgh cannot compete on 'coolness' but we do have a lot more to offer in terms of restaurants and nightlife than we had back when I came here in 1996. It's also a lot easier to live here than it is in other metros - sitting in traffic on the beltway get old after a while and who wants to keep shelling out $2000 a month in rent? I didn't.

Wednesday, April 11, 2007 9:59:00 PM  
Blogger C. Briem said...

people keep confusing city issues with region issues. Each and every quote on this new commission says it is focused on the city of Pittsburgh. Jobs are indeed the prime motivator of migration in and out of the region.. but where people choose to live within the region is affected by a completely different set of factors. The city proper has retained plenty of jobs, and the best paying jobs in the region for that matter.... all while residents have continued to leave. Just not the same issues..

Thursday, April 12, 2007 12:20:00 AM  
Anonymous Anonymous said...

Why, in a city and region losing population, are attraction efforts so targeted? Does the city really need to be that picky? Broad tax policy may not be under consideration because it's hard to use for just "desirable" populations.

Thursday, April 12, 2007 11:39:00 AM  
Blogger EdHeath said...

I think people tend to focus on visible issues and ignore hidden ones as they make decisions. You trade the 3% city tax for a longer commute where you no longer use public transportation and have to pay for parking. Maybe. And that drives people out of the city. But I think some people, young couples, do have a view of the quality of suburban schools versus city schools, and make decisions based on that.

Thursday, April 12, 2007 10:47:00 PM  

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