|Iowa's Economic Development Efforts Should Start at Home|
Cedar Rapids Gazette
February 17, 2008
By Todd Dorman
Iowa’s economic development efforts should start at home
When Internet giant Google cast its gaze on Iowa last year, the Legislature swooned. And this week, when Microsoft showed interest in building a data center here, lawmakers sprinted to its aid in record time.
I suppose you can’t blame them for jumping to create a few high-tech jobs in the interest of plugging the brain drain.
But where I take issue is that while legislators chase every “next big thing,” the state’s big cities, arguably the real engines of economic growth in Iowa, are left to fight for table scraps.
I sat down with Cedar Rapids City Manager Jim Prosser last month and heard his pitch for healthier cities.
Iowa’s metro areas are where most of the next generation of jobs will be created, he argues. The fight to convince people to stay here or come here goes hand-in-hand with the struggle to make Iowa’s city’s vibrant and attractive. Winning takes money.
But cities shackled by a stone-age property tax system don’t have a fighting chance.
He wants lawmakers to allow cities to mine new revenue sources to reduce reliance on property taxes. Most growing Midwestern metros have those options.
Prosser says cities need the power to levy local taxes on cigarettes, liquor and food.
They should be able to tax utilities, cell phones and real estate transfers.
Also, developers should pay an “impact fee” to cover infrastructure costs.
It’s pretty straightforward — take the pressure off property taxes by taxing other things.
Popular? Maybe not.
But at the Statehouse, only the lines for free food are straightforward.
Rep. Tyler Olson, D-Cedar Rapids, has a bill that would let cities try some of Prosser’s ideas, but only if they agree to cut costs, embrace efficiencies, adopt smart-growth policies and use new revenues to cut property taxes.
Olson couldn’t tell me what options from Prosser’s list will be in his bill. He’s not quite ready to take the public plunge.
And his bill is no slam dunk. City budget woes may be a hot issue in town halls across Iowa, but it’s on the back burner under the dome.
Sen. Joe Bolkcom, D-Iowa City, chairman of the tax-writing Ways and Means Committee, is like a lot of lawmakers I talked to.
He thinks the city’s issues must be addressed only within a massive effort to reform Iowa’s property tax system.
That won’t happen until next year. And you could argue, based on history, that it will never happen.
Therease Harms-Hassoun, who lobbies for the new Metropolitan Coalition, formed by Iowa’s largest cities, says Olson’s bill has a chance in the House, where urban lawmakers have a bigger say.
Dave Roederer, who lobbies for the Iowa Chamber Alliance, a group of urban chambers of commerce, said his members are interested, but only if cities use every dollar in new revenues for commercial property tax relief. The League of Cities didn’t return my phone calls.
I should have checked with the tour guides, cafeteria cooks and marble polishers.
Everybody at the Statehouse has an opinion. Each is as good as the next.
If I had to make a prediction, I’d say cities will get a little attention and almost no help.
Maybe they should call Bill Gates. He knows how to get some action around here.
Contact the writer at (319) 398-8452 or firstname.lastname@example.org
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