Farewell. The Flying Pig Has Left The Building.

Steve Hynd, August 16, 2012

After four years on the Typepad site, eight years total blogging, Newshoggers is closing it's doors today. We've been coasting the last year or so, with many of us moving on to bigger projects (Hey, Eric!) or simply running out of blogging enthusiasm, and it's time to give the old flying pig a rest.

We've done okay over those eight years, although never being quite PC enough to gain wider acceptance from the partisan "party right or wrong" crowds. We like to think we moved political conversations a little, on the ever-present wish to rush to war with Iran, on the need for a real Left that isn't licking corporatist Dem boots every cycle, on America's foreign misadventures in Afghanistan and Iraq. We like to think we made a small difference while writing under that flying pig banner. We did pretty good for a bunch with no ties to big-party apparatuses or think tanks.

Those eight years of blogging will still exist. Because we're ending this typepad account, we've been archiving the typepad blog here. And the original blogger archive is still here. There will still be new content from the old 'hoggers crew too. Ron writes for The Moderate Voice, I post at The Agonist and Eric Martin's lucid foreign policy thoughts can be read at Democracy Arsenal.

I'd like to thank all our regular commenters, readers and the other bloggers who regularly linked to our posts over the years to agree or disagree. You all made writing for 'hoggers an amazingly fun and stimulating experience.

Thank you very much.

Note: This is an archive copy of Newshoggers. Most of the pictures are gone but the words are all here. There may be some occasional new content, John may do some posts and Ron will cross post some of his contributions to The Moderate Voice so check back.


Thursday, June 7, 2012

Property value heterogeneity and taxation

By Dave Anderson:

For every problem, there exists a simple and elegant solution which is absolutely wrong.

One of the big and stupid political food fights locally is the re-assessment of property values in Allegheny County.  These assessments were ordered by the local courts because the Pennsylvania state constitution mandates "uniform" taxation.  The judge ruled that the divergent value change rates between properties in the communities that make up Allegheny County since the last assessment led to de facto non-uniform tax rates.  Communities and home owners whose property values either lost market value or gained market value at a lower rate than county average gain rates are paying a de facto much higher tax rate on their property than individuals whose property has gained value at a faster than average rate.  Frequent reassessment minimizes the differential between de jure tax rates and actual fair market value tax rates. 

The County hired a firm to do the reassessments and the reassessment  has been a political football as it threatens to raise taxes on politically influential constituencies while lowering taxes on poor(er) communities and individuals.  The reassessment has cost the county $11 million dollars to develop the model and to get the baseline data. 

More and more people in the peanut gallery think that they have a simple, elegant and far cheaper solution.  That "solution" would be to have temps look at the recent sales prices of homes in a given community, take the price and divide the price by square footage. Do that for all recent sales, and voila, that is the average price per square foot in a borough.  Apply that number to each housing unit in the town, and all of a sudden, there is no need for a complicated forumala, expensive data collection, complex models or anything else complicated. 

The solution is simple, easy and elegant. It also makes the original injury that led to the lawsuit which has resulted in the court ordered re-assessment look like a minor flesh wound. 

Let's look at a real world situation.  The neighborhood of Garfield is in the city's East End.  It is also one of the poorest and most rapidly depopulating neighborhoods in the state.  The housing stock ranges from mediocre pre-war rowhouses, to should be condemened shells, and then Hope-6 public housing.  One can buy a small rowhouse for $10,000 (no, I am not missing a zero) in Garfield. 

At the same time, staying in the city, and just going a mile south, that same row house in the same condition will cost a buyer $175,000 in Shadyside off Ellsworth Street. The Shadyside purchaser is paying for proximity and neighborhood externalities. 

Taking an average between these two neighborhoods will lead to the Shadyside owner being assessed at slightly more than half fair market value, while the Garfield owner would see his assessment be 9 times his fair market value. 

This is an extreme example, but it shows that communities have high local variability in property values and simple solutions are not good solutions.  Complex and expensive approaches are sometimes the only way to actually make a problem tractable. 


1 comment:

  1. They are building houses here again - the wrong houses. A family with one or two children does not need a 4 or 5 thousand a square foot house but that's what they are building. Even if they use the greenist of building construction the house is still not green. It still takes more to build, heat and cool it. My wife and I raised two sons in a 3 bedroom 1500 square foot house and we had a good life. Homes are like cars - the bigger they are the more profit there is to be made.