"Property Tax Assessment Appeal Patterns During Housing Booms and Busts."
Assessors establish a value for all properties subject to property taxation, and property tax appeals serve as a check against assessors’ errors. In practice, though, not everyone can take advantage of appeals, which can exacerbate inequities. Therefore, extending our understanding of appeals will aid in improving property tax administration. With that in mind, I investigate a link between appeal rates and house prices. I hypothesize that appeal rates and house prices move in opposite directions because assessments do not keep pace with the market, favoring taxpayers when prices rise and disadvantaging them when prices fall. Using a new dataset of the number of appeals for many US counties over 2000-2018, I indeed find an inverse relationship between local-level appeal rates and house prices, along with evidence that the change in the assessment-market value ratio drives this relationship. Consequently, efforts to improve assessment timeliness may pay off in the form of lower appeal rates.
State and local OPEB liabilities are particularly high in New York making it a near worst-case scenario for assessing the fiscal sustainability of funding OPEB on a pay-as-you-go basis. We examine spending on retiree health care as a percentage of revenues for a sample of New York State school districts. The fiscal burden of these benefits grew from 3.4 to 4.3 percent between 2010 and 2021. Assuming CBO forecasts regarding growth in health care costs and continuation of recent trends in revenue growth, we project that the burden of retiree health care benefits will exceed 9 percent of revenue by 2040 before leveling off from 2040 to 2050. Projected burdens are greatest in big city districts raising educational equity concerns. We examine pre-funding as one possible policy response.
This study examines the link between the pace of utilizing the awarded intergovernmental grants and the administrative capacity of recipient government organizations. Past research focused on the relationship between higher administrative capacity and obtaining grants. However, there is a lack of attention to how capacity affects grant funds utilization, which is critical for achieving societal impact. To address this issue, the study analyzes the Coronavirus Relief Fund (CRF) established by the CARES Act to aid state and local governments with COVID-19-related expenses. The study justifies and performs multiple regression analyses using data from various sources, including the U.S. Department of the Treasury, the U.S. Census Annual Survey of Public Employment and Payroll, and the Government Finance Officers Association. The study discovered that financial administrative capacity was positively linked to the proportion of funds spent early in the CRF program rollout, a finding that withstood scrutiny when employing various measures of administrative capacity. However, the connection between capacity and spending tapered off toward the end of the program rollout, potentially due to workload stabilization, increased program clarity from the federal government, capacity-building by recipients, and the use of external experts. The findings of this study carry significant implications for both research and practice, underlining the necessity of studying the implementation stage of government grant programs and investing in building administrative capacity within recipient organizations.
What is the effect of e-commerce on the geographic distribution of local sales tax revenues? Using COVID-19 as a shock to online shopping and hand-collected high-frequency data on local sales tax revenue, we document an important shift in the state and local public finance landscape. As e-commerce increases, a destination basis for remote sales taxes results in higher growth in local sales tax collections in smaller, generally more rural jurisdictions. This increase comes at the expense of larger urban retail centers, which previously enjoyed an origin basis for sales tax collections. As households replace in-person commerce with online shopping, sales taxes no longer accrue to urban centers with large concentrations of retail establishments and instead expand the tax base of smaller jurisdictions. State-level reforms that enforce sales compliance generally mitigate the revenue falls in larger jurisdictions and amplify the increases in smaller jurisdictions.
Adverse effects of the opioid crisis on individuals influence the need for state and local government expenditures and erode their tax bases. Systematic estimates of the magnitude of such fiscal impacts are lacking. We estimate the magnitude of the effect of the opioid crisis on state and local expenditures and discuss approaches that might be taken to evaluate the impact of the crisis on revenues. We find that the fiscal impacts of the opioid crisis on state and local governments are modest for the U.S. as a whole but are likely to be greater in states with particularly high rates of opioid-use disorders. Our analysis aims to encourage and guide more in-depth studies in the future. Such studies can inform intergovernmental aid policies designed to offset the fiscal impacts of opioid misuse and can also contribute to assessing damages in opioid lawsuits.
Policy makers utilize various place-based interventions to reduce spatial inequality. In particular, there has been increasing attention to supporting small businesses in distressed places, but the lack of evidence makes it difficult to justify these public investments. The author investigates the Neighborhood Opportunity Fund (NOF), which has been providing grants for physical improvements to businesses in a low-income part of Chicago since 2017. Event studies are used to quantify the program's impacts on new business licenses, jobs, building permits, the commercial real estate market, and crime. The NOF increased construction and remodeling activity and decreased narcotics crimes around establishments receiving grants. Under some circumstances, it led to new business formation and increased demand for real estate. However, no evidence was found of a relationship between the NOF and jobs or total crimes in the larger area. This study is the first step to understanding how place-based small-business support programs affect neighborhoods.
There is a substantial body of literature regarding the effects of administrative burdens on the take-up of safety-net programs and the role of organized groups in this process. I investigate similar issues in the context of property tax assessment appeals. Disadvantaged groups spend well over the recommended 30% of their income on housing costs that include property tax, and, on top of that, assessors often overestimate lower-value properties. Appeals may provide some relief, but the process can be burdensome. Certain localities give condominium associations the right to file one joint appeal on behalf of all unit owners. I hypothesize that this rule reduces burdens for condominium units and causes them to appeal more frequently than houses, resulting in a distributive effect that depends on the local context. I present supporting evidence from two case studies in two locations: New York City, which allows joint appeals, and Allegheny County, Pennsylvania (Pittsburgh and surroundings), which does not. Thus, while administrative burdens can span diverse contexts, engaging a third party to assist potential beneficiaries consistently increases the take-up.