Story One - Take a Peep at This
Our perceptive friends at Keystone Politics, have posted an observation about the latest embarrassment on the Philadelphia land-use front. Long story short, for years a patch of Market Street has been infested (literally and figuratively) by some low-rise, low-rent, low class buildings housing one of the few porno "palaces" left in Philadelphia. The anchor of the Keystone post is an article in the Philadelphia Inquirer by the redoubtable Inga Saffron, a long time booster of Philadelphia and mortal enemy of blight and bad design.
Well, all good things must come to an end, and the aging impresario of the Forum Theater Richard Basciano has decided to close shop and demolish the buildings much like his legendary holdings in the Times Square area of New York City in the 1970s and 1980s. In exchange for releasing a neighborhood held hostage by the likes of Show World, Basciano accepted $14 million to go away (to a leafy Maryland suburb, BTW).
Back in Philadelphia, Basciano realizes that the land underneath his Philadelphia theater is more valuable than the goings-on upstairs. Like most land speculators, he has been able to hold on to his empire of dirt for decades thanks to the ridiculously low property tax in Philadelphia, and the even more ridiculously low tax on blighted in vacant parcels, while productive citizens and businesses drown in wage and business taxes. A corollary is the see-no-evil attitude of much of Philadelphia's municipal government, which never saw fit to inspect, codify, and zone such junk out of existence.
Certainly, with a new assessment system and a somewhat muscular city zoning code,the opportunities for growth and development where they are meant to be have never been brighter. If the city provides valid land values and building values, a land value tax will help guide under-performing areas the city into the light, and protect the most vulnerable neighborhoods and citizens.
Story Two - The Grassy Knoll
For all of its salacious interest, this story is a piker compared to the experience two blocks away on the 1900 block of Market Street. This is a tale of two lots. 1900 Market St. is home to the gleaming Blue Cross building with nearly 80,000 square feet of business and jobs. The lot is 33,500 square feet. Thanks to private investment of labor and capital, this site has been a dramatic net positive for a city that needs all the investment it can get.
Next to it is what old Philadelphia reformers have referred to for 20 years as "the Grassy Knoll," a lot that is – you guessed it – 33,500 square feet. It has bounced back and forth between owners in that time for lots of money, a little less money and then a little more money. Now,it's in the hands of a powerful development firm Brandywine . We are told that THIS is the year a building will finally go up on the site. Given the slight turnaround of the real estate market, and the generous abatements provided by the city of Philadelphia, UrbanTools would not be shocked, just surprised.
During all this time, a lot worth a minimum of $9 million has paid just about $270,000 a year in property tax. Because the inhabitants are pigeons, worms and rats, the wage tax and business tax "take" from the lot is exactly $0. It's embarrassing, and somebody knows it.
Nothing to See Here!
In 2011, in an act of window dressing that would make Potemkin proud, the Philadelphia Horticultural Society installed a pop-up garden on the lot in order to delight and astound local citizens and provide fresh produce to charity. This "temporary oasis" (Don't some people call those mirages?), was funded by the aforementioned Brandywine, Blue Cross, and the William Penn foundation. At the end of 2011, the pop-up garden was pulled up and the depressing reality returned.
Making the desert bloom - for a couple of months
Philadelphia needs a land value tax to not only shed light on the underside of urban real estate gains, but also to uncover the PR and fluff that serve to hide the defects of our current tax and land-use systems that impose a real cost on the tax payers who are least likely to be able to pay for it. The story of these two lots is the Alpha and Omega of the private pocketing of economic rent that belongs to all citizens.