The Observation Deck

Another late-comer's response:

Lakewood's challenge is to become a viable, competitive choice for businesses and middle-income residents to move in. It's tricky because this is not just a local challenge: we're caught in regional and global trends, many of which we can't control.

In the short-term, we need get City finances in order. This probably means tough, unpopular choices.

In the mid-term, we need to spruce up Main Street commerce--so visitors and residents perceive Lakewood as a clean, beautiful, pleasant place to shop.

In the long-term, we need to make Lakewood the *easiest* place to do business. We do that by cutting red tape and bringing government into the Broadband Age. Every time business touches government, it should be online, with one-stop-shopping, paperless records, and customer-friendly "how to file this form" instructions. This will achieve a quantum leap forward in efficiency that will contain costs and make Lakewood
more attractive.

Throughout the short-, mid-, and long-term, we play Lakewood's trump card: our huge community spirit, our authentic neighborliness, our delight in and love of our city. That's contagious.

Bill Call wrote:

Joan Roberts wrote:The fact remains, and you cant rationalize it away, that to maintain a quality school system and city services with no economic base, Lakewood places an ever greater burden on its individual residents. The fact that there has only been one tax "revolt" in the past 20 years speaks highly of the residents here. But there is no doubt the tax burden has taken its toll.

If you cannot raise taxes and will not consider cuts in pay and benefits for City employees where does that leave you?

Doesn't it leave us with finding a way to increase the commercial contribution to property taxes?

Sure it may be overly simple but I would rather have a business pay it than expect homeowners to continue carried the weight. I figure that to decrease the homeowners taxes from 2.7% to 2.2% (which is halfway to the rate in Elyria), we need to draw $120 Million in new property (which includes equipment and inventory not just the building) to Lakewood. Not totally clear on the rates that businesses pay as opposed to residents but I calculated this on the 1.8% that seemed to keep coming up on the Auditor website.

Of course this doesn't count the income tax that $120 million in new commercial property would generate. So really to maintain the same budget we would probably need far less. The good news is that businesses don't bring kids that need to be schooled so the expenses won't increase commensurate to the income. Depending on the business hopefully we can chose wisely to limit the increase in other services like garbage collection (BFI not city) and emergency services.

A second option is that we, the homeowners pick up the slack for lost businesses such as Tops or Delorean. Considering how much we need to do it really makes the money provided to the Main Street program seem trivial.

Please note that I never mentioned franchises or malls just commercial property that we can tax.

I'm confused Shawn, in other posts, you want more business and your idea to attract them is to charge them more tax? Doesn't compute.

Ohio already has one of the highest tax rates and business are fleeing the state. The way cities are attracting business here is with Tax abatements, TIFs, or forgiveable loans. None of these bring in much more money. They are hoping for jobs. Business that don't get them are outsourcing to lesser cost states or out of this country altogether.

Jim's idea of condos which increase property tax and income tax is good. The pennisula idea actually grows Lakewood and brings in more high end property tax and income tax. Focusing on sustainable energy reduces our costs in future years and the cost of energy seems to keep going up. Wind and Sun are free. Councilman Butler at one time suggested using our trash as a fuel to make energy. These types of creative ideas are what we need.

Businesses can not stand any more tax. The commercial property tax rate is already higher than residential - and those taxes are passed on to the businesses that occupy those locations. We need to be more creative than just to figure out who else to tax.

JMHO

Ms. Farris.

Yes, but there ARE businesses locating in Ohio, high taxes and all. They're locating in Solon, Westlake, suburban Columbus, suburban Cincinnati. the numbers aren't pretty to be sure, but there is an economic engine. Lakewood just isn't getting its piece of the action, because it apparently doesn't think it's important.

Ohio is phasing out the personal property tax, which is a good thing for manufacturing and distribution.

Again, as Mr. Juris is saying, the problem with a 100 percent residential based economy is that you're basically putting a double tax whammy on every resident who chooses to live here. You pay the income tax, you pay the property tax. And for good measure, if you have to work OUTSIDE Lakewood (as most of us do) you have to pay the OTHER city's income tax, too. So maybe it's a TRIPLE whammy.

While Lakewoodites help pther cities via the income taxes we pay, without employees and outside investment, we shoulder the entire burden ourselves

As I said a long time ago, it's a city, not a condo association. We can't hope to generate more than $120 million in public expenses on the backs of 55,000 (and dropping) residents.

Again, since many of the posters here are fairly high profile in the community, it's easy to know it's a disproportionately liberal and affluent group. You (collectively) really need to look at how more conservative and less well-heeled folks think about the taxes they have to pay for the privilege of living here

Joan Roberts wrote:While Lakewoodites help pther cities via the income taxes we pay, without employees and outside investment, we shoulder the entire burden ourselves

Joan

Let's not forget that Lakewood benefits from the county sales tax, without having any of the myriad of problems to the city that comes from the mall.



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Shawn Juris wrote:Doesn't it leave us with finding a way to increase the commercial contribution to property taxes?

If the City added 2,000 jobs paying $50,000 per year the City would collect 1.5 million dollars in income taxes. That would be enough to pay for one year of wage increases for City employees. I think we all know the City will never add 2,000 jobs a year. If we added 200 jobs a year we should consider ourselves very lucky.

I agree that commercial development can be part of the solution but it is not the solution. Unless we are willing to deal with the cost of pay and benefits for City employees we are looking at a dangerous financial future for the City.

To avoid financial reality the City has spent all the City's reserves and maximized our debt load. At the end of this year the City will have no cash and no borrowing authority. Is that anyway to run a City?

Bill you said:

If the City added 2,000 jobs paying $50,000 per year the City would collect 1.5 million dollars in income taxes. That would be enough to pay for one year of wage increases for City employees. I think we all know the City will never add 2,000 jobs a year. If we added 200 jobs a year we should consider ourselves very lucky.

and Joan you said:

Yes, but there ARE businesses locating in Ohio, high taxes and all. They're locating in Solon, Westlake, suburban Columbus, suburban Cincinnati. the numbers aren't pretty to be sure, but there is an economic engine. Lakewood just isn't getting its piece of the action, because it apparently doesn't think it's important.

The jobs that are often discussed are in the retail business. These rarely pay more than minimum wage and have few benefits - like health care. Additionally, they don't generate much in terms of income tax dollars and property tax abatements of some sort are often involved in bringing them here - or Westlake etc. The sales tax dollars - which are significant are realized by the county as Jim said. I'm not against more retail - I just don't think it will be the "savior" of the city.

I do think we should concentrate on jobs - living wage jobs in Lakewood. I have advocated for a long time, making Lakewood an economic incubator for small businesses. This is the group creating the most jobs in America right now. We have lots of small office and store fronts that can be filled. I do think Sustainability is a growth market - one of the few in which Lakewood could capitalize.

That will take some time. In the short run, financial discipline as Bill suggests as well as some PR to bring more people into the city to live in the vacant rentals and homes would be a good step.

For what it's worth I never suggested charging businesses more in property tax, just increasing the volume of it with new business. Also, I hadn't really even considered the income tax impact of these new job since my goal was to find a breakpoint to lower my property taxes as a homeowner. Give me a mayoral candidate that offers this solution and can back it up and you'll see some changes.

Nice to get a taste of how difficult it must be to move things forward when there always seems to be something negative or just not good enough. To avoid being a hypocrite though can I get an explanation of what is meant by becoming a Chatauqua. While I haven't been so fortunate as to visit, I was under the impression that it was a vacation destination for the well to do from the east coast and midwest. Is there a high level of vacancies of our homes on Lake that we're planning to make seasonal?

Is there a high level of vacancies of our homes on Lake that we're planning to make seasonal?

As a side light....many of the Clifton Park homes were originally summer homes for Eastside robber barons.....

Jeff

Shawn Juris wrote:Also, I hadn't really even considered the income tax impact of these new job since my goal was to find a breakpoint to lower my property taxes as a homeowner. Give me a mayoral candidate that offers this solution and can back it up and you'll see some changes.

To avoid being a hypocrite though can I get an explanation of what is meant by becoming a Chatauqua.

Shawn

Your taxes will never go down. With the possible exception of finding oil, and us becoming the new Kuwait, I would forget the concept of lower taxes. If we look at every suburb in the area, they are trying to raise their taxes as we input.

When I mention Chautauqua, I also mention Berkley of the early 60s. I see Lakewood as a quiet, but solid area of energized thinkers, doers, artists, musicians and entrepreneurs. A place that has the brand for being on the cutting edge of relaxation, fun, good living, and security. I do not see it as vacation land, I do see it as the ultimate place to incubate ideas, businesses, concepts, and life at a very affordable rate.

For what it is worth the VAL is working better than thought. The brand is being built at a very incredible rate. Yesterday I got a call from a person that read in an airline magazine that "Lakewood Ohio" is the new hotspot, the new Tremont, the new cool place to set up shop. I asked for the name and more info.

But if you go online, the Observer and others are building the brand, faster than any ad campaign could. It is working, it would just be so much better to have more onboard.


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Thanks for that Jeff.

Jim, The idea of making an effort to lower taxes is out of the question but recreating Lakewood as Berkeley or Chatauqua is considered within reason? What evidence is this based on? Forgive me but it seems out there. While I've often asked why NEO hasn't become more of a tourist spot based on the natural risks of our ocean's coasts, you're loosing me with the viability of a town full of freethinkers, artists and musicians. I've often been mislabeled a liberal but goodness I feel like I'm freakin' Bill O'Reily after hearing this proposal. I'll stop before I go too far.

Shawn

Taxes - I a country with diminishing work, and payroll, in a region that has similar problems how do you see taxes being lowered and by what rate? Does $100 a year make Lakewood livable?

It is certainly more complicated than that.

But when you add in the surrounding area, the Berkley model becomes much easier to understand. Much of this as I have said to you is too complicated for sound bites. But is the city more livable if it is filled with renters and homeowners? Does the city become better off financially with the 56,000 that used to live here, or are we better off dumping another 10,000 off and go for the mall?

Maybe it is my background, maybe my warped thought process. But I would be very happy with a city full of graphic designers making between $24,000 and $300,000 a year. That would be easier than getting taxes lowered. Bring in the businesses that support that group, and they will come. What you have to do is let go of all of your preconceived notions, and take a fresh look at how to live. However I am not looking for an area filled with Graphic Designers.

Lakewood is 80% where it needs to be for the non industrial side to kick in. Certainly that is closer to our grasp. The flip side is, if my ideas do not work, the city is still better for all. If the industrial malls do not work, the city is gutted forever. Which makes more sense to try first?

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I'll chime in:

On Taxes: my hunch is Jim is correct--any tax cut would be symbolic ($50-$300) at best. But we could HOLD THE LINE on taxes if we make painful choices (i.e. cuts), which would bail us out of a structural deficit and establish a capital budget to turn the corner on streets, storm sewers, and other infrastructure.

On Funding City Redevelopment: we'll have to tighten the belt futher AND enlist outside help (from Columbus, Washington, and Foundations). This can be done (I used to do it professionally) but only for sound, well-planned, and deserving projects led and significantly funded by the City.

On Lakewood as a Hotspot of Innovation: I'm new (just celebrating two years here), and with my fresh set of eyes/ears, I'd say this is legit. I looked around the Greater Cleveland area, and Lakewood felt most like "home" to me. It has the layout, energy, diversity, creativity, citizen engagement, neighborliness, and ample supply of unique stores to make it THE bubbling cauldron of innovation. Tremont, Ohio City, and University Circle can all make a bid, too--but they are islands, not full-fledged communities.

Lakewood's the real deal.

As long as we're all in agreement and focused on specifics, let me add this to the mix.....

We have all these great attractions and amenities, the Lake, the Park, the emerald canyon.....you would think that a great old Tudor up on Riverside would make a great B&B for fall foliage watching.....or one of those Clifton Park lakefronts, breakfast overlooking the lake, perhaps a stroll down to Clifton Beach. Tourism could work, ala Chatauqua. Don't think zoning would allow it, and doubt that anyone incouncil would push for it...

Jeff

The Chautauqua Institution revolves around a summer-long season of lectures, discussions, spiritual studies, and performances.

All sorts of people find going to this lakeside area, steeped in cultural activities to be the highlight of the year. There are also opportunities to dine out in a (small) variety of places and enjoy the architectural richness of the area.

In many respects, Lakewood shares some similarities with Chautauqua. We are a lakeside community, rich in entertainment opportunities, chock-full of interesting architecture and we have an institution, in the form of the library, that presents a wide variety of cultural enrichment and learning opportunities.

What we don't have is the marketing and reputation of the Chautauqua Institution. And we also don't have a "high end" concert a week, like they have. (The only show I wanted to see was Lyle Lovett's).

It would be possible to fill our summer weeks with dance performances, recitals, book discussions, etc. so that those with a Chautauqua-like hankering could find a number of reasons to plan a week vacationing in Lakewood.

This is a model that could be replicated.

So, it's not simply a vacation resort (although it can be...), but a destination with a purpose. People go there to vacation, be entertained, grow and learn.

And they go back year after year.

Why not here?