Tag: hidden costs

The Debate Over Mobile Home Parks

  • Because mobile homes can be transported they're not taxed the way permanent homes are. They're taxed like vehicles (when they're bought and sold). Mobile home owners pay a small tax for the small plot of land they sit on. (Photo by Chris McCarus)

People who live in mobile homes might be seeing their property taxes going up. Some government officials say it’s an attempt to tax for the services used and to discourage mobile home parks from sprawling across former farm fields. But others wonder if higher taxes aren’t a form of discrimination against this kind of affordable housing. The Great Lakes Radio Consortium’s Chris McCarus reports:

Transcript

People who live in mobile homes might be seeing their property taxes going up. Some government officials say it’s an attempt to tax for the services used and to discourage mobile home parks from sprawling across former farm fields. But others wonder if higher taxes aren’t a form of discrimination against this kind of affordable housing. The Great Lakes Radio Consortium’s Chris McCarus reports:


(sound of expressway traffic)


The Capital Crossings mobile home park sits on rolling farmland near an Interstate highway. The residents of the 15 homes have moved here either to retire or to make the 30 minute daily commute to nearby Lansing, Michigan. And more mobile homes are being pulled in.


(sound of construction)


Workers are building porches and attaching the skirting between the ground and the house. It’s supposed to show permanence, like a foundation. But mobile homes are not permanent. And mobile homes are not taxed the same way as other houses. They’re taxed like vehicles. Taxed when they’re purchased. Taxed when they’re sold. Still there are no property taxes on the homes. Only on the tiny lots on which they sit.


Some government officials say the $3 a month that these park residents have been paying for property taxes don’t cover the costs of police and fire protection or other government services. They want a tax hike to give local governments more money. Dave Morris is a farmer and the local township supervisor.


“We all have to pay our fair share for services such as sheriff, ambulance, fire department as well as schools. Schools is a big issue of course. And they aren’t paying their share. That’s all.”


But advocates for affordable housing say hiking taxes on mobile home residents is more likely just an attempt to discourage that kind of housing. They say zoning mobile homes out of existence has been tried, but taxing them out is a new idea. Higher taxes will likely lead to mobile home parks closing.”


John McIlwain is with the Urban Land Institute. He says as mobile home parks become more expensive to operate, their owners will sell off to subdivision or big box store developers.


“The numbers are going to be so attractive that the people who own mobile home parks are going to be much more interested in selling the land to a housing developer than in continuing to run the mobile home park. So in time the parks are probably going to disappear on their own anyway and trying to raise the taxes on them specifically is simply going to make that day come earlier.”


In Michigan there is a proposal to raise the taxes on mobile home sites four times higher. State Senator Valde Garcia says the $3 a month that mobile home park owners pay for each home site is not nearly enough.


“What we are trying to do is really change the tax structure so it’s fair to everyone. The system hasn’t changed in 45 years. It’s time we do so but we need to do it in a gradual manner.”


Senator Garcia’s colleagues in the state house have voted to raise the tax to $12 a month. He’d like to raise it to at least $40 a month. The mobile home park industry has hired a public relations firm to produce a video criticizing the tax increase.


“Site built homes pay sales tax only the materials used in their homes and don’t pay tax on resale. Manufactured home owners pay sales tax on materials, labor, transportation profit of a home and they pay sales tax every time a home is resold. ”


The two sides don’t agree on the math. Tim Dewitt of the Michigan Manufactured Housing Association says $3 a month sounds low because it doesn’t show hidden costs. The biggest cost comes when park owners have to pay the higher commercial property tax instead of the lower homestead tax. Dewitt says the park owners then pass the tax to the home owners whose average family income is only about $28,000 a year.


“That’s our worst fear. It could put people who could least afford any type of tax increase into a tough position.”


15 million people live in mobile home parks around the country. And different local governments have tried to find ways to increase taxes on mobile home parks. But Michigan is one of the first states to propose hiking taxes this much. State Senator Garcia says he is not trying to hurt the mobile home industry or make life harder for mobile home park residents. He dismisses the idea that he’s being pressured by wealthier constituents who don’t like to see the mobile home parks being developed.


John McIlwain of the Urban Land Institute says a bias against mobile home parks is part of the mentality that leads to sprawl. When people from the city and the suburbs move a little further into rural areas they want the look and feel of suburbia.


“The mobile home parks are no longer things that they want to see. And so they find ways to discourage those mobile home parks. The ones that are there try to see if they can be purchased, turned into stick built housing or otherwise discourage them and encourage them to move on elsewhere.”


But often the people who move in also want the shopping centers, restaurants and conveniences they once had instead of the mobile home parks.


For the Great Lakes Radio Consortium, I’m Chris McCarus.

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Hidden Costs of Sprawl

  • Economists and urban planners are beginning to look at the hidden costs of sprawl. They're finding many people pay, but only a few benefit from the costs. Photo by Lester Graham.

Even if you don’t live in an upscale suburb in a sprawling metropolitan area, you’re likely paying to support that suburb. Economists and urban planners find there are hidden costs that are not paid by the people who live in those suburbs. Instead, much of the costs are paid by the majority of us who don’t live there. The Great Lakes Radio Consortium’s Lester Graham reports:

Transcript

Even if you don’t live in an upscale suburb in a sprawling metropolitan area, you’re likely paying to support that suburb. Economists and urban planners find there are hidden costs that are not paid by the people who live in those suburbs. Instead, much of the costs are paid by the majority of us who don’t live there. The Great Lakes Radio Consortium’s Lester Graham reports:


If you just bought a home that cost hundreds of thousands of dollars in a neighborhood of similar big expensive houses… you probably think you’ve already paid your fair share to attain the good life. The mortgage is a monthly reminder. And the real estate taxes are another. But the price you’re paying is just the beginning of the costs that make it possible for you to live there. Much of the rest of it is paid by people outside of your suburb; people who never realize the benefits.


Myron Orfield is the author of the book “American Metropolitics: The New Suburban Reality.” He says the people who live in the upscale suburbs get the advantages of the good schools and the nice roads… but they don’t pay all of the underlying costs. Much of that is passed on to others…


“Most of us don’t-aren’t able to live in the communities with 400-thousand dollar houses and massive office parks and commercial industrial. Only about seven or eight percent of us can afford to live there and the rest of the region really pays the freight for that.”


That’s because the rest of the region pays the county and state taxes that make the roads and nice schools possible. Orfield says a residential area alone doesn’t generate enough tax revenue to pay the full costs.


“So we all subsidize that development and so when all the resources of the region concentrate in six or seven percent of the region’s population, it really hurts the vast majority of the people.”


And while the cost of supporting the upscale neighborhoods is substantial, that’s just the beginning of the hidden costs of sprawl.


In most cases, those nice suburbs are nice because they’re situated away from the hub-bub of the daily grind of work and traffic and hassle. The people who live there might have to drive a little farther to get to work, but, hey, when they DO get home, it’s a complete escape, worth the extra drive time. Right?


William Testa is an economist with the Federal Reserve Bank in Chicago. As an economist, he measures things by how efficient they might be. He says driving a little farther from the nice suburbs to work and back wouldn’t necessarily be a bad thing.
“If people want to travel further because they can live better, then it’s their choice and they feel they live better with a longer commute, then we wouldn’t necessarily call that an inefficiency. When it can be inefficient is when people don’t pay
for the costs of their own travel.”


And that’s the rub. If you decide to drive 30 miles to work instead of ten miles, the taxes on the extra gasoline you burn don’t begin to pay the extra costs of that decision… Again, William Testa…


“The spill-over costs that they don’t internalize when you decide to get in your car and drive someplace, such as to your job, is environmental degradation, the cost of road maintenance isn’t directly paid for when you decide how many miles to drive, maintain the road, the police, ambulance services and the like. So, economists would say that driving is not priced correctly to have people efficiently choose how many miles they choose to drive.”


While urban sprawl’s economic costs to society are substantial, there might be larger costs.


When an upper-middle income family chooses to live in an enclave of others in their tax bracket, it’s a given that the people who teach their children, who police the neighborhoods, and fight the fires are not going to be able to afford to live there.


In fact, those who would work in the restaurants and at the service stations in many cases can’t take those jobs because they can’t afford the housing and they can’t afford the commute.


Emily Talen is an urban planner at the University of Illinois. She says
that’s a cost that can’t always be measured in dollars and cents. It’s a separation of the haves and the have-nots.


“Social cost is that fragmentation, that separation, that segregation really on an income level more than anything else.”


Talen says when people decide they can afford the good life in the nice suburb, the new American dream, they often only think of their own success, but not about the costs to others.


“This is what our nation is founded on. I mean, it is founded on the pursuit of happiness and I think that that has been kind of problematic for people thinking in terms of their own individual happiness rather than issues about the common good.”


And so, Talen says when a town decides it will only allow expensive houses to be built, it’s decided that all labor for its services will be imported from out of town. The expense of that decision is borne by everyone else… especially the lower-income people forced to commute.


William Testa at the Federal Reserve Bank in Chicago says in the end, that cost might be the greatest one to society at large.


“This, it seems to me, is un-American and very un-democratic and something that we ought to think about very seriously. Could we really live with ourselves in a society where there aren’t housing options available for people to make a livelihood, to follow the opportunity for their livelihood.”


The experts say there’s nothing wrong with pursuing the good life, as long as everyone is paying their fair share of the cost. They say right now, that’s not happening… and those who never benefit from a pleasant life in the suburbs are paying much of the cost for others to do so.


For the Great Lakes Radio Consortium, this is Lester Graham.

HIDDEN COSTS OF SPRAWL (Short Version)

  • Economists and urban planners are beginning to look at the hidden costs of sprawl. They're finding many people pay, but only a few benefit from the costs. Photo by Lester Graham.

Economists and urban planners are beginning to calculate some of the hidden costs of urban sprawl to society. The experts say those costs are often borne by people who don’t enjoy the benefits of living in the expensive new suburbs. The Great Lakes Radio Consortium’s Lester Graham reports:

Transcript

Economists and urban planners are beginning to calculate some of the hidden costs of urban sprawl to society. The experts say those costs are often borne by people who don’t enjoy the benefits of living in the expensive new suburbs. The Great Lakes Radio Consortium’s Lester Graham reports:


When a town in a sprawling metropolitan area limits development to big expensive houses, that means the people who work in the service stations and the restaurants have to live somewhere else. They are forced to commute. That means a greater demand for roads. And that costs all of us. William Testa is with the Federal Reserve Bank in Chicago. He says an even greater cost is lost opportunity for those who can’t even afford to make the commute to the jobs…


“The higher costs may be on people in the inner-city – or wherever – in low-income areas who can’t afford to live close to the places where the job demand is, where the jobs are being created.”


Testa says developing suburbs should consider building affordable housing for workers. If that doesn’t happen, he says society should find a way for those suburbs to pay the cost of their decisions.


For the Great Lakes Radio Consortium, this is Lester Graham.