RTA’s Dillard Seeks Tax Hike – Part 2

The RTA tax flag has been hoisted by Kirk Dillard.

The RTA tax flag has been hoisted by Kirk Dillard.

Yesterday I vented at what current RTA Board Chairman Kirk Dillard did to raise our sales taxes one-half of one percent when he was State Senator.

I’ll admit that really bothered me when he ran for Governor in 2010 and 2014.

Today, however, I’d like to take a look at a comment Dillard made while pitching a tax increase to pay for re-building the Regional Transportation Authority’s infrastructure.

This isn’t something Dillard advocated, but it makes a lot of sense.

The Chicago Sun-Times article has a paragraph in which Dillard “pointed to renovation of the CTA’s Brown Line, saying real estate values within a mile of the elevated train line went up by 40%.

I’ve not a clue where the Brown Line runs (looking at a map doesn’t help because of my colorblindness.)

It really doesn’t matter.

What matters is that infrastructure improvements increases the value of adjacent real estate.

That brought to mind site value taxation.

I first read about it in my supplementary economics book, “The Worldly Philosophers.”

Henry George, America’s first noted economist, argued that improvements to real estate should not be taxed.

He wanted governments just to tax the land.

That would mean that land near desirable features, think of lakes in McHenry County and the Fox River, would be worth more than property farther away.

Likewise, land near train stations would be worth more than land elsewhere.

That’s what Dillard pointed out.

My education in site value taxation was expanded by a retired gentleman from Antioch named Weld Carter.  Right after graduation, he served as Thomas Edison’s mathematician.

He quit when Edison reacted badly to his telling him that what Edison wanted him to prove could not be done.  Edison was not interested in the facts in this case.

After reading Henry George’s book, “Progress and Poverty,” Carter became a teacher of the theory and, eventually, the evangelist for site value taxation.  He worked for the Robert Schalkenbach Foundation.

In the 1970’s, he took me to a conference on the subject in Madison (the October, 1973, weekend that Elliot Richardson resigned from the Nixon Administration) and to one in Washington in the winter of 1977 where supporters of the idea were trying to get the subway being built financed by such taxes.  Newly-elected Indiana Senator Richard Lugar was at one gathering.

The basic idea is that increases in the value of land (and, of course, buildings as well) would be subject to a property tax.

The concept encourages growth that is near infrastructure.

When one makes improvements on one’s property in today’s real estate tax system, one’s taxes increase.

Under Henry George’s single tax idea, building a house on a lot would not increase one’s property taxes.

Conceptually, this idea could be transferred to RTA’s infrastructure money need.

The improvements in the RTA system could be financed by a real estate tax on the increase in the value of the adjacent property.

Crystal Lake has the best commuter railroad service in McHenry County.

Crystal Lake has the best commuter railroad service in McHenry County.  Train is crossing Route 176 here.

Dillard says that property values increased within a mile of the CTA’s Brown Line.

One could pick any distance, of course.

I believe that property values in the Crystal Lake-Cary-Fox River Grove area are higher than they would otherwise be because of the Metra commuter line.  (It’s not that Metra did anything.  The values were also higher when the Chicago & Northwestern Railroad ran the trains.)

This idea will not be selected, but it does make more sense than any other, I believe.

In he 1970’s, I crafted language to amend the State Constitution to allow this change.


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