By Michael Gaffney
The buzz was about town that Worcester was on the move. I was 23 years old and buying my first home. I chose Worcester. All the talk about how the downtown was coming alive with the Worcester Common Fashion Outlets and the soon to be artist district with the Burwick Building conversion. This was no longer my parent’s or grandparent’s city, Worcester was coming of age. (The same elected officials proclaiming their success are now leading the City)
By my thirties the Worcester Common Fashion Outlet was a desolate shell of a building sitting vacant in the middle of the City. The arts district was anything but artistic. A complete failure of leadership. (Yet, the very same elected officials proclaiming their success are now leading the City)
By my late thirties, Worcester was again on the move. Building were being knocked down to make room for the new city. Councilors were heard proclaiming that the crane was the new bird in Worcester with all the successful development. But, the buildings were knocked down, leaving dirt lots as the revitalization of the downtown again failed. (Still, the very same elected officials proclaiming their success are now leading the City)
Here we are now, once again claiming that the downtown is a success story. That Worcester is on the move. The city is coming of age and anyone that says otherwise hates Worcester. Seriously, to question is to hate Worcester.
The fact is, the adults in the room have heard it all before. We’ve seen the cycle. We understand that the fundamentals that drive success are not in place. Allegro Microsystems and Primetals Technologies announced they are both leaving the city taking with them tax revenues, business revenues from companies serving them and their employees, and approximately 665 jobs. Allegro is moving to Marlborough while Primetals is moving to Sutton. Both are moving due to the high tax rates in Worcester and better facilities. We know that the businesses moving into the new offices downtown are just moving from the old offices downtown. It’s a shell game with increasingly fewer shells.
Year over year, boom or bust, the City has constantly increased spending. Services certainly haven’t improved despite dumping increasing sums of cash into the city coffers. The tax rates stifle business investment and keep families from purchasing property in the city.
Instead of resolving the spending issue, the argument is always framed to pit residents against businesses. Neither group has the elasticity to absorb shifting the burden onto the other. The fact is, spending has to be decreased to reduce the amount of taxes taken.
I’ve argued that the City needs to start by holding the line on taxes and using any savings to reduce the business tax rate. That is no longer an option. Taxes must be cut to make Worcester businesses more competitive. That will mean cuts to departments.
Of course, we’ve all heard that everyone want’s better parks, better roads, and better services. Of course they do! If asked, most people want better weather, more money, and to be in better shape. But, wants and needs aren’t always equal or obtainable.
Let’s look at Seattle as an example of how to drive businesses out by unreasonable taxes:
Even Amazon, a progressive company states “We remain very apprehensive about the future created by the council’s hostile approach and rhetoric toward larger businesses, which forces us to question our growth here.” They argue that since economic growth has increased revenues to the city since 2010 more quickly than the population has grown, Seattle’s growing homelessness population means: “The city does not have a revenue problem–it has a spending efficiency problem.” The same thing can be said about Worcester. More and more spending without results.
Starbucks, another progressive company, took a similar position. “If they cannot provide a warm meal and safe bed to a five year-old child, no one believes they will be able to make housing affordable or address opiate addiction.” In sum, more taxes do not mean improved results. In fact, it is becoming increasingly clear that more taxes result in less opportunity. The issue compounds as more taxes are added.
Like Seattle, Worcester is on the move not just to increase taxes, but to look for new ways to tax. Just review the Mayor’s Tax Committee Report as it seeks to increase property taxes, gas taxes, retail taxes, etc. Right now, the City is pushing the proposal of a Community Preservation Act and are holding meetings that the majority of the residents of the City are unaware. The idea stems from the City Mayor’s tax plan wherein the City shall impose an ADDITIONAL 3% tax increase on properties above and beyond the usual 2.5% to support “open spaces”, “historic preservation”, “outdoor recreation”, and “affordable housing.”
Let’s make it simple. A person is shopping for gas and comes across two gas stations on either side of a road. The gas station on the right is selling the same gas as the station on the left for $1.00 less per gallon. A reasonable person will go to the station on the right. If you are a business, and it cost a third less to operate a business in any of the towns surrounding Worcester, you will open your business outside of town. This simple concept is instantly observable by noting that the major shopping centers are located outside of our city.
Year after year, I’ve found ways to cut spending or shift spending to slow the growth of the City budget without making cuts into department budgets. The truth is, I was merely putting a finger in the dam as the water poured over the top. I had proposed saving $15 million from the insurance trust fund and was told it could not be done. The administration fought me and none of the elected officials stood with me. Months later, the city announced that it could be done, but refused to use the savings for tax reduction. There is always opportunity to reduce taxes, but frankly, I didn’t do enough. I sought ways to reduce spending that would not affect department budgets as to avoid the greater battle that would have been waged over cutting personnel, but was still vehemently and often viciously opposed. In hindsight, I should have just proposed to cut 5% out of every department budget (except police and fire as they seemed to grow their budget the least year over year).
The city needs to cut spending and use the savings to bring down the business tax rates or else we will continue to repeat the cycle of failure. According to MSN.com, the Worcester metro ranks 20th out of cities hit the hardest by extreme poverty. Since 2010, the share of the poor population living in neighborhoods where at least 40% of the population live below the poverty line INCREASED by 3.6 percentage points to 12%. The number of Worcester neighborhoods in which at least 40% of the population are poor doubled from four to eight.
Those that don’t know history are doomed to repeat it. That’s why the adults in the room continue to question the so-called success. We know that without fixing our spending problem, we will forever have a growth problem. We can’t just continue to put on a new coat of paint without fixing the foundation.
We appreciate the 20 and 30 somethings that see a future in Worcester. We want Worcester to succeed, but don’t call us negative because we know that the fundamentals have not been fixed. We’ve seen this show before, we know the ending. We’ve been here all along. We love our city as much as you. Instead of ignoring us, help us to make sure that this time, Worcester succeeds.
“If there is a new way, I’ll be the first in line, but it better work this time.” – Dave Mustaine