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RE: Harrisburg, Pennsylvania

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  • Wetzel Dave
    ... From: John.Illingworth@leeds.gov.uk [mailto:John.Illingworth@leeds.gov.uk] Sent: Friday, September 23, 2005 12:29 AM ToWetzel Dave;
    Message 1 of 1 , Sep 23, 2005
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      -----Original Message-----
      From: John.Illingworth@... [mailto:John.Illingworth@...]
      Sent: Friday, September 23, 2005 12:29 AM
      ToWetzel Dave; SirMichaelLyons@...
      Subject: Harrisburg, Pennsylvania

      Dear Colleagues,

      I am writing to recommend the city of Harrisburg website which holds some
      important lessons for Leeds.


      Contrasting its 1981 status as the second most distressed city in the USA,
      Harrisburg has undergone a dramatic economic resurgence, with over $2.65
      billion in new investment now realized. Major net gains in the number of
      businesses, private sector jobs and livable homes have reversed three
      decades of previous decline. Property values have significantly increased
      ten fold while the crime, fire, vacant property and unemployment rates have
      sharply dropped.

      How have they done this, when so many other cities have failed?

      Careful study of their website reveals an enlightened and progressive
      administration, but the key lies in their tax regime. In contrast to the
      UK, with its penchant for incompetent and over-centralising governments,
      American cities have the freedom to raise their own taxes and decide their
      own economic policies.

      Harrisburg was one of the first major cities to implement Land Value
      Taxation (LVT), where the tax burden falls only lightly on the buildings,
      but mainly on the land underneath. Vacant or partially developed sites pay
      the full whack, and maximum development attracts very little additional
      tax. One of many beneficial effects is to push vacant or underused sites
      onto the market at attractive prices, available to anybody with the drive
      and enthusiasm to press them into use. This vital policy is tucked away in
      their website at


      Scroll down to the section on "Two-Tiered Real Estate Taxes" to see how
      their system works. What a contrast with the UK, where investors
      obsessively hang on to derelict or underused land whether it is working for
      anybody or not. Land value taxation is not the only economic incentive in
      Harrisburg, but it is the feature which makes them unique. It marks them
      off from comparable cities (like Leeds?) whose economic performance is
      patchy, to say the least.

      At present LVT is not on the agenda for any major UK political party, but
      as the Lyons inquiry (http://www.lyonsinquiry.org) struggles with the
      "insoluble" problems of local government finance, a growing number of
      individuals are thinking outside the box.

      Councillor John Illingworth

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