The upside of all the construction mess

Sometimes good stuff happens that goes unnoticed that cancels out a lot of, if not all the bad stuff that does get noticed.  

Right now there is a fairly vocal group in town complaining that they are having a hard time finding downtown parking within 20 feet of where they want to go.  They are complaining about construction noise in downtown.  They are complaining about traffic congestion.  And most of all they are complaining about all the people that are going to move to Redwood City or work in Redwood City and how we are going to pay for all those services to theses new people.  They want all this development to slow down if not stop al together.

Sounds awful, doesn’t it.  So where is the good side to all of this?

At the end of 2010, the city collected just under $70 million in permit fees and property tax during a time when some of current projects were still in the approval phase.  Now, with the approvals of the Mel’s Bowl project on El Camino, the Veterans Boulevard housing project and the Downtown complex now underway, development is bringing in $200 million to the city.  That’s more than a 100 percent increase in three years.

Sales tax revenue were around $14.6 million in 2010 and were projected at $17 million, but ended up being $24.7 million, most of it coming from the sale of gasoline and auto sales.  

That does not mean we are rolling in dough.  We have been siphoning off our reserve fund to keep out of deficit spending for several years and it's time to replenish that. We still have to pay back the state for the $10 million in redevelopment funds it "gave" us out of our property tax money.  We still have massive payments to make into the city employee retirement funds and the cost of doing everything is going up.  But all this development is helping us meet our current responsibilities and fund our future at the same time.

It’s real money, not bond funds.  As the projects come to completion and begin to fill, both property tax revenues will rise along with sales tax.  And it means that traditional taxes should not have to be increased as we expand the current tax base.

This growth comes with a lot of discomfort.  Sometimes you may not find a parking place in front of your favorite restaurant.  You might have to pay 25 cents more for parking and you might have to walk another block or two to get there.  It might not be easy to drive through downtown unimpeded like you did in past years.  But what it does give us is the opportunity to maintain the current level of service and perhaps expand it.  It means more places for people to live close to work.

I’m in the business of helping business grow.  I like to promote Redwood City as a place to come.  I’ve brought potential businesses to Redwood City for meetings and the reaction is always the same, whether they come from Asia or Europe.  They are impressed with the potential this city has and are interested in coming here.  But until recently, their reason for not coming is always the same: not enough office space, no enough housing, not enough public transit.  None of that can happen without public revenue, Public revenue is raised through increasing taxes or by expanding the tax base through development.

That’s the way it works.