Residential Property Tax Abatement

178 Pages·2016·0.78 MB·English

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Doreen Swetkis
Cleveland State University
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Swetkis, Doreen, "Residential Property Tax Abatement;Testing a Model of Neighborhood Impact" (2009).
ETD Archive. 286.
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RESIDENTIAL PROPERTY TAX ABATEMENT:
TESTING A MODEL OF NEIGHBORHOOD IMPACT

DOREEN SWETKIS

Bachelor of Liberal Studies

Bowling Green State University

May, 1991

Master of Education

Cleveland State University

December, 1998

Submitted in partial fulfillment of requirements for the degree

DOCTOR OF PHILOSOPHY IN URBAN STUDIES AND PUBLIC AFFAIRS

at the

CLEVELAND STATE UNIVERSITY

December, 2009
© Copyright by Doreen Swetkis 2009
This dissertation has been approved for the Department of URBAN STUDIES

and the College of Graduate Studies by

_____________________________________________
Dissertation Chairperson, Professor Mark S. Rosentraub, Ph.D.

___________________________________
Department of Urban Studies, Date

____________________________________________
Professor William M. Bowen, Ph.D.

___________________________________
Department of Urban Studies, Date

____________________________________________
Professor Julia Beckett, J.D., Ph.D.

___________________________________
Department of Public Administration and Urban Studies,
The University of Akron, Date
DEDICATION

This dissertation is dedicated to my wonderful husband Marc, whose steadfast support
was paramount to my success,
and to my daughter Fay, who can now call me “Dr. Mommy”.
ACKNOWLEDGEMENTS

I wish to thank my dissertation chair, Dr. Mark S. Rosentraub, for providing consistent
and sage advice throughout this entire process, and saving my academic life. I would like
to gratefully acknowledge Dr. William M. Bowen. Words can not fully express the deep
respect, admiration and gratitude I feel for having had the pleasure of learning from him
throughout my time in the program. I wish to thank Dr. Julia Beckett, whose comments
and perspective were instrumental in the formulation of this final document.
I want to acknowledge what an honor it had been to work with the faculty, staff and
students of the Maxine Goodman Levin College of Urban Affairs, especially Dr. Roberta
Steinbacher. Such a supportive environment has been instrumental to my success.
Finally, I would like to acknowledge the Albert A. and Maxine Goodman Levin Advisory
Fund for providing financial assistance for this dissertation.
RESIDENTIAL PROPERTY TAX ABATEMENT:
TESTING A MODEL OF NEIGHBORHOOD IMPACT
DOREEN SWETKIS
ABSTRACT
Using a quasi-experimental research design, this study examines the relationship
between residential property tax abatement for new construction, and urban
neighborhoods in four Ohio cities. Neighborhoods were defined as census tract. The
purpose of this research is to determine if there is a statistically significant relationship at
p < .05 between residential property tax abatement programs for new construction and
several different measures of neighborhood outcomes. The neighborhood outcome
measures can be grouped under the broad concepts of increased private investment, blight
removal, decreased criminal activity, and property tax equity. Subsequent questions
investigated are the direction of these relationships and the existence of a threshold level
at which point relationships become significant. The utilization of a comparable
comparison group addresses the counterfactual scenario. Independence of samples tests
and multivariate cubic regression are employed to answer the research questions.
Results indicate that there are no discernable effects between residential property tax
abatement and the indicators of neighborhood change as defined in the study. Second,
there appears to be no threshold at which the number of tax abated residential units
becomes significantly associated with the indicators of neighborhood change. Third,
there were no significant differences on the indicators of neighborhood change between
subject and comparison groups. In essence, there are no effects from residential tax
abatement policy seen at the neighborhood level.
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TABLE OF CONTENTS
Page
ABSTRACT ..…………………………..……………...…………………………….......vi
LIST OF TABLES ……………………………………………………………………….xi
LIST OF FIGURES ………..…………………....………………………………………xii
CHAPTER
I. INTRODUCTION ………………………………………………….……………...1
1.1 Purpose of the Study and Statement of the Problem …………………………1
1.2 The Political Debate ……………………………..…………………….……..4
1.3 Statement of the Research Question …………………………………………7
1.4 Objectives and Significance ………………………………………………….8
1.5 Definition of Terms …………………………………………………………10
1.5.1 Residential Property Tax Abatement (RPTA) ……………………10
1.5.2 Effective …………………………………………………………..12
1.5.3 Equity ……………………………………………………………..13
1.5.4 Neighborhood …………………………………………………….15
II. LITERATURE REVIEW ………………………………………………………..17
2.1 Introduction …………………………………………………………………17
2.2 State Legislative History ……………………………………………………18
2.3 Municipal Development and Administration of RPTA……………………..21
2.3.1 Cleveland …………………………………………………………24
2.3.2 Columbus …………………………………………………………25
2.3.3 Dayton …………………………………………………………….26
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2.3.4 Toledo…………………………………………………………………28
2.4 Incentives as Tax Policy…………………………………………………….30
2.5 Theoretical Issues …………………………………………………………...42
2.5.1 Inter-Jurisdictional Competition ………………………………….43
2.5.2 Equity ……………………………………………………………..53
2.5.3 Neighborhood Change ……………………………………………60
2.5.4 Theory of Broken Windows ………………………………………63
2.5.5 American Ideology………………………………………………...67
2.5.5.1 Anti-Urbanism ……………………………………………...68
2.5.5.2 The Rural Ideal ……………………………………………..69
2.6 Conclusion ………………………………………………………………….73
III. FRAMEWORK AND HYPOTHESES …………………………………………….75
3.1 Conceptual Framework ……………………………………………………..75
3.2 Hypotheses ………………………………………………………………….80
3.3 Null Hypotheses and Significance Testing………………………………….82
IV. METHODOLOGY …………………………………………………………………85
4.1 Research Question ………………………………………………………….85
4.2 Research Design …………………………………………………………….86
4.3 Study Population ……………………………………………………………90
4.4 Statistical Model ……………………………………………………………91
4.5 Variables ……………………………………………………………………93
4.5.1 Dependent Variables …………………………………………….93
4.5.1.1 Private Investment & Blight ……………………………94
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4.5.1.2 Crime ……………………………………………………95
4.5.1.3 Equity …………………………………………………...97
4.5.2 Independent Variable ……………………………………………..98
4.5.3 Control Variables ………………………………………………..100
4.6 Data Collection ……………………………………………………………103
4.7 Data Analysis ……………………………………………………………...105
V. DATA ANALYSIS ……………………………………………………….………..106
5.1 Introduction ………………………………………………………………..106
5.2 Summary Results of Hypothesis Testing ………………………………….107
5.3 Preliminary Analysis of Independent Variable ……………………………108
5.4 Descriptive Statistics of Dependent Variables …………………………….110
5.5 Model Results ……………………………………………………………..112
5.5.1 Private Investment & Blight …………………………………….113
5.5.2 Crime …………………………………………………………….120
5.5.3 Equity ……………………………………………………………123
5.6 Conclusion ………………………………………………………………...126
VI. CONCLUSIONS, IMPLICATIONS & RECOMMENDATIONS ……………….128
6.1 Answering the Research Question ………………………………………...128
6.2 Results of Analysis & Theoretical Concepts ……………………………...131
6.3 Policy Implications ………………………………………………………..133
6.4 Limitations of the Study …………………………………………………...136
6.5 Suggestions for Future Research ………………………………………….139
6.6 Concluding Remarks ..……………………………………………………..140
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