New London, CT now has the ability to use Land Value Taxation. According to an article in "The Day":
Used successfully in about 20 Pennsylvania communities as that state worked to recover from the collapse of its steel industry, the intent is to drive redevelopment. In commercial districts, property owners of vacant buildings or empty lots are often reluctant to make improvements until they see solid signs of progress around them. Without confidence in success, why improve or construct a building if it means higher property taxes?
But under LVT the larger share of the burden shifts to the land. Speculators, sitting on unused or underutilized properties, find taxes going up on their undeveloped lots. It is then in their interest to improve their properties or sell to someone who will.
LVT can be fashioned somewhat differently in residential neighborhoods, but with the same intent to encourage the improvement of properties. Some communities opt to utilize it only in business districts.
To its credit, the City Council set politics aside and unanimously supported the LVT concept. With that backing, Re-New London lobbied the state legislature to allow the new tax system in Connecticut cities. Lawmakers opted instead to allow New London alone to use it as a pilot project, if it so chooses.
The Center for the Study of Economics, working with Re-New London, has drafted several potential tax models for New London. The council recently sent the matter to its Economic Development Committee. To begin the process the city must file an application with the state. It should do so soon.
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