No, Developing The Lakefront Is Not Worth Raising Our Taxes – [OPINION]
I watched the debate between the mayoral candidates the other day over on KPLC’s website, which was only 30 minutes long with a “lightning round” of exactly one question, so I didn’t really get a lot out of it. However, one topic did stick out, and it’s one that really bugs me: developing the lakefront.
Without commenting on either of the candidates’ positions, I’d just like to throw this out there: developing the lakefront would be nice, but I ain’t paying for it.
Louisiana already has the highest sales tax rate in America, and Lake Charles itself generates most of its revenue from our even higher local sales tax. The state tacks on 5%, then Lake Charles adds another 5.75% on top of it for a combined rate of 10.75%, which is .77% more than the state average of 9.98%. That means you’re paying an extra 11 cents on every dollar you spend, which might not sound like a lot, but it adds up fast. For every $10 you spend, you’ll pay an additional $1.07. For every $100, it's $10.75. For every $1,000, that's another $107.50. You get the idea.
In contrast, property taxes account for only 12.6% of the city’s budget, which means property owners pay a whole lot less than your average joe spending $100 at the grocery store each week. (Assuming they’re clipping coupons and there’s a sale on, of course.) And guess what? The plan to get investors to come in and develop the lakefront involves a bond and tax incentives, which involves a lot of financially voodoo that ultimately comes down to just one thing: raising the sales tax.
That’s right. The city will pay for developing the lakefront by making us pay for developing the lakefront, while the people and businesses developing the lakefront won’t pay much of anything, since we’ll be picking up the bill.
Now, the argument will be made that enticing people off of I-10 with a nice, attractive lakefront will put visitor dollars into the city’s coffers by way of those people paying sales tax on whatever they buy while they’re visiting - which is great and all, but the lion’s share of the budget will still come from us working stiffs just trying to make ends meet.
When you add increasing our already high sales tax to the skyrocketing costs of rent in Lake Charles (while the average salary has actually gone down over the past decade), you’re setting up a very predictable bubble and calling it a boom.
There’ll be a boom alright - when the bubble bursts.
The state is set to hike up gas prices by potentially nearly doubling the current tax rate for every gallon of gas we buy. We’re nickel and dimed every five minutes by both the state and the city with this tax or that fee, and it all adds up. Nobody is making more money from stagnant wages, the cost of everything from rent to basic food is skyrocketing, and taxes keep climbing.
How long does the city think we can keep this up?
Look, I’m all for having a nice lakefront to go visit. I’d love to see some investors come in and really spruce the place up. We need more growth in North Lake Charles, especially along the I-10 corridor - but we don’t need to raise our taxes to do it. That only benefits the investors who will make plenty of money off of the development, while us normal folks assume the real cost.
We can’t keep raising the cost of living while lowering - or even just maintaining - current wages for average workers. The jobs being created by all of these new chain stores and restaurants are low-paying positions. After all, it doesn’t really matter if Billy Bob’s Burger Chain creates 100 new jobs if they all pay minimum wage.
Yes, minimum wage was designed to be a starting point to springboard into a career and a better-paying job. I get that. The problem is, there aren’t that many better-paying positions out there. Here are the top 10 jobs that employ the most people in Lake Charles, according to usawage.com:
- Retail salespersons
- Office Clerks
- Maintenance Workers
- Registered Nurses
- Personal Care Aides
- Secretaries and Administrative Assistants
Of every job on that list, only nurses and maintenance workers make decent money, with average salaries of $58,990 and $35,690, respectively. Retail salespersons and cashiers don’t even crack $20,000 a year.
If we build a fancy hotel and some restaurants on the lakefront, we won’t be creating a bunch of high-paying jobs. We’ll create more retail, cashier, waitstaff and housekeeping positions, sure - but the highest paying job on that list makes less than ten bucks an hour.
Of course, this extends beyond just the lakefront and applies to virtually all of the “growth” our city leaders keep telling us is happening. Sure, we have more businesses coming in, but most of them create low wage jobs, while most of the positions that pay well are temporary, and taken up in large part by out-of-town workers who come in to complete these growth projects, send their wages back home, then leave when they’re done.
We need to take a step back and look at whether all of this growth is actually worth it. Without something as heretical as rent control, rent will continue to skyrocket as the city continues to grow - a short-term market response to the influx of construction workers needing a place to live. But once those jobs are done, once the “growth” slows, we’ll be left with a bunch of apartments and houses priced way too high that no one can afford. The bubble will burst, the boom will turn to bust, and it won’t matter how pretty the lakefront looked, because there won’t be anyone around who can afford to keep it in business.
I don’t have an answer, but at least I can acknowledge the problem. We’re being taxed into the ground already, and what we pay just seems to keep climbing higher and higher. You can only stretch people so thin before they just can’t possibly afford to live here anymore. And, while the powers-that-be might love the idea of a city populated entirely by the wealthy, Lake Charles isn’t San Francisco. We can’t price people out of their homes when we don’t have a Google or Microsoft nearby for them to go work at.
You know what might be worth our tax dollars, though? Better roads, with wider lanes and bike lanes, and a lot less potholes. Fixing our drainage problems is also pretty high up on the list, so maybe it wouldn't flood every time we have a light afternoon shower. Fix what's broken first, then worry about building fancy new things later.
We need reasonable solutions that factor in the longterm cost to the average taxpayer in this city. What will we get out of developing the lakefront that could justify raising the cost of nearly everything we buy? What do we gain from new stores opening up, when we can’t afford to shop at them? What good is a new restaurant when the average cost of a meal is too expensive for any of us to pay?
What do you think happens when the boom is over and the bill comes due? Will all of those fancy new stores and restaurants and hotels be able to stay in business without customers? Will the hotels and motels be able to stay open when the temporary workers leave? Will all the apartment complexes and rental properties be able to find anyone who can afford to fill them?
I don’t know. Like I said, I don’t have the solution. I just know that raising the sales tax isn’t the answer. Either find another way to pay for it, or don't do it. No development is worth making Lake Charles an even more expensive place to live than it already is.
But that's just my opinion.