Should Suburbanites Make Charitable Donations to the City?

Should Suburbanites Make Charitable Donations to the City?

A recent opinion letter printed in the Post Gazette urges suburbanites to voluntarily send money to the City to help it with its financial problems. The letter writer laments the City’s inability to expand its borders to increase its tax base. Then the writer leaps to the conclusion that those living in the suburbs have an obligation to provide monetary support to the City.

Obviously the author of this nonsense does not read our Policy Briefs or blogs. As we have documented time and again, non-residents pay a lot of taxes to the City for precious little services in return. Here’s a partial list: Anyone paying sales taxes in Allegheny County contributes through the one percent Regional Asset District tax which provides substantial funding for the new stadiums, as well many of the City’s cultural and recreational assets. Many pay this tax and yet never set foot in the City. Anyone purchasing a ticket to a sporting event, concert, or play pays an amusement tax and lest it be forgotten when you park in the City, you have the dubious privilege of paying the highest parking tax rate in the nation-almost 40 percent.

People working in the City not only pay the $52 local services tax but their private sector employer has to pay business taxes such as the payroll preparation tax. These businesses also pay real estate taxes either directly on the properties they own or through rent for building space owned by others.

In short, non-residents pay significant amounts into the City’s coffers.

The real problem, studiously ignored by the author, is City spending. Anyone attempting to weigh in with solutions to the City’s problems should at least be familiar with the facts. As we have documented on many occasions in reports and Policy Briefs, similar cities such as Charlotte, Columbus, Salt Lake City, and Omaha, all spend less per capita, have healthier pension plans, and much lower debt levels than does Pittsburgh. Virtually all other municipalities in Allegheny County have lower per capita spending and debt levels.

People and businesses are not located in Pittsburgh for a variety of reasons, one of which is the heavy tax burdens. Surely they have no interest in voluntarily paying for the exorbitant, wasteful spending of the City.