Property Tax Revenue shifting from Commercial to Residential

Also in the WTNH article, were statements from Economist Ron Van Winkle about the property tax revenue shifting from "commercial enterprises to residential communities".

He then goes on to say:

"It shifts primarily because the value of housing has risen so rapidly, in the last five years, it really has skyrocketed - while the price of commercial property has increased, it certainly hasn't increased at nearly the same rate,"

and

What's more troubling, says Van Winkle, is the fact cheaper homes are seeing bigger tax increases than expensive estates. Why? Because of the higher demand for inexpensive housing.

This leads me to a whole bunch of commentary.

• West Haven has a double whammy, then. Not only has the price of commercial property not increased at the same rate as residential property, but we have not grown our commerical tax basis. I'm going to look for the documentation to back this up, but I think our commercial entities have actually shrunk - Bayer has moved and closed parts of their operations, and even small businesses such as Mario's and Joseph's have moved out of town.
  
  
• Someone needs to tell Vision Appraisal about the fact that cheaper homes are seeing bigger tax increases. This certainly isn't the case in West Haven... inexpensive housing certainly saw lower tax appraisal increases than those homes on the West Shore.
  

Ron then goes on to say:

"In some cases you might see property taxes double in a home in Connecticut. It's going to mean to a lot of home owners may think about not staying, that they can not afford to live in the state of Connecticut," says Van Winkle.

As we know, this is certainly true... and unfortunately, it's a problem with a ripple-down effect. Not only will suddenly people be vacating the state, but then business will leave, due to difficulty of hiring employees for cost effective wages. This will mean that there are less commercial entities to pay property tax.