As the newly elected mayor of New Albany, I’m often asked, “What is the biggest challenge facing our community?”
The straight answer is “the long-term fiscal sustainability of our schools.”
While New Albany-Plain Local Schools and the City of New Albany are separate units of government, our community was born in the spirit of collaboration and problem-solving. Thus, the citizens of our community rightfully expect the city to offer assistance to and collaborate with the schools on identifying long-term solutions.
The New Albany Community Task Force’s deep dive into our schools’ fiscal situation supports the fact that this challenge cannot be solved with a single approach. To solve this problem together as one community, we will need to be united behind a multifaceted approach.
So, what exactly has the city been doing to help our schools? In short, we are staying true to our master plan of smart residential growth and deliberate economic development. By design, this approach minimizes the addition of new students, diversifies our tax base and generates additional revenue for our schools. Additionally, we have reprioritized our city’s capital, leisure trail and road construction projects to increase safe routes to schools.
The City’s past economic development efforts produced significant tax revenue for our schools while simultaneously reducing the number of potential students in our district. Our New Albany International Business Park generated almost $59 million in tax revenues for our schools from 1998-2015, and businesses have invested more than $2 billion into our community. If this development had never occurred, school tax revenues from this undeveloped land over that same time would have been $5.7 million – about 10 percent.
So how does the City’s use of abatements actually help the schools? To offset any lost property tax going to our schools because of the abatement, the City shares income tax revenues from the project with our school district in an amount similar to the abated property taxes the district would have received. New commercial development also reduces the number of homes and students in our school district.
Had our business park developed residentially, 1,900 more homes could have been built, resulting in more than 1,400 new students. In that scenario, the median New Albany homeowner ($485,200 home value, $185,076 household income) would have to pay an additional $2,346 in annual taxes just to maintain the current level of City and school services.
When it comes to development, New Albany City Council takes a holistic community view. We care deeply about our schools and have a strong and consistent history of supporting their efforts, be it through increased tax generation, having the lowest residential density in central Ohio or providing school resource and DARE officers free of charge on our school campus. Our business park’s 13,000 employees also provide the population density necessary to support restaurants, health and retail offerings residents want.
Lastly, the income taxes paid by our business partners go a long way toward paying for and delivering municipal services for you and your neighbors. More than 80 percent of the City’s budget is derived from those who work in New Albany, regardless of where they live. The City only receives 2 percent of your property taxes, and most residents who work elsewhere pay no income taxes to New Albany.
Bottom line: New Albany’s strategic use of abatements to grow our commercial development increases and diversifies our local income taxes, financially helps homeowners, protects our schools and allows our city to continue providing high-quality municipal services. You can read more about the city’s use of abatements and financial standing, as well as your taxes, in our annual report that was mailed to every household with the May/June issue of Healthy New Albany Magazine.
Sloan Spalding is mayor of New Albany. Feedback welcome at gbishop@cityscenemediagroup.com.
