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Study: Sales taxes critical as city grows

Pretend, for a few minutes, that Grass Valley is a mid-ranked university with hopes of becoming a truly prestigious college. Not snotty or prohibitively expensive, just solid basic quality.

Already blessed with beautiful surroundings, this university/city hired top notch professors, developed a rigorous curriculum, and set high admission standards.

But Grass Valley is new at this top-notch stuff. When confronted with students that don’t meet its standards, it’s faced with a quandary. These students, interesting and talented in their own right but different than what Grass Valley expected, could either boost the city into the elite realm or drop it back with the hundreds of mediocre communities.



To confront this quandary, the city/university did what most anyone would do – study its options. What would be the effect of accepting some or all of these students?

Needless to say, the city is not a university. It aspires to be great, however, and adopted a governing document, the General Plan, that outlines its standards.




The four major proposed developments around the city – Kenny Ranch, SouthHill Villages, Loma Rica, and North Star – don’t completely accord with the General Plan. So last year, using $124,000 of developer money, the city hired a consultant, who has commenced on a three-part study of the developments’ effects on Grass Valley.

The first part of the study, released in July, called for the addition of more than 300 acres to provide adequate houses and jobs for the area’s burgeoning population.

It detailed the city’s current composition, providing a slew of scintillating statistics – 44 percent of Grass Valley residents are homeowners, 2.46 people live in each household, and the city offers 1.7 jobs per resident.

The second part of the study, released recently, calculates the costs of each type of land use. For example, houses, which pay only a little property tax but require sewers, roads, police and fire protection, and other services, each cost the city $525 per year.

But retail stores – which provide sales tax, the city’s primary source of income – bring in a whopping $3,274 per 1,000 square feet of space, about the size of an average Burger King.

The study emphasizes, however, that people who live in costly residences also purchase thingamabobs in the stores, providing sales tax that partially offsets the homes’ cost to the city.

Therefore, to have a top-notch community, Grass Valley should include a mix of big houses, small houses, apartments, condominiums, stores, office and industrial spaces, the report says.

The juiciest information – the optimal ratio of each type of land use – will be discussed in the third part of the study, due Oct. 15.

“I’m anxiously awaiting the third one,” Mayor Patti Ingram said. “I can’t say there was anything in that second one that stood out for me.”

Leaders like Ingram will rely heavily on the third part of the study to determine Grass Valley’s course – with the input of the community, they will decide how to shape the four major developments to potentially lift Grass Valley into the elite realm.

For more information, visit http://www.cityofgrassvalley.com. Click on “study” in the Special Development Area section.


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