C. Kurt Zorn

The Evolution of the State and Local Government Municipal Debt Market over the Past Quarter Century

Much has happened in the municipal bond market during the past 25 years. This article provides a retrospective of some of the significant developments in the market during that period of time. These developments include passage of the Tax Reform Act of 1986, innovations in the market in response to changing economic and social conditions, and the regulation, increase in disclosure requirements, and proliferatioin of credit enhancements that renewed the efficacy of municipal securities for American state and local governments.

Variation in Property Tax Abatement Programs Among States

This research provides an exhaustive review of U.S. property tax abatement programs and identifies and compares critical structural differences of abatement programs across states. Program differences are much greater than the existing literature recognizes. As a result, perhaps the most comprehensive database on the diversity of property tax abatements is offered to practitioners who are considering the design of a new abatement program or the revision of an existing one, as well as to researchers interested in furthering research on the effectiveness of this policy tool. For each of the identified abatement program features, advantages and disadvantages are discussed in light of existing literature.

Impact of the Sales Tax Rate on its Base: Evidence from a Small Town

Local governments and businesses fear that increased local sales tax rates will induce losses to the local economy, even inducing losses so severe that no additional revenue will result from a higher tax rate. Earlier works by Fisher, Hamovitch, and Mikesell have examined sales loss in metropolitan areas, typically finding significant but not overwhelming effects. Those results do not address the question for small cities and typically are complicated by the expenditure effects resulting from the increased tax revenues. The present analysis uses unique data for a small town to examine the impact of a temporary sales tax rate increase with a retail sales share model. The evidence shows a significant but small sales impact that did not endure (a differential of 1% would lower city sales by 3.07%) and no impact on vendor location. The unfavorable rate differential produced a short-run effect, but not economic disaster.

Diversifying Local Government Revenue in Bosnia-Herzegovina Through an Area-Based Property Tax

After a bitter and devastating war, Bosnia and Herzegovina is making slow but steady progress rebuilding its economy and government structure. As normalcy returns, the demand for government services invariably will continue to increase, especially at the sub-entity levels of government. Unfortunately, the current fiscal structure severely restricts the resources available to local governments. This article suggests that Bosnia and Herzegovina consider adopting a property tax as a means to provide much- needed revenue. After describing the current governmental and fiscal system that has evolved since the signing of the Dayton Accords, the authors discuss why an area-based property tax, rather than a more traditional property tax based on capital value or market prices, makes sense for this country in transition.

A methodology for comparing manufacturing industry costs at the state level

Abstract This article develops and applies a methodology for a comparative cost analysis for manufacturing industries. Location variations in labor, energy, transportation and tax costs are analyzed for representative firms constructed for the twenty two-digit Standard Industrial Classifications. The results of the analysis include an estimate of the interstate variation of these business costs for manufacturing industries and an idea of the relative importance of these four business cost components among industries and across states.

The price tag of economic development incentives: is it too small for citizens to care?

This article explores the impact of property tax abatements on tax rates. Using the case study approach, the research uses data from Monroe County, Indiana, and finds that the impact of abatements on tax rates is negligible. The method consists essentially of calculating the difference between actual tax rates and hypothetical tax rates assuming abatement are not awarded. The results suggest that public officials may see in abatements a symbolic and relatively harmless policy tool for purposes of garnering political support from businesses and citizens. The article discusses these findings in light of current law suits brought against prominent abatement programs.

The Airport and Airway Trust Fund: A Continuing Controversy

Despite calls for increased outlays from the Airport and Airway Trust Fund to help finance improvements in the nations air transportation system, the funds surplus continued to grow during the Reagan years. It becomes readily apparent, when the issues surrounding the trust fund and its surplus are analyzed, that placing the blame solely on deficit considerations is too simplistic. Instead, partisan politics, the congressional budget process, delays in technology development, and budget pressures are responsible for the growing surplus.

Aviation safety in the age of liberalization: A Critical Assessment

This chapter analyses the safety record in the era of aviation liberalization. The chapter describes different types of liberalization and how aviation safety performance might be affected. Effects of industry growth, industry structure, and the regulatory environment are discussed. The pre- and post-safety records for specific country and region liberalizations are analysed. Overall, we find improvements in aviation safety following liberalization, especially for scheduled services. The safety record does vary by region and by industry segment. The relatively poor safety record of non-scheduled charter services in both developing regions is identified. The challenge for aviation safety is that an increasing share of fatal accidents involves regions and airlines where little information is available to help understand and improve safety performance.

The Economic Perspective on Public Administration

Public administration as a body of thought and field of study is changing from a paradigm dominated by political science to an eclectic array of theoretical contributions from all of the social sciences, particularly economics. Basic education and training in economics is essential to an effective contemporary public administration. Without a fundamental understanding of economics the “do-it-yourself-economics” which is practiced in policy-making contributes to basic errors in policy. As the size and significance of the public sector has grown, increased attention has been paid to the discipline of public administration. What began as a structured way of describing the operation and structure of public management and public organizations has evolved into a discipline that has a much broader scope—the analysis of policy making in the public and not-for-profit sectors. In addition, employment in the public administration profession is more likely to be viewed as a vocation rather than as an avocation, in co...