2010

1 December 2010: CCC – Choosing harder right or easier wrong – Pt. IV

Choosing harder right or easier wrong

(Last in the series: Clear Creek: a Sustainable Community)

In a well-written essay in the November 22nd Newsweek titled “Truth or Consequences,” Evan Thomas argues President Obama needs to “talk straight about the looming economic disaster facing the country.”

“His only hope to be an effective president, to secure his legacy, is to tell the whole truth about the deficit, the debt, and the only real way out—to be, as he put it, ‘straight’ with the voters.

Thomas admits he might be whistling in the wind because as a species, Americans “are not amenable to sacrifice, to choosing the harder right over the easier wrong.”

Is that due to us being a can-do, pragmatic, problem-solving sort or because we prefer denial as a method of dealing with bad news? We can debate that along with solutions, but what is striking is its parallel to a financial Armageddon we are potentially facing in Clear Creek.

While the work of the President’s National Commission on Fiscal Responsibility and Reform, chaired by former Wyoming Senator Alan Simpson (R) and Clinton White House Chief of Staff Erskine Bowles (D), deals with the multi-trillion gap between revenues and expenditures, a presentation done by the Clear Creek Economic Development Corp. to the Board of Commissioners on October 27 expressed a similar sense of urgency with regard to the plight of the county.

The presentation drew upon statistics that compares CCC with other Colorado counties, both collectively and specifically, and analyzes the spread of the tax burden within the county itself: residential, commercial, and industrial.

It asks who’s paying the bills and wonders at the end about who will be paying the bills?

It began with the premise that counties dependent on a limited tax base—CCC—tend to experience boom and bust economic cycles. Compared to the other 63 counties, CCC is an anomaly in that less than 10 percent of its tax base is derived from commercial property compared to the state average of 19 percent, and less than 25 percent comes from residential compared to a 34-percent average statewide.

By contrast, neighboring Gilpin has a 67-percent commercial tax base and Summit, 19 percent, which makes sense given the gambling and ski interests in those counties.

In CCC however, over 60 percent of taxes come from one property: Henderson Mine. While the economies of Gilpin and Summit might be more dependent upon the vagaries of the overall economy given their chief products are recreational, CCC relies on one exhaustible, non-renewable commodity: molybdenum.

The study cites Floyd Hill as an example of non-incorporated residential areas regarding the portion residents pay to maintain their own roads. It shows Floyd Hill residents only pay approximately 53 percent of their road maintenance costs. The other 47 percent is subsidized, thus permitting those residents their way of life.

Across the county, a single-family home contributes on average $365 of the $10,899 tab it costs to educate one student. Collectively, SFH’s fund only 114 students’ education while CCC commercial properties pay to educate 517 students each year.

The Big Question before us, of course, is that of the Henderson Gap: How will we replace Henderson’s tax revenue when the mine inevitably declines in production due to its exhaustible resource or decreased market demand.

As noted in my June 30 column, a small decline in itself might not be devastating, but as it precipitously drops, as it assuredly will within the next two decades, it would take either more than doubling if not tripling of all residential and commercial current taxes, a massive boom in housing, to the tune of an estimated 2900 new homes based on a near $300,000 evaluation or 344 $2,500,000 “McMansions,” or business growth.

All that brings us back to our larger question: Is CCC a sustainable community? The answer can be yes if we work together to develop or allow assets to be developed needed to replace the Henderson share of the tax county’s and school’s tax bases.

Recall that one definition for sustainability is the Triple Bottom Line: People, Planet, Profit—people living healthy and comfortable lives in balance with Earth. No matter our political and philosophical perspectives, 83 percent of us—28: excellent / 55: good—agree CCC is an incredibly beautiful and wholesome place to live. Our job is to make that continue to happen so that our posterity will too enjoy living in such a community.

As does our national debate, the one about the future of CCC demands “straight talk.” Will we chose the “harder right” or the “easier wrong”?

To hear some straight talk, join me and my guests Commissioner Tim Mauck, Peggy Stokstad, President of the CCEDC, and board member David Elmgreen on KYGT on December 11 at 3:00.

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