These are the housing communities and residents local governments want.
This also exacerbates the challenges to sustaining their public employee pensions. Especially at the local government level. Welfare or teachers is a challenge in many places these days.California is the national leader in welfare recipients. About 3.8 percent of state residents were on welfare in 2010, the highest percentage in the country. In fact, California houses about a third of the nation's welfare recipients, while only housing one-eighth of the national population.
The comparative amounts of median household net worth across age groups has remained relatively constant proportionally from 1990-2010.
The percentage of population on welfare is not a driver WRT to tax revenue. The drivers are tax rate and overall taxable income and taxable property in the State.
One of the main drivers in revenue fall for the States and localities is the drastic drop in home values, resulting in lower property tax assessments .
US household net worth is tied almost completely to home value for the overwhelming majority of people. Therefore as net worth drops, so does local and state revenue. Remember you are not taxed on the value of your 401K portfolio, but your home and other personal property (vehicles in many States besides MD) are fair game.
In many places in Maryland, the property tax paid by a household likely far exceeds the income tax paid, including the county piggyback tax.
You are taxed on your 401/403 at normal tax rates upon withdrawal with MRD's starting at age 70. So to illustrate my point. A person works in Maryland for 35 years. Saves a considerable sum in a tax deferred account and upon retirement transplants to another state. At some point between retirement and 70.5 they begin to draw their account down. It will not be Maryland that receives those taxes it will be their new state. Make that person a public employee and a government in Maryland paid them without getting any taxes back on the money they invested in their 403(B). I know that personally.
Like I said before, a shortfall in revenue needed to pay for statutorily required spending is a consequence of too low tax rates
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