Proposed House Flipping Legislation

[TheAnk]

Ideally, most people within an economy will be doing things that are productive -- that sustain lives, create happiness, etc. Why do we want to pay people to move money around, when we could pay them to teach, or repair the transit infrastructure, or even paint paintings or do any of a million other things instead? Either scenario yields jobs, spinoff, whatever. But one scenario has immediately productive effects, and the other creates middle-men.

[Cotuit]

The rational behavior is get the government to pay for you to live for free..

[jencoleslaw]

Sign me up for that. And if the government would deliver ice cream to me weekly that'd be great. Thank you!

[TheAnk]

With no middle men, does the $1 to $4 econ creation model exist? Me thinks no.. But hey, what do I know.. Apparently the world would work better in a barter system with no middle men..

If anyone is interested.. I have a bunch of seashells (conch) that I will trade for a piece of metal that I can form into a "cutting instrument".. I'll be at 100 Lennon Way, Utopia, PA..

I mean this in the least offensive way, but just as I come across as crass in text, I can only assume Segal comes across as out of touch via text.. I just don't understand his thinking, or follow the logic, and I am not being combative.. I am serious. I'm sure in person he is different. I mean, how else could he come up with the genius move of mobilizing Brown students to vote??

Back to reality though, why not make open bidding for tax credits for specific buidlings in need of repair.. I think there has been enough success with these projects that a free market situation could work.. Make the developers bid down the credit.. Most productive (with approved design review) wins..

[TheAnk]

One last thing.. And maybe I'm just spitballing here... Hey why not try to reduce the most debilitating tax on the middle class, the property tax??

Very simple, you can be PRESIDENT if you can make us happy... Just make the middle happy. No one cares about us.. All you politicians do is take from us and push it up and down.

You all try to rally the middle for one side or the other, poor or rich.. Why not just fight for the middle?????

Is it too simple to be genius? Too genius to be simple? Or are we the cash cow used to finance government? The third rail of politics.. I'm going to run on the platform.. "Why the government does not care about regular people." You think I'd lose? Doubtful.. Everyone considers themselves "regular".. (Unless they are "disabled" of course)

[Cotuit]

I read that the NJ legislature just voted to reduce thier property tax 20% (?). And it was a bill from the democrats that they had to get the republicans on board with.

[Dan]

Sign me up for that. And if the government would deliver ice cream to me weekly that'd be great. Thank you!

[Frankie811]

A lifelong

[TheAnk]

Seller: SWAP Inc & Stop Wasting Property Buyer: Southside Gateway LP N/A $391,000 2/28

Is this flipping? Government sponsored flipping? 391k huh.. Interesting.. Flipping is bad as long as it is not by "non-profit" gov sponsored entities.. Good to know.. Can I get an update on this? Did people laugh Segal out of the room? I have never seen such a concentration of horrible ideas come from one individual in such a short timeframe..

By the way, how has everyone been doing.. I needed a few months to cool down.. It makes me suicidal or homicidal, not sure which, when I see that people like Segal make decisions for many people..

I feel like The People's Atlas, wearing the weight of horrifically stupid decisions made by folks like him because the people do not know.. They do not know the harm caused.. In fact, can I change my ID? Or at the very least can I be referred to as The People's Atlas? Thanks..

[ruchele]

Seller: SWAP Inc & Stop Wasting Property Buyer: Southside Gateway LP N/A $391,000 2/28

Is this flipping? Government sponsored flipping?

[eltron]

This is not "flipping." When a non-profit develops properties, each project gets transferred an independent subsidiary. This keeps each project's financial sitution separate from the finances of the NP. It also allows the NP to develop financial or management partnerships with other members of the LP. For-profits do the same thing. "Flipping" means buying property cheap, making little or no improvements, and selling it for way more than you bought it for.

[TheAnk]

My point with this SWAP posting is.. Why do they get to buy land at far below cost, and improve it, tax free. Then "sell" it.. Do you think this is any different than what I do? No.. Only they can do it at a fraction of cost.. I accept Section 8.. I offer affordable housing.. Why can't I do it tax free like SWAP??

I am confused, maybe from being absent for a while I'm out of touch.. Flipping to me is some made up term that does not exist.. For the few criminals, if any, that can pull this cooking the books off, I say all the power to them.. Thats the American way..

But you and I both know that fellows like myself will be conveniently lumped in here and profits inordinately taxed.. No thanks.. Segal, go tax your East Siders and leave us in the ghetto alone.. Call it "green flipping" or something, make it a charity.. People will line up to give money..

[ruchele]

Why can't I do it tax free like SWAP??

[xine]

Why can't I do it tax free like SWAP??

[eltron]

My point with this SWAP posting is.. Why do they get to buy land at far below cost, and improve it, tax free. Then "sell" it.. Do you think this is any different than what I do? No.. Only they can do it at a fraction of cost.. I accept Section 8.. I offer affordable housing.. Why can't I do it tax free like SWAP??

[DavidSegal]

Damn this new laptop of mine... littlest bout of insomnia, and I'm on UP for an hour at 4am.

When nonprofit developers transfer properties from one of their arms to another, the selling entity doesn't make a profit. Hence, no tax. The law has been on the books in VT for quite a while, functioning well, crafted in part by non-profit developers. And the local non-profs have been at the table throughout the RI conversation.

Ank- If you offer affordable housing, it should be easy for you to incorporate as a non-profit and get treated like SWAP. Go for it. I'll find somebody to walk you through the paperwork. (But undertand that then you won't be able to _profit_, Everyman that you are.)

Flipping was defined quite nicely by Ruchele.

[DavidSegal]

It sounds like a decent idea, and is more-or-less what I meant earlier in this thread, when I said I'd like to look at skewing the historic tax credits more towards affordable housing. Also, as I was saying before, the credit system doesn't strike me as the best way to fund things -- anything, really. Especially as the value goes down because there are so many on the market and the state's been cutting taxes for the rich, which'll further reduce demand for the credits.

You may think it's a pipe dream, but one of the reasons I voted for Kerry in the last presidential election was his Senate Bill S.875 which would give private developers federal tax credits for improving properties in areas with low median incomes and other "distressed" areas as determined by the state (read "places just like Olneyville") as long as the residences were sold to people with 80% median income. This particular bill is dead but it enjoyed some bipartisan support and morphed into S.859 sponsored by Sen. Santorum(invountary shudder). The language appears similar but it too is dead for now.

So - that's basically the opposite approach to Mr. Segal who I'm sure is genuinely passionate about affordable housing - though the would-be Senate approach uses a big juicy carrot instead of a pointy stick.

Just goes to show that all sort of interesting stuff happens in Washington that no one gets to hear about.

[DavidSegal]

WHether they are good or not is irrelevant... You missed my point... The State absorbs a loss of taxes (albeit the taxes are NEW taxes that did not exist before) while the City, such as Providence or Woonsocket or West Warwick, where the vast majority of the people live, see large gains in tax base. The Tax Credit becomes a vehicle by which high property taxed properties are brought on line due solely to the use of the RI Credit. It's okay for the State to lose "found" revunues while adding cash to municipal coffers.

[DavidSegal]

Ankus-

Your screeds represent an incredibly poor understanding of economics, especially given the conservative lens through which you pruport to observe it.

It's pretty much universally agreed upon that the point of an economy is to produce and distribute the goods and services that members of the given society want and need. (Like, if you argue against that, then you're arguing against Karl Marx and Milton Friedman at the same time.) I'd also assert that it's desirable to have an economy that does this as equitably as possible.

When we spend money on things that don't further the ends of producing and distributing said goods and services, we're being inefficient. This means we want as little rote paper-pushing as possible, and as much production of stuff that satisfies needs and makes people happy.

So, as in the case at hand, when we have the choice between paying people to move paper around versus paying them to teach, or drive a bus, or plant a tree (or even, yes even, letting the taxpayers hold onto the money that would be spent pushing paper), we should choose from among the latter.

A case study:

The state has a dollar and needs to buy a can of soda. We can buy a can of soda from the vendor for 75 cents. The extra 25 cents can go into the Neighborhood Tree Planting Program. (Shout-out to Jen. Woo-hoo!)

Alternatively, in Ankdom, it somehow makes sense for the state to pay a dollar to Harry, so he can take a nickel and give 95 cents to Dan, so he can take a nickel and give 90 cents to Jenny, so she can take a nickel and give 85 cents to Philip, so he can take a nickel and give 80 cents to Anna, so she can take a nickel, pay 75 cents for the soda, and give it to the state.

This is not a meditation on whether or not money should exist. Can you really not see the difference?

With no middle men, does the $1 to $4 econ creation model exist? Me thinks no.. But hey, what do I know.. Apparently the world would work better in a barter system with no middle men..

If anyone is interested.. I have a bunch of seashells (conch) that I will trade for a piece of metal that I can form into a "cutting instrument".. I'll be at 100 Lennon Way, Utopia, PA..

I mean this in the least offensive way, but just as I come across as crass in text, I can only assume Segal comes across as out of touch via text.. I just don't understand his thinking, or follow the logic, and I am not being combative.. I am serious. I'm sure in person he is different. I mean, how else could he come up with the genius move of mobilizing Brown students to vote??

Back to reality though, why not make open bidding for tax credits for specific buidlings in need of repair.. I think there has been enough success with these projects that a free market situation could work.. Make the developers bid down the credit.. Most productive (with approved design review) wins..

[eltron]

When non-profit developers transfer properties from one of their arms to another, the selling entity doesn't make a profit. Hence, no tax. The law has been on the books in VT for quite a while, functioning well, crafted in part by non-profit developers. And the local non-profs have been at the table throughout the RI conversation.

[TheAnk]

"So, as in the case at hand, when we have the choice between paying people to move paper around versus paying them to teach, or drive a bus, or plant a tree (or even, yes even, letting the taxpayers hold onto the money that would be spent pushing paper), we should choose from among the latter."

First.. Less paper pushing I agree is more productive.. Of course. Then why, may I ask, are you looking to push house flipping legislature? Would this not be more paper pusing and less efficiency? Oh, I see.. Your idea of distribution of goods is RE-distribution of goods from profit seekers to non-profit seekers.. Take from those who are ambitious and hard working, and give to those who are less ambitious through goverment taxation on success.. So THIS paper pushing is good.. I am sorry, I misunderstood you before..

Also, house flipping in all its gentrification glory produces a GOOD, livable housing.. (I refuse to accept your definition of flipping as paper transaction only, it is far fetched at best) So not only does your legislation hinder growth through additional paper pushing, it also restricts the production of usuable housing.. Well done there...

RE: Ankdom

I see.. So in your world, a society can exist successfully with no incentive to advance.. The dirty little secret about life is this.. And the sooner you realize this the better off you will be.. The fittest survive.. As cold as that may sound, there is no changing it..

And by trying to save the few people that rightfully need help through vast widespread social programs, that say 3% of rightfully needy society is obliterated by the 20% of society who will try to get this "free money".. Because that is the rational behavior for the people.. Any economist will tell you this..

I am willing to accept that in certain instances, everyone needs help.. I am also will to accept that there is a certain percentage of our population that generally needs help, and very well could do so for the duration of their life.. I am not willing to accept, that the current system is even remotely efficient.

And when someone who is trying to introduce paper pushing legislature because he thinks that it will add to productivity questions my understanding of economics, well.. I guess that makes me speechless..

Your PPL is akin to casting a shrimp boat net to catch a six pack plastic ring floating in the ocean.. Yeah you may get that six pack ring, and you might also save the one fish that would get caught in it.. But you also catch 10,000 well to do shrimp.. On the flipside, welfare follows the same model.. The needy get caught in the net, which is good.. But the rational behaving free money seekers do also.. And there are far more of them..

I understand people have good intentions.. I understand the notion of helping those less fortunate and agree with it.. But what we do now does not work.. And when I see people like Segal are in office, I know why..

[DavidSegal]

Mike-

You've been concerned about tranfers from various corporate entities within the same nonprofit. That's what I'm addressing here. When would one arm of a CDC sell a property to another arm of that same CDC _for a profit_?

Dave,

This is not correct. Often times, nonprofit developers gain on the transfer of the real estate - just like a for-proft. In fact, the ONLY difference between a nonprofit and a for profit developer is that the nonprofit is board governed (by the community) and "profits" are redistributed to the community and not to owner's or shareholders.

Tax is definitely paid on real estate transfers by non-profits.

[eltron]

Mike-

You've been concerned about tranfers from various corporate entities within the same nonprofit. That's what I'm addressing here. When would one arm of a CDC sell a property to another arm of that same CDC _for a profit_?

[TheAnk]

Ladies and gentlemen.. Mr Segal is an elected official.. He makes decisions for his constituents and does not know basic economics or tax law in his own state and city.. If you did not know why I am a libertarian, well, now you do..