“When . . . a large development wants to be in your town, you see the tax values surrounding that. . . I think the tendency is to think this is really going to give us a solid foundation,” George Fowler, mayor of Pineville, North Carolina, told the Charlotte Observer. “But you don’t realize at that particular point the impact it’s going to have on the services you have to provide.”
Pineville is one of a growing number of towns that have added large retail stores in recent years only to find that the stores do not generate enough tax revenue to cover their impact on public services, particularly police costs.
Over the last decade, Pineville has attracted six million square feet of new retail, including a major shopping mall, big box stores, chain restaurants, and gas stations. Many communities aspire to have such a large commercial tax base in order to keep residential tax rates low.
But Pineville, home to 3,400 people, is struggling financially. The town takes in $2.3 million in property taxes, but spends almost all of it—$2.2 million—on its police force. The police spend most of their time dealing with crimes like shoplifting, bad checks, and credit card fraud originating at the shopping centers. Commercial property accounts for 96 percent of all police calls.
Desperate to control rising costs, Pineville has put the brakes on retail growth. It recently tightened its zoning rules and turned down two retail developments, including a Wal-Mart supercenter. The town concluded the store would require hiring two new police officers at a cost of $120,000 per year, but would generate just $100,000 in taxes.
Pineville hopes to attract more residential growth, but the traffic congestion and retail sprawl have made the town less attractive to families. Last year Pineville raised its residential tax rates.
Other towns struggling with rising public safety costs include East Lampeter, Pennsylvania, where District Justice Ronald Savage has added two days to the monthly court calendar just to deal with crimes at Wal-Mart, which account for about one-quarter of the town’s non-traffic citations, criminal misdemeanors, and felony complaints.
The volume of police calls in West Sadsbury, Pennsylvania, jumped 27 percent following the opening of a Wal-Mart. In Vista, California, Sheriff’s Lt. Grant Burnett says shoplifters at a new Wal-Mart have been a major contributor to the 24 percent rise in the town’s crime rate.
Downtown business districts do not generate the same level of crime for several reasons. They are not open 24 hours a day. Criminals passing through seem to prefer the anonymity of a Wal-Mart store along the highway to the intimacy of Bob’s Hardware on Main Street. Local retailers, moreover, do not call the police for every bad check or shoplifting incident, while chain stores have a policy of prosecuting every offense.
