Tuesday, October 18, 2011

Vernon, CA, ctd.

Earlier this year, Tanya had a nice post on Vernon, California, a small city on the outskirts of downtown LA. To recap, Vernon has only 95 residents but is home to 1,800 businesses.  Industries locate in Vernon to take advantage of its low taxes, lax regulations and cheap municipal power.  Also worth noting for property scholars is that the full-time residents (and sole voters) live in small homes, most of which are owned by the City. 

Yesterday, the L.A. Times unearthed fresh allegations of corruption against city leaders.  In the last five years, Vernon has paid more than $3.7 million to maintain and refurbish the residential properties while taking in only $472,000 in rent.

The city can engage in this kind of malfeasance because it takes in an enormous amount of property taxes from the business located in its borders, and has no requirement to provide services to the 55,000 workers who work in Vernon and live elsewhere.  Exclusionary zoning wins again.

Steve Clowney


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