Bangalore Civic Services: Cash and Carry? Part One

 There is an anonymous civic group(leastwise, I think it's a group!) in Bangalore called The Ugly Indian, which has transformed many "Ugly Spots" into clean areas with an emphasis on sustainability through the involvement of local stakeholders like businesses, homes and city workers. Their motto is "Kaam Chalu Mooh Bandh", which roughly translates as "Close your mouth and work", referring to their preference for anonymity. The core proposition is that when government is not up to the job, the citizens should step up.

  Of course, all such activity is certain to bring up the issue of whether private citizens should be doing the work that city government collects taxes to provide as a service. That debate on Facebook turned a bit lively, and TUI brought up the question of whether the house/property taxes, modest in relation to property values, were sufficient to warrant the services which people expect from the city. I wrote back, if I recall correctly, that while the taxes were admittedly low in relative terms, one needed to be sure that submitting to a higher tax rate would not simply result in the city administration siphoning away the added money, without providing promised services, and also take into consideration that many property owners were "house rich, cash poor", as it were. TUI then asked me to expand on my remarks, which I promised to do in a blog post, as I had too much to say to put into an FB conversation. So here- better late than never!- is my take!

  A maxim of city planning is to plan for the future, rather than just for the present. The thrust of Indian city “planning” has been to address yesterday's problems. Bangalore has been no exception to that rule. My experience of Bangalore has been that each passing year brought declining levels of service from the city administration, from trash disposal to street maintenance to animal control. Likewise, BWSSB, the autonomous water utility, has also deteriorated with each year. The hallmark, if you will, of the failure of these services has been the lack of foresight and, more importantly, the corruption and lack of will on the part of these agencies.  I wrote about this in another post.

 The crux of TUI's question was this: do you think that the current taxes justify your current expectation of services and are you willing to pay more in taxes in order to receive a better level of service? Both points require a more nuanced response than a simple yes or no. To the first, there is no doubt that the total revenues generated by the city are insufficient to adequately provide services on a level commensurate with the ambitions of a "world class city" or, indeed, of a second-world city. But, more importantly, are they getting the level of service now that the taxes warrant? Those of us who live in better neighborhoods need to be more cognizant of the services provided in less-affluent areas, and not assume that the same level of service, however unsatisfactory it is, obtains citywide. As the saying goes, the squeaky wheel gets the grease, and the more affluent generally have a greater ability to get their squeaks heard.

 

  TUI noted, with a degree of optimism, that the average home in the Indiranagar neighborhood was worth close to a million dollars, while the average property tax was less than two hundred dollars a year. I would be inclined to value the average home in this area at closer to half a million dollars, which is still quite substantial. But the value is in the land, not the home, and rarely does the value of the house figure into an actual selling price. Moreover, many of the long-term residents are retired civil servants, ranging from police officers to civil service officials to military officers. These are people of modest means(current government salaries seem positively luxurious in comparison), and now survive on modest pensions of three or four hundred dollars a month. Not your typical million-dollar homeowner. Doubling or tripling their property tax might force them to seriously consider selling the homes they built with every intention of living out retirement here with their circle of friends and family.

 

These are homes on a street in Indiranagar, which sit on lots currently worth in the neighborhood of $500,000. Do they look like half-million dollar homes?

 

 Typically, someone who lives in a million-dollar home in the US would have an income north of $250,000. On my street here in Indiranagar, perhaps three residents fit that bill. One is a businessman, another is a builder and the third is a politician/restaurateur, and each of them have multiple homes. Of the rest, I honestly don't think anyone makes more than $50,000 a year, and most make probably between $6,000 and $20,000. As I said, house rich and cash poor. That said, I think most of them would be able to withstand a doubling-or even tripling- of property tax without too much stress, but allowances must be made for pensioners and others on fixed incomes.

Please go on to Part Two.