Perspective
How Cities Can Fund the Future
Local governments are far from broke—if they can tap their enormous market power.
There’s a huge question facing American cities, and, thanks to the recently enacted federal tax law, it just got more urgent: How are cities going to fund the future?
Cities stand to absorb a major financial hit from the new legislation. For the most part, the substantial reduction in corporate tax rates will mean fewer resources at the federal level to invest in those things—research-inspired innovation, quality infrastructure, skilled workers—that drive long-term economic competitiveness. The corporate tax rate reduction also has the effect of devaluing federal tax credits that have been used to raise private capital for low-income housing, historic preservation, and research and development.