Mon, May 15, 2000 - Page 8 News List

Who pays the price for progress?

By Fu Chuan-hsun

The Hsinchu Science-based Industrial Park (新竹科學園區) has caused major problems with the local environment, traffic conditions, and educational system. The local public infrastructure, as a result, is becoming inadequate to meet local demands. The local government, in dire financial difficulties, is unable to deal with the problems.

The Hsinchu City mayor held a press conference at the Legislative Yuan calling for public attention to the problem. He has additionally proposed three solutions, one of them being the establishment of a system under which the businesses in the park would repay the local community. Another proposed solution is to have the central government directly deal with the problem or appropriate more funds to the local government to do so.

Putting aside the issue of whether it is fair to charge "community development funds by construction projects (工程受益費)" or the so-called "Township Chief Tax (鎮長稅)" in Shihchih (汐止) and whether their application is fair and practical, their existence reflects the local government's severe financial shortage for maintaining the local infrastructure resulting from community development.

The controversy surrounding the Hsinchu Science-based Industrial Park is indeed worthy of examination. Is it now time to establish a judicious and transparent financial collection system to prevent the emergence of community development problems in the future? Let us first take into consideration some measures adopted by local governments in the US.

Developers of a new communities in the US (either a residential or industrial community) must first pay so-called development fees or "clash" fees to the local government. The local government applies the income collected this way to the construction of infrastructure related to the development of this new community, such as widening or increasing the number of roads and underground sewers as well as increasing street lights, tap water systems, and possibly parks. The income may also be use to deal with the resulting problems with the environment and traffic.

Actually, the US government has an even more important source of income -- property tax. Why don't local governments simply raise the property tax to pay for the additional expenses? The main reason is that the community in question is simply part of the greater area under its jurisdiction. Any increase in the property tax would have to be applicable to the entire jurisdiction. It is illogical and impractical to force residents outside the community to bear the additional costs for infrastructure incurred as a result of the development within the new community.

Every area has an optimal population size. The area will become crowed if the population is greater than this optimal size. As a result, many environmental and transportation problems will be created. Undeniably, the establishment of the Hsinchu Science-based Industrial Park has contributed to local education and the overall prosperity of the Hsinchu area. However, as pointed out by the Hsinchu City government, the existence of the park has expanded the size of the local population, and caused a financial shortage for the local government. For one, the increase in population has led to the need to establish more primary schools which, in turn, has led to an increase in salaries for the teaching staff. Before the local tax regulation is passed, community development funds from businesses or the "clash" fees may indeed be a viable option under the circumstances.

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