George Is Smiling
Land Value Tax
The coffee was good here now. That was the first thing Marcus noticed when he walked into what used to be the vacant lot on Archer Street, now a modest café with floor-to-ceiling windows and succulents climbing the exposed brick. Three years ago, this corner had been nothing but cracked asphalt and a chain-link fence sagging under the weight of kudzu.
“You’re late,” Delia said from a corner table, not looking up from her laptop.
“I’m retired. There’s no late.” He slid into the seat across from her and signaled the server. “Besides, I had to walk. Couldn’t find parking.”
“That’s because they converted the surface lot on Fifth into that community garden.” She finally closed her laptop, a thin smile breaking through. “Remember when you said this neighborhood would be a ghost town by now?”
“I remember saying a lot of things.”
They’d known each other for almost a decade, thrown together by proximity and the strange camaraderie of people who owned property on the same declining block. Marcus had inherited his grandmother’s house, a sagging Victorian he’d planned to flip before the market collapsed. Delia had accumulated rental units the way some people accumulated debt, which, he supposed, amounted to the same thing in those days.
When the Land Value Tax passed in 2028, they’d both been certain it was the end.
“I pulled up my old emails,” Delia said, sliding her phone across the table. “From right after the bill passed. I sent you seventeen messages in one week.”
Marcus scrolled through the subject lines. This is theft. We need to organize. Have you talked to a lawyer? And his personal favorite: They want us to PAY for land we already OWN???
“I was dramatic.”
“You were terrified. We both were.” He handed the phone back. “I thought I’d lose everything. The house wasn’t worth much, but the lot next door, the one I’d been sitting on, I figured I could sell it when prices came back.”
“And instead?”
“Instead I got a tax bill for land I wasn’t using.” He laughed, though it had taken years before he could. “Twelve hundred a month, just to let weeds grow. The assessor came out, looked at the soil quality, the proximity to transit, the water access. Calculated what that dirt would be worth if someone actually did something with it.”
The server brought his coffee, and Marcus wrapped his hands around the mug. Outside, a woman pushed a stroller past a row of new storefronts. A bike lane, freshly painted, ran where parallel parking used to be.
“So what did you do?”
“What could I do? I couldn’t afford to hold empty land anymore. Nobody could.” He took a sip. “First I panicked. Then I called my nephew, the one who went to agricultural school. He had this idea about urban farming, vertical beds, hydroponics. I thought he was crazy, but I was desperate.”
“The lettuce place on Archer?”
“That’s him. Started in my backyard, then expanded to the lot. The tax on the land stayed the same whether he grew lettuce or let it rot, so we grew lettuce. Built greenhouses, hired kids from the high school. The improvements didn’t add a cent to what I owed.”
Delia nodded slowly. She’d heard pieces of this story, but never the whole arc. “I went the opposite direction. I had eleven units when the tax hit. Four of them empty.”
“I remember. You said it was smarter to wait for better tenants than to lower the rent.”
“It was, under the old system. Vacancy didn’t cost me much. Property tax was based on the building, and an empty building’s just a building.” She stirred her tea, watching the leaves spiral. “But land value tax doesn’t care if your units are full or empty. The ground underneath costs what it costs. Suddenly I’m paying the same whether I have tenants or not.”
“So you filled them.”
“I filled them in six weeks. Dropped the rent, ran ads, stopped being picky about credit scores. Turns out there were plenty of people who needed housing. I’d just been pricing them out because I could afford to wait.” She paused. “That’s the part that took me longest to sit with. I wasn’t a villain. I was just responding to incentives. And then the incentives changed.”
Marcus watched a city bus glide past, electric and nearly silent. The route had expanded twice since the tax, following the new density spreading outward from downtown. “You know what I keep thinking about? All those parking lots.”
“The ones downtown?”
“Everywhere. All those flat, paved squares where nothing happened. The owners weren’t stupid. Land was expensive to develop but cheap to hold. So they held it. Waited for prices to rise, collected a little parking revenue, let the city stagnate around them.”
“And now?”
“Now holding land costs money. Real money, based on what that land could be.” He gestured out the window. “So they sold, or they built, or they partnered with someone who would. That’s why you can’t find parking anymore. All the lots turned into something.”
Delia leaned back in her chair. “My brother-in-law is an economist. He keeps sending me papers about deadweight loss and optimal taxation. I don’t read them.”
“But you understand it now.”
“I understand that I used to pay taxes on the things I created, the buildings, the improvements, the labor I put into maintaining them. And that made me not want to create things.” She met his eyes. “Now I pay taxes on the thing nobody created. The land. The location. The value that comes from roads and schools and neighbors and everything else the community built together.”
“And that makes you want to use it.”
“It makes me have to use it. Which turns out to be the same thing, in the end.”
The café had filled around them, young people on laptops, an older couple sharing a pastry, a group of what looked like city planners spreading maps across a table. Marcus remembered when this block had been so quiet you could hear the traffic from the highway a mile away. Now the highway was gone too, converted to a linear park after the congestion pricing made it redundant.
“I’m not saying it solved everything,” he said.
“No. But it solved more than I thought anything could.”
They sat with that for a moment, two people who had once believed they’d been robbed, now watching a city reassemble itself around the simple principle that land belongs to everyone who makes it valuable.
“Same time next week?” Delia asked.
“If I can find parking.”
She was already laughing as he walked out into the afternoon sun.