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taxes are levied too high, “it’s political dynamite”, and residents push back (or move away). In response, a large industrial park is slated to be built on newly-purchased municipal lands near the airport, approximately ten kilometres south of the town site. The development project comes as the Terrace municipal council looks to generate additional jobs and expand the industrial tax base. Many residents are optimistic at the prospect of renewed localized industry, as they lament the slowed productivity and closures of the town’s sawmills, which had historically represented a significant portion of the town’s earnings. The community has always benefited from its ability to leverage its airport — a gift of the allies in WWII with an eye on gaining access to the Pacific tradeways and on preparing for the future Cold War. The airport has an amazing history, and understanding that this resource has been key to Terrace’s development as a service centre, as a retail hub, as a travel destination, and now maybe in relation to the industrial activity, is key to any development strategy. Rather than focusing solely on creating revenues and doing something near the airport to fill a tax gap, one can imagine considering both the airport and the tax situation in the context of a broader strategy. Airports can be expanded, and can attract activities more directly adding value to the airport. All of this requires land, which is now claimed by industry.

We would argue that tax strategies can work, but mostly when considered against the background of a repertoire of instruments for strategy, and when a narrative can be instilled in governance that taxes are neither inherently good nor bad, rather, that the actual public benefits of public money have to be assessed, and the negative effects of certain types and levels of taxes have to be sensitively monitored as well. It is key to remember that taxes play an important role in providing the public goods of society — the streets, the sidewalks, lighting, parks, and so on. In many cases, these are the elements that make communities desirable locations for residents and visitors. Taxes, without framing by an overall vision for the community, cannot solve all problems. Without an understanding of alternative incentives or the power of actual coordination of governance decision-making, taxes become unreliable replacements for an actual strategy. This holds true for both the tax increase and tax decrease versions of the “tax story”. With the tax increase version, which simplistically equates more taxes with improved public resources, and more public resources as the best development tool, we would say that more revenue in the same governance configuration will likely not make much difference in an unstable resource community. Throwing more money at problems, without reflecting on the problem definitions, on the presumed solutions and forms of organizing, is very risky indeed. With the tax decrease approach, which equates lower taxes with economic growth, simply lowering taxes, without re-assessing the governance configuration and looking for root causes of issues or considering alternatives, is similarly risky.

Part V: Development approaches for inspiration and guidance

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