Anatevka, Aventura Print
Written by Jay Beskin, BT Contributor   
June 2020

The city’s economy has a good chance of recovery

 

Aventura, Aventura.

Underfed, overworked Aventura./ Where else could Sabbath be so sweet?

Aventura, Aventura.

Intimate, obstinate Aventura./ Where I know everyone I meet.

Soon I’ll be a stranger in a strange new place/ Searching for an old familiar face/ From Aventura.

I belong in Aventura/ Tumble-down work-a-day Aventura/ Dear little village, little town of mine.

 


WPix_JayBeskin_6-20ith apologies to the great Yiddish writer Sholem Aleichem, and the creators of Fiddler on the Roof, the great musical based on his character Tevye the Milkman, I changed the town name in the song Anatevka to my own burg of Aventura. Sholem Aleichem (1859-1916) died in New York City not long before the last major pandemic, the Spanish flu, killed tens of millions beginning in early 1918.

When this pandemic hit, I had to wonder if Aventura would be left standing on the Day After. With a lot of older residents, the city could have been devastated medically, and if the malls would get wiped out, one shudders to contemplate the result. Would we all be sent into exile to find one more pasture, certainly not greener but perhaps almost as green? Would we be singing a dirge about our old hamlet, Aventura, as we trudge off into a murky horizon?

Well, the coronavirus episode is far from over, but the main economic impacts appear to be discernible. At this point, we can put a hesitant toe into the water and try to offer a prognosis of sorts for the fiscal health of our city over the short term, with perhaps a glimmer of insight into the longer term as well. The reports of our demise have definitely been exaggerated, to an extent, but there are sad elements. Still, the bottom line suggests we will live to fight again, and perhaps even prosper.

What held the spirit of Anatevka and places like it was the rebbenyu. That was a term of endearment used to describe a beloved rabbi. If the people were happy with the rebbenyu, and they felt he cared for them in all their travails, they could endure almost any adversity.

In the absence of that sort of blessing, the key to hopefulness in smaller municipalities is the revenue. As a result, the impacts of epidemics on localities differ enormously from place to place, depending on how individual sovereign entities structure their revenue.

For example, if a particular city lives off sales tax, tourism taxes, hotel fees, and airport fees, imagining itself to have a fairly diverse range of incomes, it can find itself in real danger of bankruptcy after a pandemic that shuts down foot traffic, store and mall shopping, hotel stays, and airplane flights. We all know municipalities like that in Florida, some not terribly far from our own borders. Some of those places, if they have not stashed away reserves, may find themselves scraping the bottom of the barrel in a desperate effort to get by.

Another potential victim of the downturn after the outbreak is the municipality that relies heavily on taxing businesses, especially those that occupy a lot of office space. This strategy works when business is good and people are working out of their offices. This pandemic gave a double whammy to areas like that, because (a) many businesses are underperforming and some have not even been open; and (b) even the businesses managing to stay open are using less office space, with large swaths of the workforce doing their work remotely, from home.

College towns have taken perhaps the biggest hit among smaller municipalities. All around the country, we have charming outposts of academe, towns with an entire multilayered economy built around students, professors, administrators, textbook sellers, coffeehouses, and watering holes. Most colleges and universities are currently shut down with no on-campus in-person course delivery, and the towns that house those institutions of higher learning and lower carousing must now scramble for makeshift alternatives while they wait for the ability to invite the students back to their classrooms and dormitories.

Something similar is true for company towns, if they accompany the wrong company. If your burg backed Burger King, you should be fine, ’cuz we all gotta eat, but if you all used to work at the factory that makes the overpriced souvenirs at Disney, you might find that your theme is parked for the next little while. However, if you are doing fulfillment at Amazon you may be more fully filled than before. Not to mention tech-type things, which are actually more needed when people are trapped at home and must have others do unto them what they would do unto themselves, which means both that “tech is golden!” and that “tech rules!” Who knew?

But closer to home, the prognosis for Aventura looks to be at the very least manageable, with possible upsides beyond that level. First of all, we have $18 million in reserves. The truth is that citizens are generally less than thrilled when city government overtaxes them and then deposits the overage in a big piggy bank. You can bank on people calling the city commissioners piggy when that happens. I know, I was a commish myself back in the day. In the current circumstances, however, folks are thrilled to have that cushion. Riddle me this: When is the one time everyone appreciates a rainy day fund? Answer: On a rainy day!

The revenue structure in Aventura is built on property taxes and franchise fees (cable contracts, etc.). The property should retain its value pretty well, and the only distressed owners who need some tax forbearance to get through the period will be small businesses who own their storefronts, or small storefront owners who cannot collect rent from weakened small businesses. The hit should be minimal, and the rainy day money should not leave us high and dry.

As a side note, the fact that Florida fared fairly well in the pandemic -- No. 9 in cases and No. 11 in deaths for the No. 3 population -- can only enhance our property values in the longer term. We may have a degree of slowdown in real estate transactions for a few months, just because the sales part is people-oriented and has trouble thriving without people slapping each other on the back or hugging.

But beyond that, we should see an uptick in prices soon, maybe even an upsurge. On the other hand, maybe we should build a wall to keep those pesky New Yorkers and Chicagoans out. Does that sound like a winning platform? Not in my Anatevka.

 

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