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June 2012
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SLIPPAGE City needs honest look at reasons for decline

A Sunday article in The Paducah Sun pointed out a troubling statistic: Paducah's population has been in steady decline for 50 years. Further, that trend is unique compared to other Kentucky cities such as Bowling Green, Henderson, Madisonville, Murray and Owensboro, all of which have experienced growth over the same period.

The view in Paducah has long been that this is merely a phenomenon of the urbanization of the county - that McCracken County was gaining population at a faster pace than the city was losing it. There is evidence of that. Census figures show that over the past 50 years the countywide population has grown by 8,259 people despite absorbing the loss of 9,455 city residents. That means growth outside the city limits was 17,714 over the term. But that trend stagnated between 2000 and 2010, when the city lost 1,283 residents and county growth barely offset it with a net gain of 51 people. The trend has turned negative between 2010 and 2013, with the Census Bureau projecting that the county (city included) lost 192 residents during that period.

If one looks at McCracken County as an urban county, that is, as a single community, the 50-year trend is less troubling although far from impressive. We've had population growth of just shy of 14.5 percent over 50 years. But the continued loss of city population is disturbing. The fact that it is so unique among Kentucky cities ought to be a cause for some soul-searching.

The trend is a negative for business recruitment. Paducah Economic Development Chairman Chad Chancellor says the city's population slide "is the number one thing we're selling against." He said, "A lot of people think it's that we're not a right-to-work state, but the declining population is a bigger issue."

Sunday's story included some anecdotal thoughts from local officials about what may be driving the city's population loss.

There was discussion of lack of developable land inside the city limits. We have a hard time with that one. When people move from the city, they don't take their houses with them. The land issue could be a drag on growth but it doesn't in our view explain a population decline.

Others suggested it is a problem of young people leaving, and later, older people moving to be nearer to children who have left to find jobs. No doubt it happens. But it happens in every one of the cities that Paducah was compared with in the Sunday story. And that explanation doesn't square with the fact that the county has grown steadily even as the city population has declined. The phenomenon of kids leaving and parents following can't be one that is exclusive to inside the city limits.

We think the city needs to look elsewhere if it wants to honestly assess the trend and we think one place to consider is tax and regulatory policies.

The city now has a 2 percent payroll tax. It was 1.5 percent in 2004 when the city imposed a "temporary" half-cent increase that has since been made permanent. Thirty-three percent payroll tax increases don't inspire residency or business investment.

We'll also add our own anecdotal experience, from architects, contractors and business owners we've talked with, who say the city can be uniquely difficult to deal with when building or expanding a small business or opening a new business in an existing facility. We've heard enough to have concerns.

When cities don't grow, taxes and regulations are usually a factor. The fact that the county, which has lower taxes and less regulation, has managed to grow while the city faltered ought to say something. The fact that utility rates in the city are now also going through the roof is only added reason for concern about the future.

If the city wants to reverse its decline, it needs to take some positive steps. Tax and regulatory relief would be a logical place to start.

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