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Target Store and the Dilemma of Trotwood

By Marlon Aldridge on 2/7/2014

Target Store and the Dilemma of Trotwood

By Marlon Aldridge, Sr.

According to a press release on its web site, Target Department Store in Trotwood, Ohio will close on May 3, 2014. Several other retailers in Trotwood have closed such as Best Buy, Cub Foods, Kmart, Walmart, and Sears which will close soon. The only other large retailers that remain are Lowes, Home Depot, and Office Depot. Target, which is publicly-traded and headquartered in Minneapolis, cited declining 2013 profits possibility related to a credit card data breach it uncovered.

As I have said before, publically-traded companies are subject to shareholders who care more about dividends and capital appreciation than the desires of consumers. I suspect that regardless of the appeals of Trotwood officials and residents, Target will close as scheduled. The city will continue to struggle to attract other large retailers because Trotwood’s demographics do not fit the targeted demographics of larger corporate retailers. See my previous article, Should We support Corporate Personhood in Our Communities?

City officials must think critically and decisively about stemming the city’s negative population and economic growth. I offer my recommendation toward the end of this article.

Demographics

According to American FactFinder – Community Facts, the City of Trotwood, which has 24,431 residents, has seen its population drop 10.75 percent (or 2,942 residents) since 2000. Moreover, since 2000, whites have abandoned the city to the tune of 35 percent while its black population has increased 4.3 percent. Currently, blacks comprise 68.2 percent of the population while whites comprise 28.1 percent. The median household income is $37,859 compared to $48,246 for Ohio. Also, compare Trotwood’s median household income to the median household incomes of nearby cities with populations similar in size: Centerville, $57,385 (population – 23,999) and Miamisburg, $52,689 (population – 20,165). Unlike Trotwood, Centerville and Miamisburg have seen population increases of 3.37 percent and 2.70 percent, respectively. Additionally, Beavercreek has a median household income of $74,533 and a population of 45,780 (an increase of 18.99 percent since 2000). The Mall at the Fairfield Commons  is located there.

Industry Segmentation

According to the 2007 Economic Census, the retail industry dominates Trotwood business with $264 million in sales followed by health care and social assistance with $70 million and accommodation and food services with $14 million. These top three industries, respectively, totaled $348 million in sales. By contrast, the retail sales of Centerville was $595 million (2.3 times that of Trotwood), while Beavercreek was $887 million (3.4 times that of Trotwood) and Miamisburg was as $361million (almost 1.4 times that of Trotwood). Centerville and Miamisburg surround the Dayton Mall which is located in Miami Township while the Mall at the Fairfield Commons is located in Beavercreek. Trotwood residents will most likely have to travel to either of these two malls for most of their shopping needs. Retailers in those locations will ultimately benefit by increased sales.

Dilemmas

Changing Demographics

Trotwood has seen negative population growth of 10.75 percent from 2000 until 2010 while nearby retail markets in Beavercreek, Centerville, and Miamisburg have seen positive population growth of 18.99 percent, 3.37 percent, and 2.70 percent, respectively. Additionally, median household incomes in those markets are greater than Trotwood’s by a factor of 1.97, 1.52, and 1.39, respectively. City officials must come to terms with these changing demographics and plan accordingly.

Tax Support Challenges

According to their web sites, Trotwood has a 2.25 percent income tax rate compared to Beavercreek, none; Centerville, 1.75 percent, and Miamisburg, 1.75 percent. It also has a relatively high effective residential property tax rate of 99.08 mills compared to Beavercreek, 75.48 mills; Centerville, 84.09 mills; and Miamisburg, 79.93 mills. Its rate for commercial property tax is also the highest: Trotwood, 106.55 mills; Beavercreek, 76.33 mills; Centerville, 85.26 mills; and Miamisburg, 81.41 mills. New residents and businesses may be deterred by relatively high tax rates.

Retailers May Not Understand Black Consumers

Race may also be a dilemma as major brands may not cater to a mostly African American market or may not know how to do it. Trotwood is over 68 percent black and brand name black-owned retailers are virtually nonexistent. Therefore, blacks are left dependent on smaller mostly Asian or Middle Eastern retailers with lesser quality goods and services. For some insight into black spending power and consumption read the Nielson and NNPA report: African-American Consumers: Still Vital, Still Growing.

In its planning to revive the city, Trotwood officials must consider the specter of race as it relates to drawing in retailers of any kind.

Lastly, blacks must also do more to provide quality branded establishments with superior goods and services inside of Trotwood. In this day and age, there are no excuses given the experience we have in observing the ambiance, service, quality, and marketing of many major brand retailers. The Taste Restaurant on Salem Avenue is an example. Could Salem Avenue in Trotwood become the next Black Wall Street?

What is Trotwood to do? 

Recommendation

Best Solution- Merger/Annexation by City of Dayton

Trotwood officials should consider being annexed by or merged with the City of Dayton to achieve efficiencies in services and cost savings for its residents. Trotwood residents would achieve several benefits such as lower property taxes and lower utilities (e.g., lower water, sewer, and trash collection fees). Moreover, they would have more efficient services due to Dayton’s greater economies of scale in police, fire, and EMS protection.

According to my calculations, property tax savings for a Trotwood homeowner with a home valued at $100,000 would amount to $574 per year. There would be no savings on income taxes because both cities charge the same rate of 2.25 percent, which is second only to Oakwood’s 2.5 percent. Additionally, they would save about 38 percent on annual water and sewer fees (according to Oakwood’s 2013 Annual Water and Sewer Survey) and about 27 percent on waste collection (my calculation based on fees gathered from phone calls to both agencies).

According to city budget reports, in 2013, Dayton spent about $83.6 million for police and fire protection while Trotwood spent about $8.29 million or 9.9 percent of Dayton’s budget for police and fire protection. The expenditures associated with this amount should be easily absorbed into Dayton’s budget resulting in further savings.

This annexation or merger would most likely require an ordinance from Trotwood’s city council or a petition from its residents in accordance with Chapter 709 of the Ohio Revised Code.

Lastly, the annexation/merger of Trotwood into Dayton would not be complete unless the two school systems also merged. The merger of the school systems would require a separate petition from Trotwood’s school board. Again, Chapter 709 of the Ohio Revised Code provides guidance.

Conclusion

By any measure, Trotwood is in continual decline in terms of population and economic growth. Despite what I see as good strategic planning by its officials, they lack one important insight-white people with money are leaving instead of coming. That’s an economic disaster because they draw more businesses.

In addition, the cost of living in Trotwood is relatively high compared to other areas in Montgomery and surrounding counties. City officials are in a catch 22, e.g., they must offset dwindling revenues by raising taxes, which is not a good way to attract white people with money.

With a merger with Dayton, residents of Trotwood now have more disposable income in which to add to the Dayton economy, hopefully.

It doesn’t end there. Dayton officials must now capitalize on the acquisition by minimizing acquisition costs if any and using the additional revenue to develop the now larger, more populous metropolitan area. This necessarily means reducing payroll and property tax rates so that the city is more attractive to new comers.

Other Progressive Ideas

         Technology, Jobs, and Education

1.       The new Dayton should establish community broadband to break the stranglehold of Time Warner and make it available to every city household. It should make every multi-tenant building in downtown Dayton fiber optic ready (at no cost to the landlord), so that business tenants can enjoy the best broadband available.

2.       It should create a $200,000,000 low-interest revolving loan fund for Dayton homeowners to improve the external structures of their homes. Homeowners may draw up to $15,000 to pay for improvements such as roofs, gutters, windows, doors, etc. Homeowners with incomes below a certain amount should get grants of up to $15,000. This should spur more spending in home furnishings which will create more jobs. As mentioned earlier, Lowes and Home Depot still remain here locally. Moreover, construction jobs would skyrocket.

3.       All school-age children in new Dayton should have a lab-top computer provided to them, if they cannot afford it. Each computer should have web-based educational software and homework support. The best educational services will provide instant student feedback, which is the key to student learning. Additionally, computers provide remediation opportunities which teachers rarely get a chance to do inside the classroom.  The city and the school system should collaborate to make this happen. If the educational software is too expensive to purchase via a subscription service, then they should build their own.

One last thought

If this is to work, both city officials and residents must be selfish. Most likely, they will have the tendency to include surrounding suburbs in their plans under the guise of regional planning and cooperation. This would be a mistake because the key is to become more competitive than them. We have the numbers and the political advantage to make it happen while they do not. Don’t believe me; read this article, The Story of How Columbus Grew to be the Largest City in Ohio.

If we don’t make this happen, both Dayton and Trotwood will end up like East Cleveland.

About the Author

Marlon Aldridge, Sr. is the founding president and CEO of the Black Man’s Think Tank, which is a nonpartisan, nonsectarian, nonprofit, tax exempt organization located in Dayton, Ohio. Its mission is to develop and support industry between black organizations and professionals. He holds a bachelor’s degree in physics from Morehouse College and a master’s degree in physics teaching from Wright State University. Additionally, he served as a seaman in the United States Navy and as a commissioned officer in the United States Marine Corps. He teaches college physics, runs several businesses, and helps develop his community through his work with the BMTT. His motto is “knowledge is power, but organization is intelligence.” He subscribes to the belief of Carter G. Woodson that “one’s education is best measured by one’s devotion and ability to uplift and advance his community”.

New Dayton
Annexation of Trotwood
Annexation of Trotwood into Dayton
City of Trotwood
Demographics of Trotwood
Income Taxes
Merger of Trotwood and Dayton
Property Taxes
Target in Trotwood
Trotwood Utility Rates
White People with Money
Trotwood Ohio

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