One of the ways that cities determine where they should spend money and invest is through something known as Participatory Budgeting. The birthplace of this approach is generally thought to be Porto Alegre in Brazil, which first adopted it in 1989. Since then, it has become a mainstream practice and spread to cities all around the world, including New York and Paris, both of which operate ambitious programs.
In the case of Paris, they have committed 5% of their capital budget to be spent in this way. The way it generally works is simple: citizens get to propose ideas and then vote on which urban projects they think should be funded. Last year, Paris saw 2,079 ideas proposed, 261 projects put to a vote, 162,395 votes, and 104 projects selected. And since the program launched in 2014, over €768 million has been allocated.
Some of these projects are very local and specific, such as "build a sports facility on this street," while others are city-wide, like "make things cleaner, be better at sorting waste and recycling, and reduce noise."
While there's lots of debate about the effectiveness of Participatory Budgeting, it does offer a number of benefits. Studies have shown that it can improve public trust in government institutions by making them more accountable. It can also help to educate residents on what things actually cost, making trade-offs more understandable. But most importantly, it can help to better allocate funds.
After all, who better to decide what a neighborhood needs than the locals who live there every day? Just don't ask about building new housing.
Cover photo by Ness P. Colmart on Unsplash
One of the themes we cover on this blog is the importance of place in a world where people are becoming increasingly untethered. While I'm a firm believer that great local places have enduring value, this does not mean that technology isn't driving greater fluidity in the way people live, work, play, and optimize their taxes.
Over the last decade, the population of ultra-wealthy Americans (those with a net worth greater than or equal to $30 million) has risen noticeably in two states: Texas and Florida. California, a high-tax state, still dominates; however, Texas has overtaken New York, and Florida has overtaken Illinois. Notably, both Texas and Florida have no state income tax — they also have warmer weather than New York and Illinois.
It has now been almost a year since New York City implemented its congestion charge for the area of Manhattan south of 60th Street and, despite all of the critics, the results are overwhelmingly positive. Here are some of the most important data points:
Pollution is down by as much as 22% in the congestion zone area.
Traffic has declined by about 11% in the zone. As a reminder, traffic improved basically immediately following the $9 charge.
An average of 71,500 fewer vehicles entered the zone each day from January through to November 2025, totalling nearly 24 million fewer vehicles.
The congestion charge is forecasted to bring in $548.3 million in 2025, beating the initial goal of $500 million. (This revenue will be used by the MTA for bond issuances that will in turn fund further infrastructure improvements.)
Importantly, foot traffic in the zone is also up year-over-year compared to Manhattan as a whole (3.5% versus 1.4%, respectively).
Storefront vacancies in the zone declined more rapidly compared to Manhattan as a whole and the rest of the city. (Though the vacancy rate is still the highest in this area, presumably because of the higher rents in downtown and midtown.)
New York City's sales tax revenue is also up 6.3% this year compared to the same period last year, outperforming all neighboring counties. This suggests that the congestion charge is not keeping shoppers away.
So, why
One of the ways that cities determine where they should spend money and invest is through something known as Participatory Budgeting. The birthplace of this approach is generally thought to be Porto Alegre in Brazil, which first adopted it in 1989. Since then, it has become a mainstream practice and spread to cities all around the world, including New York and Paris, both of which operate ambitious programs.
In the case of Paris, they have committed 5% of their capital budget to be spent in this way. The way it generally works is simple: citizens get to propose ideas and then vote on which urban projects they think should be funded. Last year, Paris saw 2,079 ideas proposed, 261 projects put to a vote, 162,395 votes, and 104 projects selected. And since the program launched in 2014, over €768 million has been allocated.
Some of these projects are very local and specific, such as "build a sports facility on this street," while others are city-wide, like "make things cleaner, be better at sorting waste and recycling, and reduce noise."
While there's lots of debate about the effectiveness of Participatory Budgeting, it does offer a number of benefits. Studies have shown that it can improve public trust in government institutions by making them more accountable. It can also help to educate residents on what things actually cost, making trade-offs more understandable. But most importantly, it can help to better allocate funds.
After all, who better to decide what a neighborhood needs than the locals who live there every day? Just don't ask about building new housing.
Cover photo by Ness P. Colmart on Unsplash
One of the themes we cover on this blog is the importance of place in a world where people are becoming increasingly untethered. While I'm a firm believer that great local places have enduring value, this does not mean that technology isn't driving greater fluidity in the way people live, work, play, and optimize their taxes.
Over the last decade, the population of ultra-wealthy Americans (those with a net worth greater than or equal to $30 million) has risen noticeably in two states: Texas and Florida. California, a high-tax state, still dominates; however, Texas has overtaken New York, and Florida has overtaken Illinois. Notably, both Texas and Florida have no state income tax — they also have warmer weather than New York and Illinois.
It has now been almost a year since New York City implemented its congestion charge for the area of Manhattan south of 60th Street and, despite all of the critics, the results are overwhelmingly positive. Here are some of the most important data points:
Pollution is down by as much as 22% in the congestion zone area.
Traffic has declined by about 11% in the zone. As a reminder, traffic improved basically immediately following the $9 charge.
An average of 71,500 fewer vehicles entered the zone each day from January through to November 2025, totalling nearly 24 million fewer vehicles.
The congestion charge is forecasted to bring in $548.3 million in 2025, beating the initial goal of $500 million. (This revenue will be used by the MTA for bond issuances that will in turn fund further infrastructure improvements.)
Importantly, foot traffic in the zone is also up year-over-year compared to Manhattan as a whole (3.5% versus 1.4%, respectively).
Storefront vacancies in the zone declined more rapidly compared to Manhattan as a whole and the rest of the city. (Though the vacancy rate is still the highest in this area, presumably because of the higher rents in downtown and midtown.)
New York City's sales tax revenue is also up 6.3% this year compared to the same period last year, outperforming all neighboring counties. This suggests that the congestion charge is not keeping shoppers away.
So, why
As we have talked about before, there's a longstanding migration trend in the US toward sun, urban sprawl, and lower taxes. But it's not always as clear-cut as a rich person fully relocating to a lower-tax jurisdiction and completely severing ties. The enduring value of place means that many people still travel back and forth to meet whatever personal or professional obligations they might have.
And today, there are apps, such as TaxBird, that will meticulously track the number of days you spend (or your phone spends) in each jurisdiction to ensure you don't cross any important residency thresholds.
The global standard is the 183-day rule (or roughly half a year). In many or most cases, if you are physically present in a place for more than 50% of the year, you are automatically considered a resident for tax purposes. But it's not always this simple, so check with your tax advisor. Regardless, the untethering of life and work is surely allowing more people to tax-optimize in this way.
None of this is surprising.
As Charlie Munger used to say, "Show me the incentive, and I'll show you the outcome." But now we need to think about the longer-term ramifications for colder, higher-tax jurisdictions as capital and tax revenue continue to be siphoned off, not only to Texas and Florida, but to Dubai, Singapore, Hong Kong, Switzerland, Monaco and other places.
Cover photo by Colin Lloyd on Unsplash
Cover photo by ian dooley on Unsplash
As we have talked about before, there's a longstanding migration trend in the US toward sun, urban sprawl, and lower taxes. But it's not always as clear-cut as a rich person fully relocating to a lower-tax jurisdiction and completely severing ties. The enduring value of place means that many people still travel back and forth to meet whatever personal or professional obligations they might have.
And today, there are apps, such as TaxBird, that will meticulously track the number of days you spend (or your phone spends) in each jurisdiction to ensure you don't cross any important residency thresholds.
The global standard is the 183-day rule (or roughly half a year). In many or most cases, if you are physically present in a place for more than 50% of the year, you are automatically considered a resident for tax purposes. But it's not always this simple, so check with your tax advisor. Regardless, the untethering of life and work is surely allowing more people to tax-optimize in this way.
None of this is surprising.
As Charlie Munger used to say, "Show me the incentive, and I'll show you the outcome." But now we need to think about the longer-term ramifications for colder, higher-tax jurisdictions as capital and tax revenue continue to be siphoned off, not only to Texas and Florida, but to Dubai, Singapore, Hong Kong, Switzerland, Monaco and other places.
Cover photo by Colin Lloyd on Unsplash
Cover photo by ian dooley on Unsplash
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