Should cities sell their naming rights to private corporations? This is the new question that is rising debates and concerns in the sunny Miami Beach, where the City Council considered the issue during its Wednesday meeting.
The goal of such a measure would be to boost up city coffers without raising taxes and endangering the local economy, already destabilized by strong zoning rules and high taxes. And the need for this was never felt more than Wednesday, when the Council also passed the local version of the State Homestead Senior Tax Exemption. The exemption takes away property tax obligations from seniors earning less than $27,000 a year and having lived at the Beach for at least 25 years. According to the city staff, it will cost Miami Beach $17,000 in lost revenue.
Many local inhabitants oppose the idea of selling the name of their famous city. But not as many support tax increases to make up for the difference in revenue.
A previous plan to sell off the name of South Pointe Park to Carnival Corporation failed because of the company's eventual withdrawal from the contract. South Pointe is the southernmost area of the sandbar and directly faces the waterway taken by many cruise ships, including Carnival vessels, everyday.
The City Council is now envisaging selling its naming rights to a sunblock company. And it is obvious that such a new market could tremendously increase local revenues, the demand for the new market being so high. After all, how many small and large businesses just dream about naming their companies after Miami Beach?
Yet, as good as the idea of raising revenue without taxation seems, this idea hides something inherently wrong.
Selling something in the market implies previous ownership of the good being sold. A car owner is able to sell his or her vehicle because he or she is the legal owner. But can we really say that geographically important names actually belong to someone? And if so, can the owner of the name really be the city government?
The answer is clearly no. Names such as Miami Beach, Paris, Rome, Seattle define certain places and areas that happen to be within a local government's jurisdiction. But the name is never used to describe the local government itself, but rather the geographical area. When one talks about Paris, he is hardly talking about Mayor Delanoe, just as Miami Beach usually refers to the beautiful sandbar with hundreds of small businesses, not the City Council.
In other words, the name of a city is independent from the local government. Even though the latter usually has the power to change the place's name, this power is usurped as most of the time, it is not the City Council that invented the name to begin with.
In another approach, it should be noted that even if the name of Miami Beach were to belong to a special entity, the local government should be the last one to think of. The Miami Beach government never produced anything efficient, never ruled by contract of voluntary agreement. The few services it provides are all poorly-managed and subsidized by taxpayer money. The value of having an enterprise named after the city does not come from the local government's achievements, but from the thousands of businesses, private entities, and individuals that have made up the local culture over the past few decades.
Since it is not realistic to give the naming rights of Miami Beach to these different groups, the name should be free to use with no group having a monopoly over the name of the location.
While it is better than having a legal monopoly over the name and banning its use for commercial purposes, selling naming rights is still not enough if we want to see a legitimate local government using only its lawful powers.
The City Council may want to look at other alternatives to raise revenue without raising taxes. Privatization of services is a good step to begin with.