The growing American retired population increasingly is viewed for its economic development potential. The relationship between the elderly and local taxes may have a critical effect on this potential, however. This paper examines the local tax implications of an increasing elderly population in communities prohibiting tax referenda. In such communities, citizens have no direct role in tax decisions. The elderly's attitudes towards different local taxes are examined using telephone survey data, before using aggregate data to investigate the relationship between the elderly and the specific taxes used in communities. The results suggest that a high proportion of elderly do not affect the mix of local taxes, but that an increasing proportion does have an influence.The growing American elderly and retired popula-subject to voter approval, however. The impact of tion increasingly is viewed for its economic devel-a growing elderly population in such areas may be opment potential. Advocates of retirement-based entirely different than when citizens vote directly economic development argue that retirees are an about tax issues. attractive base upon which to build or diversify an This paper examines the local tax implications economy. In-migrant elderly are particularly at-of the elderly population in Pennsylvania, a state tractive, as they are relatively young (between 55 which does not allow local referenda. It first conand 65), purchase housing, deposit money in local siders attitudes towards local taxes in case studies banks, and contribute to the local economy without of four rural Pennsylvania counties, with attention demanding many services in return. In addition, to the influence of in-migrant vs. aged-in-place they argue, whether the retirees are in-migrants or status on those attitudes. The paper then takes a aging-in-place, retirement incomes are relatively broader focus by examining whether a large and stable, contrary to incomes in much of the private growing elderly population affects annual tax levsector.ies, using secondary data for all municipalities in A growing elderly population may also affect Pennsylvania. The impacts considered include the ability of local governments to levy taxes. If a whether specific taxes are levied, and the relative growing elderly population hinders local govern-importance of those taxes. ments' abilities to raise taxes at the same time it increases the demand on public services, the net fiscal impact may be negative. Earlier studies have Impacts of the Elderly looked at the relationship between the elderly and local taxes, generally by examining the elderly's Many recent studies suggest that elderly insupport for local tax referenda or bonds. Most such migrants have positive economic impacts on their studies have suggested that the elderly are not sup-destination rural communities (Haas and Serow, portive of increasing taxes, with consequent impli-1988; Longino and Crown, 1990; Siegel and cations for local jurisdictions. These results may
