A town experienced widespread increases in property values in 2008. The town council voted to freeze assessed values at their 2007 levels.

In present day (2019), town residents are voting on a ballot measure to rest assessed value to market levels and set the mil rate to hold revenues constant. On average, property values are now ~15% greater than 2007 levels and the community is very heterogeneous with respect to property values.

Two groups are campaigning vigorously about the ballot measure. One group represents homeowners in low-income neighborhoods. The other group represents the wealthier neighborhoods.

a) If the groups are pursuing the economic self-interest of their members, describe whether each group would support or oppose the measure. Why?

b) If the ballot measure passes what will happen to property values in the town?