Achieving prosperity in the 21st century challenges local governments to consider new land use and transportation strategies to balance environmental, social and economic interests. Many communities are learning that how and where they develop has enormous impacts on their bottom line and are starting to explore how to better evaluate and understand the fiscal impacts of varying growth and development patterns. This is especially important as local governments seek to balance their books in a world of reduced revenues, growing costs, and decades of deferred maintenance for valued and critical infrastructure.
In response to this growing need for understanding the fiscal implications of growth, the Local Government Commission has developed several resources highlighting examples of different approaches and tools local governments are using to better understand the economic implications of development in their community.
Fiscal Impact Tools
Fiscal impact tools are emerging across the nation and changing the dialog around local and regional planning. Jurisdictions now have a number of tools they can use to compare costs with revenue and analyze fiscal impacts, evolving to meet the increased demand of resource constrained municipalities. This article will take readers on a tour from California to Florida, introducing six emerging fiscal impact tools and providing a cursory review of how these tools are changing local and regional planning discussions.
Economic Impacts of Development Patterns in the San Joaquin Region
The Local Government Commission developed this fact sheet to provide local governments in California’s San Joaquin Region a better understanding of the range of economic impacts of development. Specifically, recent research in the San Joaquin Region and around the country has found that compact, mixed-use patterns of development can improve the bottom line for cities and counties by increasing revenue, reducing costs and reducing health, resource and environmental impacts.
- Economic Impacts of Development – Fact Sheet PDF
Meeting Future Housing Needs in the San Joaquin Valley
The San Joaquin Valley will experience the highest growth rate in California over the next 40 years. Meeting the housing needs of current and future residents will mean introducing new development types (i.e., mix-use and infill) in a region that has predominantly built only single family homes. Local governments have a big role to play in laying the planning and policy groundwork that will help facilitate a new era of development in the Valley.
- San Joaquin Valley Housing – Fact Sheet PDF
Valuing Downtowns: Upward Not Outward is a Smart Revenue Strategy for Local Governments
The Local Government Commission partnered with Urban3 and the Council of Infill Builders to evaluate the property tax revenues generated by existing developments in six San Joaquin Valley cities – Modesto, Turlock, Merced, Fresno, Clovis and Visalia. What was discovered is that compact, mixed-use developments pay better dividends to local governments than low density, suburban development when compared on a basis of tax revenue generated per acre. Results of Urban3’s analysis are captured in the Valuing Downtowns Fact Sheet (PDF) and were also highlighted at past events in each of the six cities.
- Valuing Downtowns – Fact Sheet PDF
- Invest in Downtown – Turlock Journal: PDF | HTML
- Build Up Downtown to Boost Tax Revenue – Modesto Bee PDF
What’s Infrastructure Got To Do With It?: Helping Cities Generate Revenue Through Strategic Development
The City of Galt partnered with the Sacramento Area Council of Governments (SACOG) and the Local Government Commission to learn more about the effects that land use decisions have on a community’s fiscal health, by using SACOG’s Integrated Model for Planning and Cost Scenarios (iMPACS) tool. In each of the scenarios, mixed-use development consistently generated a higher ratio of revenue to cost when compared to separated land uses.
- Galt Case Study PDF
- Galt White Paper PDF
Additional Resources
Smart Growth America collected almost 20 different fiscal comparisons for different development strategies from towns, cities and states from across the United States to determine their impact on municipal finances. This report found that compared to conventional suburban development; compact, mixed use development costs one-third less for upfront infrastructure, saves an average of 10% on ongoing delivery of services, and generates ten times more tax revenue per acre.