The Fiscal Implications of Development Patterns

Every town, city, and county makes decisions about how to grow and what kind of development to build. These decisions shape entire neighborhoods and form the foundation of communities as we know them. These decisions can also have enormous implications for a municipality’s finances.

Over the past 40 years research has shown that low-density, unconnected, development is more costly to the public sector than compact, urban development. Every municipality considering new development should understand the financial implications of these options. How much will it cost to support that new development in coming years? Would the development bring more net revenue if designed differently? These are potentially multi-million dollar questions that no municipality can afford to ignore.

Smart Growth America, a national non-profit, and RCLCO, a national real estate advisory firm, have created a new model designed to help municipalities understand the financial performance of development patterns, and what strategies could generate better returns in the future. We look at a variety of public costs and revenues to help municipal leaders understand how a smart growth approach to development could help improve their bottom line. Download the overview for more information about our methodology.

The Fiscal Implications: Roads in New Jersey

In this version of our Fiscal Implications research, Smart Growth America teamed up with New Jersey Future to find out how much state, county and municipal governments in New Jersey could save on road maintenance bills by building in more compact ways. The Fiscal Implications of Development Patterns: Roads in New Jersey analyzes population and employment density to understand just how much money could be saved if the distribution of New Jersey’s population and jobs could be made even incrementally more dense and compact.

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The Fiscal Implications: Indianapolis, IN

Smart Growth America examined four different scenarios for the City of Indianapolis—two urban and two sub-urban. We found that both of the sub-urban scenarios would generate negative fiscal impacts for the City and school district.

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The Fiscal Implications: Macon, GA

Macon-Bibb County, GA asked Smart Growth America to analyze the net fiscal impact of future growth focused on downtown infill versus continued greenfield development in suburban locations. To conduct this analysis, we developed four hypothetical development scenarios: two in downtown and two in the suburbs. We found that the Downtown Infill scenarios would generate a net fiscal impact per acre that is 4.6 to 6.9 times than the same development program located on a suburban greenfield.

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The Fiscal Implications: West Des Moines, IA

The City of West Des Moines, IA hired Smart Growth America to analyze potential development options in the city over the next 20 years. We examined four different strategies for West Des Moines’ growth over the next 20 years. Each scenario assumes the development of 9,275 housing units and 2.69 million square feet of commercial space, which is in keeping with West Des Moines’ current growth.

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The Fiscal Implications: Madison, WI

The City of Madison hired Smart Growth America to analyze potential development options in the city’s Pioneer District, a 1,400 acre area that is largely vacant right now.

We evaluated five different scenarios for development: a “base” scenario that reflects the City’s current plan; a “Plus 50” scenario that assumes 50 percent higher density on certain parcels within the District; a “Compact” scenario which assumes the same development program as the base but on 500 fewer acres; a “Compact Plus 50” scenario which assumes the Plus 50 scenario on 500 fewer acres; and a “Low Density” scenario which assumes the same development as the base but on 1,000 more acres. The final scenario is for comparison purposes only, and is not actually possible.

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