Land-use Profit/Loss Study is Valuable Planning Tool
On Feb. 28, the Sarasota County Economic Development Board received a completely different kind of consultant’s report. Unlike the typical report that estimates the cost to build a library or repair a road, this report attempts to quantify the bottom-line profit or loss for the daily services government provides to our homes, our children and our businesses.
The concept is simple business mathematics: First you determine the price of production, subtract gross receipts, and the result equals your net profit or loss, Only in this case we are not talking about hypothetical widgets or doorstops, we’re talking about homes, businesses and schools and libraries.
The county contracted the economic consulting firm, Tischler and Associates, to estimate the fiscal and economic impacts of selected prototypical land uses in Sarasota County. In other words, compare how much it costs the county to produce the infrastructure (roads, schools, water, sewer, etc.), against how much man receives in taxes (real estate, gas, tourist, etc.) and fees (storm-water, recycling, utility, etc.). The results are not what you might expect.
Most residential housing developments turned out to be a financia1 burden on the county. According to the Tischler report, a typical Sarasota subdivision, where lot sizes average 75 by 125 feet, and prices range from $150,000 to $230,000, costs the county $1.53 for every $1 of revenue it generates. OUCH! No higher math skills needed here. Surprisingly, even apartment complexes with 5.5 units per acre cost the county $2.65 for every dollar of revenue they generated. The only residential land uses that cost the county less money for services than the revenue they generated were more expensive 5-acre ranchettes (57 cents spent for every dollar generated) and mobile home parks (75 cents spent for every dollar generated). Agriculture, commercial buildings and industrial sites also fared well in the fiscal and economic impact study, all costing significantly less money to service than the revenue they generate.
So how can these findings help us plan for a better community? First, the age-old assumption that agricul¬tural and park lands take property off the tax rolls and would be more productive as subdivisions, is, at least in my opinion, officially hog- wash. Using data from specific land use; in Sarasota, the Tischler report confirms that simply because a property produces more taxes, it does not assure that it will not be a liability to taxpayers. This may in part explain the multi hundred-million dollar revenue shortages needed for roads, schools and water.
A second point to consider when using this report for community planning is that it is only one of many planning tools required to make a community a quality place to live, work and play. We don’t want housing options to be limited to mobile home parks and expensive ranchettes out in the boondocks.
A significant force that affected the calculations found in this report is schools. Unlike typical residential suburban developments, commercial buildings, agriculture, industrial parks, rural residential and mobile home parks do not produce large numbers of school-age children. So, do we begin to award special benefits to those land uses that produce a positive revenue flow and penalize the less “profitable” ones? I personally do not want to live in a community that targets childless development. Education, just like ignorance, is a community expense – only education is cheaper. We all share in the costs and benefits. Likewise, it is disturbing to imagine a community where affordable housing options are discouraged and forced into neighboring counties.
While the Tischler report raised as many questions as it answered, it was money well spent by the commissioners. The report has given us invaluable information to consider in our community planning process. However, it is somewhat unsettling now to realize how many decisions were made in the past without the benefit of this knowledge.