Thursday, August 11, 2011

Density pays off better than sprawl

A Colorado study for the Tucson-based Sonoran Institute by Asheville's Joe  Minicozzi concludes that across the board, downtown commercial and mixed-use buildings outperform their big-box counterparts when comparing tax revenues per-acre. The study looked at properties in and around Glenwood Springs, Colo. (Hat tip to Planetizen.com for the link.) Minicozzi looked at both property tax and sales tax revenues.

I wrote a year ago about Minicozzi's analyses of property in Sarasota County, Fla., and Asheville. It's another way that public officials should think about "growth" as they decide which projects to approve and which ones not to. In that previous posting, Minicozzi added a reply to some of the commenters, saying:
"When we ran the model in Asheville, our numbers show that our downtown continually out performs suburban low-density time and time again. A conservative estimate on multi-family services of government (sewers, water, schools, etc.) shows the costs roughly to pencil out to $16k/unit in compact development vs. $28k for low density. The simple way of thinking about it is that mile of pipe picks up more people in compact development, than it does in the low density stuff."
I recall that about 10 years ago, the town of Pineville outside Charlotte, a place known regionally for extreme sprawl retail, opted to reject a Wal-Mart Supercenter after running the numbers and concluding it would cost the town more in police and other services than the town would recoup in property and sales taxes.

In checking out the Sonoran Institute website, I noted this article from the Bozeman, Mont., Daily Chronicle in which a Sonoran Institute official points out that impact fees were a vital tool for the city. "There simply is no substitute," he said. The article is about a spat among city officials and developers over the city's hefty impact fees, which the city charges to cover the cost of roads, water, sewer and fire protection. "For the average single family home, impact fees cost $11,516," it says. " In Missoula, it costs $3,638 in impact fees for the average home."

In most of North Carolina developers pay no impact fees. The N.C. legislature must approve any city or county's impact fees on a case-by-case basis and hasn't OK'd any in several decades. That's just food for thought for anyone paying property taxes.

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