Fiscal Impact Assessment: Cases for Study


Use the following information to answer the questions below:

 
 PLYMOUTH (1996) BROOKLYN PARK (1996)
 Operating Number Operating Number
 Costs Employees Costs Employees
General Govt.
 Finance 2,563,500 8 592,900 11 
Control 3,165,600 12 1,015,800 25
Public Safety
 Police 7,495,693 50 2,086,600 50
 Fire 1,129,000 10 314,300 2
Public Works
 Highways 1,266,230 19 1,761,500 28
 Sewers 1,043,700 6 1,491,000 10
 Sanitation 0 0
 Water 668,470 6 834,000 10
Recreation
 Parks 1,351,000 9 1,051,000 19
 Libraries 0 0
Debt Service 6,112,500 538,200
Real Value 204,785,200 262,770,460
Population 31,165 43,332
Households 10,491 15,268
Growth rate 3.0% 3.5%
Revenue:
Taxes:
 Property .0218 .0228
Fees
 Interest 103,092 6,000
 Sewer 1,224,432 1,700,600
 Water 870,000 1,209,300
Transfers
 Road Aid 568,363 789,394
 Revenue Share 127,880 177,612


1. According to planning projections, the city of Plymouth, MN, should experience a growth between 6,000 and 18,000 units of housing by the year 2000. Using 10,000 as a best estimate, and assuming that most of the units will be detached, single-family dwellings worth $110,000 each, and assuming an average household size of 3.6 persons, what would you project to be the ultimate fiscal impact of this growth on the city?

2. Assume that a mix of housing units will be built to meet the growth in Plymouth. The projected increase is 36,000 people, divided into equal numbers of single-family dwellings (worth $110,000 and averaging 3.6 people per household), duplexes (worth $85,000 and averaging 2.25 people), and apartments (worth $75,000 and averaging 1.75 people). What are the fiscal impacts of this growth strategy on the city?

3. Suppose a major industry approached the city of Brooklyn Park, a growing city, for an industrial expansion project. The expansion will increase employment by 500, and will generate the following revenue stream:

    • Property taxes -- $22,800
    • Water & sewer -- $19,132
    • CDBG transfer -- $10,000

What are the fiscal impacts of this project as proposed?

4. A developer has approached the city of Brooklyn Park with three proposals for a large parcel of land. Under one proposal, the land would be developed with 400 single-family units (averaging 3.6 persons) valued at $110,000 apiece. The second would develop the same land with a garden apartment complex of 6,000 units (averaging 1.75 persons) valued at $70,000 apiece. The third would combine both ideas, with 2,000 units (averaging 2.25 persons) and an average value of $85,000 per unit. Using the service standards method, which proposal is most desirable for its fiscal impacts on the city?

5. Recalculate problem #4 using the comparable city method. Assume the project will take 5 years to complete. What do the results tell you about the impact of choice of method on the conclusion eventually reached?


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1996 A.J.Filipovitch
Revised 11 March 2005