If they are going to make intelligent growth decisions, it is imperative that community leaders understand the relationship between residential, agricultural and commercial/industrial land use and what they cost the taxpayer.
According to Cost of Community Services (COCS) studies across the country by the American Farmland Trust, residential land development costs local governments nearly 5 times that of commercial/industrial, while agricultural land costs almost double that of commercial/industrial.
For example, an acre of land with a new house generates more total revenue than an acre of hay or corn. But it requires services that are not necessary for corn or hay. And an acre of commercial/industrial development generates far greater revenue for the local government while using a very small portion of local services.
According to COCS studies, across the United States over the past 35 years, commercial/industrial sector development plays a large part in generating revenues for local governments. And in return they receive only a small portion of the services the county/city provide. Simply put, commercial/industrial land generates far more public revenues than it receives.
These same studies confirm that residential development does not pay for itself. It is, in fact, subsidized by commercial/industrial development which is used to generate revenues that provide services and balance local budgets.
So if our local governments are trying to broaden their tax revenue to support public services that create a healthy community, the solution is not to raise taxes. Our tax rates are already some of the highest in the region.
Instead, industrial/commercial development has proven to solve the tax revenue problem time and again. We recommend the City/County have a COCS done to determine exactly the value of each land type, prior to determining future land use in the Comprehensive Plan.
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