The Fiscal Impacts of Alternative Land Uses

Abstract

Current knowledge of the fiscal impacts of alternative land uses comes largely from cost of community services (CCS) case studies, the results of which are viewed skeptically in the literature due to methodological concerns. To address these issues, we develop an econometric approach that allows us to capture both the direct and indirect relationships between a complete accounting of community fiscal measures and the full distribution of acres of land uses in a jurisdiction. Using a novel panel data set, we extensively document empirical correlations that have not yet been formally established in the literature. Our results are inconsistent with the broad conclusions of CCS studies: neither a shift from agricultural to residential land nor a shift to commercial land is associated with a significant change in the budget. We provide support for and insights into our results by extending our analysis to finer revenue/expenditure and land-use subcategories.