A new planning tool that calculates the cost of growth is a game-changer for development in Boise and across the Treasure Valley.
The tool, with the unimaginative name “Tax Impact Tool” or “FIT,” was unveiled Tuesday during a webinar by the Community Planning Association of Southwest Idaho, or Compass.
“This is a pretty unique tool,” said Colin McAweeney, senior tax and economic analyst for TischlerBise, a planning company hired to create the tool, during Tuesday’s webinar. “We do tax impact analyzes across the country, and we usually do it for a single community, say, a city or a county. There have been a few examples where a tool like this has been put in place for an area, but really, right now, it’s kind of revolutionary, especially in Idaho.
I’ve watched development in Treasure Valley for 15 years, and cities usually have a binary decision: whether or not to approve a development that precedes them.
For the most part, this decision was something of a blow in the dark.
It usually looks like this: A farmer sells 80 acres of land to a developer. The developer offers a single-family residential development of three homes per acre. The developer is coming before planning and zoning and city council with a proposal to build 240 homes on those 80 acres. There could be a pocket playpen and a small open space. Usually there is a report from the Ada County Road District that talks about the current levels of service provided by the roads and the number of vehicle trips that this subdivision will produce when fully constructed. There will be a discussion on sewer connections, irrigation water, sidewalks, curbs, gutters. Development is approved.
A few years later, the police department needs more cops, the fire department wants to build a new fire station on the west side of town to service these new subdivisions, and they need a new truck. firefighters and an ambulance, and they also need more people to staff the new fire station.
A nearby intersection with a two-way stop is becoming the site of an increasing number of serious accidents, but ACHD doesn’t have the money to improve that intersection.
Valley Regional Transit wants to build an incentive parking lot to encourage drivers to take the bus to Boise to ease traffic on Interstate 84, so they are asking cities and the county to help them pay. The cities do not want to pay because, in their logic, “nobody takes the bus”.
The school district is asking voters to approve a $ 15 million bond, paid by property taxes, to build a new elementary school due to all the new subdivisions filled with children whose families have moved there.
Seemingly endless growth cycle
This is the seemingly endless growth cycle and associated costs in Treasure Valley.
The problem is, the town planning commissioners and council members didn’t really take into account all of the future costs associated with approving this 240-house subdivision.
Everything is about to change with the new tax impact tool launched by Compass.
As demonstrated on Tuesday, the tool will allow planners to plug in different types of proposed development – such as a 240-home single-family residential development, a 20,000-square-foot grocery store, or a 100,000-square-foot big-box store. – and tell planners when the city, county, school district or highway district is “breaking even”. In other words, when would the revenues from this project exceed all expenses associated with providing services to the project?
Or, the tool can tell them if it would break even.
“Never before has Ada County or any of our six cities conducted what is called a tax analysis to understand the true costs of growth,” the former County Commissioner told me. Ada, Diana Lachiondo, in an interview earlier this year. “And it’s done now through Compass so that all six cities, county and CDHA can understand how some of the proposed new developments will cost a lot more to maintain – or not. And I think that’s critically important as we move forward if we’re going to understand how we can grow in a way that doesn’t continue to weigh on existing owners.
Lachiondo was one of the main supporters of the realization of this tool. His reward? The developers paid a lot of money to run negative ads against her and get her fired. She lost the election in November to Republican Ryan Davidson.
“It’s not that I don’t like development or that I’m saying growth isn’t going to happen,” Lachiondo said. “We’re just being honest about the costs. And I’ll tell you in regards to my election, that’s why I got hammered. … But we’re just showing the data, we’re showing the dollars and cents of what it’s going to cost. Now if these communities say, “Well, we still think this is really important and that’s why,” okay. But we have to look at the costs with our eyes wide open. And that’s kind of my hill that I was ready to die on. Obviously. “
A tool like this is long overdue for Treasure Valley and should help planners make smart, data-driven decisions when proposals are presented to them.
Big-box store offered
In 2006, a developer proposed a big box store in what was then a farm field on the southwest corner of Deer Flat and Meridian Roads in Kuna. Many residents have claimed that a Walmart will destroy downtown. The promoters argued that Kuna would benefit from the sales taxes. But when I did some research, I learned that cities don’t charge point-of-sale sales tax. Instead, the state collects all sales taxes and then distributes that income based on a complicated formula that includes the population.
I also looked at what the increase in property taxes would entail converting agricultural land into a big box store and found that Kuna Town property taxes would increase by about $ 10,000 or 20. $ 000, and I asked if that would even be enough to support the increase in policing.
My rudimentary analysis at the time is only a fragment of the type of tax analysis this tool will calculate. It will take into account not only police services, but also fire protection, bus services, road and ambulance coverage as well as impacts on libraries and school districts.
In the example of the Kuna supermarket, city council members ended up approving the proposal, and this corner now houses a Ridley’s, a Bi-Mart, a McDonald’s, a car wash, a KJ’s convenience store, a branch of the Idaho Central Credit Union and more. . Other commercial developments have sprung up around it.
So what happens when a proposal comes back with a report that says “Not Breaking Even”? What then does a member of city council or a county commissioner do?
“Tax results are one of the many decision tools for policymakers,” McAweeney said. “There will be (projects) that are not in pencil, if that helps achieve another goal or another community initiative. Maybe it’s a development that has been approved that is not emerging, but it is a decision that has been made to meet other needs. “
For example, a community may want to attract more restaurants, which might not generate property tax revenue to support roads and police services, but the community is willing to accept this negative tax impact in order to have more restaurants. .
In Kuna’s example, having a big box store just as a convenience to residents was a possibly greater determining factor than the fiscal impact on police departments – a financial benefit the city was prepared for. to do.
“On the other hand, if (a project) doesn’t take shape, the developer and the community could come together to fix this problem,” McAweeney said. “Is there a trigger for important infrastructure that is really not compensated by development? And maybe there are negotiations that can come into play to help offset and mitigate those costs. “
So, for example, a subdivision developer could donate land for a new school or a new fire station in order to slightly reduce the net negative impact of this project.
Whatever the scenario, this tool brings Treasure Valley into the modern era and should help policymakers finally answer this question: is growth profitable?
And it will give cities and counties, those who make land use decisions, leverage when negotiating with developers.
Scott McIntosh is the Idaho Statesman opinion writer. You can email him at firstname.lastname@example.org or call him at 208-377-6202. Follow him on Twitter @ ScottMcIntosh12.