State of Minnesota

Cost of Public Services Study
  

For the Minnesota Department of Agriculture, Duncan Associates prepared educational and analytical tools for local decision-makers to assess the fiscal impact of development alternatives on public infrastructure in rural communities. The project consisted of two phases. First was a "cost of sprawl" study that compared the fiscal impacts of alternative development patterns in five selected rural county case studies. The second entailed development of a fiscal impact model for use by local governments. As a basis for the "cost of sprawl" study, a cross-sectional analysis of over 200 of Minnesota's cities, counties and townships was conducted.

The results of this statewide analysis revealed important insights into the fiscal impact of development on local governments in Minnesota. The results were also used to calibrate the fiscal impact model, which was then used to evaluate fiscal impacts of alternative growth forecasts in the case study counties. The statewide analysis revealed that the fiscal impact of development is strongly influenced by the strength of the local agricultural sector and location of new development. The fiscal position of most local governments is enhanced when new residential development occurs in cities, which are generally able to provide urban services typically demanded by new residents. When significant new residential development occurs outside of cities, it generally has a greater negative fiscal impact on the county and township budgets. The fiscal impact model is a jurisdiction-level model that can be used by counties, cities, townships, water and wastewater utilities and school districts. It can be used to determine costs of providing public services or effects of various exaction policies, or demographic, occupancy, value and tenure characteristics of new development.

Period:    April 1998 - October 1999                    Contact:    Bob Patton
Team:      Duncan Associates                                                Project Manager
               Public and Environmental Finance Assoc.                  651.296.5226 
               Richardson Richter & Associates                             
               Diddams Consulting