The Effects of Land Development on Municipal Finance

Abstract

This review presents a conceptual model to understand and trace the effects of land development on municipal expenditures and revenues. It includes discussion of the how local voters determine levels of expenditures and levels of service subject to external constraints. It also discusses the production function of local public services. This review and model can serve as a basis for evaluating fiscal projections for land development proposals. It finds that direct fiscal impacts measured in most fiscal impact analysis techniques are only a subset of the types of impacts that would likely be expected to result from land development within a community.