County should eye growth's fiscal impact

Kai Hagen

May 13, 2004

When people talk with me about my column, they often assume the hardest part is deciding what to write about every two weeks and coming up with enough to say. In truth, however, the most difficult aspect is figuring out how to address a complex issue in just a few hundred words, make a point or two worth making, and keep it interesting at the same time.

If a potential subject, such as "fiscal impact analysis" is both dry and complicated, well, the task is daunting. But sometimes a dry and complicated issue is too important to avoid. After all, our community and our lives are greatly affected by all sorts of bureaucratic processes and government policies that are endlessly convoluted or exceedingly boring to folks who aren't policy wonks.

Before your eyes glaze over, though, and you decide to move on to something else, consider the prospect of paying higher taxes for lower quality and overextended public services and facilities, while experiencing a variety of other negative effects on the quality of your life in Frederick County.

Because, when it comes to planning and constructing the future of Frederick County, we are working without a few of the most effective tools available. And one of the most useful tools we don't have in our Winchester Hall toolbox is fiscal impact analysis.

So what is it? Reduced to the basics, fiscal impact analysis, sometimes referred to as "cost-revenue analysis," is a means to measure the real and ongoing financial impact of new growth and development on both sides of a governmental budget.

Throughout the recent decades of rapid growth in the county, concerned residents have been told, or reassured, that development increases the county's tax base and, presumably, provides a financial boost for the county, with benefits for all residents. The argument is used time and time again to support everything from specific rezoning applications to changes in the county's comprehensive plan.

Recent history here and elsewhere suggests skepticism is in order.

There are good reasons why most counties experiencing rapid growth are also confronting strained budgets, hard choices, gradually diminishing public services and pressure to increase revenues with new fees and taxes. Put simply, it's because so many counties continue to support and approve development that requires services and facilities that cost more than the new revenues they generate.

Frederick County is no exception.

But it could be.

Fiscal impact analysis may not be a simple to implement. The results can be only as good as the standards used in applying it. And a flawed analysis can lead to mistaken claims about the likely impacts of a project. Nevertheless, it's the best available tool we could have for evaluating the impact of development on the county's budget, and it's hard to see the downside of having more and better information as part of the decision-making process that shapes our future.

It isn't a radical notion. Other fast-growing counties around the country have figured out that it's an indispensable tool. Some of our neighbors, including Howard, Carroll and Loudoun counties, have already put various models to good use.

Considering the effect on our lives, Frederick County residents, taxpayers and voters ought to insist the Board of County Commissioners use a meaningful and comprehensive form of fiscal impact analysis.

We need this proactive planning tool, so that our communities can compare the broader and long-term financial impacts of real alternatives.

We have options.

It isn't about being pro-growth or anti-growth. It's about choosing wisely to support growth that genuinely supports the county, rather than the other way around.

County Commission Mike Cady recently wrote on "For a county to enjoy a healthy economy, it must wed a number of initiatives into a balanced growth plan at a pace the community can financially support and is politically acceptable."

It's hard to disagree with that general statement. The problem is that we don't really have an accurate accounting for what we can financially support. And, since we are the folks who will pay for poor initiatives and unbalanced growth, in more ways than one, it ought to be politically unacceptable not to implement comprehensive fiscal impact analysis.

To get in touch, e-mail Kai Hagen at