Home Building Profitable for Local Governments
By Ed Taczanowsky – President of SAHBA
How
many times have we heard that “growth must pay its own way?”
At SAHBA, we’ve
heard it enough, so we decided to spend some serious time and effort
researching just when does growth pay its way?
When do local governments begin making a profit from growth?
The results are
astonishing.
Using data from
the Census of Governments, where all units of government report line item
expenses, revenues and intergovernmental transfers, and data from the US Census
Bureau, the National Association of Home Builders Housing Policy Department
studied
The NAHB Housing Policy Department’s
economists looked at our local governments and balanced revenues from housing
vs. cost of services for housing.
If you assume that the operating
surplus is first used to service and pay down debt incurred by housing
investing, structures and equipment at the start of the first year, the data
shows that growth pays for itself by the end of the fourth year.
That’s worth repeating: growth pays for itself by the end of the
fourth year. After that, it is a revenue
generator for local government. That
finding is for all of
In
This research,
along with an aggressive multi-media education campaign, will be used to tell
the public the facts: that home
construction creates a positive cash flow to our area’s economy and to
local governments.
Our members are
doing business in an environment of ever-increasing government fees. Our point is that even without increases in
capital facility fees, growth pays its way and provides the needed
infrastructure just on its tax contributions to the economy.
Put on top of that the job creation and social stability that housing provides and you have one powerful story to tell. I am going to thoroughly enjoy telling it.