Chapter 10 Commercial/Industrial Land Use Analysis

Transcription

1 Chapter 10 Land Use Analysis land use is a very important component of Anoka s land use. It provides significant tax revenue, and in the last analysis, it provides a surplus of revenues over expenditures, or Fiscal Impact. The following discussion deals with some of the significant factors that contribute to this Fiscal Impact. Map shows the commercial and industrial land use as of A. Employment Employment is one of the factors that generate (C/I) revenues and expenditures. The weight given to employment is relatively small, compared to the weight given to population, but since the C/I uses are where most of the employees are located, it is worth examining in more detail. The table below summarizes employment. Note that 66% of the city s employment comes from the C/I uses, with followed by Office with the most. Table Employment Land Use Employment Percent of City Total Office 1, % Shopping 1, % Restaurant % Auto Service % Bank % General Commercial % Motel % Personal Service % School - Commercial % 3, % Light 1, % Totals 9, % City Totals 13, % B. Market Value The uses make up 18% of the city s market value. Tax Capacity is determined by taking a percentage of the Market Value. The first $150,000 is multiplied times 1.5%, and the amount over $150,000 is multiplied by 2%. As a group, the C/II uses make up 18% of the city s Market Value, with the uses making up about 10%, and the Office and Shopping uses making up about 6%. Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-1

2 Map Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-2

3 Table Market Value Land Use Market Value Percent of City Total Office 38,512, % Shopping 53,501, % Restaurant 11,316, % Auto Service 8,127, % Bank 353, % General Commercial 3,520, % Motel 2,492, % Personal Service 7,316, % School - Commercial 2,859, % 95,373, % Light 59,113, % Totals 282,487, % City Totals $1,534,945, % Figure Share of City Market Value 18% Other Uses 82% C. Electrical Billing A significant amount of surplus revenue from the Electrical Utility goes to finance Anoka s Operating budget. The land uses are very big users of electricity and therefore generate over half of that surplus. The table below shows the amount of billing by the C/I categories. Over 40% of the surplus is generated by uses, and about 11% is from Office, Shopping and Restaurants. Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-3

4 Table Electrical Billing Land Use Electrical Billing Percent of City Total Office 704, % Shopping 943, % Restaurant 369, % Auto Service 82, % Bank % General Commercial 3, % Motel 10, % Personal Service 119, % School - Commercial 24, % 5,351, % Light 2,292, % Totals 9,902, % City Totals $18,368, % Figure Share of Electrical Billing Other Uses 46% Commercial / 54% D. Police Calls The Police Department is a big expenditure item for the city. The uses account for over 18% of the Police Calls. Another portion of the Police budget is for patrolling to protect the property in the city. As shown above, over 18% of the Market Value of the city is also, and it is used to allocate a major portion of the Police budget. Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-4

5 Table Police Calls Land Use Police Calls Percent of City Total Office % Shopping 1, % Restaurant % Auto Service % Bank % General Commercial % Motel % Personal Service % School - Commercial % % Light % Totals 3, % City Totals 16, % E. Road Frontage The last significant factor that affects expenditures for is road frontage. The summary table below shows the amount of road frontage (in feet), by jurisdiction for the C/I categories. As far as city finances are concerned, the local and MSA frontage is very important. The Sidewalk frontage is also important, because the city maintains them and plows them in the winter. Since the C/I uses are often located on major city streets, the C/I uses have 24% of the MSA frontage. While the city receives state aid for the MSA frontage, it certainly does not cover all of the maintenance costs. Sidewalks are also important to the C/I uses, with almost 13% of the frontage serving these uses. Table Road Frontage Local MSA Percent of Road Percent of County State Highway US Highway Total Percent of Sidewalk Percent of Land Use Frontage City Total Frontage City Total Frontage Frontage Frontage Frontage City Total Frontage City Total Office 4, % 4, % , % 6, % Shopping 5, % 6, % 5,049 1,300 1,627 19, % 7, % Restaurant 3, % % 1, , % 1, % Auto Service 1, % 1, % 1, , % 1, % Bank % % % % General Commercial 1, % % , % % Motel % % % % Personal Service % 1, % , % 1, % School - Commercial % % % % 10, % 6, % 4,644 1,296 1,249 23, % 5, % Light 6, % 7, % 3, , % 4, % Totals 34, % 29, % 18,352 4,126 4,350 93, % 30, % City Totals 503, % 121, % 76,990 22,662 20, , % 242, % Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-5

6 F. Property Taxes Commercial and uses generate about $2.6 million in property tax revenue in Anoka. A large portion of that revenue is captured by the Tax Increment Financing (TIF) districts, and is mostly available for Capital Expenditures. About 40% is the local captured property tax revenue, and the larger portion (about 60%) is revenue captured from the other taxing jurisdictions. Most of the captured revenue comes from, but a portion is also captured from Residential. Table shows the taxes for the commercial and industrial uses. The column titled Gross Taxes represents the hypothetical amount the city would collect based on the calculated Tax Capacity based on Market Value, about $2.2 million. However, about $750,000 is contributed to the Fiscal Disparities pool. The C/I uses receive a small amount back through the Fiscal Disparities distribution by virtue of the small population residing in these uses. Table Property Taxes, Fiscal Disparities Contribution Fiscal Disparities Distribution Net Collected Taxes Land Use Gross Taxes Captured Local TIF Local TIF Taxes Other Juris. Total TIF Taxes Taxes Office 289, ,162 1,589-90,972 83,073 90, , ,724 Shopping 421, ,365 4, , , , , ,607 Restaurant 85, , ,579 27,785 17,579 21,181 66,545 Auto Service 59, , ,755 21,654 6,755 8,129 36,538 Bank 2, , ,819 3,430 6,249 General Commercial 20, , , ,827 Motel 16, , ,677 20,294 36,971 Personal Service 55, , ,233 13,220 23,233 28,059 64,512 Commercial School 22, , , , , , , , , ,142 1,040,162 Light 461, , , , , , ,691 Totals $2,202,517 -$751,811 $7,213 -$930,543 $527,376 $930,543 $1,122,153 $2,580,072 Next, about $930,000 is captured by the TIF districts. As a result, only about $528,000 remains to finance city operations. That local TIF revenue is not lost, but it is diverted to the capital fund to finance capital improvements. The last columns in the table take the net of $527,000, and add back in the local TIF portion. Since the TIF districts also capture about $1.1 million in property taxes from the other taxing jurisdictions, the total amount of property taxes coming from commercial and industrial adds up to about $2.6 million. However, once the TIF districts are retired, the $1.1 million will no longer be available to the city. What this shows is that while commercial/industrial generates a significant amount of property tax revenue, only about $527 thousand is available for financing operating expenses, resulting in a large burden on the residential uses. The remainder is available for capital improvements, Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-6

7 but a large portion of it will go away after the TIF districts are retired. The impact of the TIF districts is discussed in more detail in a later section. Figure shows total property taxes per acre by detailed land use category. Figure Commercial / Property Taxes per Acre, Including Captured TIF Revenue 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 Taxes per Acre Office Shopping Restaurant Auto Service Bank General Commercial Motel Personal Service Commercial School Light Totals G. Fiscal Impact As discussed in previous chapters, the analysis of Fiscal Impact has been done using two scenarios. One is to look at the patterns as they existed in We refer to this is the current Fiscal Impact. The second scenario deals with the questions what if there were no TIF districts in the city? or what will be the patterns after the TIF districts are retired? 1. Current Fiscal Impact Current Fiscal Impact is the pattern of revenues, expenditures, surpluses and deficits that existed in 2009 for both operating and capital budgets. a. Current Operating Fiscal Impact Table and Figure below show the current operating Fiscal Impact for commercial and industrial land uses in the city. As pointed out earlier, the residential land uses bear most of the burden for operating revenue, because property taxes from the TIF districts are captured and used for capital improvements. Table and Figure summarize the operating Fiscal Impact for commercial and industrial. Note that while the C/I uses overall generate a very small surplus, many of the commercial uses generate deficits. This is because Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-7

8 some of them are in TIF districts, and their property taxes are captured for TIF. The industrial uses generate modest surpluses. In the case of the bank parcels, the acreage is so small that when computed on a per acre basis, the result is exaggerated. Table Current Operating Fiscal Impact $ per Acre, Commercial &, Surplus or S/D per Land Use Acres Revenue Expenses Deficit Acre Office , ,078-59,414-1, Shopping , ,089-30, Restaurant , ,886 21,985 1, Auto Service ,477 43, Bank ,002 4,844-2,843-7, General Commercial ,948 16,260 2, Motel ,248 12,072-7,824-1, Personal Service ,807 41,699-1, Commercial School ,101 11,590 3,511 1, , ,951 53, Light , ,967 31, Totals $1,658,249 $1,647,375 $10,874 $ , , , , , , Figure Current Operating Fiscal Impact $ per Acre, Commercial & 0.00 Office Shopping Restaurant Auto Service Bank General Commercial Motel Personal Service Commercial School Light b. Current Capital Fiscal Impact The property tax revenue that is captured for the TIF districts is available for capital projects. Table and Figure show the impact of the captured revenue on the capital Fiscal Impact. All of the C/I categories generate surpluses, except for the general commercial category. Note that the uses like office, shopping and bank, which had large deficits under the Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-8

9 operating budget, show large surpluses for the capital budget. The uses also have larger surpluses. Overall, the C/I uses average a surplus of about $2500 per acre. Table Current Capital Fiscal Impact $ per Acre, Commercial & Land Use Acres Revenue Expenses Surplus or Deficit S/D per Acre Office ,012 97, ,182 4, Shopping , , ,425 5, Restaurant ,538 23,836 30,703 2, Auto Service ,932 15,081 10, Bank , ,747 17, General Commercial ,378 7,779-1, Motel ,644 12,713 26,931 6, Personal Service ,138 12,303 48,836 7, Commercial School ,114 1,690 2, ,192, , ,285 1, Light , , ,414 2, Totals $2,612,224 $1,148,828 $1,463,397 $2, , , , , , , , , , , , Figure Current Capital Fiscal Impact $ per Acre, Commercial & Office Shopping Restaurant Auto Service Bank General Commercial Motel Personal Service Commercial School Light c. Current Total Fiscal Impact The current total Fiscal Impact is the combination of operating and capital components. Table and Figure summarize the total impact for the commercial and industrial uses. When added together, the most of the C/I uses generate large surpluses. Some of this is due to the fact that through the TIF districts they have also captured revenue from the other taxing jurisdictions. Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-9

10 When the TIF districts are retired, this extra revenue will not be available; the next section will investigate the impact of this reduction. Table Current Total Fiscal Impact $ per Acre, Commercial & Surplus or S/D per Land Use Acres Revenue Expenses Deficit Acre Office , ,908 88,768 2,725 Shopping , , ,049 4,616 Restaurant , ,721 52,688 4,235 Auto Service ,409 59,020 11, Bank ,877 4,973 3,904 10,104 General Commercial ,326 24,039 1, Motel ,892 24,785 19,107 4,401 Personal Service ,946 54,001 46,945 7,020 Commercial School ,215 13,279 5,935 1, ,743,542 1,130, ,485 2,045 Light , , ,714 2,582 Totals $4,270,473 $2,796,203 $1,474,270 $2,571 Figure Current Total Fiscal Impact $ per Acre, Commercial & 12,000 10,000 8,000 6,000 4,000 2,000 0 Office Shopping Restaurant Auto Service Bank General Commercial Motel Personal Service Commercial School Light d. Current Fiscal Impact by Parcel The analysis provided in this report is the result of the development of a detailed parcel database. In some cases the allocation factors have been estimates, but in other cases, revenue and expenditure items have been directly assigned to a parcel when that information is known. Map shows the parcel level Fiscal Impact results for the residential land uses. The Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-10

11 Map Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-11

12 objective is not to show precisely the Fiscal Impact of each individual parcel, since in many cases we had to use averages. The shades of red show deficits and the shades of green show surpluses. The map shows the variations that can exist from one parcel to another. 2. Future Fiscal Impact, without TIF The second scenario to be investigated is what will be the impact when the TIF districts are retired? a. Future Operating Fiscal Impact The impact of the elimination of the TIF districts on the operating budget is shown in Table and Figure 10.07, below. Most of the commercial and industrial uses generate modest to substantial surpluses, with an overall average of about $1200 per acre. These surpluses are due to the fact that when the TIF districts are retired, the local portion of the property taxes will be recaptured and available for the operating budget. There are exceptions to this pattern of surplus, however. The office and bank categories generate deficits. In the case of offices, this is surprising because the 1986 study showed offices with a surplus. As noted above, the bank acreage is very small, so when the deficit is calculated on a per acre basis, the result is exaggerated. More investigation of these two uses needs to be done. Table Future Operating Fiscal Impact $ per Acre, Commercial and, City of Anoka Surplus or S/D per Land Use Acres Revenue Expenses Deficit Acre Office , , Shopping , ,089 82,899 1,271 Restaurant , ,886 23,971 1,927 Auto Service ,158 43,940 2, Bank ,343 4, ,296 General Commercial ,761 16,260 1, Motel ,852 12,072 6,780 1,562 Personal Service ,797 41,699 15,099 2,258 Commercial School ,606 11,590 2, , , ,390 1,211 Light , , ,861 1,471 Totals $2,332,414 $1,647,375 $685,039 $1,194 Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-12

13 Figure Future Operating Fiscal Impact $ per Acre, Commercial & 2,500 2,000 1,500 1, ,000-1,500 Office Shopping Restaurant Auto Service Bank General Commercial Motel Personal Service Commercial School Light b. Future Capital Fiscal Impact The future capital Fiscal Impact is show on Table and Figure below. As stated earlier, the local portion of the captured TIF revenue has been shifted to the operating budget. This generates a surplus in the operating budget, which is transferred back to the capital budget. See Chapter 7 for more detail on this. With the end of the TIF districts, the captured revenue from the other taxing jurisdictions will no longer be available for capital projects. As a result, the expenditures had to be reduced to balance the capital budget. The patterns for commercial and industrial uses show some surprises. Here we see that the industrial uses as well as the motel, have a deficit. We have assumed that the reductions in capital expenditures would be proportional to the capital expenditures for In reality, after the TIF districts are retired, there may not be as much need for capital improvements in the industrial areas, because the TIF program has already financed all of those needs. Therefore when using this particular table, one should be mindful of the fact that the reduction of expenditures may not be done the way that it has, in reality. More evaluation of this assumption, and work with city staff needs to be done. Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-13

14 Table Future Capital Fiscal Impact $ per Acre, Commercial and, City of Anoka Surplus or Land Use Acres Revenue Expenses Deficit S/D per Acre Office ,114 70,274 6, Shopping ,201 81,398 54, Restaurant ,371 17,122 14,249 1,145 Auto Service ,122 10,833 5, Bank , ,012 2,618 General Commercial ,634 5,588 1, Motel ,745 9,132-4,387-1,011 Personal Service ,090 8,837 7,252 1,085 Commercial School ,609 1,214 4,395 1, , ,064-60, Light , ,689-39, Totals $815,906 $825,244 -$9,338 -$16 Figure Future Capital Fiscal Impact $ per Acre, Commercial and 3,000 2,500 2,000 1,500 1, ,000-1,500 Office Shopping Restaurant Auto Service Bank General Commercial Motel Personal Service Commercial School Light c. Future Total Fiscal Impact Table and Figure show the composite of the operating and capital budgets under the scenario that is supposed to answer the question: what will be the effect of eliminating or retiring the TIF districts? Keeping in mind the caveat that our reduction of capital expenditures may not be realistic, the results overall show that the commercial and industrial all show modest to substantial surpluses, despite the fact that the city no longer has the captured TIF revenue. Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-14

15 Table Future Total Fiscal Impact $ per Acre, Commercial and, City of Anoka Surplus or S/D per Land Use Acres Revenue Expenses Deficit Acre Office , ,352 6, Shopping , , ,703 2,111 Restaurant , ,007 38,220 3,072 Auto Service ,280 54,773 7, Bank ,447 4, ,321 General Commercial ,395 21,848 2, Motel ,598 21,204 2, Personal Service ,887 50,536 22,351 3,342 Commercial School ,215 12,804 6,411 2, ,255, , ,385 1,011 Light , , ,029 1,159 Totals $3,148,320 $2,472,619 $675,701 $1,178 Figure ,000 3,500 3,000 2,500 2,000 1,500 1, Future Total Fiscal Impact $ per Acre, Commercial and Office Shopping Restaurant Auto Service Bank General Commercial Motel Personal Service Commercial School Light Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-15