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 10.01 shows the commercial and industrial land use as of 2009. 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 10.01 Employment Land Use Employment Percent of City Total Office 1,805 13.03% Shopping 1,386 10.00% Restaurant 492 3.55% Auto Service 125 0.90% Bank 45 0.32% General Commercial 23 0.17% Motel 12 0.09% Personal Service 121 0.87% School - Commercial 39 0.28% 3,677 26.54% Light 1,442 10.41% Totals 9,167 66.16% City Totals 13,855 100.00% 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
Map 10.01 Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-2
Table 10.02 Market Value Land Use Market Value Percent of City Total Office 38,512,200 2.51% Shopping 53,501,200 3.49% Restaurant 11,316,400 0.74% Auto Service 8,127,600 0.53% Bank 353,900 0.02% General Commercial 3,520,700 0.23% Motel 2,492,600 0.16% Personal Service 7,316,000 0.48% School - Commercial 2,859,600 0.19% 95,373,600 6.21% Light 59,113,500 3.85% Totals 282,487,300 18.40% City Totals $1,534,945,900 100.00% Figure 10.01 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
Table 10.03 Electrical Billing Land Use Electrical Billing Percent of City Total Office 704,904 3.84% Shopping 943,980 5.14% Restaurant 369,485 2.01% Auto Service 82,941 0.45% Bank 0 0.00% General Commercial 3,834 0.02% Motel 10,149 0.06% Personal Service 119,398 0.65% School - Commercial 24,242 0.13% 5,351,338 29.13% Light 2,292,260 12.48% Totals 9,902,530 53.91% City Totals $18,368,158 100.00% Figure 10.02 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
Table 10.04 Police Calls Land Use Police Calls Percent of City Total Office 510 3.10% Shopping 1,201 7.29% Restaurant 484 2.94% Auto Service 138 0.84% Bank 2 0.01% General Commercial 49 0.30% Motel 53 0.32% Personal Service 138 0.84% School - Commercial 25 0.15% 229 1.39% Light 178 1.08% Totals 3,007 18.27% City Totals 16,462 100.00% 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 10.05 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 4,908 0.97% 4,800 3.96% 0 581 641 14,066 1.89% 6,330 2.61% Shopping 5,324 1.06% 6,124 5.05% 5,049 1,300 1,627 19,424 2.61% 7,592 3.13% Restaurant 3,101 0.62% 788 0.65% 1,085 74 266 5,314 0.71% 1,419 0.59% Auto Service 1,686 0.33% 1,381 1.14% 1,602 132 246 5,047 0.68% 1,609 0.66% Bank 0 0.00% 280 0.23% 0 0 0 280 0.04% 214 0.09% General Commercial 1,173 0.23% 750 0.62% 940 0 66 2,929 0.39% 981 0.40% Motel 441 0.09% 0 0.00% 0 0 0 441 0.06% 283 0.12% Personal Service 382 0.08% 1,736 1.43% 982 0 0 3,101 0.42% 1,687 0.70% School - Commercial 210 0.04% 286 0.24% 146 0 255 897 0.12% 286 0.12% 10,180 2.02% 6,104 5.03% 4,644 1,296 1,249 23,472 3.15% 5,463 2.25% Light 6,734 1.34% 7,155 5.90% 3,904 743 0 18,536 2.49% 4,877 2.01% Totals 34,139 6.78% 29,404 24.25% 18,352 4,126 4,350 93,508 12.56% 30,741 12.68% City Totals 503,542 100.00% 121,266 100.00% 76,990 22,662 20,517 744,706 100.00% 242,390 100.00% Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-5
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 10.06 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 10.06 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 289,617.92-117,162 1,589-90,972 83,073 90,972 109,679 283,724 Shopping 421,857.44-153,365 4,851-161,638 111,706 161,638 195,263 468,607 Restaurant 85,264.74-39,901 0-17,579 27,785 17,579 21,181 66,545 Auto Service 59,434.77-31,026 0-6,755 21,654 6,755 8,129 36,538 Bank 2,819.09 0 0-2,819 0 2,819 3,430 6,249 General Commercial 20,519.43-11,623 0-765 8,131 765 931 9,827 Motel 16,676.90 0 0-16,677 0 16,677 20,294 36,971 Personal Service 55,570.86-19,118 0-23,233 13,220 23,233 28,059 64,512 Commercial School 22,461.83-13,215 0 0 9,247 0 0 9,247 766,524.35-214,504 0-404,869 147,151 404,869 488,142 1,040,162 Light 461,769.99-151,897 773-205,236 105,410 205,236 247,045 557,691 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
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 10.03 shows total property taxes per acre by detailed land use category. Figure 10.03 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 2009. 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 10.07 and Figure 10.04 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 10.07 and Figure 10.04 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
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 10.07 Current Operating Fiscal Impact $ per Acre, Commercial &, Surplus or S/D per Land Use Acres Revenue Expenses Deficit Acre Office 32.58 229,664 289,078-59,414-1,823.91 Shopping 65.22 326,714 357,089-30,375-465.76 Restaurant 12.44 139,870 117,886 21,985 1,766.98 Auto Service 12.31 44,477 43,940 537 43.63 Bank 0.39 2,002 4,844-2,843-7,356.71 General Commercial 8.78 18,948 16,260 2,688 306.07 Motel 4.34 4,248 12,072-7,824-1,802.30 Personal Service 6.69 39,807 41,699-1,891-282.82 Commercial School 3.05 15,101 11,590 3,511 1,153.10 300.02 551,151 497,951 53,200 177.32 Light 127.70 286,267 254,967 31,300 245.11 Totals 573.51 $1,658,249 $1,647,375 $10,874 $18.96 4,000.00 2,000.00-2,000.00-4,000.00-6,000.00-8,000.00 Figure 10.04 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 10.08 and Figure 10.05 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
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 10.08 Current Capital Fiscal Impact $ per Acre, Commercial & Land Use Acres Revenue Expenses Surplus or Deficit S/D per Acre Office 32.58 246,012 97,830 148,182 4,548.95 Shopping 65.22 444,739 113,314 331,425 5,081.87 Restaurant 12.44 54,538 23,836 30,703 2,467.64 Auto Service 12.31 25,932 15,081 10,851 881.20 Bank 0.39 6,876 129 6,747 17,460.86 General Commercial 8.78 6,378 7,779-1,401-159.50 Motel 4.34 39,644 12,713 26,931 6,203.41 Personal Service 6.69 61,138 12,303 48,836 7,302.99 Commercial School 3.05 4,114 1,690 2,424 796.00 300.02 1,192,392 632,106 560,285 1,867.50 Light 127.70 530,463 232,049 298,414 2,336.86 Totals 573.51 $2,612,224 $1,148,828 $1,463,397 $2,551.66 20,000.00 18,000.00 16,000.00 14,000.00 12,000.00 10,000.00 8,000.00 6,000.00 4,000.00 2,000.00 0.00-2,000.00 Figure 10.05 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 10.09 and Figure 10.06 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
When the TIF districts are retired, this extra revenue will not be available; the next section will investigate the impact of this reduction. Table 10.09 Current Total Fiscal Impact $ per Acre, Commercial & Surplus or S/D per Land Use Acres Revenue Expenses Deficit Acre Office 32.58 475,676 386,908 88,768 2,725 Shopping 65.22 771,453 470,403 301,049 4,616 Restaurant 12.44 194,409 141,721 52,688 4,235 Auto Service 12.31 70,409 59,020 11,389 925 Bank 0.39 8,877 4,973 3,904 10,104 General Commercial 8.78 25,326 24,039 1,287 147 Motel 4.34 43,892 24,785 19,107 4,401 Personal Service 6.69 100,946 54,001 46,945 7,020 Commercial School 3.05 19,215 13,279 5,935 1,949 300.02 1,743,542 1,130,057 613,485 2,045 Light 127.70 816,729 487,015 329,714 2,582 Totals 573.51 $4,270,473 $2,796,203 $1,474,270 $2,571 Figure 10.06 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 10.02 shows the parcel level Fiscal Impact results for the residential land uses. The Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-10
Map 10.02 Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-11
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 10.10 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 10.10 Future Operating Fiscal Impact $ per Acre, Commercial and, City of Anoka Surplus or S/D per Land Use Acres Revenue Expenses Deficit Acre Office 32.58 288,882 289,078-195 -6 Shopping 65.22 439,988 357,089 82,899 1,271 Restaurant 12.44 141,856 117,886 23,971 1,927 Auto Service 12.31 46,158 43,940 2,218 180 Bank 0.39 4,343 4,844-501 -1,296 General Commercial 8.78 17,761 16,260 1,501 171 Motel 4.34 18,852 12,072 6,780 1,562 Personal Service 6.69 56,797 41,699 15,099 2,258 Commercial School 3.05 13,606 11,590 2,016 662 300.02 861,342 497,951 363,390 1,211 Light 127.70 442,828 254,967 187,861 1,471 Totals 573.51 $2,332,414 $1,647,375 $685,039 $1,194 Anoka Fiscal Impact Analysis, 2009, by GISRDC.com 10-12
Figure 10.07 Future Operating Fiscal Impact $ per Acre, Commercial & 2,500 2,000 1,500 1,000 500 0-500 -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 10.11 and Figure 10.08 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 2009. 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
Table 10.11 Future Capital Fiscal Impact $ per Acre, Commercial and, City of Anoka Surplus or Land Use Acres Revenue Expenses Deficit S/D per Acre Office 32.58 77,114 70,274 6,840 210 Shopping 65.22 136,201 81,398 54,803 840 Restaurant 12.44 31,371 17,122 14,249 1,145 Auto Service 12.31 16,122 10,833 5,289 429 Bank 0.39 1,104 93 1,012 2,618 General Commercial 8.78 6,634 5,588 1,046 119 Motel 4.34 4,745 9,132-4,387-1,011 Personal Service 6.69 16,090 8,837 7,252 1,085 Commercial School 3.05 5,609 1,214 4,395 1,443 300.02 394,059 454,064-60,006-200 Light 127.70 126,857 166,689-39,832-312 Totals 573.51 $815,906 $825,244 -$9,338 -$16 Figure 10.08 Future Capital Fiscal Impact $ per Acre, Commercial and 3,000 2,500 2,000 1,500 1,000 500 0-500 -1,000-1,500 Office Shopping Restaurant Auto Service Bank General Commercial Motel Personal Service Commercial School Light c. Future Total Fiscal Impact Table 10.12 and Figure 10.09 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
Table 10.12 Future Total Fiscal Impact $ per Acre, Commercial and, City of Anoka Surplus or S/D per Land Use Acres Revenue Expenses Deficit Acre Office 32.58 365,997 359,352 6,645 204 Shopping 65.22 576,189 438,487 137,703 2,111 Restaurant 12.44 173,227 135,007 38,220 3,072 Auto Service 12.31 62,280 54,773 7,507 610 Bank 0.39 5,447 4,937 511 1,321 General Commercial 8.78 24,395 21,848 2,547 290 Motel 4.34 23,598 21,204 2,393 551 Personal Service 6.69 72,887 50,536 22,351 3,342 Commercial School 3.05 19,215 12,804 6,411 2,105 300.02 1,255,400 952,015 303,385 1,011 Light 127.70 569,685 421,655 148,029 1,159 Totals 573.51 $3,148,320 $2,472,619 $675,701 $1,178 Figure 10.09 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 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