A growth obstacle falls

Study shows that an urbanized Columbia could yield millions in taxes

County may profit from growth plan

September 29, 2006|BY A SUN REPORTER

The plan to transform downtown Columbia into a dense, urban city has passed a significant test, now that a financial analysis shows that it would not be an economic albatross on the county.

The study, completed recently by the county's Department of Planning and Zoning, indicates that the county would be the beneficiary of a net gain of millions of dollars annually in taxes if the sweeping project were completed.

While the plan still faces many obstacles, the financial analysis is important to officials because it permits them to proceed with the comfort that there are no dire implications for the county.

"It's not that we look at what generates the greatest revenue," said Marsha S. McLaughlin, director of the planning department, which is spearheading the downtown project. "We use it to identify gross negatives ... . Those would be red flags."

Jeffrey Bronow, chief of the department's Division of Research, prepared the study, presented this week to a 23-member focus group that has spent almost a year deliberating on how downtown Columbia should develop.

That panel will neither make formal recommendations nor endorse the plan, but its responses to a wide array of issues are expected to influence the proposal's final form, which is due early next year.

The county is exploring whether to convert downtown into a vibrant urban center that promotes the arts and other cultural activities, encourages pedestrian use and provides a variety of retail shops.

To achieve that, though, requires significantly more population, McLaughlin has said repeatedly.

The latest plan proposes, among other things, permitting 5,500 additional housing units, 3 million square feet of new commercial offices and 750,000 square feet for retail.

The Department of Planning and Zoning is considering a height limitation of 14 stories, although it is unclear if that would be an absolute cap or more of a general goal.

Regardless of the ultimate scope of the downtown plan, the county would benefit, according to Bronow's financial analysis.

The study "measures costs and revenues to the public sector," Bronow said.

"Generally, the results are positive," he said. "There is positive net revenues over 30 years."

The analysis suggests that the net gain to the county would be an average of $11.7 million annually if the recommended level of development in downtown occurs. That would mean about $351 million over the three decades that the plan would require before construction is completed.

Most of that would come from the county's property and income taxes, which account for 84 percent of the county's budget.

The study used current tax rates and costs and did not factor in such uncertainties as inflation. It also does not include the costs of public improvements that rely on state or federal funding. "It's a snapshot in time," Bronow said.

The usefulness of the study is that it identifies whether a development could be a financial drain on taxpayers for providing such services as schools, road improvements and fire and police, McLaughlin said.

The department has performed financial studies to determine the effect of policies in the general plan and the blueprint for development countywide, as well as for some large planned communities, such as Maple Lawn, Maryland, near Fulton.

One of the central issues to any financial analysis is the potential cost to the school system. But Bronow said a significant influx of new students is not expected even if an additional 5,500 units are built downtown.

It is believed that 90 percent of the housing units would be condominiums or apartments, and those historically have not generated as many students as have single-family homes, he said.

Cynthia Coyle, a member of the task force and of the Columbia Association board, said that because more affordable housing is hoped for, the enrollment trend, and thus Bronow's assumption, might be affected.

County officials said fewer than 700 of the housing units would be for middle-income earners, and they doubt that the school system will face a surge in enrollment because of the development downtown.

The task force is nearing the completion of its deliberations and is not scheduled to meet again until early next year.

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