AGA fiscal impact studies identify the recurring net annual effect of real estate development on the operating budget of the city or county agency responsible for providing those public services (police, fire, community services, etc.) likely to be demanded by project activities. Fiscal impact studies represent a specialized form of cost-benefit analysis used to determine if development and occupancy of real estate pursuant to a proposed project or land use policy represents a net benefit or burden for the operating service structure of the affected agency. Fiscal impact studies are not strictly limited to the effects on city or county governments but increasingly are being required to address the effects on other public service agencies (school districts, library districts, flood control districts, community service areas, etc.).
AGA's analysis of fiscal impact involves a detailed review of the current year operating budget of the affected agency in order to identify relevant operating revenue and expense factors and the fixed and variable costs dictated by the delivery structure of the agency's service scope. Our fiscal impact studies often involve considerable contact and communication with representatives of the affected agency to properly identify incremental revenue and cost components. Proper characterization of the agency's fiscal service structure requires close scrutiny of operating practices not generally disclosed in normal budget reporting detail.
In most instances, our fiscal impact studies rely on a per acre increment approach rather than per capita multipliers in order to distinguish among the many forms of land use activity that drive fiscal revenue and cost components. This approach is more accurate in determining how different types and intensities of land use impact the service delivery structure of an affected agency. This level of reporting is also necessary to demonstrate how individual components of the overall development program contribute to projected fiscal performance. This detailed level of reporting permits AGA to test alternative project scenarios in a cost-effective manner.
AGA's baseline analysis reflects a static model that identifies the recurring annual effect at buildout. More dynamic forms of analysis also address the incremental and cumulative effect of a proposed project over a developer-prescribed phasing period.
Clients who rely on our fiscal impact studies include private developers and public agencies alike. Some of the government agencies that have utilized our services to evaluate the merits of proposed land use and economic development policies include the Cities of Mission Viejo, San Juan Capistrano, Irvine, Arcadia, Big Bear Lake, along with Imperial, Kern, and Ventura Counties. Private development interests that have relied on our fiscal impact approach include LNR Property Corporation, Rancho Mission Viejo, Tejon Ranch, Santa Margarita Company, Rose Hills Company, Makar Properties, Shea Properties Management Co., Inc., Metropolitan Water District of Southern California, ICI Development, Majestic Realty, and many others.
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