SECTION I - INTRODUCTION

Impact fees are the monetary charges imposed by local governments on developers. These fees allow the government to recoup additional costs to accommodate the new development. Expanding communities and growing cities bring with them both new revenue generating capability and additional expenditure burden to a local government. It is often easier to acknowledge the increased revenue potential from further real estate, personal property, and sales taxes than it is to identify the added expenditures necessary to provide the new development with water and waste water treatment, educational facilities, and public safety. There are, of course, many other expenditure demands on a local government as well as several additional revenue generating factors. In order to accurately levy an impact fee, all facets of both sides of the balance sheet must be evaluated carefully.

The purpose of this report is to present the results of the fiscal impact analysis for the proposed development of the Hunt Field area and annexation into the City of Charles Town, West Virginia (hereafter the City). The objective is to estimate the fiscal flows for the City and Jefferson County Board of Education. This includes operating revenues and expenditures that would be generated by the proposed development. The results present the fiscal flows associated with each proposed land use: single family homes, town homes, multi-family homes, retail commercial space, and office commercial space. The summation of the impacts from each of the land uses represents the total fiscal impacts to the City and the Board of Education. From the total fiscal impacts, it can be determined whether there is a positive or negative net fiscal impact on the City and the Board of Education. This information can then be used to determine whether to levy an impact fee, and if necessary how much should be levied.

The City has proposed the annexation of the Hunt Field area into the City. This land currently sits approximately one mile south of the City. This report presents an analysis of the fiscal impacts of the Hunt Field Development on the City and the Jefferson County Board of Education. The analysis relies on the evaluation of the financial records of both the City and Board of Education as well as an economic model of social accounting. The methods are described in greater detail in the methodology section (Section II). The end result of the analysis is the recommendation that the City would need to assess the developers $700 per residential unit built in order to meet the growing fiscal demand for operational expenditures on the local government. The impact fee is isolated to the residential development because there are negative net impacts on the local government’s support of residential needs that are not entirely offset by net positive impacts from non-residential development. In fact, as shown in the appendix tables, the non-residential development creates a positive net fiscal impact while the residential development creates a negative fiscal impact. It seems natural to assess the impact fee on the development that creates the additional burden on the local government.

The City is a small, growing community located in the far eastern panhandle of West Virginia. It is not more than ten miles from the Maryland and Virginia borders, and approximately 65 miles from Washington, DC. There are approximately 3,000 residents of the City according to the 2000 U.S. Census. With the annexation of Hunt Field, and the proposed development of this land, it is estimated that the City would add 8,275 new residents and 1,877 new students over the 20 year build out period.[1] The developers have proposed a schedule of development to take place over a 20 year period.

The Hunt Field Development plans[2] cover an area of approximately 1,040 acres of previously undeveloped land. The development would be made up of 3,200 residential housing units, 200,000 square feet of retail and commercial office space, 130 acres designated for recreational and natural uses, 10 acres designated for civic uses, and 75 acres to be donated to the Board of Education for the location of three new schools. The residential development would consist of 1,947 single family homes, 803 town houses, and 450 apartment units. The 200,000 square feet is planned to be evenly split (100,000 square feet each) between retail and commercial office space. This development and annexation would significantly increase the population and employment within the City.

The remainder of this report is organized as follows. Section II describes in detail the methodology used to analyze the fiscal impacts. Section III includes an analysis of the City budget and the effects of the development on the City budget. Section IV presents a similar analysis of the Board of Education budget. Section V shows phasing schedule of development and estimates of annual fiscal flows based on the phasing schedule. Finally, Section VI provides a summary and recommendations.

SECTION II - METHODOLOGY

This section is designed to provide a clear outline of the steps taken to arrive at the fiscal impacts of the proposed Hunt Field Development. The purpose is to allow the reader to follow the subsequent sections and provide the necessary economic background to fully understand the fiscal impact study. This study uses financial data from the City and the Board of Education along with socioeconomic and demographic data and regional industry characteristics provided by the Minnesota Implan Group, Inc. The methodology consists of the collecting and analyzing the data. After the initial checking of the data a deeper modeling effort is conducted using the IMPLAN software and average cost methods in order to arrive at the fiscal impacts.

Average costs simply use the existing costs per person to estimate the future costs dependent upon the increase in population or students. The alternative to this method would be to use marginal costs. Marginal costs would be more appropriate in a situation where the average costs are expected to increase or decrease dramatically as population increases. An example of this type of situation would be when new water treatment capacity would be needed to serve the increase in population. If that were the case, the marginal costs of serving increasing population would rise quickly when the number of water users reached the capacity of the treatment plant. When that would happen, the plant would have to be expanded, generating higher costs to serve the growing demand. In the case of Charles Town, the City facilities have enough capacity to meet the growing demand, and the costs of additional service should remain approximately constant, therefore making an average cost method more appropriate.

The method of using average costs is used because the demand for most local services is reflected in the capacity of the existing infrastructure. In other words, the existing City facilities could be expanded proportionally to serve the expected increase in population that would result from the development of the Hunt Field property. One exception to this is the school facilities, but the developers have proposed land on the site for new schools that would serve the growing demand for space requirements facing the Board of Education. The capital costs associated with building new schools, and all other potential capital costs have not been included in this analysis upon the instruction of the City. Water treatment and wastewater facilities are currently operating with enough excess capacity that capital contributions to the system would not be necessary to serve the increased demand generated from the proposed development. There would be general increases in the costs of servicing additional users in the way of supplies and staffing considerations. Staffing considerations are more likely to directly affect public safety and Board of Education expenditures than other City services.

The purpose of the initial phase of data analysis is to determine the existing conditions in the City. This includes assessing the financial flows, as well as understanding the capacity of the infrastructure. The existing property values are used to estimate the percentage revenues from residential and non-residential sources. The existing expenditure requirements are also calculated from the existing property values and population characteristics. Estimating the per capita revenue generation and expenditure requirements are based on the average costs under the existing City conditions.

The average costs methodology implicitly assumes that the average expenditures per capita and per pupil are the best estimates of future expenditures. Additionally, existing service levels are assumed to remain constant into the future. A third assumption is that the existing distribution of expenditures (allocation factors) remains constant into the future. And the fourth assumption is that the government multiplier effect plays a role in local government finances. The multiplier depends on the tax rates and the local supply and demand for consumer goods. When a larger share of consumer and intermediate goods are produced and purchased locally, the result is a larger multiplier effect. This fifth assumption makes analysis with IMPLAN a deeper study into the fiscal flows of the City and therefore a deeper impact assessment.

The modeling effort incorporates the existing fiscal conditions and the socioeconomic data for Jefferson County in order to estimate the impacts of the proposed development. The model used is provided by the Minnesota Implan Group. The model is a regional economic impact model that allows the user to specify an economic event, or series of events and with additional background information computes economic and fiscal impacts of the event. While that sounds rather simple, it is important to recognize that the IMPLAN model is not just a black box into which data can be entered and the solution is presented. The model is a tool that can assist in the overall analysis of the data, and that is designed to provide estimates based upon the existing local economy. The output from IMPLAN must then be interpreted by the analyst. For example, the software produces outputs directly for several tax categories that are common among most local governments.[3] Other revenue categories are included in the output for total local revenues, and can be separated out according to the existing revenue generating shares. The existing revenue generating shares are based on population, existing assessed property value, and housing type. Allocating the total revenues to the appropriate mix of local revenues completes the interpretation of output from the IMPLAN software. Minnesota Implan Group also maintains and provides local data sets delineated by county.

The methodology employed by the IMPLAN model is a combination of economic input-output modeling and a social accounting framework. The input-output modeling describes the flow of money through an economy. When a dollar is spent to purchase a product in a local economy, that dollar has a direct effect as well as secondary effects, which are typically separated into indirect effects and induced effects. The direct effect of the dollar spent is that it represents one dollar of income to the recipient. The secondary effects of that dollar are generated from how that dollar is subsequently used. A portion of that dollar may be used again within the local economy; a portion may be spent outside the local economy; and a portion may be used to pay taxes. Standard input-output models describe the portion of the dollar that stays within the local economy. The IMPLAN model uses social accounting to also describe the portion of the dollar that is transferred to the federal, state, and local governments. Social accounting is the term used for incorporating the government institutions into the modeling framework. Without the social accounting, the model would simply explain the flow of money from households to businesses, and between businesses. The social accounting adds government purchases and government tax sources into the model. This allows the analyst to generate estimates of fiscal impacts of a proposed project. This impact analysis is ultimately interested in the portion of taxes that are transferred to the local government.

The IMPLAN model uses what are known as multipliers to calculate the impacts of an economic stimulus. In the IMPLAN model, the multipliers are developed from an analysis of the linkages and leakages in the economy. Linkages can be best defined as the interaction of two parties in the local economy. The greater the level of local interaction, the higher percentage of income remains in the local economy and the higher the resulting multiplier. Conversely, the development of multipliers must also account for the leakages in the local economy. Leakages can be best defined as the portion of local income that is spent on imported purchases and non-local taxes. For example, a portion of income is allocated to Federal and State taxes or for businesses to purchase supplies that are not locally manufactured. In Charles Town, the level of imported purchases is great, and the result is lower multipliers than one would find in a larger city or in a city with an industrial sector. Ultimately, the linkages and leakages depend on the availability of goods and services provided locally, and the industry multipliers reflect this information.

The multipliers are calculated for each industry in the local economy. This would include various retail businesses, financial and consulting services, construction, food services, and all other industries located within the City. The multipliers for these industries help to determine the additional indirect business taxes that would be generated from the proposed new development.

The IMPLAN model provides two key elements to this study. The first is the local multiplier. The multipliers are calculated through a general equilibrium model known as input-output analysis. A general equilibrium model takes into account both supply and demand conditions when formulating the results, rather than simply approaching an economic question from solely the producer’s view. The IMPLAN software not only provides the framework for the model, but the company also maintains a database of necessary demographic and socioeconomic data used to calculate the specific relationships between local producers and consumers for specific local areas. The data sets are delineated by county. The impacts calculated for this report have been performed using the Jefferson County, WV data set. The model allows for the data set to be altered by the user in order to most accurately reflect the user’s interpretation of the existing economic conditions. The data set was altered to only include the types of businesses within the City, while maintaining the consumer demand functions of Jefferson County. This carries the assumption that the demand conditions in Charles Town are the same as those in Jefferson County. This is a reasonable assumption based on the similar demographic and socioeconomic characteristics of the City and County. See appendix for demographic and socioeconomic data.

The second element that IMPLAN provides is the capability to estimate the number of jobs that would be created from the proposed non-residential development. The employment data used is from the County Business Patterns, a program run by the U.S. Department of Census, and the ES 202, a wage and employment data set maintained by the Bureau of Economic Analysis. This data set describes the industrial structure of the local economy, with one caveat pointed out by Minnesota Implan Group that there is generally a three year time lag between the current year and the most recent County Business Patterns data. In this case, that should not raise significant concerns because the financial data being used is year 2000, and industry structure adjusts slowly. The County Business Patterns data is used with the estimated value and type of the non-residential land use to estimate the number of jobs the land use will employ. The calculation is based on the output per worker ratio across the various industries that make up the local economy. The calculation for jobs created by the non-residential land use of Hunt Field is 506 jobs. This is the aggregate of 308 jobs created by the development of 100,000 square feet of retail space, and 198 jobs created by the development of 100,000 square feet of commercial office space.

The major sources of data used in determining the existing fiscal flows were the Municipality of Charles Town Financial Statements (with Supplemental Information) for the year ending June 30, 2000 and the Jefferson County, WV Board of Education Financial Statements and Supplementary Information for the year ending June 30, 2000. Other key data items include the Rates of Levy for real estate and personal property tax, and the Official Budget Document for the City. Additionally, the real estate values for the proposed development, and the induced population and enrollment are assumptions taken from the developer’s report. This data can be found in the appendix. This report intends to calculate the fiscal impacts based upon the explained methodology, but using equivalent data to the developer’s report. In doing so, the developer’s phasing schedule also remains the same.

SECTION III - ANALYSIS OF CITY BUDGET

This section provides an accounting of the calculated impacts to the City budget, and how they were derived. This includes the expenditure estimates, which are based on existing levels of per capita expenditures, and the revenue estimates, which are based on property tax calculations and the results of the social accounting multiplier analysis from IMPLAN. The results from the IMPLAN software are then used to estimate the revenue impacts that are shown in the appendix tables and summarized in Table III-1. It is important to note that the real estate valuations and the population increases are based on the figures reported by the developer, and this report does not attempt to adjust the forecasted demand for residential housing. This assumption has been made to make use of one set of base data for the analysis.

Table III-1

City of Charles Town Impact Summary

Induced Revenues
Taxes (including interest & penalties)	$ 1,849,019
Real & Personal Property Tax	$ 1,086,641
Business and occupation tax	$ 62,798
Alcoholic beverages tax	$ 93,131
Utility services tax	$ 478,262
Hotel occupancy tax	$ 123,302
Other taxes	$ 4,885
Video lottery revenue	$ 103,254
Licenses, permits and fees	$ 66,801
Franchise fees	$ 80,838
Intergovernmental:
Federal	$ 232,864
State	$ 4,529
Charges for services	$ 139,805
Fines, forfeits, court costs and charges	$ 7,136
Other Revenues	$ 28,809
Total Revenues	$ 2,513,056

Induced Expenditures
General government	$ 674,519
Public Safety	$ 1,400,888
Street and transportation	$ 512,569
Health and Sanitation	$ 1,019
Culture and recreation	$ 112,242
Total Expenditures	$ 2,701,238

Net Impacts	$ (188,183)

The figures in Table III-1 represent impacts in 2000 dollars for full build-out and occupancy of the proposed development. The property taxes were calculated using the expected real estate and personal property values forecasted by the developer. Supporting tables for the calculations can be found in the appendix. Taxes were calculated on the single family homes and the town homes according to the class II property tax rates for residential property owned and occupied by the owner. Multi-family homes and all non-residential development property taxes were calculated at the class IV rates for non-residential and non-owner occupied real estate within City limits. While the IMPLAN software has the capability to estimate property taxes, the decision was made to calculate them individually in this manner because forecasts of the expected property value were given by the developer. This allows the property tax estimates in this analysis to be as accurate as possible using all available information.

The remaining City revenues were calculated using output from the IMPLAN software, with some specific categories calculated directly, such as business taxes, franchise fees, and licenses, and the remaining categories calculated from the overall local tax generated. These categories were allocated a share of the tax generated based on expected population, property values, and the share of existing revenues generated. The City revenues (tax impacts) are generated in IMPLAN based on the characteristics of the economic event. In this analysis the economic event is characterized by the expected property value of the development and the expected population from the residential development, or the expected jobs from the non-residential development. The program can estimate the value of taxes that will be generated by the property being occupied, in the way of property taxes, license fees, non-tax revenues (such as fines), and other taxes. IMPLAN also generates taxes that are paid to higher government levels, such as state and federal. From this it can generate the intergovernmental revenues that a local government can expect to generate.

The induced expenditures reflect the necessary increases in local spending in order to maintain accepted public service levels. There are noticeably large increases in annual expenditures for public safety, general government, and transportation. This is consistent with the current expenditure allocations, and is justified by the large expected population increase. As the City’s population grows, one should certainly expect that the Police Department would need to grow accordingly. The City currently spends little to support the volunteer Fire Department, but it is likely that the City would need to contribute to this service in the future. The City government would need to expand to meet the needs of a growing population base, and the City would need to increase funding of public infrastructure such as City Hall, paved roadways, and parking facilities. All of these areas contribute to the induced expenditures that the City would face with the annexation and development of Hunt Field.

SECTION IV - ANALYSIS OF BOARD OF EDUCATION BUDGET

This section provides a step by step accounting of the calculated impacts to the Board of Education budget, and how they were derived. The expenditure impacts are based solely on the average costs per pupil from the fiscal year 2000 Board of Education financial statements. The revenue impacts are based on the property taxes from the proposed development, the increase in intergovernmental funding based upon increased enrollment, and based on local population increase for other sources of revenue. It is important to note that the assumptions used for property valuation and increased enrollments are strictly based upon the figures supplied by the developer. This report does not attempt to value real estate or challenge the assumptions of the demographic make-up of the proposed new development. Table IV-1 provides summary information for the Board of Education impacts.

Table IV-1

Board of Education Impact Summary

Induced Revenues
Taxes	$ 4,255,402
Other local revenues	$ 297,392
State sources	$ 6,544,000
Federal sources	$ 704,333
Total Revenues	$ 11,801,127

Induced Expenditures	$ 12,591,120

Net Impact	$ (789,993)

The figures in Table IV-1 represent impacts in 2000 dollars for full build-out and occupancy of the proposed development. The expenditures were calculated using general operating expenditures and debt service expenditures for the Board of Education. Expenditures on capital improvements were not included in the per pupil expenditures that were used to calculate the induced expenditures. According to the U.S. Census 2000, public school enrollment for Jefferson County was 7,404 is the year 2000. This figure was used to calculate a per pupil expenditure of $6,708 annually. The induced expenditures assume that the same value will be spent for each additional student to enter the school system. The estimated number of new students, based on the developer’s student generation factor, is 1,877. Therefore, the induced expenditure requirement for the Board of Education is simply the new students multiplied by the per pupil expenditures. This figure is shown in the summary table above.[4]

There were a few additional steps taken to calculate the induced revenues for the Board of Education. The intergovernmental (Federal and State aid) are both calculated on a per pupil basis, similar to the expenditure impacts. The existing per pupil intergovernmental aid was calculated using the year 2000 revenues divided by the enrollment of 7,404. The resulting dollar value of aid per pupil is multiplied by the expected enrollment increase to give an estimate of intergovernmental revenues. This calculation assumes that the State and Federal governments would continue to provide the same level of aid to local education as they currently offer.

Other local revenues are assumed to be based on the population, and are therefore calculated on a per capita basis. The per capita local revenue generation is calculated by dividing the fiscal year 2000 other local revenues by the population in Jefferson County. The local revenue generated from the proposed development was then calculated by multiplying the per capita figure by the expected increase in population. The resulting figure is the calculated other local revenue.

Finally, the tax revenues to the Board of Education were calculated using the fiscal year 2000 tax rates and the expected property values estimated by the developer. The Board of Education tax rates include the school current expense rate, the school excess levy rate, and the school per improvement rate. The details of the calculations are in the supporting tables in the appendix.

SECTION V - FISCAL IMPACT PHASING SCHEDULE

The fiscal impact phasing schedule is required because the developer’s plans are expected to take place over a 20 year period. The development would be phased in, and as a result the impacts would not actually occur all at one time as suggested with the impacts calculated under the assumption of full build out and occupancy. In fact, the City and Board of Education budgets would face greater negative impacts at the earlier stages of development because it is planned for only residential development for the first six years. The first stage of non-residential development occurs in the seventh year of the planned build schedule. This schedule is presented below in Table V-1, and is a direct replication from the developer.

Table V-1

Development Schedule

Year	Units SF	Units TH	Units MF	Sq ft Retail	Sq ft Office	Total units Resid	Total Sq ft Non-Resid
1	60	30				90	0
2	60	30				90	0
3	60	30				90	0
4	60	33	150			243	0
5	70	40				110	0
6	70	40				110	0
7	80	40	150	50,000	50,000	270	100,000
8	100	40				140	0
9	100	40				140	0
10	100	40				140	0
11	100	40	150	50,000	50,000	290	100,000
12	100	50				150	0
13	110	50				160	0
14	110	50				160	0
15	110	50				160	0
16	150	50				200	0
17	150	50				200	0
18	150	50				200	0
19	107	50				157	0
20	100					100	0
Total	1,947	803	450	100,000	100,000	3,200	200,000

From this development schedule, we can assign the timing of the fiscal impacts. The first year of development, the fiscal impacts would be generated from 60 single family homes and 30 town houses. The fiscal impact per single family home and the fiscal impact per town house are both multiplied by 60 and 30, respectively, and added together to yield the fiscal impact in the first year. The same methodology is followed for each of the twenty years to determine the net impact up to that point in the development. The results of this are shown in Table V-2.

This also raises the issue of the timing of the impacts and the time value of money. If the impact fee is established based upon the full build out and occupancy of the development today, then the impact fee will not account for the time value of money. Because of inflation and consumer preferences, a dollar is worth more today than it will be at some point in the future. To say that a dollar is worth more today means that a consumer can purchase more with a dollar today than that consumer would be able to purchase with that same dollar at some point in the future. To account for this in the impact analysis, the net impacts on the City and Board of Education need to be valued according to when the development is expected to take place. The net impact for each year’s development has been adjusted for inflation, and the resulting summation of each year’s impact is the actual net impact that the City needs to prepare for. Accordingly, the impact fee needs to be assessed to recoup the additional costs in terms of what it will actually cost the City to provide services ten or twenty years from now when the development reaches its later stages. Table V-2 shows the inflated impacts assuming a constant level of annual inflation of 5% per year for the 20 year development period. The total resulting net negative impacts to the City and Board of Education budget are $445,499 and $1,775,915, respectively, for a total negative net impact over the 20 year development schedule of $2,221,414.

Introducing the time value of money into the analysis puts additional weight on the assumptions regarding the timing of development. In the full build out scenario the timing of development is inconsequential, but introducing the timing is critical to presenting a more realistic analysis. The figures discussed above are calculated under the assumption that the actual development occurs as scheduled. It is important to consider the effects of alternate timing scenarios. For example, if the commercial development is delayed, the positive net impacts would not affect the budgets until later, and the result would be the need for a higher impact fee to compensate for that. Additionally, when considering the timing of the impacts, the City needs to consider that the development schedule plans for residential development only in the first six years. This would create a greater than average net negative impact in the early years of development because the offsetting positive impacts from the non-residential development would not be realized until the seventh and eleventh years of planned development. This means that even with the impact fee, the City and Board of Education budgets could face negative impacts from the development.

SECTION VI – SUMMARY AND RECOMMENDATIONS

The fiscal impact analysis results suggest that the proposed development would have a net negative fiscal impact on the City of $188,183, and a net negative fiscal impact on the Board of Education of $789,993 for a total negative net fiscal impact of $978,176 for full build out and occupancy. After taking into consideration the time value of money, the City could levy an impact fee on the developer’s of the Hunt Field property of approximately $695 per residential unit in order to fund the additional expenditure burden that the development would bring the City over the 20 year development period. This figure is based on the net fiscal burden divided by the total number of proposed residential units (3,200). The resulting impact fee depends greatly on the assumed rate of inflation over the 20 year period. If annual inflation is as low as 3% the resulting impact fee would be approximately $500 per residential unit. Conversely, if the economy experiences higher inflation of 7% annually, the resulting impact fee would be approximately $970. The results also show that the residential development yields greater expenditure burden, and greater negative fiscal impact. In fact, the non-residential development would have a positive fiscal impact on the City budgets. This is not a surprising result. There is no expenditure burden on the Board of Education generated from non-residential development. The school age children grow as available housing grows, and that creates much greater expenditures generated from residential development.

This report recommends that an impact fee be charged to the developer of the Hunt Field property. The fee could be in the range of $700 in order to cover the increased operational expenditure requirements that would not be met by increased revenues. There are other considerations when levying an impact fee. First, many times the impact fee is simply passed on to the purchaser of the residential property. This is politically loaded decision, and for that reason the recommendation is with caution. The other key consideration when levying an impact fee is the possible reaction of the developer. The developer is likely not going to gracefully receive an increase in their costs of producing homes. It is possible that an impact fee that is set too high could raise significant enough concern on the part of the developer that they would change their development plans. In this case, the local government needs to weigh not only the fiscal burden of the city, but also the desired growth of the city.

That being said, there are also several compelling reasons to levy the impact fee. Development, by itself, is not sustainable without charging user’s fees or impact fees to allow the local government to provide the necessary services to the residential and non-residential community. Among the issues to consider when levying an impact fee is the great level of uncertainty involved in expected future revenues and expenditures. Market fluctuations could affect the property value and in the case of a decrease result in reducing the City’s and the Board of Education’s main source of revenue, property taxes. Unfortunately, this would not be coupled with the reduction in the cost to educate the students. It is important for a local government to be financially prepared to bear the burden of increased expenditures. Part of being prepared is levying appropriate impact fees on the new development that brings with it a net negative impact on the budget of the local government.

Another consideration in levying an impact fee is that the City is able to avoid burdening is existing residents with the costs of new development. In the absence of an impact fee, the fiscal burden would be shared between existing and potential taxpayers. That brings up the issue of whether it would be appropriate for existing residents to pay for the services necessary to accommodate new development.

The proposed impact fee in the range of $700 per residential unit rather modest in comparison to many cities that have impact fees totaling $3,000 to $4,000. Many cities with those high impact fees also leave much of the development burden to rest upon the remaining taxpayers. For the estimates produced in this report, the fiscal burden can be borne simply by the impact fee. Ultimately, the assessed fee should be tied to inflation, or flexible enough that it can be adjusted every several years, if necessary. This allows the City to manage increased expenditures as they occur, rather than remain fixed to a value that is partially dependent upon overall economic conditions.

APPENDIX A – DETAILED TABLES

1. Hunt Field Residential and Non-Residential data

2. Profile of General Demographic Characteristics

3. Employment and Industry Mix

4. Single Family Homes – Board of Education (Revenues and Expenditures)

5. Single Family Homes – City of Charles Town (Revenues and Expenditures)

6. Town Houses – Board of Education (Revenues and Expenditures)

7. Town Houses – City of Charles Town (Revenues and Expenditures)

8. Multi-Family Homes – Board of Education (Revenues and Expenditures)

9. Multi-Family Homes – City of Charles Town (Revenues and Expenditures)

10. Retail Commercial – Board of Education (Revenues); City (Rev and Exp)

11. Office Commercial – Board of Education (Revenues); City (Rev and Exp)

12. Real Property – City of Charles Town

13. Real Property – Board of Education

14. Personal Property – City of Charles Town

15. Personal Property – Board of Education

Hunt Field Residential and Non-Residential Data*

Residential

Type of Units	Units	Avg Real Estate Mkt Value	Gross Market Value	Assessed at 60% of Mkt Value	Estimated population	Estimated enrollment
Single Family	1,947	$ 200,000	$ 389,400,000	$ 233,640,000	5,354	1,441
Town House	803	$ 140,000	$ 112,420,000	$ 67,452,000	1,935	337
Apartment	450	$ 65,000	$ 29,250,000	$ 17,550,000	986	99
Total	3,200		$ 531,070,000	$ 318,642,000	8,275	1,877


Non-Residential

Type of Space	Total SF		Gross Market Value	Assessed at 60% of Mkt Value		Estimated Jobs**
Retail	100,000		$ 9,000,000	$ 5,400,000		308
Office	100,000		$ 11,000,000	$ 6,600,000		198
Total	200,000		$ 20,000,000	$ 12,000,000		506

* Data presented is taken from the developer's plans and estimations. Market values, population and enrollment estimates
are used throughout this impact assessment.
** The estimated jobs were performed by URS using the IMPLAN software.

Profile of General Demographic Characteristics - 2000 U.S. Census

	Jefferson County	Charles Town
Population	42,190	2,907
Median age	36.8	38.7
18 years or over	32,124	2,241

Households	16,165	1,285
Average HH size	2.54	2.26
Average Family size	2.99	2.95

Housing Units	17,623	1,411

School enrollment (3 yrs +)	10,289	678
Preschool	526	46
Kindergarten	513	32
Elementary (1-8)	4,685	347
High School (9-12)	2,206	156
College or above	2,359	97

Employment and Industry Mix - 2000 U.S. Census

	Jefferson County	Percentage	Charles Town	Percentage
Total Employment	21,581		1,427
Occupation
Management, Professional	7,215	33.43%	510	35.74%
Service	3,696	17.13%	331	23.20%
Sales and office	4,809	22.28%	276	19.34%
Farming, fishing, forestry	176	0.82%	18	1.26%
Construction, maintenance	2,789	12.92%	163	11.42%
Production, Transportation	2,896	13.42%	129	9.04%

Industry
Agric, fishing, forestry, hunting	557	2.58%	38	2.66%
Construction	2,367	10.97%	110	7.71%
Manufacturing	2,328	10.79%	116	8.13%
Wholesale Trade	363	1.68%	0	0.00%
Retail Trade	2,659	12.32%	123	8.62%
Transportation, utilities	813	3.77%	46	3.22%
Information	624	2.89%	39	2.73%
Finance, insurance, real estate	1,047	4.85%	66	4.63%
Professional, scientific, manag	2,031	9.41%	125	8.76%
Educational, health and soc serv	3,732	17.29%	300	21.02%
Arts, entertainment, food services	2,232	10.34%	249	17.45%
Other services	996	4.62%	70	4.91%
Public administration	1,832	8.49%	145	10.16%

Board of Education
Single Family Homes Fiscal Impacts

Number of Single Family Homes	1,947
Expected Population	5,354
Expected Enrollment	1,441


Revenues
Taxes	$ 2,726,579
Other local revenues	$ 192,415
State sources	$ 5,023,923
Federal sources	$ 540,727
Total Revenues	$ 8,483,644

Expenditures	$ 9,666,385

Net Impact	$ (1,182,741)

Net Impact Per Home	$ (607)

City of Charles Town
Single Family Homes Fiscal Impacts

Revenues
Taxes
Real & Personal Property Tax	$ 696,247
Business and occupation tax	$ -
Alcoholic beverages tax	$ 45,193
Utility services tax	$ 280,453
Hotel occupancy tax	$ 59,833
Other taxes	$ 2,370
Video lottery revenue	$ 50,747
Licenses and permits	$ 31,686
Franchise fees	$ -
Intergovernmental:
Federal	$ 135,599
State	$ 2,637
Charges for services	$ 90,261
Fines, forfeits, court costs and charges	$ 5,059
Other Revenues	$ 20,418
Total Revenues	$ 1,420,503

Expenditures
General government	$ 430,444
Public Safety	$ 893,977
Street and transportation	$ 327,096
Health and Sanitation	$ 650
Culture and recreation	$ 71,628
Total Expenditures	$ 1,723,795

Net Impact	$ (303,292)

Net Impact Per Home	$ (156)

Board of Education
Town House Fiscal Impacts

Number of Town Houses	803
Expected Population	1,935
Expected Enrollment	337


Revenues
Taxes	$ 826,523
Other local revenues	$ 69,541
State sources	$ 1,174,922
Federal sources	$ 126,457
Total Revenues	$ 2,197,443

Expenditures	$ 2,260,633

Net Impact	$ (63,190)

Net Impact Per Home	$ (79)

City of Charles Town
Town Houses Fiscal Impacts

Revenues
Taxes
Real & Personal Property Tax	$ 211,057
Business and occupation tax	$ -
Alcoholic beverages tax	$ 16,333
Utility services tax	$ 80,731
Hotel occupancy tax	$ 21,624
Other taxes	$ 857
Video lottery revenue	$ 18,341
Licenses and permits	$ 9,148
Franchise fees	$ -
Intergovernmental:
Federal	$ 49,007
State	$ 953
Charges for services	$ 32,621
Fines, forfeits, court costs and charges	$ 1,461
Other Revenues	$ 5,895
Total Revenues	$ 448,028

Expenditures
General government	$ 155,568
Public Safety	$ 323,094
Street and transportation	$ 118,216
Health and Sanitation	$ 235
Culture and recreation	$ 25,887
Total Expenditures	$ 623,000

Net Impact	$ (174,972)

Net Impact Per Home	$ (218)

Board of Education
Multi Family Homes Fiscal Impacts

Number of Multi Family Homes	450
Expected Population	986
Expected Enrollment	99


Revenues
Taxes	$ 422,221
Other local revenues	$ 35,435
State sources	$ 345,155
Federal sources	$ 37,149
Total Revenues	$ 839,960

Expenditures	$ 664,103

Net Impact	$ 175,857

Net Impact Per Home	$ 391

City of Charles Town
Multi Family Homes Fiscal Impacts

Revenues
Taxes
Real & Personal Property Tax	$ 107,816
Business and occupation tax	$ -
Alcoholic beverages tax	$ 8,323
Utility services tax	$ 21,426
Hotel occupancy tax	$ 11,019
Other taxes	$ 437
Video lottery revenue	$ 9,346
Licenses and permits	$ 965
Franchise fees	$ -
Intergovernmental:
Federal	$ 24,972
State	$ 486
Charges for services	$ 16,623
Fines, forfeits, court costs and charges	$ 153
Other Revenues	$ 622
Total Revenues	$ 202,187

Expenditures
General government	$ 79,271
Public Safety	$ 164,636
Street and transportation	$ 60,238
Health and Sanitation	$ 120
Culture and recreation	$ 13,191
Total Expenditures	$ 317,456

Net Impact	$ (115,270)

Net Impact Per Home	$ (256)

Board of Education
Retail Commercial Space Fiscal Impacts

Revenues
Taxes	$ 126,036

Expenditures	$ -

Net Impact	$ 126,036

City of Charles Town
Retail Commercial Space Fiscal Impacts

Revenues
Taxes
Real & Personal Property Tax	$ 32,184
Business and occupation tax	$ 28,259
Alcoholic beverages tax	$ 10,477
Utility services tax	$ 43,044
Hotel occupancy tax	$ 13,872
Other taxes	$ 550
Video lottery revenue	$ 11,169
Licenses and permits	$ 24,740
Franchise fees	$ 79,992
Intergovernmental:
Federal	$ 10,479
State	$ 204
Charges for services	$ 135
Fines, forfeits, court costs and charges	$ 380
Other Revenues	$ 1,534
Total Revenues	$ 257,018

Expenditures
General government	$ 4,156
Public Safety	$ 8,632
Street and transportation	$ 3,158
Health and Sanitation	$ 6
Culture and recreation	$ 692
Total Expenditures	$ 16,644

Net Impact	$ 240,374

Board of Education
Office Commercial Space Fiscal Impacts


Revenues
Taxes	$ 154,044

Expenditures	$ -

Net Impact	$ 154,044

City of Charles Town
Office Commercial Space Fiscal Impacts

Revenues
Taxes
Real & Personal Property Tax	$ 39,336
Business and occupation tax	$ 34,539
Alcoholic beverages tax	$ 12,806
Utility services tax	$ 52,609
Hotel occupancy tax	$ 16,954
Other taxes	$ 672
Video lottery revenue	$ 13,652
Licenses and permits	$ 262
Franchise fees	$ 846
Intergovernmental:
Federal	$ 12,808
State	$ 249
Charges for services	$ 165
Fines, forfeits, court costs and charges	$ 83
Other Revenues	$ 340
Total Revenues	$ 185,319

Expenditures
General government	$ 5,080
Public Safety	$ 10,550
Street and transportation	$ 3,860
Health and Sanitation	$ 8
Culture and recreation	$ 845
Total Expenditures	$ 20,343

Net Impact	$ 164,977

Expected Municipal Property Taxes on Hunt Field - City of Charles Town


Property Type	Units	Average Sales Price	Assessed Value	Rate/$100	Tax
Single Family Homes	1,947	$ 200,000	$ 120,000	0.2384	$ 556,998
Town Houses	803	$ 140,000	$ 84,000	0.2384	$ 160,806
Multi-Family Homes	450	$ 65,000	$ 39,000	0.4768	$ 83,678
Subtotal - Residential					$ 801,482

Non-Residential (Retail)	100,000 sq ft	$ 9,000,000	$ 5,400,000	0.4768	$ 25,747
Non-Residential (Office)	100,000 sq ft	$ 11,000,000	$ 6,600,000	0.4768	$ 31,469
Subtotal - Non-Residential					$ 57,216

Total City Portion					$ 858,698

Expected Municipal Property Taxes on Hunt Field – Board of Education


Property Type	Units	Average Sales Price	Assessed Value	Rate/$100	Tax
Single Family Homes	1,947	$ 200,000	$ 120,000
School Current Expense				0.4096	$ 956,989
School Excess Levy				0.4360	$ 1,018,670
School Per. Improvement				0.0880	$ 205,603
Town Houses	803	$ 140,000	$ 84,000
School Current Expense				0.4096	$ 276,283
School Excess Levy				0.4360	$ 294,091
School Per. Improvement				0.0880	$ 59,358
Multi-Family Homes	450	$ 65,000	$ 39,000
School Current Expense				0.8192	$ 143,770
School Excess Levy				0.8720	$ 153,036
School Per. Improvement				0.1760	$ 30,888
Subtotal - Residential					$ 3,138,689

Non-Residential (Retail)	100,000 sq ft	$ 9,000,000	$ 5,400,000
School Current Expense				0.8192	$ 44,237
School Excess Levy				0.8720	$ 47,088
School Per. Improvement				0.1760	$ 9,504
Non-Residential (Office)	100,000 sq ft	$ 11,000,000	$ 6,600,000
School Current Expense				0.8192	$ 54,067
School Excess Levy				0.8720	$ 57,552
School Per. Improvement				0.1760	$ 11,616
Subtotal - Non-Residential					$ 224,064

Total: Board of Education					$ 3,362,753

Expected Personal Property Taxes on Hunt Field - City of Charles Town


Personal Property Tax Category	Cars	Average Value	Assessed Value	Rate/$100	Tax
Single Family Homes
First Auto	1,947	$ 15,000	$ 9,000	0.4768	$ 83,550
Second Auto	1,947	$ 10,000	$ 6,000	0.4768	$ 55,700

Town Houses
First Auto	803	$ 13,125	$ 7,875	0.4768	$ 30,151
Second Auto	803	$ 8,750	$ 5,250	0.4768	$ 20,101

Multi-Family Homes
First Auto	450	$ 11,250	$ 6,750	0.4768	$ 14,483
Second Auto	450	$ 7,500	$ 4,500	0.4768	$ 9,655
Sub-Total Residential					$ 213,639

Non-Residential (Retail)	100,000 sq ft	$ 2,250,000	$ 1,350,000	0.4768	$ 6,437
Non-Residential (Office)	100,000 sq ft	$ 2,750,000	$ 1,650,000	0.4768	$ 7,867
Sub-Total Non-Residential					$ 14,304

Total City Portion					$ 227,943

Expected Personal Property Taxes on Hunt Field - Board of Education


Personal Property Tax Category	Cars	Average Value	Assessed Value	Rate/$100	Tax
Single Family Homes
First Auto	1,947	$ 15,000	$ 9,000	1.8672	$ 327,189
Second Auto	1,947	$ 10,000	$ 6,000	1.8672	$ 218,126

Town Houses
First Auto	803	$ 13,125	$ 7,875	1.8672	$ 118,075
Second Auto	803	$ 8,750	$ 5,250	1.8672	$ 78,716

Multi-Family Homes
First Auto	450	$ 11,250	$ 6,750	1.8672	$ 56,716
Second Auto	450	$ 7,500	$ 4,500	1.8672	$ 37,811
Sub-Total Residential					$ 836,634

Non-Residential (Retail)	100,000 sq ft	$ 2,250,000	$ 1,350,000	1.8672	$ 25,207
Non-Residential (Office)	100,000 sq ft	$ 2,750,000	$ 1,650,000	1.8672	$ 30,809
Sub-Total Non-Residential					$ 56,016

Total: Board of Education					$ 892,650

[1] The figures presented for expected population growth and student enrollment were produced by the developers and their growth forecasts are used in this analysis in order to maintain the same base data for the fiscal impacts of the project. The developers used student generation factors that are higher than the existing student generation rates for Jefferson County. This results in the development creating more students than an average development existing in the county, and creates higher expenditures. This is commendable that the developer is making an assumption that leads to higher expenditure requirements.

[2] Data on the Hunt Field plans are also presented in the appendix.

[3] This is because of the design of the output tables. The design of the output tables are a common format for all local governments, but not all local governments have exactly the same revenue categories. For example, most local governments do not receive income from video lottery revenue. This does not mean that the category is not considered when IMPLAN calculates impacts, but it is not reported directly. By using a data set specific to the local community, the specific local revenues will be accounted for and included in the total local tax impact.

[4] The figure in the table is slightly greater than $6,708 x 1,877 (= $12,590,916) due to rounding of these numbers. Rounding did not occur in the actual calculation, resulting in the slightly greater number in the table ($12,591,120).