On the Municipal Balance Sheet, Central Districts Look Good

Charles Marohn analyzes Lafayette, Louisiana for how well (or poorly) its districts measure up in terms of infrastructure investment versus tax revenues. The results are telling.
February 1, 2017, 2pm PST | Philip Rojc | @PhilipRojc
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Joseph Sohm

After a research effort to determine why the city of Lafayette can't "keep up" with its own maintenance, Charles Marohn gives us a telling visual. "When we finished, we had a three dimensional map showing what parts of the city generated more revenue than expense (in business terms, this would be called profit) and what parts of the city generated more expense than revenue (again, in business terms, this is considered a loss)."

The results back up Marohn's usual thesis: that wanton infrastructure investments in low-slung suburban areas will not pay for themselves. In the long term, they'll run up a deficit.

"There are some remarkable things to note right off the top. When we added up the replacement cost of all of the city's infrastructure -- an expense we would anticipate them cumulatively experiencing roughly once a generation -- it came to $32 billion. When we added up the entire tax base of the city, all of the private wealth sustained by that infrastructure, it came to just $16 billion. This is fatal."

For more, see Marohn's follow-up article, "Poor Neighborhoods Make the Best Investments."

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Published on Tuesday, January 10, 2017 in Strong Towns
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