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4 3 6 Simons, Magner and Baku does not address the extent to which this policy expands the tax base compared to the cost of the subsidies. Simons and Sharkey (1997) performed a similar fiscal impact analysis measuring the fiscal impacts of subsidized new housing. They measured subsidies (costs) and benefits of ten new construction projects in Cleveland, Ohio. Their research considered both supply-side on -budget subsidies, such as cheap city land from the City of Cleveland's Land Bank, environmental remediation grants and infrastructure improvements. These items do not directly apply to this research because rehabs, having already passed beyond this part of the housing production process, do not generally require these inputs. The demand-side costs, however, such as property tax abatement and low-interest first and second mortgages, were considered as costs in this study. Fiscal benefits evaluated in the Simons and Sharkey study included new resident income tax, unabated property tax for the new units, increased property taxes from nearby homes positively affected by new housing construction and construction employee income tax (a one-time benefit). The authors found a benefit:cost ratio less than one, indicating that costs exceeded benefits. It should be noted that Cleveland's local municipal sales tax is allocated by state formula and is not counted as a fiscal benefit. Goetz, et al. (1997) reported on the fiscal impacts of the Houses to Homes program' in St. Paul, Minnesota. The unpublished report chronicles the activities of the program since its inception in 1991, and performs a fiscal benefit:cost analysis of the program. While Goetz's report falls short in some respects (i.e., assuming linear marginal costs for police services), it does consider an important phenomenon that was not included in the Simons and Sharkey (1997) article. Goetz measures the impact of rehab houses in the Houses to Homes program on nearby property investment. The study used proximity to rehabbed units and building permits to measure the impact of rehabbed units on the neighbor's decision to invest in his or her home. Investment amount was translated into increased assessment, and then into increased property taxes for the city. In addition to a void on the fiscal impacts of housing rehabilitation, articles directly addressing their economic impact are also absent from the literature. Johnson and Harter (1998) addressed the impacts on the local economy of a hypothetical family leaving public housing and moving into Section 8 housing. Although this scenario does not directly relate to the impact of rehabilitated housing, some of their methodologies for measuring economic impacts have been utilized for this analysis. The National Association of Home Builders (NAHB) publishes indices that indicate the economic impact of new construction at the local, state and national level. However, the national organization does not do the same for rehabilitated housing investment. Some NAHB definitions are adapted here, for example the threshold for a substantial rehabilitation in dollar and percentage terms, in performing the analysis. 16