06-08-2016 Workshop Packet - Laserfiche WebLink

Home Browse Search

4 4 8 Simons, Magner and Baku Cities with sales tax received the benefit of the sales tax collected on the construction materials sold that were used in the rehab project. This benefit totaled $31,493, or $248 per unit of output. Exhibit 5 summarizes the per-unit and total fiscal benefits for each type of benefit. Fiscal Benefit:Cost Analysis A benefit:cost analysis involves the calculation of present values for all costs and benefits over a stated period of time and compares the two in a ratio. The product of this analysis is the benefit:cost ratio, which indicates the amount of a cost needed to generate the corresponding benefit. For instance, a beneficcost ratio o 1:2 nicans that in order to generate one unit of benefit, two units of cost 111ust be used. This correslionds to a fiscal benefit of $0.54 per invested public doilar. The averaigge benefwcost r itio for the ten programs in this study was just uuntkwr 1:2. Only two progranis had benefit:cost ratios that were greater than one, '%Vhich would ivadicaater fiat suksidies could be; justified based solely on fiscal fitclors. Exhibit 6 shows the total costs and benefits for each of the ten case study programs. Another way to look at the benefit:cost ratio is to consider the city's return for every dollar spent. In the sample, the typical experience was that a dollar invested Exhibit 7 1 Return on Cities' Investment NWO Return on $1 Invested ($) Aberdeen 0.35 Barberton 0.80 Battle Creek 22.67 Kansas City, KS 0.43 LaGrange 0.29 Manchester 1.01 New Orleans 0.28 Phoenix 0.65 San Antonio 0.42 San Diego 0.77 Average (9) 0.56 Average (all 10) 2.77 Median (all 10) 0.54 Note: Because Battle Creek is so different from the others, an analysis was run with the remaining NWOs. ON