Forbes gets the headline wrong here. Instead of "may be" it clearly is. Anyone who studies the issue and the numbers for more than a few days quickly understands that. Darren Dahl writes about the work of Joe Minicozzi of Urban Three:
Minicozzi’s work focuses on showing how most communities unintentionally subsidize suburban development because they don’t calculate the true cost of expanding infrastructure like water and sewage, and services like police and fire to the fringes of a community’s corporate boundary.
Some municipalities opt to make up the difference through new tax policies, but property tax increases are decidedly unpopular in most communities.
As an alternative, many communities turn to luring large retailers that offer the promise of jobs and additional sales tax, which they hope will plug the holes in their budgets. But when the cost of maintaining the infrastructure necessary to support these businesses isn’t offset by increased sales tax revenue, the situation can become even worse.
As a result, these communities can find themselves unable to pay for sprawl, despite growing populations and increasing demand.
Take the city of Asheville, North Carolina, where Minicozzi is based, as an example. The city, which has a population of about 83,000, realizes an astounding 1,000 percent greater return on downtown mixed-use development projects on a per acre basis compared to when ground is broken near the city limits for a sprawling retail center.
Put a different way: a typical mixed-use acre of downtown Asheville yields $150,000 more in annual tax revenue to the local government than an acre of strip malls or big-box stores.
“If you were a city facing a budget crisis, shouldn’t this serve as an eye-opener, both in terms of your policies and your development priorities?” asked Minicozzi.
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