Custer report says rural subdivisions don’t pay

Brief by Central Staff

Growth – April 2000 – Colorado Central Magazine

Does residential development pay in rural areas?

Not in Custer County, according to a study conducted by the San Isabel Foundation, the Custer Heritage Committee, the Sonoran Institute, and the American Farmland Trust.

They analyzed data from 1998, and came to these conclusions in their Cost of Community Services survey:

— For every dollar that local governments receive in taxes from agricultural land, they spend only 54¢ in providing services to those lands.

— For every dollar that they receive from commercial and industrial property, they spend 71¢ on services.

— For ever dollar from residential development, they spend $1.16 on services.

In other words, if the study is correct, then every resident subsidizes rural subdivisions, which cost more in services than they produce in taxes.

The study said that a typical 160-acre hay meadow in Custer County would pay $540 in annual taxes while demanding only $290 in governmental services. A subdivision the same size would generate about $21,000 in annual taxes, but at a cost of $23,000 in services.

According to the summary, “the bottom line is that instead of expanding the tax base, residential development that is not balanced by business growth and agricultural preservation will either increase property taxes or result in declining levels of public services.”

We’ve seen only the summary; we asked for a copy of the full report, but by the time we asked, they were all gone and some new ones were being printed.

So, we hope to publish more in the future — and persuade ourselves to be skeptical about a report that so confirms our own beliefs about residential-acreage developments in this part of the world.