General Background and Description of the Project
 

Setting Up A Fiscal Impact Study

 

The study will be of two versions of the project, the original plan and the revised plan. The Blackhawk Ranch was actually developed according to a third plan, but this will not be covered in the analysis.

The analysis will be limited to the impact upon the school district, the water district, the waste water district, and the fire protection district.

The study will include the impacts on the property, the local share of the sales tax, the property transfer tax, the hookup fees for the water and waste water districts and a category of miscellaneous taxes.

Fundamental assumptions:

• 1. That the residents of the project would not locate at an alternate location in Contra Costa County.
• 2. That the quality of service levels will be maintained so the impact of the project will be entirely in financial form rather than partly financial and partly as a deterioration in the quality of service.

Table 7: Demographic Ratios for Housing Comparable to the Proposed Housing in the Blackhawk Ranch Project

Fire Protection
 

The Blackhawk Ranch is served by the Danville Fire Protection District (DFPD). The DFPD had at the time of the project three fire stations with a work force of 42 to serve 50 square miles and a population of 29,000. The District Fire Chief felt that providing fire protection for the Blackhawk Ranch would require two additional fire stations and four compnies of firefighters. A company of firefighters in the DFPD is comprised of three firefighters. The operating costs of the firestations is about $21,100 per firefighter which covers salary and benefits and other costs for the station.

The capital cost of a firestation include $50,000 for the building, $70,000 for the equipment and $7,500 for the half acre of land required.

The DFPD is financed by revenue from the property tax. At the time of the project the tax rate for the fire district was $1.05 per $100 of assessed valuation.

Water Supply
 

The Blackhawk Ranch project is served by the East Bay Municipal Utility District, popularly known as East Bay MUD. The water supply for the project requires facilties for pumping, storage and transmission. These facilities have to be provided by East Bay MUD. The project also requies connecting lines in the project area, hydrants and service installation. These latter have to be provided by the developer.

The capacity of the storage facilities required for the project is based upon the water district needing 2,400 gallons of storage for each housing unit. The water district's capital cost are estimated as requiring 11 million gallons of storage capaicity requiring the following components:

Table 8: Capital Costs for Water District

The operating costs of the water district are believed to be exactly covered by the users fees paid. In 1979 the Water Utility District charged on the basis of the following scheme. For each customer there was a monthly service charge of $2.60. The first five 100 cubic feet units were charged at $0.38 per unit. For use beyond 500 cubic feet in a month each 100 cubic feet unit cost $0.50.

Sewer Service
 

The Blackhawk Ranch project would be served by the Central Contra Costa Sanitary District. The district would have to increase its capacity to handle the additional sewage load generated by the project. It was estimated that there would have to be $117 of capital investment per person in the project. This is based upon an estimate of 150 gallons of sewage water per person generated each day and a capital cost of $0.78 per gallon of daily capacity. Thus the sewage treatment requires one day's storage to handle its ongoing operations. The capital cost for sewer services can be computed by multiplying the above per person cost of $117 times the increase in population. This is a one-time cost. An alternate procedure would be to multiply for each housing type the average household size times the $117 figure. This gives the capital cost per housing unit of each type. The capital costs for sewage treatment would then be computed by multiplying the number of each housing units built in a year times the capital cost per unit and summing the results.

The missing information is the unit size of an increment in sewage storage capacity; i.e., when the sewage treatment district builds additional capacity what is the size of the unit built. Most likely there is some minimum efficient size for a unit but that information is not currently available.

The Sanitary District receives revenue from housing project from user fees which are computed for each household on the basis of its water use. Thus when a household uses water for watering a lawn it pays a sewer charge even though no sewage is generated.

Police Protection
 

Since the Blackhawk Ranch is not an incorporated city the police services are provided by the Contra Costa County Sheriff's Department. There is not an explicit charge for this service for the residents but the Sheriff's Department will necessarily incur additional costs if it maintains the same quality of service that it has provided to the rest of its service area. Some notion of the magnitude of these costs can be obtained by looking a the situation of the city of Layfayette. Lafayette is an incorporated city but it contracts with the Sheriff's Department to provide police protection. Lafayette pays the Sheriff's Department $303,000 per year for this service. To provide police services to Lafayette, a city of about 21,000 people, the Sheriff's Department assigns nine patrolmen and one detective to the city and operateas two patrol cars there such that any time of the day or night there is at least one patrol car operating in Lafayette.

Roads and Streets
 

The most problematical impact of the Blackhawk Ranch project is on traffic volume and the necessity to improve some of the roads serving the area to avoid a negative impact on the other residents who use the same roads. The division of responsibility for road maintenance and improvements between the State Government in Sacramento and the local governments and between city and county governments is not definite and clearcut. Often the division of financial responsibility has to be handled and decided by negotiation.

There are $8,775,000 in road improvements that might be considered as "attributable" to the project.

Preliminary List of Columns
for a Fiscal Impact Analysis of the Blackhawk Ranch Project
 

• 1. Year 0 to 30
• 2. No. of Estate Homes Constructed in Year
• 3. No. of Single Family Homes Constructed FROM REVISED PLAN
• 4. No. of Condominiums Constructed in Year
• 5. No. of Apartments Constructed in Year
• 6. Cumulative No. of Estates
• 7. Cumulative No. of Single Family Homes
• 8. Cumulative No. of Condominiums
• 9. Cumulative No. of Apartments
• 10. Market Value of All Housing (based on values in Table 3)
• 11. Property Tax (use tax rate of 1%)
• 12. Discount Factor (use interest rate of 5%)
• 13. No. of Preschool Children (use demographic ratios in Table 4)
• 14. No. of Elementary School (Kindergarten - 5th Grade) Children
• 15. No. of Junior High School (6th - 8th Grade) Children
• 16. No. of High School (9th - 12th) Grade Students
• 17. Total Population
• 18. No. of Elementary Schools needed (200 pupils per school)
• 19. No. of Junior High Schools needed (400 pupils per school)
• 20. No. of High Schools needed (500 pupils per school)
• 21. No. of Elementary Schools to be built (200 pupils per school)
• 22. No. of Junior High Schools to be built(400 pupils per school)
• 23. No. of High Schools to be built (500 pupils per school)
• 24. Construction Cost of Schools (paid at the beginning of year)
• 25. Operating Cost of Schools
• 26. State Grant to Schools
• 27. No. of Fire Stations to be Built
• 28. Cost of Fire Station Construction (beginning of the year)
• 29. Operating Cost of Fire Stations
• 30. Quantity of Water Used Per Year (200 gallons/household/day)
• 31. Operating Cost of Water Treatment Facilities
• 32. Construction Cost of Additional Water Treatment Facilities
• 33. User Fees for Water District
• 34. Hookup Fees for Water District
• 35. Operating Cost of Waste Water Facilities
• 36. Construction Cost of Additional Waste Water Facilities
• 37. User Fees for Sewer District
• 38. Hookup Fees for Sewer District
• 39. Income of Blackhawk Residents
• 40. Sales Tax Revenue Attributable to Blackhawk Project
• 41. Property Transfer Tax
• 42. Miscellaneous Taxes from Blackhawk Project
• 43. Total Revenue
• 44. Present Value of Revenue
• 45. Total Cost
• 46. Present Value of Costs
• 47. Net Revenue
• 48. Present Value of Net Revenue

Notes on the Blackhawk Ranch development from Bernard Frieden's The Environmental Protection Hustle.
 

Frieden's book examines the case histories of six large housing developments for middle income housing in the San Francisco Bay Area. In each case he found that the developers were forced to rescind plans for building thousands of housing units for middle income families and replace them with projects for building hundreds of units for high income families. The title of his book reflects his disgruntlement over seeing people from high income families use environmental arguments to increase the supply of housing for high income families at the expense of the supply of housing for middle income families. He sees the environmentalism as a ploy to protect the interests of one population group at the expense of others. Frieden's chapter on the Blackhawk Ranch is entitled, "Abusing Technical Studies." A major project such as the development of the Blackhawk Ranch requires the submission of an Environmental Impact Study as mandated by the State of California. Economic and fiscal impacts are considered important aspects of the environmental impact. These studies are usually prepared by professional consultants but the local government requires the developer to finance the studies. Frieden states,

Opponents began to organize early; thus the technical studies were prepared in the atmosphere of a gathering storm. The consultants, however, submitted balanced technical reports indicating that the environmental and fiscal consequences of the Blackhawk Ranch development would pose few serious problems for the county. The planning department, which had final responsibility for the studies, promptly rewrote them in ways that would provoke much greater opposition.

The planning department of Contra Costa County presented the rewritten version of the fiscal impact analysis to the County Board of Supervisors. At this public meeting the head of the consulting firm that prepared the study, Claude Gruen, announced that the results being presented by the planning department were not the conclusions of his firm's study. The rather strange ambiance of the meeting is perhaps revealed in the fact just before Dr. Gruen started to speak a young lady ran naked across the stage. Unflapped Dr. Gruen said, "Usually I cannot arrange such a spectacular introduction." The type of analysis that he found objectionable in the planning department study was the allocation of a pro rata share of fixed costs for the county to the Blackhawk Ranch. Generally the planning department staff who called themselves "planning economists" made mistakes that no economist would make. The technical environmental impacts were also the subject of controversy. Frieden notes, "Two separate consulting studies failed to find any rare or endangered plant species on the site." The planning department then asserted that although no rare or endangered species were discovered the development of the Blackhawk Ranch "would essentially preclude the discovery of any rare or endangered species." Searching for environmentalist handles to hold back the project the county planning department's report "worried" about a variety of plant and animal species including the Californian tiger salamander, the Alameda striped racer (a snake), and the black-chinned sparrow. Most are neither rare nor endangered and none have a habitat in the part of the project, a working ranch, that was to be developed. These species live in the chaparral that is on the higher slopes and would not be affected by the project. The planning department even worried about the coyote which they felt was unjustly maligned. But for these worries to elicit public support they have to involve creatures which are in some sense sacred. The consultants' reports emphasized that the development would have only minor impact on wildlife in the area since that areas in which the wildlife lived were not the parts of Blackhawk Ranch that would be developed. The consultants report argued that the golf courses called for in the developer's plans would, in fact, improve the habitat for deer and songbirds. Frieden says, Deer and songbirds, however, had no place in the gloomier visions foreseen by the county planning staff. They rewrote the text to argue that a residential development would 'create habitats for noxious animals or even animals dangerous to man.'[...] The apocalyptic vision of the county planning staff even included a vague threat to the well-being of our national bird, the bald eagle. Here, the reasoning was particularly tortured. The bald eagle has forty known nesting areas in California, none of them in Contra Costa County. The eagles have feeding areas away from their nests, but apparently there are no feeding areas for them on the property either. But the more northern populations of bald eagles do migrate to several lakes in California in the winter season and 'it is a possibility that they fly over the project area.' The crucial concern for many was not the environmental impacts but the fiscal impacts.