The county impact of home building in the city of roseburg oregon
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THE COUNTY IMPACT OF HOME BUILDING IN THE CITY OF ROSEBURG, OREGON. Presented by : Elliot F. Eisenberg, Ph.D . October 2, 2009 Roseburg, OR. LOCAL ECONOMIC IMPACT. Construction phase Jobs Materials Local fees, taxes, contributions Ripple or feed-back from construction

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THE COUNTY IMPACT OF HOME BUILDING IN THE CITY OF ROSEBURG, OREGON

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The county impact of home building in the city of roseburg oregon

THE COUNTY IMPACT OF HOME BUILDING IN THE CITY OF ROSEBURG, OREGON

Presented by:

Elliot F. Eisenberg, Ph.D.

October 2, 2009

Roseburg, OR


Local economic impact

LOCAL ECONOMIC IMPACT

  • Construction phase

    • Jobs

    • Materials

    • Local fees, taxes, contributions

  • Ripple or feed-back from construction

    • Wages spent in local economy

  • Occupancy phase

    • Earnings spent in local economy


The county impact of home building in the city of roseburg oregon

  • The model does not say build housing to stimulate the local economy

  • Rather, it is job creation that results in increased demand for housing, but remember that…..

HOUSING => JOBS


The county impact of home building in the city of roseburg oregon

CONSTRUCTION PHASE

$$ VALUE OF CONSTRUCTION $$

SERVICES PROVIDED AT CLOSING

PERMIT/HOOK-UP FEES

$ $ $ $ $

(Obtained from Local Sources)

INPUTS:

MODEL OF THE LOCAL ECONOMY

INCOME FOR LOCAL RESIDENTS

&

TAX/FEE REVENUE

FOR LOCAL GOVERNMENTS

OUTPUTS:


The county impact of home building in the city of roseburg oregon

RIPPLE PHASE

LOCAL INCOME & TAXES

FROM PHASE 1

INPUTS:

SPENDING ON

LOCAL GOODS & SERVICES

Consumer Expenditure Survey

(U.S. Bureau of Labor Statistics)

MODEL OF THE LOCAL ECONOMY

OUTPUTS:

LOCAL INCOME & TAXES


The county impact of home building in the city of roseburg oregon

OCCUPANCY PHASE

INCOME OF HOUSEHOLD

OCCUPYING NEW HOUSING UNIT

INPUTS:

SPENDING ON

LOCAL GOODS & SERVICES

PROPERTY TAX PAYMENTS

MODEL OF THE LOCAL ECONOMY

OUTPUTS:

LOCAL INCOME & TAXES


Douglas county or

Douglas County, OR


The county impact of home building in the city of roseburg oregon

The Douglas Co., OR Multiplier

Only Captures

Spending that Stays in the County

Includes:

Banking, Car Repair, Dry Cleaning, Day Care Services, Dental Services, Electricity, Landscaping, Legal Services, Manicures, Medical Services, Newspaper Delivery, Restaurants and Psychiatric Care.

But Not:

Auto Manufacturing, Beer Bottling, Mattress Manufacturing, Meat Packing, Movie Production, and Travel Agency Services


History of the model

History of the Model

  • Over 600 Economic Impact Analyses Performed

  • Users of the Model Include:

  • Boone County Kentucky

  • Habitat for Humanity, International

  • MI State Housing Development Authority

  • Michigan State University

  • Missouri Housing Development Commission

  • University of Florida

  • University of Massachusetts

  • University of Montana

  • West Virginia Housing Development Fund…


Assumptions of the model

Assumptions of the Model

Inputs To ModelSingle Family

Average house price: $268,882

Average raw lot cost: $7,735

Permits/Infrastructure: $8,545

Annual prop. taxes: $2,455


Economic impact of single family home building

Economic Impact of Single Family Home Building

  • 1st - Construction phase

  • 2nd - Ripple effect from construction phase

  • 3rd - Occupancy phase

  • 4th - Ten year total


The county impact of home building in the city of roseburg oregon

FIRST YEAR IMPACT: SF Construction

Every 100 SF Homes

INCLUDING:

184 Jobs in Construction

40 Jobs in Wholesale & Retail Trade

21 Jobs in Business and Professional Services


The county impact of home building in the city of roseburg oregon

FIRST YEAR IMPACT: SF Ripple

INCLUDING:

36 Jobs in Wholesale and Retail Trade

22 Jobs in Health, Education & Social Services

18 Jobs in Eating and Drinking Places


The county impact of home building in the city of roseburg oregon

ONGOING SF ANNUAL EFFECT

INCLUDING:

16 Jobs in Wholesale and Retail Trade

9 Jobs in Health, Education & Social Services

8 Jobs in Eating and Drinking Places


The county impact of home building in the city of roseburg oregon

Total SF Impact: First Ten Years

Along with 401 temporary jobs

And 59 permanent ones!


Largest local private employers

Largest Local Private Employers

Employer# of FT Jobs

Roseburg Forest Products 2,500

Mercy Healthcare, Inc. 1,100

Seven Feathers Hotel & Casino Resort 735

Swanson Group, Inc. 429

Wal-Mart Stores, Inc. 281

New SF Residential Construction 266

First Call Resolution 237

Ingram Book Company 210

Orenco Systems, Inc. 207

Fred Meyer 186


The county impact of home building in the city of roseburg oregon

BUT

NEW HOMES REQUIRE:

INFRASTRUCTURE

  • Fire and police protection

  • Garbage collection

  • Parks and recreational opportunities

  • Roads

  • Correctional facilities

  • Primary and secondary education

  • Etc…


The county impact of home building in the city of roseburg oregon

Required Current Expenses per SF Unit


The county impact of home building in the city of roseburg oregon

Required Capital per SF Unit


The county impact of home building in the city of roseburg oregon

Now that we know:

The benefits of construction

&

The costs of construction

Does new construction pay for itself?


The county impact of home building in the city of roseburg oregon

Yes it does!

For every 100 SF units--

  • By the end of the 10th year the debt is fully paid off

  • By the 2nd year economic impacts offset fiscal costs

  • In the 10th year, net is $103,761 and is $105,517 thereafter


The county impact of home building in the city of roseburg oregon

Over 15 years, every 100 SF units generate a cumulative $8.2 million in revenue for local governments—but only $7.6 million in costs


What does 10 years mean

What does 10 years mean?

  • That is, should it be done faster, or is it O.K.?

  • Big purchases take time to pay off.

  • Car loans now last 5 years, and many lease!

  • How fast did you pay off your student loans?

  • How fast are your kids paying off theirs?

  • Did you pay off your home in 10 years?


Almost done just a bit more

Almost done, just a bit more


How large are non property tax revenues

How Large Are Non Property Tax Revenues

  • Single family property taxes are $2,545/unit per year but, yearly revenue is $4,645/unit per year, which is 83% more.

  • Clearly, property taxes are not the whole story!


A closer look at primary and secondary education

A Closer Look at Primary and Secondary Education

  • 12.6% attend private schools nationally

  • 1.7% are Home schooled nationally

  • 0.4 school age children/MF unit nationally

  • 0.6 school age children/SF unit nationally

  • OR State aid is $112 million or 74% of budget


The county impact of home building in the city of roseburg oregon

ANY QUESTIONS?

  • Elliot F. Eisenberg, Ph.D.

  • Call: 202.266.8398

  • Fax: 202.266.8426

  • [email protected]

  • 1201 15th Street NW

  • Washington, DC 20005-2800

  • Thank you very much!


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