1 / 33

THE LOCAL AREA IMPACT OF HOME BUILDING IN WILLIAMS, COUNTY NORTH DAKOTA

THE LOCAL AREA IMPACT OF HOME BUILDING IN WILLIAMS, COUNTY NORTH DAKOTA . Presented by : Elliot F. Eisenberg, Ph.D . September 25, 2012 Williston, ND. LOCAL ECONOMIC IMPACT. Construction phase Jobs Materials Local fees, taxes, contributions Ripple or feed-back from construction

ronat
Download Presentation

THE LOCAL AREA IMPACT OF HOME BUILDING IN WILLIAMS, COUNTY NORTH DAKOTA

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. THE LOCAL AREA IMPACT OF HOME BUILDING IN WILLIAMS, COUNTY NORTH DAKOTA Presented by: Elliot F. Eisenberg, Ph.D. September 25, 2012 Williston, ND

  2. 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

  3. 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

  4. 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:

  5. 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

  6. 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

  7. The Williston, ND MSA

  8. The Williston, ND Multiplier Only Captures Spending that Stays in the MSA 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

  9. History of the Model • Over 700 Economic Impact Analyses Performed • Users of the Model Include: • Boone County Kentucky • Enterprise Foundation • 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…

  10. Assumptions of the Model Inputs To ModelSingle FamilyMultifamily Average house price: $275,000 $150,000 Average raw lot cost: $6,000 $2,500 Permits/Infrastructure: $2,000 $600 Annual property taxes: $4,098 $2,235

  11. Economic Impact of Single Family Home Building • 1st - Construction phase • 2nd - Ripple effect from construction phase • 3rd - Occupancy phase • 4th - Ten year total

  12. FIRST YEAR IMPACT: SF Construction Every 534 SF Homes INCLUDING: 483 Jobs in Construction 105 Jobs in Wholesale & Retail Trade 55 Jobs in Business and Professional Services

  13. FIRST YEAR IMPACT: SF Ripple INCLUDING: 93 Jobs in Wholesale and Retail Trade 56 Jobs in Health, Education and Social Services 47 Jobs in Eating and Drinking Places

  14. ONGOING SF ANNUAL EFFECT INCLUDING: 59 Jobs in Wholesale and Retail Trade 32 Jobs in Health, Education & Social Services 30 Jobs in Eating and Drinking Places

  15. Total SF Impact: First Ten Years Along with 1,038 temporary jobs And 218 permanent ones!

  16. FIRST YEAR IMPACT: MF Construction Every 970 MF Homes INCLUDING: 477 Jobs in Construction 102 Jobs in Wholesale & Retail Trade 53 Jobs in Business and Professional Services

  17. FIRST YEAR IMPACT: MF Ripple INCLUDING: 90 Jobs in Wholesale and Retail Trade 54 Jobs in Health, Education & Social Services 45 Jobs in Eating and Drinking Places

  18. ONGOING MF ANNUAL EFFECT INCLUDING: 85 Jobs in Wholesale and Retail Trade 48 Jobs in Eating and Drinking Places 39 Jobs in Health, Education & Social Services

  19. Total MF Impact: First Ten Years Along with 1,011 temporary jobs And 293 permanent ones!

  20. Largest Local Private Employers Employer# of FT Jobs Halliburton 1,850 Nabors 1,750 New SF/MF Residential Construction (534 SF/970 MF) 1,383 Key Energy 550 Schlumberger 550 Mercy Hospital 475 School District One 425 Sanjel 375 Wal-Mart 350 Pioneer Drilling 260 Bethel Lutheran 250 City of Williston 180

  21. BUT NEW HOMES REQUIRE: INFRASTRUCTURE • Fire and police protection • Garbage collection • Parks and recreational opportunities • Roads • Correctional facilities • Primary and secondary education • Etc…

  22. Required Current Expenses per SF Unit

  23. Required Capital per SF Unit

  24. Required Current Expenses per MF Unit

  25. Required Capital per MF Unit

  26. Now that we know: The benefits of construction & The costs of construction Does new construction pay for itself?

  27. Yes it does! For every 534 SF and 970 MF units-- • By the end of the 4th year the debt is fully paid off • By the 2nd year economic impacts offset fiscal costs • In the 4th year, net is $5,079,200 and is $5,108,700 thereafter

  28. Over 15 years, every 534 SF and 970 MF units generate a cumulative $141.2 million in revenue for local governments—but only $80.7 million in costs

  29. What does 4 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 4 years?

  30. Almost done, just a bit more

  31. How Large Are Non Property Tax Revenues • Single family property taxes are $4,098/unit per year but, yearly revenue is $7,752/unit per year, which is 89% more. • Multifamily property taxes are $2,235/unit per year but, yearly revenue is $4,961/unit per year, which is 120% more. • Clearly, property taxes are not the whole story!

  32. 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 • ND state aid is $15 million or 53% of budget

  33. ANY QUESTIONS? • Elliot F. Eisenberg, Ph.D. • Cell: 202.306.2731 • eeisenberg@nahb.org • 1201 15th Street NW • Washington, DC 20005-2800 • Thank you very much!

More Related