Quote:
Originally Posted by SebC
Net subsidy: (NPV of expenditures by the city to service an area) > (NPV of taxes + fees paid by that area).
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Right there. It is not NPV inequality, but the FV comparison that you have to take, if you insist on making a feasibility analysis that is based on one isolated area. The FV of the permanent future cashflow increasing at the rate of 3-5% in perpetuity that needs to be higher than the pro-rated NPV of City's investment. Regardless, this approach is flawed to begin with. You cannot, ok, should not apply it on an isolated area. Elbow Valley, technically, fully paid for itself. It is a beautiful community. But that was a classic example of an urban sprawl - very low density subdivision that was allowed to hook up to City's services with no housing type diversity. A true community for the rich. By applying the same methodology, if, hypothetically, the City allows the entire new subdivision to be built in skinnies (single-family houses on the narrowest possible lots), the net difference would be positive in favour of the City (provided that there are no requirements to oversize utilities).
Re-read Bunk's post on acreage assessment breakdown. It is factual and it does represent the current political position and thinking of Mayor Nenshi and some of the inner-city aldermen well. Re-read my follow-up post. It is also factual, as it represents the fees that are not included in Bunk's calculation. When you add those up, the cost difference disappears.
This is a very complex issue, because it also involves the premise of who and how pays to support the growth and who and how benefits from it. Even your friends are telling you that you are talking about it from a very narrow and unsubstantiated angle. Either open up to counter-arguments or stop proselytizing.