"Maybe it would be cheaper to just buy the land and turn it into a park", a comment heard more and more often when discussing the prospect of annexing more property into a city.

The City of Florence is proposing annexation of four parcels (total 211.64 acres) in order to accommodate developers' concerns about the availability of land for "growth".  It's a $19.2 million decision, and the city doesn't even realize how much it will cost taxpayers.

I wrote an article about expansion of Urban Growth Boundaries last year, and unfortunately, much of the same information still applies.  The city of Florence is proposing to annex 211.64 acres. You would think that annexations would be a good thing: more people means more taxes collected,  means more money in government coffers to provide needed services.  You might also expect that the property taxes are set at a level that would ensure that developers are paying their fair share - that any increase in need for government services (roads, schools, water supply) would be offset by increased taxes.

Apparently, this isn't so, says Eben Fodor in his "Cost of Growth in Oregon: 1998", a statistical analysis of the cost of growth to communities.  Fodor’s analysis shows a net cost to existing residents of  $33,260 for every new home that is built in the community.  Florence’s year 2020 population projections use a figure of 2.04 people per home, and 4.84 homes per acre.  Using those figures, the total number of new homes that could be expected in the 211.64 acres would be 1,024.  The proposed zoning and development plans for these parcels, however, point to a lower density - just 782 more homes.  Under current city rates, each home could be expected to pay about $3,950 in systems enlargement fees, which would leave a net cost of $29,310 per home.  Based on Fodor’s statewide figures, the total cost of increasing the size of the city by 211.64 acres - $22.9 million. Now, I’m not a statistical wizard, but I thought that seemed a bit much.  So I tried adjusting the figures to more fully reflect the small community where I live, Florence, population 7,263.

Most newcomers to Florence are retired.  About 10% of the proposed expansion is around a golf
course, and locals suspect some of the proposed development will be senior citizen oriented
(gated communities, seniors only, etc.).  So there probably would be less impact on the schools -
discounting the $11,809 allocated to school costs by 50% equals $5,904.

Sewer system costs are a whole other matter here in Florence.  We’ve just built a new sewer
plant designed to take care of 12,000 people.   The new plant was supposed to last until the year
2020, but recent population projections indicate we may have to upgrade by the year 2015 if the
annexations are allowed.  Put another way, the proposed annexations will cut five years off the
life of our sewage treatment plant.  The cost for the original improvement was spread out over 20
years and some of that cost will be paid by newcomers through systems enlargement fees.
Unfortunately, those fees seldom, if ever, cover the whole cost of the enlargement necessitated by
new growth.  No discount to the $1,660 allotted to sewer system costs.

Next comes costs of building new roads to serve the new areas - $4,430.  158 of the  acres would
be served by a small, two lane County road.  If that area of Florence is brought into the city, it
will be the city’s responsibility to upgrade the road to accommodate the increase in growth.  81.1
acres of the annexation will also require a new road to access.   More people will also mean we
need wider roads, new curbs, drainage, lighting, signage and traffic signals inside the city.  No
discount there.

Now on to water services - $2,729 per house.  Right now, Florence is holding its own during the
summer.  About one-third of its water is purchased from a neighboring water district.  The City is
planning to build a new water well system, which is projected to cost $12 million over the next
20 years - in order to accommodate the new growth.  The City is negotiating with a neighboring
water district to supply most water to 134 of the acres, but even that stop-gap solution brings its
own problems.  The water district has recently been restricted to one million gallons per day by
Lane County. The water district’s ability to provide water depends on obtaining special
permission from the county in order to increase its water production.  Other private influences
may also interfere with the water district’s ability to produce more water.  If the water district is
unable to increase its production, the addition of the new parcels will force the city to begin
building the new $12 million water system about five years earlier than planned. No discount
there.

Parks  - $2,915 per house.  Our parks are projected to be insufficient for the size of our
community by the year 2020.  The argument could be made that retired folks don’t use the parks
all that much, and maybe we’ll be able to get by with the existing parks we have - especially
considering there are so many state and federal forest lands in the area.  Deduct that cost from the
estimate.

Stormwater Drainage - $483.  Most of the land proposed for inclusion is in the northeast area of
Florence - an area that is infamous for its stormwater flooding problems.  The city is working on
a city-wide stormwater management system.  You can bet that’s going to be a big item in the
city’s budget.  The city would be responsible for dealing with more acres of stormwater
problems, and would in fact be exacerbating the problem by encouraging development in
historically recognized wetlands and stormwater retention areas.  $483 seems extremely
reasonable, perhaps even charitable under the circumstances.

Expanded library and fire protection facilities - $441.  The library is in pretty good shape right
now, but again, the increased retirement population can be expected to put more of a strain on
services than do working families, so that seems to be a legitimate cost.

Fire protection services - $298 - have been delegated to the rural fire department, but an increase
in the city’s share of the service area will no doubt be reflected in an increase in service rates to
the City.  No discounts there.

Last, but not least, electric power and distribution costs - $8,494.  Since the local public utility
district takes care of that, it would be very easy to simply ignore the costs.  But each rate payer
living in the city will be paying their share of the net costs associated with the PUD’s additional
equipment needed to serve more people.  Without the city encouraging more houses in the 211
acres, the existing power facilities would be sufficient to serve existing city rate payers.  No
discount.

That leaves us with a locally-adjusted cost to the taxpayers of Florence of $24,439 per house.
Net cost to existing taxpayers of annexing 211 acres to the city: $19,284,298.

One comment often comes up in conversation - all those new people will also be paying city
property taxes, so they really will be paying their fair share.  The only problem with that
statement is that property taxes only pay for “operation and maintenance” of existing government
services, including increased staffing needed, etc.  The $19.2 million cost to the residents of
Florence only deals with “capital” costs - like adding another wing to the library, buying another
fire truck, or adding another well to produce drinking water.

Bottom line - local governments need to check out their own bottom line before they encourage
annexation.

Debby Todd

Ms. Todd has lived in Florence since 1986, and has participated in many community activities.
She is employed as a paralegal, and contributes many of her spare hours to improving the
livability of Florence.