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Economic Studies

Here is a brief description of the results of six economic studies that have been conducted by Florida Stewardship Foundation and related organizations (including Florida Stewardship Foundation's successor, Stewardship America).  For information on how you can order full copies of these studies -- plus a video describing the results of the Hillsborough County study -- go to the Publications Page.

| Summary of Results | 
| How a Master-Planned Community can Generate a Surplus (PDF document) |
| Collier County | Hillsborough County | Lake County | Palm Beach County | Polk County |

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This study was initiated in August, 1994. It was conducted by Farming for the Future on behalf on American Farmland Trust to satisfy a contractual agreement between AFT and Palm Beach County.  (Farming for the Future has since become a part of Stewardship America, Inc.)

The first section of the study -- which focuses on the county's 20,000-acre Agricultural Reserve -- was completed three months later in November 1994 and presented by Farming for the Future President Craig Evans in a public meeting to the Board of County Commissioners.

The study gathered county, state and federal data, plus detailed information from the county's Planning, Zoning and Building Department on a proposed mixed-use development that would accommodate 25,880 homes and 485 acres of commercial/industrial development. It calculated:

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The long-term costs and/or benefits that would accrue to taxpayers as a result of a plan to spend $140 million to purchase development rights from landowners. The intent of this plan was to keep the area available for agriculture while compensating landowners for the fair market value of any development rights that they might give up.

The opportunity cost represented by an acre of agriculture calculated on the basis of its current use -- horse farm, green houses and nurseries, fresh vegetables, frozen and fresh fruits and fruit juices.

The value gained or foregone when agricultural land is converted to other uses -- such as the proposed mixed-use residential and commercial/industrial development -- comparing economic impact through the use of economic multipliers.

Another section -- on infrastructure costs that would be incurred as a result of the proposed mixed-use development and the deficit or surplus that would remain after all impact fees were paid -- was added to the study in January, 1995 and the final study was delivered to the county on October 3, 1995.

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Land that remains in row crop production can generate up to $685,000 per acre more for the county's economy on a cumulative basis over a 50-year period than if houses are built on the land -- an average of nearly $14,000 per acre per year in additional economic activity.  

(This assumes revenues from crop production remain more or less stable; it also assumes an average housing price of $250,000 per home, about $100,000 more than the average priced home at the time the study was conducted.)

Numbers for Palm Beach County's horse industry are even more impressive. A horse farm can attract much more revenue to local communities and the county than a subdivision ... $4 million per acre more on a cumulative basis over the same period. That's a statistical average of $80,000 per acre per year!

A nursery also can generate more than houses ... $4.5 million per acre more on a cumulative basis over the same period. That's almost $91,000 per acre per year in additional economic activity. The number of nurseries in the county, however, cannot be significantly expanded. This is because the market will accommodate only a limited number of nurseries, if they are to remain economically profitable.

Agricultural land -- of all types -- contributes significantly to the tax base. For every $1 generated in tax revenues, agriculture requires only 12 cents for infrastructure and services, leaving 88 cents to support other county needs. Conversely, residential development of the type proposed for the Agriculture Reserve would require $1.10 in services for every $1 generated in revenue.

Agriculture keeps on generating revenue for the county year after year. Although residential use generates significant one-time revenue, it gradually becomes a liability, because of demand for services, such as police and fire protection, schools and roads.

The highest and best use of land may not be residential development, if high-value agricultural uses are being displaced.

Adoption of a proposed Purchase of Agricultural Conservation Easement program -- and an expenditure of $140 million to purchase development rights -- could save taxpayers $477 million over a 50-year period, compared with the costs of allowing the area to be converted out of agriculture in favor of development of 25,880 homes and 485 acres of commercial/industrial establishments.

REFERENCE:

Bevin Beaudet, CH2M Hill, Inc.,800 Fairway Drive, Suite 350, Deerfield Beach, FL 33441. Telephone (954) 426-4008.

Mr. Beaudet was formerly Deputy County Administrator with direct responsibility for all contract worked carried out by Farming for the Future on behalf of American Farmland Trust, including the study described above.

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Lake Soil and Water Conservation District contracted with Farming for the Future in August, 1995 to conduct a study to calculate:

The annual value of all economic activity generated by agriculture, agriculture-related and value-added agriculture business in Lake County through direct cash sales;

The number of employees directly engaged in agriculture and the production of value-added commodities such and citrus juice and wine, and the amount of their payroll;

The indirect economic impact of agriculture, using multipliers from a published input-output table;

The total economic impact of agriculture as measured in dollars;

The percent of tax roll and other local revenues contributed and consumed by land use (comparing agriculture, residential and commercial uses); and

The ratio of community revenues generated to expenses incurred by land use (also comparing agriculture, residential and commercial uses).

The study was published by the Lake Soil & Water Conservation District in August 1996. Its findings show that:

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• Agriculture and food processing in Lake County had a total economic impact for 1992 of $912 million. The industries also generated 7,230 jobs and $165 million in payroll earnings.
• Residential land uses contribute 60% of the revenues received by Lake County government and schools, but account for 96% of the expenses.
• Commercial and industrial land uses contribute 23% of the revenues received, and account for 3% of the expenses.
• Agriculture contributes 5.3% of the revenues, but accounts for only 0.4% of the expenses.

Also:

• For every $1.00 generated in revenues by residential uses, the county spends $1.56 in direct services, thereby creating a deficit.
• For every $1.00 generated in revenues by commercial and industrial uses, the county spends 13 cents in services, thereby creating a surplus.
• For every $1.00 generated in revenues by agricultural uses, the county spends only 7 cents in direct services. Consequently, of the $1.00 contributed by agriculture, 93 cents remains, thereby creating a surplus.

REFERENCE:

Joe Stephany, Ph.D., Chair, Lake Soil and Water Conservation District, 32235 Merry Road, Suite C, Tavares, FL 32778; (352) 343-2481 or (home) (352) 669-5293. Contract Administrator.

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Farming for the Future was chosen to conduct this study through a competitive bidding processes. Funding for the study was provided by the Hillsborough County Board of County Commissioners; The Greater Tampa Chamber of Commerce, Committee of One Hundred; and the Hillsborough County Agricultural Task Force. The study was initiated in November 1995. It was published by the County Administrator's Office in September 1996.

The Hillsborough County Agricultural Cooperative Extension Service also produced a 20-minute video describing the study results which, the study states, "can generally be summed up in a simple comparison:

"Agriculture represents an economic value to Hillsborough County equivalent to hosting a Super Bowl each and every month throughout the year ..."

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• In 1992, all businesses, services and industries in Hillsborough County generated over $44 billion in economic output, employed almost 423,000 people and had a payroll of $9.2 billion.
• If local agriculture was to disappear, the Hillsborough County economy would suffer a loss of $1.5 billion in annual sales, 19,000 jobs and $249 million in payroll earnings.
• Agricultural processing -- which relies primarily on agricultural products from outside Hillsborough County -- also is a major economic contributor. It has a total economic impact of $2.6 billion and generates almost 20,000 jobs and $438 million in payroll earnings.

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• Residential land uses contribute 62% of the revenues received by Hillsborough County government and schools, but account for 94% of the expenses.
• Commercial and industrial land uses contribute 31% of the revenues received, and account for 5% of the expenses.
• Agriculture contributes only 2% of the revenues, but accounts for only 0.3% of the expenses.

Also:

• For every $1.00 generated in revenues by residential uses, the county spends $1.53 in direct services, thereby creating a deficit.
• For every $1.00 generated in revenues by commercial and industrial uses, the county spends only 15 cents in services, thereby creating a surplus.
• For every $1.00 generated in revenues by agricultural uses, the county spends 16 cents in direct services. Consequently, of the $1.00 contributed by agriculture, 84 cents remains, thereby creating a surplus.

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• An acre of aquaculture is the highest contributor to the economy. It was calculated that this activity would contribute $11.4 million per acre to the Hillsborough County economy over a 50-year period.
• The present value of this flow of money over time was calculated to be $2.3 million per acre. (Present value is the amount of money that would have to be invested today in another business, economic activity or security -- with a rate of return at least equal to the rate of inflation -- to replace the revenue that aquaculture would produce.)
• An acre of ornamental plants would contribute $8.1 million (with a present value of $1.6 million) to the economy;
• An acre of strawberries would contribute $4.9 million ($1.0 million present value);
• An acre of vegetables would contribute $2.1 million ($426,000 present value); while
• Residential development together with the resale of homes, combined, would contribute $1.0 million per acre, with a present value of $548,000.

Present Value:

REFERENCES:

Cliff Topping, Project Manager, Committee of One Hundred, Greater Tampa Chamber of Commerce, 401 E. Jackson Street, 21^st Floor, Tampa, FL 33602; (813) 276-9412. Contract Administrator.

Gene Gray, Special Assistant to the County Administrator, Office of the County Administrator, Hillsborough County, 25^th Floor, County Center, P.O. Box 1110, Tampa, FL 33601; (813) 272-6210. County Agricultural Liaison.

Chip Hinton, Executive Director, Florida Strawberry Grower's Association, P.O. Box 2631, Plant City, FL 33561; (813) 752-7653. Chair, Hillsborough County Agricultural Task Force.

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Farming for the Future also has completed a study on the impact of agriculture in Collier County, Florida. The study was originally initiated on behalf of American Farmland Trust. Farming for the Future used this study to develop its countywide methodologies for Florida. The study was completed in November 1996 on behalf of Florida Stewardship Foundation, with funding from the Collier County agricultural, environmental and business communities.

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• Agriculture more than pays its way. Although agriculture contributes less to the tax base than residential land uses, this contribution is more than enough to pay for the community services it requires, such as roads, police and fire protection.
• The Food and Fiber Industry, of which agriculture is a part, is the county's most important employer. It also has the county's third highest payroll and is the county's third most important generator of cash revenues.
• The county's most important economic generator on a per acre basis over time is not residential construction or retail establishments ... but the production of tomatoes. This finding could add new urgency to efforts by the tomato industry to gain help -- and attention -- in counteracting the effects of the North American Free Trade Agreement and other policies that undermine Florida agriculture by encouraging foreign competition in U.S. markets.
• Contrary to common belief, agriculture's impact on groundwater quality and the effects of citrus operations on wildlife populations are virtually negligible.

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• Residential land uses contribute 77% of the revenues received by Collier County government and schools, but account for 94% of the expenses.
• Commercial and industrial land uses contribute 11% of the revenues received, and account for 3% of the expenses.
• Agriculture contributes 2% of the revenues, but accounts for only 1% of the expenses.

Also:

• For every $1.00 generated in revenues by residential uses, the county spends $1.20 in direct services, thereby creating a deficit. This deficit is lower than in many other counties because Collier County has many high priced homes ($500,000 or more), which generate more revenues and help to bring the countywide averages up.
• For every $1.00 generated in revenues by commercial and industrial uses, the county spends only 24 cents in services, thereby creating a surplus.
• For every $1.00 generated in revenues by agricultural uses, the county spends 37 cents in direct services. This number is higher in Collier County because of the services required by the county's large number of migrant farm workers.  Nevertheless, of the $1.00 contributed by agriculture, 63 cents remains, thereby creating a surplus.

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• An acre of tomatoes was the highest contributor to the economy. It was calculated that this activity would contribute $3 million per acre to the Collier County economy over a 50-year period.  (Please note:  this study was conducted prior to enactment of the North American Free Trade Agreement, NAFTA, which subsequently has almost eliminated tomato production from Collier County.)
• The present value of this flow of money over time was calculated to be $600,000 per acre. (Present value is the amount of money that would have to be invested today in another business, economic activity or security -- with a rate of return at least equal to the rate of inflation -- to replace the revenue that tomato production would generate.)
• An acre of green peppers (also severely affected by NAFTA) would contribute $2.1 million (with a present value of $400,000) to the economy;
• Retail activities would contribute $1 million per acre, with a present value of $200,000.
• Residential development together with the resale of homes, combined, would contribute $800,000 per acre, with a present value of $500,000.  

Present Value:

REFERENCES:

Glenn Simpson, Vice President of Environmental Services, Wilkison & Associates, 3506 Exchange Avenue, Naples, FL 33999; (941) 643-2404

Ron Hamel, Executive Director, Gulf Citrus Growers Association, Inc., P.O. Box 1319, LaBelle, FL 34616; (941) 675-2180

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Florida Stewardship Foundation was chosen through a competitive bidding process to conduct a study in Polk County to measure "The Economics of Land Use."  This study, funded by the Polk County Board of County Commissioners, Central Florida Regional Planning Council, Polk County Farm Bureau, Central Florida Development Council, Inc. and IMC-Agrico Company, was completed in January 1999.

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• Residential land uses contribute 51% of the revenues received by Collier County government and schools, but account for 93% of the expenses.
• Commercial and industrial land uses contribute 29% of the revenues received, and account for 5% of the expenses.
• Agriculture contributes 5% of the revenues, but accounts for only 0.4% of the expenses.

Also:

• For every $1.00 generated in revenues by residential uses, the county spends $1.89 in direct services, thereby creating a deficit. This deficit is higher than in many other counties because Polk County has a large number of mobile homes and detached, single-family homes under $100,000.
• For every $1.00 generated in revenues by commercial and industrial uses, the county spends only 18 cents in services, thereby creating a surplus.
• For every $1.00 generated in revenues by agricultural uses, the county spends a mere 8 cents in direct services.  Consequently, of the $1.00 contributed by agriculture, 92 cents remains, thereby creating a surplus.

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• An acre of horticultural (or nursery) products was the highest contributor to the economy. It was calculated that this activity would contribute $2.7 million per acre to the Polk County economy over a 50-year period.  
• The present value of this flow of money over time was calculated to be $637,000 per acre. (Present value is the amount of money that would have to be invested today in another business, economic activity or security -- with a rate of return at least equal to the rate of inflation -- to replace the revenue that a nursery would generate.)
• An acre of citrus would contribute $662,000 (with a present value of $154,000) to the economy;
• Mining would contribute $843,000 per acre, with a present value of $196,000.
• Residential development together with the resale of homes, combined, would contribute $225,000 per acre, with a present value of $133,000. 

Present Value:

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