In 2009, the Trust for Public Land (TPL) published a report entitled “Measuring the Economic Benefits of a City Park System.” The report identified seven different ways parks generate measurable revenue or savings to a growing municipality.
First, residences near high-quality, well-maintained parks increase in value relative to similar properties located farther away, with the added value typically being around 15 percent for the properties closest to the park. This “proximity effect” on home value translates into increased property tax revenue for the municipality.
Second, high-quality parks attract not only local users but also visitors from out-of-town who spend money on food and other purchases, which yield sales tax revenue to the municipality.
Aside from the direct income that parks generate for the public coffers from increased property and sales tax receipts, parks provide residents with various kinds of direct savings. For example, residents’ use of free public parkland and free or low-cost recreational opportunities saves residents’ from having to pay for these amenities in the private marketplace (“direct use value”).
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Exercise in public parks also confers health benefits that translate into medical cost savings.
A harder to measure, but equally important, form of savings is the increased community cohesion parks and other public gathering places support. This increased community cohesion helps ward off antisocial problems associated with urbanization that otherwise would cost the city more in police and fire protection, prisons, counseling, and rehabilitation.
Finally, parks provide ecological services that generate environmental savings, such as retention of rainfall by the park’s vegetation and soil, thus reducing the need for costly stormwater management infrastructure.
In a 2010 report, TPL applied this methodology to the Mecklenburg County, North Carolina, park and recreation and system and estimated that, in 2009, the park system provided the county with revenue of $8.3 million, a collective increase of resident wealth of almost $29 million (i.e., from home value appreciation attributable to park proximity), resident savings of more than $922 million (mostly from direct use value), and municipal savings of $25 million.
Economists who have studied the fiscal impacts of municipal parks, such as Texas A&M professor John Crompton and Michigan State professor Sarah Nicholls, note that, “contrary to popular perceptions, development of parks and open space is more fiscally beneficial to a community than residential development,” and that “the increase in property tax from housing in close proximity to green spaces may equal or even exceed the costs of maintaining (the green spaces).”
Given the many and substantial economic benefits associated with parks, it is unfortunate that the previous mayor and Town Council last fall passed up the opportunity to purchase the 36-acre American Legion property – adjacent to an existing, undersized town park and to Ephesus Road Elementary School – and that they instead sanctioned town staff’s efforts to interest a developer of luxury apartments in acquiring the site.
The new mayor and Town Council now have an opportunity to remedy the situation and to heed the advice of their own Parks, Greenways, and Recreation Commission, which has unanimously recommended that the town purchase some or all of the American Legion property for park land. Our elected officials should communicate clearly and consistently to the interested developer that the town does not need, and that they will not approve, any more market-rate apartment housing. If the town then gets a second chance to buy the property, there are a variety of ways it might finance the purchase.
Note that the Legion’s $9 million asking price is almost twice the property’s appraised value, and that the developer offered to pay that amount not for the property as it is, but, rather, for the land plus entitlements that the town has no reason and no obligation to provide. The cost to the town of acquiring the property will thus be considerably less.
We tend to think of public parks only as cost centers, but, as noted above, parks are also important sources of revenue and savings. Far from being a drain on town finances, the creation of “Legion Park” will yield generous dividends to our community, fiscal and otherwise, far into the future.
David Schwartz lives in Chapel Hill.