Farmland Information Center Fact Sheet: Cost of Community Services

Cost of community services studies can be used to address the following three claims:

• Open lands, including working farms and forests, should be developed to their “highest and best use”
• when agricultural land is assessed at its farming or ranching value instead of its potential value as residential or commercial development, it receives an unfair tax break
• residential development lowers property taxes by increasing the tax base.

Although working and open space lands may generate less revenue than residential, commercial or industrial properties, they require less public infrastructure and fewer community services.

A summary of several Cost of Community Services studies from 25 states shows that on average, the median cost, per dollar of revenue raised, to provide public services for commercial and industrial lands was $0.29, for working and open space lands was $0.35, and for residential lands was $1.16.