FiWiStep - Fiscal Impacts of Urban Development Projects

The aim of the FiWiStep research project was to develop an application-oriented methodology for estimating the budget effects of urban development projects in Vienna and to test it in a pilot project for two selected case study areas (Tokiostraße and Donaufeld). The focus is on the fiscal effects of a variation of basic planning parameters, especially building density. The computation developed for this purpose is based on the methodology of fiscal impact analysis. All one-off and current expenditures (above all infrastructure expenditures and inhabitant related expenditures) as well as revenues (primarily fees and taxes) arising in connection with the development and use of a district in the municipal budget are delimited and quantified on the basis of model calculations and information from planning practice. The fiscal effects determined in this way are netted over a period of 50 years and reflected in key figures of fiscal profitability. The model comprises eight function-specific modules that model fiscally relevant processes in the areas of demography and economy, technical infrastructure, green space, local public transport, social infrastructure, real estate transactions, tax revenues and other net expenditures. In addition to detailed results on the profitability of the two urban development projects examined, the following general findings were obtained: 1. Settlement development is not free of charge: even in Vienna, with its special features as a country and municipality, an automatic fiscal gain through population growth and influx cannot be assumed. 2. The economic sustainability of the city depends not least on a balanced relationship between the residential and working population, since part of the population-related infrastructure is financed by tax revenues from operational use. 3. the cumulated "follow-up costs" of a project development are usually considerably higher than the investment costs, so that their early consideration in planning decisions is necessary. 4. Density-related determinations influence the profitability of a project: densely built-up housing developments are "more profitable" in the fiscal sense as long as jump costs or density-related quality losses (lack of open spaces, selective migration of the population, etc.) do not reverse this effect. 5. The fiscal effect depends not least on the urban context of the respective project development, with clear advantages of an inner development.