Municipal Operating Costs and Revenues in Future Developments as a Function of Urban Planning Variables

Abstract

The assessment of a future urban area’s economic sustainability is more valuable if it is available in the early stages of the planning process, when the characteristics of the urban pattern are being established. With the aim to integrate economic sustainability in the urban planning decision-making process, this study develops a simple methodology to obtain analytical expressions for municipal operating costs and revenues in a future urban development exclusively in terms of its urban basic variables. Said formulas facilitate not only the assessment of the area’s economic balance but also the analysis at the local or supralocal level of each variable’s economic role. Its application in a sample of Spanish cities with populations between 1, and 3, inhabitants has shown that, for these cities, municipal revenues depend equally on floor area ratio, property values, and housing density, while expenditures do so first, on relative length of road and second, on housing density. Economic sustainability from the municipal standpoint is usually achieved when housing density ranges from 4 to 8 dwellings per hectare.