Local A News Bulletin from

Government

Briefings

April 4, 2008, Volume 11, Issue 14

In This Week’s Edition:

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Fullerton Learns That Economic Development Isn't Always What it's Cracked Up

to Be

Economic development is good for city revenues. Nobody is going to argue with that.

Or are they? Consider the results of this excellent audit done in Fullerton, California. Back in 2002, the

city created a restaurant district, and it's been a smashing success. The number of restaurants and bars

has grown dramatically, and the downtown has turned into a much more vibrant place. This has brought

in about $500,000 a year in new revenue.

But when the auditor looked a little more closely, it turned out that the city's costs for police, fire and

maintenance services have also skyrocketed. The estimate is that this new growth costs the city about

$1.5 million a year. The city council paid attention and "approved new restrictions on food establishments,

limiting outdoor drinking areas and authorized the City to explore new methods of raising revenue

specifically tied to the ... district."

Excerpted from the B&G Report, governing.com, by Katherine Barrett & Richard Greene, March 2008

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