Study: Jail would boost tax rolls, not harm property values in Ferndale


FERNDALE - If a new jail for Whatcom County is built in Ferndale, it will boost the city's sales and utility tax revenues while having little effect on the cost of city services or neighboring property values.

This is the conclusion of a study completed Aug. 19 by Berk and Associates, a Seattle consulting firm, and obtained Wednesday, Sept. 4, by The Bellingham Herald. The fiscal study is part of a larger environmental impact study of the jail, to be released as early as the week of Sept. 16, according to Whatcom County Executive Jack Louws' office.

In general, the study said, new jails have no noticeable impact on the values of nearby properties, although "the greatest potential for impacts certainly exists in the immediate vicinity of the facility."

The potential influence of a jail on property values near the proposed site at the corner of LaBounty Drive and Sunset Avenue is especially insignificant, the report said. The land is set aside for industry, and the typical manufacturing plant would have more truck traffic, noise and unwanted odors than a jail, the study said.

"There is some potential for impact to the nearby residential uses, but the level of impact really depends on what might be built on the site if the jail does not go forward," the report said.

Within a half-mile radius of the jail site, 16 percent of the land allows residences.

Neighbors such as Robert French, who spoke to the Ferndale City Council on Tuesday, Sept. 3, worry a jail would reduce quality of life, safety and property values. The study appears to challenge the accepted wisdom of the neighborhood.

"The study and the conclusions from other jurisdictions make me feel more confident that there won't be a substantial negative property value impact as some have feared," said Jori Burnett, Ferndale's community development director. "But a study doesn't make it so."

"I don't have a crystal ball," Burnett added.

Along with property values, safety should not concern neighbors, the Berk report suggested.

"Studies have shown that the presence of a correctional facility does not create additional crime in a community, but among community members there may be a perception that crime is more prevalent," the study said.

The consultants showed no added burden to city services and even a small cost savings to the Ferndale Police Department for reduced time and fuel spent transporting inmates.

Taxes from the sale of the 40-acre LaBounty Drive property to the county, and jail construction, would benefit the city, according to the study's estimates. The city should receive tax revenue of $617,500, based on an estimated construction cost of $77 million and a purchase price of $6.9 million for the land. The city collects 0.5 percent on each property sale, in addition to a sales tax on construction materials.

The construction cost estimate is not based on a specific design, so it is preliminary. The land price comes from the county's draft purchase agreement but could change.

Once completed, the jail would continue to pay utility and sales taxes to the city - about $57,000 a year, according to the study.

"The jail buys a lot of stuff for the jail, for the inmates," city Administrator Greg Young said. "So they generate a significant ... amount of (ongoing) sales tax."

The city would not collect property tax on the publicly owned land where the jail was built. A privately owned industrial lot worth $1 million would pay an annual property tax to the city's general fund of $1,990.

The study, which cost less than $10,000, was requested by Ferndale officials and paid for by the county. City officials had said the county might be asked to compensate the city if the study showed the jail would be a net drain on the city's budget.

Any compensation wouldn't be considered until permitting of the jail is completed, Louws said. The county would pay for its share of road and utility improvements to accommodate the jail.

Reach Ralph Schwartz at 360-715-2289 or Read his Politics Blog at or follow him on Twitter at @bhamheraldpolitics.

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