Report: Costs to add 2,800 acres to Lexington growth boundary will top $570 million
It will cost at least $570 million to add 2,800 acres to Fayette County’s growth boundary in coming years, a recent report estimates.
That estimate does not include local roadways, stormwater, water lines or new schools.
Some of the big-ticket items included in the cost estimate are new police and fire stations, major roadway and intersection improvements, trails and new parks.
The ongoing costs in additional staff for police, fire and other city services will be about $7.8 million a year when all 2,833 acres is developed, said Anita Morrison during an Urban County Planning Commission meeting Thursday.
Morrison is with Partners with Economic Solutions, one of several consultants hired to help the city develop a master plan for the new expansion area.
But more than 90% of the $570 million will be paid by the developer. Less than 10% or $53 million will be paid by the local government, she said.
Developers typically pay for such things as new roads, sewer and water lines, Morrison said.
“Not all the costs will be borne at once. It will be over time,” Morrison cautioned.
How those costs will be divided and how it will be paid for will be determined later this fall, said Jim Duncan, director of planning for the city.
The Lexington-Fayette Urban County Council voted in June 2023 to expand the growth boundary for the first time since 1996. The council cited the need for more housing as a driving factor in adding more land for development.
The initial plans for the 2,800 acres includes multiple new housing developments, retail space and some industrial or flex space. The land that will be added to Lexington’s growth boundary include parcels off of Parkers Mill Road and Man O War Boulevard, Winchester Road and Interstate 64 and Athens Boonesboro Road and I-75.
Lots of housing, but not many jobs
The number of housing units added will be between 17,000 and 26,000, Morrison said. That could mean an additional 39,000 to 58,000 new residents. That’s a 12% to 18% increase in population.
The plans for those areas show multiple types of housing -- duplexes, apartments, homes and townhomes.
“This will be more dense,” said Morrison. “It will not be the single-family homes that you see in the current expansion area.”
That increased density will hopefully bring down the cost per acre to develop, she said.
Lots of new homes will generate property taxes. Property taxes largely benefit the Fayette County Public School System. City services are largely funded through a tax on jobs called an occupational tax.
The new expansion area will not generate much additional revenue in occupational taxes for the city, Morrison said.
The study only estimates between 2,000 to 3,000 new jobs created in those areas.
