Return on investments in Government

Stan Pilant, with the city of Jackson Planning Department stated in a August of 2006 information meeting sponsored by the city planning department that an ROI (Return on Investment) for the city had been developed. I, as yet, have not seen it. This involved, at the time, the largest annexation of developed properties in the history of the city of Jackson, TN.

In a note to Keith Donaldson, Councilman Neudecker queried:

Your boss last night said there was a ROI (return on investment) available. I am assuming that it is in two parts. Part one should JEA’s (ROI) cost to benefit plan over the next ten year period with total outlay estimates by each year with maintenance costs included and the City of Jackson’s ROI separate. Those costs will include all costs related to this project, including planning, building, maintenance of all assets, salaries, pensions, health care, inflation, etc. by year for the next 10 years. Any proposed water shed and drainage programs, recreational facilities, bike trails, walking paths, etc. should also be included in those costs unless there is no plan to provide these. If that is the case, there should be some sort of impact study that would show that the cost that the additional 3000 new citizens to city will have on the present facilities if used.

For those that understand what he was asking for, you know that any expansion in business requires that large piece of information, especially in a tight cash business market. What it should tell you in the end is whether or not you plan to lose money over a certain period of time or you intend to make money over a certain period of time and what percent to investment that is going to be. In government this means if we lose money, they increase taxes, if they make money, we may be able to decrease taxes overall. Simple as that.

Note: That information was never made available.

Recently the city purchased “The Jackson Plaza” without an acceptable financial ROI