In Lexington-Fayette County, Kentucky, farmland more than pays its way. American Farmland Trust studied the cost of community services and found that farm and open land create a fiscal surplus to the county.

The study found that farm and open land contribute more in tax revenues than they receive back for public services: For every dollar generated, Fayette County only spent $0.93 in public services for farm and open land. Residential development was expensive; it cost county coffers $1.64 for every dollar generated. Because the majority of the county’s funding comes from an employee withholding tax, commercial/industrial uses generated the highest revenues: For every dollar raised, the county only spent $0.22 in public services.

Findings demonstrate that it pays to maintain existing businesses, including farm businesses, in Fayette County. Beyond its fiscal contribution, agriculture – and the farm and open land that support it – generates more than $1 billion annually to the regional economy.

These findings provide new information about the current land use distribution in Fayette County. Since farm and open land is contributing excess revenues that residential development is not, the findings suggest that converting it to scattered residential development outside of the
urban service area will prove to be economically shortsighted. Combined with information about long-term impacts of growth, knowledge about how current land uses affect local finances will be useful as persistent growth pressures make it crucial that the county continue to make informed policy and planning decisions.