Ruston, LA: A Case Study in Fiscal Sustainability and Disaster Recovery

by Martina Guglielmone, Economic Development Associate at Smart Growth America

Background 

Ruston is a college town of almost 22,000 in Lincoln Parish, Louisiana, and the home of Louisiana Tech University with a student body of about 17,000 students. In late 2018, Smart Growth America (SGA) began a technical assistance engagement with the City of Ruston through the United States Department of Agriculture (USDA) Rural Community Development Initiative (RCDI). The goal was to aid the City through the development and implementation of strategies to encourage economic and fiscal health at the local and regional level. The SGA team met with local leaders and residents to provide assistance via the Planning for Economic and Fiscal Health tool developed through a grant from the US Environmental Protection Agency. 

On April 25th, 2019, an EF-3 tornado with winds as strong as 165 mph tore through northern Louisiana. Ruston suffered immense devastation as the tornado passed directly through the middle of the city, leaving severe damage to homes, businesses, and several facilities owned by Louisiana Tech. The wreckage of the tornado highlighted the importance of the role that development planning has not only for economic prosperity, but also for hazard mitigation and resilience. 

Smart Growth and Disaster Resilience 

As in many other communities that have experienced devastation from natural disasters, the aftermath of the April 2019 tornado unleashed a series of challenges that threatened Ruston’s social and economic stability. A total of 311 structures and a power grid were destroyed in Ruston alone, and over 60 metric tons of debris covered the city’s streets, parks, and properties. 

By June 2020, the City had spent about $6 million in repairs and received an additional $2 million from FEMA. In order to qualify for FEMA aid, the President and Governor had to sign emergency declarations and report meeting the threshold of almost $7 million in public damages. 

To restabilize their budget, Ruston had to cut $2 million from the next fiscal year’s general fund and it is anticipated that public operations that are not directly related to recovery will be limited to a conservative budget for many years to come. The tornado was a tragic event for the community, and it is precisely events like this that beg for the consideration of how development patterns are tied to communities’ ability to get back on their feet. 

It is critical, and in fact possible, to mitigate the cycle of disaster-recovery destruction through a smarter design of the built environment. How and where municipalities choose to reinvest after a disaster like the April 2019 tornado must be a strategic decision, considering implications to the public budget in the long run. Ruston’s geographic location makes it particularly vulnerable to tornadoes and hurricanes, making smart growth planning necessary for the long-term wellbeing of the community. 

A few lessons we have learned along the way from technical assistance projects like Ruston are: 

The fiscal impact of development patterns ought to be a central consideration for recovery and resilience planning for communities vulnerable to natural disasters.

Development patterns that sprawl outward from a city center dilute and divert resources from downtown and increase the cost of maintenance and delivery of municipal services. The cost per capita of public services and infrastructure like roads, water/wastewater, fire and police protection, and public transportation tends to decline as density increases. Sprawling developments require extensive investments in capital infrastructure to serve relatively fewer people (and taxpaying property) and ongoing service delivery that requires providers to travel farther. Denser development patterns reduce both lifecycle infrastructure costs and operating costs. 

SGA’s studies of more than 20 different municipalities provide evidence that new sprawling development often generates a negative net fiscal impact -- that is, it can add more to the local governments’ costs than it yields in new revenue. A 2013 report, Building Better Budgets: A National Examination of the Fiscal Benefits of Smart Growth Development, found that more compact development can result in savings of one-third or more in capital infrastructure costs and 10% annually in operating expenses compared to traditional suburban patterns. It can also generate up to 10 times more revenue on a per-acre basis. 

The smart allocation of fiscal resources over time results in reduced damage and loss of property caused by disasters, as well as cost of disaster response needs such as debris collection and disposal, and fire and medical response services.

There are opportunities for smart growth redevelopment in communities with traditional development patterns. 

SGA performed a fiscal hotspot analysis for Ruston which indicated that properties in the downtown area were highly valuable – an average of $68,000 per acre compared to the city’s average of $16,251 per acre. A fiscal hotspot analysis helps to visualize where high- and low-value properties are clustered and point to best opportunities for return on public investment. Based on this analysis, SGA recommended that new housing developments be focused in downtown Ruston with particular emphasis on workforce and student housing. 

Municipalities can also reduce excessive public expenditure by focusing new development where there is existing infrastructure in place to support these projects. Accommodating several households in spaces that would otherwise be occupied by a single unit can contribute to an increase in the area’s tax revenue while relatively lowering the on-going cost of maintenance and service delivery.

Smart growth strategies centered around hazard mitigation also foster simultaneous benefits that further justify investment in infrastructure. 

The positive effects of denser development patterns, increased mobility and connectivity, and emphasis on a socially vibrant and economically active central area are well documented. Guiding recovery preparedness planning with these principles most often contributes to the enhancement of other community conditions including housing affordability, public health and safety, economic prosperity, and energy security. More information can be found in the publication Building Resilient States: A Framework for Agencies. from the Governor’s Institute on Community Design.

Successful smart and safe growth requires a consistent and coordinated long-term effort. 

Adjustments to each element of the development planning process need to be made persistently and over time. The government, utility companies, non-profit sector, and other private parties must work towards a shared vision and invest in efforts to promote compact development in areas of high infrastructure capacity. The adoption of development planning as a tool for increasing the resilience of the built environment and economic health requires a cultural shift that fundamentally integrates resiliency in growth. Leadership support, legislative action, regulatory consistency, and cohesion in government action are key.