How much does a kid cost?

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How much does a kid cost?Just below the surface of most land-use/housing debates is the cost of educating children. A lot of towns effectively zone out many types of affordable housing because they don’t believe they will receive property tax benefits high enough to educate the children who would live there.

The UMass Donahue Institute takes a stab at answering this question based on actual cases from a number of metro Boston communities.

I’d crudely summarize their findings as a matter of cost allocation methodology. You have three choices:

  • Marginal Cost of New Housing — attempts to determine what new expenditures were required by the town for the new housing units. Very easy to determine for most services (e.g. did the police respond to any calls? If not, no marginal cost), except for education. Tends to produce the lowest cost of new services for housing units.
  • Per Capita Cost — Allocates the average cost of services to the units. For example, each new kid is costed out at the average cost to educate a student in that town. Produces the highest cost per new housing unit.
  • “Fair Share” Approach — allocates the cost of services on a per unit. In this approach, education costs are spread out evenly across every unit of housing, new and existing.

The Donahue Institute study is advocating for the “Fair Share” approach which produced more mixed results in terms of the ‘cost of new housing’ versus property tax income. I’m not sure most towns would accept this argument, but I’m curious if this moves the argument about new housing forward. The Boston Globe certainly thinks so.