Our Experience

Industries Petroleum Natural Gas Chemicals Electronics Pharmaceuticals, Medical Devices, & Biotech Retail/Consumer Goods Technology Transportation Local/State Government School Districts Other Industries

Functional Areas Antitrust & Competition Analysis of Damages Forensic Economics Intangibles/IP Labor Economics Regulatory Economics & Finance Transfer Pricing Taxation Valuation Fiscal Impact Analysis Demographic Analysis Public Policy Analysis

 

Local and State Government

IIC, Inc.’s government consulting practice serves a variety of public and private sector clients. We prepare fiscal and economic impact analyses relating to various parameters such as population, employment, income, business location, assessments, and taxation. We also analyze costs and benefits of various programs and proposals including zoning, construction, and development projects. Through the use of economic and financial analysis, we can show the likely impacts on a local municipality of such a proposal, demands on infrastructure and likely sources of revenue to cover the increased demand for services. We are knowledgeable about state and federal programs that may influence such impacts and the budgeting process at the local level.

Statewide School Enrollment Projections

For the Massachusetts School Building Authority (MSBA), we have recently developed a large-scale school enrollment projection model to be used by the MSBA to predict annual and ten-year grade level district enrollment forecasts from kindergarten through high school. The model is being used by the MSBA to evaluate new school building needs throughout the 351 Massachusetts communities and regional school districts and enables the Authority to place the needs assessment on a comparable basis across these communities and districts using a consistent methodology and data. We have developed a user guide and training materials so that MSBA staff can use the model. The web-based application is available for all communities to use as a forecasting tool.

Educational Impact Fees

For the Miami-Dade County School District, we developed a fiscal impact model that analyzed the impact of new residential development on school enrollment, and the cost of such development in terms of the number of new school stations required to meet the demand caused directly by the new development. We developed impact fees based on our assessment methodology that considered the type of residence (condo, apartment, single family dwelling), size (e.g., number of bedrooms), location, and cost of new school construction. We have subsequently analyzed the impact of changes in development patterns and growth trends on the fiscal impact model. Throughout the study, we worked with two groups, an internal client-based review panel as well as with a much broader stakeholder group in developing the model and presenting its results. The internal panel included representatives from all potentially affected government agencies including the School Administration, the School Board, County Planning, and the County Commissioners. The stakeholder groups reflected all of these government groups as well as the external building, real estate, and commercial interests throughout the county who would be potentially affected (often adversely) by the results of our work. We met throughout the course of our work to explain the model, its inputs and assumptions as well as the results and the basis for our proposed impact fees. In addition, we had several follow-up meetings with specific stakeholder groups to provide further explanation and support for our model.

Tax Incidence Analysis

For a number of state agencies including Attorneys General and tax collection agencies, we developed an economic model that measured the incidence of various state business taxes that were found to be unconstitutional and required the distribution of refunds. The economic tax incidence model was used to determine the extent to which the tax was passed on downstream to consumers as opposed to being absorbed by the companies making the claim for the refund. This model was built on the economic theory of tax incidence analysis and considered the supply and demand conditions in the relevant industry as well the nature of competition in developing incidence estimates.

Tax Rate Decisions

One decision for local government is whether to implement a uniform tax rate for all taxable entities, or whether to differentiate between the tax rate applied to residences and that applied to businesses. IIC, Inc. completed a study of the effect of split tax rates (municipal property taxes) on local and regional commercial development using time series econometric analysis. We evaluated the investment decision of businesses to locate in a particular community based on prevailing tax rates, location, demographic trends, and the existence of split or uniform tax rates. Based on our research and statistical analysis, we concluded that location was the dominant variable explaining where businesses chose to invest, not whether a community imposed a differentiated tax rate.

Enrollment Projections

IIC, Inc. has developed an enrollment model for projecting the likely enrollment of a school district using historic data and current information regarding number of births, number of housing starts, and general population trends. Using a cohort-survival method, the model predicts numbers of students based upon how many students have historically arrived at each grade level. In one case, the model was used to predict the number of students who would be enrolled in special education and bilingual classrooms as well, while recognizing the greater volatility within these populations. IIC, Inc. then documented its findings in a report and presentation to the municipality, and these enrollment projections have become an important tool to build budgets for future years.