JACKSONVILLE, Fla. — As Jacksonville Mayor Donna Deegan begins Wednesday with the first of eight community town halls on her record $2.03 billion budget, one claim is hard to miss.
The mayor says every tax dollar spent by the city generates about three dollars in value/investment for residents.
The claim comes from what the administration calls the first report of its kind in Florida, an analysis prepared by the mayor’s chief of analytics, Dr. Parvez Ahmed.
But Action News Jax Ben Becker found the report relies heavily on economic modeling, national research and assumptions, not direct measurements of Jacksonville’s actual outcomes and one outside expert calls it spin and questions whether it should be described as a return on investment at all.
The mayor’s claim
During her budget address, Deegan said:
“In our analysis of economic value generated by city services, each tax dollar provides nearly $3 in return.”
According to the city’s report:
- The median Jacksonville household pays an estimated $2,864 annually for city services.
- Those services generate an estimated $8,751 in economic value.
- That produces an estimated $5,887 in net value, or roughly a 3-to-1 return on taxpayer dollars.
The analysis assigns dollar values to services including public safety, transportation infrastructure, parks, libraries, and other city programs.
How the numbers were calculated
Ahmed told Becker the report is intended to help residents better understand the value city government provides.
“Investment is another way of looking at what citizens pay in taxes,” Ahmed said. “You can say citizens are paying that in taxes or investing in their own city.”
However, Ahmed acknowledged one of the report’s key limitations.
Many of the dollar values were not measured directly in Jacksonville. Instead, they were estimated using published national research, economic multipliers, and valuation models.
While Ahmed pushed back on the notion that his numbers were “guesses”, he did recognize they are estimates.
“That is one of the limitations of the model. That is certainly true, but it does not negate the value of the model.”
Expert: Economic value is not the same as ROI
Sheila Weinberg, founder and CEO of the nonpartisan fiscal watchdog Truth in Accounting, said the report blurs an important distinction.
She argues measurable economic value and return on investment are different concepts, arguing the report is “a combination of advocacy and spin that implies taxpayers should give the city all their money.”
Weinberg says economic value attempts to estimate the benefits created by government services.
Return on investment, or ROI, is a financial metric comparing the net benefit produced by a specific investment to the amount invested.
“They answer different questions and should not be treated as interchangeable,” Weinberg said.
She also questioned the administration’s repeated description of city spending as an “investment.”
“Some public spending certainly is investment,” she said. “But simply calling an expenditure an investment does not establish that it produced a measurable return.”
Weinberg said another concern is the possibility that benefits are counted more than once and questioned the report’s timeframe.
Roads, parks, libraries, stormwater systems and fire protection are the result of decades of public spending, not just one budget year.
“The report attributes the value of those long-lived assets to a single year’s budget, which is not how ROI is typically measured,” Weinberg said.
Action News Jax also found errors in an earlier version
Becker also identified several mathematical inconsistencies in an earlier version of the report authored by Ahmed.
Among them:
- The reported return for roads was listed as $264 per person in one section but $235 in another.
- Emergency medical services calculations listed $2,702 in one table and $2,798 in another.
- The report’s total annual ROI was listed as $8,753, while the supporting calculation totaled $8,738.
Ahmed said those were transcription errors that have since been corrected and did not affect the report’s final conclusions.
He also welcomed outside scrutiny and says the report is a good faith effort to show how taxpayer dollars are spent.
“That’s why we are publishing it,” Ahmed said. “We are inviting anybody to have a conversation about it.”
Ahmed said he would support city council funding an independent study by researchers at the University of North Florida or Jacksonville University to develop a Jacksonville-specific model, though he said such research could be expensive and take years to complete.
The Deegan administration is scheduled to present its proposed budget to the City Council Finance Committee on August 13.
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