The Growth Ponzi Scheme
The defining characteristic of post-WWII North American development is that it does not generate enough wealth to sustain its own infrastructure.
Phase 1: The Illusion of Wealth
A developer builds a subdivision. They pay for the roads and pipes, then hand them to the city. The city gets immediate property tax revenue and impact fees. Politically, this looks like pure profit.
Phase 2: The Bill Comes Due
30 years later, the roads need repaving and pipes need replacing. The tax yield of those single-family homes covers roughly 10-20% of the replacement cost.
The Ponzi Mechanic
To pay for the 30-year-old crumbling infrastructure, the city cannot raise taxes enough (politically impossible). Instead, it annexes more land and approves more sprawl to get the "hit" of new impact fees and new temporary tax revenue. The new growth pays for the old liabilities, but creates even larger liabilities for year 60.
The Mathematical Proof
You can prove this in your own municipality. Take the total linear feet of city-owned roads, multiply by the replacement cost ($1M/mile), divide by 30 years. Compare that annual liability to the entire public works budget. The gap is the unfunded liability.
Run the Breakeven CalculatorTo fix this, cities must end Euclidean zoning (read: Zoning Policy) and aggressively pursue Missing Middle Housing to increase tax yield per acre.