American crime fiction with a dystopian element. A town has been created in the desert, made up of offenders with mysterious pasts. The community lives in harmony until someone is killed.

[Toby]

This is a relatively modern book, I only read it a few years ago.
A cop is brought in from outside the project to investigate the death, he is treated with suspicion as an outsider. As he investigate, he begins to question the purpose of this community, which gets him into trouble. The action builds to a grand finale shootout in a church, with very few survivors as I recall.

[KRutt]

This kind of sounds like the Rockton series by Kelley Armstrong. Though that is a female investigator and the town is in the Yukon....
First book is City of the Lost

[Kris]

Pines by Blake Crouch seems match your description. (Although, KRutt's suggestion of the Rockton series first came to mind as well.)

Google Books preview:
https://books.google.com/books?id=6mO... There are different cover images.