Category Archives: Land use & development

Silicon Valley Knows Technology, Not Land Use

Apple headquarters, Cupertino, Calif.

Apple headquarters, Cupertino, Calif. Impressive facade but poor public spaces.

by James A. Bacon

Apple, Google and other collosi of Silicon Valley are re-shaping the world with their technology but you could never imagine them as masters of innovation by viewing their corporate campuses. While the office interiors may be arrayed with java bars and collaborative workplaces to stimulate creativity, the building exteriors are for the most part bland steel-and-glass boxes of a type that can be found anywhere in the United States. Moreover, surrounded by parking lots and landscaping, the buildings are isolated — islands in a sea of mulch and asphalt. Creativity and interaction end at the front door. The streets, sidewalks and other pieces of the public realm are innovation dead zones.

That was the impression I gained from the Bacon family’s whirlwind tour of Silicon Valley earlier this week that took in the corporate headquarters not only of Apple and Google but Hewlett-Packard, Yahoo! and LinkedIn. Perhaps we arrived at the wrong time of year, the wrong time of the week or the wrong hour of the day but we saw almost nothing going on. Most of the street-level activity at Apple was generated by tourist traffic to the Apple store. The environs of the famed Googleplex were even more desolate.

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Vaughn and Wilson in “The Internship.”

I was expecting bustling outdoor scenes like those shown in the movie, “The Internship,” in which Owen Wilson and Vince Vaughn finagled their way into summer jobs at Google and into movie goers’ hearts. We didn’t see bupkis. I sneaked around the back of one of the buildings in the Googleplex and did discover an inviting patio with bright umbrellas but didn’t see anyone except a couple of maintenance guys standing around and shooting the breeze. As we drove around the Google corporate campus with its dozens of buildings, we did espy one multi-colored Google bike leaning against a wall and we did spot one fellow riding down the road, but we saw hardly anyone walking outside. Undoubtedly, billions of neurons were burning brightly inside Google’s buildings — but there was no sign of the company’s massive brainpower on display outside. It turns out that, according to CNN, much of the movie wasn’t filmed at Google at all — but the Georgia Institute of Technology campus in Atlanta!

The Google H.Q. is so low-key in appearance, we wondered if we had the right place. According to the Google corporate address listed in Google maps, we did.

The Google H.Q. is so low-key in appearance, we wondered if we had the right place. This is where Google Maps led us.

Who cares whether the innovation occurs inside or outside? Why mess with a proven formula? More to the point, what does a techno-tard like me have useful to say to the likes of Apple and Google, two of the greatest wealth creation machines in human history?

I didn’t visit Silicon Valley with the idea of lecturing the region’s political, business and civic leaders how to improve, which would be incredibly presumptuous on my part. I visited to learn what lessons other communities might learn. Scores of regions around the United States yearn to re-create some of the valley’s technology magic, and I worry they could draw the wrong conclusions. The one dimension of Silicon Valley that others can most readily replicate is its “suburban sprawl” pattern of development — and that would be the worst possible lesson to take away.

Apple parking lot

The parking lots outside Apple’s headquarters are beautifully landscaped but they wall off pedestrian access to the world outside.

I would humbly suggest that Silicon Valley has been insanely successful in spite of its dysfunctional human settlement patterns. Combine world-class research universities, the largest venture capital community in the world and an unparalleled workforce, then shake and stir. You’ll get technological innovation. Silicon Valley’s corporations can create a built environment that discourages interaction outside the firm and it doesn’t matter — the advantages of a Silicon Valley location far outweigh the drawbacks. But no one else has Silicon Valley’s potent mix of research universities, venture capitalists and the smartest engineers drawn from around the world. Other communities need every competitive advantage they can muster — and smarter land use patterns is one of them.

As Hans Johannson has argued in his book, “The Medici Effect,” innovation comes at the intersection — the intersection of different industries, disciplines, cultures or ways of thinking — that allow people to make unlikely combinations of ideas. Some places lend themselves to that kind of interaction, others don’t. Based on her experience living in Greenwich Village a generation ago, renowned urbanist Jane Jacobs brilliantly argued that sidewalks, small parks and mixed uses lent themselves to the kind of meetings and encounters, often serendipitous, where different perspectives and ideas can collide. To spawn entrepreneurship from the ground up, those are the kinds of neighborhoods and communities that aspiring tech centers should be creating.

The built environment of Silicon Valley is Northern Virginia with palm trees — predominantly single-family houses, strip malls and office parks. Thanks to municipal codes and NIMBYs, the region can increase density only sparingly, so it cannot grow “up” by building taller buildings. But wedged between the bay to the north and mountains to the south, it cannot grow “out” through additional sprawl. As a consequence, real estate prices are incredibly high. The cost of housing across the Valley and throughout the entire Bay area is consistently cited as one of the greatest hindrances to living there. The number of homeless in the San Jose metro region, according to the Wall Street Journal, numbers roughly 7,600. To adopt similar land use policies would suicidal for any other region.

Municipal leaders recognize these shortcomings and are attempting belatedly and with mixed results to deal with them. I will discuss two such initiatives in Sunnyvale, as time permits.

In Praise of Small Spaces

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Stairway across from the Ritz Carlton on Nob Hill.

by James A. Bacon

I am fascinated by small urban spaces that normally elude the attention of city planners,  star architects and travel magazines. In low-density settings where low value is placed on land, inhabitants pay little heed to the small spaces. But in densely settled cities, residents apply loving creativity to making the most of the nooks, the crannies, the alleyways and the odd bits of land around them. The accumulation of detail in these small spaces is part of what makes a city like San Francisco great.

Some of the most interesting sights I saw here were tucked away in alleyways and in-between spaces. Many of them were stairways.  The photo above shows a particularly beautiful stairway that led between two houses to a destination up the hill. (I was too tired trudging up and down hills to see where it led.)  With manicured trees and flowers along the edge, this stairway was a significant enhancement to the neighborhood.

The stairway below is all the more interesting because it is all the more ordinary, part of an alleyway on a steep hillside that provides access to several nondescript apartment dwellings. It shows few signs of anyone having lavished money upon expensive materials or landscaping upon it, yet it is visually interesting nonetheless.

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Fracking the Mother of Presidents

fracking rigBy Peter Galuszka

Controversial hydraulic fracking appears to becoming a distinct possibility in areas south and east of Fredericksburg on land that is famed for its bucolic and watery splendors along with being the birthplaces of such historical figures as George Washington, James Monroe and Robert E. Lee.

After several years of exploring and buying up 84,000 acres worth of leases from Carolina to Westmoreland Counties, a Dallas-based company that uses a post office box as its headquarters address participated in the first-ever public discussion of what its plans may be.

According to the Free-Lance Star, the meeting was put together by King George County Supervisor Rudy Brabo to air concerns and hear plans of Shore Exploration and Production Co., which is based in Dallas and has offices in Bowling Green. Its headquarters address is registered with the State Corporation Commission as P.O. Box 38101 in Dallas.

About 100 people attended the meeting April 14, but judging from the newspaper’s account, not many questions were answered. Participants repeatedly asked Shore CEO Ed DeJarnette what his plans were regarding fracking and who would be responsible for damages if something went wrong.

DeJarnette responded that his firm is merely buying up leases and is looking to sell them to other gas drillers and operators. The state’s Department of Mines, Minerals and Energy issues permits one at a time and is responsible for enforcing them, he said.

Hydraulic fracking and horizontal drilling have touched off a revolution in the American energy industry in recent years, particularly in the Marcellus Shale gas formations that stretch in the Appalachians from New York State to southwest Virginia. The methods have also been used to reach rich shale oil deposits in North Dakota and other western states.

Fracking has been used as a drilling process for years according to media accounts and authors such as Gregory Zuckerman whose recent book “The Frackers” covers the process’s increasingly widespread use in the past several years.

Among concerns are that the toxic chemicals mixed with water and then pumped hundreds of feet underground could eventually ruin groundwater serving streams and wells. Other concerns are that the inevitable “flowback” in drilling will require surface ponds to handle toxic waste. In places such as Pennsylvania and West Virginia where fracking is permitted, quiet country areas are badly disturbed by the roar of diesel generators at drilling sites and from trucks that are constantly delivering drilling supplies. Methane can leak from drilling rigs, further complicating global warming issues, and flash fires can be problems. Fracking can also consume great amounts of water which often has to be trucked in.

On the plus side, holders of mineral leases can receive great sums in royalties and various taxes and other payments can boost local tax coffers. Natural gas is cleaner and less deadly source of energy than coal, plays a big role in electricity power generation in the Mid-Atlantic.

At the King George meeting, DeJarnette told the audience that he preferred using nitrogen as an element in fracking rather than water, but there were few details in the newspaper story.

While providing scarce details on who would actually handle the drilling, how it would be done and who would be responsible for damages, DeJarnette repeatedly emphasized the monetary benefits and jobs fracking would bring.

If it proceeds, fracking in the Taylorsville Basin would likely be confined to Virginia, which is more business-friendly than Maryland where the basin also extends. The field stretches across the Potomac River into Charles, St. Mary’s, Calvert and Anne Arundel Counties but Maryland has a moratorium on fracking until it can be studied further.

DeJarnette says he wants drilling to start by late this year or in 2015. Major oil firms explored the Northern Neck area and found some evidence of oil and gas deposits there in the 1980s.

The City of Great Places

Belden Street

Belden Street

So, here we are in San Francisco, in the heart of the land of fruits and nuts. We’re  planning to do a lot of the usual tourista things — take the boat to Alcatraz, bike to Sausalito, visit the Exploratorium — but your roving correspondent also will be applying a keen eye to the human settlements patterns of one of the United States’ most remarkable urban experiments.

San Francisco and nearby Silicon Valley comprise the most economically productive region in the U.S. (with the possible exception of Manhattan, although I regard the New York financial industry as a monstrous parasite that, due to Quantitative Easing, prospers at the expense of the rest of the country). San Francisco and San Jose (and environs in between) also happen to have the most expensive real estate prices (outside, perhaps, Manhattan) and the greatest income inequality in the country. Yet there is a remarkable divergence between Frisco and Silicon Valley. San Francisco hews to the Smart Growth ideals of higher density, mixed-use, walkable and transit-oriented human settlement patterns while Silicon Valley epitomizes sprawl. San Francisco is a tourist destination; Silicon Valley is not. I don’t know what all that adds up to but it is my framework for writing whatever I write about.

First observations: Arriving Saturday evening fatigued from a long trip, the Bacon farrow (farrow? Look it up.) checked into its hotel and set out to grab a meal before hitting the sack. There is a delightful little street near our hotel — Belden Street on the edge of Chinatown (see photo above). It really isn’t even a street, it’s more of an alleyway, too narrow for cars, that is lined with seven or eight restaurants. There is nothing exceptional about the street; it’s just one small example of the place-making that inspires love of this city. The alleyway is a visual surprise in that is represents a departure from the dominant street grid. Cozy and intimate in its human scale, it is a delight to stroll through.

Multiply Belden Street hundreds of times across the region and you get a place where people love to live and are fiercely loyal to.

– JAB 

“Where Is the Closest Tiki Bar?”

tiki_barBy Peter Galuszka

Often times, blog commenters really hit the nail on the head. This is the case with “Virginiagal2” who responded to my blog post earlier this week that Richmond’s schools are decrepit and crumbling, as Style Weekly detailed in a recent cover story.

They note that Richmond’s elite has done little for its public schools while chasing higher-profile and extraneous projects such as a summer training camp for the Washington Redskins and a new baseball stadium for the Minor League AA Flying Squirrels.

Schools? What schools?

Blog posts also note that NFL football star Russell Wilson, a Richmonder, stayed at private Collegiate school after his father saw academics as more important than sports and blunted maneuvers by Richmond public schools to recruit Wilson during his school years.

Part of the problem, as Virginiagal2 notes, is that Richmond’s select and self-appointed “leadership” ignores the city’s serious problems while they embark another pointless road trip to another city, typically in the sunny South, to gather ideas on how they should proceed with their (how to describe?) “leadership.”

Just a week or so ago, about 160 of Richmond’s “leaders” were bopping around Tampa, sampling its eateries and noting the watery views. The biggest cheerleader for these junkets is The Richmond Times-Dispatch, which is very much a propaganda organ of the area’s chamber of commerce. Its publisher Thomas A. Silvestri was chamber chair a few years back yet few commented on the potential conflict of interest. On the Tampa trip, the editor of the editorial pages wrote a supposedly cute series of reports in a “postcard” (ha-ha) style about the Tampa trip. Here’s one tidbit:

“About 160 Richmonders will spend three days sipping from Tampa’s version of youth’s fabled fountain. Where oh where is the closest tiki bar?”

I couldn’t have said that better myself. Next, I’d like to copy what Virginiagal2 had to say in response to my blog. She absolutely nails it:

“The cost of sending a kid to Collegiate is beyond a lot of young families. What do you think those Richmond families value the most – a sports team that has around 5,000 people attend games, or a good safe public school for their kids? The RTD has been shilling for the stadium for months – when’s the last time the RTD advocated for money for better city schools? Do you ever remember them encouraging businesses to partner with city schools? Advocate for vouchers, yes – advocate for baseball, yes – improve the overall public schools, no.

‘nuf said.

Can Virginia Reverse the Stroadification of Rt. 1?

The Rt. 1 area under study. Click for larger image.

The Rt. 1 area under study. Click for larger image.

by James A. Bacon

People living along the U.S. Route 1 corridor in Northern Virginia seemingly desire contradictory things. They want better pedestrian and bicycle safety, they want mass transit. … and they want automobile traffic to flow faster. Alas, designing the corridor to move automobiles faster makes roads less safe, and it discourages the kind of development that would invite the higher-density, mixed-use development that would support mass transit.

Stewart Schwartz, executive director of the Coalition for Smarter Growth, explores the dilemma in a thoughtful two-part series (Part 1 and Part 2on the challenge of re-developing Route 1. His solution, at the risk of over-simplifying, is to switch the perspective from designing the corridor for cars to designing it for people. Planners are scheduled to submit specific recommendations for the corridor by July. If they focus on creating walkable, transit-oriented communities, Schwartz contends and I concur, automobile traffic flow will improve as well.

A few years back, the Virginia Department of Transportation proposed reducing posted speeds from 45 m.p.h. but an uproar ensued. Apparently, too many people depended upon U.S. 1 as a commuter route and imagined that lower posted speeds would translate into lower actual speeds and longer commuter time. But lowering the speed is critical to achieving the goal of walkability, walkability is required to make mass transit economically viable, and viable mass transit is required to reduce the volume of cars on the highway.

The problem is that U.S. 1 fits the classic definition of a stroad, a street-road hybrid. The route started as one of America’s first national highways. But Virginia state and local governments neglected to control access to the highway, with the result that it became cluttered with haphazard development, cut-throughs, curb-cuts and stoplights. Functionally, in Northern Virginia, Fredericksburg, Ashland, Richmond and Petersburg, the highway became a main street. Yet it failed to fulfill the functions of either highway or main street properly. The lanes were too wide and the speeds too intermittently high to create walkability or the higher-end development that is drawn to walkable places. At the same time, Rt. 1 became so congested with local traffic that it failed as a highway.

At some point, the people of Alexandria and Fairfax County must decide whether they want Rt. 1 fulfill its destiny as a highway or a street. It cannot do both.

Rt. 1 should be easier to salvage in Northern Virginia than in points south. There is so much demand in the region for walkable, transit-oriented communities that private investors should be able to re-develop the low-value development that exists now at higher densities fairly quickly. Proffers and/or impact fees, sweetened by higher density allowances, should be available to pay for streetscape improvements to make the corridor more hospitable to pedestrians. Further, there is such a large volume of traffic that the corridor should be able to support mass transit.

Transportation planners could help by reallocating right of way, in effect converting the former in-name-only highway from a stroad to a street. Reducing lane widths from 12 to 10 feet would free space for bicycle lanes and make the “highway” easier for pedestrians to cross. Yes, narrower lanes would slow the peak travel speed of thousands of commuters to Fort Belvoir. But if the narrower lanes were accompanied by less automobile traffic, lower posted speeds could be offset by shorter waits at traffic lights, less stop-and-go.

All urban Virginians should follow the Rt. 1 experiment with great interest. If Northern Virginia can find a workable solution for the old Jefferson Davis Highway, there is hope for the rest of us.

Columbia Pike Streetcars: Delving Deeper into the Value-Capture Scenario

by James A. Bacon

Last week, I made the case that the best way to finance construction of the proposed Columbia Pike street car line in Arlington was to set up an improvement district along the route and impose a real estate tax surcharge on property owners to pay off the bonds. (See “A Second Opinion on the Columbia Pike Streetcar.“) “If the property owners are willing to go along, it’s probably a good idea. If they balk, it’s probably not.”

In response, I received an email from Eric Balliet, a communications specialist with Arlington County. His email is worth reproducing in full:

Your concern that the County is not asking the primary beneficiaries of streetcar – property owners along the streetcar line – to pay for these improvements is not completely accurate. Local funding for the streetcar will come from the Transportation Capital Fund, which is used for major investments in transportation infrastructure throughout the County. The Fund is supported by a commercial real estate tax rate of $0.125 per $100 of assessed value. This tax rate applies to all commercial and industrial properties – including those along the streetcar line. Before the General Assembly provided this funding mechanism for jurisdictions to improve transportation infrastructure, the County used limited general tax revenue for that purpose, including for development of Metrorail in the Rosslyn-Ballston and Route 1 corridors.

The County also has established tax increment financing (TIF) to capture the property value created by redevelopment to fund streetcar and other priorities. The Crystal City-Pentagon City-Potomac Yard TIF is helping to pay for infrastructure improvements such as streetcar in support of the Crystal City Sector Plan. The new Columbia Pike TIF will dedicate up to 25 percent of tax revenue growth generated by new development and property appreciation in the commercial and multi-family residential revitalization districts to affordable housing along the Pike. This ensures that some of the money generated by streetcar will help meet our goal of preserving existing affordable housing along the Pike as property values and rents increase.

One final note – regarding the capacity of streetcar versus bus: Today on Columbia Pike, nearly 600 bus trips per weekday carry more than 16,000 passengers daily. Buses already come every 2-3 minutes in rush hour. Based on updated regional population projections and County-adopted plans, we need transit capacity of 38,000+ daily on Columbia Pike by 2035 to ensure it doesn’t become gridlocked. There is not enough street capacity for buses alone to accommodate that many passengers. A streetcar vehicle can hold 100% more passengers than a regular bus and 40% more than an articulated bus. Accommodating more people in fewer vehicles is key to keeping traffic moving.

I thank Balliet for educating me about the mechanisms being used to finance the street car line, of which I had been unaware. This information enrichens the debate. I must give the Arlington Board credit for recognizing that commercial interests would be major beneficiaries of the county’s roughly $300 million streetcar investment and for creating mechanisms that would capture some of the value created by that investment to lessen the burden on general taxpayers. That alone puts Arlington’s streetcar proposal way ahead of downstate mass transit projects, such as Bus Rapid Transit in downtown Richmond and a light rail extension in Virginia Beach, which have no value-capture elements of any kind. So, I toff my hat to the Arlington Board.

That said, while preferable to funding the entire county share from General Fund revenues, Arlington’s financing mechanism is still deficient. First, by imposing what amounts to a real estate tax surcharge on all commercial and industrial properties, the board is creating what might uncharitably be termed a slush fund for transportation projects which, by their very nature, benefit some commercial interests but not others. While the mechanism is fair to residential taxpayers, it is not necessarily fair to commercial property owners. Second, using tax increment financing (TIF) to tap 25% of the growth in property tax revenue generated by new development is largely a cosmetic measure. Columbia Pike property owners enjoy the blessings of higher leases and rents but don’t pay any more under this scheme.

To my mind, there are two important benefits to a strict value-capture financing scheme. One is that it is fairer, requiring beneficiaries of the public improvement pay for the improvement. Second, it creates an objective and non-political mechanism for weighing the risk-adjusted rate of return on the improvement. Let’s imagine that we set up a special Columbia Pike Streetcar District and tell property owners in that district (picking numbers for purposes of illustration), “We’re going to add a 25% surcharge to cover the full cost of financing construction of the streetcar and pay for operating costs not covered by fares. In return, you will get a streetcar system which, by our calculations, will bolster your rents and leases by 10% over time. There are uncertainties in all these numbers but we think we’re pretty close. Would you vote for or against this idea?”

If presented with this choice, the property owners would engage in a vigorous debate over the merits of streetcars and the assumptions embedded in the proposal, leavened by their own intimate knowledge of business conditions and property values along the route. Unlike planners, politicians and pontificators, they would have skin in the game. They would have the most to gain if the streetcar is a hit and the most to lose if it’s a bust. They, unlike politicians, would be likely to base their preference not on ideology but upon a keen awareness of the bottom line. They would be far less likely to engage in wishful thinking. If a significant majority of property owners agreed — as they did when they set up the special tax district to finance U.S. 28 improvements near Washington Dulles International Airport — then the public can have far more confidence that the project makes sound economic sense. That’s no guarantee, of course; businesses often bet wrong on investments. But they bet wrong a lot less frequently than do politicians playing with others peoples’ money.

One last note: Regarding for the carrying capacity of buses versus street cars, there is a lively discussion on an email thread initiated by Rob Whitfield. Has anyone considered the economics of running double-decker buses along Columbia Pike?

What Happened? Did All the Racists Move North?

Image credit: New York Times

Image credit: New York Times

by James A. Bacon

NewYork state has the most segregated schools in the country, according to a new report published by the Civil Rights Project at the University of California, New York State’s Extreme School Segregation.Other states with highly segregated schools include Illinois, Michigan and California.

“In the 30 years I have been researching schools, New York state has consistently been one of the most segregated states in the nation — no Southern state comes close to New York,” said Gary Orfield, co-director of the project, as quoted by the Associated Press.

Hmmm. How remarkable. What do those four states have in common? Here’s one thing. Their electorates all skew liberal and Democratic, as shown by the percentages that voted for Barack Obama in 2012:

New York — 62.6%
California — 59.3%
Illinois — 57.3%
Michigan — 54.3%

Bacon’s bottom line: Liberals have the loftiest of intentions. They pride themselves upon their enlightened racial attitudes and routinely malign their Republicans and conservative opponents as racist. But there is a vast gulf between intentions and results. It is no accident that the most segregated schools in the country are in blue states. Segregation is the unintended outcome of other “progressive” policies, particularly zoning, also enacted for the very best of reasons. (See Daniel Kay Hertz’ essay on the link between zoning and segregation in Chicago for how that works.)

The trouble with most liberals (not all, there are a few honest ones) is that they seem so incapable of self-reflection. Will this study prompt serious introspection and a wave of reform in New York? Will white liberals, struck by their massive hypocrisy, restrain their impulse to label as racist those who disagree with their policy prescriptions? Not a chance.

Most realistically, will African-Americans, traditionally a core constituency of the liberal/Democratic coalition, wake up and realize that their real enemies are not racists under every bed (like the phantasmagorical communists of the McCarthy era) but the ideology and practice of liberalism? I think that’s a distinct possibility.

The New West: Leaving Richmond Behind

Old Chesterfield bumper sticker mocks one from Henrico

Old Chesterfield bumper sticker mocks one from Henrico

By Peter Galuszka

This story may seem a contrarian piece when it comes to smart growth and exurban sprawl but so be it.

Back in 1969, road planners in Richmond came up with an idea for a superhighway, Route 288,  that would span the iconic James River and connect the far western suburban areas of Henrico and Chesterfield Counties, then primarily pine forests or dairy farms. The idea seemed to be to ring Richmond with a Washington-style Beltway and push growth farther away from the center city.

The scheme ran against some curious local snobbery – that of whether one lived on the north or south side of the James. The smug north side, of course, encompassed Richmond and its white ruling elite although many of them had moved to the West End or beyond to escape integration of schools.

Those living on the south side of the river were considered inferior, trailer park folk  whose uncouth views were more in synch with the Southside area of Virginia near the North Carolina border. Dixie would not mix easily with the assumed gentility of the Richmond folk, although southsiders had to drive to Richmond to see a doctor or do serious shopping.

Flash forward 45 years. Route 288 was finished about 10 years ago and despite the 2008 economic crash, it is quietly establishing its own upset of economic and cultural change and growth. It is linking Short Pump and its office parks and restaurants with upscale subdivisions in Chesterfield that boast of the highest income zip codes in the Richmond area. Capital One employees live at Foxfire. I explore this phenomenon in cover stories I wrote this month for the Chesterfield Monthly and the Henrico Monthly.

As George Hoffer, a transportation expert at the University of Richmond told me: “The West End and southwestern Chesterfield were going to grow independently. Then the highway did what public transportation can’t do. It provided links and created markets that didn’t exist before.”

And, as corporate relocations draw in more high-income workers from other areas, the old cultural biases are eroding. The newbies want convenience and could care less about Richmond’s ancient vanity about which side of the James one resides. Schools on either side of the river are comparable in quality, tests scores show. The north has more jobs and the south more houses, but that will shift over time.

Therein lies the rub. You have created a thriving exurban corridor that really doesn’t relate to the various and worthy land use ideals such as minimizing car traffic and creating bike trails. The most significant thing is that this outer corridor completely bypasses inner Richmond, its perpetual squabbling over over issues like a baseball stadium and its onerous 26 percent poverty levels. It doesn’t mean that the city is doomed to decay. Signs show more young people and retirees moving there. Unfortunately, however, low income ghettoes are stuck in a cycle of no jobs and inadequate transportation and the efforts of Richmond Mayor Dwight Jones haven’t produced many solutions.

The 288 phenomenon also is evidence that the cul-de sac ideals are not quite dead yet. Locating somewhere has long ceased being about white flight. The newcomers to the “New West”  include many people of color for whom Richmond’s racial animosities are more of an historical footnote. They may drive in to enjoy the city’s eateries and museums but choose not to live there and are hardly obsessed by what happened years ago.

So, Smart Growthers, you had better take notice. In some cases, the center city concepts you espouse are irrelevant.

Sprawl’s Hidden Subsidies

perverse_citiesby James A. Bacon

If planning and regulation were the answer to sprawl, then the Toronto metropolitan region ought to be a smart growth paradise. Toronto has a sophisticated, multi-tiered planning process, starting with an regional plan, plans for 30 upper-tier municipalities, and plans for 241 lower-tier municipalities (towns and townships, mostly). Yet outside the city of Toronto itself, which is undergoing a condo boom, there isn’t much to show for it.

The various municipal plans, which are comparable to Virginia’s comprehensive plans, define urban boundaries, control densities and show where growth should take place. The goal is for 40% of all new residential units to be built in already-urbanized areas. “That’s not happening,” says Pamela Blais, a city planner and principle of Toronto-based Metropole Consultants. “All the plans said all the right things. … [But] the regulatory approach isn’t sufficient to bring about the change.”

The failure of regulation to halt sprawling, auto-centric development was the basis for Blais’ 2010 book, “Perverse Cities: Hidden Subsidies, Wonky Policy and Urban Sprawl.” She had researched and written the volume to figure out how the planners’ plans had gone awry. If smart growth made so much sense, and if planners had the power to bring it about, why weren’t developers and home builders doing what they were supposed to do? Something else had to be going on, she reasoned, something that was not commonly recognized.

pamela_blais

Pamela Blais

As she delved into the subject, Blais found that real estate development is guided by massive hidden subsidies that shift costs from inefficient, land-intensive development to efficient, compact development. These invisible subsidies work at cross purposes to the regulations. As it turns out, developers follow the dollar.

Blais describes herself as a pragmatist. “It’s not an ideological argument I’m making,” she told Bacon’s Rebellion. “I’m interested in getting better cities. I’m happy to talk to everybody on the whole spectrum.” But her approach to urban development is one that fiscal and free-market conservatives can appreciate. The system for pricing public goods such as roads, water, sewer, electricity and public services bears little relationship to the cost of providing those services, she argues, with the result that a tangled skein of hidden subsidies incentivizes low-density development.

“Everybody thinks [sprawl] is the the invisible hand of the market. It’s a highly distorted market,” she says. “I’ve been arguing, let’s remove the distortions and take it from there. Remove the distortions and you’ll get a different development pattern. That should be the starting point.”

That is very much the argument that I have made in Bacon’s Rebellion, based largely on the work of EM Risse in his work, “The Shape of the Future” and essays published on this blog several years ago. Risse argued that charges do not reflect their “location-variable costs,” a succinct phrase that captures the spirit of Blais’ argument. In my reporting, I have focused mainly on one set of costs — transportation — but Blais carries the analysis to charges for utilities, municipal services, housing, parking and development charges as well. In “Perverse Cities,” she exhumed an impressive body of research to document her thesis across the board.

When you subsidize sprawl, you get more of it. When you penalize smart growth, you get less of it. To achieve smart growth objectives, Blais argues, what the United States and Canada need is not more regulation, which can create distortions of their own, but prices that reflect the underlying costs of development. 

Blais doesn’t oppose all subsidies. But she thinks they should be transparent and a subject of public discussion. “Right now, we’re not even having those discussions. People aren’t aware those cross subsidies are happening.” Here is a sampling from her book of how hidden biases are built into the system:

Water-sewer. Water-sewer charges typically are applied uniformly across a service area, regardless of how much it costs to provide the service. Sometimes charges vary by the volume of water; sometimes they do not. But charges rarely vary by the capital cost of extending water-sewer pipe longer distances to serve scattered, low-density housing, nor the operating cost of pumping water those greater distances. As a consequence, homeowners living in compact urban areas where the service is inexpensively supplied wind up subsidizing homeowners living in low-density areas where it is more expensive. Those subsidies could be avoided by breaking water charges into two components: a charge based on the volume of water consumed and a location-based charge that reflects the cost of building and maintaining the pipes. Continue reading