Housing in 'Smart Growth' Cities: Is It Really Worth The Cost?

Fascinating comments, Mr. Zilliacus. However, it is absolutely rediculous to say that design doesn't matter. Cabrini-Green acts the same as Greenwhich Village? I don't think so. If the failed modernist experiments of the 1950s-1970s demonstrated anything, it is that design matters TREMENDOUSLY.

The only reason that old areas like Greenwhich Village and new places like Kentlands don't have a good deomographic mix is because they are rare excellent places, and people love them. Since there isn't enough to go around, they cost a lot. As I said before, the solution is to build more of these places to satasfy the demand and the prices will come down.

The current situation where great urbanism is inhabited by wealthier demographic groups is a recent oddity created by the horrible condition of the urbanism of our generation. If we built new neighborhoods of the quality of SF's Marina District or DC's Georgetown then they would not cost so much. This unfortunate high cost of these places is not istitutionalized by policy or by their design. In fact, their design makes them MUCH MORE inclusive than modernist suburban monoculture development because different lot sizes and housing types are completely integrated, allowing different demographic groups to live together (if these great places weren't so darned rare and thus expensive). In conventional suburban development housing types and lot sizes are ruthlessly segregated, insitutionalizing the demographic segragation that you erroniously blame on traditional urbanism and New Urbanism. Also, these places don't require mandatory car ownership (at an average of $7,000 per year per car... min. of 1 car per adult) and thus have much more capacity for demographic diversity than suburban car-topias, Mr. Zilliacus.

The solution is more great places along the lines of Back Bay, Old Town Alexandria, Nantucket, Santa Barbara, Carmel, North Beach, etc. and the newer examples like Seaside and Kentlands. Once we have enough of them the prices will come back down to normal and their residensts can enjoy freedom from the economic burdens of mandatory auto ownership and the social pleasures of a diverse neighborhood that is alowed BY GOOD DESIGN.

So lift the freakin' ban on traditional urbansim already!!!! DESIGN MATTERS!!!!

And yes, in traditional urbanism the demographic mix can work well, even with the pesky poor people. Read "Death and Life of Great American Cities" for a glimpse into the workings of a diverse, dense, mixed use neighborhood before modernism, project planning, highway engineering, and suburban zoning had turned great traditional urbanism into treasured museum pieces that can only go to the highest bidder.

I’m not an urban planner, but since Richard Florida’s book “The Rise of the Creative Class” was released, I can’t help but take an intense interest in the issue, especially since I would be considered “gay,” “minority,” and probably “bohemian” to boot.

First, about Richard Florida’s book. While “The Rise of the Creative Class” has aroused great interest in the gay press, many have been perplexed by the seemingly way off the mark “gay index” Florida has devised. Naturally, San Francisco is at the top of the list, and no disagreement from anybody there, but some very undistinguished cities like Rochester, Sacramento, San Diego, and Orlando follow. Others, among them Denver and Atlanta, have actually gained notoriety as sites of active attempts to persecute and discriminate against gays and to roll back or prevent any freedoms they may have achieved. Surprisingly, New York, the country’s largest community, comes in 14th, well behind even Miami, which itself has a high profile, if over-hyped community in South Beach. Even so, both of these cities, according to Florida, rank as less gay than never-heard-of-it Rochester. This in spite of the very visible evidence that San Francisco, New York, and in very distant third, Los Angeles, are the most active and developed gay locales in the country, with the largest and most diverse communities, the strongest political influence, the most legal protection against discrimination and persecution, the greatest tolerance by the larger society, and the best bars, restaurants, nightlife, community centers, and other opportunities for community organization and social contact. New York and San Francisco in particular are two of the most admired gay locales everywhere in the world. From the 1970’s onward, New York has adopted a typically shrewd and pragmatic approach towards its gays and lesbians, recognizing their economic importance in the city’s ultra high profile design, restaurant, entertainment, publishing, tourism, and other industries, and accommodating them accordingly. The NYPD and FD have highly visible recruitment programs for gays and lesbians, and the mayor and senator are regular participants in gay pride festivities. Unfortunately Florida’s gay index is based on glitched 1990 census data. This data counted only gay male couples, which if you’re familiar with the community, is not really a good measure of gay quality of life, and it did even this poorly. Other surveys have simply asked gay men and lesbians which cities they regard as most accommodating for them, and while San Francisco usually emerges on top, Rochester and Sacramento are almost “never heard ofs”. I would think similar results would prevail with artists, musicians, and other “bohemians,” who are attracted to cities based on the reputation of their arts and music scenes.

Second, Mr. Carson, you may want to refrain from making disparaging and poorly-informed remarks about minorities and gays. With four children, there is statistically an above average chance that one of them is gay, and it is also likely that there is at least one gay person, overt or not, numbered among your relations already. No one is “promoting” a gay lifestyle to anyone who isn’t already gay, any more than the larger society is “promoting” a heterosexual lifestyle. Believe me there is no way any amount of propaganda is going to have any influence on the decision to be straight or gay simply because it isn’t a decision. The best that can be done is to make life safer for gays, to end legally sanctioned discrimination against them, and to make the process of accepting one’s own sexual orientation less painful. Gays do not want anything less than the rights and freedoms that you enjoy by default.

I think we do have to thank Mr. Carson’s rather strident remarks, however, for making explicit some aspects of suburban sprawl that Mr. Cox, Mr. O’ Toole, and the other champions of suburbia would rather like to gloss over; which is that the sprawlvilles of America have turned out to be the major sites for prejudice, intolerance, and unfreedom in our society. In many cases this prejudice has lapsed into legally sanctioned bigotry against what has long been one of society’s most harshly oppressed and vulnerable groups, lesbians and gays. This has resulted in numerous attempts to limit individual freedom through intrusion on people’s intimate lives and the forcible imposition of collective moral standards that are anything but laissez-faire. Though these assaults on freedom affect many people, and not just lesbians and gays, I’ll focus mostly on them as they are relatively easily documented:

In 1998, two men in sprawling Houston, Texas were subjected to police officers invading their residence. The men were then arrested for having consensual sex in their own bedroom in their own home, under its “Homosexual Conduct Law.” The case is still pending. More recently, an anti-gay bal

There are a few isolated examples of smart growth projects (i.e. new urbanist projects) that provide and preserve affordability. These projects do not involve HUD, and may serve as a model in some communities. They may serve as model to address the legitimate concerns raised by Mr. Zilliacus. One such example can be found in Chaska, Minnesota.

Chaska is a small city of 17,000 approximately 20 miles southwest of the twin cities of Minneapolis and St Paul. Throughout the 1980s and 1990s, developers in Chaska often built $400,000 homes on 100-foot wide lots in neighborhoods with cul-de-sacs. The prevalent low-density vision made no allowance for low to moderate-income housing.

In 2000, the community established a markedly different direction by adopting a smart growth comprehensive plan requiring development to abide by new urbanist design principles that produce walkable, mixed-use, mix-income neighborhoods. This plan includes five planning precepts that all developers must follow: 1) Neighborhoods have identifiable centers and edges. 2) The most important and visible property in a neighborhood is utilized by some public use (i.e. public buildings, parks, and plazas). 3) Neighborhood size is limited by the distance from the center to the edge, generally a five to 10 minute walk (1/4 to ½ mile radius). 4) Neighborhoods consist of an integrated network of walkable streets. 5) Neighborhoods contain diversity in land uses, building types, building sizes, building styles, and styles of ownership.

When the city’s planners studied other greenfield smart growth (i.e. new urbanist) communities, they noted that the affordable housing issue had generally not been adequately addressed. Based on further research and discussions with planners elsewhere, the planning department engineered a solution to this pressing problem based on the use of the density bonus, community land trust, and rental subsidies from upper levels of government.

Since the plan’s adoption, two major projects have gone through the review process. In each case, developers had to approach the city with a concept plan that satisfactorily demonstrated how they were going to implement the appropriate sections of the comprehensive plan prior to receiving zoning entitlement. The details of a plan were worked out in the context of a planned unit development agreement. Density bonuses were used to encourage the production of affordable housing.

A key point made by Chaska’s planners is that the city enters these negotiations with sufficient leverage to get site designs that not only abide by the comprehensive plan’s clearly articulated planning principles, but also produce substantial amounts of affordable housing. These negotiations work well only because of the consistent support for the plan on the part of Chaska’s elected officials.

In the first major project approved under the 2000 plan, 330 of the 990 residential units are affordable to households making 80 percent of the median income. Chaska’s second major project, which is based on a weeklong design charrette done by Calthorpe and Associates, has a similar percentage of affordable units. In order to preserve affordability, the city established the Chaska Community Land Trust. The city and its partners in the private and non-profit sectors endowed the Trust. Over time, the Trust plans to increase the size of its endowment through fundraising activities. Chaska’s approach to affordable housing provides a model other communities can turn to when looking for ways to approach greenfield development in an inclusive manner.

European countries have proven that you can maintain a high standard of living while preserving agricultural land and open space. Germany, with a population of 85 million in a country slightly smaller than the state of Montana has beautiful, liveable cities and a pastoral countryside with farms and forests that put this country to shame.

Had they taken the post WWII American approach to development their country would be one giant automobile slum covered in subdivisions, mobile homes, strips malls, and fast food restaurants. Instead they realized that there is a limit to property rights, that the individual doesn't own the land in perpetuity and the gains from short-term land use policies don't outweigh the long-term costs in damage to the landscape and society.

Like it or not the future of this country and the world is going to be very different than the last 50 years. Americans, as a nation, have a lot of growing up to do. From our noble, austere origins we've become a society of spoiled children who don't want to admit culturally toxic and unsustainable the American way of life really is.

Mr. O'Toole brilliantly brings up a subject that is not often understood among most people and is generally ignored by politicians and planners, two groups which should be most concerned about these trends but appear to like the status quo of unaffordability.

The point here is that the basic tenets of Economics 101 cannot be ignored in a capitalist economy like ours. There is a certain supply of housing and land on one side and there is a certain demand of willing buyers on the other.

Back in the 1940s, 50s, and 60s, we willingly built new housing for whoever wanted it. Housing was affordable for those in the middle class and even those in the working classes. Most people wanting to buy a house could do so on a single income (more the norm in those days) and could expect to spend the standard of 30% or less of gross monthly income on housing.

Fast-forward to the 1990s and early 21st century and you come to a country with a myriad of land-use restrictions, government regulations, and environmental laws. The relatively few (compared to demand) housing developments that are able to get through the government red tape are only able to do so after having to pay large impact fees, open space donations, and meet "affordable housing" requirements. The result? The remaining homes have to be sold at higher market prices and tend to be larger due to the need to maximize the relatively scarce land available.

The argument that open space is crucial to the quality of life of residents ignores the fact that this open space is not free. The cost of the open space is figured into the cost of the homes and their underlying land. This raises the price of each housing unit and ensures that only the wealthy and upper middle-class will be able to afford these homes.

If the people in these developments are willing to purchase the open space at fair market value (what the land could fetch if it could be developed), then that is OK. The problem is that existing homeowners in a Phase I development often want to stop the Phase II development without adequately compensating the land-owner, the developer, the full market value of the property. That is stealing, no matter what nice environmental label is put on it.

The American Dream, one's own single family house (or any owned property for that matter) is rapidly fading away. Even houses in the blazing deserts of Las Vegas and Phoenix are rapidly becoming unaffordable.

If we continue these policies, this nation faces a situation much like what exists in Third World Nations--a relatively small wealthy group of people owning (or controlling through open space laws) most of the land while the rest of us live in substandard shanty type housing in just an effort to survive.

All of a sudden those large open spaces become less valuable when measured against the potential homelessness and human suffering that will result. Its something to consider before the standard of living in the United States deteriorates to the level of much of the rest of the world.

Don Hagstrom

Friends of Southern California's Highways

At last, scientific data.

Mr. O'Toole said "Land-use regulations are strong in the San Francisco-Oakland and San Jose areas, in Oregon, Boulder, Massachusetts, and Maryland. Cities in these states and urban areas have the highest housing prices. Land-use rules are weak in Nevada, Arizona, Idaho, and Wyoming, and cities in these states have some of the lowest housing prices."

As we all know housing prices are ultimately driven by the demand to live in a particular area. That demand is driven by a combination of economic, cultural, and aesthetic concerns. In San Francisco its a combination of the natural topography of the bay area, the architectural history that gives it a strong sense of place, along with a diverse, creative culture that is politically progressive and tolerant of different points of view. The economic phenomenon that results from this is what professor Richard Florida dubs as the 'Creative Class'. They are the creative individuals who produce software, media, and architectural designs. They are the top 20% of the population that generates the new ideas that fuel the information economy.

In a Salon interview Mr. Florida stated that creative cities require the following:

"My theory uses the three T's: technology, talent and tolerance. You need to have a strong technology base, such as a research university and investment in technology. That alone is a necessary but not in itself sufficient condition. Second, you need to be a place that attracts and retains talent, has the lifestyle options, the excitement, the energy, and stimulation that talented, creative people need. And thirdly, you need to be tolerant of diversity so you can attract all sorts of people -- foreign-born people, immigrants, woman as well as men, gays as well as straights, people who look different and have different appearances."

All the places Mr. O'Toole criticized: San Francisco Bay area, Oregon, Boulder, Massachusetts, and Maryland fall into this category.

The places he praises as beacons of 'affordability' due to minimal land use regulation, Nevada, Arizona, Idaho, and Wyoming, fall into the opposite category. All are landlocked and located quite a distance from the major coastal population centers. Nevada, Idaho, and Wyoming are largely rural in character due to low populations (ranked 35th, 39th, and 51st respectively) and benefit greatly from federal subsidies for rural infrastructure improvements such as roads, water, communications and power generation effectively paid for by taxpayers in other states. They have large tracts of open land available which makes property cheap, but for the most part that are completely lacking in the cultural amenities that make the other areas so desirable to consumers and businesses.

Thus the negative aspect of housing affordability in places like San Francisco, Portland, Boston, and Boulder is largely due to demand to live in an area with unique cultural offerings with a finite amount of space and housing, that is to say it is driven by the very market forces that Mr. O'Toole as a libertarian should be defending. It seems to me the answer would be to create more of what is so desirable, that is use land efficiently by designing real neighborhoods geared towards the creation and needs of a real community.

Mr. O'toole’s solution to the problem is that they should imitate lesser cities like Las Vegas and Phoenix by adopting sprawl producing, minimal land use regulations. That is, adopt a pro-growth platform heavily subsidized by government tax dollars that creates an illusion of economic affordability while ignoring the external costs.

However in typical libertarian fashion Mr. O'Toole ignores the external costs by pretending those costs which the market don’t accurately account for, don't matter.

Perhaps he should consider factoring in the costs of mandatory car ownership (on average $6,500 per year per vehicle for gas, insurance, taxes, maintenance, and loan payments) into your equation. For a family of four living in the suburbs two cars are a must and it is not uncommon for such families to spend as much or more on car ownership costs as they do on their mortgage.

There's also the issue of time spent commuting to and from work. What is the upper limit on how far an individual can drive before the resulting time commitment makes the situation unlivable? In cities like Atlanta, all the newly constructed so called 'affordable' housing is located in the far flung suburbs 30-40 miles from downtown. Combined with the horrible traffic congestion due to diminishing returns from so called 'investments' in highway infrastructure this translates into roughly 2-3 hours a day spent driving in order to commute to a job in the city proper. This effectively creates a 12 hour work day leaving little time to spend doing other things.

O'Toole makes the same old argument that the real estate lobby keeps making again and again: land use regulation increases housing costs, therefore smart growth increases housing costs. This argument rests on an assumption that all land use regulation = smart growth and vice versa.

But this equation is just flat out false, because most supply-restricting housing regulations create more sprawl rather than more smart growth: minimum parking requirements that essentially subsidize driving (and ensure that scarce real estate is used for parking rather than housing), minimum lot size requirements that force houses so far apart that everyone must walk everywhere (and reduce the supply of houses in a given area), single use zoning that forbids housing within walking distance of shops, the impossibility of building ANYTHING near a transit station thanks to NIMBY opposition, etc. (By contrast, statewide urban growth boundaries, which presumably are O'Toole's idea of iniqitous "smart growth regulations" are virtually unknown outside Oregon, Washington and Tennessee -- areas that, as O'Toole's OWN TABLES point out, are not the most expensive areas in the nation). I find it incredibly curious that O'Toole devotes his life to fighting an extremely rare type of regulation (growth boundaries) but doesn't waste his time on the more common, anti-walkability regulations that infest this nation like a plague.

I also find the remarks of O'Toole's so-called supporters curious. Scott Carson writes: "I do NOT want to live in some 'diversity' community" (English translation: no black people). Yet O'Toole claims to want MORE affordable housing, which presumably means less segregation by race and class. Does Carson understand something about O'Toole's arguments that I don't?

Of course, many of O'Toole's supporters in the sprawl lobby want anything but affordable housing: they want Big Brother to build roads to create more lily white suburbs, allow just enough of a free market for developers to build more lily white suburbs -- and as soon as the bulldozers start running, out come the exclusionary zoning rules to keep the riffraff out!

Once again, the Reason/Thoreau/Public Purpose "think tank" spin complex churns out another piece of literature that conveniently ignores many facts that do not fit into their worldview.

Nowhere in this article does O'Toole address how in areas that eschew Smart Growth principles in favor of sprawl, transportation choices are far more limited, and transportation costs are much higher for households. In most cities, housing and transport costs are a tradeoff.

To see how cities with higher degrees of sprawl exhibit greater transportation costs of a percentage of household income, view the Surface Transportation Policy Project's 2000 Report: "Driven To Spend."

http://www.transact.org/PDFs/DriventoSpend.pdf

Why is this important? Simply put- investing in housing builds equity. Investing in cars does not. Any time households continually expend a larger and larger portion of their income on automobile costs, they reduce their ability to save.

O'Toole's most likely rejoinder to this idea is that if we herd everyone into smart growth developments, bid rent for these properties will make them unaffordable for entry-level buyers. Here, I share O'Toole's concern. The housing affordability issue is one the Smart Growth movement needs to grapple with more than any other to achieve its goals.

However, the irony of this and other positions typical of this portion of the smart growth/sprawl discussion is that they are not vocally in favor of the (LEM) Location-Efficient Mortgage promoted by the Center for Neighborhood Technology, which is a market-based approach to recognizing that those who choose to live in areas with high levels of walkability and transit access will flush far less of their income into the money pit of a car, which can then be redirected into a larger monthly payment for housing, which builds equity. Find out more about LEMs here.

http://www.cnt.org/index.cfm?FuseAction=Project&ProjectID=1

The LEM seeks to re-invigorate the stale and un-entrepreneurial lending industry which no longer has any creative ability to fund things that do not follow a few narrow formulas for residential development.

O'Toole and his ideological compatriots, if they were really about market-based solutions, would jump on the LEM bandwagon for appropriate areas in cities. The LEM is not relevant for suburban sprawl areas, but for many inner city residents who do live in transit supportive communities and are low-to-moderate income, it could definitely assist in the leap from renting to ownership.

Although national affordable housing organizations such as LISC and the National Low Income Housing Coalition support smart growth , there remains some confusion over fundamental issues pertaining to smart growth and affordability. Much of this confusion is generated by reports published by “market-oriented” organizations such as the Heritage Foundation, Reason Public Policy Institute, and Mr. O'Toole's Thoreau Institute.

These organizations believe land use decisions should be made by the market and not comprehensive planning and public input. In their efforts to discredit the concept of growth management, have publish numerous reports linking public policies with higher housing costs.

In response to these claims, the Brookings Institution undertook a study that examined all peer-reviewed scholarship done to date on the subject of affordability and growth management. Their review found no link between affordable housing and growth management per se. The study’s authors note that it is simplistic to talk about growth management and affordability in general terms because there are so many variations in the way growth is “managed.” They also distinguish between “land use controls” and “growth management”. A fundamental purpose of land use controls is to exclude undesirable land uses from coming into communities. In many communities in America this translates into exclusionary zoning to keep out low-income households, African Americans and Latinos. The premise underlying growth management is to regulate land use in ways that do not result in social exclusion.

Mr. O'Toole's editorial reflects a simplified view of the modern world - borne out of a specific ideological orientation. His editorial takes away from a genuine discussion regarding affordable housing in functional communities (i.e. not warehousing the poor as has largely been the case in the past.)

I don't typically share Mr. O'Toole's point of view, but it appears that plenty of experts and the national court of opinion is agreeing with him. Yesterday's cover story in USA Today(!) basically supports -- albeit in a less technical fashion -- exactly this argument.

Anti-sprawl fervor meets backlash

http://www.usatoday.com/news/nation/2002-08-25-smart-growth_x.htm

"Experts are laying part of the blame on the anti-growth fervor sweeping the USA, a trend that has led to building moratoriums and preservation of large chunks of open space."

Bill Fulton and David Goldberg of Smart Growth America are quoted.

Kudos to Planetizen for being on top of this issue!

I have heard variations on this arguments for years and I don't buy it. I have worked in both Nevada and California and you cannot compare the two in any meaningful way. In my opinion you cannot even compare different parts of California to each other meaningfully. First major differance, land. California's land is largely in private hands (excluding the sw desert) with an active real estate market for ag land. Nevada's land (and AZ, AK, ID, WY, UT ect.) is largely in federal hands and over the last 10 years the feds have sold off thousands of acres of land for development around LV. Additionally thier is no competing uses for land in NV, AZ ect. Ag is confined to cattle ranching, which is cheaper to do on federal land (AUM pricing is a whole other issue) then on private land. Result the land prices in NV. are atifically low. The same holds true for water, in some cities the Feds or the state have supplied the water virtually free (LV, LA, PHX) while in other cities the residents have to pay for it themselves (SFO, Reno, Tahoe, ect.). Then you have the costs of roads and schools which are borne by the home owner in Ca. and by the state (though gaming taxes) in Nv., big differance there.

In short you cannot compare one city to another unless you compare all of the factors that influcance land and home prices.