Lakeside 2014

Eben Fodor presented at Flower Mound's First Open Space Symposium in 2000

"Growth for the sake of growth is the ideology of the cancer cell".  - Edward Abbey

"Better not Bigger" by Eben Fodor  (excerpts)

 

 Chapter 2: "The Urban Growth Machine"

          "Local democracy has been dominated by growth coalitions composed of individuals and enterprises with a direct stake in real estate development". - Harvard economist and public policy and planning professors Allan Ault Shuler and José- Gomez Ibanez, Regulations for Revenue.

          The concept of an urban growth machine helps make sense of the various political and economic constituencies that act in their common financial interest to perpetuate growth in a typical city.

          The engine of the growth machine is powered by the fortunes resulting from land speculation in real estate development.  The primary business interests are the landowners, real estate developers, mortgage bankers, realtors, construction companies and contractors, cement and sand and gravel companies, and building suppliers.  While these various players may disagree on some issues, they all have a common economic interest in promoting local growth.  They tend to be wealthy, organized, and politically influential and most communities.

          Many of the members of these groups are organized into local and regional associations to more effectively represent their business interest: the Chamber of Commerce, Association of Realtors, Homebuilders Association, and so forth the regional associations may, in turn, be part of powerful national organizations.

          The store owner who hopes for more customers may be forgetting that growth also brings some very tough competition.  The small, locally owned businesses are likely to be casualties in the competition growth brings.  The bigger local companies however are likely to do well at the top of the economic food chain.  These larger businesses also tend to dominate the local chamber of commerce is pro-growth policies.

Local government becomes part Growth Machine

       Pro-growth business interests influence the local government to improve the profitability of local and development.  Local government can affect profitability by:

          - Increasing the intensity of land use (rezoning or annexing land)

          - Reducing the cost of development (reducing regulation, fees, and delays)

          - Diverting public resources to support local land development (and new roads, sewers, and other facilities) stimulating the demand for new development (economic development programs, tax incentives, and other subsidies).

          Sociologist and Political economist Harvey Molotch says the primary objective of the pro-growth coalition is to divert public resources into growth inducing investments.  The benefits flow to the few while the costs (congestion, quality live, higher taxes) are spread among the many.  Thus, according to economist Paul Huszlar and David Seckle: "Both the distribution and the quality of benefits and costs tend to create a powerful, tightly integrated, and well-financed minority of beneficiaries opposed to a loose knit, poorly financed majority of losers.  The outcome in the political process is a relative superiority of the pro-growth faction."  Oregon environmental leader Andy Kerr has called our urban growth a " pyramid scheme in which a few relatively few make a killing, some others make a living, but most others pay for it."

          The growth machine is functioning very effectively in most American cities.  It tends to push citizens out of growth policy issues and is often a powerful force in funding local political campaigns in fighting citizen ballot initiatives.  It works steadily to ensure that a majority of elected officials are growth friendly.  And it aggressively diverts public attention away from the negative environmental, social, and economic consequences of growth with claims that growth "makes jobs and provides affordable housing."

Accessories to the Growth Machine

          Local newspapers may see growth as a way to increase circulation and bring new advertisers.  The paper may also want to stay on good terms with the real estate industry due to the large volume of real estate ads most papers enjoy.

          Community planners - primarily focused on accommodating growth.  They are often less than enthusiastic about policies that might actually slow growth.  The fact that the planning profession depends so much on growth creates a bias away from restraining growth and toward channeling or shaping it.  Other professionals may include architects, landscapers, engineers, surveyors, interior decorators, home inspectors, appraisers, and even wetlands consultants.

          The urban growth machine is a uniquely local phenomenon.  It may be strong and powerful in some cities and weak, or nonexistent, in others it functions primarily at the local level, but also forms coalitions to influence statewide policies.

Using Democracy to Control the Growth Machine

          Unfortunately many local governments are thoroughly entwined with the narrow, special interest of the growth machine.  The control of local government by special interest is, of course, inconsistent with the principles of democracy.  The solution is better government.  As HL Mencken once said, "the cure for the ills of democracy is more democracy."  The government should be dedicated to serving the broader public interest of the community it serves.  It should be open, accountable and accessible to all citizens.  It should seek to keep its citizens informed and actively involve them in public policy development.  It should provide accurate, complete, and balanced information to policymakers and the public.  And it should embrace the principle of 'government of the people, by the people and for the people."

          Actively encourage public participation.  Simply running an ad in the paper announcing a public hearing may not be enough.  Restore citizen balance to public land use policy making.  In many communities the concept of balance has been distorted to such a degree that local land use" Citizen Advisory Committees" are composed almost entirely of so-called" stakeholders" - people with a direct financial interest in the outcome.  A more representative citizen advisory committee would be composed entirely of volunteers from the community who are all financially detached from the outcome of an issue.  The committee can invite vested interests, our stakeholders, to participate in nonvoting capacity.

          Form a grassroots organization. An organized presence to represent the general public interest in growth in land development issues can be very effective. 

          Get the money out of politics.  Requiring full disclosure of contributors is basic to restoring democracy to local politics.

          Hire a public advocate for land use in planning. This helps balance a process that is typically dominated by the developer's attorney and other hired consultants.  Unlike most citizens, a public advocate can devote full-time to public interest representation.

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          The weakest support for growth management is likely to come from the wealthiest segment of the population and for members of the organized business community.  The survey showed strong support for slowing growth by every cross-section of the population except one- members of the Chamber Of Commerce.

          Urban growth occurs incrementally, one office building or subdivision at a time.  As a result is often difficult for people to recognize the adverse impacts growth may be causing their community.  It can be even harder to respond to this incremental growth with the kind of major policy initiatives that may be necessary to protect the community from these impacts

          Boulder Colorado residents do not want their town to become the size of New York so they became proactive and developed some of the best growth controls of any US city…. reducing or eliminating growth subsidies will relieve some of the growth pressure in your community and can result in a more equitable use of public resources.  Approaches to growth management have the potential to moderate or restrain growth (slow it down) rather than accommodate it.  These approaches are generally referred to as growth controls rather than the broader term growth management.

           Surveys indicate that most people do not support growth subsidies that are ultimately born by taxpayers.  Adopting growth neutral policies is a way to get local government out of the business a stimulating growth.

           There are also private sector growth inducements among which speculative development is chief.  A developer embarks on a project based on his or her speculation that there is a demand for a certain kind of development-- an office building, industrial park, or residential subdivision.  These developers gamble substantial investments, assuming they know the market and can predict the demand for their product one or two years in the future.

          Speculative developments are often the last thing the community needs all too often the result is a big new office building with no tenants or subdivision without homebuyers however by the time the project is completed the developer and the banks and finance the project are heavily committed to success they will go to great lengths to market the project to potential tenants or buyers all over the country.  These promotional campaigns are also taken up by the local economic development agency, the Chamber of Commerce, the local tourism department and sometimes even the city's planning and development Department.  The net effect of all this promotional hoopla is more growth, requiring more subsidies.

          In the US, the authority of local government to regulate growth comes from the 10th amendment to the U.S. Constitution which grants states the police power to regulate themselves.  The same source of authority is used to enforce local zoning and building codes and armor for regulations.  It is the right and obligation of the community to protect and promote public health safety and general welfare of the public.  The US Supreme Court has consistently supported the right of communities to enact reasonable regulations for this purpose.  The right to protect the health, safety, and welfare goes a long way and even includes matters of aesthetics…. growth controls are frequently challenged by development groups.

          Occasionally there are statements that growth controls are elitist policies enacted by rich white communities.  But the survey of growth measures in all of California's 443 cities and counties show no racial or income class pattern in the enactment of the many growth controls in the state communities with growth controls to tend to have better educated residents.  However cities that have active growth controls also enacted more affordable housing incentives than cities without growth controls.

          When there are strong growth pressure, growth controls in the community may force growth into another nearby area where such controls don't exist.  This is one of the strongest arguments for using a regional approach to growth management.

Development Impact Fees

          Development impact fees are an increasingly popular means of funding the many types of public infrastructure required by growth.  At least 18 states have now adopted enabling legislation that specifically authorizes local governments to collect these fees.  Developers often argued impact fees increase the cost of housing.  This can be misleading since all the costs associated with housing remain exactly the same.  The question is who pays for them.  Impact fees should move the cost burden from the general public to the new homeowners who receive the benefits.  Thus, impact fees are matter of economic fairness and equality.  The potential benefits of impact fees include: lower taxes, better market price signals, and incentives for good development.

Setting standards for growth

          What important characteristics and qualities of your community are threatened by growth?  Threshold standards and performance standards are two forms of growth standards (such as environmental and quality of life standards). 

Boulder, Colorado Leading by Example

          In 1967 Boulder voters approved one of the nation's first locally funded greenbelt systems.  They used a local sales tax increase of 0.4% to finance open space on land acquisition.  As of 1998 Boulder had raised $116 million and acquired 33,000 acres of green space and mountain parks.  The greenbelt system serves as a natural growth boundary, defining the limits of the city with open space parkland.  This natural boundary helps to block urban sprawl and" leapfrog" development.  The greenbelt has also helped protect the quality of life in Boulder as the city has grown.  It is said that more people used the greenbelt system each year than visit nearby Rocky Mountain National Park. As an added measure, Boulder established a building height limitation of 55 feet in 1971 to preserve the view of the Rockies.   The city and surrounding county have cooperated on planning and growth management policies and jointly adopted The Boulder Valley Comprehensive Plan.

 Adequate Public Facility Requirements

          Concurrency requirements are intended to ensure the public facilities are in place as new development occurs.  Such requirements seek to protect existing residents from declining levels of service, overloaded facilities, and increasing debt resulting from the demands of growth.

 Urban Growth Boundaries and Greenbelts

          UGB's can be very effective in controlling urban sprawl... and contribute toward a more orderly development of urban areas, with lower cost to provide urban services, and protection of rural lands.  John Fregonese, former chief planner at Metro, Portland, Oregon area's regional government, estimated other cities will also establish UGB's as they realize they are rapidly using up the one thing that nobody is making more of, and that's land".

Community Impact Statements

          There is often a lack of critical information about which to make informed decisions about the possible impacts of a particular development.  In the case of some large developments, the impacts can affect the whole community.  Community impact statement (CIS) is a means of evaluating these impacts and informing the public before developments are approved.

 Infrastructure Spending Restrictions

          In 1997, Oregon Governor John Kitzhaber … threatened to stop construction of new roads until the state Legislature developed a means of funding maintenance of existing roads.  This action was based on prudent fiscal policy; we should not be building new facilities when we can't afford maintain the ones we already have.

Limiting Speculative Development

          In the late 1980s the commercial real estate market in many cities were readily financing speculative development projects (projects without known tenants or buyers) with little regard for market demand.  But the construction frenzy cause office space markets to over build...  US taxpayers ended up paying the bill for much of this reckless speculation and hundreds of savings-and-loan institutions went under… this led to tougher lending policies requiring that 30 to 50% or more of the proposed office space have a rental contract before financing would be approved.  Communities may be able to use the same approach to temperate the enthusiasm of speculative development with market realities.  For example a requirement that a minimum percentage of the proposed development be pre-leased or presold before building permits are issued.  An independent market analysis could also be required as part of the approval process.

Carrying Capacity Limits

          Carrying capacity reflects the ability of the environment to support a given species of plant or animal based on limiting factors such as water, nutrients, forage, and so forth.  This biological concept has more recently been applied to human settlement.  In this context, the carrying capacity is the maximum number of people the land area can sustain over the long-term… in many areas of North America the levels of groundwater have been steadily declining as water is withdrawn faster than it is being recharged.

Preserving Undeveloped Land

Public Land Acquisition, Conservation Easements, Purchasing Development Rights

          Considering the high public costs associated with land development public acquisition of land for conservation or other purposes can often save local taxpayers money.  A 1991 study found that the town of Yarmouth Maine would incur a cost of $140,000 annually if a certain parcel of land were developed.  By purchasing the land the town's annual cost would only be $76,000.  The same study reports on a parcel in Huntsville Alabama that is developed, would have infrastructure costs of $5 million and annual service costs of $2500-$3000 per acre.  By contrast acquisition would cost only $3.3 million in annual service costs or $75 an acre… Housing was found to cost the local government more in ongoing services than it generated in tax revenues.

Community Land Trusts

          Private, nonprofit land trusts are a popular and highly successful means of conserving land.  They've been created to protect land from development, to preserve farmland, to create low- income housing, and for other purposes.  The land trust simply acquires land in and puts it to the use for which the trust was created… the number local land trust has grown from 535 in 1985 to more than 1100 in 1998.  Land trusts are operating in every state of the US.

Open Space Requirements

          Some communities have adopted a requirement that all new development provide a certain amount of open space or undeveloped land.

Conservation Tax Incentives

          Tax incentives can be used to encourage landowners to protect their land in certain ways by setting lower property tax rates for farms, forest, or open space land.  By lowering the tax of undeveloped land there is less economic pressure for the owner to sell or develop the land.  The opposite technique of heavily taxing land, but not buildings can be used in developed urban areas to encourage greater density.

Gaining Public Support for Growth Controls

          The implementation of any kind of growth management depends on having the necessary political support, or better yet, a public mandate to carry it through.  You might be surprised to know that most people support growth management.  Citizens need better information about growth impacts, future growth projections, and positive alternatives to more growth-as-usual.

          Support for growth management is likely to be strongest in high-growth areas where people are experiencing the impacts of growth-up close and personal.  Public preference for growth management causes all demographic lines.  Results are fairly consistent across age, income, gender, ethnicity, and education levels.  The weakest support for growth management is likely to come from the wealthiest segment of the population and for members of the organized business community.  In 1996 survey conducted by the city of Eugene, Oregon polled residents on the preference for various growth-management options ranging from promoting growth to discouraging growth.  The survey showed strong support for slowing growth by every cross-section of the population except one- members of the Chamber Of Commerce.