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Month June 2008

EcoDensity: Scary Name, but Not-so-Bad

Vancouver’s City Council has approved an “EcoDensity” policy. How is EcoDensity different from regular density, which already comes pre-equipped with environmental benefits? Well, its just an environmental-sounding catch-prefix and comes with less bureaucracy for green developments. Planetizen – EcoDensity Approved in Vancouver Amongst the additional actions, Council has approved in principle the development of bylaws that could allow lane-oriented housing (coach houses and apartments above garages) potentially throughout the city (what we’ve called “hidden” density); new secondary suite options in every housing type (what we’ve called “invisible” density – Vancouver currently allows one secondary suite in single-detached housing, but not in other housing forms such as rowhouses and apartments); exploration of new mid-rise building typologies and associated zoning; a new “Green means Go” priority approval system for exemplary sustainable projects; the removal of numerous existing regulatory disincentives to green design approaches; EcoDensity demonstration projects on city-owned land; the development of new amenity and services funding tools to support quality density; and so on. One action in particular will represent the culmination of much of our thinking – the development over time of a new EcoCityPlan, respecting and building on the highly successful and influential CityPlan developed in the mid-90’s with incredible public engagement. It’s interesting how they are able to make an environmental case to make the bureaucratic approval process not seem so bad. “Hey, if you make it green, we’ll actually try not to slow you down as much as we usually do.” Why can’t all projects be given a speedy approval process? All-in-all, this seems like a good example of how market liberalization (while only incremental here) can be made to appeal to typically anti-market progressives. I guess all you have to is add the “Eco” prefix. How about “EcoProfits”, “EcoTrade”, “EcoPrivatization” or “EcoTaxCut”?

Socialist Cities

So, you think the planners in your area are taking something a little too far? Be glad you aren’t in Venezuela… I wish I could link to the article by Michael Mehaffy in The Urban Land Institute’s May edition of Urban Land titled “Venezuela’s New Socialist Cities”, but ULI doesn’t provide the online edition to non-members. However, I have been able to find some related articles online, which I can share with you. Development of Caminos de Los Indios, the first of five “Socialist Cities” has begun south of Caracas. In his 2007 inaugural speech, Hugo Chavez said, “We need to a system of cities based on federations, federal regions. We need to build communal cities, Socialist Cities.” “Economic power needs to be transfered to these local bodies (“councils of popular power”) – so that we can work toward the communal and social state and move away from capitalism.” The concept is tauted by the government as a way of empowering locals and creating sustainable places for the 1/2 million residents. In Nov 17, 2007’s Washington Post, Ramón Carrizales, Venezuela’s housing minister is quoted “A city that’s self-sustainable, that respects the environment, that uses clean technologies, that is mostly for use by the people, with lots of walking paths, parks, sports areas, museums and schools within walking distance.” However, many environmentalists are appalled, since these cities will be build in the wilderness, requiring roads and infrastructure to these newly deforested locations. Not only that, many rural residents will be forced to resettle into the “Socialist Cities.” The history of these sort of projects are dismal. From the Washington Post article Chávez’s ‘Socialist City’ Rises: “The majority of socialist cities that were built in socialist countries failed,” said Maria Josefina Weitz, an urban planner in Caracas. “When you create something by […]

CTA “Super Station” Mothballed

Photo by flickr user mss2400 Thanks, DBM for the tip: Faced with runaway costs, the CTA and City Hall slammed the emergency brakes Wednesday on ambitious plans to build a “super station” in downtown’s Block 37 to speed express trains to both Chicago’s airports. A combined $213 million has been spent on the project, yet there is not much more than a massive hole in the ground to show for it. At least an additional $100 million would be needed to complete the subterranean station, the CTA estimated. “The Block 37 curse continues,” said Joseph Schwieterman, a transportation and urban planning professor at DePaul University who has for years doubted the viability of the transit project. read the Chicago Tribune article here: CTA ‘super station’ in a hole Damn. I was really looking forward to the express connection to the airports. Had I not gone back to grad school, I would have worked on the subway station and tunnel design. But, I was always suspicious of how/if trains would actually be express without adding significant amounts of track and switching. With any major Chicago public project, always be suspicious that it will cost what the politicians say. The common joke is that there is a factor of 2.5: actual cost / original announced cost. The funny thing is that the factor seems pretty close to accurate. I wonder if there is any real data on that. I definitely recommend reading Here’s the Dealby Ross Miller, to learn the long history of Block 37 and political meddling in Chicago’s downtown.

Quinn Proposes to Revamp Rent Control ‘Freakshow’

Curbed NY – Christine Quinn, Hands Off Our Freakshow! Fact: The biggest joke in New York is the Rent Guidelines Board. Every year this nine-member panel gathers to hold a series of circus-like public hearings on rent increases (or, heh, decreases) for stabilized apartments. Every year, tenant groups demand a rent freeze, and landlord groups demand double-digit increases. Every year, the increases fall somewhere in the middle (this year is a little high, though), following lots of shouting, some impromptu jam sessions and occasional nudity. But here’s the thing: it’s only now, when this annual theater is suddenly threatened, that we realize how much we’d miss the damn thing. Quinn (City Council Speaker) is supporting a state bill that would restructure the board (which is appointed by the mayor and includes two members representing tenants, two representing landlords, and five representing the “general public”), deny rent increases for one year on buildings with serious violations, and require the use of a tenant’s income and expenses in determining whether an increase is warranted. So, owners would be subject to the needs of their tenants? I doubt the “general public” she refers to includes the interests of the renters moving to New York or market rate renters… Also: NY Sun: Speaker Quinn Urges Overhaul of Rent Board

Cubs Fail to Sell Wrigley to State (100 years of faith for sale)

I received a message from a reader with a link: Probably not as interesting to your NY readers, but Wrigley is back on the market. Can’t say I like the cubs, but you have to give credit (?) to their fans, 100 years of painful loss and they still love the cubs. I’m guessing most of the fans would also like to see Bush given a 3rd, 4th, or 100th term to see if he could actually succeed. Nothing like blind faith, I guess…. DBM MLB – Wrigley Field back on the market Dan, Thanks for the tip. Market Urbanism actually has readers across the world, not just NY. As a fellow White Sox fan, I would hate to have my hard earned money subsidize the enjoyment of those despised Cubs fans. But, by that same logic, the public financed the Sox’s ballpark. Should I feel guilty?… Check out this econtalk podcast about externalities and subsidies. At 9:15, they discuss subsidies to sports teams.

Bush’s “Ownership Society” and Subprime

From Rationalitate – The WaPo finally realizes the root cause of the subprime crisis Agencies like FHA and HUD, and pseudo-private agencies like Fannie Mae and Freddie Mac, were the government’s tool to manipulate the market for mortgages, and manipulate it they did: 40% of all mortgages are financed by lending companies Fannie Mae and Freddie Mac, which hold $5.3 trillion in outstanding debt, and receive tax breaks (read: subsidies) to the tune of $6.5 billion a year. Part of the irony of Bush’s “ownership society” is that it requires taxpayers to fund it. While on its face home ownership might seem like the paragon of private property and private ownership, it’s really not in very high demand in the actual free market. While America does indeed have very high rates of homeownership, it’s in spite of the market, not because of it. (I don’t really agree with the phrasing, “it’s not really in high demand.” I think almost all people desire to own their dwelling, but at a price that makes sense for them.) “Experts” often say how important it is for people to “own” their homes. I agree that ownership is great. But, at what cost? Market distortions that create bubbles? Wealth transfers from the less fortunate and landlords to “owners” of homes? “Ownership” isn’t best for everyone, especially the “owners” of a junk loan…

Want Density? Turn the Free Market Loose

Matthew Yglesias – What Price Density The solution, as Ryan Avent says, is to build denser communities. We ought to build more transit infrastructure, of course, but it’s cheaper to use what we already have more intensively. And, of course, it’s more practical to build new infrastructure if there’s a reasonable expectation that it will serve intensive development. Beyond that, density also serves to make walking and biking more practical for more trips. And best of all, getting denser could be accomplished mostly through growth-enhancing relaxation of regulatory burdens. And of course if the supply of housing in central cities and nearby suburbs were radically higher, then it would be much easier for people to afford to live in them. Instead, restrictions on the supply of conveniently located housing lead to high prices and the “drive until you qualify” phenomenon that’s currently leaving many Americans in deep trouble as they try to pay for fuel. In general, relaxing density restrictions will ease housing prices. But, a couple notes: Creating more socialized infrastructure, whether transit or roads, disperses development. High densities create demand for transit, not the other way around. Transit creates demand to locate near the stations, but not elsewhere. This is because as commuters are diverted from roads, congestion subsides, allowing drivers to commute from further-out places. So, if density is the goal, I would privatize highways & parking, while putting the breaks on construction of new public highways & parking prior to building new expensive transit. If individual commuters were to pay for their use of the roads, many would alter their habits and perhaps where they choose to commute to / from. The change in location preference will, no-doubt, increase density. Building densely has higher construction costs per unit as land costs are dispersed among more units, […]

CATO Podcast: Transportation

Today, I was listening to CATO’s Daily Podcast about transportation with Samuel Staley of the Reason Foundation. I started listening to him talk about the best ways to plan highway systems and said to myself, “Oh boy, here we go again another so-called “free-market” person talking about how the government can ‘pave our way out of congestion’.” “We’ve got the space, and we’ve got the land, and we’ve got the wealth” to pave away congestion. That’s a very collective “we” for a supposed free-market person to use. But, after about 5 minutes of that, he goes into how we now have the technology to privatize highway use and are 15 years away from the technology to privatize even local roads. Now we’re talking. We need to actually begin to tie those traditional market mechanism to the products that are being developed and implemented at the local level, and that’s something we’ve never been able to achieve before. It’s an exciting time for transportation policy. If, transaction costs are no longer the obstacle to privatization, society needs to start shattering these bureaucracies and selling the roads to the private sector. I think the biggest hurdles to privatization are peoples’ perception/biases and politics. People never paid for roads before, so it’ll take effort to convince them it is not as free as the air we breath… download mp3

Historic Preservation Can Work in the Marketplace

Houston Strategies – Historic preservation should be a neighborhood choice “In Houston’s Old Sixth Ward, the city’s first fully protected district, property values have shot up 27 percent in the last year. When given the chance, historic preservation works.” This is great news! It means there should be absolutely no problem getting voluntary neighborhood buy-in for deed restrictions. If it boosts their values, who could be opposed? Why do we need the government to impose it, when it’s obviously in their own self-interest? I argued a similar point in comments about the Carroll Gardens’ downzoning. In the case of Historic Preservation, neighbors could voluntarily form a corporation that owns facade easements on their properties. The corporation would protect the historic structures via property rights, as opposed to by mandate. Outsiders could always donate money to the corporation to buy easements on certain historic properties or make repairs. Did you know that facade easement donations by owners of historic buildings are considered tax-deductible contributions? If a municipality really feels it needs to step in, it could purchase those easements at market price, but it would probably be unnecessary.

Airport Protectionism?

Richard’s Real Estate and Urban Economics Blog – Federalism and Taxis Taxicabs in the Washington area are regulated by various jurisdictions–DC cabs may not pick up fares in Virginia and Maryland, Virginia cabs can’t get passengers in the District and Maryland, and District Cabs are forbidden from pick ups in Maryland and Virginia. In New York, they charge an additional $15 surcharge fee to take a taxi to Newark, NJ. It seems like interstate protectionism to me, nudging me to use LaGuardia or JFK.

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