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Category planning

The deal-making behind the Silver Line

In political transactions, players cannot make deals using dollars, but nonetheless they engage in trades to pursue their goals. Policymakers may engage in trades both with other policymakers and with private sector actors . While these deals are not denominated in dollars, their gains from trade can still be considered “profit” that goes to the parties to the trade. In the decision to create the DC Metro’s silver line extending from West Falls Church to Dulles International Airport, many public sector and private sector parties profited from the complex dealmaking that facilitated the extension. The Silver Line was accompanied by redevelopment planning for Tysons Corner, a suburb of DC along the line’s route. These rail construction and accompanying rezoning benefitted three primary groups. The first and most obvious beneficiaries of the development of the Silver Line were the individuals and corporations that owned large parcels of land near the planned stations. The value of their holdings increased not only because of the new infrastructure, but also because the planning for the Silver Line involved significant upzoning, making more intensive and profitable use of their land legal. The combined promise of upzoning and the new metro stations ensured local policymakers that powerful landowners would support their efforts. These large landowners who benefited from upzoning include West Group, Tysons Corner Property, and West Mac Associates among other. The leadership members of these corporations were active in commenting on the proposed changes to the area’s land use and transportation plans. Because of its large investment in Tysons Corner and its corresponding importance in the development process, West Group has had special involvement in the redevelopment process. Implementing the proposed grid of streets relies heavily on West Group properties and other major developers cooperating to minimize the need to use eminent domain to achieve the infrastructure requirements to facilitate increased […]

How land use regulations hurt the poor

Sandy Ikeda and I have published a new Mercatus paper on the regressive effects of land use regulation. We review the empirical literature on how the effects of rules such as maximum density, parking requirements, urban growth boundaries, and historic preservation affect housing prices. Nearly all of the studies on the price effects of land use regulations find that — as supply and demand analysis would predict — these rules increase the price of housing. While the broad consensus on the price effects of land use regulations is probably to no surprise to Market Urbanism readers, some policy analysts continue to insist that in fact rules requiring detached, single family homes help cities maintain housing affordability. Ed Glaeser, Joseph Gyourko, and Raven Saks estimate the effects of regulations on house prices in their paper “Why Is Manhattan So Expensive? Regulation and the Rise in Housing Prices.” They estimate what they call the “zoning tax” in 21 cities. The zoning tax indicates the proportion of housing costs that are due to land use regulations. The chart below shows the percentage of housing costs that this “tax” accounts for: Policies that increase housing costs have a clear constituency in all homeowners, but they hurt renters and anyone who is hoping to move to an expensive city. The burden of land use regulations are borne disproportionately by low-income people who spend a larger proportion of their income on housing relative to higher income people. These regressive effects of land use policy extend beyond reducing welfare if the least-advantaged Americans. Additionally, rules that increase the cost of housing in the country’s most productive cities reduce income mobility and economic growth. In our paper Sandy and I also discuss proposals for reducing the inefficiency of cities’ current land use regulation practices. David Schleicher has proposed some […]

Smart city data and political opportunism

The term “smart cities” encompasses the interaction of the Internet of Things, the urban environment, and city dwellers. While these innovations have facilitated some very successful new services, smart cities have important limitations in the public sphere. Smart city technology includes city services like bike share systems and pedestrian, transit, and driving directions conveniently accessible on smart phones. Beyond these services, however, some city leaders have plans to revolutionize city planning through smart city data. Their ideas include facilitating evacuation during emergencies, reducing traffic congestion, and lowering crime. The proliferation of data arising from smart city tools has fostered many public policy experiments. In his book Smart Cities, Anthony Townsend covers how big data has opened up new opportunities for government service provision and government control. Townsend cites the example of Rio de Janeiro’s implementation of IBM technology as an example of the utopian thinking that smart city tools have inspired: What began as a tool to predict rain and manage flood response morphed into a high-precision control panel for the entire city. […] Just how effective Rio’s operations center will be in taming the wild metropolis remains to be seen. Urban security experts with whom I have spoken are skeptical that it will dramatically improve the effectiveness of law enforcement, and technology experts point out that beyond the video streams there has been little investment in new sensor infrastructure to feed real-time data to the center. Townsend points out that a key motivation of city leaders in adopting smart city technology has been creating the impression of being high tech rather than actually improving city services. He quotes the IBM team that implemented Rio’s weather forecasting and surveillance system saying, “That was a big surprise to us. We thought that this was going to be about ROI models, and the efficiency that we can produce. To […]

Systemic bias against small scale development

In recent years, some of the country’s largest mixed-use real estate developments involved disposition of government-owned land directly to developers. For example, Atlantic Yards in Brooklyn and DC’s City Center and Marriott Marquis came about when municipal governments issued requests-for-proposals for underutilized land that they owned. Last week, Mid­Atlantic Realty Partners and Ellis Development Group closed on a deal to purchase 965 Florida Avenue NW from the District of Columbia. In 2012 the Office of the Deputy Mayor for Planning and Economic Development (DMPED) issued an RFP for this 1.45 acre at the intersection of the Shaw, U Street, and Columbia Heights neighborhoods. The RFP specified that any development on the site include affordable housing. Ultimately two developers submitted proposals. The winning developer purchased the land for just $400,000, at least $5 million less than appraisers estimated the land’s value to be, even after factoring in the affordable housing provision and needed environmental cleanup. By choosing to allocate very large parcels of land through this process rather than auctioning off small parcels of city-owned land, municipal officials favor large developers not only because smaller developers can’t afford such large parcels, but also because the RFP process favors established developers with political connections. In DC, large development firms provide some of the largest contributions to local campaigns. Not only does the sale of large parcels of public land exclude small developers who have less financial capital, it also reduces the pool of potential buyers to include only those with the political capital needed to navigate the RFP process. In the case of a private owner selling off a large tract of land, we would expect him to list the property for sale, accepting the best price he could get. If he thought smaller parcels would sell for more, the owner would likely try to subdivide before selling, expanding […]

Engineering in the dark

The similarities of urban design across American neighborhoods is no coincidence, but neither is it the result of city planners’ uniform adherence to best practices. Infrastructure is often built based on shockingly little information about the demands of its users. And while poorly reasoned infrastructure policy in one city is bad enough, the United States’ broad adherence to poorly reasoned policies has resulted in a nation in which swaths of neighborhoods are built on poor design foundations. Parking Requirements In The High Cost of Free Parking, Donald Shoup explains the origin of municipal parking requirements. Municipal planning offices do not have the resources to study the amount of parking that businesses should provide. Even with more staff, it’s not clear that planners would be able to determine optimal parking requirements unless they allowed business owners themselves to experiment and choose the amount of parking on their own in a learning process of how to best serve their customers. The Institute of Transportation Engineers is one of the only organizations that provides estimates of the number car trips that businesses generate. Given the lack of information planners have to determine parking requirements, they often rely on ITE’s information to set their parking requirements. However, ITE studies are often conducted at businesses that already provide ample free parking, ignoring the potential for businesses to manage demand for parking on their property through prices. Furthermore, ITE estimates of trip generation are typically based on a very small sample of locations, which are unlikely to be representative of businesses and cities in general. In the example below, the ITE provides a recommendation for fast food parking requirements based on their floor area. Even though the chart includes a line of best fit for the plot of peak parking spot occupation and floor area, the ITE hasn’t demonstrated a correlation between these two variables. Shoup points out: We cannot say much about how […]

Trickle-Down Housing Economics? Laying Reagan’s Ghost to Rest

In a recent 48 Hills post, housing activist Peter Cohen aimed a couple rounds of return fire at SPUR’s Gabriel Metcalf. The post comes in response to Mr. Metcalf’s own article critiquing progressive housing policy. Mr. Cohen bounces around a bit, but he does repeat some frequently used talking points worth addressing. Trickle-down economics Mr. Cohen calls the argument for market-rate construction ‘trickle down economics’.  Trickle down economics actually refers to certain macro theories popularized during the Reagan years. These models assumed a higher marginal propensity to save among wealthier individuals. And given this assumption, some economists concluded that reducing top marginal tax rates would result in higher savings. This would then mean higher levels of investment which would, in turn, have a positive effect on aggregate output. And from there we get the idea of a rising tide lifting all ships. Note that none of that has anything to do with housing policy. Labeling something ‘trickle down’ is a way to delegitimize certain policy proposals by associating them with Ronald Reagan. It’s somewhere between rhetorically dishonest and intellectually lazy. Though to be fair, it’s probably pretty effective in San Francisco. The concept Mr. Cohen is trying to critique is actually called filtering. In many instances, markets do not produce new housing at every income level. But they do produce housing across different income levels over time. Today’s luxury development is tomorrow’s middle income housing. The catch, however, is that supply has to continually expand. If not, prices for even dilapidated housing can go through the roof. For a more thorough explanation, see SFBARF’s agent based housing model.   If you build it, they’ll just come But even accurately defined, Mr. Cohen still objects to the concept of filtering. He cites an article by urban planning authority William Fulton to make […]

Urban Renewal in Philadelphia

The Philadelphia Housing Authority will seize  nearly 1,300 properties for a major urban renewal project in the city’s Sharswood neighborhood. The plan includes the demolition of two of the neighborhood’s three high-rise public housing buildings — the Blumberg towers — that will be replaced with a large mixed-income development. The new buildings will increase the neighborhood population tenfold with the majority of the new units to be affordable housing. The majority of the 1,300 lots slated for eminent domain are currently vacant. At a City Council hearing on Tuesday, Philadelphia Housing Authority CEO Kelvin Jeremiah testified that the redevelopment plan furthers the agency’s efforts to replace high-rise housing projects with lower-density units. However, PHA’s plan misses the forest for the trees. The benefits of demolishing the two towers are immediately undone by creating an entire neighborhood of public housing, effectively increasing the concentration of poverty in Sharswood. Adam Lang has lived in Sharswood for 10 years, and he posted about the plan in the Market Urbanism Facebook group. Adam has raised concerns that the PHA does not have an accurate number of how many of the 1,300 properties in the redevelopment territory are currently occupied. Adam’s primary residence is not under threat of eminent domain, however he owns four lots that are. He uses two lots adjacent to his home as his yard. The other two are a shell and a vacant lot. He purchased them, ironically, from the city with the plan to turn them into rentals. Adam’s concern about the inaccuracy of PHA’s vacancy statistics stem from the method that PHA employees used to create their estimate: driving by homes to see if they look occupied or not. Adam’s own property was on the list of vacants, and he said that he’s aware of other properties in the neighborhood […]

What is wrong with “How to Make an Attractive City”

“How to Make an Attractive City”, a video by The School of Life, recently gained attention in social media. Well presented and pretty much aligned with today’s mainstream urbanism, the video earned plenty of shares and few critiques. This is probably the first critique you may read. The video is divided into six parts, each with ideas the author suggests are important to make an attractive city. I will cover each one of them separately and analyze the author’s conclusion in a final section. 1 – Not too chaotic, not too ordered The author argues that a city must establish simple rules to to give aesthetic order to a city without producing excessive uniformity. From Alain Bertaud’s and Paul Romer’s ideas, it can make sense to maintain a certain order of basic infrastructure planning in to enable more freedom to build in private lots. However, this is not the order to which the video refers, suggesting rules on the architectural form of buildings. The main premise behind this is that it “is what humans love”. But though the producers of the video certainly do love this kind of result, it is impossible to affirm that all humans love a certain type of urban aesthetics generated by an urbanist. It is even less convincing when this rule will impact density by restricting built area of a certain lot of land or even raising building costs, two probable consequences of this kind of policy: a specific kind of beauty does not come for free. Jane Jacobs, one of the most celebrated and influential urbanists of the modern era, clearly argued that “To approach a city, or even a city neighborhood, as if it were a larger architectural problem, capable of being given order by converting it into a disciplined work of art, […]

Seamless Transit: Thoughts on the new report from SPUR

Seamless Transit is the new transportation policy report from SPUR. Main author Ratna Amin proposes integrating the Bay Area’s balkanized transit systems to improve lackluster ridership. Given that the region has 23 separate transit providers–more than any other metropolitan area in the country–she may have a point. The report proposes standardizing service maps, fare structures, and payment systems; eliminating inter-system coverage gaps as well as redundant coverage; and reforming transit governance so that the different agencies actually make plans together instead of working at cross-purposes or not at all. The recommendations are sound and the report includes historical footnotes for context. These are helpful for understanding region’s complicated institutional arrangements. Seamless Transit is a fine piece of work and well worth the read for anyone interested in Bay Area transportation. But while organizational efficiency is important, it’s not the only thing to discuss. If we want to improve the region’s mass transit systems, we have to consider the physical environment in which those systems are embedded. To get transit right, the region needs to embrace density. Denser development around transit nodes would increase ridership substantially. When people live, work, and play in smaller geographic areas, more people travel between a fewer number of points. Mass transit, especially fixed rail transit, becomes more effective the denser development becomes. Hong Kong’s Metro Transit Railway (MTR) might be the quintessential example of urban density begetting mass transit success. The city is home to over 7 million inhabitants. It has a population density of over 18,000 residents per square mile. And of this population, 41% live within a half mile of an MTR station. The result? The MTR has a farebox recovery ratio of 186%–the highest in the world. Because of legal as well as political differences between Hong Kong and the Bay Area, […]

Only 2 Ways to Fight Gentrification (you’re not going to like one of them)

gentrification

Gentrification is the result of powerful economic forces. Those who misunderstand the nature of the economic forces at play, risk misdirecting those forces.  Misdirection can exasperate city-wide displacement.  Before discussing solutions to fighting gentrification, it is important to accept that gentrification is one symptom of a larger problem. Anti-capitalists often portray gentrification as class war.  Often, they paint the archetypal greedy developer as the culprit.  As asserted in jacobin magazine: Gentrification has always been a top-down affair, not a spontaneous hipster influx, orchestrated by the real estate developers and investors who pull the strings of city policy, with individual home-buyers deployed in mopping up operations. Is Gentrification a Class War?   In a way, yes.  But the typical class analysis mistakes the symptom for the cause.  The finger gets pointed at the wrong rich people.  There is no grand conspiracy concocted by real estate developers, though it’s not surprising it seems that way. Real estate developers would be happy to build in already expensive neighborhoods. Here, demand is stable and predictable.  They don’t for a simple reason: they are not allowed to. Take Chicago’s Lincoln Park for example.  Daniel Hertz points out that the number of housing units in Lincoln Park actually decreased 4.1% since 2000.   The neighborhood hasn’t allowed a single unit of affordable housing to be developed in 35 years. The affluent residents of Lincoln Park like their neighborhood the way it is, and have the political clout to keep it that way. Given that development projects are blocked in upper class neighborhoods, developers seek out alternatives. Here’s where “pulling the strings” is a viable strategy for developers. Politicians are far more willing to upzone working class neighborhoods. These communities are far less influential and have far fewer resources with which to fight back. Rich, entitled, white areas get down-zoned. Less-affluent, disempowered, minority […]

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