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Book Club Update
The next post on The High Cost of Free Parking will be on Monday, covering chapters 5-9, for anyone who is reading along.
Liberalizing Cities
From The Ground Up
“This is the dirty secret of California’s Density Bonus law…”
Inclusionary zoning – everyone wants to talk about it! Dave Alpert at GGW started the discussion with his pro-IZ piece, and hot on the heels of Emily’s post earlier today, I got an email from a California developer who wishes to remain anonymous: This is the dirty secret of California’s Density Bonus law: it’s primarily a way to give 100% affordable projects easy land use concessions. It has barely any effect on market-rate projects, despite all the attention it gets from affordable housing advocates. Incidentally, the number of affordable units in market-rate density bonus projects – 212 – over the total number of units produced in L.A. during the same period – 53,000 – is 0.4%. Vanishingly few. The number of units produced exclusively with the parking concession – the 6 condo conversion units – is 0.01%. Statistically the same as zero. If people really want to get affordable housing built, they would do much better to find more direct ways to pay for it – like through property tax revenues or other sources where everybody pays. Trying to pay for affordable units by constraining market-rate development and trying to the capture value that is “created” when those constraints are released is not only a pretty ineffective way to create affordable housing, it’s an excellent way to make market rate housing more expensive. I’ve got some thoughts of my own on inclusionary zoning and the anti-density sentiment it can engender among some affordable housing activists, which I’ll hopefully post tomorrow.
Florida East Coast looks to hook up with Orlando International
The mystery of why in the hell Florida East Coast Industries would want to start private passenger service from Miami to Orlando just got a little bit clearer: they may also be getting an intermodal freight connection to Orland International Airport! A press release from the airport authority (.pdf): Demonstrating a vision for the future, the Greater Orlando Aviation Authority, which operates Orlando International Airport, has already invested in infrastructure for a station that could accomodate up to four rail systems. In discussing the integration of rail [Phil Brown, Executive Director Orlando International Airport] explained, “We have planned our intermodal facility in a central location to service both the north and the future south terminal and All Aboard Florida is vying to be the first rail system to operate from it.” […] After considering FECI’s proposal, the Board approved the request and authorized the Executive Director to develop an agreement with FECI to provide commercial passenger service to Orlando International Airport’s Intermodal Facility to be presented to the Aviation Authority Board. The railroad clearly wants to continue to grow its freight business while introducing passenger service, which will make them one of the few private constituencies for FRA crash safety reform. They already have very good signaling because of their reliance on time-sensitive intermodal freight (most American railroads carry slow bulk freight like coal, chemicals, and grain), which will help them when they get in front of the FRA and have to prove that they can prevent and mitigate crashes without bulking their trains up like tanks. A cynic could say they’re only starting passenger service to get subsidies from the government for their freight business, but for the moment I’d like to be optimistic and think that it’s a genuine synergy. And then there’s this out of Rep. John Mica’s […]
Rent control by any other name
Earlier this week, David Alpert wrote a piece at Greater Greater Washington on the benefits of inclusionary zoning and why economists should support it. I would counter that IZ as designed in DC is not an efficient program for providing affordable housing, and to the extent that it does provide significant numbers of price-controlled housing units, it will necessarily have many of the negative attributes of rent control. IZ works by requiring developers to provide below-market cost units in addition to market rate housing, and providing them with “density bonuses” in exchange. The problem with this is that building more units in itself makes housing more affordable. Obviously I understand the many political obstacles to allowing more residential development, but I don’t think that introducing units that are permanently price-controlled is the appropriate price to pay for this political concession. As Walter Block writes at the Library of Economics and Liberty: Economists are virtually unanimous in concluding that rent controls are destructive. In a 1990 poll of 464 economists published in the May 1992 issue of the American Economic Review, 93 percent of U.S. respondents agreed, either completely or with provisos, that “a ceiling on rents reduces the quantity and quality of housing available.” Similarly, another study reported that more than 95 percent of the Canadian economists polled agreed with the statement. The agreement cuts across the usual political spectrum, ranging all the way from Nobel Prize winners Milton Friedman and Friedrich Hayek on the “right” to their fellow Nobel laureate Gunnar Mydral, an important architect of the Swedish Labor Party’s welfare state, on the “left.” Myrdal stated, “Rent control has in certain Western countries constituted, maybe, the worst example of poor planning by governments lacking courage and vision.” Consumers and producers in the IZ market will face the same […]
Before the landmarks…
The other day I was stumbling around Wikipedia when I found pictures of what was apparently the first iteration of New York’s Grand Central train station, called Grand Central Depot. The “depot” opened in 1871 and was built in the neo-Renaissance style that was popular back then (as opposed to the final, neoclassical incarnation), and stood for less than 30 years. It was partly torn down and reconstructed in 1899, and then totally demolished “in phases” between 1903 and 1913 to make way for today’s Grand Central Terminal. This got me thinking about the old Pennsylvania Station whose demolition was a catalyst for the modern preservationist movement. Like nearly every big old building in New York, it was of course not the first building to stand there – development in cities during the prewar era was as much about redevelopment as it was about building in greenfield sites. It was a given that building would come down and new ones would be built – a city that’s been disrupted in most American downtowns. (Midtown Manhattan is of course one of the few places in the U.S. where this still happens – the Drake Hotel was of course torn down a few years ago by Harry Macklowe, on the site of what is now 432 Park Ave., and the Hotel Pennsylvania across from Penn Station will likely be replaced with an office tower once the market comes back.) Anyway, I put out a call on Twitter for pre-Penn Station history, and lo and behond @enf alerted me to a panel at an exhibit at the Transit History Museum in Brooklyn, which I managed to find some pictures from on Flickr. Here’s a wide shot of the panel (though you can zoom in pretty close), and here’s some of the text that […]
Look beyond Fourth Avenue in Brooklyn for solutions to a lack of retail
Robbie Whelan’s got a column in today’s Wall Street Journal on Brooklyn’s Fourth Avenue, which is something I’ve been thinking a lot about since I moved to Brooklyn earlier this year. If you don’t recall, last year the City Council passed a zoning amendment to require new residential developments on the transit-rich, pedestrian-unfriendly avenue in South Brooklyn to include a certain amount of ground-level retail, to appease the ghost of Jane Jacobs and to stop burning the souls of all who walk the avenue. Robbie’s column is outwardly critical of the city (he blames “bad decisions by Amanda Burden’s City Planning Department”), but on another level, he’s just cheering on what DCP already did (“the city finally got wise and passed another zoning change last year”). But walking down Fourth Avenue, and seeing all the vacant retail storefronts in apartment buildings sprinkled around the neighborhood from the last development cycle, it seems obvious that the real problem is a lack of demand, which Robbie derides as “the profit-above-all-else motive of some developers” (“some”…ha!). Namely: the neighborhoods around Fourth Avenue are too auto-bound and not dense enough to support the retail and pedestrian traffic that would make Fourth Avenue a vibrant place. (The lots bordering Fourth Avenue may one day grow dense enough to support retail without the help of their side streets. But for now, only mid-rise development is allowed, so I don’t see Fourth Avenue being self-sustaining any time soon.) Perhaps the biggest problem is the industrial zoning around the Gowanus Canal and Bay, a few avenues over from Fourth Avenue. Capital has replaced labor in U.S. non-service-sector jobs over the last century, and the only business that can take advantage of the zoning around Third Avenue are auto-oriented (manufacturers these days ship their goods by highways, not canals!). […]
New York transit officials grudgingly consider using existing track more efficiently
Now that Chris Christie killed the ARC project, which would have built another rail tunnel between New Jersey and Manhattan, Transportation Nation is reporting that MTA boss Joe Lhota is asking the different New York area railroads to do what they were supposed to do half a century ago when they were nationalized: cooperate! What to do in the meantime? Lhota tossed out three ideas, each aimed at boosting capacity at Penn Station in Manhattan, the hemisphere’s busiest railroad station and a terminal for New Jersey Transit trains. He said the station’s 21 platforms should all be made to accommodate 10-car trains, which would mean lengthening some of them. He also said that the railroads using the station—Amtrak, New Jersey Transit and Long Island Rail Road—should do a better job of sharing platform and tunnel space. Each railroad currently controls a third of the platforms, which sometimes leads to one railroad having too many trains and not enough platforms at the same time another railroad has empty platforms. The railroads also vie with each other for access to tunnels during peak periods. Lhota said capacity would be boosted if dispatchers in the station’s control room could send any train to any platform, and through any tunnel, as they saw fit. Lhota’s third suggestion was the most ambitious. He said the three railroads—plus the MTA’s Metro-North line, which connects Manhattan to Connecticut and several downstate New York counties—should use each other’s tracks. In other words, trains should flow throughout the region in a way that sends them beyond their historic territory. For example, a train from Long Island could arrive in Penn Station and, instead of sitting idly until its scheduled return trip, move on to New Jersey. That way, trains would spend less time tying up platforms, boosting the station’s […]
TRD: Bushwick is staying industrial – no residential rezoning for East Williamsburg!
The Real Deal says that Bushwick, a neighborhood on the L that’s seeing a lot of housing demand spill over from Williamsburg, is not getting a residential rezoning. TRD describes how the “sought-after northwestern area […] is zoned for manufacturing, so residential building is largely banned there,” but then buries the lede deep down: And while the city passed a high-profile rezoning for the Williamsburg and Greenpoint waterfront in 2005 — paving the way for high-density housing in formerly industrial sites — no such rezoning is on the horizon in Bushwick, the department of City Planning said. The North Brooklyn Industrial Business Zone, which encompasses a portion of Bushwick, was created in 2005 by Mayor Michael Bloomberg as “a sort of policy statement: ‘Hey, these are industrial and are currently used for manufacturing — and should stay that way,’?” explained Mitchell Korbey, head of the land-use department at law firm Herrick Feinstein. The Bloomberg administration has done a record number of rezonings, but sources said the mayor, along with Brooklyn borough president Marty Markowitz, wants to keep Bushwick’s zoning predominantly industrial to preserve the city’s manufacturing base. Dolgin, for example, said he recently sold a 46,000-square-foot parcel at McKibbon and Bogart streets for $4.37 million, and the site will be used as storage for scaffolds. In some southern portions of Bushwick, a mixed-use building can be redeveloped as residential, but a variance is required to do that in most of the popular East Williamsburg area, and they are rarely granted, Dolgin said. The article says that the SoHo loft law is occasionally being used to convert existing structures, and that hotels and hostels are being built since they’re allowed by zoning. Then again, Bloomberg’s rezoning days are over after the Midtown East upzoning, so his opinion on rezoning Bushwick isn’t […]
The High Cost of Free Parking Chapters 1-4
Here’s the first installation of Market Urbanism Book Club, covering the first four chapters of Donald Shoup’s The High Cost of Free Parking. If you’ve read the book previously or are reading along, please share your thoughts and questions in the comments. Chapter 1: Shoup outlines the unusual view that we take toward parking. Rather than assuming that demand for parking, like any other good, is a function of its price, urban planners typically assume that parking is a zero-price good and require building owners to provide enough parking to meet demand given a zero price. Imagine that this was the way we treated other goods… This Friday afternoon I’m thinking of a municipality that requires bars to provide their customers with as much beer as they’d like at a zero monetary cost. Shoup points out that of course we pay for the cost of all this parking, only drivers do not pay this price in their role as drivers. We pay for it as a tax on housing, retail goods, and in the form of lower wages as workers. Those who pay the highest tax are of course non-drivers. Some drivers are subsidized under this system with the highest subsidy going to drivers who make frequent, short car trips. He explains that off-street parking requirements developed as the demand for zero-price curb parking outpaced supply. This is a classic case of the Tragedy of the Commons. Because no one had property rights of street parking, it was overused. Rather than charging for this scarce resource, or allowing building owners to provide their customers with parking at profit-maximizing prices, city governments turned to regulations. Chapter 2: In this chapter, Shoup really gets to the core of the problems that government employees face when they try to provide consumer goods. Some […]
Randal O’Toole: “If you didn’t have those suburban restrictions, you wouldn’t have that pressure for density in DC”
Earlier today I posted the video of the Cato discussion on housing with Randal O’Toole, Ryan Avent, Adam Gordon, and Matt Yglesias, but I wanted to transcribe one segment towards the end. (Like I said, it’s hard to skip to the end of the streaming video because you can’t scroll beyond what’s already been downloaded.). For the last question, someone from the audience says he’s a fan of Randal’s who lives in DC, and asks Randal, and the rest of the panelists, what they about the recent calls to lift the city’s height limit in response to development pressures. Randal responds first: Well this is where I think the policy questions [and the difference between Randal and the other panelists] come in on density. I think we ‘ve got Maryland, which has all these restrictions on supposedly protecting agricultural land, we have Loudoun County and other counties in Virginia that have zoned most of their land for 20-acre large lot sizes, those have restricted the ability of people to live in single-family, to build new single-family homes in the Washington, DC, metropolitan area. And so it’s created a pressure for more density in Washington, DC, but if you didn’t have those suburban restrictions, you wouldn’t have that pressure for density in Washington, DC. So I’d say, let’s get rid of the suburban restrictions, and then see if there really is a demand for high-density high-rise in Washington. If there really was a demand, there’s a lot of three-story buildings that could be redeveloped to be six and seven stories if you wanted to. Matt: “You’re not allowed to!” Ryan: “You should try to do that – if you can make it happen, then that would be a great profit opportunity.” Randal: “Well, I’ve seen streets of row houses here [in DC] […]
