Wrong Diagnosis Underlies Post's Pessimism on Smart Growth

Walter Rybeck

[An article printed in The Montgomery County Seirran, October-November 2004.
Reprinted from GroundSwell, May-June 2005]

We would be amused if Martian observers, seeing people with crutches, concluded that crutches had crippled these folks. Analysts cited in the Washington Post's recent series on sprawl are not from Mars, but many confused the crutches localities fall back upon as the cause of our region's crippling growth pattern.

Montgomery and other counties around the District of Columbia are blamed in Post writer Peter Whoriskey's articles for pushing residential growth to the Eastern Shore and West Virginia by inviting job growth while curtailing home construction. These policies do accelerate sprawl but they are crutches. Counties like Montgomery and Fairfax use these crutches to defend against severe fiscal burdens of upgrading infrastructure to serve their residents who fled the region's core or who avoided settling there. People who chose to reside in the lower-tax and lower-housing-cost counties support these crutches when they sense that these advantages are in jeopardy.

The Post paints a seemingly hopeless picture because it fails to recognize the real engines of sprawl - high land values, land speculation, and subsidies for development on greenfield sites. Wasteful scattershot development will continue to defeat Smart Growth until officials and voters confront these matters.

High Land Values and Speculation.

High land values stem from: 1) regional population growth, 2) public works like roads and schools, 3) special natural features like waterfronts, and 4) the totality of private and public activities that make our area productive and attractive to those who live, work, and visit here. For example, a 1980 Congressional study found that Metro, still unfinished, had already generated $2 billion in new land values. The study found that "the biggest share of these new values is going to people lucky enough to own land within easy access of Metro stations," not to all taxpayers via governmental units that financed Metro or to the subway authority.

Sprawl starts at the center of the metropolis and radiates outward. Smith owns a vacant site in downtown D.C. If he builds offices, housing or a mixed use building, he invites risks, headaches, and sizeable property tax increases, so he keeps his site idle or in minimal use like a parking lot. Brown, seeing the productive potential of Smith's location, offers to buy it. Yet Smith who is getting something for nothing - his rising land values - asks for a price so high that Brown's venture can't fly. Brown approaches owners of other first-class sites, meets the same hurdle, and finally buys a less ideal second-class site he can afford. More "Browns" do the same.

By the time Jones and other enterprisers come along, owners of second- and third-class sites have also boosted their lot prices. Owners get away with this because "land hoarding" in the core creates an artificial scarcity of affordable sites. Many "Joneses" are driven farther into the hinterland. Developers who invade open space in a sense are "refugees," denied entry by inflated land prices from close-in sites better suited for their ventures. This unending race to beat speculators to cheap land expands leapfrog growth patterns over increasingly large areas.

The amount of potential infill sites in D.C. withheld by speculation was seen in the count of over 11,000 vacant lots and 7,000 boarded-up housing units several years ago. The District is far from unique. One-quarter of all privately-owned land in the nation's 100 largest central cities was vacant two decades ago, a "Compact Cities" study by Congress revealed.

Subsidized Sprawl

Federal and state spending on misplaced highways, utilities, schools, and the like subsidize premature urbanization of outlying areas, magnifying chaotic growth. Tax abatements for malls in the middle of nowhere lay waste to cornfields and forests, sapping the vitality of older communities, especially the heart of the metropolis.

The Post quoted sprawl defenders who typically and incorrectly call the mini-ranch the epitome of the American dream. If affordable, many families would choose reasonably compact walkable neighborhoods with charm, amenities, variety, and mixed uses. People in our region pay premiums to live in places like Capital Hill, Alexandria's Old Town, Leesburg, Ellicott City, and Georgetown.

Increasingly popular are New Community Design (NCD) and the New Urbanism - which are not new, but a rediscovery of the virtues of old American cities and towns. A 2001 nationwide survey by the National Association of Realtors found that 60 percent of the sample favored smaller lots to save open space, 77 percent wanted neighborhoods close to town squares, 86 percent wanted trails and bike paths. Remarkable findings these, considering the barrage of pro-sprawl propaganda over the past half century.

As inflated land costs (and perceptions about crime and schools) drive middle income families far from choice central neighborhoods, their new localities must duplicate the police, water systems, and schools left behind, plus roads to get back to work places, shops, restaurants, and theaters. High taxes required to construct and maintain our over-extended public facilities and services encourage new home seekers to go even farther afield.

It is easy to blame land speculators. But the real culprits are the upside-down property tax incentives, inappropriate infrastructure investments, and land-use policies that spur speculation. These incentives make it profitable to keep prime locations in cold storage, to board up rental housing, and to block the path of normal growth in appropriate city and town centers.

Taking the Profit Out of Sprawl

The challenge is to take the profit out of sprawl so the massive inventory of skipped-over prime locations, cited above, can be put to optimal use. Jurisdictions can deflate high land and housing costs by altering current taxes that favor land holding rather than land using. Then the counties' crutches, short-term palliatives at best, can be discarded. Only then can Smart Growth proceed, saving both our countryside and our communities.