Oregon’s House of Representatives passed a bill to legalize inclusionary zoning. In memory of Bart Simpson, this should be called the “I Didn’t Do It Act,” as the reason for Oregon’s low housing affordability compared with most other states is the legislature’s continuing support for land-use regulation and urban-growth boundaries.
Inclusionary zoning requires home builders to dedicate a fixed share–usually around 15 to 20 percent–of the housing units they build to low- and moderate-income buyers or renters. Research by economists from San Jose State University has conclusively proven that inclusionary zoning laws actually make housing less affordable. This is because builders respond by building fewer homes and by charging more for the non-subsidized units to pay for the ones that they are required to subsidize.
Inclusionary zoning is legal in California, where housing is far less affordable than in Oregon. But inclusionary zoning is not really about making housing affordable; it is more about assuaging liberal consciences for adopting policies that make housing less affordable. If they can force greedy homebuilders to supply a handful of homes for less than market value to needy people, then they don’t have to feel so bad about everything they did that mucked up the housing market.
Portland is “going to look like San Francisco in 10 years,” predicts real estate broker Douglas MacLeod. That’s because people like him are buying homes, demolishing them, and replacing them with two, three, or four skinny houses–houses as narrow as 15 feet in width but (unlike row houses) with around ten feet of space between them.
This continuing process has enough Portlanders upset that the city council recently voted to require developers to notify nearby homeowners at least 35 days before they begin demolition of a home, not that the homeowners will be able to do much about it. It has also led the Oregonian to commission these interactive graphics showing where homes have been replaced and how fast they are being demolished.
Of course, few are willing to discuss the real answer, which is to abolish or at least greatly enlarge Portland’s urban-growth boundary. The 2010 census found that Oregon is 98.8 percent rural, and more than 80 percent of its residents are confined to the remaining 1.2 percent that is urbanized.
The Antiplanner’s loyal opponent, Todd Litman, has come out with a new report claiming that urban sprawl costs Americans more than a trillion dollars a year. While it is rather quaint that people are still worried about the costs of sprawl, the Antiplanner has to point out that there are several problems with Litman’s analysis.
Many of Litman’s Numbers Are Hypothetical
First, many of Litman’s numbers are hypothetical. He casually presents data describing such things as “optimal regional densities” and “optimal vehicle ownership rates” without ever defining “optimal” or proving that his numbers are, indeed, optimal. In fact, any actual optima change from day to day and to claim that one “knows” what the optima are is to claim an omnipotence that simply does not exist. Such claims are what leads people to think they can engage in central planning which almost invariably leads to more harm than good.
Now that Honolulu’s insanely expensive, low-capacity rail line is under construction (and over budget), Oahu land-use advocates are upset that the city wants to rezone 1,289 acres of farms for residential development. At least some members of the city council claim to have been shocked to learn that just 17 percent of the island is still suitable for farming while 27 percent has been urbanized.
Sadly, efforts to protect farmlands in Hawai’i are something of a joke considering that Hawai’i’s land-use laws–the strictest in the nation–were supposedly passed to protect farmlands and yet in fact are responsible for destroying Hawai’i’s agricultural industry. The land-use laws made Hawai’ian housing so unaffordable that farmers can’t pay workers enough for them to be able to live there. As a result, the state has lost most of its pineapple, sugar cane, and other crop production to other Pacific islands such as Fiji.
Comparing a map of Oahu land-use designations with the route of the rail line reveals that the rail line will cross only a few tiny areas of land zoned for farming. In fact, a lot of the land around Kapolei that is zoned urban hasn’t yet been developed and could still be used for farming, but why bother if you can’t afford to grow crops?
To stop climate change, Al Gore wants to spend a mere $90 trillion rebuilding all of the world’s cities so that everyone is living in such high-density neighborhoods that they don’t need cars. While a few curmudgeonly types might think that $90 trillion sounds like a lot of money, it really isn’t, say Gore and former Mexico president Filipe Calderon. After all, the world is probably going to spend the $90 trillion on something in the next few years anyway, so what’s wrong with spending it on this?
Gore wants to rebuild this dumb-growth city into. . .
Gore made the proposal at an economics conference in Davos, Switzerland attended by billionaires who fly in on private jets so they can tell other people they need to get used to consuming less. Of course, neither Gore nor the other millionaires and billionaires at the conference expect to be stuck living in a high-density apartment any time soon.
this smart-growth city (illustrations by Alain Bertaud).
Supporters of Portland’s authoritarian planning have responded to Portland State University professor Gerard Mildner’s critique of that planning in the spirit of the Christmas season. They welcomed his report, “Density at Any Cost, with open arms, agreeing to have a free and open discussion of the issues.
Just kidding. Instead, they responded like little children, calling Mildner names. “UGB denier.” “Libertarian activist.” “An outlier, unrepresentative of most of our relevant experts.” And that’s just what his fellow academics at Portland State University called him.
Mildner in fact agreed that his views were unrepresentative of others at PSU’s urban planning school. “Hiring in the School of Urban Studies and Planning self-selects for people sympathetic with Oregon’s urban planning system,” he suggests, so it’s clear his views aren’t going to align with others in that school. An economist himself, Mildner works at PSU’s Center for Real Estate, which has one foot in the urban planning school and one foot in the business school–and the Antiplanner suspects Mildner’s views have more support at the latter.
Portland’s regional planning agency, Metro, recently released its 2014 Urban Growth Report, which projects that the region will gain 300,000 to 500,000 new residents between 2010 and 2035. The report suggests that it may not be necessary to expand the region’s urban-growth boundary to house those new residents because people are willing to live in smaller homes on smaller lots.
That’s an extremely distorted view of the future, says Gerard Mildner, an associate professor of real estate finance at Portland State University’s Center for Real Estate. In a paper titled, Density at Any Cost (which was also published in the Center for Real Estate’s quarterly report), Mildner argues that Metro’s report “distorts economic data and will lead the region to make decisions that will harm economic growth.”
Not only will Metro’s vision make single-family housing more expensive, says Mildner, it will increase the cost of rental housing. Contrary to claims that more people want to live in smaller quarters, achieving Metro’s goals will require “multi-billion dollar unfunded mandates on local government to subsidize housing and transportation projects.” Nor will Metro’s plans be good for the environment, since they will just lead a lot of people to move “from our region to places in the southeast and southwest United States where carbon emissions will be higher” because those places require more air conditioning and use more fossil fuels to generate electricity.
The White House has applauded Portland and fifteen other local governments as “climate action champions” for promising to reduce greenhouse gas emissions. Perhaps the White House should have waited to see whether any of the communities managed to meet their goals before patting them on the back.
Take Portland, for example. The Northwest city’s modest goal is to reduce Portland and Multnomah County emissions by 80 percent from 1990 levels by 2050. Planners claim that, as of 2010, the city and county had reduced emissions by 6 percent from 1990 levels. However, this claim is full of hot air as all of the reductions are due to causes beyond planners’ control.
Almost two-thirds of the reduction was in the industrial sector, and virtually all of that was due to the closure in 2000 of an aluminum plant that once employed 520 people. The closure of that plant hasn’t led anyone to use less aluminum, so all it did was move emissions elsewhere.
The evidence continues to grow that so-called transit-oriented development (TOD) is more oriented to subsidies than it is to transit. A new GAO report found lots of places where rail transit failed to stimulate new development. In many if not most of the places it found TODs, “supportive zoning, planning, infrastructure investments, and tax incentives” played a major role in seeing them built.
Based on this, it is not surprising that a suburb along the Minneapolis-St. Cloud NorthStar commuter rail line has had to reduce density expectations in order to attract any development near a station on that line. Similarly, Denver RTD’s latest TOD update admits that one of the lessons RTD has learned is that “trains don’t create markets” (p. 4), and the update proceeds to outline many of the incentives RTD and local governments are providing to see TODs built.
So it is disappointing when The Economist, a magazine that usually does its homework, accepts without question transit agency claims that the Atlanta streetcar will lead business “to soar” for shops along its route. The magazine-that-calls-itself-a-newspaper considers the streetcar to be proof that “Americans are slowly warming to public transport,” when in fact all it proves is that American cities will take federal dollars for any crackpot scheme the feds are willing to fund, even if that scheme involves disrupting traffic and building housing that few people would live in unless it was subsidized.
Debates over Portland-area rail transit and land-use issues typically pit city residents against the suburbs, with urbanites favoring more transit and land-use restrictions and suburbanites opposing them. But a recent poll by Portland’s city auditor reveals that even city of Portland residents are becoming increasingly disillusioned about Portland’s policies.
The complete survey is here. The same survey has been made for each of the last five years, and support for Portland’s land-use and transportation policies in particular has steadily eroded during that time.
The survey found that satisfaction with the city’s policies in general had fallen from 52 percent support in 2010 to 47 percent in 2014. Dissatisfaction was greatest with regard to transportation policies. Where 38 percent thought the city was doing okay on street maintenance in 2010, just 29 percent did in 2014. Where half of the city residents felt they could live with existing levels of traffic congestion in 2010, just 41 percent did in 2014.