Posted on

Development pattern productivity, continued

“No additional financial impacts are anticipated,” claims the staff report accompanying proposed revisions to Northfield’s nightmare land development regulations. Yet the proposed changes will change zoning around Northfield’s downtown to make lower density, less compact development the default pattern and this does have financial impacts for the City of Northfield.

The motivation for the changes is to make development easier and help cure Northfield’s purported reputation hostility to business, developers and development. Yet the discussion has only focused on making it easier and cheaper for developers and not on the longer term impacts for the City of Northfield and its taxpayers.

Mayor Graham was the first (but certainly not the last) person to call me anti-growth and anti-business, so let me say again that neither is true. I wholeheartedly support making the development permit process easy, predictable and cheap for developers. I urge the Council, Economic Development Authority, NDDC, and Chamber to work to encourage business and development in Northfield by retaining current business and attracting new companies.

But, and of course there was a but, I continue to advocate for the City to work to make developing in a pattern which will sustain the City financially the easiest choice rather than changing the regulations to development which is less profitable for the City the norm. Tonight, the Council should have a robust discussion about how to make the most productive use of land in Northfield for the taxpayers and how to help developers make money in the short term so the City can prosper in the long term.

Private development depends on a great deal of public infrastructure water, wastewater, stormwater, and roads.  While developers usually pay for the required improvements (but the proposed business park plans also proposed to subsidize this, too), the infrastructure is all dedicated to the City – to me and my fellow taxpayers – to maintain, repair and eventually replace. It matters a great deal whether the development the City permits can pay for the costs to maintain the infrastructure and some development patterns yield more revenue.

To help the Council consider what I mean about more productive vs. less productive development patterns, let’s do the numbers. Following in the footsteps of Strong Towns “Taco Johns math” in Brainerd and Joe Minicozzi’s work in Asheville, NC (and an additional example from Rochester), I offer three examples of different development patterns in Northfield with taxable market values and tax revenues (from Rice County public records) compared on a per acre basis to compare apples to apples. The downtown block is by far the most efficient and highest producing use of land on a per acre basis.

When considering how to zone and regulate land, the City’s interest should be to guide development in a pattern which produces the most tax revenue for the least cost in terms of infrastructure. The proposed revisions to the LDC help create lower density and lower productivity for the City.

Downtown Block

The development pattern is on a traditional grid street pattern with mostly two-story construction (there are a couple of single story buildings plus the taller First National Bank and Grand Event Center), zero setbacks, and sidewalks. This block has a mix of residential (apartments on upper floors along Division Street as well as an apartment building on Washington), retail and service businesses at street level plus additional business uses on upper floors (this makes for greater density of jobs, too).

Downtown block bounded by Division, Washington, 3rd and 4th Streets
Downtown block bounded by Division, Washington, 3rd and 4th Streets
  • Total acres: 1.71 (not including city parking lots)
  • Total Market value: $4,192,400 (not including value of parking lots)
  • Total Tax revenue (State, county & city level): $148,586
  • Value per acre: $2,451,696 (w/o parking)
  • Tax revenue per acre: $86,892 (w/o parking)

Southgate Mall development, Highway 3

This development was built in 1976, well into the suburban, highway and automobile-oriented phase.  The single-story structure with parking in front on a state highway frontage road is difficult to reach except by car. The sidewalk and new-ish bike trail along the river behind this development get pedestrians and bicycles close, but there is still no direct access. The highway oriented development requires considerably more infrastructure – a frontage road and a state trunk highway – as well as requiring off-street parking for additional distance for pipes and more stormwater runoff to manage.

Southgate development, Highway 3 south
Southgate development, Highway 3 south
  • Total acres: 1.16
  • Total market value: $152,500
  • Total tax Revenue: $4,982
  • Value per acre: $131,466
  • Tax revenue per acre: $4,295

Target/Cub development

Moving further south on Highway 3, the early 21st century big box development of Target and Cub (plus Applebee’s Restaurant) is also single-story, requiring a much greater amount of land for parking and the location at the far south end of town makes it less accessible for many on foot or bicycle.  Additional improvements to highway intersections and local connections streets added to the public cost.

Target, Cub Foods and Applebees development, Highway 3 south
Target, Cub Foods and Applebees development, Highway 3 south
  • Total acres: 26.4 (13.8 for Applebees/Cub + 12.6 for Target)
  • Total market value: $10,721,700
  • Total tax revenue: $446,882
  •  Per acre value: $406,125
  • Per acre tax revenue: $16,927

On a per acre comparison, the denser, multi-story, mixed use downtown block is the clear winner as I’ve argued before, but now provide the numbers.  As luck would have it, the proposed land development regulations share an agenda with a proposed resolution supporting a state omnibus transportation funding bill that provides additional dedicated state funding for city streets (including non-MSA street maintenance, construction and reconstruction).  How much of the pain the omnibus transportation funding bill is trying to solve is self-inflicted by building more than we can afford?

Consider why Northfield and other cities need more money for local roads; one reason is that cities have built a great deal of infrastructure to support very low return development that cannot support itself. Working toward revising how we build can also help change how resilient and prosperous Northfield will be in the future.

 

Posted on

Cycling roundup

What would help you get on a bicycle and ride to the store – yes, you there, the one who hasn’t ridden a bicycle since childhood but might be willing to try it if conditions were right?  People for Bikes has a nice series trying to sell cycling to the uncertain “swing voter.”  I’m even more curious how the completely committed cyclists react, because the overall message is not about how great cycling is, but how to advocate for better bike facilities which make cycling easier for everyone.  No one should be surprised that perceived (lack of) safety is a big obstacle, but more surprising that the safety of better facilities is also not much of a selling point. 

And then there’s all the good stuff about cycling:

Economic benefits of cycling

Building business support for cycling by way of the Missouri Chamber of Commerce.  This piece has a great little 7 step guide to advocacy from within.

The only happy commuters are cyclists, or can urban design make people happy?  Long commutes and the combined cost of housing and transportation costs, while not about cycling, are getting some attention.

And how Groningen, Netherlands achieved cycling greatness.  Spending 15 minutes watching the video is fun and shows real people riding around town.  If you don’t want to spend the time, the secrets are: (1) not a piecemeal approach, (2) connecting places, (3) making cycling easier than driving in some locations, (4) separating cyclists from high speed traffic, and (5) political will.  The other comment made frequently: cycling costs less. Here’s a comparison of British streets and Dutch streets to see how different places allocated space differently to accommodate cyclists and here are all the myths and excuses about cycling in one place.

Who pays for roads?
Who pays for roads?

Is it OK to kill cyclists? asked Daniel Duane in the New York Times.  In the US, if you’re going to kill someone, bumping off a cyclist with your car is a pretty good way to get away with murder.  Even here in England, where the cycling climate (and the regular sort of climate) is quite different, killing cyclists goes largely unpunished (though “my” MP Julien Huppert has been working on it).  Apparently, we’re expendable.

I blogged earlier about strict liability (where the driver of the motor vehicle is presumed liable for the accident, unless she can prove she is not at fault) and “my” MP Julien Huppert has also raised this issue.  In a related development, exposing the “blame the victim” problem with pedestrian and cycling fatalities is on the upswing, see this New York example (police say pedestrians should carry flashlights so cars don’t jump the curb and kill them).

After the NY Times piece, the Economist has a very good summary of the policy and what would happen in a variety of circumstances.  To sum up:

This regulatory regime places an extra burden on drivers. That burden can be summed up as follows: before you turn, you have to check carefully in the mirror to see whether there’s a cyclist there. That’s it. When you are driving in the Netherlands, you have to be more careful than you would when driving in America. Does this result in rampant injustice to drivers when accidents occur? No. It results in far fewer accidents.

 

Posted on

More about development economics and history

IMG_0172
My office…before

I’ve been cleaning out my office at the end of my Council term.  In addition to recycling mountains of paper and gaining a great deal more storage space, I’ve been pleased to discover that my personal policy development has been quite systematic from my days on the Planning Commission to the present.

I even found my first Planning Commission fan mail. This little note from 2002 was sent in response to my questions about one of the residential developments underway at the time and applauding for standing up to the Council which was calling me anti-development.  What I was starting to ask, in a very clumsy way, was what’s the cost to taxpayers of various kinds of development rather than trying to reduce the impact of government on development costs for particular projects (which is what people usually glom onto).

My point all along has been: government is a player in the market (by regulating what can be built, incentivizing/subsidizing certain types of projects, by its tax structure) and as a party to individual development deals like subdivisions, planned unit developments, etc.

While working to develop policy and regulations which do not unfairly burden business (in the short term), the city must also consider its own (that is, taxpayers’) interests in the long term (call it a governance perspective).

Fortunately, many others have started asking the same questions (and/or the internet resources have been exploding to make them more accessible) over the last 10 years and here are a few of the things I wish I’d been able to bring up in 2002 and certainly want to highlight in 2012:

For all that residential development, I wish I’d had The power of greenfield economics ready at hand and been able to speak intelligently about “the proverbial elephant in the room [which] is the amount of sprawling, redundant public and private infrastructure we’ve built since the end of World War II.”

So now, as Northfield struggles to fund maintenance of all that infrastructure it has already built, the city might be able to ask how government policies (from the feds on down) have been part of the problem and how Northfield can look beyond what seem like quick solutions to longer term, sustainable changes which both support economic development without adding to Northfield’s long term debt burden and forgoing tax revenue through tax abatements or other incentives.

And some follow-up:

That NY Times series on subsidies got a lot of attention from the policy people.  MN2020 published its own 2 part series with Part 1 and Part 2 (the more interesting of the two with details of an Iowa subsidy situation).  MN2020  also cites its 2007 report Chasing smokestacks, stranding small business focusing on shifting MN public policy. Strong Towns included links to the NYT series in their Friday Digest.

...and after
…and after

 

 

 

Posted on

Not all development patterns have the same price tag

And for my last Council meeting, the business park is on the agenda for discussion…so here’s one more attempt to ask questions about the cost and scope of this project.

The background as we know it: 530 acres annexed west of the hospital to be master-planned and developed as a business and residential development.  Required improvements include roads (to TH 19, North Avenue, Decker Avenue, 320th Street, “Cedar” Ave. and new interior roadways), sewer (including lift station), water (including elevated storage tank) which “should not be assessed to business park property, increasing the cost of development.”  Phase I is estimated at about $14 million in improvements; Phases II-IV would add another $15 million. The breakdown of the development expected includes not just the commercial/industrial development we hear about most, but a substantial amount of housing and retail.

That cost of development issue should make everyone pause…

Of course, it would raise the cost of development to completely prohibitive levels if the costs were assessed to the property.  But, if the costs are not assessed to the property, that burden will fall to the City taxpayers (and state and perhaps federal taxpayers depending on the package of aid that’s cobbled together).  Further subsidies to attract business like tax abatement, TIF, etc. will further increase taxpayers’ costs and decrease the tax benefits.

1. My general question: how can we grow the tax base and add jobs without massive subsidies (which is what those infrastructure improvements would be) which would effectively shrink tax revenue to pay off the improvements.

2. My more specific question: how can the Council, staff, business community and taxpayers learn how much it is likely to cost them (and what assumptions about the rate of growth and the economy underlie those projections) and will that cost ever be recouped through tax revenue.

3. I also have question the wisdom of master planning an area which will take decades to build out.  My experience on the planning commission with residential development was that the master plan would be drafted, but within just a few years changes would be requested to adjust densities, change housing styles, subtract roads, change stormwater management, etc.  Is it likely that the lot layout, use designations, environmental/landscaping/natural features, etc. in the business park will help development or will the plan constrain business development over time?

My bottom line: Northfield has not evaluated the cost of this project for taxpayers over the long term and has not explored meaningful alternatives to reduce cost.  Indeed, the entire process has been conducted backwards with questions about feasibility, cost, location, etc. happening after the plan has been drawn without considering that not all development locations and patterns come with the same pricetag.

I am advocating for 2 things:

  • maximizing use of current infrastructure before building new (because we’ve already paid for it and are maintaining it). Extending infrastructure in the hope of development is a gamble with tax money I am not willing to take.
  • building in patterns which support density (to put more taxpayers per acre or per foot of pipe to support the infrastructure), but not for a particular look and feel.

A little digest of other things I’ve written and where I get my information:

From this blog (with links to many places):

From other places:

 

 

 

 

Posted on

Different debate questions

Presidential debates usually make me think about moving to Canada since the likelihood of either candidate actually answering a question is abysmally low and the only excitement comes from the random zinger of a comment, factual screw up, or public speaking trainwreck (I depend on the Brits for the most entertaining and pointed commentary and American media for the transcript).  I’d like to believe, however naively, that the President of the United States does more than repeat familiar phrases or score points for verbal jabs in the course of his employment.

I would like some answers from candidates, though, and Chuck Marohn has a different list of questions over on Strong Towns which get at some of the issues I care about. It might be fun to ask them on the local level, too, and see if we can get beyond repeating the usual answers and catchphrases about growth, infrastructure, regulation and the like to ask what would really work and what it would cost.

 

Posted on

Community Conversations report is out

Back in 2011, Northfield was one of 12 cities around the state selected to participate in 4 meetings convened by the League of MN Cities called Community Conversations.  The final report is now out.  The conversations started from the sobering projection that

if cities remain on their current financial path and no policy changes are made, all types of cities in all regions of the state will be broke by 2015.

 

The meetings covered what services cities provide, new ways to provide services, paying for the services and guiding decision makers.  The report doesn’t go nearly as far as Strong Towns does in evaluating how cities have grown and spent money, especially on infrastructure, but it’s a good start and great community engagement.

Posted on

End of the road

I really don’t know how I missed this one, but in 2009 Virginia enacted a law which doesn’t quite ban cul-de-sacs, but makes state funding for street maintenance and services contingent on not building any more of them.  I really don’t know how I missed it because this development was selected by the New York Times as a 2009 Idea of the Year and got a lot of other press.

Why is this noteworthy? 

I’ve been anti cul de sac for years.  Not because I don’t like 3 car garages, as has been suggested somewhere recently.  Not because I am anti-car/pro-bike.  Not because I have some aesthetic problem with suburban development.  Because CUL DE SACS COST MORE – it is more expensive to plow snow, there are very few taxpayers per foot of street surface, and they force traffic onto a few collector streets which are often less direct, longer and wider (more pavement, more cost).

Less direct costs: The lack of a connected street network also makes transit service so inefficient as to be almost impossible (requiring huge subsidy as well as making travel time unreasonable and usage low), makes walking and cycling connections more difficult, and creates traffic issues like those around Northfield’s middle school (which costs the school district more in busing and created a deadly intersection which will cost much to retrofit).  The downstream costs to air quality and public health are only beginning to be calculated.

How Virginia does it: In VA, streets are built then dedicated to the Commonwealth – apparently, much street maintenance is funded at the state level.  Now, before being accepted, the street is reviewed to determine if it “meets or exceeds the public service, pedestrian accommodation, and connectivity requirements.”  otherwise, the street will not be accepted into the network (and the local unit of government is on the hook).

Infrastructure is expensive.  In the future, Northfield needs to understand that not all street patterns come with the same price tag – we need to either transfer the full life-cycle cost of inefficiency to those who would like to build this way or look to changing development patterns for sustainable infrastructure spending.

Posted on

Bicycling and the NRA

 

This is my bike

Bike Advocacy from the NRA Playbook got my attention since I am pro-bike and but not pro-gun.  The idea is not to whip your handgun out of your saddlebag or jersey pocket to shoot the motorist who ran you off the road.  No, apparently the NRA’s success at growing the organization and its almost legendary lobbying power comes from its strategy to make gun ownership something for ordinary people.

So, for cyclists, rather than trying to make riding a bike a special, environmentally-friendly, physically fabulous, morally superior sort of activity, we should be trying to show how regular people ride bikes and you can too.  If we marketed cycling and bicycles in NRA fashion, here’s what author Tom Bowden suggests:

The important lesson is to stay on the main messages — the ones most people can accept.

  • Bikes are good for America! Let people make their own assumptions why.
  • Bikes solve problems! Just let people decide which ones they care about.
  • Bikes are fun! But let the riders decide how and where they like to ride.
  • Bikes are healthy! And riders can decide if they are interested in weight loss or improving their half-ironman times.
  • Bikes are safe! And let people make their own judgment how much protection they need based on the riding they do.

This won’t help with road and street design which overwhelmingly favors cars or funding more complete streets, but I do think making cycling more appealing for regular folks is more likely to succeed than trying to get them to join the lycra-clad, tech-obsessed racing group.

On the flip side, here are 9 reasons not to ride your bike to work which pokes people for making excuses, but also provides some practical advice (like not worrying about having the perfect bike and rain pants).