Saturday, January 2, 2016

"The Suburbs will Die!"

Visiting my hometown in Switzerland recently I was struck by how the landscape had been preserved over half a century. Yes, there were more buildings, freeways, fancier trains; but the open spaces I played in as a boy were recognizable. This would not be true in Vancouver, or Seattle, or the San Francisco Bay Area, where I have spent my adult life. 

By contrast, development in the United States during my life time has been of the suburban sprawl variety. We built the interstate highway system, built an automobile society, and moved to the suburbs. It's alienating.  We have two or three car garages, a fenced yard, television, radio, and we spend hours on congested freeways. It's crowding out life...., and its a Ponzi scheme, says Charles Marohn.

I've seen suburbs like this flying into Cincinnati, Atlanta, or Chicago;
where is this?

Our kids don't play in neighborhood packs. We schedule them to the hilt, drive them to soccer, drive them to hockey, drive them to baseball, drive them to theater, drive them to ballet. It's an automobile merry-go-round.  It's not good for us, and some urban planners say its not good for cities.

Brad DeLong sends us to an article in Time (July '14) by Leigh Gallagher: The Suburbs will Die--One Man's Fight to Fix the American Dream. Charles Marohn used to be a city engineer/planner in Brainerd, Minnesota. He helped the city grow, sprawl-like, but now he thinks differently.

Marohn ... takes issue with the financial structure of the suburbs. The amount of tax revenue their low-density setup generates, he says, doesn’t come close to paying for the cost of maintaining the vast and costly infrastructure systems, so the only way to keep the machine going is to keep adding and growing. ... 
He likens suburban development to a giant Ponzi scheme. ... The way suburban development usually works is that a town lays the pipes, plumbing, and infrastructure for housing development—often getting big loans from the government to do so—and soon after a developer appears and offers to build homes on it. Developers usually fund most of the cost of the infrastructure because they make their money back from the sale of the homes. The short-term cost to the city or town, therefore, is very low: it gets a cash infusion from whichever entity fronted the costs, and the city gets to keep all the revenue from property taxes. The thinking is that either taxes will cover the maintenance costs, or the city will keep growing and generate enough future cash flow to cover the obligations. But the tax revenue at low suburban densities isn’t nearly enough to pay the bills; in Marohn’s estimation, property taxes at suburban densities bring in anywhere from 4 cents to 65 cents for every dollar of liability. Most suburban municipalities, he says, are therefore unable to pay the maintenance costs of their infrastructure, let alone replace things when they inevitably wear out after twenty to twenty-five years. ...
“When people say we’re living beyond our means, they’re usually talking about a forty-inch TV instead of a twenty-inch TV,” he says. “This is like pennies compared to the dollars we’ve spent on the way we’ve arranged ourselves across the landscape.” 
... In 2010 the financial analyst Meredith Whitney wrote a now-famous report called The Tragedy of the Commons.... [She] said states and municipalities were on the verge of collapse thanks in part to irresponsible spending on growth. Likening the municipalities’ finances and spending patterns to those of the banks leading up to the financial crisis of 2008, Whitney explained how spending has far outpaced revenues—some states had spent two or three times their tax receipts on everything from infrastructure to teacher salaries to libraries—all financed by borrowing from future dollars. 
... [L]ow-density tax collection, sprawling development is more expensive to build. Roads are wider and require more paving. Water and sewage service costs are higher. It costs more to maintain emergency services since more fire stations and police stations are needed per capita to keep response times down. Children need to be bused farther distances to school. One study by the Denver Regional Council of Governments found that conventional suburban development would cost local governments $4.3 billion more in infrastructure costs than compact, “smart” growth through 2020, only counting capital construction costs for sewer, water, and road infrastructure. A 2008 report by the University of Utah’s Arthur C. Nelson estimated that municipal service costs in low-density, sprawling locations can be as much as 2.5 times those in compact, higher-density locations.
Marohn now runs an interesting website, Strong Towns, writing about small town development issues. Here he is in a video explaining some of the disadvantages of low density growth and the advantages of older, denser development patterns.


  1. Jane Jacobs is the correct source on this. She wrote about these issues 5 decades ago, and how the property tax dollar is split between states, counties and cities is a pretty opaque process, but it is too simple to say the cities collect it. (the same goes for sales tax, but I think this is a little better defined, even though it remains unclear to the shopper (in San Francisco the pot gets split two ways, city and state because SF is an anomaly and is both a city and county, for the rest of us there are three pots). Usually cities and towns prefer retail development to housing or office because the revenue stream is well defined. With housing, it is more trickle down and unpredictable and then there are the unintended consequences of delivering services to the new residents, schools, police, roads, ...... It used to be that cities liked elderly housing because they shop and pay taxes without using schools and police.

    Here is a "Link to The Death and Life of Great American Cities

    And here is a link to Jacob's Cities and the Wealth of Nations