Guest Column

Jolly de Give and Stewart Schwartz

Taking the Stress out of Growth

The evidence is conclusive: Inefficient patterns of development drive up the cost of local government. Here are some common-sense strategies for taming suburban sprawl. 

Twenty years ago a bipartisan Governor’s Commission on the Future of Virginia issued a prediction for the Commonwealth in the year 2000. Continuation of growth and development as practiced at that time, the commission stated, would "place unprecedented stress on local governments.”  

Current trends did, in fact, continue, and Virginia now is suffering the consequences predicted. Like many other states, Virginia is grappling with sprawl--land use that spreads new development farther and farther from existing communities and consumes more land than ever before. This type of development is costly to taxpayers and is leading to loss of our natural, historic, and cultural resources, and to a deteriorating quality of life for many Virginians. The state is rapidly losing rural land to development.

Background

The Commonwealth of Virginia spends millions of dollars every year in economic development grants to attract and retain job-creating businesses in the state. However, these economic incentive programs do not take into consideration their effects on patterns of growth. In practice, some of these investments generate sprawl by subsidizing land acquisition, requiring public expenditure on additional infrastructure, and establishing business sites without regard to existing communities, transit resources, farmland and open space. 

Sprawling development rarely brings about the economic benefits anticipated and can cost taxpayers money. The cost to Virginia of providing infrastructure and services to newly developed areas potentially outstrips the revenue generated. A summary of 40 years of fiscal impact studies showed that smart growth consumes 45 percent less land, costs 25 percent less for roads, 15 percent less for utilities, five percent less for housing, and costs two percent less for other fiscal impacts than current trends of sprawl development. By not tying economic incentive programs to smart growth policies, Virginia is missing an opportunity to save taxpayers money.

Simply spending more money won’t solve the problem. It is more expensive to provide infrastructure for spread-out development than for more compact and traditional towns and cities. As population and jobs shift from already developed areas, the existing public infrastructure such as water, sewers, schools and roads is neglected or abandoned. Simultaneously, the expenses for new infrastructure increase exponentially as these public utilities have to be extended further and further out into the former countryside. A Brookings Institution survey of national studies found an average 11 percent savings on infrastructure costs with smart growth development.

What is needed is a new partnership between state and local governments to better manage and direct growth in Virginia. Yet, the General Assembly has refused requests from local governments for more authority to manage growth and instead has reduced the authority of local governments at least a dozen times in the past 12 years. At the same time, the state itself contributes to the problem through economic development subsidies to companies locating outside towns and cities, through an overwhelming focus on highways that generate more sprawl, and through failure to invest in existing communities.

Recommendations  

• Support Adequate Public Facilities Ordinance enabling authority.  Such authority would allow localities to provide that approval of a subdivision or site plan be contingent upon the availability of adequate public facilities. An Adequate Public Facilities Ordinance (APFO) allows for the staging of development to enable localities to time development to a rationale financial plan and program to provide services such as schools, sewer and water.

• Support broadening the impact fee enabling authority. Currently, Virginia allows the use of impact fees only for roads and only for a few localities. Broadening this authority so that it may be used by any locality and increasing the potential uses of the fees would help local government deal more effectively with the impacts of growth. Such authority would allow localities to impose impact fees for schools, water, sewer and other services and to set them at a realistic percentage of the public cost of new development. Impact fees are charges imposed on new development to help pay for the capital costs of public facilities necessitated by such development. Unlike proffers (which are offered, or “proffered”, by the developer and apply only to rezonings) they are set by the locality and applied across the board to all new housing construction. To make impact fees meaningful, they should not be capped by the General Assembly. Localities must be able to set fees at some realistic percentage of the cost of new development.

• Oppose actions that would further erode local governments’ existing land use authority. This session may see another effort to take away authority as a reaction against local government efforts to develop comprehensive plans and zoning ordinances that reduce infrastructure costs, protect more open space, and create more compact, walkable communities. Possibilities include reducing localities’ ability to change their comprehensive plan or zoning designations. There may be an attempt to take away or unduly restrict proffer authority, which provides for some financial payment by developers for public costs created by new development. Any efforts to weaken local control over the placement of telecommunications facilities should also be opposed; such control enables local governments to lessen the negative impact of these structures on communities.

• Support State actions to direct state investment to towns, cities and areas of contiguous development where public infrastructure is already in place. Funding for state programs such as brownfields redevelopment, Governor’s Opportunity Fund, Enterprise Zone Program, and the Main Street Program should be increased and directed to towns, cities and areas of contiguous development where public infrastructure is in place. Transit, bike and pedestrian projects should receive a larger share of transportation funding. School funding should fairly support the repair, maintenance and expansion of existing schools.

• Support efforts to improve local and state partnerships in planning. The state should analyze long-term development trends, including total land planned and zoned for development, to better assess taxpayer costs. State funding and technical assistance should be provided to improve local planning and support studies such as build-out analyses (for localities or transportation corridors) and water supply assessments.

• Support state action that allows cities and towns to revitalize urban or older suburban areas. Under current law, cities and towns must have the same tax rate on both land and buildings. In recent years, other states have allowed their municipalities to use a lower tax rate on buildings. This lower tax rate has stimulated real estate investment and development because it reduces the property owner’s tax liability on the improvements. By removing tax disincentives, it encourages investment where towns and cities already have infrastructure, rather than having investment leave for the countryside. In Virginia, only Fairfax City has this authority, recently granted.

-- January 4, 2005