Bacon's Rebellion

Democracy Thrives in Sunlight

The Housing Crisis in Fairfax

—

by

James A. Bacon
in

So much to blog about and so little time — I’m still catching up from vacation. Well, here goes…

Reader Tobias Jodter recommends to our attention an Aug. 27 article in the Washington Post describing the housing crisis in the suburbs. Writer Michael Grunwald gets straight to the point in the first paragraph:

In the past five years, housing prices in Fairfax County have grown 12 times as fast as household incomes. Today, the county’s median family would have to spend 54 percent of its income to afford the county’s median home; in 2000, the figure was 26 percent. The situation is so dire that Fairfax recently began offering housing subsidies to families earning $90,000 a year; soon, that figure may go as high as $110,000 a year.

Grunwald clearly understands that the problem isn’t simply a lack of affordable housing — it’s the location of the affordable housing.

The root of the problem is the striking mismatch between the demand for and the supply of affordable housing — or, more accurately, affordable housing near jobs. … when Fairfax housing officials gave me a tour recently, they told me many of their employees now drive a full hour from Warrenton in Fauquier County. The media officer interjected that she drives nearly two hours each way from Winchester in Frederick County. The driver said he lives in Winchester, too.

In other words, housing that is “affordable” to blue-collar and pink-collar families is not “accessible” to their jobs. What homeowners save in mortgage payments, they bleed in the cost (more than $.50 per mile) and time associated with commuting. Grunwald even understands the root causes of the problem:

Minimum lot requirements, minimum parking requirements, density restrictions and other controls go well beyond the traditional mission of the building code and end up artificially reducing the development of safe, affordable housing. The unfashionable but accurate term for these restrictions is “snob zoning.” Suburbanites use them to boost property values by keeping out riffraff — even the riffraff who teach their kids, police their streets and extinguish their fires.

Paraphrasing economist Christopher Thornberg, Grunwald concludes: “The best thing local officials can do to promote affordable housing is to get out of the way — stop requiring one-acre lots and two-car garages, and stop blocking low-income and high-density projects.”

First question: Wow, where did the Post find this guy? He’s good.

Second question: Will any of the Post‘s editorial writers absorb what Grunwald has to say?

Share this article

ADVERTISEMENT

(comments below)

ADVERTISEMENT

(comments below)

Comments

30 responses to “The Housing Crisis in Fairfax”

  1. Toomanytaxes Avatar
    Toomanytaxes

    Fairfax County supervisors have been spending money to preserve affordable housing. The last two budgets have included one penny on the tax dollar, now worth about $22 M, for affordable housing. What the County has not done is to seek cash proffers from commerical construction for affordable housing, which is done in San Diego, for example. Given that the Fairfax County Chamber of Commerce is first in to support higher taxes, its membership should support a fee on new commercial and industrial construction to help provide affordable housing for the lower-income individuals who will work in these new buildings.

    The article continues the myth that dense housing equals cheaper housing. Unless the county is going to allow tar-paper shacks five feet apart, most new dense housing will be expensive. Land in Fairfax County is costly, which drives builders to construct as densely as possible except for those buyers willing to pay extra premiums for large lots. There is a tendency to build high-rise buildings on the most expensive land, but the evidence strongly suggests that construction costs for high-rise buildings are steep. A new 19-story condo complex at Tysons Corner will offer one-bedroom units starting at more than $500,000. A strong argument can be made that, because of sheer numbers alone, the market demand for lower-priced housing is larger than the demand for high-priced housing. Yet, builders are addressing only the latter in dense areas.

    Moreover, those who preach density as a solution ignore consumer preferences. Many people do not want to live in a condo in an urban area. They want a single family home and will move to locations where that type of housing is available. That’s what this spring’s Census Bureau report shows. While cost is clearly a factor, I strongly suspect that the individuals interviewed who drive long distances also prefer the houses they own to condo or apartment living.

    Mr. Grunwald’s argument for less zoning protections also flies in the face of citizen desires. What would fewer required parking spaces deliver? Absent fewer cars in a community, it would deliver cars parked along streets and probably in other neighborhoods. I submit that few people, regardless of their income levels, want these results. Likewise, there have been many complaints from residents of all income levels about over-crowding and the illegal conversion of single family homes to multi-family housing. Indeed, if the data were known, I suspect that more complaints come from lower-income communities than from more expensive ones. Most people, regardless of their incomes, want the protection of zoning.

    Mr. Grunwald’s arguments also ignore the reality that Fairfax County’s public infrastructure is already overstretched. How does pouring even more people into the county help that problem? The quality of life in Fairfax County has steadily been heading south because of over-development and escalating taxes.

  2. Ray Hyde Avatar
    Ray Hyde

    When I saw that line about getting officials out of the way, I assumed you had ghost-written the article for him.

    Is there actually a requirement for two car garages? I’ve never heard of such a thing.

    That comment doesn’t only apply to Fairfax. It applies everywhere, because building and lot restrictions in outlying counties also affect the market by reducing competition and denying alternatives to those that don’t need to work in the inner areas.

    But even Grunwald concedes that more density is not the total answer when he describes the demolition of the high-rise hell holes that formerly represented our attempts at affordable housing. In any case, we are reaching a limit to what density can achieve economically. The Post has another article the following day that reports on the unavailability of industrial properties in the district as they are increasingly being redeveloped for higher use. Grunwald reports that 88,000 families have moved out of Fairfax, and urbanites are also apposed to overdevelopment and more traffic congestion. REcently I noticed a report saying a developer had broken ground on the “last available space” in Reston Town Center.

    Mandatory inclusionary zoning can’t be the answer either, because it only raises the costs of the remaining units. Not even a housing crash will help, Grunwald notes, because that would reduce building. With so much demand, a real housing crash is unlikely.

    The Fairfax housing authority has 20 single room apartments for day laborers in its own offices. Is this the ultimate in job and housing mixed use, or does the housing authority just not understand the difference between housing and homes?

    But Grunwald really hit it on the head when he pointed to the mismatch of housing near jobs. Fairfax is actively promoting still more job growth when they don’t have the plans to either house or transport the people who will fill them. If we are going to link transportation to land use, why not link jobs to land use. If we can prohibit land use where there are not adequate facilities, then the obvious land use that causes the most demand for facilities is land uses that create jobs.

    We have plenty of affordable housing, and plenty of little used roads, all we have to do is supply them with jobs. Whether Loudoun County opens or closes the door to development at Dulles South and the rest of the county, the result either way will be bad for Fairfax, because neither move addresses the jobs imbalance.

    Ed Risse points out that at 10 people per acre we only need 700,000 acres to house everybody. That sounds fine until you realize that is equal to four famililies per acre, or everybody living on quarter acre lots. And that is with no streets or parks.

    Fortunateley, it doesn’t take a lot of area developed at hundreds or thousands to the acre to free up a lot of land for other uses. But as Ed also points out, the urban footprint is much larger than the land that is used. Even as expensive as urban land is (because of all the infrastructure it requires) it still isn’t paying its own full locational costs: it is absorbing enormous resources from the outlying areas, and returning nothing.

    As it stands now, those other uses, the ones Ed so conveniently ignores in his ten people per acre argument, are also crowding each other out. Urban residents are demanding more open space, not less, which is one reason industrial operations are leaving the city: they need more space.

    So what is the problem? If we only need 700,000 acres, why not double that amount and cut the housing costs in half? After 250 years of development, we are using less than ten percent of the land and we have permanently conserved 20%. At this rate, in another five hundred years we will have developed 20% and conserved 60%.

    At some point both the Fairfax Economic Development officials and the conservation movement are going to have to come to some accomodation for their respective insatiable demands for more.

  3. Ray Hyde Avatar
    Ray Hyde

    I recently had a conversation with a man that does consulting for airport expansions. He described how airports have a maximum workable size. At some point the additional infrastructure required to support still more passengers becomes more expensive, and less reliable. It is no longer feasible to expand the airport, and the result is new feeder airports.

    It immediately struck me that this is the perfect metaphor for what is wrong with our cities. At some point, it just doesn’t make sense anymore.

  4. Jim Patrick Avatar
    Jim Patrick

    Fairfax County prices are higher than other areas from two causes: natural pricing and artificial inflation. Grunwald’s point —ignored in Toomanytaxes’ reply— is that residential prices are artificially driven sky-high by government policy.

    In every region, there is a fiscal balance between wealth-producing industry and resource-absorbing residences. Whether deliberate or not, Fairfax has been balancing the costs of residences on the backs of neighboring jurisdictions far too long.

    We’ve heard all the NIMBY buzzwords before: overdevelopment, congestion, overcrowding, overstretched infrastructure, etc ad nauseum. Grunwald lists them in the article, then Toomanytaxes repeats them verbatim as arguments. Grunwald lists them in the article, then Toomanytaxes repeats them verbatim as arguments.

    Toomanytaxes says:
    “Most people, regardless of their incomes, want the protection of zoning.” We understand what’s meant. It’s protection from those people. ‘Put those people in some other county.’

    It’s snob zoning. No need for quote marks either, snob zoning is what it is.

  5. Jim Patrick Avatar
    Jim Patrick

    Re: maximum workable size, where Ray Hyde says “the perfect metaphor for what is wrong with our cities” Sorry, but it’s not what’s wrong with all, or even most, cities.

    It’s a far better metaphor for suburban and rural housing developments where the majority commute.

  6. Toomanytaxes Avatar
    Toomanytaxes

    Jim Patrick, what evidence do you have that Fairfax County has sufficient infrastructure to support additional development? Please be specific as to schools, parks, sewer, roads, mass transit, fire, police, libraries. Also, please specify how additional facilities should be financed.

  7. Jim Patrick Avatar
    Jim Patrick

    Financing of infrastructure has always been from taxes. If yours have gone toward non-essential projects, that’s your problem; not the state’s.

    The recently authorized proffer system helps with initial capital costs of infrastructrure too. Lots of developers are more than willing —happy— to build the infrastructure themselves.

    Other jurisdictions manage this, and many manage with (reasonable) taxes alone.

  8. tobias jodter Avatar
    tobias jodter

    TMT has the analysis exactly correct. The people like myself who actually live in FFXCO do want zoning protections to protect our quality of life. Parking is a major issue in FFXCO right now even with existing parking requirements. HOA’s all over FFXCO are creating Community Parking Districts to get some control over parking.

    In Centreville I frequently see vehicles parked in open common areas (killing grass) and even on sidewalks. But I suppose it is rude to complain that my wife and kids have to step out onto a busy road to walk around a vehicle parked on the sidewalk. We should be happy that FFXCO is cheerfully doing it’s best to increase density and bring more people in. After all, I can move somewhere else…

    Whether it would solve the problem or not the last thing most residents of FFXCO want is increased density. Condescending name-calling (snob zoning) is not helpful.

    I live in the most middle of middle class neighborhoods. We are not snobs. Is it just my imagination that I see miles of time-consuming traffic congestion every day? I should be happy that our neighborhood schools have dozens of trailers and over-crowded classrooms?

  9. Ray Hyde Avatar
    Ray Hyde

    “In every region, there is a fiscal balance between wealth-producing industry and resource-absorbing residences.”

    Well, there you go, if Fairfax has been balancing the costs of resdences on neighboring jurisdictions for too long, then that supports my argument that it is the urban areas which are not paying their own full locational costs.

    How about if Fairfax just annexes Loudoun and PW? Then Fairfax would have plenty of residences and plenty of jobs, and all the problems would be solved. WRONG, the jobs would still be overconcentrated.

    I don’t understand your argument about maximum workable size. Here is an expert, whose job it is to help airports get bigger and more efficient. Only he says that at some point it is no longer possible, let alone cost effective.

    Why shouldn’t cities be subject to the same restraints?

  10. Anonymous Avatar
    Anonymous

    Per the article, “In the past five years, housing prices in Fairfax County have grown 12 times as fast as household incomes.”

    Duh. That’s because your living in a housing bubble (at least in NOVA) driven by speculators investing in single family homes.

    Check out this article from CnnMoney.com – http://money.cnn.com/2006/08/27/real_estate/pluggedin_tully.fortune/index.htm

    It address certain “myths” that influenced the real estate industry over the past several years. They are;

    1) Myth #1: As long as job growth is strong, prices can’t go down

    2) Myth #2: The builders learned their lesson in the last downturn. They won’t swamp the market with new houses when the market turns

    3) Myth #3: Low interest rates will keep values rising, or at the very least, put a floor under prices

    4) Myth #4: restriction on development in the suburbs ensures low supply, and guarantees rising prices

    p.s. Did anyone hear that the new total for Dulles South is not 28,000 new homes…it’s 35,000?

  11. Ray Hyde Avatar
    Ray Hyde

    “according to a report by the Center for Regional Analysis at George Mason University.
    By 2025, the region is expected to add 1.5 million jobs and to grow by 786,900 households, the report said. According to a jobs-to-household formula calling for 1.6 jobs per household, the region will have a total of 218,200 too few housing units by 2025″

    That is an old report, but I think th recent ones are much the same. It may be that we are in a housing bubble, when it really bursts, then we will know, and you can come back and crow then. But the article also pointed out that even a market downturn won’t help. The reason is that the underlying demand is too high, as noted above.

    Do you suppose that Dulles South is growing from 28,000 units to 35,000 units because the bubble is burting?

    It is easy to point the finger at nameless speculators, but I don’t see it happening in my neighborhood. All of my neighbors have been there for years, if not decades, and the turnover I know of is mostly from people dying off, or finally cashing out to retire.

    I’ll agree there may be some speculation in condos, especially in a pre-build condition, but how many people can really afford to speculate on an $800,000 SFH?

    Sure, homes are an investment like anything else, and the prices are subject to ups and downs. I know of a home that is for sale because the owner is an airline emplyee whose pay has been slashed several times. Like many other people he can no longer afford the home he already has. At the same time, putting his home up was a last resort, precisely because it is his home, not just an investment.

    We can argue about causes and myths, but in the end people will still need homes, and a cubicle does not suit everyone’s needs.

  12. Larry Gross Avatar
    Larry Gross

    Note the WaPo this morning:

    Development Debate Escalates in Loudoun
    http://www.washingtonpost.com/wp-dyn/content/article/2006/08/29/AR2006082901384.html

    re: density. Does anyone remember the recent event called Reality Check?
    http://www.uli.org/AM/Template.cfm?Section=Press_Releases1&CONTENTID=12019&TEMPLATE=/CM/ContentDisplay.cfm

    The basic premise is that over the next few years a bunch of new jobs and a bunch of new people will come to the Washington Metro Area and the purpose of the exercise was to decide where to put those people and jobs.

    One of the ground rules was that neither people nor jobs could be directed to other jurisdictions and areas (because they also had their own predicted influxes of jobs/population – so it was up the the Washington Area to figure out what to do with it’s own projected people/jobs.

    The outcome of the Reality Check exercise was, essentially, the designation of areas for higher density – as the solution.

    Part and parcel was general agreement that mixed-use development was a better way to integrate jobs and homes and reduce the need for more interstate-sized highways to exurbs.

    Go to the URL and look at the list of people and organizations that participated. They range from “interest” groups, politicians, planners, jurisdiction officials, developers, business owners, etc.

    I’m not saying they were right or wrong only that there was quite a wide diversity of interests represented and a heavy majority voted for higher density – in designated areas where there were comprehensive mobility options.

    So I do think the debate in this blog basically has gravitated to advocating moving BOTH jobs and people to the exurbs.

    Note that that three exurbs, Loudoun, Stafford and Spotsylvania grew in the last five years at the rate of 50% (82000), 26%(16000) and 25% (15000) respectively.

    NoVa in the same timeframe grew by 14% (293,000)

    Okay – my point.

    In the next five years – it is not unreasonable to assume that NoVa will gain another 200K people and at the same time Loudoun, Stafford and Spotsylvania and other exurbs will also gain population.

    Ray has advocated pushing jobs to the exurbs. Is this realistic?

    Others have advocated not increasing density in NoVa and, in effect, pushing more population to the exurbs. Is this realistic?

    Unless the State and Local governments of NoVa put up a sign saying “no more businesses and no more people”, isn’t it more realistic to assume that both will continue to increase in the NoVa region?

    If this is the likely reality – then what is the response?

    Oh.. and I can very much assure everyone that the concepts of more peole and more congestion are very well understood in the Washington exurbs also and not suprisingly, their responses sound very similiar to some folks in NoVa – i.e give us the NoVa jobs and keep more people from moving in (to the exurbs). 🙂

  13. Toomanytaxes Avatar
    Toomanytaxes

    We will continue to see sprawl for a couple of reasons: one) many people don’t want to live in a condo, but want to live in a single family home; and two) the high price of land the closer one gets to D.C. provides a strong incentive to build densely and the costs for constructing high-rise buildings is much greater than for building lower-height structures.

    I’m not arguing there’s no market for condos. There is, but I’ll submit the demand for single family homes is greater and will continue to be greater for the foreseeable future.

    Humor me for a few moments by presuming that I am correct. If so, where should these policies lead us? I submit that it’s right back to Ray Hyde’s (and now my) position that we need more good paying jobs outside the Arlington-Alexandria-Falls Church-Fairfax area. We also need more good-paying jobs outside the next ring (Prince William-Loudoun) in places such as Stafford, Fredericksburg, Fauquier, Winchester.

    EMR argues for balanced communities, but does that mean all jobs must be in the inner tier or even second tiers (as I define them). Sure, we may have more condos in the first tier, but we still need more jobs in outlying areas. Isn’t that better than trying to force people to live in one-bedroom condos that cost $500K when they’d rather live in Warrenton with a back yard?

  14. Jim Bacon Avatar
    Jim Bacon

    TTM, You note that most people prefer living in a single-family home vs. living in a condominium. That is, no doubt, true. But people want lots of things they can’t afford. I’m shopping for a new car right now, and I’d really, really like a Mercedes convertible. I can’t afford one — not even a used one. Maybe I’ll settle for a Toyota Solara… or a Ford Mustang.

    I want filet mignon. But I end up buying a lot of hamburger.

    I want the latest, $3,000 big screen TV. But I end up buying yesterday’s technology at a lower price.

    The same applies to buying a house. People can’t always afford what they want — especially if they define what they want not only in terms of the size and amenities of the house and the size of the yard but the accessibility of the dwelling.

    Most people want to live in a big house on a big lot. But they also want short commutes and driving times. A free market — not government zoning policies — should be the arbiter of how people sort out competing wants. (As always, I add the proviso that the concept of “free markets” in housing choices implies a level playing field, e.g. that people pay the location-variable costs associated with their choices.)

  15. Anonymous Avatar
    Anonymous

    Toomanytaxes nailed it right on the head when he said, “We also need more good-paying jobs outside the next ring (Prince William-Loudoun) in places such as Stafford, Fredericksburg, Fauquier, Winchester.”

    I live in Winchester. Most of the population that lives (sleeps) here works in Fairfax or in Manassas. A lot also work at Dulles. My point is they don’t work here.

    Case in point – A family member that works in Fairfax commutes 2-2.5 hours each way everyday and it’s getting worse. By her own admission, she said there will come a time when it’s not worth commuting that far to her job (she recently said that if gas hit $4.00/ga. she was done). She also pointed out that with all of the new development, traffic will prevent her from making the commute, regardless of what gas costs.

    I don’t know what the answer is, but decentralizing some of the good paying jobs sounds like a good place to start.

  16. Toomanytaxes Avatar
    Toomanytaxes

    Jim, I agree in part, but disagree in part. People should be able to choose where they want to live, but also should pay the associated costs. If I move to Stafford County, but work in Alexandria, rather than live in Fairfax County, I’m going to have a much bigger house/lot for my dollar, but I’ll need to pay much higher commuting costs, both in terms of gasoline, etc. and time lost. Moreover, those commuting costs are going to increase as most new highway capacity will be in the form of toll lanes.

    My alternative choice is to live closer to my job. For the same amount of money, I would be able to purchase or rent a lot less house for the same amount of money. But my commuting costs will be much less. These are simple trade-offs. I think we both agree so far.

    Where I disagree with you is onthe idea that dense construction in Fairfax County will provide affordable housing. (I would first, however, concede that, in the event Fairfax County were to eliminate or substantially reduce its zoning requirements, builders could construct less costly housing. But query: Does Houston, which has no zoning, build more affordable housing or do builders there still construct more expensive housing based on the price of land, market conditions, etc.?)

    But I would still submit that the construction of condos in Fairfax County are not going to provide affordable housing. Probably the most affordable housing to construct would be low-rise, garden apartment/condos. A builder could create many more of these units on a given number of acres than it could build single family homes or even townhouses. But that’s not what’s being proposed for Fairfax County. The development proposals are for high-rise buildings (which are more expensive to construct) with big-ticket condos or apartments.

    Indeed, some of the proposals in the Tysons area would eliminate lower-priced garden apartments in favor of high-rise buildings. Building densely in Fairfax County means less affordable housing and not more.

    Another example is Pimmit Hills in the McLean-Tysons area. This is an area of small, but generally very well-kept, older homes on smaller lots. It is the closest thing to Pimmit Hills is a very important part of the community. Many of us want to see it preserved. But now, we are starting to see proposals by developers to purchase these homes on a large scale and to replace them with more expensive housing, much of which would probably be condos or townhouses. Any redevelopment in the Pimmit Hills area will result in less, not more, affordable housing, which, in turn, pushes potential buyers to look farther out.

    Density in Fairfax County does not and cannot equal affordable housing. Rather, it is more likely to result in less affordable housing. Less affordable housing equal more sprawl.

    Logic continues to push me to agree with Ray Hyde — Virginia needs more places and not more dense places.

  17. Toomanytaxes Avatar
    Toomanytaxes

    One of my paragraphs has some words missing. It should read:

    Another example is Pimmit Hills in the McLean-Tysons area. This is an area of small, but generally very well-kept, older homes on smaller lots. It is the closest thing to affordable housing in this close-in area. Pimmit Hills is a very important part of the community. Many of us want to see it preserved. But now, we are starting to see proposals by developers to purchase these homes on a large scale and to replace them with more expensive housing, much of which would probably be condos or townhouses. Any redevelopment in the Pimmit Hills area will result in less, not more, affordable housing, which, in turn, pushes potential buyers to look farther out.

  18. Jim Bacon Avatar
    Jim Bacon

    Anonymous 9:11, decentralizing jobs sounds like a wonderful solution. As I’ve argued before, some jobs will decentralize, following home owners to their peripheral jurisdictions. These are predominantly retail, professional and service jobs that serve the consumer market. But the primary jobs — the jobs tied to national and international markets — are far less likely to move to the periphery. The reason is that employers seek the largest possible labor market for their operations, so they have the widest choice of job applicants. Moving to the periphery of a metropolitan area reduces the geographic scope of the labor pool. Staying closer to the core makes that labor pool larger. Additionally, high-tech companies, which predominate in Northern Virginia, benefit from being in close proximity to each other. These businesses thrive on vendor/supplier/partner relationships that are best maintained through personal interaction. Moving key personnel to Winchester or Fredericksburg would be totally counter productive. The best we can hope for is to move back-office operations out of the core and to less expensive places on the periphery. But once you’ve made the decision to de-couple the back office operations from the main business, you’re competing with localities all around the country, and even the globe.

  19. Anonymous Avatar
    Anonymous

    Jim, I know you’ve said this before, but I think you’re wrong. Here’s why.

    First, when you’re claiming “peripheral jurisdictions” are primarily secondary jobs, you are including PROFESSIONAL jobs, which IMHO are primary jobs – not secondary ones.

    When you look at where folks WANT to work, and where employers seek the largest possible labor pool, the periphery is indeed extremely attractive. For example, Innsbrook, in Short Pump west of Richmond, is FAR easier to recruit for than downtown for high tech professionals – and in fact, a very substantial number (possibly a majority) of the area’s high tech jobs are centered there. Not downtown.

    Hi tech companies inter-company networking is primarily done by sales and management. Not the worker bees who actually do the jobs. A lot of that networking is done by driving to various locations, not by close proximity.

    Moving key technical personnel to Winchester or Fredericksburg would not only be productive, but would probably be welcomed by most of the employees, AND would make sense. If you consider everything except top management and sales to be back office …. gosh, I don’t even know where to start.

    I’ve been in tech for 20 years, and have done a good bit of consulting. What I see and what I know works does not jive with your claims. I just can’t buy your argument.

  20. Jim Bacon Avatar
    Jim Bacon

    Anonymous 10:03, by “professional” jobs, I’m referring to doctors, lawyers — people who practice their trade locally. But they don’t drive the economy.

    The businesses that drive the economy are those who trade nationally and internationally. The fact is, these businesses are locating in Alexandria, Arlington, Tysons and Herndon/Reston/Chantilly. They’re not locating in Winchester, they’re not locating in Warrenton, and they’re not locating in Fredericksburg. OK, a handful are, but they’re insignificant as a percentage.

    As the cost of office space soars in the metropolitan core, commuting times lengthen, and as the cost of gasoline rises, we can expect these primary businesses to begin moving back-office functions to lower-cost locations. That’s capitalism 101. But the core business functions are not moving. I track this closely on one of my other newsletters, VA Newswire, a weekly business digest that highlights, among other things, expansions and relocations. I’d like to see your evidence that suggests otherwise.

  21. Ray Hyde Avatar
    Ray Hyde

    Reality Check only considered jobs above $70,000, and they assumed that there would be considerble job sprawl along the I70 and Dulles Corridors. Their starting premises were not based on MCOG projections, and the ground rules were designed to create a preconcieved outcome.

    It was a nice idea, but in the real world those ground rules won’t apply: some people and businesses will go other places if they don’t find what they want here.

    If we are going to live in a somewhat free society, we are going to have to accept the idea that millions of people will make decisions we don’t understand individually, let alone collectively. Nobody likes change and confusion and disorder, but chaos is an effective way to lower overall energy costs, like it or not. That doesn’t mean that we can’t charge them a fair price to implement the decisions they make.

    I’m just not convinced that the proposals often made here have any connection in reality to what things actually cost. If cities are so much more efficient, why aren’t they cheaper and have lower taxes and less dirt, pollution and congestion? Where is the evidence?

    It is not my problem if people want incompatible choices. It is partly my problem if the government pursues policies that make my life and everyone else’s more difficult and expensive. If Fairfax is sucking up all the jobs and exporting all the houses, then who is it that isn’t paying their fair share, and who is responsible for the bad results from such planning? It becomes more of my problem if I’m expected to pay 60% of the fare fore someone elsr to travel on Metro, in a failed attempt to alleviate the mess. It is even more of my problem when I’m prohibited from competing with those areas.

    I have enough land that I could start a business here, tomorrow. I could even build houses for my workers to live in. I’m within a mile of an interchange on an interstate that was built across my land, but I’m prohibited from any kind of development that might make use of it, simply because someone else has a plan for what I should do.

    I’m sorry, but that is stark raving nuts.

    I’ll agree, that as things are going, it won’t be long before you cannot afford the commute, and it is impossible anyway. But if you also cannot afford the rent, what choice is left? I know professional people who rent a room to flop in during the week, like migrant workers, and visit their family on weekends. Is that what we want?

    TMT is right, Pimmit Hills is a cute little community. In some ways it is similar to my neighborhood, and they are both coming under increasing pressure to sell. I hate to see it happen, but the way you release the pressur is to open the vent, not close the throttle.

    Pimmit Hills got there because it decentralized from someplace else, but where will the next Pimmit Hills happen? Where will it be allowed to happen?

    I’m sorry Jim, but your Primary jobs argument is just elitism, and it is similar to the problem with reality check. Try living on $30,000 a year: that’s a reality check. You are partly right about jobs, you don’t want to locate too far from where the most homes are, but you also don’t want to locate too far from the homes where your class of workers actually want to live. But Ed’s arguments about what we need are simply in wild denial of what is happening. What is happening defines what we need, not what we would like to happen. We can nudge the river one way or another, for a while, but reversing its flow is probably out of the question and undesirable anyway.

    The article was right. We need to get out of the way, and accept/deal with the results, as the best way to make the most people happy.

  22. Ray Hyde Avatar
    Ray Hyde

    I have a neighbor who parks his business trucks in the yard, and I don’t like it. The problem isn’t that the trucks ar parked. They are going to park somewhere, and there is nothing I can do about that.

    The problem is that I don’t like it. But that is a problem I can fix immediately and at no cost.

    We can solve a lot of our problems with a little more tolerance.

  23. Anonymous Avatar
    Anonymous

    The businesses that drive the economy are not just those that trade nationally and internationally – small businesses actually generate more economic activity, and jobs, than large ones.

    Where do I get my evidence? Talking, every day, to people who actually do technical work – about where they actually work (often not where they’re counted – many from home or at a consulting site – including many who are not officially telecommuters), where they want to work, where they want to live, what they’re looking for in a job – both actually interviewing techies for jobs, and talking to friends.

    Look at where people want to live – a significant percentage WANT to live further out. Quantico/FBI and similar outlying large employers are getting their pick of techies – they aren’t having problems filling the many technical jobs they advertise. UVA and the many companies around C’ville that hire techies are finding that those jobs get lots of good applicants. It’s TOUGH for a techie to get a job either place – and C’ville in particular has a definite uptick in technical jobs. So much for the “labor pool” argument. The employers are actually lagging the desires of their workers here.

    People want to live in nice places. Many define that as a single family home w/a yard, not jammed into a third-story shoebox apartment.

    Places like UVA and Quantico are thus able to hire excellent people at a reasonable cost. C’ville has seen an uptick w/the number of firms hiring techies – I think F’burg is starting to as well. IMHO this is probably a better approach, and a healthier one, than jamming people together like sardines in a can.

  24. Anonymous Avatar
    Anonymous

    I am going to throw a little more fuel on the fire by pointing out this article from the Washington Post, http://www.washingtonpost.com/wp-dyn/content/article/2006/08/29/AR2006082901543.html

    It begins, “The three most prosperous large counties in the United States are in the Washington suburbs, according to census figures released yesterday, which show that the region has the second-highest income and the least poverty of any major metropolitan area in the country.”

    Now, I am not an economics professor, but one would think that locating or running a company in one of the top 3 wealthiest jurisdictions in the nation is not really a smart business move. Labor can be found cheaper in EVERY OTHER LOCALITY in the nation. Like the old saying goes, “It can be lonely at the top.”

    If you factor in all of the variables, i.e., cost of housing/traffic/cost of labor/cost of commercial space/taxes, etc., NOVA could quickly lose its luster not only for large companies, but also for smaller/medium size companies.

    After following all of the posts on this thread I’ve come to the conclusion that we are all essentially saying the same thing. That thing is “balance”, or lack thereof.

    IMHO the region is dangerously out of balance. The question then becomes how do we fix it and how long will it take.

    I don’t claim to have the answer but more of the same old same old in terms of housing, job location, etc., is leading us down a slippery slope.

  25. Toomanytaxes Avatar
    Toomanytaxes

    10:45 I think that you are saying what many people don’t want to hear. Because of its proximity to Washington, D.C., NoVA will always have considerable business activity. But much of that activity depends on government contracts. Whoever wins the 2008 presidential election is unlikely to spend as much on defense and homeland security agreements as occurs today.

    The cost structure in NoVA is also getting out of line. New York, Boston and parts of California lost some businesses when costs became excessive and the economy slowed. Do we feel that we are immune to this? Do we really think that NoVA is so desirable to business that economic factors are immaterial?

    By permitting insane levels of growth that exceed the capacity of public infrastructure, we see both a declining quality of life and ever-escalating property taxes in NoVA. If the truth be known, there are probably a lot more people who feel “stuck here” than our local booster community would like to hear.

    Moreover, many of our proposed solutions to problems are designed solely to enrich a few vested interests, rather than to address the problems themselves. Witness, for example, the Governor and the Senate’s recent quest to increase taxes for transportation despite clear evidence that VDOT is broken and the the public does not want government actions that only encourage more development. While the Governor and some senators seem to be returning to the middle, will we really see reforms of the CTB? Will we see proposals to fund transportation facilities based on economic and engineering data? Or will we continue to see VDOT’s efforts to promote the Western Bypass, which just happens to be planned to touch the landholdings of a number of well-connected developers and land speculators?

    Similarly, why are we proposing to spend $4 billion, before cost overruns, to build the Silver Line despite the State’s own admission that it will not improve traffic congestion? If we truly care about the economic well-being of NoVA, why should we spend so much money just to enrich a few landowners at Tysons Corner?

    We have extremely high costs, a shortage of public infrastructure, construction costs that are increasing well above inflation (source: Association of General Contractors), and state and local government transportation programs that are dysfunctional. 10:45, you have well-described the situation. As I wrote yesterday, we need to see good-paying jobs follow the housing growth for the good of NoVA, exurb NoVA and all of Virginia.

  26. Anonymous Avatar
    Anonymous

    Toomanytaxes, those are excellent observations.

    I’d like to add one more thing and that is that the WAPO article actually scared the hell out of me.

    Has our federal govn’t become so big and expansive that it now supports and maintains three of the most prosperous counties in the United States? Why don’t they just move the whole damn thing to Palm Beach or Maui? At least they would be in “paradise.”

    That’s crazy.

    -Anon. 10:45 PM

  27. Ray Hyde Avatar
    Ray Hyde

    My suggestion is to move the Senate to Hawaii, and the house to Florida. If we keep them apart maybe they can do less damage.

    Then move Agriculture to Iowa, Defense to North Dakota, HUD to NYC, we can split Homeland Security between Mexico, Pakistan, and Iraq, and put the Dept. of Natural Resources in New Jersey.

  28. Ray Hyde Avatar
    Ray Hyde

    We’d be better off if we just GIVE the money for Metro to the Tyson’s landowners. At least that way we wouldn’t be stuck with continually escalating demands for the dedicated funding stream to keep it operating.

  29. Groveton Avatar
    Groveton

    Interesting discussion. In the interests of full disclosure, I grew up on Huntington Avenue near Rt1 (Fairfax County). I now live in Great Falls (Fairfax County). I have lived in high density affordable housing and housing in snob zoning areas. I have also traveled the US and the world in my job. So, IMHO, I understand the rapid-growth situation in Fairfax County and I have seen the same problem solved in other places. One epidemic issue in high cost areas is finding housing for policemen, teachers, fire fighters, etc. This was the original point in the Post article and it’s the issue I’ll address now.

    1. The locality has to either pay its police, fire fighters, etc. more or has to offer subsidized housing or both. If he keeps with his identity toomanytaxes will say that this is an effort to raise taxes. It is not. There is plenty of tax money available to Northern Virginia. The problem is that the money doesn’t stay in Northern Virginia. According to the Connection newspaper, in 2002, Loudoun County residents paid $458.3M in states taxes and the state returned $102.9M to the county. This siphoning of money from Norhern Virginia to “prop up” downstate Virginia has to stop. The money is needed here. I belive that it was in 1863 that a number of counties in the western part of Virginia seceded from VA and became West Virginia. Northern Virginia needs to consider this approach. Even annexation with Washington, DC or merging with West Virginia would be preferable to the present situation. Both DC and WVA represent far smaller “boat anchors” than downstate Virginia. If only as a threat, sucession from Virginia would get the attention of the greasy fingered, pork barrel politicians in the General Assembly. They know full well the economics of Virginia without Northern Virginia. In fact, there’s an old joke that asks, “What’s the difference between Mississippi and Virginia?”. The answer is “Fairfax County”. OK – I know that the real joke is Mississippi and Georgia with the answer being Atlanta but you get the point.

    2. The electorate of Northern Virginia must get control of the local politicians. Please look at the campaign contributions for the Fairfax County Board of Supervisors. They are overwhelmingly from developers and builders. Of course there are no proffers for affordable housing. The politicians are bought and paid for by the developers and builders so it’s not even discussed. Blogs like this one and sites like Bacon’s Rebellion need to highlight the unholy relationship between the Fairfax County Board of Supervisors and the development industry.

  30. Toomanytaxes Avatar
    Toomanytaxes

    Groveton – We are in full agreement that NoVA, with the general exceptions of Prince William County and transportation recently because of the Wilson Bridge and Springfield Interchanges, gets the shaft when it comes to its fiscal relationship with the Commonwealth. We send dollars to Richmond and get pennies back. According to the Virginia Senate Finance Committee staff, Fairfax County residents paid at least $17 M in higher net taxes because of the Mark Warner-John Chichester tax increases. But, according to FCPS, we received less than $14 M in new state aid to public schools. Even the Fairfax County Chamber of Commerce ought to be able to figure out that this one was a big loser for all but the real estate developers that could once more avoid paying cost-based impact fees.

    In the past, I looked at average per capita real estate taxes as a percentage of average household income, local jurisdiction by local jurisdiction. There was no correlation between the percentage of income paid in real estate taxes to the relative prosperity of the county or city. Some wealthy areas paid relatively high real estate taxes, while others paid relatively low taxes. Ditto for poorer jurisdictions. If one were to overlay state aid for education funding, one finds that Fairfax and Loudoun tax dollars flow to both wealthy and poor locales, some of which make an effort to tax themselves fairly, and some of which do not.

    Whose fault is this? We all need to look in the mirror.

Leave a Reply

Read More