Arlington Scraps Streetcar Projects

Rendering of a Columbia Pike streetcar.

Rendering of a Columbia Pike streetcar.

by James A. Bacon

Arlington County’s surprise decision yesterday to cancel proposed streetcar projects for Columbia Pike and Crystal City should not be seen as a rejection of the concept of streetcars but a rejection of the funding mechanism chosen by the board that asked taxpayers to bear the fiscal risks while property owners enjoyed the benefits.

Arlingtonians, who voted John Vihstadt to the County Board earlier this month in an election that had become a referendum on the streetcar projects, questioned whether the $550 million price tag justified the purported economic development benefits. Board Chair Jay Fisette cited the decisive election results in canceling the project for which he and other board members had spent 15 years shepherding through the planning and fund-raising process.

One big problem for streetcar backers was defending the Columbia Pike project in the face of escalating cost estimates. The $358 million price tag was up $48 million from a federal cost estimate last year and up $100 million from a previous county estimate. County officials, with years of planning invested in the project, maintained that the benefits still outweighed the costs. A substantial majority of citizens were skeptical, and they said the county’s transportation needs could be met more cost-effectively with improved bus service. Continue reading

Not A “War on Suburbia” Election

(cross-posted from cnu.org)

According to Joel Kotkin, this month’s elections were really about the “progressives’ war on suburbia.” According to Kotkin, the Democrats lost because they are “aggressively anti-suburban.” Since I didn’t vote for President Obama, I leave it to his supporters to defend him.

However, I do think it is worth pointing out that cities and suburbs moved in the same direction this year. The Republicans gained several governorships this year (Arkansas, Illinois, Maryland, and Massachusetts). I couldn’t find city election statistics for Arkansas, but I was able to find city board of elections statistics for the other three states. In each, the Republican candidates for governor improved on their 2010 showing. In Massachusetts, Republican Charlie Baker gained 30 percent of the Boston city vote, up from 23 percent in 2010. This 7 point gain was equal to his 6.5 point statewide gain (from 42 to 48.5 percent) and exceeded his 4 point gain in suburban Middlesex County.

In Illinois, the Republican vote share increased from 17 to 20 percent. Kotkin asserts that this is a “laughably pathetic” vote share, but in fact the Republicans gained almost as much in Chicago as they did statewide. They gained 3 percentage points in Chicago, and almost 5 points statewide (from 46% to 50.8%). (To be fair, the Republican gained a little more in the Chicago suburbs, but that may reflect the fact that he is from suburban Chicago while 2010 nominee Bill Brady is from downstate).

In Maryland, the Republican vote share in Baltimore city increased from 16 percent to 22 percent, a 6 point shift, more than the vote shift in Prince George’s County near Washington (4 points) and almost as much as the 7-point vote shift in Montgomery County. (However, the Republican gained more votes in the Baltimore suburbs, which by Kotkin’s logic means that they must have revolted against a “progressive war on Baltimore.”)

In sum, Republican candidates gained votes in suburbia- but they gained votes in cities as well, often in roughly equal proportions.

Optimism Bias and Risk in Public Private Partnerships

tollsby James A. Bacon

Randy Salzman, a free-lance Charlottesville writer, has spent the last couple of years trying to understand how Public Private Partnerships (P3s) work in Virginia. If the private sector is supposed to be so much more efficient than government, he asks, how  come so many big P3 transportation projects in Virginia and across the nation have gone bankrupt? Why do private sector companies continue investing in similar projects despite the obvious risk? And what exposure do taxpayers when deals go bad? He doesn’t have any definitive answers, but he lays out a lot of good questions in the latest issue of Style Weekly.

Salz, an occasional contributor to Bacon’s Rebellion, gets closest to the truth when he mentions the “optimism bias” in traffic forecasts. In project after project across the country, private P3 companies and  their government partners have over-estimated traffic volumes on the roads they build. Writes Salz:

One study found that the projections tended to be 109 percent more than actual traffic — or more than double — and that nowhere in completed American P3s have actual traffic and toll income come close to projections.

Here in Virginia, flawed traffic forecasts were at the root of the Pocahontas Parkway debacle in eastern Henrico County and, if I’m not mistaken, the Dulles Greenway bankruptcy in Loudoun County (although that was not a P3 project). And there’s a very good chance that the Capital Beltway Express’s Northern Virginia HOT lanes project will experience a similar fate. Continue reading

When Nuisance Law Is A Nuisance

(cross-posted from planetizen.com)

In the recent case of Loughead v. Buckhead Investment Partners, a group of Houston, Texas, homeowners filed a common-law nuisance action to prevent a developer from building an apartment building in their neighborhood; the plaintiffs asserted (among other claims) that the apartments caused increased traffic—a claim that would be true of any new housing. Under the law of nuisance, a landowner may recover damages whenever another person uses their land in a manner that causes substantial, unreasonable harm to other landowners. A jury awarded the plaintiffs damages in December 2013, and the verdict will be appealed.

The landowners sued for nuisance because Houston has no zoning code and the city could therefore not legally exclude the apartments—but at common law, something permitted by zoning can still be an actionable nuisance. So if the Loughead action is upheld on appeal, landowners all over the country may become more willing to file nuisance actions to keep out multifamily housing (or for that matter, any other allegedly undesirable land use).

It seems to me that states should prohibit nuisance claims against new multifamily housing (either through state legislation or through judicial decisionmaking), for three reasons.

First, the public policy in favor of affordable rental housing dictates against such actions. Throughout the United States, there is a rental housing shortage. Between 2000 and 2013, median household income has increased by 25.4 percent, while rent has increased by 52.8 percent. The explosion in rental costs has not been limited to gentrifying, traditionally high-cost cities such as San Francisco and New York. For example, in Hattiesburg, Mississippi, rents increased from 20 percent of household income in 1979 to 35.2 percent in 2013. The explosion in rents is in large part the result of increased demand for rental property; tighter credit standards and stagnant wages have kept would-be homeowners from buying houses and forced them to rent instead. The supply of multifamily housing has increased, but not fast enough to keep up with increased demand: the national rental vacancy rate (8.3 percent) is at its lowest point since 2000. Continue reading

No Wegmans for Tysons… Too Bad for Wegmans

wegmans_bakeryCan Tysons have its cake and eat it, too? Perhaps not, at least if the cake is baked in a Wegmans Food Market bakery. Discussions to bring the Rochester, N.Y.-based grocery chain to a transit-oriented development around the McLean Metro station have ended in frustration, reports the Washington Post.

CityLine Partners, developer of the Scotts Run Station South project in Washington’s Northern Virginia suburbs, won rezoning approval last year to transform a typical suburban office park into 6.7 million square feet of mixed-use commercial and housing towers with ground-floor retail. The development plans includes contributing to a Tysons-wide grid street network, creating more walkable streets and reducing the parking footprint.

It would be a real coup to bring a Wegmans to the development. The upscale store appeals to exactly the kind of higher-income demographic that CityLine wants to attract to its project. But Wegmans’ business model meshes best with suburban development.  The company normally builds stores of more than 100,000 square feet surrounded by large surface parking lots. In Tysons, Wegmans was considering a new “urban” format of 80,000 square feet, similar to one it opened in Boston this spring, the Post reports. The idea was to place the store on the ground floor of a building with apartments upstairs. Continue reading

The Market Speaks, and It Likes Reston Town Center

reston_town_center
Reston Town Center got a half-century head start in creating the kind of community where enterprises want to do business in the 21st-century knowledge economy. The original developers were planning for and building walkable, mixed-use development before walkable, mixed-use development was cool. And today property owners are reaping the benefits.

According to Cushman/Wakefield, offices in Reston Town Center are near full occupancy and command among the highest rents in Northern Virginia. The business district’s big competitive advantage? A strong amenity base. Summarizes Virginia Business:

The report notes that in addition to 2.8 million square feet of office space, Reston Town Center is home to 50 retail shops, 30 restaurants and three residential high-rise projects. Even with a suburban location 20 miles outside of Washington, D.C., and a lack of Metro accessibility until at least 2018, the center’s density, mixed-uses and walkability give the center an urban feel that attracts tenants and residents.

Continue reading

Which Calls for More Regulation, Sprawl or Smart Growth?

How do you get more development like this -- with more regulation or less?

by James A. Bacon

One of the more potent criticisms of the Smart Growth movement is that smart growthers implement policies that restrict development, create housing shortages and make housing unaffordable for the poor and working class. The critics present ample evidence that metro regions with the tightest restrictions on development and re-development have higher housing prices overall than regions with fewer restrictions.

But there is more than one way to achieve Smart Growth, at least in theory. One way is is libertarian in inspiration: rolling back the suburban-inspired zoning codes that segregate land uses, cap density restrictions and impose minimum parking requirements on property owners. Undoing the massive government intrusion in local land use would go a long way to reversing the so-called “suburban sprawl” that is the antithesis of Smart Growth without imposing restrictions on new development. A different approach to Smart Growth is more activist: encouraging mixed use development and re-development, seeking more density and curtailing parking in order to push people out of cars.

Suburban zoning codes and regulations are almost universal across America in places developed since World War II, and even in some traditional urban cities. To what extent have activist city governments offset suburban mandates with Smart Growth and environmental mandates? Michael Lewyn and Kristoffer Jackson set to find out. You can read their conclusions in “How Often Do Cities Mandate Smart Growth or Green Building?” in a paper published by the Mercatus Center. Continue reading