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If you are interested in downtown development, pay attention: There is growing support for adopting a system of "density bonuses" downtown. The idea has been recommended by the Density Bonus Task Force of the Austin Design Commission, which was created by City Council for the purpose of . . . recommending a system of density bonuses.
Continue reading "Density bonuses: Raising density's price" »
Several University of Texas fraternities and sororities will ask the Planning Commission tonight to carve their properties out of the University Neighborhood Overlay. Staff has endorsed the requests. I'm surprised, because this is a bad idea.
The UNO, approved in 2004, dramatically increased allowable heights and densities in a chunk of West Campus. It has resulted in the wholesale reconstruction underway there now. Over the next few years, we will see thousands of new units of student housing in West Campus. That is a good thing.
The relaxation of height and density restrictions predictably has hiked up the value of properties within the UNO. This has resulted in a steeper tax bill for the fraternities and sororities within the zone. The property tax bill for Sigma Chi's house, for example, tripled to $60.000 between 2004 and 2007. The appraised value increased from $857,000 in 2002 to $2,284,000.
Tim Aynesworth, coordinator for a student housing preservation group, said nonprofit student housing organizations do not benefit from the overlay's zoning guidelines. In response to the zoning changes, Aynesworth said they want their properties to be excluded from the overlay and returned to the classification as a multi-family base zoning district.
"We need to find a way to return to our original zoning district," he said. "By doing so, we will actually reduce the development potential of the property and hope it will lower its valuation."
The fact is, though, that fraternities and sororities are competing against other students for very scarce land. Right now, they are consuming a lot of land for a relatively small number of students. For example, the Sigma Chi property has just 13,591 square feet of living space on a 39,000-square foot lot (0.9 acre), a floor-to-area ratio of just .34. The lot has a 75-foot height-limit under the UNO, and could hold well over 100 student apartments (maybe a lot more).
Who deserves it more? I don't know. I don't even know how to make this kind of moral judgment. That's why I prefer to let prices sort it out. The cost of holding a piece of property consists of the opportunity cost and the tax burden. Fraternities and sororities are functionally shielded from the opportunity cost by our non-profit tax laws. The only cost they face is the tax burden. If we cut their property tax burden, there will be no way to tell how much they really value the properties. Inevitably, we will see fraternities and sororities hold onto properties long after they would have been converted to mid- or high-rise student housing. I don't see any justification for such a policy -- unless someone wants to argue that fraternities and sororities produce significant benefits to society at large, not just to their memberships.
Can anyone make a case that we ought to ban plastic bags? I mean a serious case -- one that totes up their benefits as well as their costs?
I know that this isn't it:
Many city officials and environmental groups want to eliminate plastic bags altogether since they take up valuable landfill space, are harmful to creeks and litter public areas. City leaders estimate 1,000 tons of plastic bags are placed into our landfills just from Austin.
. . .
One local environmental group, Bag the Bags, estimates Austinites use more than 100 million plastic bags every single year.
They take up valuable landfill space? I'm not so sure landfill space is all that valuable. But let's suppose that it is. Why would you start with plastic bags? 1,000 tons sounds like a lot (assuming it's not an exaggeration), but Austin collected 135,000 tons of garbage in FY 2007. Plastic bags comprised just 0.74% of our garbage by weight, and probably less by bulk, since you can compact them down to nothing. And why would paper bags -- the obvious substitute -- take up any less space? We'd probably need more space, since paper bags tend to be bigger than necessary, meaning extra wasted material.
Harmful to creeks? Yes, they are. Just off the top of my head, here are some other things that we don't want in creeks: paint, batteries, ammonia, deodorant, plastic bottles, plastic straws, plastic forks, soda cans, tin foil, tin hats, granola bar wrappers, the little plastic cups that Jello pudding comes in . . . . and a gazillion other things. All end up in creeks sometimes. We wouldn't even think about banning them just for that, though. We'd only think about a ban if too many of them were ending up in creeks, and the problem couldn't be controlled more cheaply (say, through periodic community clean ups), and they weren't too useful. In other words, we'd insist on a cost-benefit analysis. Where's the one for plastic bags? Maybe bags end up in creeks more often then other stuff (what about bottles and cans?), but that is because they are ubiquitous. They are ubiquitous because they are so useful.
Litter public areas? So does all the other litter that litterers litter with. See previous point. (Some people actually use plastic bags to carry away their litter, something you can't say about the more respectable trash.)
I've heard the petroleum argument, too. It supposedly takes 430,000 gallons of oil to make 100 million plastic bags. Let's see, roughly 700,000 Austinites using roughly 100 million pb's per year, indirectly consuming 430,000 gallons of oil per year . . . that works out to an average of about 0.6 gallons per year per Austinite. For my car, that's the equivalent of 15 miles per year (city driving). I hereby pledge to drive 1.25 fewer miles per month if I can keep the bags. (Maybe I'll stay home from work tomorrow as a sign of good faith.)
Now I could see how paper bags might be better for fighting global warming. Using lots of paper bags would increase the demand for trees, which would cause more trees to be planted, which would absorb more carbon dioxide from the atmosphere. But environmental groups say paper bags take a lot more energy to make (which actually seems plausible).
Whatever the costs, we also have to consider the utility of pb's. You can carry things with them. Even wet things. They're stronger than paper bags, you can get them in the right size, they are more elastic than paper and resist punctures better. You can wad them up in a plastic-bag holder until you need them again, which makes it easy to use them multiple times. And you can put stinky diapers in them, perhaps their best and highest use. (No, we don't use cloth diapers. I can assure you that the disutility to me of using cloth diapers wildly exceeds the externalities I cause by using disposable diapers.) One creative soul even makes dresses out of them (but wants to ban them).
If there is a good case for banning the bag -- one that balances real costs against real benefits -- I'd be interested in hearing it.
I love Jane Jacobs, especially The Life and Death of Great American Cities. Jacobs understood that the vitality of a city emerges spontaneously and organically, and can not be created by fiat through urban planning. Of course, she was also the first "urban naturalist"; she described almost scientifically what gives cities and neighborhoods vitality and what saps it. Ironically, this has made her the patron saint of modern planners, who seem to view Life and Death as a recipe for good planning, rather than a rejection of planning. (You can't sit through a City Council meeting without hearing about the need for "eyes on the street.") She has also been canonized by neighborhood activists who fight change of any type.
Andrew Blum has written a great piece on urbanism that captures the increasing tension between these views in the modern, global enviornment:
Judging from comments in the Chronicle's forums and elsewhere, a lot of people wanted to give CWS Capital Partners a variance from the Waterfront Overlay's 200-foot setback. The argument in favor of the variance was pretty straightforward:
The purpose of the Waterfront Overlay is to provide a buffer between development and Town Lake. There is no buffer on the CWS tracts now; apartment buildings sit within 20 feet of the lake's banks. A variance will induce the developer to demolish the existing buildings, increase the buffer from 20 feet to 150 feet, and provide a trail surrounded by green space. This will further the Overlay's goal. Denying the variance will not -- the developer will probably just rebuild the existing buildings, depriving the public of this buffer forever. It makes no sense to sacrifice the buffer in order to preserve the buffer.
Obviously, a lot of people disagreed, whether because they were worried about precedent, the prospect of tall buildings along Town Lake, or something else. But any fair account of the dispute should have acknowledged the supporters' argument.
The Chronicle was a cheerleader for Save Town Lake from the beginning. I therefore am not surprised that it disagreed with those who supported the variance. But I am still stunned that the Chronicle refused to acknowledge the argument in favor of the variance. Even worse, it did not mention, except obliquely, that there are apartment buildings squatting in the primary setback today.
See for yourself: Katherine Gregor's very first article in October 2006 ignored the apartment buildings now sitting within the setback. So did this November 24, 2006 piece. So did the articles and updates on January 19, 2007, January 30, 2007, February 23, 2007, April 27, 2007, June 1, 2007, June 8, 2007, August 28, 2007, August 31, 2007, September 14, 2007, September 21, 2007, and October 10, 2007.
I found only two references at all to the existing buildings abutting the banks. Back in November 2006, at the end of a long article on CWS's parkland dedication obligations, Katherine Gregor tersely noted CWS's threat to "leave in place some of the existing 1970s apartments, very close to the water," but she then assured us that "this seems unlikely given the parkland dedication requirement and other site factors."
The Chronicle went without mentioning the existing buildings again -- despite a dozen opportunities to do so -- until October 2, 2007, when it published a biting piece on CWS's astroturf "Extend Our Trail" campaign; the "campaign" consisted of an e-mail touting the CWS as "responsible development." The e-mail cited the removal of the apartments close to the water as a reason for approving the setback, and the Chronicle reprinted the e-mail at the end of the article. But the Chronicle cannot claim this as a disclosure. It reprinted the e-mail only after accusing CWS of lying and waging a disinformation campaign. (The piece began, "When you can't get what you want, you should like, distort, and take advantage of the innocent public for your own gain, right?") It was unclear from the article whether the Chronicle believed that any of CWS's factual claims was accurate.
That was all I could find. Over a dozen articles and updates, but only two fleeting references to the existing buildings, both ambiguous at best, misleading at worst. The Chronicle effectively refused to acknowledge that the buffer zone was already developed. Needless to say, it also refused to acknowledge that some Austinites supported the variance as the only way to clear the buffer zone of that development.
In the comment thread to this post, Michael King, the Chronicle's news director, defends the Chronicle's coverage:
In this thread, "slanted" or "yellow" journalism appears to mean any writing that comes to any conclusion but one that agrees with the poster's. The Chronicle has always been an explicitly advocacy paper, although individual writers can and will take opposing positions. If you prefer ping-ping, he-said she-said tape transcripts, I suggest you stick to the AP reports in the daily.
(Read his comments yourself; there is much more.)
I don't have a problem with the Chronicle being an advocate; honest advocacy is better than fake objectivity. But failing to acknowledge your opponent's argument -- much less the real issue in dispute -- is not good advocacy. Even public relations firms will address the other side's position. Good advocates (and, I thought, good journalists) care about their credibility. Dodging the issue is the quickest way to lose it. If you don't believe me, try telling a judge that you ignored the other side's position because you don't play ping-ping.
Some photos below the jump.
It's still not too much to look at. But it's progress.
Here is the builders' lot map if you want to orient yourself.
I guess this is an optical illusion. I can get her to change directions if I squint real hard. (Via Marginal Revolution).
This one from Matthew Yglesias is good, if a bit naive.
This one from Virginia Postrel has a good summary of the research documenting the steep price of California-style zoning:
Some of the higher price of L.A. real estate does reflect the intrinsic pleasure of living there, as I’m reminded every time I walk out my door into the perfect weather. Some of the price reflects the productivity advantages of being near others doing similar work (try selling a screenplay from Arlington, Texas). All of these benefits—and the negatives of traffic and smog—are reflected in the price of land.
But what exactly is that price? Consider two ways of computing the price of a quarter acre of land. You can compare the value of a house on a quarter acre with that of a similar house on a half acre. Or you can take the price of a house on a quarter acre and subtract the cost of the house itself—the price of construction. Either way, you get the value of an empty quarter acre. The two numbers should be roughly the same. But they aren’t. The second one is always bigger, because it includes not just the property but the right to build. Expanding your quarter-acre lot to a half acre doesn’t give you per- mission to add a second house.
In a 2003 article, Glaeser and Gyourko calculated the two different land values for 26 cities (using data from 1999). They found wide disparities. In Los Angeles, an extra quarter acre cost about $28,000—the pure price of land. But the cost of empty land isn’t the whole story, or even most of it. A quarter- acre lot minus the cost of the house came out to about $331,000—nearly 12 times as much as the extra quarter acre. The difference between the first and second prices, around $303,000, was what L.A. home buyers paid for local land-use controls in bureaucratic delays, density restrictions, fees, political contributions. That’s the cost of the right to build.
And that right costs much less in Dallas. There, adding an extra quarter acre ran about $2,300—raw land really is much cheaper—and a quarter acre minus the cost of construction was about $59,000. The right to build was nearly a quarter million dollars less than in L.A. Hence the huge difference in housing prices. Land is indeed more expensive in superstar cities. But getting permission to build is way, way more expensive. These cities, says Gyourko, “just control the heck out of land use.”
(Read it for this. I don't agree with her "red-state/blue-state" theory of zoning.)
Update: Postrel has posted a follow up to her article with some neat charts.
Austin's new water conservation laws are a good illustration of the wastefulness of command-and-control regulations:
The new watering laws -- which limit watering of commercial and multifamily landscapes to twice a week year-round beginning on Oct. 1 -- are part of the city's broad new water-conservation policy approved in August. In addition to being limited to watering twice a week -- Tuesdays and Fridays -- owners will only be able to water before 10 a.m. and after 7 p.m. on those days.
City leaders say the new policy will save 33 million gallons of water a day in the coming years and reduce greenhouse gas emissions from carbon dioxide -- used to generate the electric power for water treatment -- by about 40 million pounds. Austin is the first city in the country without a water supply problem to adopt such a far-reaching conservation policy, says City Council Member Lee Leffingwell, who led the effort.
The new ordinance also limits irrigation at "residential facilities" (colloquially, "homes") to designated watering days between May 1 and September 30. The restrictions apply regardless of how full the lakes are.
I don't quarrel with the City's desire to conserve water. I don't think global warming is the real rationale, though. The City wants to knock a percentage point or two off the annual growth in demand, which could delay costly capital investments in new water treatment plants. That's reasonable, depending on the cost of conserving water versus the cost of building new treatment plants.
But why this ridiculous command-and-control system? Why this self-destructive antipathy to using prices to ration scarce resources? I was gearing up for a sermon on the benefits of prices, but M1EK has already covered this fairly well.
Command-and-control systems may get you the same savings, but they cause a lot more pain and cost a lot more to enforce, as the Statesman article shows:
People who repeatedly violate the rules could receive Class C misdemeanor citations and fines of up to $500, but inspectors will work with property owners first to seek compliance, said Dan Strub, the city's acting division manager of water conservation. The city is hiring three full-time water conservation inspectors, at a cost of $180,000, to join two full-time inspectors.
Deborah Cole, who has owned the Austin business Greater Texas Landscapes for 26 years, said the new watering rules are simple to understand but impractical to follow. "The premise they are based on is that two days a week will be adequate for landscapes that have good soil depths and the right plants. But many commercial sites and residential sites in Austin do not naturally have much soil," she said.
There are solutions, such as adding soil or mulch or upgrading sprinkler systems, but businesses need time to phase those expenses into their budgets, said Kyle Gillman, vice president of the building owners group.
City Council Member Lee Leffingwell said that a city committee spent more than a year writing the rules and that property groups had ample time to offer feedback and then figure out how to comply with the rules, which the City Council passed in May.
Property owners can seek a variance from the watering schedule if they have newly installed landscapes (which require more water) or have very large properties, Strub said.
Carl Tepper of Kucera Management, which manages 20 office buildings in North and Northwest Austin, said the city should allow variances for evapotranspiration controllers, devices that can save water by prompting sprinklers to run only when a lawn needs water, based on soil and weather conditions.
Beginning next year, the city will require the controllers on newly installed sprinkler systems, Strub said. But they will have to be programmed to run only twice a week.
"If we gave variances to everyone (with "ETs") just because of the potential to use less water, that would make the ordinance much less enforceable. There would be exceptions all over town," Strub said.
Wow. What a nice illustration of the lunacy of top-down regulations. Let's count the costs. First, there are the unnecessary direct enforcement costs. We will spend $300,000 years on inspectors to snoop for profligate water use when we could get the same savings for free just by fiddling with the price.
Second, there are the secondary enforcement costs -- the unnecessary extra water use caused because our enforcement scheme must be simple enough to enforce. Thus, we have good Mr. Strub arguing that we can't encourage businesses to use efficient evapotranspiration controllers "just because of the potential to use less water." Right. Let's require businesses to waste water so we can easily monitor whether they are wasting water.
Third, there are the losses to businesses caused by the one-size-fits-all approach. The twice-a-week schedule may not be enough for some; the cost to them will be dead landscapes. But even when the twice-a-week schedule is adequate, some businesses might be able to cut their water use in a different, less painful way. The extra costs they must incur to do it the City's way is a dead-weight loss.
Fourth, the top-down approach misses a lot of potential savings. The City's regulations focus solely on lawn watering. That may account for most water use, but I guarantee that there are plenty of easy savings to be found in restaurants, car washes and office buildings. Raising the price would encourage all commercial water users to watch their water use. We would save more water at a lower average cost.
Using prices would have two other collateral benefits to the City. First, it would permit us to calculate the cost of water conservation. That's a good thing when we'd like to know whether it would be cheaper to add new water treatment plants. Second, raising the price would bring in extra revenue that could be spent on improving water infrastructure -- old, leaking pipes, for example.
This turned into a sermon after all. But I really don't get this fetish for top-down regulation. Just raise the damned price.
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