Selling San Juan: Part 5

An essay on New West gentrification and the feasibility of preserving community self-determination in San Juan County after the designation of Bears Ears National Monument.

Part 5: My Town, Inc.

A city or town is, among other things, a corporation defined by its geographic boundary.  The residents of the town are its shareholders and the prosperity of the municipal corporation is essentially a function of the productivity of the real estate within its city limits.  Given the differential costs and benefits associated with distinct development patterns, it follows that local land use policy is one of the key variables in determining not just the physical identity and social conditions of a place but also its long term fiscal resilience.  As unpoetic as these observations may be, it is imperative to confront them explicitly.

America’s Suburban Experiment

In many respects, the proliferation of the New West ranchette is simply an extreme expression of the suburban development pattern that dominates the landscape of post-1945 America.  A deeper understanding of the modern suburban development pattern is therefore a good starting point for better understanding the tradeoffs associated with the typical New West development pattern.

Comparing the underlying logic of the suburban experiment with what prevailed before about 1945 can be fairly reduced to a single distinction: for all of human history before 1945, development was organized around the human being; since 1945, the organizing unit is the automobile.  This single shift, aided and abetted by essentially the entire American financial and political apparatus, has given us a built environment notable for, among other things, its extreme monofunctionality and rapid consumption of land.  Fine lines are now brightly drawn between industrial, commercial and residential land uses, and between the rich, middle-class and poor.  Also, much more space between all types of productive land use is required for (and enabled by) the use and storage of our cars.  This shift has made it broadly infeasible or even illegal to develop land according to a resilient, flexible neighborhood form and has effectively killed a wide range of time-tested affordable housing types.  That this shift in the logic of development has also planted a time bomb within the balance sheet of the typical municipal corporation is only now becoming widely apparent.

When a new subdivision is built, substantially all of the improvements — utilities, pavement, curb-and-gutter, sidewalk, etc. — are constructed at the expense of the private developer (which are, in turn, bundled into the price of a finished building lot or home) and then dedicated to the public.  This is the essence of greenfield development and, on its face, it seems like a great deal for the city and its residents: a free bump to total public assets plus an expanded tax base plus usually the payment of impact fees or other exactions on development.  The only hitch is that this process also effectively puts a long term liability on the city’s balance sheet in the form of the maintenance and eventual replacement of the constructed improvements.  The (unasked) municipal finance question becomes whether the new revenue stream associated with the new land use at least matches the new liability. And the answer, when it comes to the suburban development pattern, is that it doesn’t and it isn’t even close.  The phenomenon is fully exposed in an extremely detailed study of the city of Lafayette, Louisiana, by a team of experts at this analysis.

Joe, Josh and I interviewed all the city’s department heads and key staff. We gathered as much data as we could (they had a lot). We analyzed and then mapped out all of the city’s revenue streams by parcel. We then did the same for all of the city’s expenses. This was the most comprehensive geographic analysis of a city’s finances that I’ve ever seen completed. When we finished, we had a three dimensional map showing what parts of the city generated more revenue than expense (in business terms, this would be called profit) and what parts of the city generated more expense than revenue (again, in business terms, this is considered a loss).

Here’s that map. In accounting terms, green equals profit and red equals loss. The higher the block goes, the larger the amount of profit/loss. If you have a sense of the basic layout of North American cities post World War II, you can figure out pretty easily what is going on here.

Text & Image: Urban3/Strong Towns

A few easily-understood metrics calculated by the consultants further reveal the root of the problem: between 1949 and 2015, while Lafayette’s population grew by 350%, the city’s feet of culinary water pipe per person increased by 1,000% and its fire hydrants per 1,000 people by 2,140%.  In effect, as Lafayette shifted from relatively compact traditional development to the rambling suburban form, all the increase in top-line wealth was outstripped several times over by the expenses of a radically expanded system of public works.  The consultants calculated that the imbalance had become so extreme that to catch up with the city’s maintenance obligations would require a property tax increase of 533%, an impossible figure.  In sum, an extended period of robust growth had led not to the enrichment of the city but to its impoverishment if not insolvency, a circumstance which is not unusual in the least in America.

Note that this phenomenon is an axiomatic consequence of the post-war development pattern.  It can’t be blamed on low property values; in fact, the math almost always reveals that the poor neighborhoods of a city subsidize the affluent.  It is also not an issue of savvy versus incompetent city administration, nor simply a function of commercial property subsidizing residential.  In fact, in a head-to-head comparison of commercial land uses, the car-centric form fares even worse.

Image: Urban3/Congress for the New Urbanism

So, not only does a big box store like Walmart impoverish a community directly by crushing the locally-owned mom-and-pop retailers of Main Street and siphoning profits out of the local economy, but indirectly by returning a pittance in taxes on an apples-to-apples (i.e. per-acre) basis, all while reinforcing car dependence and consuming a massive chunk of a city’s stock of land. It’s fair to say this is a better deal for Walmart than for the town.

The next parts of the essay will delve with more detail into a discussion of some of the tactical topics raised by the broad shift to a suburban development pattern, with particular focus on its expression in the gentrifying rural West.  This will bring me (finally) to some of the “things to watch” in San Juan County post-Bears Ears designation.  But this brief introduction to the financial implications of the choice between traditional and suburban development patterns is a necessary detour for understanding some of the stakes associated with being more precise when we talk about “development.”


Select sources & additional reading:
Much of this part of the essay is a selective summary of a particular strand of critical thinking about urbanism that is gaining increasing traction across North America.  Two allied individuals and the organizations they lead deserve particular credit for synthesizing and communicating this approach.  A more capacious introduction to their work can be found at these links:
Marohn, C. Curbside Chat. Strong Towns.
Minicozzi, J. The City Shaped. Urban3.