How many acres of warehouses does it take…

…to equal the local tax base and job creation benefit of 1 manufacturing facility? 

Here is the math.

 

Mack Trucks - Lots of employees per acre of land at excellent wages. Manageable impact (well worth it for the excellent paying jobs) and good local tax generation.

Mack Trucks – Lots of employees per acre of land at excellent wages. Manageable impact (well worth it for the excellent paying jobs) and good local tax generation.


MANUFACTURING

Mack Trucks consists of 922,950 SF of floor area on 147 acres. The facility generates exactly 9,000 dollars a year in municipal property taxes. The employee counts fluctuate yearly, but they average around 1,850 employees annually. This year Mack is on track to contribute around *84,000 dollars in local services tax receipts. On average 100 of those 1,850 employees live in the township so we collect another 7,000 dollars in **earned income tax.

Property Tax – 9,000
LST – 84,000
EIT – 7,000
$100,000 yearly Lower Mac tax benefit
1850 employees over 147 acres – 13 jobs per acre.

All together Mack Trucks injects 100,000 dollars annually into Lower Macungie Twp. directly through tax receipts. 

The question here is how many warehouses on how many acres of consumed land (in our case prime farmland) does it take to match that amount of tax base generation and jobs?

Low revenue per acre paired with costly liabilities. Not a winner for the local government.

Low revenue per acre and few employees paired with costly liabilities. Not a winner for the local government.

 

WAREHOUSES
The answer is more than 5 buildings totaling 2.5M + SF of floorspace eating up nearly 200 acres of former farmland. Total property tax receipts on 5 properties analyzed are $45,000. On average all 5 buildings together employ about 600 people. Problem is many are part time or otherwise do not qualify for the 12,000 a year threshold in earnings for the township to collect the LST. Employee turnover is also very high. So the total LST generation for these 5 buildings is roughly $26,000. Of those 600 employees only a small percentage, 34 live in the township. We collect about $3,000 dollars in EIT from them total.

Property Tax – 45,000
LST – 26,000
EIT – 3,000
$74,000 yearly township tax benefit
600 employees over 200 acres = 3 jobs per acre of land.

All together 5 warehouses analyzed which eat up nearly 200 acres of land and generate a grand total of $74,000 dollars. 35% less than Mack on 35% more land. 

Conclusion
5 warehouse facilities eat up about 35% more land (in Lower Mac’s case irreplaceable prime farmland) but in total generate about 35% less revenue.

Jobs? That’s 13 jobs per acre for Mack Trucks vs. 3 jobs per acre for the warehouses. Mack generates over 300% more jobs per acre than the warehouses.

This is of course only one half of the equation. The municipal liabilities which aren’t as easily quantified but verifiable are exponentially more impactful with the warehouses.

Now, Mack Trucks is a powerhouse. That’s readily acknowledged. But what about other manufacturing facilities in the township? The numbers remain staggering. Similar numbers for special effects producer Smooth on. 350% more jobs per acre than warehouses and 170% more tax revenue generation per acre. And smooth has so little impact on it’s neighbors that it’s located within a neighborhood. (I live next to the facility and it’s an excellent neighbor) It’s outstanding tax generation numbers are also a credit to the companies very high wages. We get the added benefit of a company mentality and philosophy that encourages employees to live near the facility. Oftentimes within walking distance.

How about Victaulic? Situated on just 10 acres it employs over 150 employees locally. Again, over 350% more jobs per acre than the warehouses. And this little powerhouse generates over 125% more revenue per acre.

 
*LST Persons working in the township are assessed $52 for local services. Those earning less than 12,000 per year are exempt. 

** EIT Collected from employees who reside in the township. 1/2 of 1% of earnings. 

*** Property Tax – Lower Mac has a .50 millage property tax. 

 

BOC meeting review. Big conversations about long term liabilities.

I didn’t do a preview of the last BOC meeting so I will do an overview focusing on one of the biggest conversations we had. We had two related topics and related discussions that in my opinion were of great “big picture” importance. 

They both deal with township ownership of long term public liabilities related to new development.

Backgrounder: In the past the township didn’t seem to be interested in looking at new development in terms of new revenue (beyond the windfall) vs. long term liabilities. Like many communities stuck in feedback loop mode of the growth ponzi scheme we only saw the short term but shortsighted windfall and rewards of sprawl.

Slowly but surely we’re starting to have the right conversations. We’ve always had a basic understanding that too much residential development creates a revenue shortfall. We’ve known that taking on new roads and storm water infrastructure costs us. So over the years we even demanded escrows from developers to help defray the cost. Again, not a permanent solution. Just a bigger band-aid to delay the inevitable. We’ve sought more commercial development to balance our residential. Unfortunately instead of high value corridor development and neighborhood commercial we’ve induced (at high public cost) low value warehouses. Another low revenue high liability land use.

So today we really still haven’t addressed underlying issues. But with at least one conversation last week took a definitive stand. In my opinion, at it’s core smart growth is ensuring that development pays the true costs of doing business in the township so those costs aren’t passed on to or subsidized by taxpayers.

This is: Smart Growth for Conservatives.

Two items related to development and public vs. private infrastructure.
The first conversation last meeting related to residential development. With this issue a developer was able to talk 3 commissioners into paying for perpetual long term stormwater maintenance exclusively associated with a new development. Developer used some convoluted argument that the water was coming from a public roadway. Nonetheless, any increase in runoff volume is a direct result of the new development therefore long term cost should not be shouldered by the taxpayers. So I chalk that one up as a loss as far as common sense is concerned. But grand scheme its small potatoes.

While that decision was disappointing on the other hand a big victory for taxpayers was in relation to over 55 private (in some cases gated) developments and new private cluster developments. One of the major reasons Lower Mac has been able to keep taxes so low and for so long is that in addition to temporary windfalls associated growth Lower Macungie has been lucky to secure a very large amount of private developments.

When a new development maintains it’s interior roads and storm-water facilities as private the inherent budget shortfalls of residential development are somewhat negated. Last week the township solidified an informal policy that it desires private roads and stormwater in new residential development. I believe we should go further and incentivize it.

If you recall one of the biggest victories for taxpayers to come out of the Jaindl settlement a result of resident attempts to overturn the rezoning was that the developer took on a major access road serving exclusively the new warehouse zone as a private facility. Turns out taxpayers are still paying for/subsidizing a huge chunk of the costs. But at least locally we’re not on the hook for long term maintenance. (Although we are for many of the stormwater facilities)

Bottom line is this. In our quest for more balanced growth we need to continue to get more strategic. Chasing ratables for the sake of chasing ratables with no reconcilation of the long term costs will leave us with deficiencies when the gravy train leaves town. The township needs to balance the books. And we have to start now.

Lower Mac to consider borrowing for open space preservation.

I support preservation of farmland & open space prioritized by parcels with high development pressure. While debt isn’t my preferred means to accomplish this I support whatever consensus the board arrives at since I feel strongly about the long term benefits. I also understand we have a voter mandate for preservation.

*Note: I have over the past year proposed alternate funding strategies including:
1. Ear-marking developer transfer taxes for preservation
2. Creating a transferable development rights program (TDR). TDR is a free market mechanism for preservation. It involves no township money.
Unfortunately, neither got traction from other board members. 

In March Commissioners Conrad & Lancsek proposed borrowing to fund preservation. While I am pleased it appears the entire board is willing to settle on a mechanism I am only cautiously optimistic at this point. Read about the proposal here.

First, let’s talk mandates. I came into office with 2. Important to remember, since both relate to preservation.

1. First keep taxes sustainably low. Meaning setting us up for long term resiliency as opposed to gimmicks. I think I’ve delivered with the homestead exclusion that rollled back 25% of the prior boards tax increase for homeowners. More importantly relating to resiliency it sets us up to capture more revenue from commercial and industrial users (strip malls and warehouses). These uses generate more liabilities than revenue. Addressing this disparity sets us up for a more sustainable long term balance sheet. High liability land-uses should carry the burden. Not residents.

2. Second I came into office with clear mandate from voters to preserve farmland and developable open space. This also relates to #1. How to keep taxes low in Lower Macungie.

So why only the cautious optimism about the bond?

I’m nervous that some might see a 10M bond as a “blank check” for whatever pet project is the flavor of the moment. With the “blank check” mentality we can get lazy. That scares me.  Remember, the reason the prior BOC raised taxes in 2012 was to fund capital projects. Fact is since then, the largest single project moving forward is the 4.9 million dollar quarry park renovation including over 1.5M earmarked for turf fields. Hardly a priority and certainly not warranting a tax increase.

I’m nervous we’ve diluted a conversation about funding open space (something with clear long term financial benefits) with “other capital projects”. (Things that might not)

I’m also leery of inducing more “dumb growth” with STROAD infrastructure. While it’s important we solve existing traffic problems we have to be careful not to induce further congestion. (see graph below)

So, lets proceed but with caution. Any questions about the potential bond please feel free to email me at ronbeitler@gmail.com

What is induced demand.

The red line represents vehicle flow along a given road. Traffic steadily rises until someone decides the road needs to be widened. Then the original trend line (dotted red) gets replaced with an even greater travel forecast (dotted orange), as we'd expect by creating more road capacity. But the actual new level of travel developed by this widening (solid red) is even greater than the forecast predicted.

The red line represents vehicle flow along a given road. Traffic steadily rises until someone decides the road needs to be widened. Then the original trend line (dotted red) gets replaced with an even greater travel forecast (dotted orange), as we’d expect by creating more road capacity. But the actual new level of travel developed by this widening (solid red) is even greater than the forecast predicted.

We can do better in Lower Macungie.

Every once and awhile I like to do a post primarily of photos demonstrating visually what I think represents more community serving and friendly development for Lower Mac. The type of development that we need more of. Alternatives to sprawling strip commercial. Specifically in the Villages of East Texas & Wescosville and along the Hamilton Corridor. I’m often critical of development projects and our current zoning ordinances that allow them. It’s only fair that I present what I think the alternative looks like.

We are making progress. We really are.
(For ex. our Planning Commission is now serious about walkability!)
But we can always do better. We have to.
#wecandobetter

Example 1: Alternatives to the strip
Here is an article about a neat neighborhood commercial project that might be built in Hellertown. 
Right out the gates this proposal is oriented in a more friendly fashion with parking to the side and rear. More attractive and in line with the desired character of Hellertown (Main St. in tone vs. STROAD in tone). This encourages walkability by framing the street, calming traffic by visually narrowing the roadway and since it’s an infill project it takes advantage of existing infrastructure representing great value. Today, our zoning code doesn’t allow this type of form.

The way this building is oriented to the street encourages a more cozy and attractive character.

The way this building is oriented to the street encourages a more cozy and attractive character. This would be a great alternative to buildng more strip malls on Hamilton Blvd.

Example 2: Even the big dogs are slowly getting it.
Here is a photo of a new prototype store built by Wal-Mart. Even the vaunted and much maligned big box behemoth is slowly but surely creating more community friendly store designs.
They are doing this because they know that’s what the market will dictate moving forward. Most of the big box players now have better prototypes. As a community  you just have to insist on quality! No excuses in a community so highly sought by retailers like East Penn is. Due to our highly coveted demographics. 

An attractive alternative to the typical Wal-Mart superstore "box".

An attractive alternative to the typical Wal-Mart superstore “box”.

Example 3: You can build beautiful new construction!

When artists draw idyllic classic representations of American Communities how come they never draw strip malls or STROAD commercial corridors?

When artists draw idyllic classic representations of American Communities how come they never draw strip malls or STROAD commercial corridors?                   Key elements here include: PEOPLE centric design, multi modal, attractive and warm. This represents simplicity and timelessness. Something in this tone will remain viable in 50 years.

When you build neighborhood commercial the focus isn’t on buffering because the building fits into the fabric of the community. Strip malls must be buffered because they are inherently abrasive environments.

This corner development frames the public domain. Walkable. Pleasant. Comfortable. Plenty of parking. (It's just in the rear so we don't have to look at it!)

This corner development frames the public domain. Walkable. Pleasant. Comfortable. Plenty of parking. (It’s just in the rear so we don’t have to look at it!) You see residential homes in the background. And that’s ok. No need for buffers when development fits with the fabric of a neighborhood!

This example is just off a driveway to a shopping center. This is a bank. Just like we have many here. Except it’s clearly very different. (New construction Lancaster PA)

Screen-Shot-2013-08-09-at-12.56.20-PM

 

Just across the street from that bank in the same shopping center is this cafe with apartments above.

Square

 

Example 4: Follow the private investments
Really, we don’t even have to look that far at all.
As a local government unfortunately the focus recently has been on subsidizing a low value mega strip mall, (even though it’s a “nice” strip mall it’s still a strip mall)  in other parts of the Village of Wescosville today we have private investments in high value neighborhood friendly commercial design in the form of adaptive reuse projects.

BEFORE

AFTER!

Adaptive reuse of Classic Village of Wescosville home stock. Today after a very nice remodel this is home to two local businesses.

Adaptive reuse of classic old Village of Wescosville home stock. This is today after a very nice remodel. Now the home of two local businesses including Thrive Media.

Fantastic reuse of an old Church building. Now the home of Werner & Co. CPA's

Fantastic reuse of an old Church building. Now the home of Werner & Co. CPA’s and another small business Express sign outlet.

 Strategy: Let’s focus township efforts on triage and sprawl repair!
Sadly, just across from the two really wonderful projects above we have the result of a very poorly thought out zoning ordinance and decisions made years ago. Unfortunately, folks working in these unique buildings look out their windows everyday at this…

This WaWa represents really awful design.  It's the boilerplate generic WaWa. But making it worse is what everyone drives past is the side of the building. Recently the township had to make the store enclose dumpsters with that vinyl fence.

From inside Werner & Co beautiful re-purposed building their view is this…. Unfortunately our zoning code at the time allowed this replace an entire block of old home stock. Across the street the old home stock and block is now the home to 8 small businesses. This WaWa represents really awful neighborhood killing design. Not only is it the boilerplate generic WaWa. But making it worse is that everyone drives past the side of the building. There is no framing the public realm. No sidewalks. Up until very recently the view included dumpsters.

Important to note. The problem here isn’t that this is a convenience store. It’s the context, form and function. You can build almost any use save for the most auto dependent in a more community friendly way. Yet our zoning codes continue to fixate on separation of uses, when really we should concentrate more on the built form.

Our WAWA is what it is…. BUT what about a Private/Public partnership to improve it? How about erecting a new street wall that would welcome people to Lower Macungie like this? The township has already talked about a gateway. This would address some of the issues with the barren side wall and also make the whole more attractive and safer. We could if we had the wherewithal force WAWA to install sidewalks using the first class code. But I prefer a partnership.

 

Screen Shot 2015-02-02 at 2.47.47 PM

An then there is this: It’s not just aesthetics, walkability, adjacent property values, quality of life and character. Above all else it boils down to dollars & Cents!
The financial argument for neighborhood commercial development is equally if not more powerful then any other argument.

The Smart Math of Smart Growth. The building on the right is probably a little too tall for Hamilton Boulevard. But even a 3 story building (like the one currently being built at the old Pizza Hut) presents much better value and return for the community.

The Smart Math of Smart Growth. The building on the right is probably just a little too tall for Hamilton Boulevard by 1 story. But even a 3 story building (like the one currently being built at the old Pizza Hut) presents a drastically better value and return long term for the community.

Already today we are seeing the folly of giving away 50% of incremental revenue for a strip mall. Last week there was a joint meeting between Upper Mac and Lower Mac focusing on the Rt. 222 corridor. The exercise took into account all the new development along Rt. 222 including Hamilton Crossings and created traffic models. Article: Computer predicts traffic woes in Lower Macungie.

Big picture improvements were outlined so that the townships can go hat in hand to the state in attempt to get on 20-30 year planning budgets. Reality is the township will somehow have to secure easily over *1 million dollars to build what basically amounts to as band-aid improvements to address currently failing levels of service. LOS that will get worse once new development ramps up. Again, this is just for band-aids. The end game of grade separation will cost us over 100 million dollars. So in essence at the same time we desperately need money to address issues caused by development, we’ve let developers off the hook for paying their fair share over the next 20 years.
*no cost estimates were given except 500,000 for one of the lanes. Representing 1 of a half dozen projects. I think my estimate is actually very conservative.

What’s done is done. But moving forward we HAVE TO concentrate on building more financially resilient land development patterns that utilize and capitalize on already existing infrastructure by returning higher value over time. The simple fact is land on the Hamilton Corridor should be looked at as a commodity. The School District moreso then anyone else should understand this. Instead of blindly chasing the band-aid they should be concerned with long term resiliency of the tax base. That’s what smart growth is. Seeking the highest return on our built environment.


Lastly, we need to STOP BUILDING NASTY STROADS!

The STROAD: A street/road hybrid. Does nothing good. Not quite a street (value capture) not quite a road.  (move cars efficiently) Much like a futon is both a terrible sofa and terrible bed. Besides being a very dangerous environment they are enormously expensive to build and, ultimately, financially unproductive.

The nasty, ugly STROAD: A street/road hybrid. Does nothing good. If the purpose of a street is to capture value. And the purpose of a road is to move cars efficiently, then much like a futon is both a terrible sofa and terrible bed a STROAD is a bad street and also a bad road.
Besides being a very dangerous environment they are enormously expensive to build and, ultimately, financially unproductive.

Instead of STROADS build Boulevards!

As opposed to a STROAD a Boulevard is a more walkable, pleasant, attractive and higher value roadway.

As opposed to a STROAD a Boulevard is a more walkable, pleasant, attractive and higher value roadway.

 

Interested in these topics? Strongtowns posted 2 good blog posts this week.

Hayden Phillips ridiculous comment

I had to find a minute to write about this quick today. Northampton County Commissioners are considering an amendment that would use gaming money the county gets from the Sands to put another $750,000 into the county’s farmland preservation program and $400,000 into preserving open space and environmentally sensitive lands. 

farmland development

It looks like the board has the votes to pass this. Great news. UPDATE: 10:00pm Thur – The Amendment successfully passed.

But another part of this story is the Commissioner who dissented and a statement he made that is one of the most ridiculous I have ever heard a public official mutter.

“As we buy up farmland and take it out as a development option, we’re denying people a dream in suburbia.” – Hayden Phillips Northampton County Council

As if by preserving some farmland we are somehow going to take single family homes off the market en masse. Or somehow force people to move into densely packed cities. Anyone who drives around any suburban neighborhood in the Valley can plainly see that this isn’t the case by the number of units available in Surburbia. For those who prefer a suburban lifestyle it is by far and away the most abundant choice in the Valley. I also instinctively dislike anyone trying to force a narrowly defined worldview on me. I live in suburbia and like it but not everyone does. I have no right to define the American Dream.

Everybody has the fundamental right to live wherever they choose. What they don’t have is the right to have that choice be subsidized by others. Single family home subdivisions cost more in services than revenue generated. Always. Commercial development is how we fix that problem. Farmland however, is the most effective way. It’s about balancing revenue & liabilities. That is the most fundamental accounting task local governments are charged with. Balanced budgets. 

Farmland generates no crime. No traffic. Increases quality of life. (matter of opinion) Increases property values. (matter of fact) Doesn’t add new kids into school districts. Definite and clear long term ROI. ect. Even with Act 4 programs Farmland generates far more in property tax revenue than liabilities in services/infrastructure.

Letting opportunities pass to aggressively invest in preservation now will certainly lead to higher taxes down the road. Smart growth is not just about consumer demand for more livable communities, and not just about supporting congestion-mitigating transportation options such as complete streets it’s also about seeking growth that pays for itself and isn’t dependent on ether *constant growth (where you eventually run out of land) or direct/indirect subsidies.

*The Growth Ponzi Scheme

Bottom line is farmland preservation doesn’t somehow magically force people to live in cities. In fact it achieves the opposite. By creating a balanced mix of residential, commercial (preferably together as traditional neighborhoods) and most importantly farmland we keep the suburbs affordable. This enables those who choose that lifestyle (as I do) to be able to afford it.

 

 

Words still have meanings

I posted the first “words have meanings” last August. Check out the original post here. It was a longer post with some pictures & examples. This is a followup. Still an issue so I’ll keep re-posting. Developers continue to mis-label projects to curry favor with local government officials who don’t know any better. Terms with actual meanings are definitely bent to suit marketing purposes. Making matters worse journalists happily regurgitate developer characterizations. This is unfair to the public that genuinely desires more responsible smart growth development.

“Main St.”, “Mixed Use”, “Village Center”, “Walkable” ect. are all terms that have meanings.

Developers and marketing teams use of these buzzwords demonstrates they understand people want better communities. Problem is when we allow developers to mis-use terms without challenge we let those we represent down who then expect certain end products.

Just because a project smushes together incompatible single use buildings that would otherwise be separated and buffered on a small parcel doesn’t make it a mixed use project. Walking from your car to a single use building on a sidewalk does not make a project “walkable”. To qualify for these labels projects need measurable qualifiers.

  • Appropriate density.
  • Functional street grids
  • Vertical mixed use buildings or in a horizontal project compatible uses and context sensitivity. 
  • Actual functional walkability. The presence of sidewalks alone don’t make a project walkable
  • Diversity of architecture that respects heritage of the neighborhood
  • Complete streets
  • A measurable positive municipal return on investment and cash flow over multiple lifecycles – mixed use uses land more efficiently. 
  • Low impact on existing neighborhoods. Should reduce traffic not increase.

Top 5 characteristics of mixed use

Here is what spurred this post today:
‘Main street’ concept takes shape at Sterling Ridge

Mixed use "Main St." Village center?

Mixed use “Main St.” Village center? Really?

Not a mixed use. This is a low density auto-centric strip development with (maybe?) some bells and whistles. This isn’t necessarily a terrible project for what it is. But please. Label it correctly. This is a dual use project. 

What’s really sad is this is actually better than some of the projects that have been mis-labeled here in Lower Macungie from 2009-2013. (Hamilton Crossings, Allen Organ Development and most absurdly and blatantly incorrect the Jaindl warehouse development) The Allen organ development is a “dual use” project. Meaning we took uses that under our old ordinance would have been separated and buffered and allowed them to be built much closer together. The project lacks the meaningful integration to make it mixed use. It’s not a “neighborhood”. It’s commercial slammed against residential.

Sprawl’s Hidden Subsidies

I’m away for the week with my business partners shooting back to back destination weddings in Bermuda then Jamaica. (plug for my business here)

Didn’t want the blog to go dark for a week so decided to pre schedule a cross post from James Bacon over at www.smartgrowthforconservatives.com

If you are right of center politically and you think that smart growth is just for tree huggers or crazily some wacky agenda 21 conspiracy theory to take over the world then you should spend 5 minutes to read this post.

Then if the argument makes sense purchase Pamela Blais’s Perverse Cities and read itConservatives are missing a tremendous opportunity to re-frame the debate over growth and development in line with the principles of fiscal responsibility and free markets. I never will understand why. But it’s never too late to change.

Sprawl’s Hidden Subsidies

perverse_citiesby James A. Bacon

If planning and regulation were the answer to sprawl, then the Toronto metropolitan region ought to be a smart growth paradise. Toronto has a sophisticated, multi-tiered planning process, starting with an regional plan, plans for 30 upper-tier municipalities, and plans for 241 lower-tier municipalities (towns and townships, mostly). Yet outside the city of Toronto itself, which is undergoing a condo boom, there isn’t much to show for it.

The various municipal plans, which are comparable to Virginia’s comprehensive plans, define urban boundaries, control densities and show where growth should take place. The goal is for 40% of all new residential units to be built in already-urbanized areas. “That’s not happening,” says Pamela Blais, a city planner and principle of Toronto-based Metropole Consultants. “All the plans said all the right things. … [But] the regulatory approach isn’t sufficient to bring about the change.”

pamela_blais

The failure of regulation to halt sprawling, auto-centric development was the basis for Blais’ 2010 book, “Perverse Cities: Hidden Subsidies, Wonky Policy and Urban Sprawl.” She had researched and written the volume to figure out how the planners’ plans had gone awry. If smart growth made so much sense, and if planners had the power to bring it about, why weren’t developers and home builders doing what they were supposed to do? Something else had to be going on, she reasoned, something that was not commonly recognized.

As she delved into the subject, Blais found that real estate development is guided by massive hidden subsidies that shift costs from inefficient, land-intensive development to efficient, compact development. These invisible subsidies work at cross purposes to the regulations. As it turns out, developers follow the dollar.

Blais describes herself as a pragmatist. “It’s not an ideological argument I’m making,” she told Bacon’s Rebellion. “I’m interested in getting better cities. I’m happy to talk to everybody on the whole spectrum.” But her approach to urban development is one that fiscal and free-market conservatives can appreciate. The system for pricing public goods such as roads, water, sewer, electricity and public services bears little relationship to the cost of providing those services, she argues, with the result that a tangled skein of hidden subsidies incentivizes low-density development.

“Everybody thinks [sprawl] is the the invisible hand of the market. It’s a highly distorted market,” she says. “I’ve been arguing, let’s remove the distortions and take it from there. Remove the distortions and you’ll get a different development pattern. That should be the starting point.”
Continue reading

Ebike deregulation clears transportation committee

http://en.wikipedia.org/wiki/Electric_bicycle

http://en.wikipedia.org/wiki/Electric_bicycle

Part of smart growth is advocating for optional alternatives to automobiles. Folks like myself don’t want to stop driving or stop others from driving cars.  I like my car. I just want alternatives so I’m not forced to spend such a large chunk of my life in it. This is a trend with young adults nationwide who have less interest spending a quarter of their life in commute. Communities that grow in a way where a family can get by (if they choose to) with 1 car will be at a competitive advantage.

By design I live close enough to work to walk or bike if I choose. It’s something I enjoy doing. Once there, my office is located on a traditional Main St. where services like our bank and accountant are each less then 3 blocks away. We also have a half dozen lunch options within walking or biking distance.

Think about your household. How many cars? Now calculate how much it costs to own, insure and maintain them. Imagine the money saved by getting rid of just one. Complete streets, walkable communities and mixed land use policies allow options. That’s what it’s all about.

Recently, I started exploring the option of purchasing an Ebike.  Ebikes have been surging in popularity over the last few years. Ebikes are used by people with disabilities and seniors who like the extra assistance, those who want to reduce their carbon footprint and those who simply want to save a little gas moneyEbikes are not mopeds. They are bicycles powered by pedals with optional electric power. Ready to ride or kits to convert regular bikes have come down in price to a point where they are a viable option for those who want a little freedom from the car. I’m perfectly fine with pedals, but on a hot day the extra electric boost is great.

The issue I and others have run into is that ebikes are highly regulated in Pennsylvania. Most states treat bicycles with power assist as bicycles. Pa’s dated law classifies electric-assist bicycles as motorized pedalcycles or mopeds and therefore requires them to be licensed, titled & insured.

Federal law is very clear and treats Bicycles with electric assist of less then 750 watts of motor output and <20 mph top speed as bicycles and laws apply as such.

Last year state Senator Matt Smith proposed legislation legalizing pedal-assist electric bicycles. Senate Bill 997 deregulates pedal-assist electric bicycles treating electric bicycles the same as regular bicycles, meaning riders are not required to have insurance or register the two-wheeler. This would bring PA law in line with federal law which draws a distinction between ebikes and mopeds. Most smart growth policy is about deregulation and common sense reform. This falls squarely into that category.

SB 997 cleared a hurdle passing in the transportation committee by unanimous vote on Feb 4th. The measure now moves to the full Senate for consideration.

Read more:
Proposed Pennsylvania law would allow electric bikes without insurance, registration

 

Smart Growth for Conservatives

Proud to be a contributor at a new blog called “Smart Growth for Conservatives“. 

“Smart Growth for Conservatives provides analysis of transportation and land use issues from a center-right perspective, with an emphasis on fiscal conservatism and market-based solutions.”

Smart growth is an issue conservatives should rally around. At it’s core it’s a blueprint for building long term fiscally sustainable places. So why has it gotten such a bad rap from some in the conservative movement? I’m going to borrow heavily from some of Jim Bacon’s writing here. It’s largely Jim and Strongtowns Chuck Marohn who really hooked me on the underlying conservative rationale. Conservatives mistakenly equate smart growth with intrusive government intervention in the economy, with regulations, subsidies and  boondoggles. Unfortunately, nothing could be further from the truth.

First, while conservative intellectuals are spot-on in their critique of mass transit subsidies, they are blind to subsidies for roads and highways. While they hit the bulls-eye in their critique of land use restrictions, they ignore the systemic subsidies for green-field development. Their critique runs only one way. – Why Conservatives (mistakenly) hate smart growth – Bacons Rebellion

Bacon identifies 4 broad propositions. Here are the problems and reasons conservatives should be concerned. 

(1) The pattern and density of development has tremendous impacts on the prosperity, livability and fiscal sustainability of our places.

(2) The post-World War II pattern of disconnected, low-density, suburban-oriented development was largely the result of government interventions in the marketplace at the federal, state and local levels. 

(3) That pattern is increasingly dysfunctional, creating congestion and driving up the costs and liabilities of government. (Esp local gov’t!) When up front costs for new development are paid for with transfers of state and federal dollars down to local governments this leads to an illusion of wealth. The problem is when one time windfalls lead to long term liabilities for maintaining the new infrastructure. This exchange — a near-term cash advantage for a long-term financial obligation — is one element of a Ponzi scheme and is the centerpiece of the Strongtowns message. There is no denying we have a ticking time bomb of unfunded liabilities in our communities. We are dealing with this issue in Lower Macungie today.

(4) While many people do prefer auto-oriented communities, there is a pent-up demand for walkable urbanism with access to mass transit

Two patterns of Commercial development. 1. Strip Mall, 2. Traditional Main St.  One efficiently capitalizes on public infrastructure and public investments, the other is a resource hog, consuming large amount of of land usually in a towns most precious areas.

Two patterns of Commercial development. 1. Strip Mall, 2. Traditional Main St.
The traditional Main St. efficiently capitalizes on public investments in while the other is a resource hog consuming a large amount of of land in what should be a  towns most financially productive area but what ends up being the least efficient.

So we identified the problems and acknowledge why they are of concern to conservatives. What are the conservative solutions? Here are a few: (and relevance to Lower Macungie in gray)

1. Use the market. Market based open space preservation as a mechanism to keep taxes low. Programs such as Transferable Development Rights. Currently, in LMT we preserve open space primarily with agriculture protected zoning. This is fundamentally unfair to landowners and has failed catastrophically in LMT since it can be overturned by politicians. A TDR program pays landowners for voluntarily severing their development rights by creating a market for density. In a market, the community preserves valuable farmland which in turn keeps taxes low, land owners are fairly compensated for their property and lastly developers are able to purchase density to build in appropriate locations where the gov’t doesn’t need to subsidize their project.

2. Deregulate zoning codes and encourage value capture. We’ve largely regulated ourselves into the our current problems with Euclidean Zoning Codes. The opposite would be a form based zoning code. There will always be a need to separate certain uses. Warehousing is one that comes to mind. Unfortunately here in LMT we’ve allowed a proliferation to an extreme. Warehousing is one example where it’s in the public interest to mitigate impacts with regulations, buffers and costly super-sized infrastructure. But many of the uses we separate with unnecessary regulations don’t have to be if we allow developers to build in the traditional pattern. Think of Main St. Macungie. Here we have residents who live next store to banks, accountants and Doctors.  That’s the traditional pattern that worked for hundreds of years. It’s only recently that we steered away from it when we started building isolated pods. 

3. Do the math. Perform lifecycle cost and benefit analysis to see if development projects are being subsidized by taxpayers or if they “pay their own way” and indeed generate more revenue then liabilities they create. We’re currently considering subsidizing a massive strip mall project. We assume that it will be a tax benefit. Has anyone actually done the math over multiple life cycles? Sure looks great up front. Shiny new boxes and traffic signals. But what happens when the township has to pay for future improvements and maintenance of infrastructure when the bypass is inevitably so congested that it needs to be widened or we have to build a bypass of the bypass. Shouldn’t we be squeezing every bit of revenue out of our most valuable spaces rather then subsidizing the least efficient pattern? (see photo above)

4. Bottom up government. Build only what we can afford to maintain. As mentioned above top down gov’t distorts what a local municipality can actually afford to build with one time subsidies and windfalls. We need incremental economic development grown organically rather then artificially. We must ensure we can afford to pay for new infrastructure over the long run. (Do the math beyond the windfall) Here in LMT we’ve done a great job of securing millions of dollars in Gov’t grants over the years. I’m not arguing that was bad strategy. We’d be foolish not to seek top down money. But over the years we’ve avoided tough conversations about what happens when that money dries up. This conversation came to a boiling point this past Nov. during the tough tax conversations. We came to the realization that we must account for the long term fiscal sustainability of our township if we want to avoid lump sum huge tax increases in the future.  

Interested in learning more? Add www.smartgrowthforconservatives.com to your RSS feed.

About SGFC: Editor Jim Bacon publishes with financial support from Smart Growth America. A life-long journalist, Jim was editor of Virginia Business magazine before launching Bacon’s Rebellion, a blog dedicated to building more prosperous, livable and sustainable communities in Virginia. 

Our evolving relationship with the automobile.


New love is always most intense and passionate at first. No, America is not abandoning the car. But the love affair has plateaued. Don’t expect a breakup though. There will be no nasty divorce. What has happened is we’ve slowly settled into a new comfortable perhaps less obsessive relationship with our cars.

Most people will tell you that love can make you do some funny things. Our initial  love affair with the car was reflected in our reactionary 1950’s planning policy. At the time we were so blinded by the intensity of our new relationship that we abandoned traditional neighborhoods. We installed compartmentalized Euclidean zoning codes which led to isolated, disconnected pods of development. We weren’t thinking straight, but it was all good at the time cause the relationship was still shiny and new.

That love has unfortunately led to some unanticipated side effects. Communities became isolated lacking a sense of place.  Folks lived far from the places they worked. People spent huge chunks of their day isolated in cars commuting back and forth. And the new pattern was also very expensive and the only way to fund it was to double down on it. So we got trapped in a cycle. But blinded by love we didn’t see. Or more accurately we didn’t want to see.

No, there will be no divorce but today we are returning to a more healthy balance. Most people will tell you for any relationship to last you need balance. Young professionals are returning to the cities and 1st rung walkable suburbs in droves. Folks no longer want to spend a quarter of their life in cars. Survey after survey show people want connectivity. They want to live in places, not nebulous collections of isolated pods. They want options. It’s a lifestyle choice but also it’s a financial reality.

No, America is not breaking up with the car. We’re simply moving on to the realistic sustainable phase of our relationship with the auto. We now want other options in addition to our cars. We don’t want to spend every second with them.  We want a life outside of them. In the end this will lead to a much healthier relationship with the auto. The trend is undeniable. It’s time for governments both large and small to acknowledge it.

The chart below shows vehicle miles traveled, forecasts vs. actual. The black line represents the plateauing of miles driven. The colored lines are predictions by various levels of gov’t. Driving habits have changed but government remains locked into development patterns that reflect a love affair that’s cooled. 

Chart from Eric Sundquist of the State Smart Transportation Initiative. For the past decade, state and federal governments have consistently overestimated future growth in U.S. road travel.

Chart from Eric Sundquist of the State Smart Transportation Initiative. For the past decade, state and federal governments have consistently overestimated future growth in U.S. road travel.