Hat tip: Geoff Clegg.
I was recently directed to a paper co-authored by two scholars, John Carruthers of the US Department of Housing and Urban Development (HUD) and Gudmunder Ulfarsson of Washington University in Saint Louis, regarding the relationship between smart growth concepts and public finance.
Their article contains substantive empirical data that backs up an argument frequently made by champions of smart growth: Expansive, low-density development costs the public more than higher-density, “in-fill” development. Quoting from the article:
The results of the analysis link one of the main ideas behind smart growth—namely, that low-density, spatially expansive development patterns are more expensive to support—directly to public finance. While there is a lot of variation in how the density and the spatial expanse of development influence different types of services, other things being equal, sprawl, as a cost factor, nearly always raises per capita spending, and the effects translate into large dollar values when summed across the entire country. They are also quite large on a case-by-case basis when capitalized at a conventional long-term lending rate as approximations of opportunity costs. These findings strongly suggest that the reasoning behind fiscally motivated, anti-sprawl smart growth policy frameworks is sound.
While the paper does raise legitimate questions about the “quality” of those services provided, it also underscores the basic economic feasibility of smart growth. Indeed, it is definitive in its assessment that sprawl development does cost the public significantly more than smart growth development. To read the 34 page paper, click here.
Interestingly, in another recent article, the LA Weekly claims that the economic feasibility of smart growth has been exploited and perverted by developers who use the term “smart growth” in order to secure public funding for projects that actually qualify as sprawl. In other words, sprawl development has sometimes adopted the rhetorical terms and conditions of smart growth, and although this has been used as simply a device, sprawl developments may superficially implement a cherry-picked set of requirements to qualify for publicly-funded incentives. For example:
Pacific Coast Capital Partners found a way to redefine smart growth, transforming the phrase to mean any infill project in a low-income neighborhood. The firm then traveled to government-employee pension boards up and down the Golden State, using the marketing magic of smart growth to seek funds for development.
The timing was perfect. State Treasurer Phil Angelides was already encouraging CalPers, the nation’s largest pension fund, to invest in inner-city real estate projects. In 2004, the Los Angeles City Employee Retirement System, which represents nearly 42,000 retired and current city employees, voted to invest $10 million in the fund managed by Pacific Coast Capital Partners known as Southern California Smart Growth. The fund manager promised to deliver a “double bottom line” — bringing social benefits while wisely investing in promising real estate projects.
Yet oddly enough, one of the fund’s first major acquisitions was an existing 47-acre outdoor outlet mall in the San Ysidro neighborhood of San Diego.
When considering the significant growth of our region, it seems wise to look at the empirical data and to stand guard against those who seek to exploit a “catch-all” phrase to build developments that are, in reality, adverse to the public’s best interest. Although we may be over a decade behind much of the nation in the implementation of smart growth, we are afforded the unique opportunity of learning from others’ mistakes. And the lesson is to recognize the purity of the concept, to wholly understand what it means to grow smartly– green space, in-fill, inner-core, and downtown revitalization and redevelopment, walkability and a deemphasis of car-centric transit.
CenLamar 
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