Pay as you grow
By Gil Johnson, who lives in both Southeast Portland and outer Yamhill County. He is a former chair of the City Club Growth Management and Environment Committee.
Making a few fairly insignificant donations to campaigns and environmental non-profits sure can make you popular. But if any of these groups want my money this year or next, they should first take a look at Rick Bella's column in the suburban editions of Monday's Oregonian ('Sewage plan is one we should can').
Bella is no Steve Duin-style populist, but in this column he derides a Clackamas County sewer tax levied all over the county to pay for urban development in Damascus. Bella quotes county projections as projecting an 8 percent increase in sewage treatment charges for six years (effectively doubling these bills) and then a 5 percent increase for the next two years.
'I must have been absent the day they explained why residents of any given community ould want to subsidize growth,' Bella writes.
The people at 1000 Friends are offering up a couple of ballot measures to deal with Measure 37, one banning transferability of Measure 37 claims/waivers and the other allowing property owners to build an additional home on their land.
I propose they put out another measure, a constitutional amendment (which would reverse state law) requiring that developers pay for the infrastructure necessitated by any development. This would include sewer, water, roads, power lines, schools, police, fire stations and parks.
Developers argue that the additional property tax base they create pays these costs, but the taxes don't even come close. They also argue that if they had to pay all these system development charges, they would have to pass the costs along to the buyers and thus raise new home prices to the point where most people could not afford them.
The latter argument means that new developments, as currently designed and constructed, are too expensive, since someone has to pay for the infrastructure. Perhaps developers would be forced to design their tracts more efficiently, or perhaps they wouldn't be able to build them at all.
Measure 37 removed a key regulatory tool for land conservation. Passage of an infrastructure fee measre could slow down rampant simply by using the marketplace.
Call it 'Pay As You Grow.' Sell it not only on environmental grounds, but on economic fairness. Ask Bella's question: 'Why would you want to pay more so you can fight additional traffic?'
I run a small business and can't get out an organize as I did a few decades ago, but I will give money to the organization that attemps to get this measure on the ballot. I'll even go out with a clipboard and get signatures. And if it doesn't pass in 2006, I'll do in two years later, and so on until we educate enough citizens for it to pass.
Oct. 13, 2005
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Oct 13, '05
Gil Johnson: I propose they put out another measure, a constitutional amendment (which would reverse state law) requiring that developers pay for the infrastructure necessitated by any development. This would include sewer, water, roads, power lines, schools, police, fire stations and parks.
JK: Great idea. I’ll bet you can get OIA and McIntire on board for this one!!
Why not do it as a city or county charter amendment - it will require fewer signatures.
I’am on board because this will end the tax breaks for high density housing and urban renewal (See SavePortland.com). But we should be sure we are accurate in our accounting. For instance we should look at the net present value of property taxes expected to be paid and credit that against the net present value of the various infrastructure required.
I also think parks should not be required, as any decent sized lot includes enough backyard that mostly makes parks un-needed.
Of course power lines (and gas) are private enterprise and should not be included - presumably those companies already charge their true cost.
The really neat thing about this proposal is that when you truly assign costs, people will likely build on sustainable sized lots with enough space for a windmill and solar panels (and maybe a little micro-hydro) so the don’t even need the stinkin power company. At a couple acres, they also don’t need city water or sewer and they can grow a few veggies. This might start a movement to truly sustainable building. See home Power magazine at homepower.com.
Gil Johnson: Measure 37 removed a key regulatory tool for land conservation. Passage of an infrastructure fee measre could slow down rampant simply by using the marketplace. JK: Of course we can’t have a free marketplace with that “regulatory tool for land conservation” still in place. Why do we want to conserve land anyway? We are actually paying farmers to not grow things on it. And we only use a single digit percentage of it. Why should we live in high density, polluted, congested hell to keep an additional percent or two of Oregon’s land undeveloped?
With a declining world birth rate, there is little need to force higher density living down our throats - Oregon will never “fill up”. Never. Ever.
PS: The modern world runs on spinning magnets and hot gas.
Thanks JK
Oct 13, '05
While it sounds good, the risk you run with the Gil Johnson approach is that it could lead to more and larger gated communities. After all, if the new residents have to pay all the development costs for roads, schools, and parks, why should they let anyone else use them?
Oct 13, '05
Oh no, not the risk of a few more gated communities!
Is this the best argument against public subsidy of new development?
I could care less whether some new neighborhood wants to go the gated route. If that community pays for all the infrastructure and its maintenance, more power to them.
Oct 13, '05
In Oregon suburbia, the developers do build the roads, sewers, water lines etc. within their development. If not, system fees are assessed. In cities they seem to often get taxpayer "help" with these costs, as do many of those who build facilities "to provide jobs." The developers do have to negotiate for tax breaks, the city picking up costs, etc, as I understand it.
BUT, it is currently against state law to require they contribute to the cost of building schools, a law enacted in the 90's. There have been attempts to change it in the legislature over the last few sessions. The Home Builders Association, however, is very powerful in Salem.
Many other states do have system development charges for schools, parks and fire departments, especially schools. Stand for Children MAY put forward an initiative to require that developers contribute to the cost of school infrastructure. Would you help with that Gil?
Oct 13, '05
I'd like to see such an initiative cover all public services and costs, such as police and fire. I think this would win broader support, too. But if Stand for Children goes only for paying for schools, I'll get behind it. You know where to find me.
I considered the possibility of developers building nothing but big houses for rich people and putting in gated communities if these charges are in place. I think the gated communities will occur where there is a market for them, regardless of system development fees. Out in Yamhill County and further south, I can't see too much of that going on. But I can envision a whole bunch of tract homes going up on good farm land, aimed at middle income people who have the notion that the money they save on a house out here will offset the cost of driving 70 miles every day.
A corollary intiative might be one to eliminate the mortgage interest deduction on state taxes for second and subsequent homes.
As for ending tax abatements for downtown condos, I'm cool with that, too. I think Homer Williams, et al, would build them anyway.
I don't think we have to force density, but we need to permit density and perhaps offer a diversity of kinds of density. Mr. Karlock assumes that most people want to live in wide open spaces with football field backyards and enough space and enough amenities to never have to know your neighbors. If that is the case, why is the most expensive housing in Portland in the highest density neighborhoods? You can buy a whole block in Gresham or Tigard for what it costs for a 1,200 sq. ft. condo in the Pearl.
Developers have the same mindset as GM. They want to build big houses on big lots because that's what they know how to do, just like GM builds big cars with terrible gas mileage. Sure, there is a market for each, but there's a really under-appreciated market for other alternatives. Try to buy a Prius without having to wait several months. Try to find a decent house in Portland's bungalow belt (small yards, houses close together) for less than $300,000.
Oct 13, '05
Actually, Jim, OIA is opposed to pay as your grow laws, and they've written comments to the Secretary of State's office arguing against these initiatives.
I'd love it if you called them at 888-Land-use and asked them why.
Oct 13, '05
Gill stated, "You can buy a whole block in Gresham or Tigard for what it costs for a 1,200 sq. ft. condo in the Pearl."
Got any adresses of those blocks? I got buyers!
Evan, Do yo think Urban Renewal is pay as you grow?
11:02 p.m.
Oct 13, '05
Ready to buy--
They're probably in really bad parts of Rockwood. I know they sure aren't around here, where a house on a tiny lot is going for $300,000+. Seeing as a few dozen of these type homes can fit on a block, you're looking at millions of dollars. And that's the "cheap" homes.
Up the hill from me are the $1M+ homes.
Oct 13, '05
Our extra layer Metro chews though a big chunk of money every year.
How about dumping Metro and disribute their share to basic services?
And the PDC of course 8-)