by Randal O’Toole
Conclusion
As it is usually practiced, regional growth management planning imposes huge costs on home buyers, renters, and businesses. Yet it provides negligible benefits: it does little to reduce sprawl (if that can even be considered a benefit), and its greatest social effect is to sort urban areas into central cities largely composed of young singles and childless couples and suburbs with high percentages of families with children.
The key to affordable housing is the availability of relatively unregulated vacant land for housing and other urban purposes. The effects of denying homebuilders access to such developable land appears to be an almost relentless upward push of housing prices. In 1979, price-to-income ratios in coastal California cities were greater than 4. By 1989, they exceeded 5.0. Thanks to a major recession in the early 1990s, they were still between 5 and 6 by 1999, but today they are mostly greater than 8. Prices may be declining now, but—unless changes are made—states such as Arizona, Florida, and Oregon whose price-to-income ratios were 4 or more in 2006 can expect to have California’s price-to-income ratios in a decade or two.
Remedies for unaffordable housing will require actions at the federal, state, and local levels.
• The federal government should revoke requirements that all urban areas must be represented by metropolitan planning organizations. Congress should also repeal the comprehensive, long-range planning requirements found in federal transportation and housing legislation.
• States with growth-management laws should repeal those laws and other states should avoid passing similar ones.
• Other state laws that give cities power to control the rate of development of rural areas, such as the California law creating local agency formation commissions, should also be repealed. Instead, states should insure that plenty of vacant land is available to meet each region’s need for housing and other land uses.
• Local governments should resist efforts by MPOs and other regional agencies to impose region-wide planning on their urban areas.
• As far as possible, infrastructure should be paid for by developers or property owners through annual user fees and special service districts rather than through up-front impact fees or general taxation.
Urban planners, of course, may oppose these actions. Instead, they aspire to pass growth-management laws in every state and impose growth-management plans on every urban area. The predictable result will be increasingly unaffordable housing, declining homeownership rates, and a growing disparity between the elite who own their own homes and a significant number of families who will never become homeowners.
Read the entire essay: The Planning Tax, The Case Against Regional Growth Management Planning