Tag Archives: economics

Finding a Place for Parking

Parking spaces usually diminish public spaces — but it doesn’t have to be that way.

By Ethan Kent, Project for Public Spaces

 

Despite what you may have heard, nobody goes to a place solely because it has parking. In fact, the current obsession with parking is one of the biggest obstacles to achieving livable cities and towns, because it usually runs counter to what should be our paramount concern: creating places where people enjoy spending time. As long as the myth persists that economic prosperity depends on parking, local governments will continue to waste public money and distort the public planning process.

The realization that creating a place where people want to come and spend time is more important than parking unfortunately eludes many municipalities. Worrying about and wasting public money on parking is taking over the public planning process and subsequently parking is taking over our communities. So how can we put parking in its place and draw people back to public spaces?

One big step forward is to assess the supply of parking in relation to what is actually needed. PPS often works with towns that have excess parking capacity, where the growing number of surface lots and parking structures has choked out the very reason people drove there in the first place. In Salt Lake City, for instance, PPS’s land-use map highlighted the excess parking spaces within 1/4 mile of downtown, showing that the real shortage was of places for people to go, not spaces to park.

The hang-up on parking is an indicator that a community has no broader vision for itself.

This state of affairs arises when businesses compete with each other to maximize their own parking spaces–to the detriment of the surrounding community and, inevitably, themselves. The hang-up on parking is an indicator that a community has no broader vision for itself. Get businesses and other parties to cooperate creatively with each other, and you can create the kind of parking infrastructure that supports public spaces. Here are some questions to get businesses and public officials talking about creative new ways to accommodate parking needs with the public’s desire for lively public places:

10 Questions to Help Us Get the Most Out of Parking

1. Is it a destination worth creating parking spaces for?

Public dollars are often spent on large parking areas that provide no tax revenue and serve businesses that either compete with existing downtown businesses or would better serve the community if located downtown. But why should municipalities use public funds to subsidize parking spaces for destinations that don’t enhance the community as a whole? Spending the same money to instead make development more attractive and connected to downtown means taxes better spent, space better used, and communities better served.

2. Do the parking spaces really make more people want to go there?

Think of the most popular district in your region – places like downtown Cambridge, MA, or the French Quarter of New Orleans. Is it easy to park there? No way! But do people go? You bet! They’ll walk six blocks from their car to a store, and LIKE it! Which is to say that people don’t come to an area for the parking, they come for what’s distinct and special about that place. Why should towns create excess parking spaces if all that asphalt detracts from the qualities that attracted people in the first place? Many communities that have parking shortages are actually thriving.

3. Are parking regulations being obeyed?

When there appears to be a parking shortage, the most likely explanation is that people are simply not obeying parking laws. In the business district of Poughkeepsie, NY, PPS found that more than half the on-street parking was illegal. Parking turnover studies are an easy, inexpensive way to show where violations are happening and suggest how to enforce existing regulations more effectively.

4. Are there opportunities to share business parking lots that have demands at different times of day or week?

Parking areas for churches, theaters, restaurants and bars often sit vacant during peak hours, when demand is highest. Can these businesses and institutions be encouraged to let go of their dedicated parking areas and take advantage of existing nearby parking which is available on evenings and weekends? Put another way: Would people be more likely to go to church or the theater or a restaurant if they saw their destination as simply “downtown” and could easily visit more than one place per trip?

5. Where do employees park? If they have the same shifts, can they carpool?

Merchants and their employees consistently take on-street spots early in the morning and feed the meters all day. They should be encouraged to instead park in municipal parking lots, carpool, or take transit. These alternatives can be made more attractive by designating off-street spots, creating employee incentive programs, or implementing shorter meter times.

6. Is the timing and pricing of meters optimized for each location?

Different sections of the same street may have varying parking needs. The meters in front of a post office, for instance, may provide two whole hours of parking time, but only require ten minutes. Some parking spaces should be more expensive to encourage high turnover. Again, parking turnover studies can inform more appropriate regulations that fit the context of the street.

7. Are there adequate sidewalks and pedestrian amenities connecting off-street parking areas to downtown streets?

The walk to downtown shopping areas from many municipal parking lots and garages is so abysmal that many people won’t park there. Though such lots may provide significant quantities of parking, they will be underutilized if the walk from the car is poorly lit, dull, uncomfortable, or outright hazardous.

8. Are there opportunities for angled parking?

Lane widths in downtowns and on commercial streets need only be 8-10 feet, rather than the standard 12-plus feet. This means that many commercial streets are wide enough to accommodate angled parking in some sections. Angled parking can fit almost 50 percent more cars than parallel parking, and it calms traffic, creating a safer environment that’s more conducive to pedestrian use.

9. Can curb cuts be consolidated and narrowed?

Frequently, parking lot entrances and exits can be combined, narrowed or made one-way to make room for more on-street parking and a safer, more pleasant pedestrian environment.

10. Are there opportunities to share business drop-offs that have demands at different times of day?

Some truck or passenger drop-off areas are only used for predictable early morning or weekday periods and can be used for parking the rest of the time.

Once you start asking the right questions, ingenuity and cooperation will follow. In Littleton, New Hampshire, for example, PPS worked with the town to address its nagging parking problem by making downtown streets more walkable. Following a series of small, inexpensive traffic-calming experiments, the town is now partnering with several business owners to improve the pedestrian environment, reduce lane widths (and therefore automobile speeds), and expand the pedestrian-friendly downtown area. The improvements will increase the availability of parking spots from which people will feel comfortable walking to downtown by at least threefold. How? By enabling people to consolidate their car trips and visit more places from the same parking spot.

Of course, the biggest benefit of this plan is that more people go out on the sidewalk, which creates the very streetlife that makes other people–and businesses–want to come downtown. But that doesn’t happen automatically. In order to create a more desirable street environment for pedestrians, businesses, and drivers, you need to take full advantage of the opportunities presented by rethinking parking. These opportunities include:

• Pedestrian amenities: Street corners with more sidewalk space, seating, and plantings can become the focal points necessary to bring back pedestrians and streetlife.

• Improved safety: Curb extensions make sidewalks and pedestrians more visible to drivers. Narrower lanes slow vehicles and reduce risk to pedestrians and bicyclists. Replacing parking lots with in-fill development eliminates space that is perceived as unsafe and makes possible anonymous criminal behavior.

• Shorter crossing distances: Curb extensions at intersections create shorter crossing distances for pedestrians, and therefore shorter wait times for automobiles.

• Retail kiosks and cafés: Temporary or permanent retail stalls can be placed at the street edge of parking lots or in reclaimed parking spaces.

• Programming and multiple-use spaces: Existing parking lots can be converted–whole or in part–into public squares with markets, performance spaces and seating areas.

• Transit compatibility: By reducing the supply of parking, demand for transit goes up and new destinations form around transit stops.

Spending money on such public amenities instead of parking may seem radical, but in fact it is a wise investment. Pedestrians feel more comfortable walking because of the slower vehicle speeds and reduced number of curb cuts. Businesses get more passersby and first-time walk-ins. Drivers make fewer trips, waste less time in the car, get more exercise walking, and even enjoy the experience of driving downtown more — because it is a pleasant place to be, not a parking lot.

Consider the city of Copenhagen, which has instituted a policy to reduce parking by two percent each year. The risk has paid off many times over by the number of people who now walk and bike to the city center–all of whom, you can be sure, feel at least 50 percent more devotion for their home city.

 

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Many Cities Changing One-Way Streets Back

By Melanie Eversley, USA TODAY

12/20/06

More traffic will be coming to downtown Danville, Ill. — and that’s how Danville wants it. The city of 33,000 is converting some of its longtime one-way streets back to two-way thoroughfares. City officials hope the change will make it easier for customers to reach downtown stores and shop in them.

“The driving force behind it is economic development,” says city engineer David Schnelle, who expects to reprogram signals, change pavement markings and change signs by November 2007.

He says motorists tend to drive faster on one-way streets and go past their destinations, then lose time and patience backtracking.

Danville is one of hundreds of cities — from Berkeley, Calif., to Charleston, S.C. — switching one-way streets to two-way to improve commerce downtown, according to the American Planning Association in Chicago. The trend got rolling in the early 1990s and has expanded this year to bigger cities such as Miami, Dallas and Minneapolis. It’s part of the reinvention of former industrial cities, which are converting empty factories into loft housing and trying to convince suburbanites that downtowns are livable.

“There’s a lot of emphasis now on taming the automobile and emphasizing walking and biking. It’s all part of creating a place that people want to be,” says Marya Morris of the American Planning Association. “The bigger pieces are the major downtown housing booms and having things for people to do after 5.”

The boom in one-way streets began with the Cold War in the 1950s, when cities planned quick routes out of town for evacuation in case of nuclear attack, says John Norquist, one of the first vocal advocates of two-way-street conversion. Norquist was mayor of Milwaukee from 1988 to 2003 and now runs the Congress for the New Urbanism, which promotes the revitalization of cities.

The growth of the suburbs contributed, too, as cities smoothed the route home from work, says Neal Hawkins, associate director for traffic operations at the Iowa State University Center for Transportation Research and Education. Now, though, there are more jobs in the suburbs, more entertainment downtown, and drivers go in all directions.

They drive less efficiently on two-way streets, according to the Thoreau Institute, an environmental advocacy group in Oregon. The slower stop-and-go traffic means cars pollute more, the institute says.

In Danville, 170 miles south of Chicago, two-way streets are meant to speed an economic revival after 15 years of plant closings left downtown streets quiet. The city set up a small-business loan program to attract stores and restaurants.

Now Danville wants to make it easier for customers to find them, especially the shops on Vermilion Street.

Marie Pribble, co-owner of the Java Hut coffee shop and cafe, looks forward to the change. “The slower people go, the more likely they are to pay attention to your business or your storefront, and the more likely they are to stop in,” she says.

Norquist was one of the first mayors to promote more two-way streets. He led a campaign to convert several downtown Milwaukee streets back to two-way. He says the increased traffic means that neighborhoods flourish: “I think people started to realize that the city was more important than the road that runs through it.”

 

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Little-Known State Law Gives No Parking Perk

Certain employers must pay a stipend to those who don’t drive to work. L.A. hasn’t enforced it.

By Jean Guccione, LA Times Staff Writer

October 10, 2006

When his boss offered him $185 a month or free parking, Tom Fleming didn’t hesitate: He bought a $52-a-month bus pass and pocketed the difference.

 

That’s exactly what state lawmakers had in mind in 1992 when they enacted a law requiring certain employers to pay a monthly stipend to employees who carpool, ride public transit, walk or bike to work.

But “a lot of employers don’t even realize they should be doing it,” said Gennet Paauwe, a spokeswoman for the California Air Resources Board, which administers the program.

 

And employers aren’t the only ones with little information about the law: State officials have no idea how many businesses are required to offer the cash inducements, much less how many of them actually do.

 

Always on the lookout for ways to reduce traffic congestion, the Los Angeles City Council’s Transportation Committee on Wednesday will consider how to go about implementing and enforcing the so-called parking cash-out law.

 

“I think it’s clear that parking policies affect how people get to work,” said Councilwoman Wendy Greuel, who is the committee chairwoman. She cited studies showing that free parking encourages people to drive to work alone.

 

Conversely, 17% of all drivers offered cash in exchange for their free parking space will give up their vehicles, said Donald C. Shoup, a professor of urban planning at UCLA who helped write the state law.

 

“It treats every employee equally,” he said. “It’s much fairer than saying you get free parking or nothing.”

 

Statewide, only Santa Monica enforces the law. More than a decade ago, provisions of the statute were incorporated into a traffic management ordinance.

 

Throughout the Southland, free parking is an ingrained fringe benefit. The Southern California Assn. of Governments estimates that 95% of the people who drive to work park there for free, Shoup said.

 

Under the parking cash-out program, employers must pay a stipend equal to the cost of a parking space to workers who do not drive to the office. The law covers public and private employers that have at least 50 employees and that offer free parking in a leased lot.

 

Those restrictions mean that just 3% – or an estimated 290,000 of the state’s 11 million employer-paid parking spaces – are subject to the law, according to a 2002 report by the state legislative analyst’s office. About 84% of the free parking spaces are exempt because they are employer-owned.

 

Some larger employers offer free bus passes and other incentives to reduce car emissions under regional air quality guidelines. Those entities can satisfy smog-reduction requirements and the state law by incorporating parking cash-out subsidies.

 

Martin Wachs, director of the Rand Corp.’s Transportation, Space and Technology Program, called the cash-out program a “first step.” He said the city also should consider limiting parking in high-rises, especially those near public transit.

 

“It doesn’t make sense to me to spend billions to build subways and the buildings next to them that have seven, eight, 10 levels of parking that is provided free to those employees,” he said, noting that free parking will trump even the most easily accessible public transit.

 

Shoup studied eight Los Angeles-area firms whose workers were offered cash instead of free parking. His 1997 report concluded that, on average, 17% of the employees took the money.

 

The law does not cost employers any more than if every employee opted for free parking, Shoup said. In fact, the cash-out provision gives lower-paid employees who are more likely to take public transit benefits equal to those provided to their colleagues with cars.

 

The legislative analyst’s report found that employee participation ranged from 2% to 22% at various job sites, depending on such factors as the subsidy amount, business type, location and proximity to public transit. “High-paid employees with irregular schedules [are] not easily swayed by cash incentive,” the report states.

 

At the Century City law firm of Jeffer, Mangels, Butler & Marmaro, none of the lawyers has exchanged free parking for cash, firm officials said. But 17 other employees – including Fleming, the firm’s director of information, resources and management – took the money, said John Kramer, administrative operations manager. Each of the firm’s more than 200 employees gets a free parking space, valued at $185 a month, or the cash equivalent.

 

Fleming, 58, lives less than three miles away in West Hollywood. He said he was surprised when he moved here from Baltimore six years ago and was offered free parking. He takes the bus and the cash. “It’s a very nice bonus and it most definitely keeps me from driving,” he said.

 

Other companies have had greater success. More than half of the workers at an unnamed financial services firm in downtown Santa Monica cited in the legislative analyst’s report took a $200-a-month stipend and found another way to work. Since the law was enacted, Santa Monica has reduced employee parking by as much as 20% and increased the average number of passengers per vehicle from 1.3 to 1.5.

 

The city of Los Angeles does not require employers to submit annual traffic plans. But officials are exploring whether to revise tax forms to seek data essential in identifying businesses that should comply with the state law.

 

Shoup, the UCLA professor and author of “The High Cost of Free Parking,” applauded the city’s efforts. “Most of us assume that if the state passes a law, it will be enforced,” he said, noting that at the time he thought workers would push bosses to pay up.

 

But the Air Resources Board’s Paauwe said the law’s many exemptions make enforcement difficult. For now, it is “complaint driven,” she said. Possible violations may be reported by calling (800) 952-5588 or the local air district.

 

The statute includes a $500 fine per vehicle for noncompliance, but no one has been fined.

 

Shoup isn’t concerned that Los Angeles’ effort to enforce the law might take too long. “It has not been enforced since 1992,” he said. “We can wait to do it right.”

 

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Working Families Pay More for Transportation Than They Save on Affordable Housing

Detailed Data for 28 Major Metropolitan Areas Nationwide Finds That Moving Further From Work to Afford Housing May Not Mean More Money in Your Pocketbook

Washington, DC (October 11, 2006) – Low- to moderate-income working families are finding that as they move further from work to afford housing they end up spending as much, or more, on transportation costs than they are saving on housing, according to a new study of 28 major Metropolitan areas nationwide entitled A Heavy Load: The Combined Housing and Transportation Burdens of Working Families (http://www.nhc.org/pdf/pub_heavy_load_10_06.pdf).

Conducted by the Center for Housing Policy, the research affiliate of the National Housing Conference (NHC), the study also found that the combined burden of transportation and housing costs for working families was remarkably constant across all the Metropolitan areas studied at an average of 57 percent of annual income. This comprehensive study was conducted with support from the John D. and Catherine T. MacArthur Foundation and was released today in coordination with NHC’s 75th Anniversary Policy Summit in Chicago, IL.

“Working families are increasingly moving further from their jobs to find affordable housing. Yet, we found that many of these families end up spending more on transportation costs than they save on housing,” said Jeffrey Lubell, executive director of the Center for Housing Policy.

“Ultimately, these findings emphasize the importance of coordinating the development of housing and transportation policy, as well as expanding the supply of affordable housing close to both central city and suburban job centers, improving public transit in areas with lower housing costs and reducing the costs of commuting by car for working families.”

Housing and Transportation Tradeoffs

In 17 of the 28 Metropolitan areas studied, the average transportation expenses for working families with annual incomes ranging from $20,000 to $50,000 are actually higher than their housing costs. Overall, across all 28 Metro areas, working families spend an average of 28 percent, or $9,700, of their incomes on housing and nearly 30 percent, or $10,400, on transportation. Transportation costs are based on auto ownership, auto use and public transit use and take into account the cost of commuting, as well as traveling for school, errands and other daily routines.

While the share of income that working families devote to housing and transportation differed from Metro area to Metro area, the combined burden of the two expenses was remarkably similar across all areas. These combined costs range from a low of 54 percent in Pittsburgh to a high of 63 percent in San Francisco, with 25 of the 28 Metro areas within three percentage points of the average combined burden of 57 percent.

Among all American households and income levels, and not just working families, housing and transportation are also the two largest expenses, but consume a smaller share of income at a total of 48 percent.

How Working Families Get to Work

The vast majority of low- to moderate-income working family commuters – more than 85 percent – in the 28 Metro areas studied drive to work in private vehicles. Commuters in some Metro areas take advantage of public transit alternatives such as extensive rail systems and buses. By far, public transit serves the greatest share of working families in the New York Metro area at 31 percent, followed by Chicago, IL at 14 percent and Washington, DC at 13 percent. The Metro areas of Boston, MA, Honolulu, HI, Philadelphia, PA and San Francisco, CA all have an average of 12 percent of commuters taking public transit.

Housing and Transportation Policy Recommendations

Numerous policy recommendations have emerged as a result of these findings.

Specifically, it is essential for regions to coordinate their housing and transportation policies to ensure they fully reflect the needs of working families – one example includes building more affordable housing near existing and planned transit hubs. Additional recommendations include redevelopment of inner city and older suburban neighborhoods near job centers and targeting job development in low- to moderate-income neighborhoods in central cities and inner-ring suburbs. Policies to encourage car sharing and make car ownership more accessible and affordable could also help reduce the transportation cost burdens of working families who must commute by car.

 

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Around DC, a Cheaper House May Cost You

Longer Commutes Outweigh Savings of Living in Outer Suburbs, Study Shows

By Eric M. Weiss

Washington Post Staff Writer

Thursday, October 12, 2006

One of the lures of the outer suburbs is more house — maybe even one with a big yard — for less money. But a new study shows that the savings are illusory: The costs of longer commutes are so high that they can outweigh the cheaper mortgage payments.

A study of Washington and 27 other metropolitan areas by the Center for Housing Policy found that the costs of one-way commutes of as little as 12 to 15 miles — roughly the distance between Gaithersburg and Bethesda — cancel any savings on lower-priced outer-suburban homes.

“If you save $40,000 to $50,000 by not buying that house in Montgomery County but expand your commute by an extra 30 miles a day, you can certainly see how that new house could not end up being the deal you thought it was, especially if gas is at $3 a gallon,” said Lon Anderson, spokesman for AAA Mid-Atlantic. “But because of the exorbitant cost of housing closer in to [the District], they don’t have a choice if they want to live with their families in a home they can afford.”

Barbara J. Lipman, an author of the study, said that people tend to focus on all the zeroes that differentiate the price of a closer-in house from one in the outer suburbs, but they don’t realize how much they’re spending on commuting costs, such as gas, tires and insurance.

“Even if you save a couple of hundred dollars a month on your mortgage, it doesn’t nearly outweigh the costs of the cars you are driving,” she said.

The average cost of owning a 2006 Toyota Camry and driving it 15,000 miles a year with gas at $2.40 a gallon works out to $7,967 a year, according to AAA.

Higher gas prices put such a strain on Hannah and David Lynch’s budget that they decided to carpool instead of driving separately to their jobs from their Sterling home, even though she works in the District and he works in Baileys Crossroads.

Moving closer to their jobs is out, Hannah said, because “there is no way we could move into an equivalent three-bedroom house for the same amount,” she said. “We don’t want to downsize and give up a yard, for instance.”

Still, the frustrations of her 90-minute one-way commute can sometimes rankle, she said, “especially when there’s a stupidity delay on the [Dulles] Toll Road. It’s a trade-off.”

The study also found that a lack of affordable housing near job centers in the Washington area and elsewhere forces low- to moderate-income families to live in outer suburbs where transportation options are few and costs are high.

Families in the Washington area that earn $20,000 to $50,000 a year spend nearly a third of their income on housing, a figure exceeded only in the San Francisco area, the study says.

“We do have central-city job growth, but in Washington and other places, jobs are growing faster in the suburbs, and the population generally is suburbanizing farther and farther out,” said Lipman, who works for the Center for Housing Policy, which is a research arm of the National Housing Conference, a District-based, nonpartisan, nonprofit organization that advocates for affordable housing.

Of the 20 fastest-growing counties in the United States, 15 are located 30 miles or more from urban centers, including Loudoun and Stafford counties, Lipman said.

Lipman said many communities have identified a lack of affordable housing, traffic-clogged roads and longer commutes as critical issues but have not linked them. “One thing this study shows is the need to have regional solutions about both housing and transportation,” she said.

The study found that most people in the outer suburbs pay so much for transportation not just because of long commutes but also because they have to use their cars for nearly every errand and trip.

Lipman also said many of the trends will accelerate. The study noted that 62.1 percent of the U.S. metropolitan population lived in the suburbs in 1996, up from 55.1 percent in 1970.

And although the median national household income has risen 10.3 percent from 2000 to 2005, it has been outpaced by housing costs that have gone up 15.4 percent and transportation costs that have risen 13.4 percent over the same period. Gas prices, for instance, have been rising steadily over the past four years, more than doubling from $1.42 a gallon in June 2002 to $2.86 a gallon this past June.

Stewart Schwartz, executive director of the Coalition for Smarter Growth, said the data highlight a disconnect between where people live and work. Those with the highest commuting costs generally live on the eastern side of Washington, while many of the jobs are on the northern and western sides.

“A three-car family puts a lot of money into depreciating assets, instead of into mortgages and college educations,” he said.

 

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Location-Efficient Mortgages

By Dom Nozzi, AICP

Mortgage lending typically does not consider the financial burden of commuting and other transportation costs for a family living in a remote, single-use (i.e., only residential land use) suburban area.

By living in a house that is remote from jobs, schools, shopping, and recreation/culture means that the household must spend more for transportation — usually by owning a relatively large number of cars. Research by the National Resources Defense Council (NRDC) has shown that a typical family living in a more central location in Oakland drives only half as much as a similar family in a more remote location. The savings were measured at about $750 per month. Others report savings of $300 to $600 per month.

Higher overall payments (travel and mortgage) make the more remote home more risky to the lender than a comparable loan in a more central location.

The hope of groups supporting what are called “location-efficient” mortgages is that the lending formula can be changed so that a dollar a month saved on transportation can be applied to a dollar a month higher loan payment. As a result, families wanting to purchase a home in a more “location efficient” area could qualify for a higher mortgage than a family purchasing a remote, less location-efficient home.

Location-efficient mortgages create a way for banks and mortgage lenders to recognize the transportation savings that an “access rich” central location is able to benefit from. A portion of these savings can be used by such institutions to “stretch” their standard income-to-expenses ratios that are part of the mortgage application process.

Of course, this concept is a powerful affordable housing tool as well. With this approach, like the Energy Star mortgage program (commonly called “energy-efficient mortgages”), a lower income household could qualify for housing that would otherwise be “unaffordable” under conventional lending rules.

Location-efficient mortgages acknowledge that families save money when they “live locally.” Those who shop, work, go to school, and enjoy parks or culture locally don’t need to travel as much because their more compact and populated (location-efficient) area is pedestrian-friendly and amenity-accessible.

In the neighborhood which has good accessibility, residents can walk to the grocery store, ride the bus to work, pick up the laundry on the way home from work, walk to the park on weekends, and bike to the shopping center for weekend errands. Households are more likely to own one car, instead of two or more, and drive less than 900 miles per month.

By contrast, neighborhoods that provide good mobility are ones where residents live in a more sparsely settled area with one-acre lots on cul-de-sacs and other disconnected roads without sidewalks. Households often must depend on two or more cars to provide the mobility tasks that members of the household must deal with — tasks that the “access-rich” households often perform by walking, bicycling, or using the bus. Such households must devote an enormous amount of time to travel by car, which means, among other things, loss of free time, emission of relatively large amounts of air pollution, and consumption of relatively large amounts of gasoline.

Patrick Hare claims he came up with the idea originally. He called it “Near Transit (one car) Mortgages.” His point was that if a household was in a location-efficient area, it would be better able to shed the second household car. By doing so, about $3,000 per year could be saved — which translates into being able to make mortgage payments for a mortgage of about $34,000 with this money saved.

“Location Efficiency” is emphasizes how accessible things like jobs and parks and shopping are, rather than how mobile one must be to find such needed goods and services. A strong correlation has been found between a location-efficient house and how many miles are driven each year and the number of cars owned by a household. The key correlative factors for location efficiency are:

Relatively high residential density

Good access to public transit

Good access to shopping, services, cultural amenities, and schools

Good pedestrian “friendliness” of sidewalks, bikeways, benches, lighting, and plantings

The author of the study that found these correlations states that it is possible to project auto ownership and usage, and thus average travel costs, with good reliability.

The Internet now has something called “Location-Efficient Mortgage Advisor” software that a lender could use to determine mortgage qualification. It contains an area map which shows the location of the property that the hypothetical buyer is considering buying, and any bus stops, train stations, and principal cultural features near the property. It would also indicate walking distances. This information is merged by the software, which then calculates a “Location Efficient Value” (LEV), and enters a predetermined portion of the LEV into the mortgage formula calculation. (For those of you who enjoy playing with mortgage calculations, the Web page I cite below goes into detail that I won’t bore you with about how the “location-efficient mortgage” would work.)

To summarize, the benefits of the location-efficient mortgage are:

Creates affordable housing. Encourages home ownership opportunities for low- and moderate-income households.

Stimulates home purchases in low- and moderate-income urban neighborhoods.

Increases transit ridership.

Promotes infill and establishes a financial disincentive for sprawl

Supports local consumer services and cultural amenities.

Cuts energy consumption

Improves regional and local air quality.

Is all this a pipe dream that is too good to be true? Not at all. It is starting to happen. The Federal National Mortgage Company (“Fannie Mae”) was slated to do a market test of location-efficient mortgages in Chicago in February 1998.

The project is expected to help Fannie Mae achieve its “One Trillion Dollar Commitment” to expanded home ownership opportunities for low- and moderate-income households.

Some of the organizations that are supporting the location-efficient mortgage initiative are:

The Center for Neighborhood Technology

National Resources Defense Council

US Dept of Energy

US Dept of Transportation

Environmental Protection Agency

Surface Transportation Policy Project

Federal Transit Administration

The Chicago Public School System

The Chicago Board of Realtors

Sources for the above info:

Earthword, Issue #4

Center for Neighborhood Technology WWW Page

Contacts:

James “Kim” Hoeveler. 312-278-4800 email: hoeveler@cnt.org

Location-Efficient Mortgage Home Page: http://www.cnt.org/lem/

Patrick Hare 202-269-9334

David Goldstein 415-495-5996

 

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The High Costs of Sprawl

Sacramento Business Journal – Nov. 14, 2005

 

Study: Sprawl costs billions; Sacramento area pays high price Residents of the area centered on Sacramento will pay $57,093 per person by 2025 to cover the additional costs caused by sprawling development, second only to Las Vegas among U.S. economic centers that face the sprawl problem, a new book asserts.

The Sacramento “economic area,” made up of the traditional metro area plus neighboring rural counties, is No. 14 in the U.S. when ranked by sprawl costs, the authors say. The markets facing the highest costs are Los Angeles, Washington/Baltimore and the San Francisco Bay area, with costs associated with sprawl estimated at $535 billion, $384 billion and $378 billion respectively for the period from 2000 through 2025.

But while the total cost for Sacramento is $129.8 billion over that same span, the cost per person is much higher. Only Las Vegas — No. 15 in overall sprawl costs at $109.2 billion — had a higher per-capita cost, at $72,697 per person.

The authors of “Sprawl Costs: Economic Impacts of Unchecked Development” tapped the results of 10 years of research to conclude that shifting to more compact forms of development could save billions of dollars over time.

“Sprawl has direct and quantifiable costs to our economy and in our individual lives,” said Robert Burchell, co-author of the book and co-director of the Center for Urban Policy Research at Rutgers University.

“We are all paying a staggering price for sprawling development in this country, and that price will only go up as gas prices increase,” Burchell said. “Sprawling communities need longer public roads, increase the cost of new water and sewer hookups by 20 percent to 40 percent, impose higher costs on police and fire departments and schools, and more. These costs are passed on to businesses and residents through higher taxes and fees and sometimes through fewer public services. And in most cases, sprawling developments do not generate enough property taxes to cover these added costs.”

The additional costs amount to some $84 million a day nationwide, the authors concluded.

But shifting 25 percent of the anticipated low-density growth to more compact forms would save billions in the years ahead, the book said. Such a shift in the Sacramento area would translate to savings of $8.2 billion, or more than $3,600 per person, by the study’s calculation.

Planners in this region have been working to encourage more compact and transit-oriented development through a variety of means, including the Blueprint Project coordinated by the Sacramento Area Council of Governments .

Along with Burchell, the authors are Anthony Downs, senior fellow at the Brookings Institution; Barbara McCann, a transportation and land use policy writer; and Sahan Mukherji, research associate at the Rutgers center.

 

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