For years, Stockton has expanded outward, banking on the proliferation of single family homes and strip malls to keep the city’s coffers full. Last week, city leaders filed for chapter 9, making clear that this economic development strategy is no longer viable. Rather than a continued focus on expanding the city’s footprint, it actually makes more economic sense to focus on infill development. Building densely and reutilizing older buildings in downtown neighborhoods has provided other cities with a tremendous economic advantage outweighing the purported benefits of monstrous shopping centers and subdivisions. I have written before about cities on the East Coast that have reaped the windfalls of prioritizing downtown development, but can such a strategy work in the Central Valley, where sprawl has reigned supreme for 50 years?
Apparently, the answer is yes.
Joe Minicozzi, the developer from North Carolina whose data crunching revealed how building downtown creates a more efficient revenue stream for cities, has been touring around the
Central Valley espousing the virtues of dense downtown development. As noted before, Minicozzi ran the numbers in Modesto and found that downtown structures netted more tax dollars per acre than shopping centers on the edges of the city. For example, Minicozzi’s work shows that a modest, three-story building in downtown Modesto, housing a sports bar and commercial space, brings in five times the property tax revenue per acre than Vintage Square Mall, with the downtown address netting the city $38,000 per acre compared to just $7,000 from the mall.
Of course, basing land-use decisions off of just one case study might not be enough for skeptics of infill development. Luckily, Minicozzi has recently expanded his analysis to other Central Valley cities, and the results echo his findings in Modesto. Just down the road in Turlock, Minicozzi revealed that the city’s average downtown building brought in 48.6% more tax revenue per acre than the local Wal-Mart. Moreover, the city’s Main Street properties are valued at about $1.6 million per acre, more than the per acre value of the much larger Monte Vista Crossings shopping center ($1.2 million per acre). In Merced, Minicozzi found that downtown buildings net 40.5% more revenue than the city’s mall. It’s also worth noting that Minicozzi’s research was not funded by these cities.
Stockton’s situation would appear to be no different, and the analysis provided by Minicozzi serves as a strong example of how a smarter development plan can help lift Central Valley cities out of the recession doldrums. Because of Stockton’s financial situation, using the infrastructure we already have in place makes far more financial sense than continuing to move the city outward, consuming more resources than are available. To be sure, this doesn’t mean big subsidized public projects are the way to go. Instead, Minicozzi’s analysis simply shows us that better land use decisions need to be made so that we are using the city’s resources more efficiently. These kinds of decisions involve bringing developers to the table to come up with a reasonable plan to balance Stockton’s growth to make full use of the space the city already has. As Stockton and other area cities grapple with the lasting effects of the housing bust, it would be unwise to ignore the work done by Minicozzi showing how a better growth plan can result in a more efficient use of land.