SCL responds to the Building Industry Association of the Greater Valley

Last week, on Mike Fitzgerald’s blog, John Beckman of the Building Industry Association of the Greater Valley returned to respond to my latest article on transportation and housing costs. Regular readers of SCL will remember Mr. Beckman from my post in early June where I challenged his argument against smart growth. Mr. Beckman countered in a subsequent letter to Fitzgerald, which I decided not to respond to. Last week, Mr. Beckman resurfaced, claiming to have vanquished my earlier “approach to demonize sprawl” while taking issue with my latest article explaining how Stocktonians spend a much greater percentage of their income on transportation than Bay Area residents.

Here are my thoughts on Mr. Beckman’s latest letter on transportation costs as well as some thoughts on his previous arguments.

In his July 12th letter posted on Fitzgerald’s blog, Mr. Beckman writes:

“This is a very simplistic analysis for the bold assertion that Stockton is a less affordable place to live than the Bay Area. This simple analysis excludes the discussion of real wages, real cost of living including food, entertainment, utility costs and taxes… The percentage of a person’s annual income spent on transportation in valley communities may be higher than the percentage spent by residents of the Bay Area but in isolation that one fact proves nothing.”

True, my analysis does not include other cost of living factors, but I wasn’t looking at total affordability. The point of the article is to emphasize the dramatic difference in affordability as measured by housing and transportation costs, which Mr. Beckman dismisses as trivial. I disagree. The average Stocktonian spends 26% of their income on transportation, which is much higher than folks in the Bay Area and has real economic implications. The extra costs of driving imposed by the city’s growth pattern constitutes a significant expense, leaving Stocktonians with less disposable income and less money for utilities, entertainment and food. These other cost of living factors Mr. Beckman mentions may well be more affordable in Stockton than the Bay Area, but the focus of the argument is that housing and transportation costs consume over half of our income, which is not ideal by any measure and provides a glimpse into the economic consequences imposed by needing to drive everywhere, all the time.  Perhaps in the future I will discuss all expenses and how land use policies affect our spending habits, but for now I’m sticking with transportation and housing.

Source: Center for Neighborhood Technology

From last week’s post on transportation and housing costs. You can see that Bay Area residents spend a smaller proportion of their annual income on transportation than Central Valley residents. Source: Center for Neighborhood Technology

Also, I will readily admit that the article title, “Stockton is more affordable than the Bay Area because of Sprawl,” is meant to capture a reader’s attention. Perhaps a more appropriate title would have been something like, “Stocktonians pay a higher percentage of their annual income on transportation expenses than Bay Area residents due to the city’s car-dependent growth pattern,” but that is not nearly as catchy.

While we’re at it, I’ll also respond to Mr. Beckman’s letter from June 12 refuting my arguments from my June 6th article on his misunderstanding of smart growth:

Central Valley residents want smart growth and there is data that proves it

When I pointed out that recent survey data shows pent up demand in the Central Valley for more compact and walkable communities, Mr. Beckman ignores this and instead responds by saying that if something isn’t available, it’s because the free market indicates that people don’t want it. But how can the market account for a good or service that is not currently being provided? It can’t. Moreover, the country’s single-family housing trend since WW2 has been entirely subsidized by government at all levels (federally funded highways, federally backed mortgages, free school bus transportation, etc) which contradicts Mr. Beckman’s assertion that the free market is responsible for our development patterns.

Mr. Beckman talks about the freedom to choose, but what about those of us who don’t want suburban homes or car-dependent apartment complexes? Consumers cannot choose something if it is not being provided. As the demographics of the valley shift, residents are increasingly in favor of more walkable communities. Moreover, for tangible proof of pent of demand, look no further than the University Lofts on the waterfront where professionals are paying well above market rate to live in a safe and inviting environment downtown. This is not an either-or argument. We will always have our big subdivisions, but we should also be providing walkable communities and encouraging infill development.

It is not the developer’s fault if a city cannot afford the services necessary to sustain sprawling subdivisions (but they share some of the responsibility)

Here’s where Mr. Beckman and I actually agree in part. It’s easy to blame developers for the economic toll sprawl takes on a community, but city leaders are the ones approving these developments in the first place. It’s a city’s responsibility to understand what it can and cannot afford in the short and long term before approving such projects. Yet, we can’t ignore the role developers played in driving the mass proliferation of suburban homes that led to the real estate crash and subsequent crash of property values, draining city coffers nationwide. It’s no coincidence that the cities that suffered the worst are the ones that sprawl the most (Las Vegas, Phoenix, Riverside, San Bernardino, etc).

This report by Smart Growth America explains why smart growth is more economically advantageous than traditional suburban development.

Lastly, I would like to reiterate some points about smart growth I discussed in June which Mr. Beckman has chosen not to address:

In my June article, I pointed out that Mr. Beckman’s critique of Fresno’s smart growth analysis was fundamentally incorrect because he misinterpreted the study to come to the erroneous conclusion that smart growth is actually more expensive than sprawl. Here’s what I said:

“In the other cities cited, (Smart Growth America) compared the costs and revenues of specific infill projects to conventional suburban developments.…This is not the same analysis conducted in Fresno. For Fresno, SGA reported a comparison between two different city-wide development alternatives, not specific development projects. Therefore, there is no need to calculate units per acre as Mr. Beckman has done because this is a straight one-to-one comparison between different city-wide scenarios of future growth.”

In his June 12th response, Mr. Beckman never acknowledges his error and instead simply dismisses the findings altogether on the grounds that the report’s metrics are not standard. (The report uses “acres” to measure revenue and “units” to measure costs of service. This is easily explained as services are measured per unit because a city provides services to each house or apartment, not each acre). Further, the data that Mr. Beckman disregards as “indefensible” was produced by the City of Fresno itself (the SGA report merely summarized the findings), so they have no incentive to skew the numbers in favor of smart growth.

Mr. Beckman also does not comment on the study I cited by noted developer Joe Minicozzi finding that compact development in Turlock, Modesto and Merced yields higher revenue-per-acre than conventional suburban development. This study is important because it provides analytical proof that smart growth is more economically efficient than traditional development, even in the Central Valley, and it’s telling that Mr. Beckman decided not to comment on it.

Despite Mr. Beckman’s views to the contrary, there is simply no real analytical defense for believing that traditional suburban development is more economically efficient for cities than smart, mixed-use development. And this is just from a financial standpoint, we haven’t even touched on the significant social, environmental and health impacts of traditional development patterns. There is certainly a discussion to be had about the right balance of single family housing, infill, zoning and mixed-uses to meet the city’s needs, but we can’t pretend as if our traditional development patterns were sustainable and that we should just return to the status quo.

Advertisements

Tags:

Categories: Community Commentary

Author:David A. Garcia

David A. Garcia founded SCL in March of 2012. He holds degrees from UCLA as well as Johns Hopkins University and currently works as the Chief Operating Officer at Ten Space in Downtown Stockton, and previously worked as a researcher/analyst for a congressional agency in Washington DC. The views expressed here are solely of the author.

5 Comments on “SCL responds to the Building Industry Association of the Greater Valley”

  1. Jon Seisa
    July 18, 2013 at 9:28 am #

    Though your comparative analysis is true, on the other hand it may not mean people are necessarily happier in San Francisco, or that it has positive lifestyle benefits, which I know is not the point of your analysis, but I think its an interesting additional sidebar.

    Recently, I ran across a blog where San Franciscans, current and new residences, voiced their frustrations and complaints about the city, they relayed great anxiety over its over-crowdedness (urbanicity), expensive amenities, high costs for food, the scarcity of parking for car owners, the excessive homeless population and being accosted by them for money, daily, and the filth with human urine and feces in the gutters and streets (and on this note I recollect reading a shocking news article regarding perpetual defecation by the homeless on BART escalators that accumulates the feces in the belt housing structure below).

    Additionally, the depression level is much higher in San Francisco than San Joaquin County, and San Francisco County ranks higher in suicide rates than San Joaquin County. Out of California’s 58 counties San Joaquin County ranks 52 (or 8.39 per 100,000) in its suicide death rate compared to San Francisco County which ranks higher at 32 (or 10.96 per 100,000), according to the CDC: http://www.worldlifeexpectancy.com/usa/california-suicide

    But I don’t necessarily believe that urban density is solely responsible for these negatives because Los Angeles ranked last at 58 (or 7.3 per 100,000), meaning its suicide rate was the least, and other Bay Area counties ranked at the low end of the scale. Obviously, there are more complexities involved in deciphering this and other factors need to be explored.

    • David Garcia
      July 19, 2013 at 8:12 am #

      Interesting metrics. I tend to not get too caught up in anecdotes because while someone’s experience may seem fairly unsettling, it can’t necessarily be generalizable to the whole population. That being said, SF and other cities grapple with the same urban issues. Interestingly enough, research has shown that quality of life is oftentimes relative, whereas someone in the suburbs may find parking scarcity to be unsettling, urbanites may not be as bothered by parking as they are by strip malls. There is a very nice article in the Atlantic Cities that goes over these dynamics.

      http://www.theatlanticcities.com/neighborhoods/2012/05/do-cities-really-makes-us-happier/1953/

      As far as suicides go, I find it interesting that rural CA counties have the highest rates of suicide by far, while counties with larger cities appear to have much lower rates. As you note, SF has a higher suicide rate than SJC, but both rates are very low, at least compared to the other counties in CA.

  2. Jon Seisa
    July 19, 2013 at 9:50 am #

    Yes, I thought it was strange that Northern California’s rural counties ranked higher in suicide than others. The rural poverty issue seems likely to be the main factor; the data didn’t reveal that in the publication, but perhaps the CDC report is more thorough in details. I think this is very serious, it shows economic stimulus policy neglect or deficiency by Sacramento and/or the federal government in rural areas that would otherwise enhance quality of life, or well-meaning policies harmful to rural regions and producing unforeseen ill-effects and consequences.

Trackbacks/Pingbacks

  1. Back in the ring for another swing - July 17, 2013

    […] Read Garcia’s entire post here. […]

  2. Smart Growth News – July 23, 2013 | Smart Growth America - July 23, 2013

    […] SCL Responds to the Building Industry Association of the Greater Valley Stockton City Limits (CA) – July 17, 2013 [Building Better Budgets] is important because it provides analytical proof that smart growth is more economically efficient than traditional development, even in the Central Valley, and it’s telling that Mr. Beckman decided not to comment on it. […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: