Development pattern productivity, continued

“No additional financial impacts are anticipated,” claims the staff report accompanying proposed revisions to Northfield’s nightmare land development regulations. Yet the proposed changes will change zoning around Northfield’s downtown to make lower density, less compact development the default pattern and this does have financial impacts for the City of Northfield.

The motivation for the changes is to make development easier and help cure Northfield’s purported reputation hostility to business, developers and development. Yet the discussion has only focused on making it easier and cheaper for developers and not on the longer term impacts for the City of Northfield and its taxpayers.

Mayor Graham was the first (but certainly not the last) person to call me anti-growth and anti-business, so let me say again that neither is true. I wholeheartedly support making the development permit process easy, predictable and cheap for developers. I urge the Council, Economic Development Authority, NDDC, and Chamber to work to encourage business and development in Northfield by retaining current business and attracting new companies.

But, and of course there was a but, I continue to advocate for the City to work to make developing in a pattern which will sustain the City financially the easiest choice rather than changing the regulations to development which is less profitable for the City the norm. Tonight, the Council should have a robust discussion about how to make the most productive use of land in Northfield for the taxpayers and how to help developers make money in the short term so the City can prosper in the long term.

Private development depends on a great deal of public infrastructure water, wastewater, stormwater, and roads.  While developers usually pay for the required improvements (but the proposed business park plans also proposed to subsidize this, too), the infrastructure is all dedicated to the City – to me and my fellow taxpayers – to maintain, repair and eventually replace. It matters a great deal whether the development the City permits can pay for the costs to maintain the infrastructure and some development patterns yield more revenue.

To help the Council consider what I mean about more productive vs. less productive development patterns, let’s do the numbers. Following in the footsteps of Strong Towns “Taco Johns math” in Brainerd and Joe Minicozzi’s work in Asheville, NC (and an additional example from Rochester), I offer three examples of different development patterns in Northfield with taxable market values and tax revenues (from Rice County public records) compared on a per acre basis to compare apples to apples. The downtown block is by far the most efficient and highest producing use of land on a per acre basis.

When considering how to zone and regulate land, the City’s interest should be to guide development in a pattern which produces the most tax revenue for the least cost in terms of infrastructure. The proposed revisions to the LDC help create lower density and lower productivity for the City.

Downtown Block

The development pattern is on a traditional grid street pattern with mostly two-story construction (there are a couple of single story buildings plus the taller First National Bank and Grand Event Center), zero setbacks, and sidewalks. This block has a mix of residential (apartments on upper floors along Division Street as well as an apartment building on Washington), retail and service businesses at street level plus additional business uses on upper floors (this makes for greater density of jobs, too).

Downtown block bounded by Division, Washington, 3rd and 4th Streets

Downtown block bounded by Division, Washington, 3rd and 4th Streets

  • Total acres: 1.71 (not including city parking lots)
  • Total Market value: $4,192,400 (not including value of parking lots)
  • Total Tax revenue (State, county & city level): $148,586
  • Value per acre: $2,451,696 (w/o parking)
  • Tax revenue per acre: $86,892 (w/o parking)

Southgate Mall development, Highway 3

This development was built in 1976, well into the suburban, highway and automobile-oriented phase.  The single-story structure with parking in front on a state highway frontage road is difficult to reach except by car. The sidewalk and new-ish bike trail along the river behind this development get pedestrians and bicycles close, but there is still no direct access. The highway oriented development requires considerably more infrastructure – a frontage road and a state trunk highway – as well as requiring off-street parking for additional distance for pipes and more stormwater runoff to manage.

Southgate development, Highway 3 south

Southgate development, Highway 3 south

  • Total acres: 1.16
  • Total market value: $152,500
  • Total tax Revenue: $4,982
  • Value per acre: $131,466
  • Tax revenue per acre: $4,295

Target/Cub development

Moving further south on Highway 3, the early 21st century big box development of Target and Cub (plus Applebee’s Restaurant) is also single-story, requiring a much greater amount of land for parking and the location at the far south end of town makes it less accessible for many on foot or bicycle.  Additional improvements to highway intersections and local connections streets added to the public cost.

Target, Cub Foods and Applebees development, Highway 3 south

Target, Cub Foods and Applebees development, Highway 3 south

  • Total acres: 26.4 (13.8 for Applebees/Cub + 12.6 for Target)
  • Total market value: $10,721,700
  • Total tax revenue: $446,882
  •  Per acre value: $406,125
  • Per acre tax revenue: $16,927

On a per acre comparison, the denser, multi-story, mixed use downtown block is the clear winner as I’ve argued before, but now provide the numbers.  As luck would have it, the proposed land development regulations share an agenda with a proposed resolution supporting a state omnibus transportation funding bill that provides additional dedicated state funding for city streets (including non-MSA street maintenance, construction and reconstruction).  How much of the pain the omnibus transportation funding bill is trying to solve is self-inflicted by building more than we can afford?

Consider why Northfield and other cities need more money for local roads; one reason is that cities have built a great deal of infrastructure to support very low return development that cannot support itself. Working toward revising how we build can also help change how resilient and prosperous Northfield will be in the future.


Happy New Year from Finland

IMG_1326Hyvää Uutta Vuotta from Jyvaskyla, Finland where I’ll be spending the next 6 months or so. Jyvaskyla has about 135,000 people (like Northfield, about 25% of those are students) on about 52 sq. miles in Central Finland.  For landscape, think northern Minnesota.  Lots of birch and pine, many lakes, and usually much snow (but not this year).

Compared to Cambridge, my Michaelmas Term home, with glorious medieval architecture surrounded by Victorian terrace houses mixed with some not very noteworthy contemporary buildings (5 stories is about the maximum; 3 or 4 more likely), Jyvaskyla is a thoroughly modern city of high density high rises (I live on the 7th floor in the center of town).  While Cambridge built stone and brick buildings, Jyvaskyla’s old (19th century) built environment was wood and has now been almost entirely replaced.

Sadly, Jyvaskyla “solved” its traffic congestion problems by running the highway between the city and Jylasjarvi – one of the lakes: “For decades, the problem of through traffic had bothered the people of the town and this was resolved in 1989 with the completion of new Rantaväylä roads along the shoreline of the lake.”  The center of town was pedestrianized, but the lake is now cut off from the city and strolling around it is unpleasant on the highway side. Could be worse, I suppose, and the highway could go right through downtown the way it does in Northfield.  Because the highway blocks access to the lake and new bits of the University of Jyvaskyla, there are underpasses somewhat like the proposed TIGER trail in Northfield to link neighborhoods and the lake.

The other curious piece of Finland planning is the shopping mall – multiple small malls in central Jyvaskyla – in the walkable city center.  I admit, when there are so few hours of daylight (I’m used to the cold), artificially lit insides have some superficial appeal.  But not much.  Timo Hämäläinen blogged about this phenomenon (and summed it up well) which was subsequently picked up by Atlantic Cities; I hope to pick Timo’s brain a bit more in the next month or so.

In the cows, colleges and contentment department, Cambridge beat out Northfield to win my personal Cows and Colleges award.  Jyvaskyla has colleges, but is sadly lacking in cattle.  More from Finland soon.


Dear Senator Dahle

With the power shift in the state legislature, I’m looking forward to the legislative session with a teeny tiny bit of hope and a whole lot of apprehension.  My apprehension level rose precipitously yesterday when I read my new state senator’s tweet (@KevinDahle) that he’d been meeting with a district mayor as part of working to increase local government aid.  Oh dear, Senator Dahle, but that’s starting at the wrong end of the policy process and so early in the session, too.

Dear Senator Dahle,

A very nice deck chair from the Titanic

A very nice deck chair from the Titanic

Congratulations on your election and the start of the new session!  As a recovering local government official, I know that the state legislature has a great influence on how cities can do their business. I write today to offer a few ideas about how the state could help rather than hinder local governments.  I encourage you (indeed my support in any future election depends on it) to look at the larger, longer term policy picture rather rearranging the deck chairs on the titanic ship of the state of Minnesota.

More than 20 years ago, the Citizens’ League published Remaking the Minnesota Miracle which studied the state/local fiscal system to determine what “realigning of responsibilities and revenue raising authority would have to occur” to finance state and local services and increase accountability.  Although the specific recommendations are interesting (the report calls for eliminating LGA), I hope you’ll consider the 4 principles for evaluating the fiscal system which seem very relevant and not time-bound:

Accountability: Responsibility for services should be assigned to the entity that is accountable to the electorate, the recipient of the service, and the governmental unit or persons paying for the service

Effectiveness: Responsibility for services should be assigned to the entity, public or private, that gets the job done well and measures for results.

Economy: Responsibility for services should be assigned to the entity, public or private, that can supply the service at the lowest possible cost.  For instance, in developed areas, water treatment and sewage facilities can be provided less expensively on a regional basis than on an individual city basis.

Equity: Responsibility for services should be assigned to the entities that can finance the service equitably and ensure equity in the delivery of services to all persons.

Certainly, almost any proposal will address some of these values strongly and others more tentatively or will demonstrate the tension between values.  Equity or accountability might strain economy, for example.  Still, these values can help think about what level of government or what private entity is best situated to deliver or fund services and, as a result, where decision-making control should reside.

I hope you have received a copy of the Property Tax working group’s report which also addresses what property taxes are intended to fund and to disentangle state control from local functions.  The history of the development of the property tax in Minnesota is well worth reading as “You may ask yourself, well, how did I get here?”

Finally, consider how other regulation affects the tax picture and how the state legislature can incentivize better spending strategies and foster innovation at the local level.

  • The “grow our way to prosperity” model must be reexamined to allow cities, counties and the state to maximize their existing investment in infrastructure rather than expanding infrastructure (and the obligation to maintain it) in the hope of attracting enough new business to pay for the existing system.  There is a burgeoning amount of data showing the cost of this strategy to local and state government.
  • Consider school siting philosophies which demand open space and favor new schools rather than renovation also make it harder for children to walk to school (adding busing costs and congestion).  
  • Think about how state government, with its larger scope, can help local entities work collaboratively (especially those outside the Metro Council’s jurisdiction) to deliver services efficiently and economically rather than pitting them against each other or forcing a sort of local protectionism.  We need to be able to develop shared solutions for transportation, land use, resource protection, and service delivery.
  • Transportation and infrastructure spending is a big deal at all levels of government.  Land use, environmental regulation, public health and quality of life are deeply intertwined with transportation policy; please try to see the whole landscape to make policy which helps local and state government invest wisely, support productive growth patterns, and build places where we want to live, work and invest time and effort.

Thanks for reading and I await your updates and other news of what’s happening in St. Paul.  I’m counting on your leadership to help develop policies which benefit all Minnesotans for the long term, not just the ones yelling at you right now.  Of course, I also know that change happens incrementally as you work to build support and make compromises (and that’s just within the DFL), but I am looking for the conversation to shift away from reactive government to thoughtful, sustainable policy-making.  Good luck!

Yours sincerely,

Betsey Buckheit




More about development economics and history


My office…before

I’ve been cleaning out my office at the end of my Council term.  In addition to recycling mountains of paper and gaining a great deal more storage space, I’ve been pleased to discover that my personal policy development has been quite systematic from my days on the Planning Commission to the present.

I even found my first Planning Commission fan mail. This little note from 2002 was sent in response to my questions about one of the residential developments underway at the time and applauding for standing up to the Council which was calling me anti-development.  What I was starting to ask, in a very clumsy way, was what’s the cost to taxpayers of various kinds of development rather than trying to reduce the impact of government on development costs for particular projects (which is what people usually glom onto).

My point all along has been: government is a player in the market (by regulating what can be built, incentivizing/subsidizing certain types of projects, by its tax structure) and as a party to individual development deals like subdivisions, planned unit developments, etc.

While working to develop policy and regulations which do not unfairly burden business (in the short term), the city must also consider its own (that is, taxpayers’) interests in the long term (call it a governance perspective).

Fortunately, many others have started asking the same questions (and/or the internet resources have been exploding to make them more accessible) over the last 10 years and here are a few of the things I wish I’d been able to bring up in 2002 and certainly want to highlight in 2012:

For all that residential development, I wish I’d had The power of greenfield economics ready at hand and been able to speak intelligently about “the proverbial elephant in the room [which] is the amount of sprawling, redundant public and private infrastructure we’ve built since the end of World War II.”

So now, as Northfield struggles to fund maintenance of all that infrastructure it has already built, the city might be able to ask how government policies (from the feds on down) have been part of the problem and how Northfield can look beyond what seem like quick solutions to longer term, sustainable changes which both support economic development without adding to Northfield’s long term debt burden and forgoing tax revenue through tax abatements or other incentives.

And some follow-up:

That NY Times series on subsidies got a lot of attention from the policy people.  MN2020 published its own 2 part series with Part 1 and Part 2 (the more interesting of the two with details of an Iowa subsidy situation).  MN2020  also cites its 2007 report Chasing smokestacks, stranding small business focusing on shifting MN public policy. Strong Towns included links to the NYT series in their Friday Digest.

...and after

…and after




End of the road

I really don’t know how I missed this one, but in 2009 Virginia enacted a law which doesn’t quite ban cul-de-sacs, but makes state funding for street maintenance and services contingent on not building any more of them.  I really don’t know how I missed it because this development was selected by the New York Times as a 2009 Idea of the Year and got a lot of other press.

Why is this noteworthy? 

I’ve been anti cul de sac for years.  Not because I don’t like 3 car garages, as has been suggested somewhere recently.  Not because I am anti-car/pro-bike.  Not because I have some aesthetic problem with suburban development.  Because CUL DE SACS COST MORE – it is more expensive to plow snow, there are very few taxpayers per foot of street surface, and they force traffic onto a few collector streets which are often less direct, longer and wider (more pavement, more cost).

Less direct costs: The lack of a connected street network also makes transit service so inefficient as to be almost impossible (requiring huge subsidy as well as making travel time unreasonable and usage low), makes walking and cycling connections more difficult, and creates traffic issues like those around Northfield’s middle school (which costs the school district more in busing and created a deadly intersection which will cost much to retrofit).  The downstream costs to air quality and public health are only beginning to be calculated.

How Virginia does it: In VA, streets are built then dedicated to the Commonwealth – apparently, much street maintenance is funded at the state level.  Now, before being accepted, the street is reviewed to determine if it “meets or exceeds the public service, pedestrian accommodation, and connectivity requirements.”  otherwise, the street will not be accepted into the network (and the local unit of government is on the hook).

Infrastructure is expensive.  In the future, Northfield needs to understand that not all street patterns come with the same price tag – we need to either transfer the full life-cycle cost of inefficiency to those who would like to build this way or look to changing development patterns for sustainable infrastructure spending.

User-friendly planning and development regulations

Facilitating frictionless economic development certainly got my attention.  Consider this statement:

Imagine you are trying to figure out how to apply for a permit for your new (or existing) business, and you land upon a maze of forms and requirements. You’re trying to do the right thing, but the bureaucracy isn’t making it easy. You go from feeling like a good citizen to feeling like a frustrated victim. And now it’s not just a permit you need, but a zoning clearance as well. Really? Why? Is this really necessary? Yargh!!

Does this sound familiar in Northfield?  It does to me as a former member of the Planning Commission and as a Council member.  Santa Cruz with Code for America, has attempted a common-sense development process with Open Counter (in beta release).  What do you think?

Of course, this is only the public face of the issue.  In Northfield, we still need to continue to revise the Land Development Code (which would be behind the clever, common-sense interface) for clear, predictable, flexible regulations which mandate compliance on aspects of development over which the city needs some control* but is otherwise adaptable.

*needs some control: I used to think we should regulate everything to “get the development we wanted.”  I now think no gov’t entity knows what it wants or how to get it (especially using the blunt, blunt zoning tool) and should leave that to the private sector.  But, some development decisions matter a great deal to the city and those are the ones which cost us money over the long term – infrastructure, street layout, parking, traffic issues, environmental issues.

Hospital study

Why study the hospital/city relationship at all since this is obviously an emotionally charged issue?

The city needs to ask tough, even painful, questions because it has real, structural budget issues which cannot be solved by a few cuts or some temporary austerity.  Even assuming the city keeps receiving local government aid from the state, it cannot maintain the infrastructure and facilities it currently has and struggles to continue services at the same levels.  The council is already facing the need to increase property taxes for the new public safety facilities and it cannot use the tax tool to solve all the problems.

What else can the city do?  Ask tough questions about everything the city owns, provides, and maintains to understand city operations and be able to make better decisions.  Ask if there are different ways to provide services.  Ask what the city can do to enhance its economic development potential.  Ask what tools are available (legally, politically, practically) to help ensure Northfield is a financially resilient city for the long term.

The hospital is our biggest asset.  Over just the last few years, starting in 2005, “the hospital” has grown to be the Northfield Hospital and Clinics in Northfield, Lonsdale, Lakeville, Farmington, and soon in Elko Newmarket.  The council and residents need to know how Northfield city ownership of a regional health system works, then ask what actions we might take to ensure the financial health of city and its healthcare system for the long term.

The City Charter divides up the responsibilities between the council-appointed hospital board and the council.  The hospital board controls and manages all hospitals and related medical facilities, but has no power to construct additional facilities, buy or sell any of these, or to levy taxes.  The council has the powers to construct new facilities, buy and sell them and levy taxes, but has no role in the operation of the hospital.  Despite approving the expansion by approving each land purchase, clinic project, etc., the council has not kept current with hospital strategy in a way that lets it understand what it means to own a regional healthcare system rather than a single hospital.

What basic principles will guide the discussion?  Perhaps some like this:

  • The council will not attempt to study healthcare industry, the future of healthcare, or the success of the hospital (which is shorthand for the entire system) as a healthcare provider – the council has no expertise and the Charter assigns this to the hospital board.
  • No action to benefit the city will be taken which can be foreseen to undermine the hospital’s financial or operational success – the suggestion that the council simply wants to get cash now, regardless of the impact on the hospital and the community is ludicrous.
  • The city values and wants to sustain a hospital in Northfield – in other words, it is important to have a high quality hospital in the city.
  • The city would like to understand more about the hospital, its operations, and strategic planning in order to make better informed decisions within its power as owner.
  • The city would like to develop a better framework for collaborating on decisions which impact both city government and the hospital.

Possible questions:

Basic, broad questions: what are the costs, benefits, and liabilities of owning a regional healthcare system?

Where do city/hospital needs, plans, missions intersect?  For instance:

  • what are the hospital’s infrastructure needs, are they considered in the city’s CIP, and how will costs be assessed?  The fringe location of the hospital increases these costs, so how do we plan for them effectively?
  • What does the city do which impacts public health and could benefit from participation (which could be informational, financial, etc.) by the hospital?
  • What development plans of the city impact the hospital or vice versa?  For example, could earlier conversations about the EMS facility have helped the council decide on a location for the public safety center sooner?  How does creating a public service cluster at that site guide future development?
  • How can the hospital participate in the city’s economic development efforts?  Healthcare has been identified as a target industry in the city’s economic development plan as has the more general objective of retaining existing businesses (and the hospital is one of our largest employers).

How can the city measure what matters about the hospital as it makes policy? In other words, how does the financial information figure in a larger picture of economic, environmental and social sustainability?  We’ve heard a lot about “quality of life” as a goal of city services, as something which attracts residents and businesses, and which contributes to our identity and well-being as a community.  In addition to being worth a lot of money, the hospital has great value for the city.  How does city ownership of the hospital increase the value?

IKEA as urban planner

IKEA's neighborhood planning plan

As an about-to-get married 20-something, I was glad IKEA opened its first US store in King of Prussia, PA, a short drive from my Philadelphia apartment.  We’ve been married 25 years and are still using the IKEA shelves we bought to replace our student cinder block and board constructions – we felt so grown up!  And IKEA has followed us across the country so we can still buy cheap candles, LACK tables, and BILLY bookcases.

But what about an IKEA neighborhood?  Jokes come to mind about all the houses coming flat-packed and assembled with those little hex-key tools with pieces not quite fitting, of course, but the idea is really quite interesting.

The project will redevelop 11 hectares (a bit more than 27 acres) in east London with 1200 all-rental housing units built following in typical (for Britain, anyway) rowhouses and flats for a variety of incomes and in a variety of sizes.  Busier edges of the development will have office/commercial space while IKEA will encourage such things as farmers’ markets and small local businesses. The whole shebang will be owned and managed by IKEA.  The Globe and Mail says IKEA is

not interested in a Disney-style kind of an animatronic spectacle. Rather, they’re seeding Strand East with evocations of spontaneous urban life in hopes that it will become spontaneous urban life; they say they’d be happy to see it shift and evolve to suit market conditions. It’s not clear, though, how this desire will coexist with Ikea’s desire to keep the place under its control.

Construction is planned for 2013.  Knowing IKEA’s philosophy of trying to use good design to solve problems and reduce costs as well as their good company logistics, the experiment seem like it should be efficient and can, perhaps, give municipal government some hints about how to operate.  I want to see what’s happened on my 50th anniversary.


Northfield’s greenbelt

New urban cow

“How to protect America’s countryside from sprawl” got my attention because of the word countryside – a very British term – and because it’s not the rural side of the boundary which gets the attention, usually, but the development pattern inside cities.  Still, the “how” in the article is really just a list:

There are strategies available for helping to maintain and strengthen rural landscapes and working lands, and slowing the loss of farms and farmers, forest and other resource lands…these can include “use value” taxation, purchase/transfer of development rights, assisting local farms with agricultural economic development such as direct farm-to-market programs, urban purchasing agreements, ecosystem services markets, right-to-farm laws and, crucially, extra low density zoning.  Promoting conservation easements can also be important.  Newly emerging strategies such as putting rural land to 21st-century nonpolluting uses with wind farms and biomass generation may also be promising in some areas.

To help with thinking about how we protect the countryside, we need to be able to express the value of open space, green infrastructure, agricultural land, and natural resources in economic terms and in measurable improvements to air quality, water quality, and, of course, quality of life.

Part of this, of course, is anticipating objections from the folks who don’t want to be told what to do with their private property.   If land was like an apartment building, where each parcel was completely separate from its neighbor with wall-like barriers at the property lines ensuring nothing would drift across into the neighboring property, then I’d agree.  I’d completely agree if each parcel was completely self-sufficient.  As it is, private property shares (and pays for) public resources like streets and pipes, as well as natural resources light, air, water, trees, etc.  Because we do share resources and share the financial burden  for them, I’d say we have to balance private property/public good to make our community as economically sustainable as possible.

Which is where I get back to the smart growth idea of knowing the value of open space to help create some additional incentive to increase density and put more taxpayers per acre (or foot of pipe) so we each pay less.  And I get back to England, too.

England, a country with many people but not much land – the UK is a bit smaller than Oregon but Oregon has about 3.8 million people and the UK has over 60 million – created greenbelts around major metropolitan areas in the 1950s (London’s greenbelt dates to the 1930s) to “stop urban sprawl and the merging of settlements, preserve the character of historic towns and encourage development to locate within existing built up areas.”  Now, facing a housing shortage (of millions of homes), England has been revisiting its greenbelt planning policy which has the potential to dramatically reshape the countryside.  I’m waiting to see what happens.

For Northfield, I think about the four townships surrounding the city as our de facto greenbelt, at least for now.  Waterford and Bridgewater townships have been clear about maintaining their rural character and perhaps we could help them do it because it would make good sense for the city, too.  As in Kaid Benfield‘s piece, the “how we do it” part is still undeveloped, so to speak.

Northfield, a resilient town

Ooh, what a nice little surprise in my Facebook newsfeed this morning – Strong Towns posted a link to their blog post about a recent conference on Back to Basics (of building strong, engaged communities) in Pine River, MN with this comment:  “Video from the Back to Basics Q&A, including Chuck Marohn expressing his affection for Northfield.”   Watch this video and hear Chuck tell everyone what a great place we have here.  Thanks, Chuck!