Governance and Opportunity in Metropolitan America (1999) / Chapter Skim
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Does the American Way of Zoning Cause the Suburbs of Metropolitan Areas to Be Too Spread Out?
Does the American Way of Zoning Cause the Suburbs of Metropolitan Areas to Be Too Spread Out?
Pages 149-191
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PART 11 In-Depth
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This paper is organized as follows. In the next section, I treat the issue of income segregation.
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were comparable to that of the average suburb. Although exodus from central cities contributes to suburbanization, it does not necessarily cause the suburbs to develop at excessively low density.
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Housing in central cities was largely constructed for those who in the past were middle- or high-income people. As American incomes generally rose over time, this older housing no longer met the demands of upper-middle-income families.
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Houston's suburban development occurs in homogeneous planned communities that are governed by private covenants whose restrictions would be the (unexpressed) envy of the most exclusive municipal planning board (Peiser, 1981~.
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Once a community was certified as having a proportion of new housing that satisfied its "fair share" of low-income housing, it was virtually invited by the New Jersey court to be as exclusive with the rest of its undeveloped land as it wanted to be: "Finally, once a community has satisfied its fair share obligation, the Mount Laurel Doctrine will not restrict other measures, including large-lot and open area zoning, that would maintain its beauty and communal character"~456 A.2d at 421~. The incentives for the suburbs then became to switch from selective exclusion of the poor to general exclusion of everyone (Fischer, 1991~.
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The first bit of evidence is that high-income communities almost invariably have more restrictive zoning regulations than others. They impose more stringent regulations on undeveloped land than those that apply to existing, built-up neighborhoods.
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found that even under "ideal" conditions for spontaneous income segregation, at least a weak form of zoning for minimum lot size was necessary to obtain such stratification. Without fiscal zoning, developers have a strong incentive to build lower-cost housing in affluent districts to take advantage of the higher-quality services and lower tax rates.
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Crime rates in nearly all large central cities have been falling rapidly in the last few years to levels that are nearly those of the 1960s (New York Times, December 20, 1996, p.
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One asks whether American central cities are being depopulated for reasons besides otherwise benign and probably unstoppable economic trends and technological changes. The second asks whether the population density of suburbs is artificially low.
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His method was to estimate metropolitan household location patterns for 1950 and then project 1980 incomes onto this pattern to see how many more households would have lived outside central cities with the higher incomes. His point estimate of how much suburban growth was accounted for by rising incomes was 43 percent (1992:301~.
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As I suggested at the outset of this essay, however, it is logically possible that the suburban development that results from an exodus from central cities could still be highly compact. It is evident from informal observation of privately developed "planned communities" such as Reston, Virginia; Columbia, Maryland; and Foster City, California, that suburbanites are willing to live in relatively highdensity communities as long as they get good public amenities, especially safety.
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prescription. THE POLITICAL DYNAMICS OF ZONING CREATE SUBURBAN SPRAWL The peculiar fact of American metropolitan areas is that many suburbs that are quite close to downtown have preserved large amounts of undeveloped, open space, and most of their residential development has been at relatively low densities.
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, there are scores if not hundreds of independent local governments surrounding central cities (Fischel,1981~. Developers who are frustrated by regulations in one municipality can skip to another.
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This change occurs well before the municipality itself is filled up in any meaningful sense. There is much undeveloped land left, and the new majority changes the zoning, usually by stages, to see to it that it will remain undeveloped or developed at far lower densities than the tracts in which they themselves live (Pyle, 1985:43~.
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Most courts defer to the decisions of local government as long as there is some apparent public benefit from the regulation and as long as the landowner has some residuum of value left in the affected parcel. The eyes of the courts are almost always trained on the broadly conceived benefits of the regulation to the community, not on the financial opportunity cost of the regulation to the owner of undeveloped land.
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But it would be remiss of me not to note that regulatory takings have so far barely rumpled the fabric of local land use regulation. By far the greater source of difference between the United States and Europe is that American regulations emerge from more or less autonomous local governments (Cullingworth, 1993~.
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In response to the observation that such zoning has been around a long time, so that most current suburban residents have already paid for their exclusivity, I would observe that any status quo, no matter how undesirable, can be capitalized in housing prices. For example, unfair property tax assessments that assess new homebuyers more than long-time residents, are clearly capitalized into property values, thus seeming to equalize total payments from housing and taxes (Yinger et al., 1988:135; Do and Sirmans, 1994~.
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Competent urban economists mention this repeatedly, but it seems contrary to economic reasoning. It is not the amount of undeveloped land that constrains the outer development of cities, but the price of land.
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The problem is with the land that is left open as either excess lot size or entirely undeveloped land. Many of the arguments against urban sprawl take the view that the only cure is to develop multifamily housing.
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, goes like this. Owners of undeveloped land in the suburbs often decline to develop it, even when there is a bona fide builder at hand.
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Perhaps the strongest evidence that zoning, not the behavior of speculators, causes low density comes from studies of land values. If undeveloped land that has been bypassed by development were simply being held by speculators, its current market value would be nearly equal to that of already-developed land.
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The direction in school finance reform since 1970 has been to reduce reliance on local property taxes (Bahl et al., 1990~. To the extent that this is successful, the fiscal motives for excluding low-income housing from communities should diminish (Schill, 1991:851~.
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Although I think the wellspring of low-density zoning is the preferences of suburban voters, their ability to control large areas of undeveloped land is sometimes limited by political considerations and occasional judicial hostility to multiacre minimum lot size. Federal government environmental regulations (often administered by parallel state programs)
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Most proindustry local governments, with the exception of depressed central cities, have their eyes trained on fiscal benefits. Another manifestation of the inclusionary effect of size is that big cities tend to be less exclusionary in their zoning than their suburbs (Clingemeyer, 1993; Linneman and Summers, 1990:22~.
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In a sense, the unrealistically high-density development plans are as exclusionary as unrealistically low-density development, since both make accessible but undeveloped land off limits to normal suburban development. Similar situations of
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, and Reading, England (Cheshire and Sheppard, 1989~. The alternative to metropolitan government as a means of including the demands of outsiders is to restore the development rights of owners of undeveloped land and owners of land ripe for redevelopment (Fischer, 1985:175; 1995:351~.
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Suburban zoning laws regulate the market in part because the market would give existing suburbs more poor people than current residents would like. The owner of undeveloped land, however, does not care whether the high bidder for her 10acre tract proposes to put up 2 mansions or 40 bungalows.
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For this reason, many judges who are in fact offended by the unfair treatment of owners of undeveloped land are reluctant to intervene, except in the most egregious cases. This reluctance is gradually changing, however, with the rise of the regulatory takings doctrine and the realization that development-minded landowners are not the social parasites they have often been made out to be.
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The problem with substantive review is how to set the appropriate standards. If 4-acre minimum lot sizes are unconstitutional, as was decided by the Pennsylvania supreme court in 1965 (Coyle, 1993:54)
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This essay has argued that the major cause of both of these problems is the attenuation of market forces by local land use regulation. Demands by outsiders are systematically thwarted by local governments in suburban areas that seek to preserve the status quo.
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: 1- 115. Brownstone, David, and Arthur DeVany 1991 Zoning, returns to scale, and the value of undeveloped land.
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Sirmans 1994 Residential property tax capitalization: Discount rate evidence from California. National Tax Journal 57(June)
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1977 Suburban growth controls: An economic and legal analysis. Yale Law Journal 86(January)
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Gilhool 1964 The constitutionality of imposing increased community costs on new suburban residents through subdivision exactions. Yale Law Journal 73(June)
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1985 The price effects of urban growth boundaries in metropolitan Portland, Oregon. Land Economics 61(February)
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1969 The effects of property taxes and local public spending on property values: An empirical study of tax capitalization and the Tiebout hypothesis. Journal of Political Economy 77(November)
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Stengle 1995 A measured step to protect private property rights. Florida State University Law Review 23(Fall)
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1988 The market effects of zoning undeveloped land: Does zoning follow the market? Journal of Urban Economics 23(May)
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Ladd 1988 Property Taxes and Housing Values: The Theory and Estimation of Intrajurisdictional Property Tax Capitalization. Boston: Academic Press.
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