At Lincoln House January 2014

Confronting zombie subdivisions

Vast acres of approved but empty or incomplete subdivisions have become a blight on the landscape across the Intermountain West, compromising quality of life, diminishing fiscal health, and distorting real estate markets, according to new research published by the Lincoln Institute of Land Policy.

"Zombie subdivisions" - the living dead of the real estate market -can be reconfigured for more open space or turned over to other uses, but the far better policy is to prevent the phenomenon in the first place, say Jim Holway, Don Elliott, and Anna Trentadue, authors of Arrested Developments: Combating Zombie Subdivisions and Other Excess Entitlements, the Lincoln Institute's latest Policy Focus Report, available for free downloading. Key findings and case studies are also excerpted in the January issue of Land Lines.

The phenomenon as it has played out in Colorado in particular is examined in this coverage of the report in The Denver Post. The report was also covered by Planetizen, Places Journal, Utah Business, and The Next City.

The suburban equivalent of blight seen in such cities as Detroit, the incomplete subdivisions, in some cases all but abandoned following the 2007-2008 real estate bust, have left a landscape of roads to nowhere slicing through farmland, lonely lampposts and street signs, and "spec" houses standing alone amid marketing billboards and land cleared for nonexistent golf courses.

The researchers, analyzing eight states - Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, Utah, and Wyoming identified millions of "entitled" empty lots in subdivisions, where 15 percent to two-thirds of the developments were vacant. By region, they found that:

  • An estimated 1.3 million approved lots in the Phoenix-to-Tucson Sun Corridor remained unbuilt during the height of the bust.
  • In five Colorado counties as of 2012, nearly 30,000 subdivision lots are vacant, with an average of 20 percent of the approved land undeveloped.
  • In Teton County, Idaho, three out of every four lots entitled for development were vacant.

The incomplete developments - also known as "excess entitlements" that were granted by local governments, and some of which exist only on paper - are a burden on natural resources, hurt property values, and impose fiscal strains, requiring road maintenance, infrastructure, and obligatory emergency services coverage - all without contributing to the local tax base.

Very recently, regional rebounds in the housing markets have begun to chip away at what is clearly an oversupply, but demand is returning for areas closer to urban centers, rather than far-flung exurban areas. In many cases it would take years for the planned developments to be built out, if ever.

Economic forces shape the regional markets for land development and drive the boom and bust cycles. But local planning and development controls greatly influence.

The Lincoln Institute of Land Policy and the Sonoran Institute initiated the study to provide information and tools to help cities and counties struggling with distressed subdivisions. Drawing on case studies, lessons shared by experts during several workshops, survey results, and data analysis, the report identifies the challenges communities typically face when they attempt to address excess development entitlements - ranging from property rights to fragmented ownership.

The authors recommend several mechanisms to avoid future zombie subdivisions. Communities likely to face significant growth pressures would be well served by growth management policies that help to align new development entitlements and infrastructure investments with evolving market demands. For communities already facing problems stemming from distressed subdivisions, a willingness to reconsider past approvals and projects and to acknowledge problems is an essential ingredient for success.

At the state level, the researchers recommend the adoption of new state enabling authority to ensure local governments have the tools and guidance they need. At the local level, they recommend that governments prepare and revise community comprehensive plansand entitlement strategies; adopt enhanced procedures for development approvals and ensure policies are up to date and consistently applied; and rationalize development assurances to ensure they are practical, affordable, and enforceable, and establish mechanisms to ensure development pays its share of costs.

In addition, local governments should serve as a facilitatorand pursue public-private partnerships to forge creativeand sustainable solutions, build community capacity and maintain political will to sustain policy action, and establish systems for tracking development data to enable effective solutions, subdivision by subdivision, the report says.

Jim Holway FAICP is the director of Western Lands and Communities, the Lincoln Institute's joint program with the Sonoran Institute in Phoenix, Arizona. Don Elliott, FAICP is a land use lawyer, city planner, and a director at Clarion Associates in Denver, Colorado. Anna Trentadueis the staff attorney for Valley Advocates for Responsible Development in Driggs, Idaho.

Resilience by design

Senior fellow Armando Carbonell helped lead a wide-ranging discussion last week in Washington, D.C. on lessons learned from the recovery effort after Superstorm Sandy, and the federal role in helping metropolitan areas prepare for future impacts of climate change. The gathering was based around a Policy Focus Report to be published by the Lincoln Institute later this year.

Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development and key leader of President Obama's rebuilding-and-resilience initiative, addressed the gathering of local, state, and federal leaders, hosted by the Lincoln Institute and the Regional Plan Association.

"The 20 warmest years on record have all taken place since 1990," he said. "As I hear all over the country, those 100-year storms seem to be coming every few years now. Not just Katrina or Sandy, but record floods in Iowa or in Colorado, tragically, tornadoes within just a few months of each other in Oklahoma recently."

His comments appeared in a report published on Environment and Energy Publishing's Climate Wire, which also noted the formation this week of a Congressional climate action task force led by Sen. Barbara Boxer (D-Calif.) and Sen. Sheldon Whitehouse (D-R.I.).

The Policy Focus Report will be authored by Robert Parini and Laura Tolkoff from RPA. Also in attendance were representatives of the U.S. Army Corps of Engineers, the Federal Insurance & Mitigation Administration, the Council on Environmental Quality, and many other federal, state, and local agencies, as well as key non-governmental organizations, engaged in resilience and climate adaptation.

The goal was to bring together experts and stakeholders to discuss strategies for recovery and rebuilding and how they might be integrated with more long-range climate adaptation and resilience efforts, Carbonell said.

Hope for Promise Zones

President Obama's Promise Zones, blending tax incentives and public-private partnerships to spur economic development in struggling areas, hold promise as an anti-poverty initiative, says Lincoln Institute visiting fellow Andy Reschovsky. But for hard-hit Legacy Cities, it won't work overnight, Reschovsky says.

Obama announced he was designating the first promise zones in neighborhoods in Los Angeles, Philadelphia and San Antonio as well as swaths of southeastern Kentucky's coal country and the Choctaw Nation of Oklahoma. The announcement comes as Washington marks the 50th anniversary this week of President Lyndon Johnson launching his War on Poverty, and amid growing concern about income disparity and equity.

Reschovsky, a tax expert and professor emeritus at the University of Wisconsin at Madison, is quoted in a story on the subject in USA Today.

Odds & Ends

The Lincoln Institute will have a major presence at the New Partners for Smart Growth conference in Denver next month, with sessions on Legacy Cities, Zombie Subdivisions, and open-source Scenario Planning Tools ... How the MOOC might change the design of the college campus ... The Sonoran Institute is celebrating its fourth year offering SCOTie , the online toolkit designed to aid Western communities in planning ... Little-noticed public buildings like recycling facilities and ambulance dispatch centers are getting new attention ... The next webinar in the series sponsored by the World Bank with the Lincoln Institute, Grant Financing of Metropolitan Areas: Principles and Practices, is set for January 28 ... The Institute without Boundaries in Toronto, Canada is calling for expressions of interest for its connecting-divided-places project ... A San Francisco shout-out to Henry George ... This month's highlighted working paper: The Fiscal Health of U.S. Cities by Howard Chernick and Andrew Reschovsky.

— ANTHONY FLINT, Lincoln Institute of Land Policy

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