Market Urbanism

Liberalizing cities | From the bottom up

“Market Urbanism” refers to the synthesis of classical liberal economics and ethics (market), with an appreciation of the urban way of life and its benefits to society (urbanism). We advocate for the emergence of bottom up solutions to urban issues, as opposed to ones imposed from the top down.

Mandates that fall only on multifamily development

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So I’m reading a PlanPhilly article about a proposal to mandate half-baths on the ground level and front doors without steps for new residential units (“visitability,” they call it), and while I don’t think that it’s a bright idea to begin with, this part struck me as particularly dumb, albeit very common (my emphasis):

There have been victories. Any homes that are built with money from the City’s Housing Trust Fund – money generated by fees charged for recording deeds – must be visitable. But, Salandra said, while bills that would have required all new housing to be visitable have been introduced to city council, they have gone nowhere.

The visitability task force is trying anew. Klein said that they submitted comments about the proposed new zoning code, asking for a change that any development of 10 houses or more require at least half to be visitable.

Unfortunately, I think that this restriction is just what they need to get this passed. Many burdens – some inscribed in law, but many wrung out in ad hoc negotiations between developers and local governments – are levied only on developers of more than a few units, which almost by definition includes everyone who builds dense housing. In some cases the cut-off is necessary due to the nature of concessions (what do affordable housing mandates mean to someone building a single house for themselves?), but this is definitely not the case here. If this is such a great idea, then why not enact it across the board?

The reason is obviously that it’s easier to foist restrictions on developers, who only have one vote each, than it is to go after the mighty suburban bloc. And while few voters know much about what they’re voting for anyway, the number of apartment-dwellers who see their interests as aligned with those of developers and their landlords is smaller still.

As for mandates, other than inclusionary zoning, that are only imposed on multifamily developments, the ones that come to mind are ad hoc demands of local governments for things like parking, school impact fees (essentially a cash bribe to the municipality), open space, and nearby public improvements. Does anybody know of any other burdens, either enshrined in law or not, that are only borne by those who build and live in multifamily units?

  • Allen

    Open space is commonly required for SFH home developments.

  • Daniel

    Federal Fair Housing law already requires multifamily buildings of four or more units to meet accessibility standards. This applies to all ground floor units in the building, and all units with elevator access. The regulation has been on the books since 1991, so unless Philadelphia is just hoping to use a different standard for visibility, I’m not sure how this suggestion isn’t just redundant.

  • Alon Levy

    In New York City, property taxes are higher on landlords (read: renters) than on homeowners who live in their dwellings.

  • In the form of setback requirements and such, yes, but I guess I was more talking about like, public park space. Obviously homeowners couldn’t easily provide this in kind (haha, imagine if the first five feet of everyone’s lawn were public…although I guess that kind of describes sidewalks…though many places don’t force homeowners [or developers, unfortunately] to build sidewalks), but they could be asked to pay into a fee to build a local park every few blocks or something.

  • Interesting…not surprising, but I did not know that was a law nationwide. The difference might be that “visitability” apparently applies to 50% of all units, not just groundfloor/elevator ones. Also, visitability seems to include having a half-bath on the first floor so your handicapped visitors can go to the bathroom (although this does little to help old people stay in their homes after they’ve lost mobility, unless they plan on taking only sponge baths), which is probably not a provision in federal law.

  • I did not know that! I feel silly for asking, but what exactly is the mechanism/tax break/credit?

  • In most places, owner occupied dwellings get taxed at a lower factor relative to commercially-owned multi-family.  I forget the technical term because I haven’t analyzed it latelely.  If my memory is right, in Chicago there’s a factor of 16 for commercial real estate, 12 for multi-family, and 9 for owner-occupied.  This factor (with others) is multiplied by the assessed value – a little complicated, and hardly transparent.

    I think I posted or commented on this way back when.  I’ll try to find it.

    Nonetheless, it also shows how much additional burden is put on neighborhood business relative to homeowners and even renters.  It’s another obstacle to vibrant, mixed uses…

    http://marketurbanism.com

  • Alon Levy

    The mechanism is that the property tax is assessed on only a portion of the unit’s value. The tax on small owner-occupied housing is 16% of 6% of the value; the tax on larger buildings is 12% of 45%. I’m vastly oversimplifying, but if you read Common Ground NYC’s explanation of the mess, you’ll know as much as I do. The basic rule is that richer groups pay lower taxes than poorer groups.

  • Anonymous

    All your rules need to be written into the law. Leaving things to ad hoc negotiation of exemptions raises construction costs (because the approval process jumps from a couple weeks to a couple years and most competition is shut out) and fuels the majority of all political corruption in those places that allow exemptions. It is much easier to get an exemption based upon friendship with the exemption giver or outright bribery than any legitimate means. Development in places that judge each project by individual “merits” is almost always the exclusive province of developers who know the decision makers. Outsiders are shut out, which reduces price competition. And when the feds go on their periodic anti-corruption sweeps, the indictments show that most of the corruption comes via real estate — because that’s where the money is — and that there’s dramatically less political corruption in those areas that apply the exact same rules to every would-be development and — when it becomes clear that a rule is counterproductive — change it for everyone rather than one favored developer.

  • Anonymous

    All your rules need to be written into the law. Leaving things to ad hoc negotiation of exemptions raises construction costs (because the approval process jumps from a couple weeks to a couple years and most competition is shut out) and fuels the majority of all political corruption in those places that allow exemptions. It is much easier to get an exemption based upon friendship with the exemption giver or outright bribery than any legitimate means. Development in places that judge each project by individual “merits” is almost always the exclusive province of developers who know the decision makers. Outsiders are shut out, which reduces price competition. And when the feds go on their periodic anti-corruption sweeps, the indictments show that most of the corruption comes via real estate — because that’s where the money is — and that there’s dramatically less political corruption in those areas that apply the exact same rules to every would-be development and — when it becomes clear that a rule is counterproductive — change it for everyone rather than one favored developer.

  • Anonymous

    All your rules need to be written into the law. Leaving things to ad hoc negotiation of exemptions raises construction costs (because the approval process jumps from a couple weeks to a couple years and most competition is shut out) and fuels the majority of all political corruption in those places that allow exemptions. It is much easier to get an exemption based upon friendship with the exemption giver or outright bribery than any legitimate means. Development in places that judge each project by individual “merits” is almost always the exclusive province of developers who know the decision makers. Outsiders are shut out, which reduces price competition. And when the feds go on their periodic anti-corruption sweeps, the indictments show that most of the corruption comes via real estate — because that’s where the money is — and that there’s dramatically less political corruption in those areas that apply the exact same rules to every would-be development and — when it becomes clear that a rule is counterproductive — change it for everyone rather than one favored developer.

  • Very true. I have an unrelated question, though: I saw that you may have tried to post this comment a few times before it actually came through…we’ve been having some trouble with the commenting system lately but I’m not exactly sure what’s wrong with it, so I was wondering if you could maybe tell me what exactly you did to get the comment to post properly that you didn’t do when it didn’t? It would be very much appreciated!

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