Developers,
consumers, and citizens view land-use decisions with different time horizons.
This fact
isn’t limited to land use either. If you
tell your four-year-old to eat her vegetables, you’re thinking about her being
a healthy adult twenty years from now.
She’s thinking about the “yucky” flavor in the next ten seconds. If you give a student detention, you’re
trying to teach values that’ll lead to a responsible adulthood. He’s thinking about missing the pickup
basketball game after school.
The same differences
apply to land use, although there are more people involved and the stakes have
a greater impact on the community.
For this
discussion, I’ll use the development of single-family homes. Similar analyses could be made of apartments,
retail, or office space. The time
horizons would be different, but the underlying lessons would be the same.
The
developer of a single-family home subdivision has a time horizon of perhaps
three to six years. (There are horror
stories of projects that involved multiple appeals and court cases, eventually
consuming decades. But let’s put those
aside as special cases.) Over those
three to six years, the developer must secure approvals, construct houses,
market homes, and close deals. After
those tasks are complete, he’s done. He
may never think about your community again.
The
developer isn’t evil for thinking in a three to six year window. He’s only responding to the imperatives of
the marketplace. He’s doing what he must
to meet the needs of his investors and his lenders. He’s doing what he must if he wants to remain
in business.
Homebuyers,
and their mortgage lenders, have slightly longer windows. Homeowners care that their investments retain,
and hopefully gain, value until they sell.
Mortgage lenders care that their mortgages are repaid.
Half of all
mortgages are repaid within seven years, which means that most new homes have
turned over after ten to twelve years.
So initial buyers and lenders have time horizons of ten to twelve years.
Where the
differing time horizons become really interesting are with the citizens. For this discussion, I’ll consider citizens
and the cities to be the same thing.
Some may look askance at the melding.
But cities are the collective will of its citizens, expressed through a
political process. If there sometimes
seems to be a disconnection, it’s because we don’t have a good political process
or because we have difficulty comprehending that the collective will is different
than our own beliefs.
(Let me offer
a clarification here. I often argue
against drivable suburban development, which some argue represents the
collective will of a community. But in
my disagreement, I don’t argue that drivable suburbia doesn’t represent the
will of the community. I argue that that
the collective will is wrong. And that
it’s my task to change that will, one mind at a time.)
So, what is
the time horizon of the city/citizens?
There are two. Some citizens will
look at the impact fees that are charged for new development, particularly if
those fees can be applied to fix infrastructure that is failing elsewhere in
the community. A focus on impact fees
has a time horizon of perhaps two years.
Other
citizens will look at the longer term functioning of their communities, which
includes the generation of sufficient tax revenue to maintain infrastructure
and the resilience to respond to the changes that the future will bring. That time horizon is at least fifty years with
a hundred years being a better guess.
That
dichotomy between a two-year horizon and a hundred-year horizon is key to
politics in many towns. Despite the
different ways in which the divide might be papered over, some politicians like
to argue about how the city will function over two years and others like to
argue the hundred year perspective.
There are
many arguments that can be made for either the two-year or the hundred-year
perspective. Personally, I’m a
hundred-year guy. I’d like my community
to thrive in the short-term, but care more about leaving a community that will
thrive in the long-term.
But I don’t
intend to offer the arguments for both sides, at least not in this post.
For today,
the message is only that developers are looking at perhaps five-year windows,
homeowners are looking at ten-year windows, and the community is split between
those who look at two-year windows and those who look at hundred-year windows.
There is no
magic solution to resolving the different time horizons. But understanding the differing perspectives
can at least provide a better basis for communication, from which good
compromises might flow.
As always,
your questions or comments will be appreciated.
Please comment below or email me.
And thanks for reading. - Dave Alden (davealden53@comcast.net)
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