Monthly Archives: November 2013

LACMTA Rail Ridership Update – October 2013

Longer, more interesting posts still in progress (I promise), but in the meantime, a quick look at performance of the rail network since January 2009 (the earliest year for which monthly data is published on Metro’s website).

First, the raw data:

rawdata-201310

Red/Purple, Gold, & Expo are all near all-time high ridership. Blue & Green are a little weak relative to late 2012. The data there is questionable – I find it hard to believe the Blue Line gained 6,000 riders per day in June 2012, another 4,000 per day by November 2012, and then lost 5,000 per day by January 2013 – but it is what it is, we have nothing else to go on.

Monthly data really is too noisy to see patterns:

wkdy-201310

You have to look at a rolling 12-month average to really see what’s going on. Call it seasonally adjusted:

wkdy-12mo-201310

Blue, Green, and Gold surged a little through 2011 and 2012, but have tailed off a little lately. Red/Purple Lines have been increasing steadily.

A better way to look at the productivity of the lines is boardings per mile, and as you can see, Expo Line has been kicking ass and taking names. After 18 months in service, it’s closing in on the boardings per mile achieved by the Blue Line after 18 years.

wkdy-bpm-201310

Consider that Expo Phase 2 is only 6.5 miles long, and it’s going to serve:

  • Palms (one of LA’s densest neighborhoods)
  • Expo/Westwood (sneaky close to Pico and a natural transfer point to get to UCLA)
  • Sepulveda/Pico
  • Olympic/Bundy
  • Olympic/26th (Santa Monica’s booming tech area)
  • Colorado/17th
  • 3rd St Promenade, Santa Monica Pier, and the beach

I’m going to make a prediction and say that Expo Line passes the current Blue Line boardings per mile (4,000) within three years of Phase 2 opening. Reason, your crow is served.

When Does More Expensive Construction Make Sense?

One of the most common criticisms of things like Portland’s Urban Growth Boundary is that they increase housing costs. This is undeniably true, at least on a per SF basis, because denser construction costs more. While prowling around Save Marinwood and Quiet and Safe San Rafael, I found a presentation by John Burns that gives relative costs of construction: about $60/SF for SFR, about $90/SF for garden apartments, and about $200/SF for podium construction. While you might be able to save on transportation costs by living closer to your job, in general the tradeoff you make is accepting a smaller dwelling in exchange for living in a more desirable area.

Still, even with no urban growth boundary to speak of, at some point, agglomeration effects cause prices to rise to the point where more expensive types of construction make sense. See, for example, Los Angeles. When does that happen?

As part of trying to keep track of larger trends, I’ve started following the suburban development homes being offered by the major builders. Partly, this is because others (like Curbed) are already keeping good tabs on development in LA and Orange County. But also, urban redevelopment projects tend to be more unique, depending on the specific developer goals, location, land costs, difficulty of permitting, and so on. In the suburbs, we can look at projects in different communities by the same developer, which makes it easier to compare costs across communities, or we can look at projects in the same community by different developers, which makes it easier to compare developers.

D.R. Horton is a major builder in the region, as of early November it had 25 developments in progress in LA, Orange, San Bernardino, Riverside, and Imperial Counties. Of these, 14 were in Riverside County, highlighting the uneven nature of the recovery. D.R. Horton’s most affordable properties, in Adelanto and Imperial, are selling for about $100/SF, around 165% of construction costs.

Therefore, assuming that zoning allows for it, and market conditions and regulation don’t favor buying over renting, that means garden apartments become economic when prices hit about $150/SF, and podiums when prices hit about $330/SF.

The threshold for garden apartments is pretty low; based on D.R. Horton’s SFR pricing, they already make sense in places like Fontana and Murrieta. Podium construction has a higher threshold; Santa Clarita is getting close, and LA and Orange County pencil out. Note that this is a gross simplification. Small (1-2 person) households often don’t want dwellings as large as SFRs. In a place like Adelanto, a lot of single people could be accommodated in things like garage apartments, let rooms, and so on, if permitted. At small sizes, prices don’t scale linearly because of fixed costs like bathrooms and kitchens, which are more expensive per SF than bedrooms or living rooms.

However crude it is, this analysis is consistent with the expectation that there is a logical progression of densities as you approach more desirable areas: SFRs to garden apartments to podiums.

I should point out that by this logic, high-rise construction doesn’t make sense until prices go above about $700/SF – a level that almost nowhere in Los Angeles has reached. Not to beat a dead horse, but I feel compelled to again emphasize that the debate is not about the aesthetics of mid-rise versus high-rise construction. It is affordability versus unaffordability. If your vision is high-rises instead of mid-rises, your vision is an unaffordable Los Angeles. There’s no two ways about it.

Podiums Are the New Dingbats

Apologies for light posting lately; hopefully things will be back to normal soon. I’m working on some longer items, but in the meantime, just a quick post to build on a few things I’ve written about before.

Last weekend, I checked out some new apartments that were opened a few months ago at the corner of Palms and Motor. They’re renting for about $2.50-$3.00/SF, with the cheapest 1BR checking in at $1,775. That’s not exactly cheap, but it isn’t terrible for new construction, especially considering that the building must have had higher construction costs due to building a couple levels of parking. With new true podiums nearby on Motor and Palms coming online soon, we’ll see how they’re priced. I’m paying much less, but I’m in a considerably older building.

Dingbats were the prototypical affordable housing in built-up areas of LA. They feature efficient parking design, with parking tucked underneath on a lower level, and the wood-frame apartments above. However, the open nature of the lower level means it has less shear strength, so if a big earthquake hits my apartment might be going for a short but spicy ride that ends on top of those cars. To avoid this design flaw, you need to beef up the performance of the lower level, which usually means podium style construction: reinforced concrete columns and deck for the lower level, wood-frame construction above.

Once you’ve triggered the expense of  concrete construction on the lower level, you might as well go as tall as you can with the wood-frame above, to  distribute the costs of the high-cost portion over more units. That’s generally about five or six stories, provided the zoning allow you to do so and you can meet the parking requirements with only one level. In other words, podiums are the new dingbats – the best way to max out a site with low-cost housing.

Of course, if you can avoid the need for the podium through something like reduced parking requirements, you can keep housing costs even lower.

Call Me Mulholland

Warning: this is a long, subjective post, and might be a waste of your time. If you’re looking for real analysis, maybe just sit this one out.

Today is the 100th Anniversary of the dedication of the Los Angeles Aqueduct. Conceived of and designed by William Mulholland, the aqueduct (along with the southern transcontinental railroads and the ports) is one of the definitive pieces of LA infrastructure. The city simply would not exist the way it does today without the aqueduct.

So, in celebration of the aqueduct, let’s take a look at LA’s existing water sources, conservation efforts, and potential expansions.

Los Angeles Aqueduct (Owens Valley and Mono Basin)

The genius of the LA Aqueduct is its simplicity. Water from snowmelt in the East Sierra used to run into the Owens River and then into Owens Lake, an endorheic lake south of Lone Pine. Mulholland realized that the river could be diverted to flow, by gravity, to the San Fernando Valley using nothing but ditches, siphons, inverted siphons, and the like. Thus, the LA Aqueduct is one of LA’s best sources of water in terms of carbon footprint, since there is no need to pump the water to get it to the city. However, the diversion of the river resulted in the desiccation of Owens Lake.

Later, the city extended the system north to the Mono Basin using tunnels to get through the volcanic rocks that separate the basin from the Owens Valley, and constructed Lake Crowley for water storage and flood control. The diversion of the creeks feeding Mono Lake caused the water level in the lake to begin to fall, and it appeared that Mono Lake might suffer the same fate as Owens Lake. The formation of the Mono Lake Committee in 1978, resulting in lawsuits that were finally settled in 1994, spared Mono Lake from following in the footsteps of its larger, fresher neighbor to the south. As a result, today very little of LA’s water comes from the Mono Basin; at the time of this writing, the lake elevation is 6380.1’, still short of the target elevation of 6392’.

The city’s water sources in the Owens Valley have also come under pressure, due to demands for dust control from the Great Basin Air Quality Board (GBAQB). The dry lake bed is a significant source of dust, though certainly not the only one in a dry desert valley. Counterintuitively, dust is a problem because the water table remains close to the surface, which encourages salts and small particulate matter to migrate upwards to the surface, where they are picked up by the wind. GBAQB and LADWP have decided to address the dust problem by “rewatering” the lake bed, using a complex and expensive scheme of pumps and distributary equipment. This treatment is using almost half of the annual water volume that the aqueduct is capable of delivering.

I have a much dimmer view of the Owens Lake project than the Mono Lake controls. At the time the Mono Lake Committee was formed, the impacts to the lake ecosystem were just reaching a significant point. Much worse impacts to the brine shrimp and nesting birds were avoided by stabilizing and increasing the lake level. The city was able to adjust to the reduced flows with conservation efforts.

In contrast, Owens Lake has been dry for decades. Diverting water to the lake bed does not preserve lake ecosystems, because they are long gone. The salty environment is hard on pumping equipment, and rewatering is not the most cost-effective way to control dust on the lake bed. In fact, a cost-benefit analysis would likely show that almost any dust control measure does not make sense given that the primary beneficiaries are the 66 remaining residents of Keeler – a third of whom are over age 65, and 83% of whom are over age 45. Buying them out and focusing on dust control measures for times when the winds blow from the east (which is less common, prevailing winds are from the west) to mitigate dust generated by the lake in Lone Pine, Olancha, and Cartago (combined population about 2,500) would be much more logical.

The problem is that the Owens Lake project isn’t really about environmental benefits or controlling dust, it’s about settling old scores between the Owens Valley and Los Angeles. Residents of the valley are convinced that Los Angeles “stole” their water (I use scare quotes because the city bought the water rights). Grudges last for a long time, especially water grudges in the West, and depriving the city of water through legal mechanisms makes up for not being able to deprive the city of water by dynamiting the aqueduct. Meanwhile, the fate of other desert lakes in the West suggests that if the lake hadn’t been drained by Los Angeles, it would have been drained by agricultural interests.

Letting water and money needlessly vanish in the scorching Owens Valley sun is bad enough, but the Owens Lake project has significant negative effects on other parts of the system. It’s forced LADWP to increase water purchases from the Metropolitan Water District (MWD) via the Colorado River Aqueduct and the State Water Project (SWP) via the California Aqueduct. This results in using water sources that consume energy in being pumped over mountains on their way to Los Angeles, and creates needless conflict with other MWD and Colorado River users and with agricultural interests in the Central Valley.

The Owens Lake project needs to be completely reassessed. There is no point in wasting that water and throwing good money after bad. Remediation efforts should be based on achieving efficient results starting from present conditions, not wistful nostalgia and guilt for what happened in the past.

Colorado River Aqueduct

Mulholland was gone, ruined by the failure of the San Francisquito Canyon Dam in 1928, but the Colorado River Aqueduct was his conception too. Like the LA Aqueduct before, it caused some ill will with the locals in Arizona, who thought they should get the water. Phoenix and Tucson did get their water, eventually, with the completion of the Granite Reef Aqueduct, but in water law in the West, being first to the well counts for just about everything. Arizona’s and Nevada’s claims are now subservient to California’s, which means if the Bureau of Reclamation (USBR) is short of water, their deliveries will be cut first. Before rapid growth in places like Las Vegas and Phoenix, this wasn’t an issue, because Nevada and Arizona weren’t using their full allotments. But the day of reckoning is fast approaching; barring an above average snowpack this winter, cuts will be forthcoming in 2014 or 2015.

California’s share of water has been under pressure, too, from growth in places like San Diego. Unlike the LA Basin and IE, which at least have the LA Aqueduct and SWP, San Diego has no connection to water outside the MWD. Recently, this has led to the Imperial Valley selling some of its water to San Diego. Agricultural output can be maintained by switching to crops and varieties that use less water, and using more efficient irrigation systems.

Normally, that’s an all-around win, but in a twist of fate, agricultural runoff is the only thing maintaining the level of the Salton Sea. Troubled though it is, the Salton Sea is used by wildlife, and it can’t be allowed to dry up. If it were to dry, the pollution in the runoff that has accumulated would become airborne – making the problems at Owens Lake look small in comparison. The Salton Sea Authority was created to try to address this issue, but the money to execute their plan isn’t there yet. This might be a case where value capture is applicable – if you keep the sea from drying out, you really are adding value. Stabilizing the water level would also make lakefront property much more valuable; since the lake has no outlet, it is subject to considerable rises and falls in surface elevation as precipitation varies.

Really, the Colorado River is just about tapped out. Practically no users have surplus water. Las Vegas is so nervous about its sole water supply that it’s constructing a new intake from Lake Mead (lower than existing intakes, so that it will remain operable if lake levels drop) and building a pipeline hundreds of miles north into the Nevada desert to tap the meager water resources of the Basin and Range. There’s no water to be had here. California is lucky enough to have other sources. Arizona and Nevada will just have to adapt.

State Water Project

I have to say, as an engineer, the SWP is just waaay cool. Cruising up some world class highway engineering on the 5 through the Central Valley, looking out over endless farms and the gentle contours of the California Aqueduct and the Delta-Mendota Canal – that’s up there with kicking back on a whisper-soft high speed rail ride or hopping the world’s largest subway system, which didn’t even exist 20 years ago. Wait, sorry, engineering fantasies – what was I talking about?

The basic premise of the SWP is that water from the Feather River is stored at Oroville Dam, 450 miles north of LA. The water makes its way south via the Sacramento River, the Sacramento-San Joaquin Delta, and the California Aqueduct. Much of the water goes to irrigation in the Central Valley, but the aqueduct extends as far as Santa Barbara County (Coastal Branch), Castaic (West Branch), and Perris (East Branch). Water agencies as far away as Palm Springs participate in the SWP even though they have no direct connection (they swap MWD water for SWP water with agencies that connect to both). The SWP, along with the USBR’s  Central Valley Project (CVP), is what makes the Central Valley an agricultural powerhouse.

Like many of California’s water supplies, SWP deliveries have come under pressure as a result of some dry winters, increased demand, and environmental concerns. In this case, the victim is the delta smelt, which lives in the Sacramento-San Joaquin Delta. During dry years, low water flows in the delta result in the SWP and CVP pumps on the south side of the delta creating unusual currents, which appear to be correlated with declines in fish populations. Again, I’m generally in favor of trying to preserve threatened ecosystems like these (as opposed to environmental vanity projects like rewatering the long-dry lower San Joaquin River).

When there’s insufficient water to meet all SWP demands, someone’s deliveries have to be cut, which often means less water is available for agriculture in the Central Valley. Some water can be stored in the San Luis Reservoir (the largest off-line reservoir in the US) and some can be supplemented by groundwater pumping. Long-term reliance on groundwater pumping risks drawing down the aquifer, though evidence suggests that unlike the Ogallala Aquifer, there is some recovery of Central Valley aquifers during wet years.

Agricultural interests in the Central Valley (and Imperial Valley, for that matter) seem to get little sympathy in the state’s more urban areas, maybe because environmentalists tend to view irrigated agriculture unfavorably. In my opinion, this is unfortunate: lower agricultural output means significant hardship for some of the state’s most vulnerable workers. Much of the state’s irrigated acreage (the Sacramento Valley, Friant-Kern Canal, eastern San Joaquin Valley, and Imperial Valley) is irrigated by gravity, requiring little energy to operate. The projects that do require pumping (SWP, Delta-Mendota Canal) aren’t that bad since the Central Valley is pretty flat – the big energy requirements on the SWP come in to get the water over the Tehachapi Mountains, which is for urban users in Southern California.

The ability to use reservoir and groundwater storage to smooth out wet and dry years is a major advantage of California agriculture, which can stand up to droughts that ruin crops in the Great Plains and eastern US. The moderate California climate means crops aren’t subject to damaging freezing temperatures like other places. Hopefully, we can manage our water resources to maintain the competitive advantages of California farming.

Local Groundwater and Conservation Efforts

I won’t say much about efforts to develop local groundwater resources and promote conservation in the LA area other than to say I’m in favor of it. These efforts ease pressure on outside sources, and increasing the number of sources provides some system resiliency, e.g. if the East Sierra is having a banner snow year, we could use groundwater storage to save up some water for dry years.

Channeling My Inner Mulholland

Ultimately, this would be a pretty boring post if all I did was recap our existing water sources with a little commentary thrown in, and at 2,100 words, maybe you’ve already tl;dr’d it. But if you’re still with me, here’s two other potential water sources we could tap.

I don’t know if the finances would pencil out, but they would add a couple resources that could be used to take pressure off of existing resources. The goal would be to develop the resources with a minimum environmental impact, and blend sources every year so that no one resource is overused. The obvious issue is that once you’ve paid to build the infrastructure, the temptation is there to max out everything, and then when a drought hits, you’re screwed. So hey, maybe we build these, call it SWP2, turn everything west of Lancaster into another Imperial Valley, and go down in a blaze of glory when a long drought hits like so many desert irrigation civilizations before us. I propose, you decide.

Walker River

The East Fork of the Walker River is the logical last gasp in the East Sierra, just north of the Mono Basin. The headwater streams of the river pass pretty close to Conway Summit, which separates the Walker Basin from the Mono Basin. For the price of a short tunnel under the summit, you could build a diversion ditch to send some of that flow southeast to the Mono Basin. The West Fork of the Walker River is too far away, and the intervening terrain too mountainous, to make it practical to try to get anything out of that basin.

The terminus of the Walker River, Walker Lake, is not without its own issues due to local water diversions, and Nevada probably wouldn’t take too kindly to California trying to buy up all the water rights. This option would probably be a long shot, but maybe you could pitch it as a flood year only diversion. Precipitation in the Sierra can be irregular, and very heavy during El Nino years; the West Branch of the Walker River flooded badly in 1995, destroying parts of the 395. There could be a threshold snow water content for the snowpack that would allow some diversion during heavy snow years, and prevent flooding downstream on the Walker. The diversion ditch could connect into the Mono Basin Project pretty easily, thereby conveying the flow to Lake Crowley.

Delta Peripheral Canal and Northwestern California Rivers

The Delta Peripheral Canal was first contemplated as an actual canal during Jerry Brown’s first stint as governor; now, it’s been reconceived as a pair of bored tunnels to reduce environmental impacts to the delta, which makes canal a pretty significant misnomer. The point of the canal is to allow diversions from the Sacramento River to the SWP and CVP without creating the oddball delta currents that cause such issues for wildlife in the area. This would alleviate the need to cut water deliveries to Southern California.

But once you’ve got that conveyance, well, you might as well see what other water you could move with it, right? The clear prize would be the Eel River, where an enormous dam called Dos Rios was once proposed, which would have created the largest reservoir in California and sent water to the Central Valley via a tunnel. That contentious project was canceled by none other than conservative patron saint Ronald Reagan (so, if you’re keeping score, Democrat Pat Brown built the SWP, Democrat Jerry Brown is trying to build the Delta Peripheral Canal, and Republican Ronald Reagan screwed over big business in the Central Valley by canceling a dam. Just sayin’).

Again, if any sort of project were to take shape, I’d hope it could be done with much less environmental impact than Dos Rios. The Eel River flooded severely in 1964, so again, maybe a system could be set up that would only be activated during flooding events, though I don’t know how practical that would be. On the other hand, maybe you just build Dos Rios and call the lake the David Brower Reservoir, because you gotta have a sense of humor about these things.

The Limits of O’Toole-onomics

Update: Randal O’Toole was kind enough to respond via email. I’ve updated the post to reflect those corrections, and added his full comment and my reply at the bottom of the post.

This thought has been kicking around in my head for a while, but this Next City – The Works post by Stephen J. Smith on commute times in cities finally motivated to me to hash it out.

It’s long been noted that, super commuters aside, human beings tend to have a fairly constant travel time budget. This means that increases in the average speeds of transportation facilities often result in people traveling further distances in the same amount of time, rather than the same distances in less time. It also means that, given an average speed for a mode of transportation, there’s a practical limit to the size of city you can serve primarily with that mode.

For example, in a rural town that predates cars, you can access everything in the town by walking. No matter where you are, nothing would be more than a mile or two away. People might bike or drive to save time out of convenience or to avoid unpleasant weather, but functionally, the town can work without cars. For example, if you’re in Lone Pine, you can get to anything else in Lone Pine just by walking.

Biking expands your reach, and in a small city – say the size of Merced or Santa Maria, maybe even Santa Barbara or Ventura – could provide you access to everything the city has to offer. Now, maybe bicycle facilities in some of those places are sadly lacking, but that doesn’t mean the concept is technically unsound. We could make it work if we wanted to.

If your city gets much bigger than that, though, you need some type of higher speed transportation. There are many possible combinations that work. For example, New York and Boston provide rapid transit to move you quickly across parts of the city, depending on you to walk the last bits of your trip. Places with huge bike usage, like Amsterdam and Copenhagen, provide transit and plenty of bike parking. Phoenix and Houston give you freeways and craploads of car parking. Ignoring environmental, aesthetic, and efficiency concerns, the only requirement is that you increase the amount of distance people can cover in the same amount of time.

In very large metro areas, it’s hard for even freeways and rapid transit to overcome the distances, and as a result, new nodes of development start to spring up – places like Irvine and Tysons Corner – to keep commuting times down to what people will tolerate. And in fact, despite the perception of Orange County as a suburb of LA, 85% of people who live there work there as well. Cross county flows are about the same in each direction – 180,000 live in Orange County and work in LA County, with a similar number doing the opposite.

Okay, we have the technology to build lots of freeways, transit, whatever – so why don’t metro areas just sprawl out into infinity to keep land costs down? Well, working in opposition to things that tend to decentralize cities, like quality transportation and communications, we have agglomeration economies. Basically, people and businesses want to be located as close as possible to the people and businesses that they interact with. If you want to start a movie studio, it makes sense to do it in Los Angeles, where there are lots of people you need like actors, grips, gaffers, show runners, and so on. If you know how to write smartphone apps, it makes sense for you to move a place like San Francisco where there are lots of jobs for people with that skill.

And that brings us to today’s question: what is Randal O’Toole’s answer for a place like Los Angeles, that has grown out to the practical limits of presently available transportation technologies?

First, let me define what I see as the essential points of the Randal O’Toole plan:

  • Public transit can’t compete with the car in modern cities. It’s cheaper to build more roads and use things like congestion pricing. Bus transit is cheaper than rail transit.
  • Centralized land use planning is inherently less efficient than the free market.
  • Things like urban growth boundaries drive up the cost of housing by limiting the amount of developable land and forcing multi-family construction that is more expensive per square foot than single-family residential (SFR).

For the sake of argument, let’s accept these points. In this framework, places like the Bay Area and Portland are unquestionably making bad decisions that will cost a lot of money, hurt their economies, and make the regions less affordable.

And hey, he’s got a point. Throwing open West Marin and all of Clackamas County to master planned suburban development like Clark County would enable you to build a lot of housing relatively close to the centers of San Francisco and Portland. You might not like the idea of the Golden Gate National Recreation Area turning into Daly City, but technically, it would work. In his critique of Plan Bay Area (PBA), O’Toole calculates that currently, 21% of the land area is developed, and by increasing it to 44%, growth could be accommodated by SFR development. Again, that might seem like an unacceptable change to a lot of people in the Bay Area – including, ironically, a lot of the NIMBYs who cited O’Toole’s analysis when fighting PBA – but it would work.

But what about LA?

Other than Ventura County, LA doesn’t have any urban growth boundaries. The developable areas that are protected – the Santa Monica Mountains, the Chino Hills, the San Joaquin Hills – are small in the scheme of the region, and would end up being luxury housing anyway. The boundaries we’re pushing up against, like the San Gabriel Mountains, have topography that is simply too insane for development on a meaningful scale, along with having challenges like insufficient water supply.

Meanwhile, on the fringes of the LA region, the suburban development machine is coming back to life in places like Temecula, Beaumont, and Rialto, and the folks up in the Antelope Valley and the Victor Valley are waiting for their turn. They don’t have any urban growth boundaries, and they’re eager to see your subdivision or industrial park get up off the mat and start growing again. Their problem isn’t controls on land use, it’s slow growth in manufacturing, construction, trade, and logistics.

You know what could help those industries? More construction in the Los Angeles Basin. The parts of the LA economy that are doing well are centered in places like the Westside, and due to agglomeration effects, they want to expand on the Westside, not in Palmdale. But the places where suburban development is happening – Porter Ranch, Santa Clarita – are really far from the Westside. Housing isn’t expensive on the Westside because land use controls are preventing construction of SFRs; the problem is that the undeveloped land where you can build SFRs for under $200k is 90 miles away in Beaumont. What we need is construction of more apartment buildings on the Westside, construction that would almost certainly happen if it wasn’t prohibited by zoning laws and discouraged by onerous permitting requirements.*

To his credit, O’Toole is generally against zoning restrictions as a form of central planning. But his substitute, deed covenants, is even worse. Zoning, at least, can be changed by democratically elected officials, for better or worse. A homeowners association with deed covenants seems to me like a horizontal condo – a neighborhood that has no hope of being redeveloped, no matter how high property values go, because it’s just about impossible to get 100% of that many people to agree on anything. If you believe in letting the market guide development of cities, things like deed covenants are right out. Update: Mr. O’Toole corrects me on the issue of deed covenants. In many areas, deed covenants automatically renew unless 51% of owners vote to get rid of them, which is obviously an easier threshold to reach than 100%. If that’s the case, developers could conceivably buy 51% of the lots and vote to eliminate the restrictions. That still seems like a hard way to do things, and it will prevent the market from responding to demand.

So, what would Randal O’Toole suggest that we do?

*Note that if you follow this logic through, I’m saying that allowing more urban development in LA will encourage more suburban residential, commercial, and industrial development on the edges of the region. I think this is true: construction in the LA Basin will cause growth of construction-related industries, which are the kinds of the uses that need a bunch of cheap land. Contrary to the way many people on both sides of land use debates see it, regional growth is not zero-sum.

Update: here’s his full comment.

You raise a lot of issues. First, LA may not have formal urban-growth boundaries. But LAFCos effectively prevent extension of urban development. Under California law, developers cannot create the special districts needed to support development of unincorporated land without approval from the LAFCos. Under CEQA, such approval would almost certainly require an EIR, whose cost of $15 million or more must be paid by the developer. As a result, development is pretty much restricted to existing incorporated areas. Cities can’t annex without LAFCo approval either. This explains why the L.A. urban area has become the densest urbanized area in the U.S.

Congestion can be fixed through congestion pricing. If the toll revenues generated from congestion pricing are more than needed to operate the roads, then that is a signal that more roads should be built. If not, no need to build more roads.

You misunderstand how covenants work, at least in Texas, Kansas, and many other areas. These covenants typically renew periodically unless 51 percent of lot owners in the neighborhood decide not to renew them. It doesn’t take 100 percent. Developers have been known to persuade homeowners in some Houston neighborhoods to change their covenants to allow different kinds of development.

My thoughts: first, I appreciate the correction on deed covenants.

On the issue of LAFCos (Local Agency Formation Commissions): In California, counties have LAFCos, which can approve or deny applications to incorporate new cities or annex territory to existing cities. For example, not long ago, the LA County LAFCo turned down an application to incorporate East Los Angeles, on the grounds that the city would not be able to raise sufficient revenue to fund its operations. LAFCos also approve or deny applications to add territory to service districts like water and sanitation.

While you theoretically could use a LAFCo to stymie suburban growth by denying all incorporations, annexations, service districts, and so on, that doesn’t seem to happen in practice. LALAFCo recently approved annexations to Santa Clarita and Glendora. Riverside LAFCo has approved four incorporations in the last five years (Wildomar, Eastvale, Menifee, & Jurupa Valley). LAFCOs will naturally reflect the development climate of the county; I’d guess that no one at San Bernardino LAFCo or Riverside LAFCo is that worried about confining development to existing urbanized areas. On top of that, the cities in the Antelope Valley and Victor Valley have already annexed huge swaths of undeveloped desert.

Antelope Valley:

AntelopeValley

Victor Valley:

VictorValley

Also, let’s not forget that sometimes cities incorporate to prevent more development, like say Malibu or Rolling Hills.

You could write a book about California municipal finances, and I’m no fan of CEQA requiring people to analyze things that can’t be predicted anyway, but that’s a topic for another time!