Thursday, October 29, 2009

Toll plans, TMC problems, empty nesters, Ashby regs

Yet again I've let the backlog of smaller items get too large, so I'm going to have to break them up into a couple of posts.
...demographers and economists have predicted that many aging baby boomers would opt for smaller, easier-to-manage dwellings once their children left home. Those predictions helped spur a surge in loft and condominium developments in many U.S. cities, as well as efforts to develop so-called walkable communities.

So far, the bet hasn't paid off. "The developers that anticipated a big increase in condominium living in center cities are sorely disappointed," says Gary Engelhardt, a professor at Syracuse University who's studied the influence of boomers on the housing market. The housing bust has led many people who might have sold their suburban homes to stay put. But even when the market recovers, Mr. Engelhardt says, "I don't foresee a massive movement back in center cities for older individuals."

Why not? From what I've heard, it's what you'd expect: not only do empty-nesters have deep ties to their current suburban community (church, friends, etc.), but they also want a home big enough to welcome their children and grandchildren for frequent visits.
UPDATE: Evidently the Fairmont Parkway has been taken off the current version of that map. Details here. It implies they may do it non-tolled. I hope they definitely keep the RoW here for a future freeway at some point. Tolled or not, it will be needed, if only to take some of the load off of overcrowded 45S. And the population out there is exploding. It's a great alternative to the waterfront and one of the Port terminals. Hat tip to Eric for the update.

The rest next week.

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Monday, October 26, 2009

Rice's chairman on Houston and its challenges

Jim Crownover, former McKinsey director and current chairman of the board at Rice University, spoke at event last week and made some interesting comments on Houston. He discussed some of the incredible growth Rice has seen in recent years, and expressed hope for the Baylor merger. The benefits to Houston of the Jones Business School at Rice were also outlined, including:
  • $1 billion annual contribution to gross area product (that includes salaries of all alums)
  • $345K impact per alum in Houston
  • The Rice Alliance for Technology and Entrepreneurship has helped launch over 230 startups by connecting them to $500 million in funding.
But he also listed the four major challenges Houston faces in the next decade:
  1. K-12 education
  2. Energy - will we maintain leadership? He thinks Rice can help here with a balanced approach of policy, economics, and technology.
  3. Health care - will we maintain leadership? Federal health care reform and Baylor's decline from financial problems are key issues here.
  4. Mobility/transportation: congestion growth and energy price increases will continue and our density is unlikely to change in a meaningful way, making mass transit a very difficult problem to address.
He didn't offer solutions - just said these issues need top-to-bottom focus. But he did express optimism about Houston's ability to unify and address these problems, as compared to northern cities with high legacy problems and costs, and west coast cities with "dis-integration" weaknesses (i.e. a lack of unity in solving problems). I tend to agree that our relative unity is a very important strength, and one we should preserve at all costs - even through feisty mayoral elections...

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Thursday, October 22, 2009

Report from the HRG Smart Growth Conference

It went quite well. Thanks to those of you who plowed through the rain to attend. If you're interested in some of what was said, the Land Use Prof Blog has a report. I'm also hoping to link to some of the charts and video when it's up. But in the meantime, here are a few of my observations and a portion of my intro speech:
  • Sam Staley from Reason went in depth on how land use regulation works in other cities vs. Houston. The bottom line difference was staggering: 3-4 months for development approval here vs. 2-4 years elsewhere! And that time difference adds massive uncertainty, risk, and costs.
  • Commissioner Todd Staples said Texas has the highest productivity per person and GDP per person vs. any nation. While I believe that's in the ballpark, I'm not sure that includes some of the smaller, super-wealthy countries like Norway, Luxembourg, or even Switzerland (not to mention some other states). But impressive nonetheless.
  • Wendell Cox pointed out that, on a global basis, the most sprawling cities have the shortest average commutes, with access to more jobs and higher productivity. Some of the most dense cities, like Hong Kong, NYC, and Sydney, had the longest average commutes.
  • Luis Vera of San Antonio LULAC spoke out against the inherent minority discrimination in smart growth policies, including home unaffordability and diverting transit resources from buses to rail.
  • Mike Inselmann of Metro Studies had data showing Houston is currently the #1 metro in the country for homebuilding, followed by DFW and then dropping off rapidly in other metros.
And here's the main body of my introductory speech:

We’re here today to talk about Smart Growth. Let me read the definition from Wikipedia:
“Smart growth is an urban planning and transportation theory that concentrates growth in the center of a city to avoid urban sprawl; and advocates compact, transit-oriented, walkable, bicycle-friendly land use, including neighborhood schools, complete streets, and mixed-use development with a range of housing choices. Smart growth values long-range, regional considerations of sustainability over a short-term focus. Its goals are to achieve a unique sense of community and place; expand the range of transportation, employment, and housing choices; equitably distribute the costs and benefits of development; preserve and enhance natural and cultural resources; and promote public health.”
Kinda hard to argue with? Doesn’t sound too bad? It’s a siren song that has certainly attracted a large number of communities across the country. But they have not only found that it requires extremely intrusive government control and intervention in markets to get the desired outcomes – something that seems to run against the grain of our American charter based on freedom – but it also has created many unexpected negative side effects, the most painful being the loss of affordability (from housing supply restrictions) and the price bubble that led to the recent crash. The loss of home affordability has been particularly hard on poor and minority communities. Dr. Edward Glaeser at Harvard has built a substantial academic reputation exposing these affordability problems from excessive government regulation, ironically from some of the supposedly most progressive governments. One study from the University of Washington found that regulations added $200,000 to the median price of a home in Seattle.

Additional smart growth ramifications include:
  • Costly transit investments, particularly light rail, with low ridership that fail most cost-benefit calculations and often financially hobble their transit agencies, forcing painful bus service cutbacks on the most vulnerable transit-dependent populations.
  • Inadequate road investments leading to rapidly worsening traffic congestion and gridlock, along with increased air pollution.
  • Increased taxes to afford the needed development subsidies, transit investments, and infrastructure upgrades to accommodate increased densities in areas not designed for it.
Houston has been lucky to avoid most of these fads and problems, and has remained the most affordable major metro in America. Just one data point from Coldwell Banker: the equivalent of a $155K house in Houston would cost $357K in Denver or Portland and $536K in smart-growth paragon Boulder.

Here a few of my own related observations from my blog:
  • Growth is good. Despite the hidden anti-growth attitude in smart growth, studies of cities show that a doubling of population is accompanied by more than a doubling of creative and economic output. The larger the population of a metro, the greater the innovation and wealth creation per person.
  • People want space. Sprawl is not evil. Throughout history, even going back to the medieval nobles and their country estates, people have always desired more personal space as they have grown more affluent. Make this space unavailable by forcing density through regulation or inadequate transportation, as in Europe or Japan, and not only does housing become unaffordable, but fertility rates will drop below replacement levels as families shrink. If they can’t increase the size of their home, they will shrink the size of their household, which creates a financially destabilizing demographic implosion.
  • Density has limited appeal. As young people push marriage later, we have a new twenty-something stage of life where people want to live in a dense, vibrant, urban core. But, inevitably, as they marry and start families, space, cost, and school concerns draw them to the suburbs. Cities should absolutely offer good urban lifestyle options to those who desire it, but it will always be a relatively small part of our population.
  • People cannot be forced into the dense core or on long commuter transit rides against their will. If people can’t access nice, affordable homes and good schools within a reasonable commute, employers will move out to suburbs, leading people to move even further out, expanding sprawl, and draining the core’s tax base.
  • Most southern cities, like Houston, have a pedestrian-hostile tropical climate several months of the year. While northern transit-based cities benefit from a personal warming technology – the coat – the only personal cooling technology that exists for southern cities is an air-conditioned vehicle.
  • Cities that are hostile to the car will stagnate. The car is now a permanent part of our culture. Busy lifestyles require its comfort, speed, and convenience – but the propulsion technology will change to be greener and more energy efficient. This represents the future for the vast majority – not dense, transit-oriented living.
  • Planned density almost always fails. Planners try to protect low-density areas and designate high-density ones, but, inevitably, NIMBYs protest and shoot down the high-density development if there is a regulatory mechanism for them to do so – like a zoning board they can influence. Recent data shows that Houston’s free market approach builds one-third more density per capita than Portland’s highly prescriptive, planned approach. And a recent ULI advisory panel was emphatic in recommending that Houston not adopt zoning.
  • Commuter rail rarely works in a post-WW2 car-based city. Old cities in Europe and America were built with dense cores for the primary mobility mode of the time: walking. Rail allowed people to move to the suburbs and still commute to the single dense core of jobs (like Manhattan or downtown Chicago). Newer, mostly post-WW2, car-based, Sunbelt cities like Houston have decentralized jobs spread over many different centers, like downtown, uptown, the medical center, Greenway Plaza, the Energy Corridor, Westchase, Greenspoint, Clear Lake, and more. Less than 7% of our jobs are downtown. Trying to connect commuters to these job centers with rail would not only be astronomically expensive, but would lead to impractically long commute times with multiple transfers and long walks for people to reach their final destination buildings. Instead, there is a better commuter transit solution for these types of cities: frequent nonstop express buses and vanpools in managed lanes that whisk commuters directly to their job center and then circulate to get them right to their building without transfers, waits, or long walks in unpredictable weather.
These speakers today will outline what has worked and what has not with smart growth. I’m hoping this can help us make improvements to define a vision for a “Smart Growth 2.0”. One that, for instance, enables popular new urbanist developments by removing barriers and regulations rather than adding them. With that context, let me move on to our speakers.

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Monday, October 19, 2009

Free conference this Wed on the issues of smart growth

HRG is putting on a free conference this Wednesday afternoon at the GRB downtown: "The Truth About Smart Growth: Setting the Stage for the Housing Collapse - National Conference About What Works & What Hurts." I will be doing some speaking at the event, and look forward to seeing as many of you as possible there. Should be a lively discussion. We're even hoping for some of the mayoral candidates to come by for a briefing. Details and registration are here.

Experts from around the nation and world will be on hand in Houston, October 21st to discuss the advantages and pitfalls of “Smart Growth” approaches to urban development. Of national significance is the role that market distorting policies have had on the housing collapse and, by comparison, alternative growth strategies used by some cities that have avoided such pitfalls. We expect both local and national media attention to this timely topic.

The conference is set for the George R. Brown convention Center from 2 to 5 pm on October 21st and will feature speakers and topics including:

1. Ron Utt, The Heritage Foundation - Price Inflation Through Public Policy” “Housing Bubbles” evidence from UK study indicating price inflation as a direct result of the Town and Country Planning Act.

2. Wendell Cox, Demographia- How Texas’ regulatory environment helped us resist the economic downturn.

3. Sam Staley, The Reason Foundation - How Houston’s free market land use system is superior, the advantages of it, and how it compares to the traditional planning process.

4. Mike Inselmann, Metro Studies - Case study of national housing prices and trends - Which areas were most affected during recent housing bubble crisis and what types of regulations caused the problem.

5. Randal O’Toole, The Cato Institute - Present an alternative vision that achieves same goals. What are mild incentives to encourage market driven growth? The fiscal impacts on local governments.

6. Luis Vera, Pacific Legal Foundation, LULAC – “Protecting land owner/ home owner rights” in courts - will examine what smart growth policies do to affordability and the damaging effects that they have had on the middle and lower class.

7. Special Guest: Todd Staples, PAC! Off: It's My Land - Presentation of a new pro-Proposition 11 coalition comprised of associations and state leaders concerned about abusive takings of private property by government eminent domain.

As you can see, this respected group of scholars will be discussing the myths and the realities of centralized government growth and development controls, significantly, here in the largest American city without zoning—and in the city that has resisted the worst effects of the housing downturn.

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Sunday, October 18, 2009

Lessons for Houston from the global urban revolution

Thanks to a generous invitation from the World Affairs Council of Houston, I was able to attend a recent talk by Jeb Brugmann, author of "Welcome to the Urban Revolution: How Cities are Changing the World", on "Cities of the Future: Ideas for Houston from Cities of the World." Most of his talk focused on the benefits and risks of the rapid urbanization of our planet, especially in the developing world (with a focus on India). He articulated four primary benefits that are driving the global rural-to-city migration:
  1. Concentration: making markets with proximity economies of scale. Our own example is the concentration of flower shops along Fannin north of the Medical Center, not to mention various farmers' markets.
  2. Density: the most efficient possible cost structure. His developing world examples were similar to what you'd see in the NYC immigrant tenements 100+ years ago. While I agree that, in a world of walking and transit mobility, maximizing density is important, I don't think it's necessarily the optimal answer when societies become wealthy enough that other mobility technologies start to dominate, like the personal vehicle. It is all about maximizing connections to other people, and that is a combination of density and mobility, or what I refer to as opportunity zones.
  3. Association economies
  4. Extension of urban infrastructure and connections
As for urbanization risks, he mentioned several: crime (inc. organized crime), populism from income disparities, disease spread and mutation, and the financial/housing crisis. I did not know that the Pearl River delta in China, home to hundreds of exotic live animal markets, is a major source of mutating animal diseases that jump to humans (like SARS a few years back).

The most interesting part of his talk was on Curitiba, the Brazilian city famous for its BRT transit system. Some of his points on their system offer good lessons for Houston:
  • The transit system is profitable, which is unheard of.
  • 100 private bus companies compete
  • Not master planned (more organic)
  • Dedicated bus corridors
  • Different optimally-sized buses by route
  • Boarding tubes/shelters like the subway, to speed payments and boarding
  • 385 routes
  • 40-second headways (not sure on how many of the routes)
  • 45% of daily trips are profitably served by BRT
  • They have the most autos per capita of any Brazilian city, but the least gas usage per capita
This amazing high-service, low-cost system could easily be achieved in Houston if we were less obsessed with pouring billions into rail.

He ended abruptly by saying the new urbanist, mixed-use densification of San Jose, CA represented the future, and Houston should emulate it. He said they wanted to move away from the private corporate campus model of the tech companies. I don't buy it. Can you imagine Google or Apple maintaining their security if their buildings were part of a mixed-use campus open to the public? And San Jose's transit system is one of the larger disasters in America. A key excerpt:
...VTA has “the worst operating statistics of any American transit operator.” The reason for this, he says, is that San Jose — being built mostly after World War II — is one of the most spread-out urban areas in the country. Not only are people spread out, but jobs are spread out, with no job concentrations anywhere.

This makes large buses particularly unsuitable for transit because there is no place where large numbers of people want to go. So what was VTA’s solution when its bus numbers were low relative to other transit agencies? Build light rail — in other words, use an expensive technology that requires even more job concentrations.

Now it has one of the, if not the, poorest-patronized light-rail systems in America. So what is its solution? Build heavy rail, a technology that requires even more job concentrations.

The initial analysis for building BART to San Jose, Rubin notes, projected that it would cost more than $100 to get one person out of their car for one trip on BART (!!!). (By comparison, most bus improvements cost $2 to $6 per new ride, while light rail usually costs around $10 to $30 per new ride.) To make the numbers look better, VTA assumed that downtown San Jose would grow to be 80 percent the size of downtown San Francisco, which Rubin considers unlikely in the extreme. Even if it builds this BART line, VTA admits it doesn’t have the money to operate it.

VTA is now so heavily in debt that when the dot-com bust hit Silicon Valley, it was forced to cut transit service by nearly 20 percent. The in turn contributed to a 33 percent loss in transit riders. This makes San Jose’s light rail a true planning disaster and suggests that BART to San Jose, if it ever gets built, will be an even bigger disaster.

The fact that VTA is willing to sacrifice its transit riders in order to persue a dream of ever-more-expensive rail transit leads Rubin to conclude that, while he doesn’t know for sure if VTA is the worst-managed agency, “if there is a worse one out there, I hope I never find it.”

Does any of this sound ominously similar to Houston's direction?

I think there will be many more mixed-use, new urbanist projects, and they will be popular, but they will not be fundamentally transforming either San Jose or Houston. We will change the propulsion technology of cars before we make any mass, fundamental shift to density and transit.

On the other hand, he did make one point that I wholeheartedly agree with: it is extremely important to have a vibrant local developer community to do customized local development for a particular city's situation. Customize the urbanism, transit, and transportation to the city. Curitiba went against convention with BRT over heavy rail like NYC, London, and Tokyo. Houston should do the same.

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Wednesday, October 07, 2009

Summer 3Q09 Highlights

First, a quick note: I'll be traveling over the next week or so, and probably not blogging.

It's time for the Summer 3Q09 quarterly highlights post. These posts have been chosen with a particular focus on significant ideas I'd like to see kept alive for discussion and action, and they're mainly targeted at new readers who want to get caught up with a quick overview of the Houston Strategies landscape. I also like to track what I think of as "reference posts" that sum up a particular topic or argument.

Don't forget we offer an email option for the roughly twice/week posts - see the Google Groups subscription signup box in the right sidebar. An RSS feed link (Atom) (or RSS 2.0) is also available. As always, thanks for your readership.

And from Spring 2Q09

Winter 1Q09:

And don't forget the highlights from the first four years. For what it's worth, I think the best ideas are found there, often in the first year (I had a lot "stored up" before I started blogging).


Touting Houston's approach to planning

Just wanted to pass along some of the great excerpts/quotes from this morning's front page Chronicle story on Montrose's award:

Eclectic, walkable and one of top 10

Montrose, the central Houston community known for its diverse lifestyles, vibrant street life and stately historic homes, is being honored by the American Planning Association today as one of the country's 10 great neighborhoods.

Houston's sprawl, absence of zoning and reputation for haphazard development might make its recognition by the national planning establishment something of a surprise. Yet the qualities cited in the award for Montrose — its walkable street grid, carefully preserved historic districts and eclectic mix of homes and businesses — reflect Houston's preference for private rather than government-imposed planning, experts said.

In the early 20th century, long before it became the focus of slum-clearing urban renewal projects or the heart of Houston's gay and lesbian community, Montrose was an elite master-planned suburb, said Stephen Fox, a Rice University architectural historian.

“Its planning has really come from the developers of the individual subdivisions rather than representing any public policy,” Fox said.


Robinson, an architect who serves on Houston's City Planning Commission, said the award shows that effective planning need not be imposed through heavy-handed government policy.

It doesn't have to always be a prescribed method of growth,” Robinson said. “It's organic. The street grid, the sidewalks have meant that without zoning and for the most part without restrictive covenants, the area has been able to grow and adapt.

The street grid — a web of straight streets with short blocks and none of the cul-de-sacs favored in suburban neighborhoods — has helped keep Montrose walkable since the days when people stepped off streetcars and walked to homes or shops, Robinson said.

David Morley, a research associate at the American Planning Association, said Montrose's pedestrian-friendly nature was an important factor in the award.

“It's one of the few places in Houston where people get out of their cars and walk around,” Morley said.

Marlene Gafrick, Houston's director of planning and development, said the award should help to dispel Houston's undeserved reputation as an unplanned city.

“I believe planning occurs at many levels, and one of the differences between Houston and a lot of cities is that a lot of our planning comes from the ground up rather than the top down,” she said.

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Monday, October 05, 2009

Thoughts on recent transportation news

The Chronicle has had several transportation and transit related articles in the last few days. The first, on different agencies and plans for commuter rail, discusses Metro vs. the freight rail district vs. the city of Galveston. All three proposed lines have flaws that could potentially make them as stupid as Austin's new line (Christof's word, not mine). Two stop at the 610 loop rather than getting into key core destinations because of inside-the-loop rail congestion. The third, Metro's 90a proposal, stops in Missouri City, rather than continuing to where all those med center workers actually are in Sugar Land. That's because Metro's service area does not include Ft. Bend County.

It's almost like all of them want to build a white elephant so they can then point to the low ridership and make an argument to sink a lot more into extending it to where it actually should have gone in the first place. And nobody is talking about the critical problems of commuter rail in multi-centric, job-dispersed Houston: it is slower, less frequent, far more expensive, and drops you farther from your destination (in the heat, humidity, and rain) than express commuter buses in HOV lanes - all of which will be canceled as the rail lines get built. Why are we so hell bent on rushing headlong to a less convenient and more expensive transit system?

The second story is on the mayoral candidates and their mobility plans. Most of it sounds pretty reasonable. Except this:

[Peter] Brown said, “You can't serve a low-density city like Houston with a bus system.” (huh?!) He did not specify what he wants Metro to focus on instead, but called for the bus and rail systems to be “integrated.”

“We've got to have a rationalized plan for rail, and bus to feed the rail,” Brown said. “We've got to encourage people to live closer to where they work.”

If transit can't serve a low density city with buses, what the heck is the answer? It sure isn't rail, which is all about heavy density and ridership. And if you look at what happened after the Main St. line opened, "integrated" is a code word for "we're going to cut your convenient, direct, single-bus route and make you transfer several times to different trains and buses." Oh, and system ridership will drop sharply as a result. Great plan.

As far as "encouraging" people to live closer to work: it's not like people are idiots and want to live as far from work as possible. They weigh up a lot of factors to make their housing decision, including affordability, schools, home quality, amenities, and balancing the demands of two different commuters that are likely to change jobs several times. Every job center in Houston has tons of housing all around it - but there are very good reasons most of the employees in those job centers don't choose that housing.

Or maybe Peter wants the major employers of Houston to leave for the suburbs where their employees are, draining the city's tax base?

Lastly, there is this op-ed today urging Metro to take care with the light rail planning and construction. It ended with a challenge of sorts:
Our city's brightest minds and most experienced voices need to articulate a vision for the city's future growth and its transportation solutions that is in-step with the historic heartbeat of Houston.
For the record, mine is here and here.

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Thursday, October 01, 2009

Houston culture and brand, moving Americans, HSR, rail maps, and more

Another set of smaller items:
I heard an interesting new candidate for Houston's tag line/brand/identity the other day: "Houston: A New Energy" (credit to Marc Nathan). I like that a lot. Plays off the whole Energy Capital thing, but also hints at initiatives in alternative energy, nanotech, and biotech. It also reflects the entrepreneurial energy here. Another variant would be something like "Warm Energy" to reflect the hospitality/friendliness - but that one doesn't work as well. What do you think? I'd love to hear other suggestions in the comments.

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