Employment Centers and Agglomeration Economies: Foundations of a Spatial Economic Development Strategy
Previous research provides evidence that jobs and firms in U.S. metropolitan areas are concentrated in economic centers, creating a polycentric urban form. Previous research also suggests that firms realize localization economies when they locate near other firms in the same industry and urbanization economies when they locate near firms in other industries. In this article, we tie these concepts together in an exploration of the spatial distribution of employment in the Baltimore-Washington metropolitan area. Our analysis suggests that the spatial distribution of employment in Maryland is characterized by the existence of concentrated employment centers that create a polycentric urban form. What is more, we find these centers provide both urbanization and localization economies as well as unspecified locational advantages.
This study presents a summary of stakeholder perspectives on the effectiveness of Maryland's Priority Funding Areas and barriers to growth within PFAs. It relies upon responses to a telephone survey of forty-seven representatives from three key stakeholder groups—planners, policy advocates and consultants, and developers.
Passed in 1997, Maryland’s Smart Growth and Neighborhood Conservation Initiative took a novel approach to growth management, utilizing the power of the purse to encourage sustainable development. The initiative seeks to discourage suburban sprawl through a targeted spending approach, while also allowing local governments to retain their land use decision-making authority. It required local governments to designate Priority Funding Areas (PFAs) where state infrastructure funding would be focused. Through this tool, the State aimed to promote development and revitalization within Maryland’s urbanized areas, while limiting the urbanization of Maryland’s rural areas and green spaces.[i]
Data from the Maryland Department of Planning, however, suggests that PFAs are having limited impacts. The percent of single-family acres developed outside of PFAs has risen steadily over time.[ii] Development densities have declined in PFAs, with the average parcel size inside PFAs increasing from 0.25 acres in 1990 to 0.28 acres in 2004.[iii] Despite their disappointing performance, PFAs are anticipated to play key roles in future policies regarding development on septic systems and in PlanMaryland, the state development plan.
Given their growing prominence but questionable efficacy, PFAs warrant further examination. That is the purpose of this study, conducted by the Housing Strategies Group of the National Center for Smart Growth Research and Education at the University of Maryland, and funded by the Maryland State Builders Association and NAIOP Maryland chapters. The study relies upon responses to a telephone survey of forty-seven representatives from three key stakeholder groups—planners, policy advocates and consultants, and developers. HSG made every effort to obtain the perspectives of a variety of sources but it is important to note that the survey respondents could not be said to be randomly selected and the sample size is too small for rigorous statistical analysis.
While not presenting new empirical analysis of the influence of PFAs on development patterns across the State, the study does produce new information on how critical stakeholders view the efficacy of PFAs and the barriers to development inside PFAs:
- Most respondents think PFAs are only somewhat effective or not effective at all. Of those responding to the question, “To what extent have PFAs been an effective urban growth management tool?” 78 percent responded either “not at all effective” or “somewhat effective.” When asked to comment on the effectiveness of PFAs, respondents from each of the three groups interviewed mentioned inconsistencies between state and local planning objectives as contributing to the ineffectiveness of PFAs. In theory, PFAs can provide the opportunity to reduce uncertainty and development costs by coordinating state and local infrastructure investments. There have also been examples of local governments reducing impact fees and providing expedited review processes within their PFAs, but these cases are generally more the exception than the rule. Most suggested that PFAs are either ignored in the local planning process or create additional impediments to local planning, because existing land use patterns and development rights predated the establishment of PFAs. In one jurisdiction, local growth areas are intentionally drawn to be larger than PFAs to create a “buffer” between existing urbanized areas and areas planned for future growth. In explaining continued growth outside PFAs, planners in particular pointed to legacy zoning and grandfathered permits. Others pointed to consumer preferences and the relative ease of development outside PFAs from the regulatory and community opposition perspectives. When development does occur within PFAs, state policy is often less a factor than the strength of the local market for PFA development.
- Most respondents think it’s more difficult to develop land inside than outside PFAs. When asked, “Holding other things constant, do you believe it is more difficult to develop land inside or outside PFAs?” respondents citing “inside” PFAs outnumbered those citing “outside” by almost four to one. A large percentage (29 percent) also indicated that designation inside or outside a PFA had no impact on the difficulty of development. Several indicated that the difficulties arise not from spatial differences in regulations but in how they are applied. Citizen opposition, for example, can be more severe within PFAs, because the higher density of development implies satisfying a larger number of constituencies. The difficulty of assembling multiple parcels of land makes “staging” of development inherently more difficult. Parking must often be built as structured parking below-grade, increasing construction costs. Utility easement requirements (i.e. 10-foot right of way requirements) often inherently favor suburban development. Environmental regulations, while not directly designed to discourage development within PFAs, may be more difficult to satisfy due to the higher probability of soil contamination combined with additional requirements to achieve LEED certification. Satisfying APFO requirements can also be more difficult within PFAs where roads, schools, and other facilities are more burdened.
- Citizen opposition, consumer preferences, APFOs, scarcity of zoned land, lack of infrastructure, and stormwater management regulations are the most commonly-cited constraints to developing inside PFAs. Respondents were asked to identify from a list of conditions, which were impediments to development or redevelopment inside PFAs and which were among the top three impediments. The most frequently cited impediments include stormwater management regulations and citizen opposition. Respondents from all categories suggested that recent changes in the State’s stormwater mitigation requirements make redevelopment within existing urban areas more difficult. When asked to prioritize the impediments, the most frequently cited items included citizen opposition, APFOs, scarcity of zoned land, and lack of infrastructure. Combined, these suggest that local regulatory processes requiring substantial citizen review, which are also tied to local infrastructure capacity constraints through APFOs, or ad-hoc moratoria can impose significant constraints to development within PFAs. Respondents also identified quality-of-life considerations, particularly schools and crime, as influencing market demand within PFAs. Developers remarked that inconsistencies between current soft-market realities combined with stringent regulatory constraints limit the feasibility of development within many PFAs. Inappropriate requirements for ground-level retail square footage, parking, stormwater management, and environmental standards are some examples of such inconsistencies.
- High rise apartments and mixed use developments are viewed as the most difficult products to develop within PFAs. All three groups indicate that while the market for multifamily and mixed-use projects is strongest within many PFAs, these development types are also the most difficult to capitalize and bring to completion. When asked to elaborate, citizen opposition, land availability, economic return and infrastructure capacity were all frequently-cited constraints facing developers of these project types. Several respondents also pointed to a general lack of understanding among the public about mixed-use developments and their potentially beneficial community impacts.
- Zoning and the adequacy of infrastructure are viewed as the most influential public policy tools. When asked, “Which of the following planning tools is the most important determinant of whether or not a development or redevelopment projects will be approved on a given parcel of land?” a parcel’s status vis-à-vis the PFA made little difference, according to the three groups interviewed. The most important determinants of development approval are the parcel’s zoning and the existence of adequate infrastructure. Policy advocates also point to the importance of local public support and political leadership.
Survey respondents identified a number of ways to improve development conditions in PFAs, ranging from limiting the length of APFO restrictions to reducing impact fees and lowering level of service requirements for certain types of infrastructure inside PFAs. Other recommendations included expediting the state agency review processes and lessening stormwater management and other environmental protection requirements for projects inside PFAs.
Based on the findings of this and previous studies, the HSG offers the following recommendations:
- Require that PFAs be consistent with growth areas, incorporated into comprehensive plans and be reviewed as part of the comprehensive plan review process every ten years. Currently, PFAs are not required in comprehensive plans, which are reviewed every six years.
- Require that PFAs contain sufficient development capacity for 20 years of residential, institutional, commercial, and industrial growth. Currently, PFA capacity criteria include only residential development.
- Provide local governments with greater flexibility in constructing PFAs if they place greater restrictions on development outside PFAs. This recognizes that “one size does not fit all” when it comes to PFAs across the State and would provide local governments some flexibility on the size of PFAs if they restrict development outside PFAs.
- Require local governments to include a housing element in their comprehensive plans that permits, but does not require, high density and mixed use development.
- Establish minimum zoned density requirements that vary for urban, suburban, and rural PFA communities.
- Enable local governments to reduce regulatory restrictions (e.g., road service standards, stormwater management and forest preservation requirements) inside PFAs, especially in transit station areas.
- Limit development moratoria from adequate public facilities ordinances to four years. If moratoria cannot be lifted in four years, require local governments to increase development capacity elsewhere.
- Target state infrastructure spending in areas within PFAs under adequate public facilities ordinances moratoria.
- The State should work with local governments and other development stakeholders to further identify barriers to growth specific to the PFAs within each jurisdiction. Collectively they should work to identify options for overcoming these barriers.
- The State should work with local governments to periodically conduct a statewide infrastructure needs assessment as well as a review of growth related capital funding approved and planned by the state and local governments.
[i] Knaap, Gerrit-Jan, and John W. Frece (2007). “Smart Growth in Maryland: Looking Forward and Looking Back.” Idaho Law Review 43, 445-473.
[ii] Sartori, Jason, Terry Moore, and Gerrit Knaap. Indicators of Smart Growth in Maryland. National Center for Smart Growth Research and Education, January 2011.
[iii] Lewis, Rebecca, Gerrit-Jan Knaap, and Jungyul Sohn (2009). “Managing Growth With Priority Funding Areas: A Good Idea Whose Time Has Yet to Come.” Journal of the American Planning Association 75:4, 457-478.
Maryland is often referred to as the birthplace of smart growth, a movement in land use planning that contributed to what is now referred to as sustainability planning, sustainable development, and sustainable communities. Maryland adopted a Smart Growth Program in 1997 with the primary purposes being to use incentives to (1) direct growth into areas already developed and having public facilities, and (2) reduce the conversion of farm, forest, and resource land to urban uses.
The National Center for Smart Growth Research and Education at the University of Maryland was established in 2000 in large part because of Maryland’s leadership in the field of smart growth. Its mission is to provide research and leadership training on smart growth and related land use issues in Maryland and in metropolitan regions around the nation. Thus, a key focus of the Center’s research is Maryland’s Smart Growth Program: where is it effective, and how can it be improved?
This report provides some indicators (also called performance measures) that suggest answers to those questions. The term “suggest” is important: (1) there are many limitations of any assessment based on indicators, no matter how well developed, and (2) the indicator assessment reported here is only in its preliminary stages. Understanding the limitations of indicators is critical to interpreting their significance. Thus, Section 2 and Appendix B of this report discuss in some detail data, methods, and limitations.
Researchers and policymakers acknowledge those limitations, but that acknowledgement does not slack their desire for indicators that say something concrete about whether desired outcomes are being achieved, and at what cost in direct expenditures and spillover effects; and about directions for policy that would increase the desired outcomes, reduce the costs, or both. Sections 3 and 4 address those issues.
Section 3 reports indicators for six categories of issues. Population and employment growth drive development. That development is the immediate concern of the two thrusts of the Maryland Smart Growth Program: it puts pressure on the natural areas that the Program wants to protect, and it can occur in development patterns that not only eliminate and vitiate those natural areas, but also are inefficient from the perspective of providing transportation and other infrastructure and, ultimately housing (and other buildings). Some of the key findings:
- Population. The population growth rate in Maryland approximately equals the national average. The indicators give no direct, rigorous, or even casual evidence that the Smart Growth Program either increased or decreased the amount or composition of population growth statewide.
- Employment. Employment and other measures of economic activity have consistently grown over the last two decades in Maryland and all its regions. From 2000 to 2009, Maryland had the 13th highest annualized rate of job growth (1.0%) among the 50 states. Indicator data allow the conclusion that the Smart Growth Program did not stop economic growth, but they do not allow a conclusion about whether the Program increased or decreased that growth from what it would have been in the absence of the Program.
- Transportation. For most measures of transportation performance that are standardized, Maryland looks like other states: VMT, congestion, and car ownership have risen consistently over time. Maryland has higher transit ridership than most states, some of which may be attributable to the Smart Growth Program but most of which is attributable to Maryland’s proximity to Washington, D.C. and its own historical investments in transit (especially in Baltimore and in suburban Maryland) that pre-date the Program.
- Development patterns. Urban development continued in Maryland at densities lower than several comparison states from 1990 to 2000. Most of that growth has not been infill of urban areas: the predominant form of urban development in Maryland remains suburban. Three-fourths of the new single-family acres were developed outside PFAs since 1997. Indicators of Smart Growth in Maryland NCSGRE January 2011 Page 3 While this indicator has shown some improvement in recent years, the share of parcels developed outside PFAs continues to demonstrate an increase over time. Despite increases in density for the state as a whole (which is inevitable if there is any population growth), a substantial amount of Maryland’s new growth has been occurring in the exurban areas of the state. The share of population that lives within a half-mile of rail transit stations, however, has generally risen over time.
- Housing. Although the single-family share of new housing construction has fallen recently, the single-family share of housing in Maryland is high for a highly urbanized state. Housing prices have inflated faster in Maryland than most other states the last few decades, clearly raising questions of affordability, which varies across the state.
- Natural areas. The trends for acres of farm and forest land have been steadily downward in Maryland and the U.S. for a long time, but data suggest that rate of decline is decreasing. Maryland and its counties have protected well over 1.3 million acres of land. There is still, however, a substantial amount and percent of critical land that is not protected. Measures of air quality are mainly stable or improving, yet measures of water quality demonstrate poor conditions in watersheds across the state.
If the indicators here are leaning in any direction, it is that Maryland has not made substantial progress toward improving its performance in many of the areas pertaining to smart growth. There are, however, reasons to qualify a direct conclusion like that one:
- Without the kind of research design that goes well beyond the reporting of indicators into statistical controls for multiple explanatory variables, there is no solid way to rebut the hypothesis that what the Maryland Smart Growth Program did was to prevent many indicators from getting much worse than they are.
- Things take time. Many changes in technology, social attitudes, prices, and the built environment occur slowly. Indicators of Smart Growth in Maryland NCSGRE January 2011 Page 4
- If it is too early to expect to see much by way of results (e.g., changes to trends) then perhaps indicators of outcomes should be supplemented by indicators of inputs: of efforts made to stimulate future change (i.e., the number and strength of policies to change the patterns and effects of growth).
A Functional Integrated Land Use-Transportation Model for Analyzing Transportation Impacts in the Maryland-Washington D.C. Region
The Maryland-Washington, DC region has been experiencing significant land-use changes and changes in local and regional travel patterns due to increasing growth and sprawl. The region’s highway and transit networks regularly experience severe congestion levels. Before proceeding with plans to build new transportation infrastructure to address this expanding demand for travel, a critical question is how future land use will affect the regional transportation system. This article investigates how an integrated land-use and transportation model can address this question. A base year and two horizon-year land use-transport scenarios are analyzed. The horizon-year scenarios are: (1) business as usual (BAU) and (2) high gasoline prices (HGP). The scenarios developed through the land-use model are derived from a three-stage top-down approach: (a) at the state level, (b) at the county level, and (c) at the statewide modeling zone (SMZ) level that reflects economic impacts on the region. The transportation model, the Maryland Statewide Transport Model (MSTM), is an integrated land use-transportation model, capable of reflecting development and travel patterns in the region. The model includes all of Maryland, Washington, DC, and Delaware, and portions of southern Pennsylvania, northern Virginia, New Jersey, and West Virginia. The neighboring states are included to reflect the entering, exiting, and through trips in the region. The MSTM is a four-step travel-demand model with input provided by the alternative land-use scenarios, designed to produce link-level assignment results for four daily time periods, nineteen trip purposes, and eleven modes of travel. This article presents preliminary results of the land use-transportation model. The long-distance passenger and commodity-travel models are at the development stage and are not included in the results. The analyses of the land use-transport scenarios reveal insights to the region’s travel patterns in terms of the congestion level and the shift of travel as per land-use changes. The model is a useful tool for analyzing future land-use and transportation impacts in the region.
In this paper, we examine a highly localized contagion effect of foreclosures and find strong evidence that social interactions influence the decision to foreclose. We utilize a hazard model and a unique spatially explicit dataset documenting parcel level residential foreclosures in Maryland for the years 2006 through 2009. We combine these data with tax and assessment data, loan data, Census, and unemployment data. These data allow us to control for important factors influencing the likelihood of foreclosure within a given community, including the prevalence of subprime loans and the distribution of socioeconomic characteristics. Additionally, we use the tax data to construct variables describing individual homes, surrounding homes, and community. These variables include structural characteristics of houses, their price history, and length of ownership.
Hotspots for Growth: Land Use Change and Priority Funding Area Policy in a Transitional County in the U.S.
This paper uses a logit model to estimate whether and to what extent Maryland’s Priority Funding Area (PFA) program steers urban growth to locations inside targeted growth area boundaries of an ex-urban county in the outer suburbs of the Washington, D.C. region. The results of our model indicate that the size of an agricultural parcel, its distance from urban parcels, its proximity to highways, the quality of the land for agriculture, and the location in or outside of PFAs influence the probability an agricultural parcel will remain in agriculture or be converted to urban use. We find that some of the areas experiencing the greatest market pressure for development are located outside PFAs and, although Maryland’s incentive-based strategy reduces the likelihood a parcel outside a PFA will transition to urban use, this policy is not one hundred percent effective.
In this paper we describe a multiobjective optimization model of "Smart Growth" applied to land development in Montgomery County, Maryland. The term "Smart Growth" is generally meant to describe those land development strategies which do not result in urban sprawl, however the term is somewhat open to interpretation. The multiobjective aspects arise when considering the conflicting interests of the various stakeholders involved: the government planner, the environmentalist, the conservationist, and the land developer. We present a formulation, which employs linear and convex quadratic objective functions for the stakeholders that are subject to polyhedral and binary constraints. As such, the resulting optimization problems are convex, quadratic mixed integer programs which are known to be NP-complete (Mansini and Speranza, 1999). We report numerical results with this model and present these results using a geographic information system (GIS).
This paper illustrates the use of scenarios in land use, environmental and transportation planning in and around the State of Maryland. Different assumptions about futures result in different patterns of growth with differential impacts on particular sectors of the economy. Such different patterns require formulation of contingent plans as well as robust plans. In this paper, we illustrate the quantitative modelling methodology of loosely linked economic demographic, transportation and other impact assessment models in constructing two scenarios; one of which represented the best possible guess about the continuation of the future and other involving rapid changes to energy prices and Federal spending. We illustrate the spatial development outcomes and the transportation and environmental plans that are necessary to deal with these different outcomes. Further, we illustrate that different planned actions have different efficacies in different futures and thus multiple futures should be carefully considered. Finally, we illustrate the notions of contingent plans and robust plans.
Problem: In 1997, the State of Maryland adopted a bold new approach to growth management based on a novel instrument: priority funding areas (PFAs). PFAs contain growth by directing state spending to areas designated by local governments and reviewed by the state government. Despite widespread acclaim and subsequent imitation, little is known about whether PFAs effectively contain urban growth.
Purpose: The purpose of this article is to evaluate the adoption, implementation, and performance of PFAs in Maryland in order to provide planners and policymakers with insights into their efficacy as instruments for managing growth.
Methods: First, we describe the statutory definition and mandated role of PFAs in state funding. Then, we describe the process used to create PFAs, the resulting pattern of targeted growth areas, the relationship between PFAs and local comprehensive plans, and the extent to which PFAs altered state spending. Finally, we examine the effects of PFAs on residential development patterns.
Results and conclusions: We find that PFAs have fallen short of expectations. The criteria used to establish PFAs produced boundary configurations that vary widely and are in many cases not ideally suited to managing urban growth. Ten years after their official designation, PFAs are not well integrated in land use decision making processes in many local jurisdictions. Finally, state agencies have not altered budgetary systems to monitor and guide the spatial allocation of funds and there is little evidence that after 10 years they have had any effect on development patterns.
Takeaway for practice: Targeting state funds to promote compact growth is a conceptually sound approach to urban growth containment, as land is less likely to be developed if it is not served by public infrastructure. But, as with other planning tools, the key is effective implementation. If states want to contain growth by targeting state spending, they must change budgeting processes to ensure that funds are spent appropriately and that the level of state spending is large enough to make a difference.
This paper illustrates the application of various forecasting methodologies in constructing multiple scenarios for the state of Maryland using Long term Inter Industry Forecasting Tool that tracks inter-industry outputs at a macro scale, and State Employment Model that disaggregates these outputs to the states. We then use accessibility, land availability and observed relationships of employment categories to distribute employment at a county level. In this paper, we identify the possible advantages and pitfalls of using large scale economic models to drive employment forecasts at the county level. This framework allows for simulating the implications of macroeconomic scenarios such as changes in exchange rates and unemployment levels, as well as local land use and transportation policies on local employment and demographics. In particular, we focus on two scenarios as test cases both of which involve very different ideas about how future might unfold and their effects on land use and transportation policy prescriptions. One of the scenarios involves, among others, rises in health care spending over the next few years and the other involves increases in energy prices. As will be shown, they have different spatial effects and suggest different policy actions on the part of various governments.
Evaluating the Impacts of the Community Legacy and Neighborhood BusinessWorks Programs: A Review of Twelve Selected Communities
The Community Legacy program was established in 2001 through a bill introduced by the administration of former Maryland Governor Parris N. Glendening as part of the larger Smart Growth and Neighborhood Conservation Initiative. The Community Legacy program and its companion effort, the Neighborhood BusinessWorks program, were specifically created to direct state resources to existing community-scale neighborhoods as part of the state’s broader effort to reverse a decades-long trend of urban disinvestment and abandonment. Considered somewhat unorthodox when they were started, these programs have since become readily accepted by local governments as mainstays of their revitalization strategies.
In this study, the National Center for Smart Growth, working with the Division of Neighborhood Revitalization at the Department of Housing and Community Development, conducted an analysis of randomly selected Community Legacy investments from the period 2002 to 2005. The analysis provided an assessment of the impact and effectiveness of the Community Legacy program and the value of its awards to communities undergoing revitalization.
This paper presents a study of recent urban growth patterns in the state of Maryland, which is known as a leader in the current smart growth movement. Five research questions are addressed in this study. First, what have been the trends in urban growth and land use in Maryland for the past 30 years? Second, to what extent have recent urban development patterns in Maryland matched the typical characterization of sprawl? Third, how have the intensity of urban land uses and the physical forms of urban growth in this state varied among its counties? Fourth, have the smart growth initiatives, especially the “Smart Growth Area Act,” significantly affected urban development patterns? Fifth, does the effectiveness of smart growth initiatives vary significantly across local jurisdictions? To answer these research questions, we measure, analyze, and model urban development patterns in Maryland using land use and land cover (LULC) and demographic data for 1973, 1992, 1997, 2000, and 2002. By calculating several important indicators of urban development patterns, we find that for the past three decades population densities have continued to decrease for the state as a whole. However, this trend has slowed since 1997, when the state implemented the smart growth programs. The land conversion rate has somewhat decreased, which indicates that smart growth initiatives have helped, in a limited way, curtail the growing demand for urban land and residential space. Further, we find that the patterns of urban growth and land use have generally become slightly less fragmented and more continuous since 1997. Additionally, we find significant variations in urban development patterns among local jurisdictions. In general, higher densities, higher levels of compactness, and lower levels of fragmentation are observed in the more urbanized counties. Moreover, by estimating a series of logit models of land conversion, we find that Maryland’s “Smart Growth Area Act” has generally increased the probability of land use change from non-urban to urban for areas designated as “Priority Funding Areas.” The effectiveness of this program, however, varies significantly across the counties. We discuss the implications of these findings and identify the directions for future research.
At the request of the Prince George's County Economic Development Corporation, the National Center for Smart Growth Research and Education and the University of Maryland's Real Estate Development Program have undertaken an analysis of the federal government's leasing presence in the greater Washington metropolitan region.
The analysis finds that Prince George's County, when compared with the other jurisdictions in the region, does not receive its proportionate share of GSA real property leasing.
Spring of 2007 will mark the 10th anniversary of the passage of Maryland’s Smart Growth and Neighborhood Conservation Initiative; an effort designed to discourage sprawl development, foster more compact communities, protect the best remaining farms and open space in the state, and save taxpayers from the growing cost of providing services and infrastructure to serve far-flung development. Almost before its various provisions took effect in 1997 and 1998, the Maryland initiative generated interest and acclaim across the country. It received numerous awards and became the principal legacy of the program’s primary architect, former Governor Parris N. Glen- dening. Governors in other states, such as New Jersey, Colorado and Massachusetts, instituted their own “smart growth” proposals, often modeled after portions of the Maryland program. Even the popularity and wide usage of the now omnipresent phrase “smart growth” can be attributed in large part to the Maryland program.
But, what has been the effect of Maryland’s Smart Growth pro- gram? Looking at it some ten years later, has it worked? Did it accomplish what it was designed to do? What have been the strengths and weaknesses of the Maryland approach, and how can lessons from the Maryland experience be used to offer a new set of policymakers in Maryland, as well as elsewhere in the nation, practical suggestions on how to make smart growth smarter?
State Agency Spending Under Maryland’s Smart Growth Areas Act: Who’s Tracking, Who’s Spending, How Much, and Where?
In 1997, the Maryland General Assembly enacted the Smart Growth and Neighborhood Conservation initiative, an attempt by state government to use the state budget to concentrate urban development in certain areas. The primary vehicle for this approach was embodied in the Smart Growth Areas Act, which required that all “growth-related” funding by state agencies occur in locally designated “Priority Funding Areas” (PFAs) that met certain state criteria. The intent of the Act was to restrict state spending so it became easier for local governments and private developers to concentrate urban development within the PFAs, while at the same time, discourage development outside PFAs.
Data recently released by the Maryland Department of Planning, however, reveal that the Act is not having its intended effect. Although approximately three-fourths of all residential permits issued from 1990 to 2004 were for development inside PFAs, approximately three- fourths of the land developed for residential use over the same period was developed outside PFAs. Furthermore, the share of permits issued for residential development outside PFAs has risen from approximately 28.6 percent in 1998 to 31.6 percent in 2004, while the share of acres developed for residential use outside PFAs has risen from 76.7 percent in 1998 to 77.2 percent in 2004.1 These data suggest that the Smart Growth Areas Act has not concentrated growth inside PFAs as intended.
At the request of the Prince George's County Economic Development Corporation, the National Center for Smart Growth Research and Education and the University of Maryland's Real Estate Development Program have undertaken an analysis of the federal government's leasing presence in the greater Washington metropolitan region.
The analysis finds that Prince George's County, when compared with the other jurisdictions in the region, does not receive its proportionate share of GSA real property leasing.
The Effects of Moratoria on Residential Development: Evidence from Harford, Howard, and Montgomery Counties
During the last decade, the state of Maryland was one of the fastest growing states in the United States. In response, the state has implemented an aggressive “smart growth” initiative. One of the most popular smart growth policies, adopted by several counties in the state of Maryland, is an Adequate Public Facility Ordinance (APFOs). An APFO is a spatially delineated land use control that aims to prevent development from occurring in areas where certain public services are overcrowded. An example of an APFO is a standard on elementary school capacity which limits the amount of new development at the school district level. Despite their extensive use, very little is known about the effects of these policies.
The purpose of this report is to answer the following three questions:
- What is the direct impact of an AFPO? That is, when a policy area is under moratoria, what is the resulting growth of new residential stock and how does that compare with policy areas that do not have moratoria?
- What is the overall impact of the policy? In other words, does the policy reduce total new development in the county or does it simply re-direct growth from one policy area to another?
- How much of the areas under moratorium overlap with Priority funding areas, in other words, are county land use policies in conflict with State smart growth priorities?
Presented at “Planning Reform in the New Century,” Washington University Law School, St. Louis, Mo, December, 2004
In the days following the 2004 presidential election there was much consternation in Democratic circles. George Bush won again; the Republicans picked up seats in the House and Senate; and the Republican majority seemed to have grown in depth and strength. Pundits and progressives were already wondering--could the Democrats ever recapture the hearts of an American public now apparently obsessed with security, morality, and personal charm.
Among academic and professional planners there was similar concern. Although John Kerry had never been a champion of smart growth, it was clear that the prospects for smarter growth were far greater in an administration headed by Kerry than one headed by Bush. Smart growth had not fully disappeared in the federal agenda in the first Bush administration, but the momentum had clearly waned. Further, the discussion in the planning chat-rooms and list serves focused on the blue and red maps, which made clear that Republicans dominated not only the central and southern states but also the rural and suburban areas of most every state in the union. The subject line of one long conversation on the PLANET list serve was “sprawling Republicans” which conveyed the alarm: the new American majority was deeply rooted in urban sprawl.
In the wake of these political events, it is reasonable to ask: can smart growth survive another term of President Bush? If so, what must be done to regain the momentum and capture the favor of an ever-growing conservative majority? In this period of national reflection, therefore, I consider the state of smart growth and its prospects for the near- term future. I start with a brief history of its evolution, continue with an examination of recent trends, and follow with an assessment of whether smart growth will change those trends. I conclude with recommendations for how smart growth might adapt to the new political realities.
Adequate Public Facilities Ordinances in Maryland: Inappropriate Use, Inconsistent Standards, and Unintended Consequences
The purpose of this study is to examine the implementation and effects of APFOs and the relationship between APFOs and Maryland’s Smart Growth policy. Thirteen counties and 12 incorporated municipalities in Maryland have enacted ordinances designed to assure that infrastructure necessary to support proposed new development is built concurrently with, or prior to, that new development. These Adequate Public Facilities Ordinances, or APFOs as they are commonly called, are designed to assure that public schools, roads, sewers, water for fire fighting, police and rescue response times and/or other infrastructure or services are “adequate” to support proposed new development. APFOs are timing devices that can be a useful tool for managing urban growth. When properly used, they can help ensure that needed facilities and services are available for new development and can signal to planners and elected officials what types of infrastructure, in which particular growth areas, are in need of additional capital improvement spending. They are intended to provide the rationale for prioritizing infrastructure investment decisions. As of April 2005, 13 counties and 12 municipalities had implemented APFO ordinances. In terms of categories of services included in the 12 county APFOs, all cover schools and roads. While two counties limit their APFOs to those two service categories, nine others include water and sewage capacity; three include water for fire suppression in rural areas, two include police/fire/rescue services; and one includes recreation. Not only do categories of services included in the APFOs vary, but so do a) the standards used to gauge adequacy, and b) the approaches taken by the counties when a development proposal is judged as leading to service or facility inadequacy. Moreover, APFO standards in a given jurisdiction can and do change over time as local elected officials respond to the concerns of constituents, other stakeholders and changing public policy objectives.
This study finds that APFOs in Maryland are often poorly linked to capital improvement plans, and moratoria can last for indefinite periods of time. Further, the consequences of APFOs in Maryland are often unintended and their effects frequently contrary to the broader land use policies of the state. In many counties that employ APFOs, they have become the dominant planning tool rather than just one of many tools a county might use to manage its growth.
When roads, schools or other infrastructure are judged to be insufficient to meet the standards established within APFOs, the result is often a moratorium on building until the infrastructure is ready to come on line. Often, the only way these moratoria can only be lifted is through the payment of impact fees by developers. These fees are, in turn, passed through to new home buyers. While this practice is justified by some observers as being consistent with the “benefit standard” (i.e., those who benefit from a particular service or facility should be the ones to pay for it), it ignores the benefits that accrue to the community from new development. Another perspective is that it places a disproportionate burden for the cost of new infrastructure on new home buyers. Under the latter perspective, if new development is consistent with a jurisdiction’s comprehensive plan, then it is appropriate for the funding for needed services and services be borne by the jurisdiction as a whole.
The study also finds that APFOs are applied in ways that often deflect development away from the very areas designated for growth in county comprehensive plans to rural areas never intended for growth, to neighboring counties, or even to adjacent states. An analysis of the effects of APFOs on housing in Harford, Howard, and Montgomery counties found that over a three-year period, APFOs deflected as much as 10 percent of the new home development that otherwise would have been built within the PFAs of those counties. It is likely that the cumulative effect is that the amount of housing available in those counties is reduced, housing prices are inflated, and the growth simply moves elsewhere.
APFO consistency with a local comprehensive plan is possible only if adequate funding is allocated to provide necessary infrastructure in the plan’s designated areas. That, however, is often not the case. In short, APFOs appear to be fueling the same pattern of development the state’s Smart Growth policy is intended to curtail. This result appears to be at odds with both the intent underlying the enactment of local Adequate Public Facilities Ordinances and the land use goals of the state.
Today's Vision, Tomorrow's Reality: Summary Report of the Reality Check Plus Growth Visioning Exercises
"Reality Check Plus” was the name given to a series of growth visioning exercises that were held in four different regions in Maryland in late spring 2006. The events were designed to help elected officials, government leaders, business executives, civic organizations, environmentalists and everyday Marylanders become more aware of the level and pace of growth that is projected to come to Maryland by 2030 – and to ask them think about the potential challenges and consequences Marylanders will face as a result of such dramatic change. It also was designed to encourage citizens and elected officials to think about ways to address growth issues on a regional or even statewide basis.
This Guidebook provided participants background information necessary to make informed decisions at the Reality Check Plus exercise. It contains detailed information about statewide and regional trends in population, housing, employment, environmental challenges and a range of other issues. Reality Check Plus participants were encouraged to read it prior to the exercise and bring it with them that day.
This paper presents an empirical examination of the relationship between information and communications technology (ICT) and travel. The primary research objective is to examine the effects of several indicators of ICT usage on three measures of travel outcomes. The ICT indicators include the frequency of Internet use, the number of mobile phones, and the presence of a telephone at home for business purposes. The travel outcomes examined are vehicle miles traveled (VMT), total daily trips, and daily walking trips. Using the 2001 national household travel survey (NHTS) data for Baltimore metropolitan area, a linear regression model is estimated for VMT and two Poisson regression models are estimated for, respectively, total daily trips and daily walking trips. The empirical results suggest simultaneous existence of substitution and complementarity interactions between ICT and travel, with complementarity as the dominant form. Implications of the research findings are discussed.
Adequate Public Facilities Ordinances in Maryland: An Analysis of their Implementation and Effects on Residential Development in the Baltimore Metropo
This report examines the relationship between local APFOs and Smart Growth implementation in Maryland. The overall purpose of the study is to determine whether, the degree to which, and reasons why, APFOs complement or frustrate development in Maryland’s Priority Funding Areas. This report addresses the issue through case studies of six (6) of the 13 counties in Maryland that have implemented APFOs. The six counties are located in north central Maryland, and include Anne Arundel, Baltimore, Carroll, Harford, Howard and Queen Anne’s. The case studies involved a) analysis of each jurisdiction’s APFO and its impact fee or excise tax policies (if any), and the APFO’s relationship to the local comprehensive plan; and b) interviews with county planners and with building industry professionals familiar with the county’s APFO.
Adequate Public Facilities Ordinances in Maryland: An Analysis of their Implementation and Effects on Residential Development in the Washington Metrop
This report examines the relationship between local APFOs and Smart Growth implementation in Maryland. The overall purpose of the study is to determine whether, the degree to which, and reasons why, APFOs complement or frustrate development in Maryland’s Priority Funding Areas. This report addresses that issue through case studies of six (6) of the 13 counties in Maryland that have implemented APFOs. The six counties include Calvert, Charles, Frederick, Montgomery, Prince George’s and St. Mary’s. The case studies involved a) analysis of each jurisdiction’s APFO and its impact fee or excise tax policies (if any), and the APFO’s relationship to the local comprehensive plan; and b) interviews with county planners and with building industry professionals familiar with the county’s APFO.
An Expert Land Use Panel was used to forecast the land use impacts of a major highway project in the Washington, DC area, the Inter-County Connector. What makes this panel noteworthy is the fact that a subgroup of panelists, convinced that the accessibility impacts of the highway were not being adequately considered by the majority, developed a simple land use allocation model which they then used to produce independent forecasts. This allows us to compare more intuitive and ad hoc forecasts based only on expert opinion with those based on a formal land use allocation model. At least in this case, the two differed sufficiently to suggest that the two processes are not mere substitutes for one another. This prompts us to recommend that subsequent panels be fed accessibility data early in the process to inform their intuitive judgments, and that simple land use allocation models be considered as a complement to expert opinion.
The contemporary pattern of urban development in industrialized countries is increasingly taking the form of low density, decentralized residential and commercial development. In the Chesapeake Bay watershed, which is located within the mid-Atlantic region of the United States, dispersed development patterns have been linked to habitat fragmentation and declining water quality. Our objectives were to document how this urbanization process has expanded throughout the watershed and to explore how lands comprising the natural resource base, particularly forests, have been replaced by a matrix of the built environment.
What Are the Effects of Contamination Risks on Commercial and Industrial Properties? Evidence from Baltimore, Maryland
Using the hedonic pricing approach, we investigate how the information released on public registries of contaminated and potentially contaminated sites affects nearby commercial and industrial properties in Baltimore, Maryland. We find that commercial and industrial properties are virtually unaffected by proximity to a site with a history of contamination. Knowing that the site is no longer considered contaminated does not have a rebound effect on property prices either.
We also find that urban economic development policies, such as Empowerment Zones and Enterprise Zones, have little effect on property values. In sum, brownfield properties in Baltimore are not particularly attractive investments for developers, and there is little potential for self-sustaining cleanup based on appropriate fiscal incentives, such as Tax Increment Financing. It is doubtful that “one size fits all” measures to encourage the cleanup of contaminated sites can be successful in this context.
This paper presents a GIS-based program called GISHydro2000. This tool was developed by the author and is used extensively by state government and private consultants in the development of predictions for flood behavior in the state of Maryland. This paper presents a demonstration of the program’s overall functionality and underlying spatial database. An actual example watershed will be analyzed to illustrate how GISHydro2000 works and the tools it provides.
Hydro-Ecologic Responses to Land Use in Small Urbanizing Watersheds Within the Chesapeake Bay Watershed
Urbanization in the Chesapeake Bay watershed is having dramatic impacts on the streams and rivers that feed the Bay. Increasing imperviousness has led to higher peak flows and lower base flows. The movement of pollutants and other materials to receiving waters has increased and stream water temperatures have risen. These changes alter the structure and functioning of reivers, streams, and associated riparian corridors and result in changes in ecosystem services.
We define a hydrologic disturbance index that indicates varying degrees of disturbance on a reach-by-reach basis, dependent on the aggregate amount of urbanization upstream of each reach. For current conditions this index is more variable than for future conditions, because current land use in the study watershed is more variable, containing mixtures of urban, agricultural, and forested land. In contrast, future land use is projected to be more uniformly urban, leading to a less variable but greater overall degree of hydrologic disturbance.
Two effects of urbanization on fish are explored through ecological modeling: effects of streambed disturbance on food availability and effects of stream temperature on spawning. We tabulate food availability as a function of bed-mobility for 30 different fish species. We show that additional stress occurs with additional urbanization of the watershed. We show that the urban-related increase in stream temperatures may cause several warm-water species to gain opportunities to spawn in some cases. However, combining food availability and spawning day availability into a single index reveals highly stressful conditions for all fish species under the fully developed scenario.
Can City Lifestyle be a Catalyst for Smart Suburban Change?: A Comparative Investigation into How Asian and Latino Immigrants’ Prior Urban Experiences
The research investigates how Asian and Latino immigrants’ prior urban experiences can inform the future planning and growth of suburban communities in Maryland. The investigation of Maryland immigrants’ various built environment (dwelling, landscape, neighborhood, transportation mode) preferences will result in a set of ecologically appropriate and culturally sensitive design guidelines that will help shape the future of the rapidly growing suburban communities.
Pedestrian safety is emerging as a major area of concern for MPO's and planning agencies. Typically, pedestrian safety has been analyzed by either examining the absolute number of pedestrian crashes at a location, or computing an exposure rate from the number of crashes and the traffic volume. A more desirable measure would be an exposure rate based on the pedestrian volume, but it has not proven feasible to obtain pedestrian flow volumes on a widearea basis to support this analysis. This report describes a pedestrian flow modeling process that was developed under the sponsorship of the Maryland DOT and the University of Maryland National Center for Smart Growth. The process provides micro-scale daily pedestrian flows on all sidewalks and crosswalks in a substantial coverage area. Two test cases were analyzed: an urban scenario comprising about 10 square miles of downtown Baltimore, and a suburban scenario comprising about 15 square miles of Langley Park in Prince Georges and Montgomery Counties.
Planning and Development Control at the County Level in the United States: Lessons from Montgomery County, Maryland, and Fairfax County, Virginia
This report provides an overview of planning and development control at the county level in the United States based on a case-study analysis of two counties in the Washington, DC metropolitan area: Montgomery County, Maryland, and Fairfax County, Virginia. The intent is not to provide an in-depth analysis of the differences between these two counties but instead to demonstrate general principles and procedures of county planning in the United States.
Maryland is a dense and rapidly growing state. For this and other reasons, Maryland has been a national leader in a movement known as smart growth. Smart growth has many objectives, but concentrating urban growth in well defined areas while protecting rural land from development are perhaps its primary goals. Though public support for smart growth continues to rise, so do concerns that policies used to promote smart growth could have adverse effects on land and housing markets. To evaluate these concerns, this study provides information on housing markets and development trends in the Baltimore-Washington corridor.
The study finds that housing demand in the nation and in Maryland is strong, as revealed by rising prices and homeownership rates as well as by falling vacancy rates and housing-to-jobs ratios. In general, the housing market in Maryland exhibits trends similar to those in comparable jurisdictions, such as neighboring Virginia. The performance of specific housing markets in Maryland, however, varies widely, with strong growth in the suburbs, variable growth in rural areas and persistent weakness in Baltimore City. Further, in the Baltimore and Washington suburbs, housing prices are rising rapidly while housing starts remain sluggish.
Though this study does not prove that housing markets and development trends in Maryland have been adversely affected by land use policies, there is evidence to suggest that state and local constraints on development are contributing to problems of housing affordability and deflecting growth to outlying areas. The result could be more, not less, urban sprawl. Moreover, neither the state government nor most local governments in Maryland currently have adequate policies in place to monitor or address this problem. While the Maryland Smart Growth initiative has been successful in protecting natural areas and agricultural lands from development, it has not had similar success in assuring a steady, future supply of affordable housing. Local governments, meanwhile, appear to have little incentive to address this problem.
To address this problem the state needs to assure that local governments address development capacity and housing affordability issues. This does not mean it should eliminate or immediately expand Priority Funding Areas. It does mean that the state should require local governments to include housing elements in their comprehensive plans, provide periodic estimates of housing and employment capacity, and develop modern and publicly accessible data on the location and capacity of developable land. Local governments must be active and willing participants in this process and the Maryland Department of Planning should provide whatever technical assistance may be needed.
Increasing awareness about the problems brought on by urban sprawl has led to proactive measures to guide future development. Such efforts have largely been grouped under the term, Smart Growth. Although not widely recognized as such, the smart in Smart Growth implies an optimization of some quantity or objective while undertaking new forms of urban development. To illustrate a formal, quantitative framework for Smart Growth, this study develops definitions of optimal development from the perspectives of four different types of stakeholders: a government planner, a land developer, a hydrologist, and a conservationist subject to certain developmental constraints. Four different objective functions are posed that are consistent with each of these stakeholders’ perspectives. We illustrate the differences in consequences on future development given these different objective functions in a stylized representation for Montgomery County, Maryland. Solutions to Smart Growth from the individual perspectives vary considerably. Trade-off tables are presented which illustrate the consequences experienced by each stakeholder depending on the viewpoint that has been optimized. Although couched in the context of an illustrative example, this study emphasizes the need to apply rigorous, quantitative tools in a meaningful framework to address Smart Growth. The result is a tool that a range of parties can use to plan future development in ways that are environmentally and fiscally responsible and economically viable.
Does Job Creation Tax Credit Program in Maryland Induce Spatial Employment Growth or Redistribution?
The Job Creation Tax Credit (JCTC) program is one of the five major Smart Growth Programs initiated by the State of Maryland in 1996 and amended in 1997. Like other tax credit programs it is intended to create jobs, but it is also a place-based policy in the sense that eligibility is limited to jobs created in Priority Funding Areas (PFAs). This paper examines whether the JCTC program has furthered the goals of smart growth by concentrating job growth within well defined regions of the state. Towards this end, both the number and the relative share of employment inside and outside of the PFAs are compared using three econometric models. The empirical analysis examines employment in five economic sectors ((1) primary, (2) manufacturing, (3) transportation, communication and utilities (T.C.U.), (4) finance, insurance and real estate (F.I.R.E.) and (5) services) over the years (1994 to 1998) using ZIP Code data. The result shows that jobs in the T.C.U. and services industries have responded to the state incentive program while three other sectors have not; the distribution of jobs in the primary sector have grown counter to the state incentive policy and jobs in manufacturing and F.I.R.E. have been unaffected by the program.
An Analysis of Social Equity Issues in the Montgomery County (MD) Transfer of Development Rights Program
Transfer of development rights (TDR) programs increasingly are being utilized as land preservation tools in local jurisdictions' growth management strategies. Issues of social justice are embedded in TDR implementation. This article develops a framework for analyzing social equity issues in TDR programs, and applies the framework to the program in Montgomery County, Maryland. While the Montgomery County program has gained a national reputation for protecting large areas of farmland, the social equity analysis finds several shortcomings with that program's design and operation. Recommendations are offered for improving the effectiveness and equity of the program, and these suggestions have implications for other TDR programs.
This paper examines if information technology has worked towards dispersion or concentration of economic activities in two steps of analysis. The first analysis using locational Gini coefficient and Moran’s I focuses on distribution of the urban area as a whole and finds that dispersion was prominent over the years. The second analysis using Gi* statistic as the dependent variable in the regression model, however, shows that the technology has induced more concentration rather than dispersion at an intrametropolitan scale, reflecting that there is a discrepancy in the results of the two analyses depending on the spatial scale of the analysis.
This study tracks the remediation history and redevelopment on three brownfield sites in Baltimore, Maryland. The sites are Camden Crossing, Highland Marine Terminal, and Crown, Cork, and Seal. The first project, Camden Crossing, promises to turn previously industrial property into a town house development. Highland Marine Terminal and Crown, Cork, and Seal were industrial sites transformed into warehouse space. The proposed residential, Camden Crossing, project has met with continuous impediments and delays, and is now running more than eight years behind schedule. The two industry to warehouse sites can be characterized as successful, with profitable enterprises now operating on both. The factors that appear to compress risk and contribute to successful brownfield redevelopments are continuous industrial use, a strong market for the final use, and quick movement through the Phase I and Phase II testing, Maryland Department of the Environment approvals, and reuse. The continuous industrial use means that cleanup standards are not as stringent as for residential use, thereby speeding cleanup and lowering remdiation costs. Moreover, an uncertain market for the final product increases risk. For example, the warehouse market in Baltimore is much stronger than the residential market. The weak residential market in combination with stringent cleanup standards undermines the profitability of Camden Crossing. Finally, the delays in Camden Crossing have both resulted in and been further aggravated by changes in the Maryland Department of the Environment staff. Over the eight years the project has been under discussion, the Maryland Department of the Environment has revised and made cleanup standards more strict.
Prepared for Presentation at the International Workshop on Urban Growth Management: New Approaches to Land Management for Sustainable Urban Regions University of Tokyo, Tokyo, Japan, 29-31 October 2001
Smart growth is a term rising rapidly in use and ambiguity. The origin of the term is uncertain, though some credit Harriet Tregoning, former Director of the Development, Community and Environmental Division of the U.S. Environmental Protection Agency (USEPA) and now the smart growth Czar in the cabinet of Maryland’s Governor Glendening. Even if fiction, this story has a certain allure, since the USEPA and the State of Maryland have done much to make smart growth an agenda item of many states, local governments, and interest groups. Despite its popularity, however, the concept of smart growth remains ephemeral. Much has been written about smart growth in the popular press and newsletters of advocacy organizations, both pro and con, but little has been written about it in the academic literature (early contributions include Burchell et al. 2000, Downs 2001, and Nelson 2001). As the newly appointed Director of Research for the National Center for Smart Growth Research and Education at the University of Maryland, it will be my job to do just that -- not just with papers of my own, but with papers written by scholars with a variety of disciplinary backgrounds. This paper, therefore, represents a first step towards that end. But my goals for this paper are more ambitious; they include the articulation of an agenda for research on smart growth. This is a formidable task, since the ambiguity of the term leaves little in the realm of land use to eliminate as beyond the scope of the subject. To narrow my scope, therefore, I ignore all discussions about what constitutes urban sprawl and whether sprawl, however defined, is good or bad. Instead, I focus my analysis on smart growth policies adopted by the State of Maryland.
As in many countries around the world, concerns about contemporary urban development patterns and their effects on the natural and social environment are high and rising in the United States. Though these concerns are not new, the recent period of sustained economic growth has led to both rapid urban expansion and falling relative concerns about other problems like crime, unemployment, and government deficits. Urban sprawl is now a major public policy issue (U.S. Office of Technology Assessment 1995, U.S. General Accounting Office (GAO) 1999, GAO 2000).
How to address -- even define -- the problem, however, remains unresolved and contentious. Some view urban sprawl as a major threat to environmental quality, fiscal stability, and human health. Those with this point of view support policy reforms sometimes called smart growth, new urbanism, and sustainable development (Ewing 1997, Smart Growth Network 2002). To others, sprawl is simply the result of increases in population, rising real incomes, and the expression of consumer demands (Brueckner 1999). To those with this point of view, there is little evidence that urban sprawl has adverse social or environmental consequences or warrants a policy response (Gordon and Richardson 1997, Urban Futures 2002). In a nation rich in land resources and steeped in traditions of private property rights, this view is not easily dismissed.
More than 110 state and local governments have implemented agricultural land preservation programs to permanently preserve farmland. Assigning a value to the development rights to determine the cost of acquiring an easement on farm properties is difficult and can be costly. Data was collected on 409 preservation transactions from three Maryland counties and supplemented with farm-level spatial data via GIS. A hedonic price analysis is conducted to determine the marginal return to different farm characteristics using a spatial econometric model to correct for spatial correlation. Parcel characteristics such as distance to city and town, number of acres, prime soils and current land-use explain 80 percent of the variation in easement values. As expected, characteristics perform least well in explaining easement values in transfer of development right programs. This information can help formulate policy decisions and selection criteria to maximize the preservation of the agricultural economy and/or maximize public preferences. A supply curve is constructed using simulations that determine nonparticipant parcels’ easement values. To preserve the remaining eligible acres in the three counties, $167 million would be needed. This method can support programs choosing to use a point system rather than the more costly and difficult-to-apply standard appraisal methods.
Using a Studio Course for Provision of Smart Growth Technical Assistance: The University of Maryland’s 1999 Community Planning Studio in Perryville, M
As a faculty member in the University of Maryland’s Urban Studies and Planning Program, in early 1999 I decided to have my summer, community planning studio course focus on the challenges facing one of Maryland’s smaller jurisdictions at it attempted to comply with its planning mandates and grow in a manner consistent with the state’s Smart Growth program. The resulting 2 summer studio course, entitled “What’s Smart Growth for Perryville?”, proved to be a rich learning experience for the students and a valuable resource for the town. This chapter focuses on how the 1999 summer studio course provided smart-growth related technical assistance to the Town of Perryville. It will provide a brief profile of the studio course and of Perryville; discuss how the students approached the study; summarize the major findings and recommendations of the final studio report; critically analyze the degree to which the report has since been utilized by the town; highlight the students’ reactions to the studio experience; and discuss the lessons learned from the studio and the studio’s potential transferability.
Local and state governmental entities have implemented transfer of development rights (TDR) and purchase of development rights or purchase of agricultural conservation easements (PDR/PACE) programs to permanently preserve farmland throughout the United States (AFT (American Farmland Trust) 2001a; AFT, 2001b; AFT, 2001c). In each of these programs, the sale of development rights results in an easement attached to the title of the land which restricts the current and all future owners from converting the parcel to residential, commercial, or industrial uses. The value of the land in alternative uses affects an owner’s willingness to participate in these programs as well as the program costs. Thus, information on the value that the private market places on parcel characteristics is important in determining participation behavior and payment levels. In addition, knowledge of the marginal contributions of different parcel characteristics to both private market prices and easement values can help program administrators decide which easement purchases can maximize society’s benefit at the lowest cost.
Lynch and Lovell (2002) found that the agricultural land preservation programs in three Maryland counties (Calvert, Howard and Carroll counties) paid higher per acre easement values for farmland close to the nearest employment center, smaller farms, and farms with a high percent of prime soils, and paid lower values for farms with a high percent of cropland. The importance of certain land characteristics on the easement values was affected by the type of agricultural preservation program (TDR or PDR/PACE) that had enrolled the farm. In an analysis of whether or not the easement restrictions affected the preserved parcels’ market price, Nickerson and Lynch (2001) examined private market sales prices for 200 farmland parcels in the same Maryland counties (Howard, Carroll, and Calvert). They found that the private market paid higher prices per acre for farmland close to the nearest employment center, smaller farms, non-forested parcels, and those parcels in Calvert and Howard counties. They found that prime soils were not important in determining the parcel price in the private market. Comparing the results of these two studies, we find both similarities and differences in the effect of different characteristics on easement values and private market prices for agricultural land.
This chapter explores these similarities and differences by investigating whether the private land market pays similar values for parcel characteristics or whether the preservation programs design payment schemes that are not market-driven. Analyzing a spatially explicit dataset of 2,592 arm’s-length transactions, we also correct for possible spatial correlation that might occur due to the proximity of the observations to one another. We also include parcels that are no longer in an agricultural use. By examining the local market for land, we can determine if the easement value indicated by the supply curve of eligible land to be preserved based on the easement programs’ payments is comparable to the prices received by recently sold local land.
In 1997, Maryland burst into the national spotlight with a package of legislation collectively referred to as smart growth. At its core, the innovative Maryland approach relied on directing state investments in urban infrastructure to Priority Funding Areas while directing state investments in land preservation to rural legacy areas. This article examines the performance of Rural Legacy Areas. Although smart growth in Maryland and the performance of Priority Funding Areas have received considerable attention at the national level, there have been few analyses of the performance of the Rural Legacy Program.
Lewis and Knaap find that the performance of Rural Legacy Areas has been mixed. The level of state funding has varied tremendously, and few areas have received consistent funding over time. In areas where the state has targeted high levels of funding for several years, however, development in Rural Legacy Areas has been tempered. Overall the share of development in Rural Legacy Areas measured in parcels has increased slightly, but the share of development measured in acres has decreased slightly.