The Return of the City State - Galt's Gulch

City State - Old Model

Who would have thought the newest and most remarkable innovation in city planning may come from Honduras. There, the Honduran president, Porfirio Lobo has given his full backing to an idea to build new cities that are outside the laws, tax system, judiciary and police of the country. The goal is to turn around their disastrous economy by allowing less restrictive growth and development in new areas of the country outside the specific control of the government. Millions have been pledged by an investor group. (GO HERE for the Guardian article)

Much of this is based on the ideas of Paul Romer, a professor at the Stern School of Business at New York University. He calls these “Charter Cities” and cites examples such as Dubai, Hong Kong, and Singapore. Good company if you can make it work. There are no scratch recipes available to make these experiments work. But there are some things going for it – but now after a lot of negative reactions, Romer has issues with much of what is planned – or he’s lost control, not sure which. A lot of this sounds strange and interesting at the same time. Who are the developers, why give up such control, and how will you employ (as the developer says) 45,000 people in less than three years?

As a planner, I know that the greatest difficulty many new communities face is integrating new neighborhoods into the existing urban framework. And this means both physically and politically. Every city I have worked in sees these new neighborhoods as sources of revenue to fix existing infrastructure, schools, and transit problems. From the start these new residents are saddled with a disproportionate amount of fees to covers bonds to build the community itself, fix adjacent roads, and repair old and tired sewer and water systems. The new community’s success is often marginal, and during bad times, like the last five years, disastrous. This Honduran model is new and dangerous, bold ideas are always a threat to someone.

Already declared elitist and for the rich, the usual forces are mustering to fight these attempts to bring some better level of housing and business growth to one of the most unsafe countries in the world (its murder rate is one of the highest). And if there is one thing that scares off businesses and developers is murder and kidnapping. But businesses do employ people who may then begin to have a better standard of living. Sometimes you have to do things that are remarkably different to be successful – witness the threatened entrepreneur in America and their fight for deregulation and creative freedom.

The usual canards are thrown out about forests and agricultural frontiers (read subsistence farming). Indigenous peoples are threatened, cultures will be lost. Possibly. But then again poverty and social collapse have significant impacts on these people and cultures as well – maybe more so.

The Socialist Party, a Marxist blog/news site (it calls itself Marxist), claims that it is just another attempt by the Honduran elite to crush worker’s rights. (GO HERE) They even mention Bain and Company as a consultant to the group (and they throw in Mitt Romney’s name for spite). It is better to be a citizen of a failed country, living in fear, than an employee in a safe environment, I guess.

The primary developer is MKG and its idealistic libertarian Michael Strong. The government/management structure, as noted in the New York Daily News.Com is:

Daily operations will be administered by a board of governors.

Those governors will establish the rules and laws of the city, and future legislation will be subject to popular vote, said Michael Strong, CEO of MKG.

Hondurans will be allowed to live and work in the cities — which Strong says will be home to textile manufacturing, product assembly and outsourced businesses, like call centers.

"Once we have jobs, then we will need affordable housing, schools, clinics, churches, stores, restaurants, all the businesses that create a real community," he told the AP. (GO HERE)

Here is a blog that may have more information – but I am not sure of its validity, (GO HERE) One my favorite magazines Fast Company, has this interesting take on the story (GO HERE).

Notwithstanding the controversial aspects of something like this, this is a concept and something to ponder. How would such an entity survive in the Californian structure of urban plans, general plans, statewide development studies, urban boundaries, and urban limit lines? It is virtually impossible to start a “new” city almost anywhere in the United States. It would be seen as a threat to any existing city, county or state. Laws of your own? Management of employees outside the current labor accords? Schools run by private organizations? And most probably non-union? I find it fascinating – so Galt’s Gulch (for the Rand insider only).

Italy was such a land of city states until the end of the 19th Century; it took a civil war to bring Italy together. I will keep an eye out on the goings on down south, a land not unknown to civil wars.

Stay Tuned . . . .

Noodling for March

I thought to start out this end of the month’s Noodle I would throw out some quotes on the process of city planning:

You got to be careful if you don't know where you're going, because you might not get there.

- Yogi Berra, baseball catcher (1925-present)

In our profession, a plan that everyone dislikes for different reasons is a success. A plan everyone dislikes for the same reason is a failure. And a plan that everyone likes for the same reason is an act of God.

- Richard Carson, Pacific Northwest planner and writer.

Planning lies with men; success lies with heaven.

- Chinese proverb

There are some people who live in a dream world, and there are some who face reality; and then there are those who turn one into the other.

- Douglas H. Everett

In Houston, a person walking is someone on his way to his car.

- Anthony Downs, writer

Long-range planning works best in the short term.

- Euripides, poet (480-406 AD).

A hundred years after we are gone and forgotten, those who never heard of us will be living with the results of our actions.

- Oliver Wendell Homes, U.S. Supreme Court justice

The best way to predict the future is to invent it.

- Immanuel Kant

Any town that doesn't have sidewalks doesn't love its children.

- Margaret Mead

The home is where part of the family waits until the others are through with the car.

- Herbert Prochnow

The outcome of the city will depend on the race between the automobile and the elevator, and anyone who bets on the elevator is crazy.

- Frank Lloyd Wright, architect

Boomers and Home Sales:

One result of the Boomer Generation is that at some point during the next ten years a significant number of homes will be coming into the resale market. If this coincides with some reports that the younger generation isn’t in a buying mood then, on top of the current foreclosure issue, we could be faced with numbers of larger homes that will be asking more than the marketplace can bear. When this change comes or even if it comes remains to be seen. US Business: GO HERE.

Tesla and the Brick Issue

The latest issue of Fast Company magazine (actually quite a nice rag on cool high tech and the people behind it), goes into the brain of Elon Musk and Tesla Motors and tries to break it down. A very good article that explains a lot about Tesla, the new Model S car, the engineering, and the dream. I am a skeptic as long as the industry must have government subsidies to succeed, but I’m no fool when it comes to technological advances. As in a lot of things it will be the third investor that makes the money (GO HERE). And BTW they never do answer the question about the batteries turning to a brick if it loses its charge entirely.

Home Sales Up, Down, Sideways, No One Knows

In the San Francisco Bay Area, especially in and around Silicon Valley prices for high end homes are being bid up and up. Foreclosures continue on homes not more than fifty miles away and are selling for one tenth the prices in Santa Clara County. It is all a mish-mash of bank financing, Google and Facebook money, and no one has to mention Apple. Low and moderate income home sales are limping along, there are ongoing arguments over “required” affordable housing issues, and does increasing interest rates push up housing demand (the fear of being left behind syndrome)? For a bit more go HERE and HERE for a taste of the vacation home market.

In Memory – Edna A. Davis

And lastly, on a personal note, this week we lost a wonderful woman who was the quiet anchor to our family. My wife’s mother, Edna A. Davis (nee Peak), passed away. This woman was 98 years old. She supported her daughter and herself for most of their early days and then for herself as she grew older. She was a beautician and hairdresser, I never saw her with one hair out place and even after a stroke and other health issues she was always dressed in style. Think about this: when she was born in a small Ohio town in 1913, the Wright brother’s flight was only ten years earlier, Woodrow Wilson had just been sworn in as president, and half the country still had no electricity, telephones, and indoor plumbing. Edna watched the Great War as a child and feared for her brothers fighting in France during World War Two. One of thirteen children (a brother died in 1902) she watched an America change for the better and for the worse. In the her twenties Cleveland was an world industrial powerhouse with the likes of Ryerson Steel and the growing automobile industry, now dried newspapers blow through its empty neighborhoods. Her small town of Avon is now a typical suburban tract of widened roads, strip malls, and affluence. She was a proud and incredibly strong woman; she is the best example of an independent American woman I will ever know. There was always a proud softness about her that hid the tragedies of her life. We will miss her very much.

Getting out of Dodge

I have always believed that the American citizen wants the following: “The biggest house on the biggest lot that they can afford.” Simple isn’t it. And this is in complete sympathy with the fundamental law of good economics: “The market is supreme.”

Why then are we continually bombarded and chastised by do-gooders and New Urbanists who firmly believe that we are on the road to perdition and our just end by living in single family homes in the suburbs? In Joel Kotkin’s rebuke of two op-ed pieces in the New York Times touting the decline of the suburb HERE, he chastises their tenets as “more a matter of wishful thinking than fact.” Yes it is more than wishful thinking on both Chris Leinberger HERE and Louise Mozingo’s HERE part to believe (almost over-passionately), that they will be proved right and the “fringe suburb” and the suburb itself will go the way of the dinosaur.

In both of their arguments they blame the architecture not the economics. The blame the suburbs and the unenlightened, not the marketplace. And to use the excuse of climate change is just plain lazy thinking. And Ms. Mozingo, what the hell is pastoral capitalism? I must have missed that economics lecture. After reading both Leinberger’s and Mozingo’s diatribes I swear I have been pushed back to planning classes of 1970 when Denise Scott Brown, Robert Venturi and Vincent Scully’s musings on Le Corbusier’s fascistic views on urban redevelopment and Las Vegas chic were the rage, Edmund Bacon was required reading on Philadelphia, and Paolo Soleri’s dreams of human anthills were at museums of modern art. Save the world – go vertical.

The average American (and I’m sure far more than 50%) distrusts cities. They see criminals and civil discourse. They see danger and are fearful. They see uncontrolled costs, poor management and excessive tax burdens. Sure they go into the city centers during the day to the museums and to shop but they get out of Dodge before the sun sets. That’s one part of the problem with the current foreclosure issue, fear. Many took advantage of this opportunity to escape and then, combined with stupid lending practices and the collapse of the economy; these otherwise sane people were put in jeopardy.

Urban areas have higher concentrations of voters (obviously) and where there are voters there’s politicians handing out money. Billions of dollars flow into the cities - much without reason or control. So we now have Lexus cities that can’t afford to put gas in the tank. The most current gross excess is the high speed rail that is planned between dense urban areas while ignoring the suburbs it will fly through. Transit only functions both economically and operationally in higher density urban areas, thus to believe that density is good is to justify the outrageous cost per user that will saddle the general public - who live in the suburbs. The market thumbs their nose at these ideas.

EVERY land use is temporary. Every castle, hovel, office tower, office complex, stadium, single family housing tract is temporary, it is only a matter of time. Even the billion dollar cyclotron office building proposed by Apple will be knocked down some day. Every ring of urban growth “fringe” eventually becomes an inner ring of decayed housing ripe for redevelopment Cool Example.  I have planned residential communities on lands that were once insane asylums and office complexes (don’t read anything into that statement). Well planned money goes to where there is the best return; a new freeway interchange may affect thousands of acres and foster growth. A new sewer plant allows for more effective suburban planning, while also clearing up environmental problems.

And what is urban anyway? Every planner and politician has one idea and every home buyer and family has another. The debate is not an architectural one it’s a social issue. It is a debate on the automobile and its attendant demons; it’s an attack on the politics of these suburban residents, and it’s a reaction of their collective “thumbing of the nose” toward the academics.

Yes Virginia, believe in the market and the demographics.

Stay tuned . . . .

Re-Urban Balance – The Quest for the Future Downtown

I live in a delightful small town twenty-six miles east of San Francisco. The village was once a Spanish ranchero, that beget cattle ranches, that beget walnut and fruit orchards– hence the name Walnut Creek – that beget housing, that beget freeways, that beget BART (regional transit), that beget a regional crossroads, that now has beget one of California’s most successful urban retail and commercial developments. Sounds almost biblical.

I remember during an Urban Land Institute presentation a number of years ago, a past mayor of our village remarking, as a part of a panel I was moderating, about a regional mayor’s conference she attended. “Well, the mayor of Alameda walked up to me all puffed up and said they had just acquired a Trader Joe’s, well I said congratulations, we haven’t achieved anything so large in our down town, we just got Tiffany’s.” Yes, size sometimes does make a difference. Trader Joe’s is a go to and leave store, Tiffany’s is contagious like a plague (the good kind), it will infect every store and building owner. It will bring more buyers to the downtown, all profit.

The difficulty with much new urban (faux-retail) development is its lack of history, variety, and texture. I am always looking for friction in my designs, things rubbing against each other, close by shops, near and available parking – (but not too much - it can push apart uses and lose friction), a broad mix of retailers and restaurants. It’s extremely difficult to achieve this in a new retail center, and almost impossible in the old enclosed mall. We are lucky here in Walnut Creek.

While this is, and all downtowns are, in a constant state of renewal through creative destruction (stores fail, owners lower and raise rents, cities try to nudge land uses around such as restaurants and retail, and developers try to find the best mix for their centers), Walnut Creek is lucky to have a broader rental base and a diverse number of building owners. Ain’t completion great!

The old part of town was a classic California “valley” town. Main Street flanked by mostly one story buildings (most insubstantial), somewhat narrow sidewalks, adequate parking (for 1930), and a low surrounding population. But now the town sits at the intersection of two major freeways and a regional transit center with BART. The streets have trees that stand fifty to sixty feet high and as each old building is renovated, new walks and street improvements are made. The city has built discrete parking garages with retail and restaurants on the street, and, most importantly, supported the expansions of the Macerich urban mall on the south side of the downtown core. There is a symbiotic relationship between the north and south sides of the downtown core, the old and the new, the large floor plates to the south and the privately owned shops and stores to the north. Restaurants are tucked between things, there is the beginning of a good sidewalk restaurant trade, and there is enough of a downtown to make a day of it – not just drive to, shop and leave.

New retail centers try to build in history and texture, it’s almost impossible to achieve. A new car takes fifty years to be a classic, and not all classics are high-end, the ’57 Chevy Belair was the vanilla of its time, it now turns heads. It’s tough to achieve maturity and success. But with an older and very competitive area of the downtown mixed with the draw and high end values of the Macerich portion, the downtown is richer and more exciting. There is now a night life (go find that in your downtown), there is Nordstrom, a new Forever 21, a Neiman Marcus will open soon, an Apple store with its usual customer line outside each morning, and some really, really great food.

I’m reminded of the old Yogi Berra comment, “Nobody goes there anymore, it’s too crowded!” That can be said for our downtown, everyone complains about the traffic and lack of parking, as if that’s a bad thing. Would you want to own a business with no traffic problems and plenty of available parking right outside your front door? I was discussing downtowns with a city planning director of a community near San Jose, he was charged with creating a downtown out a disparate jumble of strip malls, regional centers, and six and eight lane main streets. He had no traffic or parking problems anywhere. “I would kill for a traffic level of F,” he said. “But if I said it, I’d be fired.”

There’s the rub, or lack of it.

Stay tuned . . .

Centrist versus Decentrist – The Future of American Growth

I apologize right up front that this posting may be a bit disjointed – but the following bits are my initial thoughts in an rough attempt to get my arms around the subject of where growth will occur in the United States during the next fifty years. It is a personal view – but based on a lot of experience.

There are today two broad schools of thought on American growth. The first says we must return to the cities (use force if necessary), reuse and revitalize our urban centers, densify, and above all use transit to make this all happen. These are what I call Urban Centrists. The second school is certain that most of the new growth necessary to absorb the next 100 million Americans has to be in the outlying suburbs and small towns across the country. These are the Rural Decentrists.

I am a Rural Decentrist.

The growth of suburban and urban areas since the end of World War II has continued to feed this discussion to the point of rabid reaction and political leveraging. These schools have had their champions and buzz words. To mention a few: Transit Oriented Design (TOD), Traditional Neighborhood Design (TND), Edge Cities, New Urbanism, Neo-Traditional, Sustainable Development, Penturbia (the 5th Internal American Migration), Satellite Towns (a Cold War remainder?), Greenbelt Communities, and one of the most curiously recent, New Pedestrianism. Billions of dollars have been spent and made in each camp promoting and building their view, like Ebenezer Howard and Raymond Unwin one hundred years ago, of the Utopian community.

Each has their intrinsic value and success stories. The neighborhoods and villages built and reconstructed on the New Urbanist model are excellent examples of low density, mixed-use neighborhoods; their long term viability is yet to be determined. But it is safe to say they are very expensive and, for some, elitist in their maturity. These concepts are strong — their execution expensive.

Decentrist neighborhoods tend to be sprawling (there is that word) and are areas of growth connected to existing communities and towns. They are more affordable, adaptable, and accessible to more people. While not paradigms of planning in their choc-a-block layouts and executions they meet the most important need – demand. And yes this can lead to excess (witness the current housing mess), but the community designs are not the reason for their collapse.

The fundamental flaw of each school is that old bugaboo, the marketplace. People can only rent or buy what they can afford (except the last few years). As land values increase (usually closer to urban centers) the costs to develop and build increase, sometimes substantially. The result is higher and higher housing costs. To counter this affect either units get smaller, densities rise, heights increase, or they become too expensive. The increase in price directly affects who buys and where. While the European model works (the expensive and really nice housing is downtown) for Paris, London and other old-world cities I suggest, quite strongly, that that is not the traditional American model.

The American housing model and its attendant marketplace is unforgiving – look at the current rates of foreclosures. Many foreclosures were based on the attempt to subvert the marketplace with political incentives (tax rebates, subsidies, and outright grants), others through fraud and deceit. I do not include those that face foreclosure due to illness and job loss — the market already includes these difficulties in its traditional model.

The rural decentrist model begins with a significantly lower basis in the land cost (land costs within a few miles of Urban Growth Boundaries can be 10% of the inside land values). Approval costs are less, utilities are significantly easier to build and the costs of labor - lower. No matter how loudly the centrist school stomps their collective feet; they cannot come close to offering the same competitive product to the marketplace. The urban areas do offer a more diverse society, more arts, more distractions, finer stores, restaurants, and even more and better opportunities for employment — but it is not a moral issue.

To attribute and/or apply a moral aspect to this growth is just wrong. This castigation continues to appear in articles and even books that espouse one form of development as intellectually and morally superior to others. Phooey. There is good development and bad development; there is profitable development and there is unprofitable. The marketplace takes care of the bad and unprofitable in a very unforgiving manner. Developers with high standards. imagination, and community spirit will continue to develop excellent projects no matter where they are located. And there will also be a lot of junk foisted on the public covered with sustainable green neo-traditional transit oriented worker’s housing labels (SGNTTO&WH).

There are state and national efforts to change how we grow through political muscle and legislation. These regulations fight the marketplace and its simple needs. They will become very costly and take revenues from more important community needs. I suggest a time-out, a sideline breather — put your hands on your knees and take a breath.

Off to Chicago tomorrow for a presentation and book signing in Park Forest, Illinois. Talk with ya’all next week.

Stay tuned . . . .