Paying for Infrastructure

One of the most constant points of discussion in our (and other) region is infrastructure. We need it, but no one is willing or able to pay for it.

From the WP:

“I think we’re finally coming to a place where growth is sustaining growth,” Fitch said, explaining that housing developers seem increasingly willing to pitch in to compensate for the stress on infrastructure caused by new residents. Centex’s contribution would amount to nearly $74,000 per unit, more than double what Fauquier County usually receives from a developer.

But development specialists say the unusually large promise of cash highlights a disturbing trend in Virginia’s booming housing market. Developers eager to plant new homes in exurban locales are building roads, establishing parks and offering money — all in an effort to appease increasingly resistant communities. The result, the specialists say, is more expensive homes.

Regarding the Annadale development in Orange:

Recently, Silver dropped the density to 290 units and raised the proffers to $25,000 per home to make the project more favorable to the supervisors. It worked.

Albemarle’s proffers have traditionally been far less.

The Greene County Board of Supervisors last week determined that the base amount for all future proffers (policy to be reviewed every year) that, going forward,  will be $5,562 per home.

One of the most insightful remarks from the WP article was this, by the representative from the Urban Land Institute:

And in the end, it will be the homeowners who pay the price, said McIlwain, who added that it is these kinds of agreements that drive home prices skyward and suburban sprawl farther and farther into rural Virginia.

Bottom line: somebody has to pay for the infrastructure improvements. The argument continues to be, “so long as it’s not me.” That has to stop.

More more on how this ties into the over-reaching transportation policy, I direct you to this post and discussion at Bacon’s Rebellion.

Might the fact that we are plodding our way towards gridlock be a reason that we are no longer in the Top 100?

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1 Comment

  1. Ray Hyde July 20, 2006 at 15:59

    In Sunday’s Post was a front page story about the record proffers and other requirements an developer agreed to in order to build in Warrenton. In the discussion the comment was made that the only people not at the table were the people who would be forced to live someplace else as a result of the astronomical prices the proffers would cause.

    And the proffers are only part of the story because that is just the cash portion of the proffers. Here is a case where the developer is going to be required to use only 25% of his land, with the rest held in reserve, forever. He will pay a record cash proffer of $74,000 per home, and he is limited in the number of homes he can build even if he is willing to pay such a high proffer. He will repair the sewer system that the rest of the community has let fall into disrepair as a result of not paying enough taxes to fix and maintain it it. He will build the homes to look the way the board wants them to look, and in spite of that, he will be reqired to build them behind a berm or ridgeline so the community won’t have to see them. the reason is so that they can continue to have “their viewscape” at the entrance to town. And, after all of that, he will be required to sell the homes only to a limited market of childless people over 55 years old. The cash proffers will go to build a giant recreation center to be used by people in the rest of the town who do have children.

    All of this negotiation is going on with a developer who doesn’t even own the land, yet. The landowner, who has done much for the town in the past, is a hapless bystander in all this. Her desires and those of her deceased husband have been trampled over for years by a footdragging government. At the rate things are going she may be deceased before she gets her money.

    Does that sound even remotely like a free market? You don’t have to look very far to find someone who is promoting and enforcing policies that amount to requiring someone else to do what they want done instead of what the person doing the work wants done, let alone what the owner wants done.

    This is being promoted as a major victory for the town. It may yet turn out to be the snake in the grass that drags them down by the ankle. The mere fact that it is being promoted as a victory shows the kind of antagonism, and even coercion, that has resulted in a process that ought to be co-operative.

    The Post commentator that called this bribery was being kind. A bribe is a gift that is both given and received with the expectation that it will result in a change in behavior. Extortion is money coerced by force of superior power.

    What is going on in Warrenton is simply wrong. It is the kind of behavior that distorts the market and casts uncertainty on the value of what you own. If it continues, it will be bad for all landowners and homeowners, not just developers.