How to Solve All of Our Problems

You know the story about the greek philosopher and the bathtub, yes? I had one of those moments last night at the Medeski, Martin, and Wood show at Starr Hill.
As part of my work with Charlottesville Tomorrow, and to a degree with ASAP, I've been spending a great deal of time watching (with horror) the development trends in Albemarle and surrounding counties. We are being strangled with urban sprawl, ladies and gentlemen. Albemarle's good-intentioned efforts have staved it off somewhat, at least in the county, but it seems to just be rolling out into Greene, Fluvanna, etcetera. If trends continue, the Chicago-New York-DC Megalopolis will slouch south in the next twenty years, swallowing us up and ruining our way of life and economic health. I don't believe I'm exaggerating here, I foresee bad things if major shifts aren't made soon. Even if Albemarle and Charlottesville stay relatively undeveloped, we'll be an island of green in a sea of awful. So that's my fear. I watched it happen in Miami when I was growing up there, and many of you watched it happen in Northern Virginia and elsewhere. The horror.
People want to live in Charlottesville, but because of the way the rules are set up, the only really profitable way to house them is outside the city. Developers buy up surrounding farms cheap, wait a few years, then develop to get the highest price. It's huge money. Dr. Hurt and Wendell Wood didn't become millionaires because they wanted to make our traffic problems impossible and our lives less social and relaxed and physically fit. They wanted to buy low and sell high, like good entrepreneurs.
The way the existing body of laws is set up, developers make the most money by buying low in rural areas surrounding a city, and developing to sell high. They don't make their money selling houses, but in selling land. Developers aren't evil. This came as a bit of a revelation to me, coming from the environmental community, but I believe they simply want to be good entrepreneurs. The challenge then, if we don't want to consume Central Virginia in a sea of awful development and traffic, is to change the laws so that buying low and selling high means compact development in the city. Let's make capitalism work for Charlottesville's future instead of against it.
There are three policies I see as crucial to accomplish this. I assembled them for Charlottesville, but I suspect they would work well in any growing community:

1. A form-based code. This idea was sprung by Duany Plater-Zyberk, the minds behind New Urbanism. Did you see Truman Show? Remember how pretty his town was? That's New Urbanism. Anyway, normal code, Charlottesville's for example, evolved from court battles. People needed to be less bad to prevent lawsuits. So older codes talk about all the bad things developers shouldn't do. Form-based codes talk about all the good things the community wants, and gives developers clear examples and instructions to do it, with easily understood graphics. Reading them is a breath of fresh air for a planner used to older codes. And the beauty of this is that developers are set up to succeed. All the problems that normally come up in the review process are designed out up front, allowing a greatly accelerated approval process. This means developments get a clear timetable and guaranteed public support. Why? Because they're doing what the residents want, from the get-go. Plus, the city saves big bucks on staff time and advertising money for public comment. You can see a beautiful example here. I'm hoping to develop some open-source software in graduate school that allows anyone to almost instantly develop an approved site plan and profitable business plan using this code.

2. Transit that matters. In Charlottesville, people are talking about a streetcar. Other places are talking about bus rapid transit or light rail. What's crucial is a transit system that makes people want to take transit. Most (unprofitable) systems, such as Charlottsville's, serve people who have to take transit because they have no other choice. Everyone else is given excellent roads for their cars, which is the natural choice. Since the gas prices went up, I've been riding the free trolley a great deal, and let me tell you, it ain't competitive. It's extremely undependable, slow, and inconvenient. It's easier for me to drive everywhere. This is wrong. I should have some excellent alternatives, in case I want to be more physically fit, or get outside more, or want to be easier on our air. And in fact, I do. By offering competitive transit, the city becomes a much more attractive place to live, and therefore, a much more attractive place to build. People may cry gentrification at this point, but do you think it's nicer to lower income folks to force them to either live in a house they can't afford close in, or live so far out that they have to drive more than they can afford? Affordability is a big part of this plan, as is diversity. A bus system that only the poor and disabled use, that is clearly inferior to car travel, is not being nice to the lower income folks.

3. Land value tax. A huge reason why developers don't invest in urban areas is that as soon as they invest money in property, it raises the value of the property, and therefore the taxes. As soon as developers put money in, they have to swim upstream to stay profitable. This higher cost is passed on to consumers in various ways, either in the real estate market or hidden in retail prices. Lynchburg and Richmond have somewhat addressed this by offering developers several years with no tax increases when they rehabilitate historic properties. That's a nice thing, and I support it, but I don't believe it goes far enough. I would like to see taxes on all buildings eliminated. Taxes on land would rise to make up for the gap, making this shift revenue neutral. What happens then? Well, development becomes tax-immune. People are free to do whatever they like to their property with no fear of the assessor. In fact, the city can save a great deal of money by canceling real estate assessments. This makes investing in development very very attractive. This could be phased in over several years to ease the market shock.

So that's my recipe for success. If all three elements are enacted at the same time, we'll see a major shift in development away from the suburbs and into the city along with major improvements in housing affordability, lower taxes, better mobility, and a more pleasant, livable city.