Virginia’s Road to Ruin

Proposed growth legislation bad for Virginia housing, economy

A centerpiece of Virginia Governor-elect Timothy Kaine’s successful campaign was proposed legislation that would “stop out-of-control development that increases traffic.” While this was music to the ears of voters fed up with long commutes and traffic congestion, this legislation would run a serious risk of crippling the state’s thriving construction industry, driving housing prices higher for families in the Commonwealth, and encouraging the urban sprawl that Governor-elect wants to prevent.

Kaine’s proposed legislation – similar to “Adequate Public Facilities” legislation adopted in other states – has two key elements. First, developers statewide would be required to prepare impact statements that detail what kind of traffic new developments would generate. Second, the Governor-elect wants to give local governments the authority to deny zoning applications when road capacity is found to be insufficient.

In other words, if a new development would generate more traffic than the current road system can handle, then it can be denied. But there are several practical problems with Kaine’s approach.

First, since all development is likely to increase traffic, where do you draw the line between needed housing for a growing population and “out-of-control” development? Would there be a one-size-fits-all set of traffic impact standards that would apply to all local governments equally, or would they be able to set their own standards? If the latter, then who determines whether local governments are actually meeting the law’s goals? And where would funding come from for needed transportation improvements? The legislation may sound good on the surface, but the devil is in the details.

Second, transportation projects that increase traffic capacity – like road widening and new road construction – often take years to complete. Scarce government funding is one cause; there are simply too many transportation needs and too little funding, so needed projects can wait years for their turn in the funding cycle. Projects also face numerous regulatory, legal, and bureaucratic hurdles that cause delays. Required environmental impact assessments alone can take several years for a major project and must be completed and approved before any ground is broken.

Faced with the inherent delay in bringing new infrastructure online, it’s unreasonable to demand that new growth wait until transportation capacity exists to accommodate it. There’s already a shortage of new housing to meet the demand of Virginia’s rapidly increasing population, particularly in the fast growing suburbs of Northern Virginia. Making it more difficult to build new homes would push housing prices even higher, perpetuate sprawl by forcing development further and further away from urbanized areas, and severely harm what the Governor-elect has previously claimed to be the “engine” of the Commonwealth’s economy — the housing industry.

The Kaine Administration would do well to learn from Florida’s experience with “adequate public facilities” mandates. One pillar of the state’s 1985 Growth Management Act was a requirement that the public facilities and services needed to support development (i.e., roads, water, wastewater, etc.) would be produced concurrent with the development.

But the Act’s concurrency requirement did not specify how new infrastructure needed for development was to be financed. This was not an oversight; it was intended to force governments to appropriate funds for new road capacity to comply with the law. But this was easier said than done, given local governments’ unwillingness to raise taxes to fund transportation improvements.

Over time, developers found that the easiest way to comply with the concurrency requirement was to build in less developed areas where roadway capacity could accommodate growth without necessitating road improvements. This had the unintended consequence of perpetuating the urban sprawl that the Act was designed to prevent.

Recognizing these shortcomings, the state later carved out two important exemptions to the concurrency requirement. First, local governments were allowed to approve new development that would add traffic to already congested roads if it would help achieve other planning goals, such as promoting urban infill development or redevelopment. Second, local governments were granted the authority to allow developers to build in congested areas in return for a payment equal to the cost of providing the additional capacity needed to offset the traffic generated by their projects.

Florida’s experience offers several lessons. First, adequate public facilities mandates promote sprawl by creating an incentive to shift development to rural, congestion-free areas. Second, the state gutted its concurrency requirement when it became apparent that it was unworkable; as a result, concurrency has been largely ineffective at achieving the desired goal of reducing traffic congestion. Finally, while seemingly making the concurrency requirement more practicable, allowing developers the option of “buying out” has rarely led to any new roads being built, largely due to high costs and community opposition. And these payments are passed along to new homeowners, raising the costs of housing and making home ownership more difficult for low- and middle-income families.

Instead of trying to tie local planning decisions to the adequacy of existing infrastructure, a better approach would be to require the state and local governments to do a better job of planning and building the transportation network needed for growth in the long term. Having the certainty of knowing where new roads will be built or existing roads widened would allow the private sector to make development decisions that most effectively optimize the use of land.

Governor-Elect Kaine should rethink his strategy and consider how to compel government to plan for its own resources rather than dictate how private property is used. Looking forward, Virginia’s transportation network should be planned to accommodate growth, not the other way around.

Leonard Gilroy is a certified planner and policy analyst at the Reason Foundation

Leonard Gilroy is Senior Managing Director of the Pension Integrity Project at Reason Foundation, a nonprofit think tank advancing free minds and free markets. The Pension Integrity Project assists policymakers and other stakeholders in designing, analyzing and implementing public sector pension reforms.