VACANT LAND AND ABANDONED STRUCTURES

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VACANT LAND AND ABANDONED STRUCTURES Powered By Docstoc
					    TERRA INCOGNITA:
Vacant Land and Urban Policy

                 27 August 2008
                 Cleveland Federal Reserve
                 Columbus, Ohio

                 Michael A. Pagano
                 Dean, College of Urban
                 Planning and Public Affairs
                 University of Illinois at
                 Chicago
                 MAPagano@UIC.edu
Vacant Land/Abandoned Structures
Motivation to undertake the study some 10
years ago:
– Few comprehensive analyses of vacant land.
– Vacant land inventories are not state mandated and
  therefore only exist on an ad hoc basis.
– Little contemporary empirical evidence to inform our
  understanding of vacant land.
– No agreed upon definitions of “vacant land”:
   • “good” and “bad” vacant land
          Study Methodology
• Survey mailed to planning directors in all
  198 U.S. cities with 1990 populations of
  >100,000.
  – Response rate: 50.3%
• Site visits to three metropolitan areas with
  different concerns about vacant land
         Quantity of Vacant Land:

Vacant land survey (1963) of 48 cities: 20.7%
           1998 Survey, 71 cities: 18.1%

Cities with fixed boundaries (1963), 12 cities: 12.9%
             1998 Survey, 20 cities: 13.1%

Cities > 250,000 population (1968), 40 cities: 12.5%
            1998 Survey, 20 cities: 15.4%
Vacant Land Conditions                                Number
                                                      of Cities
Vacant parcels not large enough                              97

Odd shaped parcels of vacant land                            75

Vacant land in “wrong” location                              72

Other conditionsa                                            60

Vacant land is in undersupply                                58

Parcels have been vacant too long                            45

Vacant land is in oversupply                                 43

  a Other  conditions include land that is vacant due to real estate
  speculation, perceived (or real) contamination, steep slopes,
  infrastructure problems, or wetlands.
                       Di                            Number of C ities
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                                                                                         Land During the Past Decade




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                                                                                         Figure 1.2: Causes of Increased Vacant




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                                                                                                                                       Vacant Land During the Past Decade




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Table 2.2: Vacant Land in Cities with Growing Populations


                  # Cities Average % Average % of       Median % of
 Census Region     >50%    Change in Vacant Land to Vacant Land to
                 Change in Population Total Land Area   Total Land
                 Population , 1980-95                      Area

West                10       115.4         24.4            24.7
South                8       101.9         20.2            19.7
Midwest              1       181.7         13.0            13.0
Northeast            0          -            -               -
Cities >50%         19        113.2        22.0            17.4
Change in Pop.
Total Survey        70        43.6         15.4            12.7
            Table 2.3: Vacant Land in Cities with
            Declining Populations

                      # Cities With       Average %         Average % of
                     Population Loss      Change in        Vacant Land to
                                       Population, 1980-   Total Land Area
                                              95
Midwest                    4                 -5.3                8.2
Northeast                  2                 -5.6                4.2
South                      2                 -7.1                4.4
West                       0                   -                  -
Cities W/                  8                 -6.0                6.6
Population Loss
Total Survey               70                43.6               15.4
            Table 2.4: Vacant Land in Expanding Cities
                        # Cities >25% Average % Average % of Median % of
    Census Region        Change in    Change in   Vacant Land Vacant Land to
                         Land Area   Land Area, to Total Land   Total Land
                                      1980-95        Area         Area

West                         6          45.4         24.9         28.3
South                        8          74.3         23.1         21.0
Midwest)                     2          33.7         19.0         19.0
Northeast                    0            -            -            -
Cities With >25%
Increase in Land Area       16          58.4         23.3         23.0
Total Survey                70          18.0         15.4         12.7
    Table 2.5: Vacant Land in Cities with Fixed Boundaries

                   # Cities With    Average %      Average % Median % of
   Census Region   Negligible or Change in City of Vacant       Vacant Land
                   No Change in       Land        Land to Total to Total Land
                    Land Area      Area,1980-95    Land Area       Area

West                    8              +.35           11.5          5.8
Northeast               4              +.21            8.3          7.5
South                   5              +.39            7.5          3.4
Midwest                 3              -.41            4.4          6.0
Cities W/ Fixed         20             .22             8.8          5.7
Boundaries
Total Survey            70             18.0           15.4         12.7
  Policies for City-Owned Vacant Land
       and Abandoned Structures

* 16 cities allow the disposition of city-owned
  land or buildings below fair-market value.
* 31 cities offer other subsidies or inducements
  as an incentive to private individuals to
  purchase city-owned vacant land.
* 17 cities have an “infill” policy.
* 11 cities have policies specifically designed
  for the reuse of abandoned structures.
Hypothesized Causal Factors of Vacant
  Land and Abandoned Structures

      Change in Economic growth
      Fiscal condition
      Regional location
      Change in Land Area
      Change in Population
      Elasticity (the Rusk index)
                Findings
1 The more elastic cities have higher
  proportions of vacant land vis-à-vis the
  total land area. The more elastic the city,
  the more vacant land it has.
2 The slower a city’s population growth
  from 1980 to 1995, the higher its number
  of abandoned buildings per 1,000
  population.
Cities’ strategic behavior to maximize
individual and community well-being
derives from three principal imperatives
of municipalities in a federal system:

        First, because cities must pursue
        policies that augment or, at a
        minimum, maintain the economic
        vitality of the community, policy
        officials are induced to use land to
        its highest and best use.
Second, because cities must pursue
policies that minimize social disruption
and protect property values, policy
officials are encouraged to assemble,
zone, and dedicate land for the purpose
of simulating natural barriers and
protecting property values.
Third, because cities must pursue
policies that enhance their fiscal
condition, policy officials are
motivated to consider development
options that either maximize
revenues or minimize costs.
A 3-Dimensional
Model of Strategic
    Behavior
Vacant Land and Cities’ General Taxing Authority

                      General Tax Authority   N     Mean
  Vacant Land as a    Diversified (Sales or
  Percentage of Total Income or Sales and
  Land Area           Income)                 106   0.175

                      Property Tax Only       38    0.142
  Number of           Diversified (Sales or
  Abandoned           income or Sales and
  Structures per      Income)                 98    2.227
  1000 Population
                      Property Tax Only       32    0.895
  Spatialization of Revenue Structures

Why promote development or a certain
type of development at a particular
location?

Given a choice, parcels will be identified
for development that maximize revenues
or minimize costs. The ‘mini-max
incentive’ embedded within the context
of a city’s revenue structure manifests
itself spatially in the design, land-use
        Figure 1: Idealized Urban Form of Property Tax Cities




       STRATEGIC BEHAVIOR OF PROPERTY-TAX CITIES
Property-tax cities think strategically about development based on the market value of the
development and on the possibility of shifting service-delivery costs to other jurisdictions
                                    (fiscal externalities).
      Figure 2a: Idealized Urban Form of Sales Tax Cities




          STRATEGIC BEHAVIOR OF SALES-TAX CITIES
Sales-tax cities think strategically about development based on their mental constructs of
             “shopping sheds” and on which market transactions are taxable.
Figure 2b: Idealized Urban Form of Sales Tax Cities
         (with expansion capacity)
        Figure 3: Idealized Urban Form of Income Tax Cities




        STRATEGIC BEHAVIOR OF INCOME-TAX CITIES
Income-tax cities think strategically about development based on their assessment of the
                    income growth potential of the individual or firm.
                 Figure 4: Idealized Urban Form of Site-Value Tax
                 Cities
             City A

                                Commercial


    STRATEGIC BEHAVIOR OF SITE-VALUE TAX CITIES
Site-value-tax cities think strategically about development based on the possibility of
      shifting service-delivery costs to other jurisdictions (fiscal externalities).


                                     Density determined by market
                                                 forces




                            High Density                     Industrial




              City B
                                                                          City C
     Policy Questions?
1. Sprawl and transportation.
Low density growth is caused by
numerous factors (e.g., transportation
and land costs), but might sprawl also be
encouraged because of cities’ pursuit of
revenues. For example, if sprawl is an
outgrowth of sales-tax cities’ demand for
resources, would a different revenue mix
curb or diminish sprawl?
2. Regional cooperation.

  Do revenue structures influence
  cooperative behavior among local
  governments? What immediate gains to
  a municipality with undeveloped land
  near it would cooperation with a
  neighboring municipality generate?
  Unless forced by the state to adopt a
  cooperative face, the revenue logic of
  cities, especially sales-tax cities, might
  discourage cooperation.
3. Revenue Structures and Land
   Use.

   If land use/zoning follows the logic of
   spatialization of revenue structures, how
   could zoning and land use change with
   the introduction of a different revenue
   system?
    TERRA INCOGNITA:
Vacant Land and Urban Policy

                 27 August 2008
                 Cleveland Federal Reserve
                 Columbus, Ohio

                 Michael A. Pagano
                 Dean, College of Urban
                 Planning and Public Affairs
                 University of Illinois at
                 Chicago
                 MAPagano@UIC.edu

				
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