How planning can pay
|CPEX wants the public to know urban core investments can lead to economic benefit.|
In 2005, Raleigh, N.C. invested $10 million in redeveloping its downtown area. The plan wasn't popular, and urban planners had a hard time getting taxpayers to understand the wisdom behind it.
“No one thought investing in downtown was worth it,” says Mitchell Silver, the city's chief planning and development officer. “Downtown Raleigh was not a place that anybody wanted to live or shop.”
Just seven years later, that $10 million investment has resulted in more than $2.5 billion in private investment, with shops, restaurants and—this is the most important one, according to Silver—thousands of new multifamily units lining Fayetteville Street in Raleigh and the surrounding neighborhood.
Raleigh officials don't yet know how many actual property-tax dollars the city has netted from its initial investment because property is assessed there once every eight years. But based on the economic activity alone generated in the vibrant and growing downtown corridor, they are reasonably certain every penny of the $10 million was worth it.
“It was such a success, now we are replicating that same model all over the city,” says Silver, who also serves as president of the American Planning Association. “People are beginning to realize there is a real economic value to good, solid, land-use planning. There is a direct connection between planning and economic development.”
Raleigh is one of a growing number of cities that is taking an economic approach to planning, and Silver is one of its disciples. He'll be bringing that message to Baton Rouge at the Center for Planning Excellence's 2012 Smart Growth Summit, which will be held Aug. 27-29. CPEX officials say it's a message the local community needs to hear and take to heart.
“Data is out there to show how a small amount of public investment and a successful plan will lead to long-term, sustained private investment,” says CPEX Director Boo Thomas. “We have shown that with our own downtown area here in Baton Rouge. We want elected officials and developers to understand it can be that way everywhere.”
It's not always an easy message to convey. Even in so-called progressive locales like Raleigh, part of North Carolina's high-tech Research Triangle, local government is often loathe to spend public dollars on infill and redevelopment projects, preferring instead to direct developers to the outskirts of town. But Silver says research shows municipal and state governments get a better return on their investment, or ROI, if they work from master plans that focus on the urban core of an area.
“If you plan smart and plan right, it is the best way of stabilizing your tax base,” he says. “We have learned in Raleigh that a downtown location can have 50-to-90 times the tax value of a suburban location. In other words, the more density you put on it, the more value you create.”
As a hypothetical example, the returns could vary widely on a $10 million publicly funded infrastructure project, like the widening of a road. The rule of thumb, according to Silver, is that if the project is built in a suburban location, it will yield a 2% return and take 40 years to pay off. If you take a similar project in a higher-density area, the ROI will be 30%—and the project can be paid off in three years.
“A six-story building downtown has a much higher ROI than a Walmart on the edge of town,” Silver says. “That is counterintuitive to the thinking of a lot of people.”
CPEX officials are optimistic Silver's address will be well-received. In the years since CPEX began hosting the Smart Growth Summit in 2003 (the conference took a hiatus from 2004-2006 and resumed in 2007) awareness about the importance of smart growth and proper planning has spread throughout the Capital Region, and beyond. Last year's event drew more than 800 attendees from 31 parishes.
CPEX QUICK HITS
The Baton Rouge Center for Planning Excellence will hold its Smart Growth Summit at the end of the month. See some of the scheduled events here.
“People understand the message now because they can see the results,” Thomas says. “The best visible sign of what a good plan can do is the Shaw Center for the Arts. Look at what that has done for our downtown area. That is really the perfect example of what a plan can do.”
While this year's Smart Growth Summit revolves around Silver's theme about the smart economics of smart growth, the conference will also address other pressing issues relevant to land-use and planning. Other topics on the agenda include: parks and greenways, bike infrastructure, art for revitalization, financing, water management, preservation and green building, to name a few.
Another noteworthy item on the agenda deals with building and development in coastal communities, a subject of increasing importance in south Louisiana's eroding parishes. Earlier this summer, CPEX published a Best Practices Manual for Development in Louisiana, which explains and illustrates the latest available international, national and local best practices in coastal development. The agency also published a coastal toolkit, which focuses on hazard mitigation and natural resource protection in coastal areas. Both will be officially unveiled at the summit.
“The value of the summit is really in introducing new ideas,” Thomas says. “It's getting everyone in the same room. It doesn't change your culture overnight, but little by little, things start to change.”
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