Rational Response #4: Establish Service Areas

Americans today have the choice between three different lifestyles: rural, urban and suburban. These are the same choices that have been available throughout history but, until we blurred the differences in our Suburban Experiment, those choices meant something very different.

As our governments cope with economic transition, those differences need to matter once again.

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Rural areas are for the pioneer. The hearty. Or for the infrequent getaway. Growing up on a farm along a little road distant from town, we knew that the fire truck was not going to get there quickly. If there was an injury on the farm, the ambulance wasn’t going to arrive in seconds or even minutes. When it snowed, we weren’t going to get plowed out as quickly as those in town would and, in fact, we may have a number of days where we weren’t going anywhere. That was okay; we made due. We never saw a policeman, rarely heard from the local government (zoning?), but we knew when all the neighbors were bringing in their hay. Our cellar was full of vegetables, the shed full of split wood and a loaded shotgun sat behind the door. It was a really good life I feel fortunate to have enjoyed.

Urban areas were for a completely different type of person, someone wanting to live in a totally different way. There the ambulance would show up right away. In fact, the hospital was just up the street for many places. The policeman patrolled the streets. There was shopping and parks and schools, all within walking distance. I had many friends who lived in the city and, while their life was very different than mine, it was also pretty good.

Prior to the Suburban Experiment, suburban areas contained a unique blend of people. I would call them upstarts, although they could easily be called the poor. In the traditional development pattern, the core of the city contained the most valuable land and the more affluent would congregate in the surrounding neighborhoods. On the edge of this was where the poor lived. This was the pre-automobile version of walk-until-you-qualify. As the city continued to mature, the forces of incremental growth would be directed inward, upward and outward with the latter being where these upstarts would be able to make modest investments that could grow over time. This was where you got the tiny house that could be added on to when the kid was born. It was also where the slums would sometimes coalesce. When things worked out right – when the party was good as Ian Rasmussen described – things got incrementally better for everyone.

To start responding rationally to the complex set of problems we’ve created, we need to actually reestablish a relationship between the productivity of the place and the services that we are able to provide. This means looking at our community and clearly spelling out geographically where those high service areas are. It would look something like this in my hometown of Brainerd, MN.

Here’s how I would distinguish each area.

In other words, where we have places that are financially productive – where the traditional development pattern is being used to create, capture and grow the wealth of the community – those are the places where the collective investment (taxes) can support the lifestyle choice of those choosing to live there. This would be true in urban areas where service demands are high and in rural areas where (and this is important) service demands are low.

In the places in between, where the pattern of development simply does not support a high service level, there the services become more al-la-carte. We will keep your taxes low – we’re not going to ask you to subsidize anyone else – but we also can’t subsidize the lifestyle that you’ve chosen for yourself. We’re not going to rip up your street, but when it falls apart, we’re also not going to fix it. You’ll need to do that. We’ll come out there with the fire truck, but we’re going to charge you for that.

In short, we’re creating a system that more closely correlates demand for services with willingness to pay. Someone moving to a community, understanding these different service levels and tax/fee structures, can choose the situation that best suits them.

Now I grasp that there are some practical problems here with the tax system. In most cities, you can’t establish different taxing areas and charge residents in different neighborhoods a different rate. Today any city can pretty much do the rest, and in a future rational response, we’ll talk about some changes to the tax code that would help cities align their service demand with the productivity of their development pattern.

And it should be said: those property owners in the fee for service areas that want to be designated high service areas can easily do so. They need to agree to a development pattern that includes continuous, incremental growth (there will be no process providing them an opportunity to oppose that accessory apartment next door or that coffee shop up the street) and pay a much higher rate of taxes.

One final note on the poor and disadvantaged in our communities. My greatest apprehension with our current pattern of development is that, after the transition that a lack of financial productivity is forcing upon us, it is the poor that are going to be trapped on the edge of each community – just like they have been for thousands of years – only here in North America it will be in suburban areas with horrible transportation, public safety and health provisions. That fear should not keep us from responding rationally to correlate willingness to pay with the provision of services, but it should prompt us to ensure that our urban areas continue to offer a broad range of price points within a financially productive built environment.


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