Leading experts weigh in on current policy issues and challenges

Land-Use Regulation: What’s It Worth Anyway?

A century after the US Supreme Court endorsed zoning in Euclid v. Ambler, questions about the value of zoning and other land-use regulations are more central, in more conversations, than they have been for decades. Do land-use regulations hurt housing affordability more than they help achieve other goals? Would high-income metropolitan areas like the San Francisco Bay Area contribute more to economic growth if they weren’t so regulated? What benefits do land-use regulations still offer us?

Many of these questions still generate disagreement. And even when people agree that land-use regulations have negative effects, they often can’t agree on what to do about it.

To shed some light—and maybe even generate some heat—on this issue, the Urban Institute and the Cato Institute collaborated to frame a policy debate on land-use regulation.

The Urban Institute is talking with...
Vanessa Brown Calder Vanessa Brown Calder
Lance M. Freeman Lance M. Freeman
Emily Talen Emily Talen
Robert Dietz Robert Dietz
Richard Rothstein Richard Rothstein
Dana Berliner Dana Berliner
Derek Hyra Derek Hyra
Tony Arnold Tony Arnold
Rolf Pendall
Moderated by:
Rolf Pendall
Codirector, Metropolitan Housing and Communities Policy Center
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Our first topic of debate is the costs and benefits of land-use regulations. Rather than starting it off on one or another of these, we’d like to ask all the participants to start with your “favorite” cost or benefit, providing the strongest evidence that it’s worth paying attention to. After a few costs or benefits have been proposed, mix it up. Challenge each other—or come in with support.

Thanks very much for kicking us off, Rolf. I look forward to seeing where the conversation goes, and what we can learn from each other.

 

I’ll add something to get us started. Rolf and I forecast that one “cost of zoning” perspective that may go under-represented is the cost of zoning to the labor market. As housing costs climb higher (more on that to come, I hope), zoning restrictions impact worker choices and labor market opportunities. Compelling recent research focuses on this relationship. For example, Daniel Shoag and Peter Ganong’s study indicates that low-skill workers are immobilized in job deserts due to the high costs of housing associated with land use regulation. And new research suggests that zoning and land use restrictions resulted in an 8.9% decline in aggregate economic output and a 50% decline in aggregate US economic growth over a span of 45 years. The authors argue that this decline is a result of the spatial misallocation of labor associated with land use restrictions.

One major cost of zoning is the suppression of entrepreneurship, harm to small businesses, and general reduction of income and increase of costs for people, with those who are not wealthy finding these costs to be most burdensome. 

 What started as a simple “don’t put a chemical factory next to a bunch of homes to protect public health and safety” kind of practice (what the Euclid case was about) has morphed into something much less concrete. Zoning—like eminent domain (which I also have a lot to say about but won't here)—now allows the government to consider “spiritual, as well as physical, aesthetic as well as monetary” values. Belle Terre (quoting Berman v. Parker). The desire to control every aspect of people's property use, via zoning, means all kinds of controls that ripple through both residential and business uses.

Zoning has expanded to who can live with each other in a residential zone (at issue in Belle Terre). It's not just separating residential uses from other uses, it includes determining what kinds of residential uses are allowed in a residential zone (no short-term rentals of residential property for residential use or no renting residential property for residential use at all). Some cities are even taking the position that you have to limit who visits your home, lest they think you are running an illegal short term rental. And of course there are restrictions on household size, who can live together, whether people in apartments can live near people in houses, if the houses can be small or not. All of these interfere with people's private living choices.

On top of the residential restrictions are the restrictions on business, on where exactly certain kinds of businesses are allowed to be (and not just adult bookstores or liquor stores. Tattoo shops have been limited. So have chain restaurants, but not local restaurants). An example from Arizona a couple years ago:  you want to put an electronics business in an area for electronics businesses on land you have owned for a decade? Sorry, you are not the right kind of electronics business (or is it you are not the right kind of people?), go elsewhere. http://www.azcentral.com/story/news/local/chandler/2015/03/15/along-chan...). And of course all sorts of other nonsense: You own a one-acre lot and want to build a second house on it so your elderly parents can live there and you can take care of them? Not allowed! Treehouse? Not allowed. Swing set? Nope. 

The picayune nature of modern zoning codes has led to four further undesirable outcomes. First, no one understand them, so bureaucrats take it upon themselves to make up the rules or to apply confusing rules inconsistently. This is the very definition of arbitrary regulations. We have seen multiple cases here at IJ where bureaucrats were enforcing “zoning regulations” that were not in any zoning code and were often contrary to the actual code provisions. The only way to sort it out is, possibly, by hiring a lawyer. It's usually easier to abandon your plans.

Second, it gives city leaders the misperception that they can micromanage land and control their economy. In doing so, they zone and rezone and overlay, meaning that people cannot rely on their being able to continue their previously legal activities. It diminishes security and means that long-term plans and investments may come to naught.

Third, because everything is forbidden, but you can get exceptions, you wind up with government for the favored and powerful. This undermines the idea of rule of law. For example, many municipalities ban home-based businesses. This is a problem, because start-ups frequently start in someone's home. That's how new businesses and new ideas are created. Realizing this, cities will then exempt certain types of home-based businesses, create complicated rules for home-based businesses, and generally make it a situation where favoritism prevails. If you aren't connected, it could take you two years to get permission to do your business legally. As any entrepreneur knows, that's worse than an outright no. No one can wait through two years of city council and planning meetings. You should instead move, abandon your project, or operate illegally. 

Finally,  many municipalities now take the position that the position that, when it comes to the use of land, everything is forbidden except that which is expressly allowed in the zoning code. This has obvious limiting effects on new businesses and models. Food trucks?  Our zoning code written in the 1980s does not specifically allow them, so they are forbidden in this city. Small houses? Ditto. Mobile dog grooming, windshield chip repair, etc.? Not mentioned in the code so not allowed.

Zoning law needs to be drastically simplified, if not eliminated. Address at most actual dangers to public health. Stop picayune regulation, decisions that depend entirely on the personal views of people in power and who is connected to them. Creating an environment of certainty, predictability, and greater freedom would do wonders for entrepreneurship, job creation, and small businesses throughout the country.

I heartily agree that zoning as it now stands needs substantial change. Zoning has disfigured the American landscape and exacerbated social inequality. But I would not want to see planners and citizens lose the ability to control development. Zoning is a powerful way to enact change.  We need this power to get the kinds of cities we want – beautiful, socially just, diverse. In a market-driven economy, lack of zoning does not breed diversity, it breeds homogeneity.

Although we have lost site of it, zoning can help to achieve noble aspirations when it comes to city-building. We need to reform it, which many planners are now doing.

In a period in which housing production continues to be constrained by supply-side bottlenecks, the economic costs of zoning (among other burdens) effectively represent a tax on new construction. Limited housing inventory, in turn, increases the cost of renting and home buying. These effects are particularly strong in areas with strong job and population growth, which raises the cost of land and increases the "entrance" cost of younger workers to enter the labor market. Vanessa cited some useful impact estimates in this regard.

So how large are these effects? It varies a great deal from market to market of course. However, in an NAHB research effort conducted in 2011 and 2016, our association surveyed land developers and builders to attempt to estimate the cost of various regulatory burdens through the entire home construction process for the single-family market. The 2016 research found that regulatory burdens in aggregate represented, on average, 24.3% of the price of newly-built single-family home. Now, this is the combined effect of all kinds of rules and requirements.

The costs for the lot development stage in isolation made up 60% of the total. This component included costs due to zoning. For example, costs (including delay costs manifesting as interest expense for debt-financed land acquisition and development) due to subdivision and zoning approval added 3.1% to the final price of a home. These costs, in fact, made up 12% of total land development costs. The cost of land that was required to be left unbuilt or undeveloped (effectively land that must be purchased on the behalf of the eventual homeowners of the neighborhood) added on average 2.6% of the final home's price. 

Such costs add up quickly in a death by a thousand cuts exercise. Each $1,000 increase in the price of a home prices out approximately 153,000 households from qualifying from a mortgage and purchasing a home. 

And further, as these costs are embedded in the land development and home construction process, a shift occurs on the supply-side of the market. Builders build fewer smaller and lower priced homes because it is more difficult to pass along these costs to buyers. This market shift is clearly seen in median home size data for the post-Great Recession period, in which builders shifted to larger, more expensive homes.

The good news for first-time buyers and the entry-level market is that increasing number of builders are experimenting with adding small, lower priced homes in some markets. For example, townhouse construction has expanded in a healthy manner over the last few years. These market data suggest that if local jurisdictions can reduce regulatory burdens associated with zoning and permit density where local markets demand it, builders can build.  As Generation Y ages and single-family housing demand grows, reductions of such zoning and land use burdens would have significant benefits for housing affordability -renters and buyers alike. I think this is an area where broad agreement exists among housing stakeholders.

My favorite benefit of zoning and land use regulation is also the cost that concerns me the most: the adaptability of zoning and land use regulation.  At the core, zoning and other land use regulations function as a set of tools by which people shape the places and communities in which they live, work, and play.  (See The Structure of the Land Use Regulatory System in the United States)  Zoning and land use regulations are the means by which both public and private values – including protection of the public health, safety, morals, and welfare – guide how our lands and places are developed. 

 

As a result, zoning and land use regulations aren’t inherently good or bad or inherently beneficial or costly.  They create the benefits and costs that our political, social, and economic systems choose to create, in the context and constraints of our environmental systems. 

 

When the dominant forces in communities seek to exclude new development or people who are different, local officials adopt exclusionary zoning techniques and use slow- to no-growth tools, just as private developers and property owners use deed restrictions (or CC&Rs), discriminatory real-estate and lending practices, and choices about what kinds of housing to build or buy.  However, when the dominant forces in communities seek to be more inclusive and address affordable housing needs, local officials use inclusionary methods of zoning and regulating land use, while private developers seek to build a broad array of housing options and local residents signal their demand for diverse or mixed-type development. 

 

Likewise, zoning and land use regulations can be used to promote sprawl or discourage it, or to exploit scarce resources or conserve them. 

 

Zoning and land use regulations have been used to discriminate against people of color and low-income people since before Euclid (this coming Fall, my home institution, the University of Louisville, will mark the centennial of Buchanan v. Warley, the famous U.S. Supreme Court case that struck down racial zoning in Louisville in 1917, by holding a symposium on race and zoning).  However, they have increasingly been used in recent years by low-income neighborhoods of color (e.g., East Austin, TX; Little Village, Chicago, IL) to combat industrial pollution and harmful land uses, as well as to shape their neighborhoods, build community-based economic development, address housing needs, and seek essential green and blue infrastructure (e.g., parks, trees, waterway restoration).  With our historic land-use patterns having created and reinforced structural inequalities and marginalization of low-income communities and communities of color in American society, these communities would be further marginalized and discriminated against if we were to eliminate or curtail zoning and other land-use regulatory tools, leaving only private markets for the wealthy to buy the land-use conditions they want (See the American Planning Association’s Planning Advisory Service Report entitled Fair and Healthy Land Use: Environmental Justice and Planning)

 

And despite the tendency of some critiques of zoning to set up traditional Euclidean zoning as a paper tiger or caricature of rigid segregation of uses, many communities have been using post-Euclidean or flexible zoning techniques and tools for decades.  These include conditional uses, variances, planned-unit developments, development agreements, performance zoning, buffer zoning, overlay zoning, site-plan review, exactions, environmental-impact assessments, local environmental regulations, and many others.  Euclidean zoning persists, perhaps too much in some communities, but this isn’t inevitable.

 

Fortunately, this debate has started well past the usual critiques of zoning and has already raised a sophisticated set of questions about how zoning could be reformed, not just eliminated.  The functional adaptability of zoning and land use regulations offers tremendous opportunities for improving how we regulate land use, especially as public and private values may be shifting to support reforms.  We – planners, developers, regulators, property owners, community residents, marginalized groups, environmental experts, economists, and many others – are now concerned with how resilient our communities and cities are.  Can they adapt not only to climate change but also to episodic drought and flood, to heat and fire, to economic and housing-market shocks, to political instabilities, to demographic changes?  The field of land-use regulation offers tools that can be used, developed, or adapted to address these challenges of the near future.  Unfortunately, as an adaptable set of tools to reflect public and private values about relationships between communities and places, zoning and land use regulations can also be used to promote land-use patterns that impose tremendous costs, such as gentrification and displacement, deterrence of development due to procedural delay instead of substantive decision-making, and barriers to affordable and diverse housing.  Specific reforms will be addressed in subsequent posts.

Thanks, everyone, for your comments so far. All of them point to one of the central tensions that make land-use regulations hard to get right. On the one hand, society benefits when property owners have enough freedom and flexibility to alter their plans to account for changing conditions and preferences. On the other, we also benefit from the certainty and predictability that reduce risks for important long-term investments in land development and buildings. It seems like you all agree on the existence of the tension. But you'd weigh the benefits and costs of flexibility and certainty differently.

Partly this comes from disagreements over the likely future benefits of preventing risks by restricting development. But it probably also stems from the way each of you views property rights--which rights and whose rights one emphasizes, and how absolute one thinks a particular property right is.

We see this conflict playing out right now in Texas, whose governor has asked the state legislature to preempt city ordinances requiring property owners to protect large trees. Right now, the governor and some state legislators assert that property ownership confers the right to cut down trees in Texas cities. If their view prevails, then cities would need to find other regulatory mechanisms (such as, for example, conservation easements) to protect trees. Many such measures shift costs from individual property owners to the general public. But they're also often less effective at reducing development. In this case, the public might bear the cost of protecting some trees. They'd also bear the the cost of a less complete tree canopy than they enjoy if land ownership doesn't confer the right to cut down every tree on a parcel.

As many have pointed out, zoning solves one set of problems but creates others. Zoning tries to address the externality problem associated with new development. A new factory that emits noxious fumes or a very dense housing development that adds to traffic congestion are examples of such externalities.

 

Zoning is one tool to deal with such externalities. As previous posters have noted, it is a very blunt tool that comes with many costs including increased housing prices.  Zoning surely needs to be reformed.

But we still need some method for dealing with externalities such as the ones described above. If not the current zoning system, how should we decide when the externalities associated with new development need to be addressed by the property owner?

That is the question that needs asnwering.

Rolf raised a great question about regulatory protection of urban trees on private land.  Regulatory prohibitions on clear-cutting trees on private land reduce the negative externalities – costs – that private landowners and developers can impose on other landowners and the public.  They also can stimulate more efficient and effective non-regulatory solutions.  Most trees on private land in cities and towns are part of networks of urban tree canopies that form critically important green infrastructure – or natural capital – on which our health, economies, and communities depend.  Urban trees reduce urban heat island effects (i.e., higher temperatures in urban areas due to development) that cause people to overheat and even die, as well as increase power demands and power outages.  Urban trees moderate stormwater runoff, filter air pollutants, and stabilize soils.  They improve property values, promote good physical and mental health, and create a sense of place.  When a landowner or developer cuts down a healthy mature tree, they are imposing costs on neighbors, the local economy, and the public by diminishing essential green infrastructure.

 

Property rights are inherently reciprocal.  No one owns land in a place that has no effect on neighbors or the broader community.  This is an inherent feature of our long-standing property rights, including the nuisance doctrine, the public trust doctrine, and even the regulatory takings doctrine.  Property rights are not absolute; no one has a right to do anything they want on their own property if those actions adversely affect other property owners and the public.  Cutting down any and all trees is one of those acts that adversely affects other property owners and the public.  If a landowner or developer clear cuts all trees from their property, they’re shifting the costs of providing tree canopy to the taxpayers or other property owners while benefitting from the trees that the government or others are providing.

 

Interestingly, the Texas example also shows how state politicians are increasingly interfering with local governments’ authority to experiment with different policies and to define their own local communities’ needs and land-use patterns.  For decades, some advocates of environmental protection and smart growth urged greater federal control over land use.  The theory was that leaving land use decision-making up to local governments   However, other advocates of environmental protection, such as John Nolon, Keith Hirokawa, Patty Salkin, Jonathan Rosenbloom, Fran Ortiz, and myself, argued that local governments can and do enact environmental protections that are appropriate to their local contexts and culture.  Federal or state control over local land use is neither desirable nor likely to produce the intended results.  There is no one-size-fits-all, no panacea, to either environmental protection or private-property rights protection.  In fact, the U.S. Supreme Court and other courts, in defining the scope of federal power to regulate land use, have repeatedly noted that land-use regulation is primarily a matter for local governments in our federal system.  Unfortunately, now that some local governments are enacting land-use regulations of private property to protect the environment, special interests seeking to limit land-use regulations have given up on localism in favor of state or federal preemption of local laws.  In addition to facilitating a wealth redistribution from the general taxpayer to those private owners and developers who want to destroy green infrastructure, these preemption efforts will undermine local-government capacity to address local needs and problems.

 

Designing the right kind of tree protection ordinance is key, though.  Local regulators need to understand that their efforts to protect natural capital (e.g., trees) have to be balanced with the protection of political capital (e.g., public support, political forces) and social capital (e.g., trust, cooperation, networks).  They also have to respect the limits of financial capital (e.g., the amount of money that landowners, developers, nonprofits, and governments have to invest in tree protection).  Three features will be important.  First, exemptions or waivers for the removal of diseased trees or trees that pose significant risks to people or structures should be quick, easy, and cheap to obtain from officials who understand and empathize with landowners’ legitimate needs to remove trees.  Don’t put the slow, picky bureaucrat in charge of this.  Second, give developer and landowners options for regulatory relief, such as purchasing tree credits or contributing to a tree-planting fund.  The amounts of these offset fees will need to roughly proportional to the harms caused by the developer’s or landowner’s intended tree removals, and earmarked for replacement of trees in a proximate area.  Third, the regulations should not be the primary set of tools used to protect and sustain the local tree canopy.  Public education and engagement, incentives, government provision of tree canopy as public infrastructure, and partnerships among government agencies, nonprofits, businesses, and community groups are all essential features of a robust urban tree canopy program.  However, regulations often serve to stimulate stakeholders to seek non-regulatory solutions.  This has been demonstrated often in the area of local watershed protection and restoration, often in the shadow of the enforcement of the Clean Water Act (or sometimes the Endangered Species Act).  Collaborative solutions often achieve positive outcomes that purely regulatory solutions cannot, but they come about because of regulatory requirements.

Before we change gears to talk about reforms, I'll wade into the debate with a challenge for Emily and/or Tony, but others should feel free to join in.

It strikes me that Emily and Tony hold a greater share of optimism about what zoning regulations can do or will do in the future. And although most public policies hold benefits for someone or something, zoning has on average been unsuccessful along many of the indicators identified as important in your posts (e.g. demographic diversity, development diversity, social justice, etc).

Is this optimism similar to the way Oscar Wilde described a second marriage: the triumph of hope over experience? Assuming an imperfect world and people's imperfect motivations, what evidence do we have that continuing zoning would do more good than harm on a net basis?

The reason I'm optimistic is that I value the ideal of city planning -- and I don't know how it would be possible to implement urban ideals without some method of controlling private development. And that's all zoning is.

Zoning is at heart the simplest of concepts-- applying land development aspirations in a way that varies by location. Ancient cities had this concept in place.

The U.S. took an awful turn with zoning, that is true. But in some sense our experience is a blip in the historical trajectory. I'm hoping it's still possible to think big picture about zoning and its potential, by going back to first principles. That is exactly what zoning reformers are trying earnestly to do. 

I am troubled by several assumptions that seem to pervade the comments of those who are in favor of using zoning as a tool for fine-grained land use decisions and shaping communities. The first is that this will all work well and costs will be minimal if we just have the right people, doing careful, sensible planning. That is simply not true and not even possibly true. Most people will not subject themselves to a lengthy and discretionary process, even if the people exercising that discretion are very nice people who are trying to do a good job. An ordinary person will not try to open her business, will not expand, will not build two affordable housing units or convert a garage--none of that makes sense to do unless it can be done as of right, with no lawyers, no hearings, no multi-year wait times.  

The second is the conflation of genuine hazards posed by a neighbor's use of property--noxious fumes, loud noises, dangerous chemicals and fire hazards--with aesthetic preferences. There's a big difference between someone opening a slaughterhouse next door and converting their garage into an apartment. That is what I mean when I say that zoning laws must be drastically limited, if they are not going to be eliminated. Zoning can be used to prevent dangerous combinations of uses. But it should not be used to micromanage every person's land use.

To respond to Rolf, when I refer to uncertainty, I mean the uncertainty for the owner of whether she will be allowed to do something with her property. If it's uncertain, then she will not try unless a huge amount of money is at stake. It's just not worth it.

Turning to the question of trees, I like trees--they're lovely, and I prefer areas with trees. But I also do not see that zoning is an appropriate way of preventing my neighbors from removing trees on their own land. That tree may be preventing my neighbor from building an addition, starting a small business, or creating access for a disabled relative.  Or they may be in the way of a large development project. In any event, this is the kind of zoning that I think is far too costly--in monetary terms but also in the suppression of small business and personal liberty.

Thanks for your comments so far; if you didn't get a chance to respond to a previous question please feel free to continue the dialogue in the second round.

 

The second round of the debate begins now. We will focus on a more challenging question: if land-use regulations have unintended consequences we don’t want, how do we reform them? Be as sweeping as you want, but please be sure to propose at least a few steps that have a shot at being implemented and specify who would be responsible for carrying them out.

As to reform of land-use regulations, I agree with the commentary in Edward Glaeser's April 2016 Brookings report. State governments should consider robust cost-benefit analysis of current local land use controls. And new local rules should include such analysis for state-level review. Communities could also consider expedited approval processes for development plans that facilitate affordable for-sale and rental housing. Lowering or eliminating impact fees that are used for general revenue collection purposes, and focusing on tax collections that come about due to growth over the long-run, would also help make land use more efficient.

An ongoing economic challenge for the US is access to labor. Communities effectively make this problem worse through restrictive land use policies by pricing out younger workers from rental and for-sale housing markets in metropolitan areas with job growth and high prices.

I apologize for my late arrival to this fascinating discussion. I was traveling for the last few days, and unable to attend to this previously.  So with your forbearance, I will discuss a context of zoning here, and then remedies in a subsequent posting.

As several other contributors have mentioned, costs and benefits of zoning cannot be calculated only in economic terms. We have a nation that, as many have observed, is suffering from growing inequality that, among its other effects, threatens our social cohesion. The inequality is both racial and economic. Schools are more segregated than ever because the neighborhoods in which they are located are racially and economically homogenous. (Gentrification, which may seem to ameliorate this, is generally transitional, and its amelioration is mostly temporary.) Tragic violent police confrontations with young African American men that result both from the hopelessness and resulting oppositional behavior of those men and the colonial stance of an occupying police force persist largely because we have concentrated the most disadvantaged members of our society in single neighborhoods. Relatively low intergenerational mobility rates in our nation are exacerbated by residential segregation; recent research has demonstrated that low-income African American children who grow up in low-income neighborhoods are less likely, as adults, to achieve middle-class status than otherwise similar low-income African American children who grow up in neighborhoods where poverty is less concentrated.

It is certainly the case that zoning can exacerbate these problems. But it is also the case, as other contributors have noted, that a free land-use market may also exacerbate them, and that different zoning may be necessary to fix them. Before addressing how zoning rules should be reformed, I’ll summarize some zoning history, because understanding this history is necessary before the problems can be addressed.

Although there was some zoning prior to World War I, it was relatively limited (New York City was a pioneer), except for the case of cities (mostly in border states) that adopted racial zoning rules. Many of these cities (Baltimore, Louisville, St. Louis, etc.) had neighborhoods that were more racially integrated residentially than anything with which we are familiar today; they adopted ordinances to attempt to undo this integration. As Professor Arnold pointed out, the Supreme Court prohibited such zoning in 1917. It did so not for reasons of racial equality but because racial zoning (but presumably all zoning) interfered with an owner’s Fourteenth Amendment property right to dispose of property as he saw fit.

As I describe in my recent book, The Color of Law, the Supreme Court’s Buchanan decision inspired and spurred a nationwide expansion of economic zoning as an-often explicit attempt to evade Buchanan’s prohibition of mandated racial segregation. In 1921, Secretary of Commerce Herbert Hoover convened an eight-member committee to consider recommendations for metropolitan zoning. Based on the committee's work, the Department published a "zoning primer" the following year; 100,000 copies were distributed to urban officials nationwide. In 1924, the Department published a Standard Zoning Enabling Act, model legislation that was adopted by many states to authorize local governments to enact zoning ordinances.

Although the Commerce Department’s zoning primer did not explicitly mention racial segregation as a justification for zoning, members of or consultants to the Department’s committee were explicit about the necessity of zoning to prevent racial integration.  

Here is only one of many examples: An influential member of Hoover’s Advisory Committee was Frederick Law Olmsted, Jr.  A year after Buchanan, Olmstead told the National Conference on City Planning that good policy had to be distinguished from “the legal and constitutional question.” So far as policy goes, Olmstead stated that “in any housing developments which are to succeed, …racial divisions …have to be taken into account… [If] you try to force the mingling of people who are not yet ready to mingle, and who don’t want to mingle,” a development cannot succeed economically.

In 1929, Ernst Freund, a Columbia University law professor who was the nation’s leading authority on administrative law, summarized the motives of Hoover’s committee and other national planning experts as follows: prevention of “the coming of colored people into a district,” he wrote, is actually a “more powerful” reason for zoning than creation of districts with similar physical features, the usual public justification for zoning. Because, Freund explained, the Supreme Court (Buchanan) had made it “impossible to find an appropriate legal formula” for segregation, zoning was left as the most reasonable means of accomplishing the same ends.

In 1926, as was described in previous posts, the Supreme Court upheld economic zoning in Euclid.  It was a curious decision because this was a Supreme Court that had consistently (and subsequently) held the liberty of property right to be sacrosanct. Over the course of nearly 40 years, the Court struck down all kinds of regulation (not only zoning as in Buchanan, but most notably, health and safety and minimum wage regulation) on the grounds that it interfered with freedom of contract. Euclid’s permission for economic zoning was the only significant exception to this rigidly ideological approach. In an earlier posting in this discussion, Dana Berliner stated that Euclid was about a simple “don’t put a chemical factory next to a bunch of homes to protect public health and safety” kind of practice. This is not correct. It was about race.

Euclid was a village whose officials were motivated to adopt an exclusionary zoning ordinance by a desire to prevent both African-Americans and Eastern European immigrants from moving to the community from neighboring Cleveland. (Swarthy Italians and Jews had not yet been deemed “white.”) A district court judge initially banned the ordinance, concluding that exclusionary zoning provisions like Euclid's were indistinguishable from the explicitly racial zoning that the Supreme Court had found unconstitutional only nine years before. The judge wrote that he could not pretend not to know what the purpose of the ordinance was: "The blighting of property values and the congesting of the population, whenever the colored or certain foreign races invade a residential section, are so well known as to be within the judicial cognizance," his opinion stated.

In reversing this judgment, Supreme Court Justice George Sutherland's majority opinion asserted that it was appropriate to ban apartment buildings in a district of single family homes because

"very often the apartment house is a mere parasite, constructed in order to take advantage of the open spaces and attractive surroundings created by the residential character of the district…, and bringing, as their necessary accompaniments, the disturbing noises incident to increased traffic and business, … depriving children of the privilege of quiet and open spaces for play, enjoyed by those in more favored localities, -- until, finally, the residential character of the neighborhood and its desirability as a place of detached residences are utterly destroyed. Under these circumstances, apartment houses, which in a different environment would be not only entirely unobjectionable but highly desirable, come very near to being nuisances."

            Although many suburban communities subsequently adopted zoning ordinances that required large lot sizes or street setbacks for single family homes, and prohibited town houses or apartments for reasons of economic elitism, not race, the historical record includes sufficient instances where race was imprudently made explicit to make economic elitism and racial exclusion indistinguishable. A few cases made their way to the courts, and the decisions should be familiar – cases where municipalities up-zoned neighborhoods only when African Americans moved in or were believed likely to move in (e.g. Black Jack, 1974). In one case (Dailey v. Lawton, 1970) where a town refused to grant a zoning variance for a multi-unit dwelling after a barrage of racially explicit public complaints, a federal appeals court asserted: “Although the Planning Commission did not use race as the official basis of its permit denial… [if] proof of a civil right violation depends on an open statement by an official of an intent to discriminate, the Fourteenth Amendment offers little solace to those seeking its protection.” But this reasoning has not been applied nationwide in zoning disputes. More typical was Arlington Heights (1977), concerning a city council that adopted an exclusionary zoning ordinance at a meeting where members of the public urged the council to act for racially discriminatory reasons, and where letters to the local newspaper openly expressed a desire to exclude African Americans as reasons for opposing the development. Yet the Supreme Court deemed the ordinance to be constitutional because it could not be proven that the council members themselves were motivated specifically to exclude African-Americans, not merely all lower-income families.

            The mass suburbanization of the United States was accomplished largely by Federal subsidies to developers of entire subdivisions – on explicit condition that exclusionary zoning ordinances be adopted, that no homes be sold to African Americans, and that home deeds include restrictive covenants prohibiting resale to African Americans. The three requirements were mutually reinforcing, and indistinguishable. Beginning in 1935, the Federal Housing Administration's Underwriting Manual gave instructions to bank appraisers who hoped to qualify construction and development loans, as well as individual mortgage applications, for FHA insurance. Appraisers were told to give higher ratings where "[p]rotection against some adverse influences is obtained by the existence and enforcement of proper zoning regulations and appropriate deed restrictions," and added that "[i]mportant among adverse influences … are infiltration of inharmonious racial or nationality groups."

            From this and much other evidence, it is apparent that we have an unconstitutional racial residential landscape. Whether zoning is unwise for economic or social policy reasons, we have, whatever its economic wisdom or lack thereof, a constitutional obligation to reform it. As I wrote in The Color of Law, letting bygones be bygones is not a constitutional policy.

Thanks for your question, Vanessa, about the basis for my optimism about zoning.  I do think that zoning and land use regulation can be improved substantially, although imperfectly, and that it’s worth seeking major regulatory reforms for three reasons. 

 

First, zoning and land use regulations are practical tools that are used pervasively in U.S. society in a variety of different ways; I just don’t see massive repeals of zoning laws occurring in most communities. 

 

Second, zoning and other governmental regulations of land use are not the only forms of managing land use and development that under-perform.  Zoning reminds me of the famous Winston Churchill quote: “Democracy is the worst form of government, except for all others.”  Zoning is the worst form of controlling the harmful effects of land use, except for all others.  For example, Houston, with its lack of zoning, does not lack many of the land-use and growth problems of other cities with zoning.  The Milken Institute’s Best-Performing Cities Index ranks many cities, like San Jose, Provo, Austin, San Francisco, Dallas, Raleigh, and Seattle, that have substantial zoning regulations in the top 25 for job growth, wage and salary growth, and economic development, whereas Houston is ranked 68.  On the other hand, the conditions in developments in rural areas without zoning authority, such as colonias in Texas or small towns in Appalachia, are not robust or desirable.  The use of private deed restrictions, private-nuisance litigation, or other non-regulatory means of controlling the harmful effects of land use are notoriously inefficient, ineffective, and uncertain.  And for many, the hassles of seeking zoning approvals do not compare to the hassles of seeking approval from a neighborhood home owners’ association for a fence, screen porch, or the like.  HOAs, with their enforcement of private market-driven deed restrictions (often imposed by the neighborhood’s developer), can be every bit as bureaucratic and even corrupt as local governments.  Private-market mechanisms have been used to discriminate on the basis of race, ethnicity, and class.  Moreover, some kinds of innovative and highly profitable developments that are allowed by zoning code as a matter of right or with minimal regulatory review are not pursued, because the standard cookie-cutter development is viewed as a safer market bet by risk-averse developers.  I’m not at all arguing that we should eliminate private deed restrictions (CC&Rs), HOAs, the nuisance doctrine, private development, or other ways of controlling how we use and develop land.  I’m just saying that all have their problems.  My view is that we should use all the tools but seek to use them in better ways.  In other words, reform zoning (and other approaches too).

 

Third, given the practical problems of eliminating zoning altogether or relying solely on non-regulatory methods, I do believe that hope is a good adaptive strategy.  Psychological studies tell us that hopeful people are more likely to solve problems and improve conditions than pessimistic people.  The kinds of instabilities and uncertainties that concern many, perhaps all, of us on this policy debate will be more likely to be met with adaptive responses if we believe that we can make things better.  I don’t think that this outlook is inherently limited to political Progressives.  There are many conservative or even libertarian agendas for reforming land-use regulation that are quite hopeful.  The future of our communities is too important to be pessimistic about the potential to make our land-use system more equitable and effective.

 

In tomorrow’s post, I’ll explore some ideas about specific reforms that are needed.

I have no idea if people in power have any appetite for reducing zoning regulations. Sadly, I suspect not. But I can suggest some smaller reforms that will at least improve the lot of small businesses. First, eliminate virtually all restrictions on home-based businesses, retaining only those that address noise, odors, night-time deliveries, and things like that. Second, increase the number of activities permitted as of right in all zones, whether through modifying the zone description or applying an overlay that allows both the original zoning plus other zoning. That might mean, for example, a greater variety of businesses in commercial areas or artists being allowed to sleep in their studios. Third, in areas without extremely difficult parking, remove parking requirements for small businesses.  Fifth, change the rules so that businesses that are grandfathered in may make appropriate modifications and renovations without losing their grandfathered status. Sixth, remove restrictions on short-term rentals.  And, for good measure, remove restrictions on garage apartments or using garages for small businesses. That will be good for entrepreneurship, and good for affordable housing as well.

These changes would barely scratch the surface, but at this point, they would still all be an improvement.

For those who lament racism in zoning and land use, I'm sorry, but there's no remedy but to actually allow more development and to make it easier to get approvals for both large-scale and small-scale projects. More housing and more variety of housing in more locations will make areas less homogenous. But governments cannot force people to build things they do not want to build, and government-constructed housing has largely been disastrous. Making it easier and less expensive to build, however, will allow builders to still make a profit on housing that is less expensive for buyers and renters. 

Land use regulations set the framework for local real estate development. I have experienced this first hand as a member of a high-cost city’s planning commission in Alexandria, VA. Our commission’s decisions on land use designations in part determined property values. For instance, if a plot of land was up-zoned or rezoned from single to multi-use, it almost instantly increased in value, regardless of what was on the site. Zoning decisions have significant implications on the price of properties and are tools to potentially segregate or integrate populations since our country suffers from vast racial income and wealth inequalities.
 
For most of the 20th century, land use regulations have been used to segregate people by race and class. The work of Massey and Denton (1993) and Rothstein (2017) effectively demonstrates that federal and local land use decisions, restrictive covenants, redlining, and the placement of public housing, have facilitated the racial segregation of our metropolitan regions.
 
Even though this is the case, I am not for or against land use regulations. Zoning ordinances are policy tools that can be used in a variety of ways. The question is what goal do we want to achieve? I have spent my entire academic career trying to better understand how to facilitate equitable growth that benefits the life chances of low- and moderate-income people and land use regulations can help achieve this even if that is rarely their outcome. 
 
Land use designations can help produce affordable housing in high cost areas through different types of inclusionary zoning policies. A great example of this is the inclusionary zoning policy of Montgomery County, MD (another high cost housing market), which has helped to produce over 12,000 affordable housing units since its inception. I hope cities and counties across the country begin to think more creatively about how certain land use regulations can help facilitate the integration of people by income, race, and ethnicity in economically viable and sustainable communities.
 
Some scholars, development practitioners, and policy makers assume that to produce integrated communities we need to deregulate the land and housing markets to facilitate the production of more units. However, this assumes the economic principles of supply and demand apply to land and housing markets. This is a precarious assumption. Just because the supply of housing increases does not necessary mean the cost will go down. Land (and the housing that sits on it) is a finite resource unlike mass produced products. So deregulation by relaxing land use tax regulations to slightly increase housing supply might not necessarily lead to lower cost housing. 
 
 
Beyond the finite resource of land, other factors distort supply/demand principles in the housing market. Real estate developers (and their financiers) always have an incentive to build (or fund) the highest cost housing they can within the bounds of the market. They also are incentivized to maximize their rate of return. Furthermore, often homeowners will advocate for local zoning that facilitates high cost housing to maintain their property values. Lastly, most political leaders want to increase their city’s fiscal strength, which often means they will lean towards land use policies that they perceive will maximize economic returns to the city’s tax base. These factors (and others) facilitate the production of the highest cost housing the market will bear, regardless of the potential increase in housing supply. In high cost, high demand housing markets, I seriously doubt that land use deregulation will lead to lower cost housing. It will more likely only lead to higher profit margins for real estate developers (and their investors). Thus, we must use the tools of zoning regulation in innovative ways to produce more affordable housing units and the proliferation of diverse, sustainable, and just communities.

The need for reforms to our land-use regulatory system is clear and urgent.  Some communities have already enacted important reforms to zoning and land use regulations, because they are adaptive tools to mediate the dynamics between communities and the places and environments in which we live, work, and play.  In other communities, a lack of political will, among other factors, has created barriers to reform.  In this post, I’ll identify three categories of reforms that I believe are most needed.

 

First, our zoning codes and other land use regulations must be made more equitable.  Reforms should address directly the legacy of racial, ethnic, and class segregation and structural inequalities of our land-use practices and laws.  Richard Rothstein’s recent book The Color of Law describes this legacy.  I highly recommend it; Richard’s powerful history of how government policies and laws promoted and facilitated racial segregation will feature prominently in the Buchanan v. Warley Symposium at the University of Louisville Brandeis School of Law on November 10, 2017, which I mentioned in a previous post. 

 

The problem is quite challenging, though.  The land-use injustices or social inequities that pervade our cities and communities are multi-faceted.  They are manifested not only in housing segregation but also in disparities of exposure to pollution, health inequities, poor planning in low-income neighborhoods of color, and unequal access to green and blue infrastructure (e.g., parks, trees, nature, well-functioning waterways), transportation infrastructure, and economic investment.  They result from not only zoning but also a variety of other government policies (e.g., environmental laws and policies, transportation policies and programs, federal investment in housing) and private actions (e.g., restrictive covenants, housing-market discrimination, bank redlining, industry operations).  The homeless are often ignored in policies that focus on households, and instead are treated as public-safety problems by many cities.  Studies show that low-income communities of color are especially vulnerable to shocks or disturbances.  These can be broad-scale trends like climate change or the global financial collapse of a real-estate investment bubble, or they can be more episodic, like a severe and sustained drought, a major storm event with severe flooding, or political or social upheaval.  Disparate environmental and land-use conditions (including infrastructure) contribute to these unequal vulnerabilities.  There aren’t easy answers.  A  recent study by The City Project shows that the revitalization and restoration of the Los Angeles River aims to bring new green and blue infrastructure and new economic opportunity to neighborhoods with high concentrations of low-income people of color, but the plans and their initial implementation are already producing gentrification and displacement.  This will likely increase, not decrease, inequality.  The City Project and other community partners have called for a variety of ways to protect housing affordability and the existing social networks and culture of these neighborhoods.

 

The answer, I believe, lies in communities addressing inequalities through many different tools and reforms, instead of seeking a single solution.  Complex problems do not have panacea solutions.  Any single major change will have all kinds of unintended consequences.  For example, programs focused on dispersing affordable housing to the suburbs have destroyed important social and family networks that low-income households had in their old neighborhoods, yet programs concentrating affordable housing in the inner city reinforced segregation.  I discussed many different strategies to make land-use regulations and planning more equitable in the American Planning Association Planning Advisory Service Report, Fair and Healthy Land Use: Environmental Justice and Planning – too many to list here.  A few deserve mention, though:

A. Equity assessments of regulations and policies.  Evaluate all regulations, policies, programs, and plans for their impacts on social equity and marginalized communities.  The City Project has an equity planning framework that is based on civil rights principles.  Health equity experts have tools for assessing land-use and environmental decisions for impacts on the health of vulnerable populations.  I have developed a resilience justice assessment tool for evaluating policies, plans, and programs for their impacts on the adaptive capacities and vulnerabilities of marginalized communities, a tool that is being used by the University of Louisville Center for Land Use and Environmental Responsibility.  There are many other good assessment tools out there.

B. Reduce barriers to affordable housing development with permit streamlining, zoning bonuses, relaxed standards for qualifying projects, local tax incentives, subsidies (e.g., publicly-financed green infrastructure and runoff-reducing design and construction in affordable housing projects), and the like.  But don’t eliminate standards and reviews that protect public health and safety, like fire and safety codes, traffic-impact mitigation, and environmental-impact mitigation (e.g., effects on water supplies).  We don’t want low-income kids dying in building fires or from being hit by cars trying to enter or exit ill-planned developments, just in order to save a bit of time and cost on affordable-housing projects. 

C. Invest in low-income neighborhoods and neighborhoods of color in ways that constrain gentrification and displacement, including the use of inclusionary zoning techniques and public-private-community partnerships among government agencies, developers and businesses, and community-based (grassroots) groups.  Also, incentives and subsidies aimed at affordable housing rehab can help to revitalize neighborhoods without forcing out existing residents.  And engage in neighborhood-based planning in low-income communities of color, in which community residents are the major drivers of policies and plans for their neighborhoods.  Some communities have done this well (e.g., East Austin, TX; Little Village, Chicago, IL), but too often low-income neighborhoods of color are either ignored or controlled by local planning officials.

 

The second category of reforms has to do with procedural improvements to reduce unnecessary delays and costs.  Some delays are important to the functioning of the land-use regulatory system, such as when a project is likely to have substantial adverse impacts and more information is needed or when the developer requests a delay in order to revise and improve the project.  However, after having been familiar with the positive effects of California’s Permit Streamlining Act on regulators and decision makers, I have been surprised to find too many other localities where development approvals seem inevitable yet the time for review and decision making is long – and therefore costly to the development project.  Tougher and clearer substantive standards will do more to protect the public health and safety and the environment than costly procedural delays for projects that will inevitably be approved anyway.

 

The third category of reforms is about greater use of performance standards (e.g., performance zoning) and menus of options for developers and property owners to meet these standards, instead of the one-size-fits-all prescriptions of particular land-use features.  For example, instead of dictating that a shopping mall developer use costly pervious pavement for the parking lots, instead adopt a performance standard of zero net increase in stormwater runoff from the site and let the developer choose the methods for on-site stormwater management that make most sense for the site and project.  Zoning codes have been too rigid and too focused on mandating certain forms of land use, instead of adaptively regulating the impacts of land use and development on the surrounding community.  The more that conditions change, often in unexpected ways, and the more that we understand our reliance on ecosystems or green and blue infrastructure (not just “pretty” but essential to the functioning of our economy and health of our communities), the more that we need flexible methods for achieving performance outcomes in our laws and regulations.

Land use regulations tend to be under the purview of local governments, who have little incentive to reform these regulations to address problems that have been identified during this debate. Consequently, reform is likely to have to emanate from a higher level of government, be it the state of federal levels.

 

The federal government could provide incentives for local governments to experiment with land use regulation reforms that encourage development, particularly for low and moderate income households.  The federal government could provide grants and/or tax credits to localities that reform land use regulations.  This would provide some localities an incentive to try fresh approaches to addressing the dilemma created by NIMBYism.

An incentive based approach could be more politically feasible than one that mandates change.  Some on the right might support an incentive based approach because such policies would be deregulatory in nature. If the policies are sold as a way to produce more affordable and moderate income housing, politicians on the left might support this as well.

 

I respond here to Dana Berliner’s uninformed and unsupported assertion that “government-constructed housing has largely been disastrous.” This conventional wisdom is based on a stereotype of the high-rise towers constructed with funds from the 1949 Housing Act, at a time when public housing (previously constructed primarily for the white working class) was stripped of working class families by federal incentives to relocate to single family homes in racially exclusive suburbs. Public housing, which until that time had frequently been economically self-sustaining (from rental income) and therefore well-maintained, then was transformed into a subsidized resource for the poorest families.  Families of modest means whose incomes were nonetheless too high to qualify for subsidy were evicted. Once public housing no longer had a diverse tenant base (including a politically influential middle class constituency), federal and local governments disinvested in the projects and effectively turned them into slums. Prior to the housing constructed with funds from the 1949 Act, public housing was the most desirable housing option available for many lower-middle class white and black families for whom the private sector refused to construct dwellings. When the FHA, in the mid-twentieth century, created a movement of white families from public housing to single family homes in all-white suburbs, the monthly mortgage (FHA or VA) payments made by those families for single family homes were frequently lower than the rents they had previously been paying in public housing. (The 1949 Housing Act, by the way, was adopted after Congress explicitly defeated an amendment to prohibit segregation in public housing, and this defeat was then cited by the FHA as justification for its continued requirement of segregation in government-subsidized private housing. I have laid out this history in detail in The Color of Law. For a primer, you also might begin with Nicholas Dagen Bloom’s 2008 book. Public Housing that Worked. New York in the Twentieth Century.

I do not suggest that public housing should be the primary tool, not even a major tool, to correct the damage wrought by exclusionary zoning, but it should not be discarded as one of many tools that can be employed.

Derek Hyra rightly calls attention to the success of Montgomery County’s inclusionary zoning policy. One aspect of that policy is the purchase, by the county’s public housing authority, of one-third of the affordable units required to be set aside in new developments. This program has proven remarkably successful.

As for other remedies for exclusionary zoning, here is a simple, creative, and radical one, first proposed by University of North Carolina Law Professor John Boger in a law review article 25 years ago. The most powerful and expensive housing program today operated by the federal government is not Section 8, not the Low Income Housing Tax Credit, and not public housing. It is the mortgage interest deduction that serves to subsidize racially and economically exclusive suburban communities. Professor Boger proposed withholding the mortgage interest deduction, and putting the withheld funds in escrow, from homes in jurisdictions that fail to take meaningful steps to desegregate, releasing the funds once such steps were taken. A meaningful step could be, for example, adoption of an ordinance like Montgomery County’s.

Solving this problem is much simpler than developing the will to do it.  Developing the will depends, in part, on understanding how we got into this mess.

I’ll add brief references to other feasible reforms, not necessarily reforms in technical zoning rules, but reforms needed to counter the effects of exclusionary zoning. I and others have made reference to a few of these earlier in this discussion.

* Inclusionary zoning plans, including plans like Montgomery County’s that requires shares of new developments to be reserved for moderate-income (usually) or low-income (rarely) housing. The key to Montgomery County’s plan is that it is county-wide, not limited to a single suburban market. Inclusionary zoning plans based in a single jurisdiction simply shift development to other nearby suburban jurisdictions that lack such inclusionary requirements. Few states outside the South or Border States like Maryland have county-wide governments that can enact such plans, so regional government reform is a precondition for effective inclusionary zoning.

* Fair share plans, such as New Jersey’s or Massachusetts’s (40B), requiring jurisdictions to provide housing for its “fair share” of the low- income population in its broad region. New Jersey only recently began to enforce its plan, having for several decades permitted affluent communities to buy their way out of their obligations by shifting them to less affluent neighboring communities. But recent developments in New Jersey are encouraging; the plan seems to be working. 

* While I said earlier that the largest federal housing program is the mortgage interest deduction, next in line are the two programs for low-income families: the Low-Income Housing Tax Credit (LIHTC) and the Housing Choice Voucher (“Section 8”) programs. Both presently reinforce segregation. Most LIHTC developments are placed in already segregated communities, because land is cheaper there, community opposition does not impede projects, and rental units can easily be advertised to renters already living in the community. In addition, program rules explicitly give bonuses to proposals to develop (i.e. “revitalize”) in already segregated areas. The Section 8 program design also reinforces segregation – in most jurisdictions, landlords are permitted to refuse to rent to voucher recipients, and the subsidy amounts, calculated on an area-wide basis, are too little to permit rentals in middle income (“high opportunity”) neighborhoods and too much to permit rentals in already segregated neighborhoods (resulting in excessive charges by landlords).  Both the LIHTC and Section 8 programs would be easy to reform, were there a will to do so. Inasmuch as the total number of available tax credits and of Section 8 vouchers is limited, program rules could give priority to integration of families into high opportunity areas.  In the last weeks of the Obama Administration, HUD adopted a rule shifting subsidy amounts from lower-cost to higher-cost neighborhoods within a housing area’s jurisdiction. The Trump Administration has notified housing agencies that they should not implement the new rule because the president’s budget would not provide sufficient funds to do so.

I offer a few comments on Derek Hyra's conclusions regarding land deregulation. My experience examining construction data indicates that the laws of supply and demand indeed apply to land and housing markets. Higher cost markets in the United States are typically those in which supply is constrained, either due to geography or local land use policies (or both).

To take one analysis as an example, Glaeser and Gyourko (2002) use data from the Wharton Land Use Control Survey to estimate zoning costs on building (measured as the length of time between an application for zoning and the issuance of a building permit). Their statistical analysis finds that markets in which zoning increases the time required for permit issuance and construction are associated with higher housing prices. And in markets with fewer zoning delays, home prices were close to the marginal cost of construction, which I would note is consistent with a building industry consisting of a large number of competitive firms. These markets tend to have fewer zoning controls and more supply. Profit margins are not increased due to the action of market competition.

I would also note that builders do not have an incentive to build the highest cost housing possible. Builders are profit maximizers like any other enterprise, not revenue maximizers. The construction industry will build what returns a profit in a given market, given demand and local policy constraints. For example, the building market right now is turning toward smaller and lower priced new housing. Initial data finding a downturn in median new home size is proof. Harvard's Joint Center for Housing Studies highlighted this market change in a recent post.

Why is this change happening, compared to the previous increase in new home size? Existing home inventory is tightest in the entry-level market space, and builders would like to add new supply in this market, provided they can balance cost (including regulatory costs and impact fees) with what the market will bear in terms of homebuyer budgets. Markets that have allowed townhouse development, thus allowing greater density, are in the lead for example.

Ultimately, zoning and other forms of land control restrict supply (such as exclusionary and inclusionary zoning). And constraining supply means higher housing prices, particularly for new workers entering a growing job market.

Thanks to our panelists for their thoughtful contributions. 

It’s my sense that there are unexpected areas of agreement for reform, even though panelist assumptions and goals vary. 

This is partly because ideological lines are drawn in far less predictable ways for zoning and land use reform. For evidence, see today’s Vox article, which outlines an unlikely political coalition of affordable housing managers, poverty advocates, real estate developers, and urbanists uniting to reform D.C. zoning through “increasing the overall amount of homebuilding” and “strik[ing] defensive or exclusionary language” in D.C.'s zoning ordinance. Whether or not zoning inspires hope, recent reform initiatives provide hope that diverse groups can work together to reform it.

Our discussion of potential reforms has been comprehensive, but not exhaustive. For example, we did not cover form-based codes or secondary markets for zoning rights. And although Richard mentioned holding the mortgage interest deduction in escrow, we did not discuss permanently reducing subsidies to owner-occupied housing. William Fischel argues that housing subsidies are "most likely the major political basis for excessive land use regulation."

At another time or place, all merit examination. I hope to continue the conversation soon. 

Many thanks to all of you for your posts. I hope everyone will read from top to bottom over all the wide-ranging and thoughtful comments.

There are unmistakable divides among the commentators that reflect longstanding broader divisions within society. Our commentators reflect a range of values that place varying emphasis on broad social goals: personal liberty, economic opportunity, racial and economic justice, environmental protection, the creation and protection of a sense of place and community, and others. Because of these differences, but also because of disputes over whether regulations can work efficiently enough to attain any of these goals, the disagreements will likely continue. I hope they can do so in a clearer way, bringing stronger evidence to bear on questions about the full range of costs and benefits of land-use regulations.

Across the range of opinions, though, one theme stands out most clearly: Now that land-use regulation—zoning in particular—exists, we’re stuck with it. Even the most ardent foe acknowledges that outright abolition just isn’t an option, but even the strongest supporters see that we need to work harder toward regulatory reform.

Does the debate offer suggestions about what kinds of reforms would have broad appeal? I think so: this 100-year-old operating system for land-use change needs to be overhauled to yield efficiency, affordability, and equity. Broadening permitted uses at a time when more businesses can operate safely near housing, reducing parking regulations, and making it easier for local officials to approve individual projects that are consistent with a city or a neighborhood all seem like they’d get broad support from the commentators here. Maybe, in the process, we can move closer on a lot of the goals and values at play in the debate.