Insurance, Risk and Climate Change

Money talks and bull**** walks, as the old saying goes. When it comes to the debate over Global Warming, a formidable quantity of the latter is in evidence. Ideology and partisanship have badly skewed the debate over public policy, as journalists, politicians and special interests on both sides of the debate cherry pick the evidence that fits their preconceived views. I trust relatively little of what I read of the debate as filtered through non-scientists. And I'm even beginning to wonder about the scientists -- they are, after all, beholden to the politicians and special interests for their research funding.

There is one group, however, that I am inclined to trust -- the insurance industry. Insurance companies have skin in the game. Politicians can say anything they want, pass any law they want, and if they get it wrong, big deal, it's only other peoples' money. But insurance companies have a vested interest in accurately appraising the risks associated with Global Warming because, if they get it wrong, they'll end up bankrupt.

That's why I was particularly interested to view the presentation materials supplied by Elizabeth Costle, former Vermont Commissioner of Banking, Insurance, Securities and Health Care Administration and now a resident of McLean, entitled "Impacts of Climate Change on the Insurance Industry" as part of the testimony at the May 13 hearing of Gov. Timothy M. Kaine's Commission on Climate Change.

The insurance industry is increasingly concerned that climate change could increase the frequency and severity of losses from hurricanes, flooding and severe winds. From the likes of Lord Levene, chairman of Lloyds of London, we now get such quotes as: "At Lloyds we do not subscribe to scare stories… We believe that a $100 billion dollar U.S. mega-catastrophe is getting closer for the insurance industry — and it could hit almost anywhere on the Atlantic Coast."

As Costle notes in her slides, "The past may no longer predict the future so the cost of insurance is likely to include a premium for uncertainty." Translation: Insurance premiums will rise. And, if markets are allowed to operate freely, they will rise higher and faster in areas at greatest risk.

One of those places is Virginia. Rates here increased 67.2 percent between 2001 and 2006, compared to 46.3 percent nationally. Ranked by assets exposed to increased flooding from sea level rise, Virginia Beach is the 10th largest coastal city in the country. (I presume that Costle is referring to the Virginia Beach-Norfolk metropolitan area, not the municipality of Virginia Beach.) At least we're not Florida where insurance got so costly, if it was available at all, that the state government stepped in to buffer homeowners from the reality of the marketplace. For the moment, insurance markets in the Old Dominion are still functioning properly.

If Virginia's state-level politicians are sincere about adapting to climate change, as opposed to posturing, they should stop prattling about cap-and-trade mechanisms for capping greenhouse gases -- a decision that will be made in Washington, D.C. -- and focus on what they can influence here in Virginia. At the top of the list: Resist the temptation to meddle with insurance markets as rates rise. High insurance rates send a signal to home builders and home owners: Think twice about where you build.

On a more proactive note, state and municipal government in Virginia can (a) work to protect wetlands, which function as natural buffers against storm surges, (b) stop subsidizing scattered development in areas exposed to rising sea levels, and (c) anticipate the impact on critical infrastructure like highways and power plants. Regarding that last point, a presentation by Chris Munson, senior manager-technology & management solutions for ICF International, was particularly germane. The federal government has begun the process of appraising the impact on infrastructure, including on Virginia. Virginia needs to follow up with more detailed study.

Finally, even though I think the cap-and-trade issue is a federal matter, not a local one, I have to plug a presentation by Noah Sachs, an environmental law professor at the University of Richmond, "The EU Climate Change Strategy: Lessons for Virginia," which considers the European Union CO2 trading scheme in some detail. (Noah is a fellow member of the West End Gentlemen's Eating, Drinking and Bloviation Club which convenes monthly to fulminate on such topics as Global Warming.)

Just one set of numbers from Noah's presentation drives home the argument we've made here at Bacon's Rebellion that there is vast potential for Virginia to shrink its energy/environmental footprint. In 2005, per capita energy consumption in Virginia was 345 million BTUs. In Germany, per capita consumpion was 176 million BTUs. Our standard of living may be higher overall, but it's nowhere close to twice as high. We waste a lot of energy.

The Power of People Networks

One of the key concepts in Richard Florida's new book, "Who's Your City?" is that of the "clustering force," a knowledge-economy phenomenon that reward people for congregating in places where they can network and collaborate with one another. (See "The Clustering Force Be With You.") The need to cluster is impelling smart, creative people to migrate to a handful of "superstar" cities where they can maximize the economic rewards of their talents and skills by pursuing innovative ideas with others like themselves. (See "Mass Migration and Superstar Cities.")

The clustering force is one of the fundamental economic drivers at work in regional economies today. Because it is so ill appreciated, Florida devotes considerable ink to probing and dissecting it. And, because it is so fundamental to understanding the dynamics of regional economies, I devote yet another blog post to the topic.

As Florida observes, productivity and innovation come from face-to-face communication, information-sharing and teaming. Technology, as marvelous as it is, cannot yet substitute for intensive personal interaction.

Social capital is created, writes Florida, when people institutionalize these personal relationships through "bonding" and "bridging." Bonding, he suggests, represents the close ties between extended families and ethnic communities of the type that Harvard political scientist Robert Putnam described and lamented the demise of in his book, "Bowling Alone." Bonding is important for personal satisfaction and happiness, but not necessarily for innovation. Bridging, suggests Florida, is a pattern of interpersonal ties that extends across, and connects, different groups. For clustering and creativity, bridging is what counts.

I've quoted before the insights of Frans Johansson, whose book "The Medici Effect" describes how innovation takes place at the intersection of cultures, disciplines and worldviews. Extrapolating from Johansson, bridging allows people of varied backgrounds to make connections that enable novel combinations of concepts and thoughts. Florida quotes Andrew Hargadon, of the University of California-Davis, as making a similar point.

[Bridging] changes the way people look at not just those different ideas they find in other worlds, it also changes the way they look at thoughts and actions that dominate their own. Bridging activities provide the conditions for creativity, for the Eureka moment when new possibilities suddenly become apparent.

Stanford University sociologist Mark Granovetter writes about "the strength of weak ties." Numerous weak ties do more to foster innovation than fewer, more intimate ties. "The beauty of weak ties is that they bring us new information," explains Florida. Numerous weak ties, if I might elaborate, exposes you to a wider variety of people and ideas. If you limit yourself to talking to the same people, who simply confirm what you already think, you're far less likely to come up with breakthrough ideas.

Florida, ever the coiner of new terms, calls this creative interaction "making the scene." For investment bankers, the "scene" is power lunches or company retreats in the Hamptons. For tech gurus, it's breakfast meetings, beer bashes or bicycle rides. Hollywood has a scene. Nashville has a scene.

Here's the takeaway for Virginia regions trying to build their human capital: Scenes require social and economic infrastructure. Unfortunately, Florida drops that thought and doesn't tell us what the infrastructure is. Picking up on the theme, I would suggest that the "infrastructure" for "scenes" is the existence of networking groups that allow a wide range of people to plug in and connect with one another. Those networking groups may be chambers of commerce or technology councils. They may be clubs like the Tower Club in Fairfax County, or the Bull & Bear Club in Richmond. They may be venture forums, or women's business associations, or young professional organizations, or metro leadership conferences, or tipster clubs.

I would submit a hypothesis: The capacity of a region for innovation can be measured by the number of formal and informal networking organizations that create "bridging" opportunities across the broadest possible spectrum of society. The richer and denser the skein of bridging networks, the more easily ideas can be communicated through a region, the more spontaneously creative ideas will erupt, and the more speedily people can convert novel notions into business opportunities.

Economy 4.0: If Virginia regions want to build human capital, one place they can start is by encouraging the proliferation of networking groups of all shapes, kinds and colors, through which people -- especially those outside the traditional elites -- can share ideas and help make things happen. Openness and tolerance are virtues highly correlated with economic dynamism, as Florida often preaches. Those traits extend bridging networks and exchange of ideas to the broadest possible number of people.

Thanks to a Silent Partner

Today Becky Dale compiled her last daily digest of Virginia transportation/land use clips, a resource that I have leaned upon to keep track of developments across the state. I have owed much of my ability to keep tabs on obscure controversies and trends around Virginia to stories I have picked up from the email that arrives in my in-box every day.

Alas, Becky has decided that she has better things to do for the first hour or two (or more) of her mornings than scour the Internet -- unpaid -- on the behalf of others. (She also compiled a daily list of "open government" articles.) I admire her tenacity in sticking to the anonymous endeavor as long as she did. I owe her a great debt, and she has my everlasting gratitude. Whatever the Bacon's Rebellion blog has achieved over the years is due in considerable part to her efforts.

Thanks, Becky. I don't know what you're going to do with all your free time now, but I hope you enjoy it!

Reading Assignment

I completed my reading assignment from Jim Bacon and wrote my response for a Virginia perspective as installments.

So, here is a reading assignment - an economics book without math. Piece of cake.

"Basic Economics, A Citizen's Guide to the Economy", Thomas Sowell, published in 2000.

Consider to what degree Virginia's public policy issues are based on economics and what that suggests for solutions that work.

Mass Migration and Superstar Cities

The United States has seen at least two great migrations in its history: the great trek of settlers to America's seemingly endless frontier through the end of the 19th century, and then the migration of farmers to towns and cities in the 20th century. The late 20th century has experienced a significant movement of "snowbirds" to the "sunbelt," which continues to a degree, but that arguably pales in significance to the migration of the creative class to what regional economist Richard Florida calls "superstar cities."

In his latest book, "Who's Your City," Florida describes a "mass relocation of highly skilled, highly educated and highly paid people to a relatively small number of metropolitan regions, and a corresponding exodus of traditional lower and middle classes from those same places."

The means migration can be seen in the increasing concentration of college graduates. In 1970, human capital was distributed fairly evenly across the country, with half of all regions clustering within a narrow range of 9 percent and 13 percent of over-25 adults possessing college degrees. Over the past three decades, the percentage of Americans with college degrees has doubled, but the gains have gone overwhelmingly to regions like Washington, D.C., and San Francisco while largely bypassing regions like Detroit and Cleveland.

What's driving the migration? Florida argues that the most talented and ambitious people need to live in the anointed regions in order to maximize their full economic potential. And in a virtuous cycle, the influx of talented and ambitious people spurs the productivity and innovation at the heart of wealth creation. The superstar cities surge ahead economically and cities like Motown figuratively spin their wheels.

While people can live anywhere they want to and plug in electronically in the Internet Age, they cannot plug into the networks that really count: the people networks. To participate in the great waves of wealth creation, people still have to live and work where the wealth is being created. Writes Florida:

When large numbers of entrepreneurs, financiers, engineers, designers, and other smart, creative people are constantly bumping into one another inside and outside of work, business ideas are formed, sharpened and executed, and -- if successful -- expanded. The more smart people, and the denser the connections among them, the faster it all goes. It is the multiplier effect of the clustering force at work.

(For a discussion of the "clustering force," see "The Clustering Force Be With You.")

What, then, are the implications for the themes discussed on this blog? One is that the wealth creators are driving up the cost of real estate, a phenomenon clearly at work in the Washington metropolitan region and to a lesser degree in the Richmond region. Florida explains: "Because the returns from colocation among the ablest is so high, and because high-end incomes are rising so fast, it makes sense for these workers to bid up the price of real estate and accept other costs that traditional middle-class families cannot afford." The result: A metropolitan-wide gentrification in which the wealthy displace the less affluent, literally driving them out of the region.

Regions where the greatest wealth creation is taking place tend to be regions marked by the greatest disparities in income and wealth. Florida regards the "means" migration and the growing gap in incomes to as largely inevitable -- and most distressing.

He also warns that escalating real estate prices can inhibit innovation. Many forms of creative activity -- high-tech start-ups, art galleries, musical groups -- require cheap real estate. If every dingy warehouse has been converted into loft condominiums and chi-chi boutiques, there's nowhere for from-the-ground-up innovation to take place. Extreme real estate prices also hinder the ability of regions to attract new talent.

Says Florida: "When creative, productive regions become the province of affluent people who have already made their money (usually elsewhere), the cycle of local wealth building falls apart."

Economy 4.0: Once again we see that economic development merges into community development. The challenge for most Virginia communities is to figure out how to jump onto that wealth-creation bandwagon. How do we spark the chain-reaction in which regions attract talent, which generates wealth, which attracts more talent? (It can be done. Florida points to the example of Nashville as a city that vaulted from a second-tier music city focused on the country-and-western genre into the third largest cluster of musicians in the country, after New York and Los Angeles, and has eclipsed those two cities as "the place for music writing, recording and publishing.")

The Washington region has already catalyzed its human capital/wealth creation chain reaction, and it's far advanced into the unaffordable housing phase. Washington's task is to preserve and create livable and sustainable communities in the face of the Great Means Migration.

I'll have more to say about these themes in later posts.

A Fresh Look at the Housing/Transportation Crisis

We're all familiar with the housing crisis, and we're all familiar with the transportation crisis. And readers of this blog understand that the two phenomena are hopelessly entangled because many households seeking less expensive housing are willing to trade longer commutes for lower mortgages.

To gauge a region's livability, one cannot consider the affordability of housing in isolation. It is far more meaningful to analyze the cost of housing and transportation together. That is the purpose behind the Housing and Affordability Index created by the Center for Neighborhood Technology for 52 major metropolitan regions around the country.

The map above shows in blue the parts of Hampton Roads where housing/transportation is unaffordable (consuming more than 48 percent of area median income). The map below displays Northern Virginia.

Visit the Housing & Affordability Index website here to view other metro areas and experience the full functionality of the mapping tools. (Hat tip to Jonathan Mallard, who referred me to a post on Buttermilk & Molasses.)

Arlington Gets Antsy about Illegals

Kirsten Downey with the Washington Post framed her story last week about Arlington County and fears of illegal immigration just perfectly:

Arlington County, which prides itself on racial tolerance and economic diversity and has sneered at anti-immigrant policies in nearby jurisdictions, now finds itself facing some of the same questions.

Many longtime residents are voicing fears that a new zoning proposal will bring an influx of immigrants and poor people. Support for affordable housing initiatives is almost an article of faith in the Democrat-dominated enclave, but the proposal to allow rental units in single-family neighborhoods is challenging that orthodoxy.

At issue is a proposal to allow homeowners to add rental units to houses in single-family neighborhoods. Other jurisdictions permit "accessory dwellings" -- garage apartments, granny flats, and such -- and they're touted by New Urbanists as a way to create affordable housing for students, young people, the elderly, domestics, laborers and others without creating income-segregated neighborhoods. By creating more affordable housing close to the Washington region's urban core, the proposal also would allow people of modest means to live closer to where they work, which would eliminate long commutes and take traffic off the region's congested arterial highways.

It makes sense in many ways, but the idea has spurred a vocal backlash among residents who fear the idea would "worsen parking problems, traffic congestion and crowding and increase the number of absentee landlords and illegal immigrants," Downey reports.

Retiree Rick Barry, 75, said that he considers the plan a wrongheaded assault on Arlington's way of life and that he fears it would attract immigrants displaced from Prince William County, which has enacted a crackdown on illegal immigrants.

"You work hard to get your family into a single-family neighborhood," Barry said. "We have a very nice neighborhood character, and we should do whatever it takes to keep it as it is."

Merryl Burpoe, a government relations consultant, said Arlington's "beautiful, stable" neighborhoods are at risk.

"We moved here for the quality of life Arlington affords," she said. "We paid a lot for our homes."

So, here's the big question: Does this mean that the residents of Arlington County, an unofficial "sanctuary" jurisdiction and politically one of the most liberal, bluest-of-blue jurisdictions, are... racist? Are phrases like "overcrowding" and "traffic congestion" and "absentee landlords" just liberal white peoples' code words for not wanting brown people around?

It's one thing to lambaste retrograde attitudes towards illegal immigration when the people allegedly behaving in a retrograde manner are Republican-leaning troglodytes in Prince William County. Clearly, the issues they raise about noise and poor upkeep and too many cars parked in the yard are indirect expressions of prejudice.

Or maybe, just maybe, the clash over illegal immigration really isn't about racism. Maybe it is a clash of cultures, reflecting the difficulty of integrating immigrants (legal or otherwise) accustomed to Third World villages and barrios, where certain norms of behavior are perfectly acceptable, into American suburbia, where those norms of behavior traditionally have been considered obnoxious.

It will be interesting indeed to see how the citizens of Arlington County resolve the tension between accepting all cultures as equally valid -- especially when the foreign cultures reside at a comfortable distance -- with the prospect of those cultures getting up front and personal.

(Hat tip: Larry Gross. The views expressed in this post are those of the author only and do not necessary represent the opinions of the hat tipper!)

Pennsylvania Goes Over to the Dark Side in Transportation Deal

The movement to privatize large sections of state-owned highways is gaining momentum. Citigroup Inc. and Abertis Infraestructuras SA have won an auction -- paying $12.8 billion -- to lease the Pennsylvania Turnpike from the state of Pennsylvania for 75 years. Money from a turnpike lease would help the state close a $1.7 billion gap in transportation funding.

Terms of the lease agreement, if it gets final approval, would allow the operator of the turnpike to raise tolls by 25 percent Jan. 1. Tolls then would increase 2.5 percent annually or match the rise in the consumer price index if it is higher, according to Bloomberg.com.

The Bloomberg article makes no mention of improvements to the turnpike or the use of congestion pricing to maximize throughput. Based on the details published in the article -- I reserve the right to retract my analysis if the reporting is incomplete -- this looks like the wrong way to go about privatizing a state highway. Basically, the privatization here is a back-door way to jack up rates on one set of drivers (those who use the Pennsylvania Turnpike) in order to underwrite transportation improvements to other parts of the state. In this instance, privatization is a tool used to perpetuate Business As Usual transportation policies.

This deal does not take Pennsylvania toward a user-pays system. It looks like an old-fashioned money grab by the political elites in Pennsylvania. There are no discernible signs of added value for turnpike drivers. There are no indications that the tolls would be fine-tuned to encourage drivers to seek transportation alternatives during periods of peak demand. Tolls are hiked willy nilly to meet the needs of investors and the state of Pennsylvania.

By comparison, the deals that the Kaine administration has struck with private sector entities to build HOT lanes on Interstates 495 and 95/395 look vastly superior. In those deals, congestion pricing will maximize throughput and incentivize drivers to find alternatives during periods of peak demand. Money raised from tolls will be plowed back into major upgrades of the Interstates, including Bus Rapid Transit, thus expanding the alternatives to one-man-one-car. People paying the tolls in Virginia will receive tangible benefits for their money. History will show the HOT lane deals to be the signature transportation achievement of the Kaine administration.

(Hat tip to Neil Haner.)

Creative Thinking on Hampton Roads Transportation

It's amazing what happens when you deprive a region like Hampton Roads of the easy solution -- raising taxes -- for reducing transportation congestion. People come up with some pretty creative ideas. Not all of them will prove viable, but some of them will. And none of them would have surfaced if the General Assembly and local politicos had been allowed to continue unchallenged their tax-and-spendthrift ways.

The latest case in point: New Kent County, which lies between Richmond and Hampton Roads, is studying the feasibility of building a cargo-transfer facility to take trucks off Interstate 64 and spur business development, reports the Daily Press.

The idea under study is to ferry cargo containers from the ports in Norfolk and Portsmouth through the Chesapeake Bay, under the Coleman Bridge and then up the Pamunkey River to the proposed port property. The enterprise would take trucks off the most congested and costly-to-expand stretches of Interstate 64 in Hampton Roads.

The privately owned site, called Parham Landing, is a largely vacant parcel on the south bank of the Pamunkey, about four miles from Interstate 64. The cost of the transfer facility is estimated to be $36 million to $53 million. It's not clear at this stage whether private investors or a public entity would pay to build it. But one thing for sure would undermine the project: Opening up the spigots of taxpayer funding for Business As Usual transportation remedies.

Remember, traffic congestion creates business opportunities. The lure of profit calls forth creative ideas.

(Map credit: Jon Baliles. Blue marker shows location of Parham Landing. Click on image for larger, more legible version.)

Cultivating Creativity

The Richmond region was not known in the 20th century as a center of either productivity or innovation. Our region was more prosperous than the national average, but it never stood out as a paragon of anything. Among Southern cities, it was eclipsed by Atlanta, Charlotte, Raleigh, Nasvhille and a half dozen cities in Texas and Florida. But the 21st century may tell a different story.

This evidence is anecdotal. But three new initiatives have emerged on the scene here in Richmond -- the da Vinci Center at Virginia Commonwealth University, the Virginia Biosciences Commercialization Center and the Virginia Business Excellence Consortium -- that are qualitatively different than anything our region has seen before. At long last, the Richmond region is birthing institutions that focus on productivity and innovation, the only enduring sources of competitive advantage in the global economy.

I'll be profiling the second of those groups within a few days, and I hope to dig into the third eventually. Here's a short version of the first, the da Vinci Center, as capsulized in "Cracking the da Vinci Code" which I wrote recently for R'Biz:

A hospital operating table in the United States costs around $40,000. An operating table in Bangladesh can run between $5,000 and $30,000, depending on whether the hospital can spring the cash for a Western model or has to settle for a cheaper Chinese version. Even at the discount price, hospitals in the impoverished South Asian country -- or in many other developing countries, for that matter -- can afford only one.

Hoping to bring operating tables to the masses, a team of Virginia Commonwealth University graduate students wants to design, build and ship a table for $500 -- one tenth the cost of what it takes the Chinese to deliver one. The only way they can possibly succeed is to approach the problem from a radically different perspective.

That's the kind of challenge that VCU's da Vinci Center for Innovation in Product Design and Development thrives upon. A joint initiative of the schools of business, engineering and design sponsored by seven major Richmond-area corporations, the program teams students from different disciplines as a way to stimulate creative, inter-disciplinary thinking.

In a formal presentation [recently], Seule Kabir, Hitesh Patel and Jennifer Farris chronicled their effort over the past semester to crack the code: adapting off-the-shelf components already mass produced at very low prices, and shipping the tables in a "flat pack" mode that requires some assembly on site but saves on distribution costs.

Mike Troy, a consultant for Stryker Communications, Dallas-based designer of operating tables, says the team came up with some very promising ideas. He particularly liked the flat-pack recommendation, although he suggests that outsourcing manufacturing to China may have pitfalls the students haven't considered.

By general agreement, the design solution seemed promising enough to move to Phase Two: detailed mechanical and engineering drawings, material development and more detailed market research. Kabir, a native of Bangladesh, is motivated to see the project through to commercialization, if it can make it that far. Whether the students succeed in designing a marketable product or not, they have engaged in an incredible learning exercise.

As one VCU professor noted after the presentation, "This is not about the table. It's about learning how to solve problems."

To read a more complete treatment of the da Vinci Center (my column this week in Bacon's Rebellion), read "Cultivating Creativity." As I explain there, what makes the Center different from any other program in the country is that it combines the disciplines not only of engineering and business but of design. The Center has seven corporate sponsors willing to pony up $30,000 to advance the art of product development at VCU and, hopefully, recruit the talented young people emerging from the program.

Product development creates more wealth than almost any other economic activity. If Richmond businesses can learn to excel in this arena, they could create unprecedented opportunities for the region.

A NOTE FOR TOOMANYTAXES:

TooManyTaxes (aka, TMT) posted a number of comments on the Jim Bacons “The Transportation Debate and the Unreported Land Use Revolution” submission below.

TMT is right about the Dillon Rule, wrong about Greater-Warrenton Fauquier and the future of the 9 Beta Communities that fall all or partly in Fairfax County.

Greater-Warrenton Fauquier already has planned urban enclaves with more space than there is a foreseeable market in the next 50 years.

Citizens and the leadership of Greater-Warrenton Fauquier, when presented with the options in an intelligent manner, would like to have Jobs and Services to Balance the population now living in the Beta Community.

Moreover, they would love to have new Jobs and Services to create a real Balance within the Clear Edges around the urban enclaves aka "Service Districts" that are planned.

What they have been getting over the past 50 years is an increasing flood of scattered urban dwellings and orphan subdivisions. Most of these new urban residents with jobs in the Core are here because of the programs, projects, policies and controls of federal and Commonwealth Agencies and especially the municipal Agencies inside the logical location of the Clear Edge around the Core of the Subregion. Fairfax County is a poster child for the causes of Community, Subregional and Regional dysfunction.

In recent times the wrong sized houses in the wrong locations of Greater Warrenton-Fauquier have been joined by a tide of Business-As-Usual chain stores with more on the way. Not to worry. Some of those under construction in the US Route 29 Corridor will never open and / or soon close. They were “planned” based on a continuing flow of “commuting” residents. That will stop for the reasons we spell out in today’s column. “Three Little Words.”

What has happened in Greater Warrenton-Fauquier has happened across the National Capital Subregion. Especially in the Virginia part of the Subregion there are grossly dysfunctional settlement patterns. These patterns and densities of land use are exacerbated by the least-common-denominator actions TMT points out vis a vis The Rule in Dillon’s Case.

If TMT wants to help he could organize his friends to push for the evolution of a Balance of J / H / S / R / A in each METRO station area and most VRE station areas.

He and his friends could push for much higher parking fees for METRO parking lots. They could support the movement from flat rates and general taxes to fee for services.

What most citizens of Fairfax County call “Quality of Life” is based on an inequitable distribution of the costs of location variable goods and services and reflect the policies, programs, projects and controls noted above.

Not to worry, life as TMT and his cohorts have known it is going away for the reasons noted in “Three Little words.”

Instead of suggesting the further spread of dysfunctional human settlement patterns, TMT needs to lead the charge for a Fundamental Transformation in Fairfax County settlement patterns before it is too late.

We will be happy to send along the 11 Strategies for shaping a functional and sustainable future in Greater Warrenton-Fauquier. They are not that much different from the ones needed in Fairfax County and the rest of the Washington-Baltimore New Urban Region.

Good luck.

EMR

PS: Getting rid of the Rule in Dillon's Case will do no more to improve human settlement patterns in Virginia than doing that has done in other states. It takes Fundamental Transformation in governace structure to achieve Fundamental Transformation in human settlement patterns.

And the Trumpets Did Sound

And the clarions called forth, and the Bacon's Rebellion e-zine did respond to the call, bringing truth and understanding to a benighted land.

You can read the May 19, 2008, edition in all its glory, including a list of hottest blog postings over the past two weeks, by clicking here. Or you can just scroll down an inch or two and just read the latest columns. Unless you read this blog every day, make sure to sign up for a free subscription so you never miss an issue of the e-zine.

Cultivating Creativity
The da Vinci Center at Virginia Commonwealth University is elevating product development to an inter-disciplinary art. It may well be the future of American innovation.
by James A. Bacon

Three Little Words
The phrase "no cheap energy" embodies an economic reality that is shaking the foundation of First World Civilization. But citizens and politicians still act as if they can ignore it.
by EM Risse

A Simple Solution
Here is an easy way to resolve Virginia's political stand-off over transportation funding: Empower local governments to enact the same taxes that the Supreme Court invalidated regionally.
by Michael Thompson

So Much for Transparency
Throwing a bunch of budget numbers onto a website does little to improve local government transparency. The adage "Garbage In, Garbage Out" applies in spades.
by Norman Leahy

The Weird World of Massey Energy
Controversial, Richmond-based coal firm enjoys energy boom times while wielding political clout and beating back critics with an in-your-face style.
by Peter Galuszka

Nice & Curious Questions
And What Happened Here? Historical Markers of Virginia
by Edwin S. Clay III and Patricia Bangs

The Transportation Debate and the Unreported Land Use Revolution

If you need a reminder of how the debate over transportation funding is totally detached from the real world, read the op-ed piece by Del. Clay Athey, R-Front Royal, in the Times-Dispatch today to re-establish a connection with things happening beyond the cognition of most state politicians and the reporters who cover them. Athey, as you may recall, was the main author of the oft-forgotten land use provisions of the infamous HB 3202 known primarily for Abuser Fees and unconstitutional regional transportation authorities.

The land use provisions of the bill seem to be holding up better than the road-funding pieces, even if their impact has yet to be fully felt. The legislation called for the creation of Urban Development Areas that would steer growth in fast-growth counties into districts where jurisdictions were prepared to concentrate their investments in roads and infrastructure -- and allowed localities to assess impact fees to help pay for it.

Local governments are still in the process of putting the law into effect. Yet this process is largely invisible to the public because the Mainstream Media refuses to cover it.

This massive blind spot in media coverage amounts to journalistic malpractice. Not only is the most important local-governance reform of the past 50 years going unreported, the media is skewing coverage of the transportation funding debate, unwittingly providing cover for Gov. Timothy M. Kaine who has called a special legislative session in the hopes of raising $1.1 billion a year in new taxes. Political reporters are uncritically regurgitating claims that Virginia is running out of state money to build secondary roads and depicting Republicans as anti-tax Neanderthals without providing the critical perspective that, oh, by the way, the financing and administration of transportation at the level of local government just happens to be going through the most dramatic, friggin' changes in the past half century!

In case you've forgotten the coverage that Bacon's Rebellion provided a year ago, here is a refresher from Athey of what is going on:

[Sixty-seven fast-growth] localities now have the authority to set road impact fees on by-right development outside of designated Urban Development Areas. This change helps pay for transportation improvements resulting from new by-right development, encouraging localities to focus growth and address mobility needs as development occurs. ...

[A] second land-use provision in HB 3202 gives large urban counties flexibility to assume responsibility for maintenance of their local roads within an "Urban Transportation Service District." By ending the separation of land-use decision-making from the responsibility for road maintenance, this change is a crucial first step toward devolution of state responsibility for secondary roads that serve only a local function to the governments whose land-use decisions result in congestion.

To encourage localities to provide this service, those counties -- in addition to receiving state payments -- would be authorized to assess full impact fees to help pay for additional public facilities like roads, public safety, and schools.

Got that? An alternative financing mechanism to pay for building secondary roads already exists. One of the reasons that General Assembly Republicans are adverse to new taxes is that HB 3202 significantly has already increased the ability of local governments to raise funds through impact fees. The refusal to pile on new taxes before the impact of last year's legislation is understood does not make the Republicans anti-tax Neanderthals.

Athey and Del. Robert G. Marshal, R-Loudoun, authored legislation that will conduct a two-year study to monitor the transition to Urban Development Areas, determine if additional legislation is needed to help localities as they make that transition, and evaluate all existing land use planning tools and infrastructure financing options. Of course, these facts are unknown to the public because the Mainstream Media has not deemed it worthy of coverage -- if, indeed, these facts have even entered the consciousness of Virginia's editors and reporters.

If Virginia's newsroom executives had any conscience, they would quit their jobs in shame, retire to monasteries, flagellate themselves with whips, and beg a merciful God for forgiveness.

I confess: I, too, was guilty of overlooking this side of this story, at least momentarily. Bacon's Rebellion reported the Urban Development Area (UDA) story extensively a year ago, but we've let it drop since we lost our sponsorship funding. Since then, unable to report the news ourselves, we have have fallen into the habit of relying upon the reporting of others. Thus, I criticized Republicans last week for offering no alternative to Gov. Kaine's tax plan. (See "Beyond 'Just Say No to Taxes.'")

But I now recant. While I do not think that the messy business of land use reform is anywhere near complete, UDAs and their associated impact fees will have a huge impact on land use and transportation. We should wait and what kind of job they do before adding another load of taxes to the mix.