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Zoned Out: Legally Enforced Segregation
From _Reason_ magazine, May 1990:
Zoned Out: How an Effort to Protect the Health and Welfare of Neighborhoods
Has Become Legally Enforced Segregation.
By William Tucker
Anyone who has spent more than a month observing suburban or small-town
politics knows that the vast majority of today's municipal controversies
revolve around issues of zoning and planning. Go to a town meeting anywhere
in the United States and you are likely to find a virtuous local majority,
struggling to protect environmental amenities and "quality of life," pitted
against a "greedy developer" whose sole joy in life is to rape and pillage
landscapes. As the meeting progresses, a long procession of homeowners will
step to the microphone, voices quavering with emotion, to charge that the new
development - whatever it may be - will "only bring in more traffic, create
pollution, ruin the quality of our lives, and turn this town into another [the
name of the nearest large city]."
Public-opinion surveys regularly purport to show that Americans are most
concerned about global issues such as the federal deficit and relations with
the Soviet Union. Yet I would bet that if a category were included entitled
"preserving the quality of life in my neighborhood," it would rank at or near
the top as well.
Briefly, here is the way zoning works. A community draws up a map in which
each parcel of land is designated for a specific kind of use - residential,
commercial, industrial, and so forth. In principle, a town is supposed to be
willing to entertain any of these uses but is anxious to keep them in their
proper place. Commercial development should occur along major highways, and
industrial development should adjoin a freeway interchange or railroad track.
Apartments will be clustered near polulation centers, while single-family
homes will spread through the network of residential streets.
In practice, however, what politicians and municipal planners soon discover is
that there are some land uses nobody wants to have anywhere. Noisome
industries are never popular. A few local stores may be tolerated, but large
regional shopping centers are viewed warily. In addition, no suburban
community wants any trace of "cheap housing" - apartments, multifamily homes,
mobile homes, or anything involving rentals or tenants.
Whenever a developer comes forth with such a proposal, no matter how rational
or legal it may be, local officials are put under enormous pressure to prevent
it from being built. If the developer needs a zoning change, municipal
officials will be urged to reject it. If the use is permitted by the
ordinance, officials will be encouraged to "downzone" the property or find
some loophole to prevent the development. Another favorite municipal strategy
is to zone properties for "light industry," "laboratories," or some other
high-sounding but unlikely development. In this way, the community can reject
any proposal on the grounds that it is waiting for some "higher" use.
All this has had an enormous impact on housing itself. "Zoning is now the
most critical factor in the entire equation of home building," says Shirley
McVey Wiseman, 1989 president of the National Association of Homebuilders.
"What gets built, where it gets built, how much it's going to cost - all this
is now basically determined by the regulatory apparatus at the local level.
As these regulations have become more burdensome, housing has become more
scarce and expensive."
---
To take a typical case, let us look at a property in Brookhaven, Long Island,
a 349-square-mile township that is the largest in New York state. In 1980 the
Suffolk County Interreligious Council on Housing proposed 160 garden
apartments on 30 acres of land in the village of East Patchogue. The
council's express intent was to provide housing for low- and moderate-income
people who were otherwise not able to find housing in the region. The parcel
was already zoned for a nursing home. Nobody had ever proposed building a
nursing home on the site, but the zoning classification made it seem as if the
town were not opposed to all high-density uses.
The town planning board, an appointive body with only advisory powers,
approved the zone change. But the town council, which has final authority and
is under far more plitical pressure, rejected the project because of its high
density. The Interreligious Council came up with another proposal to put 60
units on a 12-acre site in nearby Setauket, along heavily traveled State
Highway 25A.
As word of the second proposal spread through the township, opposition
mounted. By the time the town council got around to voting in 1983, there
were enormous public pressures against approving the project. Although the
planning board also recommended the second proposal, the council voted against
it as well. No housing would be allowed. "We don't like low-cost housing
because it brings in low-class people," one neighborhood resident told the New
York Times. "I don't want those people coming in and degrading my property.
I've got my life savings invested here. There's plenty of land elsewhere."
Another area where zoning has had an enormous impactis in the rental of small
rooms and apartments in single-family homes. Census data indicate that more
than half the homes in the country with five or more rooms are beign occupied
by people over age 65. The data suggest that many of these people are
"overhoused," meaning they have fer more room than they need. Property taxes
and the difficulty in maintaining such a home often persuade elderly people to
move to smaller units. Another alternative would be for the overhoused people
to rent out spare bedrooms or small living units.
Zoning laws generally forbid this. Suburban residents in single-family
districts are extremely sensitive to the idea of living in "rental" districts.
Complaints often center on densityor parking space, but the objections
obviously have to do with class distinctions as well. This prohibition
against rentals is probably the major reason that the suburbs have never been
able to provide the variety of housing that the city neighborhoods do.
---
To see what a difference these regulations can make, consider the case of
Takoma Park, Maryland, a suburb of Washington right on the District of
Columbia border. Takoma Park represents a paradigmatic confrontation of the
old streetcar suburbs and the new suburbia based on property valuse and
single-family homes. First incorporated in 1883, Takoma Park was originally
connected to Washington by a network of rail lines. Though it became a
streetcar suburb, it had small pockets of black freemen, who had settled in
the area right after the Civil War.
Most of the original housing was tow- and three-family homes, with both
owner-occupied units and rentals. During the 1920's and '30s, a number of
larger apartment houses were built as well. After World War II, the single
family home became predominant. Today the streets of Takoma Park are a
hodgepodge of housing: single-family homes, apartment houses, duplexes, and
triplexes, many of them "nonconforming uses" that do not accord with the
current zoning plan.
Despite the growing number of single-family homeowners among the population of
16,000, rentals continued to play a large role in the community. When
thousands of army and government personnel came to Washington during World War
II, homeowners in Takoma Park rented them apartments. When vetrans used their
G.I. benefits to attend neighboring Columbia Union College, they also became
tenants. The demad was so high that many homeowners divided their homes into
apartments or rented rooms.
In 1973, however, the more affluent single-family homeowners decided they had
had enough. Researching the zoning law, they discovered a 60-year-old
Montgomery County statute forbidding rentals in a single-family zone. The
homeowners petitioned the county (which controls zoning in Maryland) to
enforce the law.
In 1978 the city council adopted a compromise, saying that anyone who had been
renting before 1954 could continue for another 10 years. The 10 years expired
in 1988 and evictions began. An extimated 1,000 tenants, many of them
families with children, are expected to be forced out of their rooms and
apartments.
---
What is the overall result of these zoning practices? Obviously, housing
becomes more expensive and harder to find. In 1987 the _New York Times_
reported: "They began arriving 10 days ago, dozens of people on the
condominium trail. In warm sun and then cold rain, they lived in a community
of cars, campers and trucks, assuring themselves a chance to pay $175,000 and
up for one of the 100 town houses that will become Society Hill."
The condominiums - in Mahopac, New York, 90 minutes commuting distance from
Manhattan - were still five months from completion. But most buyers said they
couldn't find any other housing in the New York metropolitan area. Residents
of Mahopac, who for a while had mistaken the temporary site for an invasion of
homeless people, were not as enthusiastic. "Earlier this week," notes the
_Times_, "over 700 residents signed a petition asking town officials to impose
a moratorium on all building permits. Those officials are already considering
a plan that will reduce development densities and limit the rate of growth."
The great dilemma is that for people who have already bought homes and are
established in the community, the ability to exclude others and raise the
price of homes is a cost-free good. The key factor to recognize is that in
addition to providing themselves with a place to live, homeowners are also
investors, speculating in real-estate prices. Particularly in an
inflation-prone economy, people now buy a home as a way of saving and
investing money. Once they have their life savings invested in a home - and
they often do - homeowners want to do everything possible to protect their
investment. That means preventing cheap or undesirable development nearby.
Of course, there are few investors anywhere who do not want to have the power
of the government brought to bear to protect their investments. Farmers want
agricultural price supports, manufacturers want protection from imports,
savers want the federal government to insure their bank accounts. Homeowners
are different in that, within any given political jurisdiction, they are
likely to be the majority. The voice of each homeowner protecting his or her
investment is immediately echoed by the voice of every other homeowner
protecting his or her investment. In such a situation, it is only a matter of
time befor the majority convinces itself it is doing the Lord's work.
Thus, concerns about "affordable housing," when expressed by homeowners,
always have a certain disingenous air. The fact is that for people who
already own a home, it does not matter much how high home prices may climb.
They are already on the escalator. If prices go up, theirs will go up along
with everybody else's. Their ability to trade for a better home is not
compromised. It is only people who have not yet gotten their feet on the
escalator who see prices vanishing into the empyrean. Because these people
are not usually represented in municipal decisions and are generally an
unorganized minority, their influence is not felt.
"People always cite the National Association of Realtors affordability index,
which says that in California, for example, only about 15 percent of the
state's households can afford the median-priced home," says William Fulton,
editor of _California Planning and Development Report_. "What that doesn't
tell you is that half the households in California already own a home. They
won't benefit if home prices come down. In fact, they'd be just as happy to
see the prices go up."
---
As long as this majority is able to control where and how new housing will be
built, the situation is unlikely to change. Carl Dahlman, professor of
economics at the University of Wisconsin, puts it this way: "The only theory
of zoning that is consistent with available knowledge of zoning practices is
that zoning is a means for keeping people out, and for sending them away to
other communities for the residents there to cope with. Zoning in America
today is done not to specifically control land, but primarily to control the
migration of people."
To see how things could be different, it is only necessary to look at Huston,
America's fourth-largest city. Because of the city's wild-west atmosphere and
antigovernment attitudes, zoning has never been adopted in Huston. City
officials rejected zoning several times during the 1920s and '30s. It was
also voted down in two nonbinding public referenda in 1948 and 1962. Although
people on the East and West coasts often find it hard to believe, property
owners in Houston can do anything the please with their property.
Well, perhaps it isn't all that easy. In fact, as Bernard Siegan discovered
in his landmark study of Houston's no-zoning policies in 1972, property owners
are often severely restricted - not by publicordinances, but by private
covenants and deed restrictions. Typically, the developer of a suburban
subdivision will write deed restrictions saying the property cannot be used
for anything but single-family residences for 30 to 50 years. (In fact, banks
won't even lend money for such developments unless the restrictions are in the
agreement.) As a result, Houston has its own exclusive residentail enclaves
such as River Oaks and Sharpston. The difference is that these people in
these ritzy developments cannot prevent someone else from putting up cheap
housing on the other side of town.
Thus, while Houston's exclusive subdivisions compare for snob appeal with any
other enclave in the country, the city is bursting at the seams with every
other kind of housing as well. In 1982, in the teeth of the recession, the
Houston area built 60,000 new homes - one of every 15 new unity in the
country. Despite enormous population growth, rental vacancies have remained
above 15 percent for more than a decade. Condominiums and starter homes still
sell for $30,000 (that's the asking price, not the down payment), and
homelessness has been extremely low, although not non-existent. In fact, one
of the major housing proplems in Houston has been vacan suburban homes, which
have led people to worry about "suburban slums."
One other interesting observation is that whenever there has ben a ground
swell in Houston for imposing zoning, it has always come out of the most
affluent neighborhoods. In the 1962 referendum, 75 percent of the black
population voted against zoning, while its only support came from exclusive
suburbs.
---
Another city that has at least relaxed its zoning effort and seen a payoff in
housing is San Diego. The nation's seventh-largest city, San Diego has
experienced tremendous growth over the last two decades, expanding from
334,000 inhabitants in 1950 to 960,000 today. Almost 15 percent of the
population is Hispanic, due largely to its location right across the border
from Tijuana - with 1 million people of its own - which makes San Diego a
center for illegal immigration.
During the recession of the early 1980's building slowed and rental vacancies
dropped to 4 percent. In 1985 there was a referendum campaign to adopt rent
control, as more than a dozen other California cities had already done. San
Diego voters rejected it 2-to-1, and builders responded in 1986 by putting up
200,000 new apartments, most of them in the luxury category. The results were
quickly felt in the lowest income groups. The proportion of vacancies among
apartments renting for less than $250 a month doubled between 1985 and 1986,
from 1.8 percent to 3.6 percent. The filtration process worked extremely
rapidly.
Still, the gentrification of the old Gaslight District downtown threatened to
create a wave of homelessness. "Several SRO hotels were lost, and the
charitable organizations serving the indigent were really getting kicked
around down there," recalls Frank Landerville, director of the Regional Task
Force on Homeless.
At first, the city responded with a law saying that when builders knocked down
one SRO unit they had to put up another. This requirement expired after three
years, however, and served only as a stopgap. By that time, city officials
had decided that the real problem was zoning.
"We realized our zoning law had created a gap in the kind of housing builders
could provide," says Judy Lenthal, senior planner for the city government.
"An SRO unit is too small for permanent accommodations, while a studio
apartment is more than many people can afford.
"So we changed the zoning ordinance to allow a new 'living unit' - an
apartment that contains either a kitchen or a bathroom, but not both. You
have to share one or the other in a common area. But it's a real home -
something both landlords and tennants can afford."
As a result, San Diego has experienced what Lenthal calls "the only miniboom
of new SRO construction in the country." In one year, private developers
built four new hotels and rehabilitated 15 old ones, creating 565 new units.
Plans for 1,500 more units were on the drawing boards. San Diego legislators
also sponsored a state law to enable other California cities to do the same
thing.
"Altogether, I'd say the most important thing we've done in providing housing
for the poor is not alienate the development community," says Landerville.
"Builders are still enthusiastic about San Diego and that helps provide
housing at all levels." Perhaps not coincidentally, San Diego has one of the
lowest rates of homelessness among the nation's 20 largest cities.
---
In most other parts of the country, however, the trend has been in the
opposite direction - toward greater restriction of the housing market through
tighter zoning.
In 1974 the U.S. Supreme Court reaffirmed zoning powers in its first
comprehensive zoning decision since 1926. The village of Belle Terre, Long
Island, had passedan ordinance forbidding three or more unrelated people from
renting detached homes. The ordinance was aimed at students from the nearby
State University of New York at Stony Brook who had pooled their resources to
rent homes in the area. A group of students challenged the ordinance.
In a decision that united liberal Justice William O. Douglas and conservative
Chief Justice Warren Burger, Justice Douglas wrote: "A quiet place where
yards are wide, people few, and motor vehicles restricted are legitimate
guidelines in a land use project addressed to family needs.... The police
power is not confined to elimination of filth, stench, and unhealthy places.
It is ample to lay out zones where family values, youth values, and the
blessings of quiet seclusion and clean air make the area a sanctuary for
people."
As Carl Dahlman, of the University of Wisconsin, puts it: "[The courts] have
... wrapped many residential neighborhoods consisting of single-family homes
in a protective blanket that effectively has eliminated much or perhaps all of
the pecuniary risks associated with the ownership of a home."
Since 1975, however, there has been one successful challenge to exclusionary
zoning, in the New Jersey courts, that has served as an example for other
states. The case involved Mt. Laurel, a 22-square-mile suburb of Camden
about 15 minutes from Philadelphia. Still largely rural, the town does not
yet have a main street or a supermarket. Its first post office was
constructed in 1983. In 1965, the townshop contained only 8,000 people.
Interstate 295 opened up suburban development, however, and the population
grew to 17,000 by 1980. More than 3,000 new housing units - all single-family
homes - were built in that 15-year period. In addition, the town sited 50
acres of new offices and industrial parks on land adjacent to the intersection
of Interstate 295 and the New Jersey Turnpike.
Mt. Laurel also has a small black settlement that traces its origins to the
Civil War. For decades the blacks worked as tenant farmers. As suburban
development ate up farmland, the retreated to a small community of summer
cottages in the Springville section. By 1969, only 120 people remained there.
The town refused to extend sewer lines, water service, or paved roads into the
area. The houses were labeled "nonconforming uses," meaning they could not be
remodeled, replaced, or repaired if significantly damaged. Occasionally, the
town would condemn a building. Springville residents saw quite clearly that
they were being driven out of town.
In 1969 a group of them formed the Springville Action Committee. Securing a
state grant, they proposed building 100 apartments on a three-acre parcel in
Springville to house most of the black population. The town turned down the
proposal on the grounds that it violated the zoning ordinance, which allowed
only single-family homes on half-acre lots. The Burlington County NAACP sued
the town in the state court.
---
In 1975, the New Jersey Supreme Court overturned Mt. Laurel's ordinance and
ordered the town to zone some of its land for apartments. Moreover, the court
extended its decision to cover all "developing" communities in the state and
said that they would have to make similar provisions for low-income housing as
well.
Mt. Laurel's response was typical of municipalities in similar positions. It
rezoned three small parcels for apartments, *but not the property of the
successful litigant.* One of the parcels was already being subdivided for
homes. The other two were swampy and inaccessible. All three owners said
they had no interest in building apartments or cheap housing.
Meanwhile, other towns around the state began resisting the Mt. Laurel
decision by arguing that they were not "developing" communities but were
either already developed or not even considering development. As a result,
eight years after the first Mt. Laurel decision, no new housing had been
built.
Springville Action went back into court. In 1983, after two years of
deliberation, the New Jersey Supreme Court handed down "Mt. Laurel II," a case
that has been called the most significant zoning decision since 'Ambler Realty
v. Euclid,' the 1924 case in which the U.S. Supreme Court upheld zoning as an
exercise of the state's "police power." The New Jersey court wrote: "The
constitutional power to zone, delegated to the municipalities, subject to
legislation, is but one portion of the police power and, as such, must be
excercised for the general welfare.
"When the exercise of this power by a municipality affects something as
fundamental as housing, the general welfare includes more than the welfare of
that municipality and its citizens: it also includes the general welfare - in
this case the housing needs - of those residing outside of the municipality
but within the region that contributes to the housing demand within the
municipality."
The court conjured up an image of what the state would eventually look like
exclusionary practices were allowed to go unchecked: "poor people forever
zoned out of substantial areas of the state, not because housing could not be
built for them but because they are not wanted; poor people forced to live in
urban slums forever not because suburbia, developing rural areas, fully
developed residential sections, seashore resorts, and other attractive
locations could not accommodate them, but simply because they are not wanted."
The court decided that the state government would be the ultimate authority on
zoning. "The state controls the use of land, *all* of the land. In
exercising that control, it cannot favor the rich over the poor. It cannot
legilatively set aside dilapidated housing in urban ghettos for the poor and
decent housing elsewhere for everyone else. The government that controls this
land represents everyone. While the state may not have the ability to
eliminate poverty, it cannot use that condition as the basis for imposing
further disadvantages."
As specific remedies, the court stated that municipalities must follow one of
three strategies: 1) encourage or require the use of availavle federal and
state housing subsidies for the construction of low-income housing; 2) provide
incentives for or require developers to set aside a portion of their
developments for low-income housing; or 3) zone areas for mobile homes or
extremely small units that can be sold to low-income people.
---
In 1985 the New Jersey State Legislature responded to all this prodding by
adopting the Fair Housing Act. The law set up the New Jersey Council on
Affordable Housing, which asked all 567 municipalities to send in proposals on
how they planned to comply with Mt. Laurel II.
Thus, the Mt. Laurel decision, although it addressed some of the effects of
zoning, was not really f frontal attack on the whole concept. There was no
inclination to allow housing transactions between willing buyers and willing
sellers without municipal interference, as Houston has done. Instead, a
deliberately combersome local process used to resist new housing construction
was replaced with an even more cumbersome state process that might create dome
low-income housing (although it should be remembered that at even at the state
level the poor are a distinct minority).
Progress has been painfully slow. As of 1989, only 161 of the state's 567
municipalities had even submitted plans to conform with the state law. The
housing council does not have any real powers of enforcement, ans the
prospects for widespread cooperation are not encouraging. Overall, about
2,000 new units have been built in 14 communities ince the 1983 decision.
The favored technique for conforming with Mt. Laurel II has been something
called "inclusionary zoning." The process was invented in California and has
since been adopted by many cities and smaller municipalites. It is
particularly popular with jurisdictions that are practicing exclusionary
zoning but don't want to give the impression that they are trying to wall out
the poor.
Under inclusionary zoning, a builder is allowed a density bonus (usually 20
percent more units) in exchange for a promise that the additional units will
be sold at "low-income" prices. The municipality then sets up a selection
process, often including a lottery, whereby a few local applicants get to buy
or rent the new units.
Much to the consternation of housing advocates (and the quiet relief of
suburban officials), these units have not falled into the hands of the urban
poor. Instead, they have attracted what might be called "subsidy hunters" -
young couples, divorced single mothers, the elderly, and other middle-class
people who are knowledgeable enough to take advantage of the system. One town
official called the new residents "junior yuppies, young professionals in
entry-level poitions [who only] qualify by the numbers."
This outcome should not surprise anyone. One problem is that the case upon
which the whole effort is modeled - Mt Laurel itself - was unusual in that
there was already a small community of poor people living in the municipality.
Given the information required to take advantage of Mt. Laurel housing, the
urban poor are not likely to participate.
---
Mt. Laurel is not going to produce the "diaspora of the urban poor" that some
observers anticipated. Nor are the benefits of the Court's decision likely to
filter down to the poor very quickly. In reality, it makes absolutely no
difference whether the few winners of susidized units are "low-income,"
"middle-income," or even "upper-income." Housing is housing, and the only way
to have more of it is to build more of it. The only real benefits of Mt.
Laurel woll come from the density bonuses, which will allow more housing units
to be built.
Yet even this advantage is likely to be limited because the new housing will
not circulate. The new owners, after all, are subsidized and cannot move
without losing their subsidies. They are usually not allowed to sell without
giving up a significant portion of their capital appreciation, either to the
municipality or to the next owner. Thus, they will stay in their units long
after they have cased to suit them and long after the residents have ceased to
be "low-income." By attaching subsidies to housing units, rather than the
people who might live in them, governments effectively take these units off
the market.
The only truly promising feature of Mt. Laurel and the Fair Housing Act is
the provision that if a town does not wish to accept its "fair share" of
housing, it can still meet its quota by paying to have apartments built in
towns willing to accept them. Because this housing will undowbtedly end up in
the hands of deserving people, it will do far more good than housing snapped
up by subsidy hunters.
The great attraction of exclusionary zoning has always been that it is a free
good. A town could zone out whatever housing it didn't want without having to
pay a price. Indeed, it rewarded itself by raising property values and
avoiding social spending. Under Mt. Laurel, towns will finally be held
financially accountable for their exclusionary practices, since they will have
to support housing elsewhere. That, at least, is an accomplishment.
---
William Tucker is the author of _Progress and Privilege_ and _Vigilante_.
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