Infrastructure Short-term vs. Long-term

Infrastructure is a short game and a long game. The short game is cities try to incent developers to come into their city by providing infrastructure in some cases and attempt to have “developer friendly” policies in other cases. The latter appears to be impossible to achieve, because every city is told by developers that they are, “the worst one that we’ve ever developed projects in.” The long game is that once the city allows the developer to come in, build their project, make their money and leave, then the city now owns the infrastructure in perpetuity. Not only do they have to maintain it, but when it wears out, they have to rebuild it. But wait, my taxes cover that or growth in the city covers that or money picked off of the money tree behind city hall covers that, right? Bad news folks, most cities are just playing a shell game with the money. They are robbing Peter (growth) to pay Paul (existing infrastructure). Once Peter isn’t there to rob anymore, Paul is stuck. 

Remember the short and long game? According to a 2009 survey from the International City/County Management Association, City Managers average about 7 years on the job. City council people run for 2, 3 or 4 year elected terms. Elected officials want their name on a plaque or to have their picture taken at a ribbon cutting for a new road. So, then who is worried about the long game when it comes to infrastructure? Many cities have long-range planning departments that have FLUP (future land use plans) and every city in Texas is required to have a comprehensive plan that’s updated every 5 years. Those sorts of things keep cities from running their long-term finances into the ditch, right? Wrong.

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A good portion of comprehensive plans are boilerplate language that the consultants regurgitate from city to city. They change the city logo, do a find and replace from the old city name to the new one, swap out a few maps and voila, here’s your comprehensive plan new city! But wait, my city is unique, we have a __________. (Insert city unique characteristic here.) It may be an airport or trees or rolling hills or location, location, location or a lake or lots of vacant land for developers to pillage. Your unique thing will certainly be highlighted in the comprehensive plan. But, the rest of the plan is going to project increasing population, more traffic counts and more tax revenue, so you are going to need more 6 lane divided roadways, water tanks and subdivisions. But, you won’t be able to afford them all now, so you’ll put them on your Capital Improvements Plan, do a bond election as soon as the city has bonding capacity, or you hope/pray that TxDOT, the Feds, NTTA or other organization with money will come and sprinkle projects around your city. Very few cities honestly assess what adding roads and houses to the city will do financially over the long term.

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The vast majority of houses are money losers for cities. A house doesn’t pay for the infrastructure in front of it until it is in the $300-350K range. The answer is always we need the 30/70 or 40/60 split of commercial/residential to make it pencil out. Comprehensive plans always have a market analysis that very confidently states what sort of businesses your city can attract. But, I have yet to see one that shows the finances of the comprehensive plan. It seems like we’re getting the Wizard of Oz quote, “Pay no attention to that man behind the curtain.” We are just supposed to keep looking forward at the new, bright shiny things that are coming. The cool maps in the comp plan show colors and circles and roadway plans. It doesn’t show you that the single family development area depicted in an attractive, yellow color costs the city a $1M whereas the commercial area makes $250K. If those sorts of metrics were included, then we could tell if the decisions that our city councils and staff make are good ideas when developers come in and ask for changes in zoning. Right now, rarely does anyone ask the long-term consequences of our short term decisions. Developers are damn well going to make their money. Who is making sure the city makes its money? I would argue no one.

Let’s go back to where I started with my very first blog post. Why should I care about local elections? My answer is that local officials are the ones who impact where you live, work, play, and pray every day ten or a hundred or a thousand times more than Washington DC does. Yourcity council may be giving away long-term stability in your city for the short term high that they get from bad growth in your city. If you aren’t sure, ask them. If they give you a blank look or start with a really long-winded answer, then it is time to be concerned.

~ Bill