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Local voters in the Nov. 2 California election were not necessarily "pro-growth" or "anti-growth" but rather seem to have embraced smart growth like never before. They expressed subtle but clear preferences for preserving open space while accepting compact development. Urban growth boundaries were a big hit, and several infill plans and projects were approved while anything that would have led to encroachment on greenfields or urban fringes was shot down. Local election highlights include the following: Smart Growth: Berkeley Smart growth scored a major victory in Berkeley, where the city's historic "no growth" attitude has eased. The approval of Measure R means that the city's downtown core can grow a little more dense and can rise a little higher, with the addition of up to three high-rises that would exceed the city's extant height limits.  The vote embraces what may be a new vision for California cities and, in particular, a new vision of environmentalism. Groups including the Sierra Club supported the measure because it promotes transit-oriented density and a focus on the urban core. Opponents were concerned that it would ruin the city's character and was pandering to developers.  Sustainability: Irvine In a spirit similar to that of the Berkeley vote, voters in historically auto-oriented Irvine approved a new environmental ethos for the city with the ratification of the Irvine Sustainable Community Initiative, which sets environmental goals for both the city and the beleaguered, delayed Great Park. The initiative calls for the city to promote green building, renewable energy, and alternative modes of transportation. The initiative complements the vision for density set out by the recently approved Irvine Business Complex plan (see CP&DR Vol. 25, No. 15, August 2010 ).  Projects & Plans: Menlo Park, Redondo Beach, San Diego, Saratoga In large part, local voters supported specific developments and development schemes. Voters in Menlo Park approved an enormous mixed-use development while voters in Redondo Beach approved a new vision and zoning scheme for the city's harbor area and waterfront. In San Diego, the Pacific Highlands Ranch development will be allowed to develop neighborhood amenities such as libraries and schools even in the absence of a planned highway. Meanwhile, a measure that would have limited building heights to two stories in Saratoga failed by a margin of less than 1%.  Urban Growth Boundaries: Cloverdale, San Ramon, Petaluma, & Santa Rosa Formerly the only city in Napa County without a UGB, Cloverdale embraced the trend and voted in its first UGB. Cloverdale is not known for growth pressures but the UGB may be a formal statement in favor of slow growth. Voters in San Ramon rejected a measure that would have expanded its existing UGB, and voters in Petaluma and Santa Rosa voted to extend the lifespan of their UGBs. UGBs are sometimes considered tools to promote higher-density growth within defined urban areas. However, by virtue of their rural locations, all at least three of the four UGB measures that appeared on local ballots appear to be intended to prevent greenfield development rather than promote urban infill.  Rancho Palos Verdes: College Expansion Perhaps the most contentious local battle the state centered on what was probably the smallest project. Marymount College in upscale, largely residential Rancho Palos Verdes appealed to voters in its quest to build a new dormitory and make other campus improvements. But even as the college spent over $1 million to curry favor with residents, the city's vehement no-growth coalition roused voter sentiment against the college and defeated the measure.  Sutter County: Food Processing, Agricultural, Recreation Combining District A more ambiguous situation in Sutter County led to an anti-growth vote. The county has been saddled with what many consider a white elephant of a parcel for the better part of three decades in the 1,800-acre Food Processing, Agricultural, Recreation Combining District – which for the better part of two decades has done none of the above. Measure V was supposed to give control of the parcel to the Board of Supervisors so that they would have the power to re-zone and redevelop the parcel to a higher and better use than its current vacancy. Sixty-eight percent of voters, however, were not willing to give them that sort of control; opponents feared that the board would eventually approve the development of homes on the parcel, so for now the site remains moribund. Statewide Measures Prop 19: Marijuana And for everyone who wanted a little piece of Amsterdam at his or her corner coffee shop or that 5 x 5-foot plot of green in their backyard (See CP&DR Vol. 25, No. 12, June 2010 )? Take a drag and mellow out because 2012 is only two years away. This means that local governments are off the hook. Prop. 19 would have essentially forced every locality in the state to come up with its own marijuana policy. Many would likely have banned pot outright, but others were wrestling with how and where to permit large-scale cultivation and use. Prop. 21: State Parks While Californians supported climate change legislation, local environments suffered a blow with the defeat of Prop. 21, which would have secured desperately needed funding for the State Parks system via an annual $18 vehicle registration fee. It's unlikely that anyone takes pleasure in the disrepair of California's parks. However, even with the parks' economic value – and even with the sly juxtaposition of vehicles and nature – voters in these fragile economic times simply did not want a new fee and rejected it by a 60-40 margin. Prop. 22: Local Transportation, Redevelopment Funding Local governments scored a dearly sought-after victory with the approval of Prop. 22, which secures local redevelopment and transportation funds against state borrowing or raiding. Groups such as the California Redevelopment Association and almost every transportation authority across the state lobbied vigorously for the passage of Prop. 22, lest this past year's $2.05 billion transfer of local redevelopment funds to the state become de rigueur (see CP&DR Vol. 25, No. 9, May 2010 ). This may be bad news if you're trying to balance a budget in Sacramento, but voters seem to have gravitated towards its spirit of local control and relatively unambiguous allocation of funds.  Prop. 23: Jobs & Climate Change Likewise, with a chorus of planners and environmentalists speaking out against oil companies and others who promoted Prop. 23, Californians affirmed their desire to combat climate change. Whether AB 32, the Global Warming Solutions Act, will create the green jobs that then-Assemblymember Fran Pavely envisioned four years ago or undermine existing remains to be seen. The salvation of AB 32 also erases any concerns about the fate of SB 375. Although SB 375 was written to stand on its own, many have speculated that the defeat of AB 32 would undermine localities' efforts to promote compact development in accordance with SB 375. Prop. 26: Taxes & Fees Finally, Prop. 26, whose supporters sought to close a tax policy "loophole" that allowed localities to impose taxes under the guise of fees, gained approval by tapping into the same anti-tax sentiment that felled Prop. 21. Prop. 26  (see CP&DR Blog Nov. 4, 2010 ) now limits cities' and local agencies' ability to both raise revenue and achieve policy goals by assessing fees that only required a simple legislative majority. Instead, Prop. 26 reclassifies these fees as taxes and thus requires a 2/3 supermajority approval of local voters. Prop. 26 does exempt development impact fees, but is targeted at more generalized fees – possibly fees for general plans – that do not explicitly tie the fee to an actual impact.

What the government builds and where it builds things can have a major impact on a community and on the way generations of people live their lives. The siting of college campuses in California provides a poignant, and depressing, case study.  This obvious truth was reinforced to me by two recent events: Shasta County's annual count of bicyclists and pedestrians in Redding, and the recent completion of a multi-use trail connecting two sides of Redding that are otherwise divided by a river and a freeway. The bike count is a snapshot, not a comprehensive census. And the picture at Redding's Shasta College is nearly devoid of both cyclists and pedestrians. From 7 to 8:30 a.m. and again from 4 to 6 p.m. on a school day in September, 19 cyclists and 8 pedestrians crossed the intersection in front of the community college's primary entrance. Those are about the numbers you would expect to get with one change of the signal at an entrance to UC Davis, Chico State or Pasadena City College. I concede that Shasta College is not as large as those institutions -- but one pedestrian every 26 minutes?! If anyone is going to use their feet or bicycle for transportation, it's college students. The problem is that Shasta College, like most other community college, CSU and UC campuses built during the post-war period, lies on the edge of town in a location accessible almost exclusively by automobile. California's campus construction binge of the late 1940s through the 1960s was ambitious, but overwhelmingly suburban. The assumption was that everyone would drive to and from school. Many universities from that era are still called "commuter schools." Even my alma mater, CSU Sacramento, which is located in the middle of the metropolis, feels remote because the campus is essentially walled off from the rest of town. Sure, most of the post-war campuses enjoy decent bus service, and my old school does boast a heavily used bicycle and pedestrian bridge across the American River. Still, it's worth remembering that the CSU Sacramento administration vigorously – and successfully – fought a proposal to place a light rail station on the college campus because of alleged safety concerns. Sorry kid, I know you don't have any money and are racking up debt faster than empty beer cans, but you'll have to buy a car.  Moreover, the post-war college siting and design decisions relegated a thriving center of activity to a corner of town at the expense of the rest of the community. College kids may not be flush with money, but they are loaded with energy. That's why real college towns such as Davis, Chico and Berkeley pulse with activity. I'm not suggesting that every place needs to be a college town. But many places that are suited for street life become all the more lively with the injection of a few thousand students. Thirty years after the campus construction boom, we hadn't learned much, as evidenced by the CSU Sacramento light rail fiasco. Another example is UC Merced, which the state chose to build on pastures several miles outside of town 15 years ago. Yes, the plan for eventual development of a university community adjacent to the campus is impressive. Yet it's only more greenfield development in a region where cities are starved for investment, and the school will probably be open for 20 or 30 years before the urban village amounts to much. If we had learned anything, UC Merced would instead be UC Modesto or UC Fresno, and the school would be located in one of those cities' downtowns. CSU Channel Islands may be worse. The campus makes good use of the old state mental hospital outside Camarillo, but the planned university village is modest. It's an isolated campus surrounded by farmland and protected open space – bucolic, but an urban planning disaster. Officials at CSU originally proposed building the school adjacent to Ventura's poorest neighborhood; however, CSU gave up in the face of strenuous no-growth opposition. Sorry, but Ventura as a whole and tens of thousands of students, teachers and CSUCI workers would be better off if CSU had jammed the project down the throat of local naysayers. Instead, that part of Ventura continues to struggle, and everyone has to drive to a remote campus. With an ongoing state budget deficit and an aging populace, California is unlikely to build many new college campuses in the foreseeable future. We do continue to build transportation facilities, though, and here's where I have an example of a government project's positive contribution to community livability. In October, Caltrans completed a major upgrade to Highway 44 in Redding. The agency built a new bridge over the Sacramento River, widening the highway from four lanes to six. It rebuilt an intersection, modified a few ramps and built a new onramp. It also constructed a 1.1-mile-long, 12-foot-wide multi-use path along the highway. The path takes people from an existing bike path next to the convention center and the city's biggest museum to the retail center of town. Most importantly, it provides a safe route over the river and under the freeway, both of which pose barriers to cyclists and pedestrians in Redding. People have filled the path since the moment it opened. Much of the use is recreational, but I've also seen cyclists who are obviously commuting, as well as people carrying sacks of groceries. Caltrans recognized the latent demand. If California is truly going to shift to a more sustainable style of development, it needs to review its mistakes (poorly situated college campuses) and its successes (non-motorized paths that provide connectivity), and then build public facilities accordingly. Maybe we could start by hiring some progressive young planners that our public universities are graduating.  – Paul Shigley

A city ordinance effectively banning tattoo parlors oversteps constitutional limits protecting freedom of expression, the Ninth U.S. Circuit Court of Appeals has ruled. A unanimous three-judge panel struck down a City of Hermosa Beach zoning code prohibiting tattoo parlors because it violated the First Amendment.  Although it may seem that tattoos are the provenance of modern day subcultures such as rock stars and motorcyclists, tattoos have been part of evolving culture around the globe for thousands of years, the court explained. City of Hermosa Beach, however, perceived tattoos' outlaw air and had adopted a zoning ordinance that precluded the operation of tattoo parlors. Johnny Anderson, a tattooist operating in the City of Los Angeles, wanted to open a parlor in this neighboring beach city and ran headlong into the prohibition. In 2006, he sued Hermosa Beach, but the action was dismissed because Anderson had not availed himself of city administrative procedures for determining whether a tattoo parlor might be allowed as similar to other permitted uses. Following case dismissal, Anderson filed a request with the city for such a determination. The city denied Anderson's request in June 2007. He then filed a 42 USC § 1983 civil rights claim, alleging violation of the First and Fourteenth Amendments. At the District Court level, the city successfully argued that tattooing was not a First Amendment protected activity. District Court Judge Christina Snyder reviewed the ordinance under the rational basis test, and, on the basis of potential health risks, upheld the ban. Anderson appealed. The Ninth Circuit reversed the lower court, finding, "The tattoo itself, the process of tattooing, and even the business of tattooing are … purely expressive activities fully protected by the First Amendment." Accordingly, the scope of city regulation must be limited to reasonable "time, place and manner," the court determined. The court then addressed and rejected each of the city's arguments that the ban amounted to reasonable time, place and manner restrictions. Perhaps the city's best argument was based upon public health. Tattooing involves the injection of ink into a person's skin. The required puncturing of the skin creates the potential for skin infection. State law requires every tattooist to register with county health departments. The Los Angeles County health department had one inspector, and not all establishments operating within the jurisdiction of the county had been inspected. The city asserted that the county's limited resources with which to inspect and regulate tattoo parlors for public health purposes was sufficient justification for an absolute ban.  The court held, however, that the city failed to provide sufficient justification that it could not otherwise accommodate public health concerns while permitting a First Amendment protected activity. In other words, the ordinance was too broad. " lthough a total ban on tattooing might be the most convenient way of addressing the city's health concerns, the city has given us no reason to conclude that these concerns cannot be adequately addressed through regulation of tattooing rather than a total ban on tattoo parlors," Judge Jay Bybee wrote for the court. "Thus, particularly in light of the Supreme Court's historical ‘concern with laws that foreclose an entire medium of expression,' we have little difficulty concluding that the city's ban is ‘substantially broader than necessary to achieve the interest.' The city also argued that there were alternative means of communicating the same protected speech, such as printing on a tee shirt. The court concluded, however, that the permanent nature of tattoo ink carried a different message, and that there were no other equally effective communication media. The Case: Anderson v. City of Hermosa Beach , No. 08-56914, 2010 DJDAR 14319. Filed September 9, 2010. The Lawyers: For Anderson: Robert C. Moest, (310) 915-6628 For the city: John C. Cotti, Jenkins & Hogin, (310) 643-8448

Divine purposes do not give developers a free pass to circumvent local zoning regulations.  The Second District Court of Appeal has ruled that Los Angeles County was entitled to a court order that prohibited a church from operating a school without a required conditional user permit. The Sahag-Mesrob Armenian Church owns two parcels zoned R-1 (single-family residential) in the San Gabriel Valley. In May 2008, the church filed an application for a conditional use permit to operate an 800-student, K-12 school on the property. Four months later, the county received complaints that the school was operating in advance of the issuance of the conditional use permit and without California Environmental Quality Act review. The county conducted an inspection, verified that the school was operating, and issued a notice of violation giving the school 15 days to cease operation. Within this 15-day period, the church applied for a "clean hands waiver" from the county, which would allow the school to remain open during the pendency of the use permit review and processing. The county denied the waiver request. The county then issued a final code enforcement order directing that the school cease operating within 15 days. The church appealed this order, but the county denied the appeal. Following subsequent verification in late 2008 that the school was still operating, the county filed a code enforcement action and sought a preliminary injunction to close the school. Los Angeles County Superior Court Judge Jan Pluim granted the preliminary injunction, prohibiting the school from using the property until all necessary permits were in place. Sahag-Mesrob Armenian Christian School appealed. The appellate decision addressed the interface of local zoning regulation with the federal Religious Land Use and Institutionalized Persons Act (RLUIPA) (42 U.S.C. § 2000cc(a)-(b).) The first issue for the court was whether the county's requirement for a conditional use permit and the denial of the clean hands waiver violated RLUIPA's "substantial burden" test. Reviewing a number of decisions from other states, the unanimous, three-judge appellate panel concluded that the necessity for a conditional use permit and the denial of the clean hands waiver did not coerce or affect an individual's practice of faith and, therefore, was not an unreasonable burden. "No Supreme Court case holds the failure to comply with a neutral zoning application process is a substantial burden on the exercise of religious freedoms," Presiding Justice Paul Turner wrote for the court.  The church argued that the county's denial of the clean hands waiver was improper because the county had granted 50 waiver requests from faith-based and non-faith-based entities. (The county had also denied 23 such requests.) The county successfully argued that it had a sufficient factual basis upon which it could justify approving waivers for other applicants but denying this particular request. For one thing, the granted waivers were for activities in locations which would not have the same level of adverse impacts to surrounding uses as would the school. For another, the county had denied a waiver to a different church next to a residential neighborhood because of traffic and parking concerns.  "Thus, the clean hands waiver application in this case could be denied without violating the act. There is no evidence any other entity seeking to use the property would be treated any differently," Turner wrote.  A civil rights lawsuit filed by the church against the county remains pending in federal court.  The Case: County of Los Angeles v. Sahag-Mesrob Armenian Christian School, No. B216888, 188 Cal.App.4th 851, 2010 DJDAR 14846. Filed September 22, 2010 The Lawyers: For Sahag-Mesrob Armenian Christian School: Richard J. Kahdeman, Kahdeman & Nickel, (818) 597-9996 For the county: Dusan Pavlovic, county counsel's office, (213) 974-1900 --William W. Abbott

If I ever write a book about the crisis of the world's largest cities, this photograph from the Oct. 24 edition of the LA Times should be on the cover: A 27-story, 400,000-square-foot private home (!) built by a Mumbai billionaire Mukesh Ambani, reportedly the world's fourth-richest individual.  According to the Times story, Mr. Ambani's residence has both helipads and 168 parking spaces for a family of six. The home has prime views of both the ocean—and surrounding slums. No image could better distill the extremes of the modern mega-city than this bizarre building—looking like a Dagwood sandwich held together with enormous, diagonal toothpicks. To my mind, this single image hints at all the issues pressing down on the world‘s mega-cities (think Beijing, Jakarta, Sao Paulo). Start with overpopulation and uncontrolled urbanism. Add to that extreme contrasts of wealth and poverty. With the extreme gap in income, the rich feel increasingly vulnerable, and house themselves in bunkers that dramatize social polarization. Then add to that an inflated real estate market and construction without regard for environment (how many tons of greenhouse gases were pumped into the atmosphere from the trucks bringing materials to and from the site of Mr. Ambani's personal residence?). Add to that the "conspicuous consumption" of sheer volume; old-fashioned pashas went in for visual richness and ornament; today‘s fatcat just wants your jaw to drop with the sheer amplitude of private Cartesian space. As for open space and pedestrian friendly streets… fuhgeddaboutit! They're too expensive, and there's no return on the rupee. The slums, ironically, are the reverse mirror image of the Ambani residence: Granted, this has been said many times before, but the form of the modern city reflects labor economics of an industrial society—i.e. a perpetual oversupply of cheap labor, which must be fed and housed as cheaply as possibly, so that people can live on low wages. Hey, the view of these shacks is great from the top floor, from which they appear almost … picturesque (if you ignore the raw sewage running down the street, that is). None of these phenomena are new or surprising: What is remarkable here is the suddenness and the extremity that boom economies have brought to the world's densest cities. But can the exploding cities of the global economy be made into habitable places? What set of incentives must be in place to make cities habitable in the most basic ways? And is there a tension between private enterprise and the effort to "green" the world's most populous cities? In any event, the apologists for the global economy should look at this 27-story home and ask whether superwealth is translating into a better life for people as a whole, or driving an even deeper wedge between rich and poor. --Morris Newman

Refusing to second-guess a decision made by a public agency based on substantial evidence, the First District Court of Appeal has upheld a Sonoma County urban water management plan. The case resembled a great deal of land use and California Environmental Quality Act (CEQA) cases in which a plan or project opponent asks the court to scrutinize agency decision-makers by reweighing the evidence, and/or to expansively interpret the duties imposed by a particular statute. In  Sonoma County Water Coalition v. Sonoma County Water Agency , a unanimous three-judge panel of the First District, Division Five, declined to take either approach. The case involved the urban water management plan (UWMP) adopted by the Sonoma County Water Agency (SCWA). The agency is a water wholesaler whose service area covers portions of Sonoma and Marin counties and includes a population of approximately 600,000. Under state law, water providers must prepare or update an UWMP every five years and address the supply of water over the following 20 years. The agency adopted the plan in 2006, and was sued by 14 environmental and agricultural organizations led the Sonoma County Water Coalition. The opponents sued on five general grounds: (1) lack of coordination with required agencies, (2) lack of the required detail within the plan, (3) failure to consider certain environmental factors, (4) failure to address the effect of recycled water on the future water supply and (5) failure to provide reasonable specificity with respect to water demand measures identified to address potential future water shortfalls. Sonoma County Superior Court Judge Gary Nadler ruled favorably for the UWMP opponents. SCWA appealed, and the First District court reversed the lower court, in large part by concluding that Judge Nadler had failed to apply the required level of deference to the agency's decision. A number of the opponents' challenges were constructed around the "possibility" argument. That is, the legal challenge was formulated by assaulting the decision on the possibility that one or more assumptions may not come to bear. For example, the challenged water management plan made certain key assumptions about future approval by the State Water Resources Control Board of additional diversions from the Russian River. The environmental and agricultural groups successfully argued to the trial court that, because this approval was not assured, the possibility existed that the future diversions might be denied. This type argument is frequently raised in land use or CEQA challenges because the contested project involves other agencies with independent regulatory control that influences future project implementation. Here, the appellate court determined that the trial court erred in setting aside SCWA's decision, because there was substantial evidence in the record to support the agency's decision with respect to the future diversion and other future regulatory issues controlled by other agencies. In other words, an agency may rely upon a reasonable set of assumptions if the assumptions are supported by substantial evidence. The appellate court also rejected as a matter of statutory interpretation that the law required the adopting agency to develop the UWMP predicated on a "bare possibility." In recognizing the deference owed to the adopting agency, the appellate court noted that the issue was not whether another planning assumption was more reasonable, but whether there was substantial evidence to support the assumption adopted by SCWA. While the appellate decision does not explain the scope of the administrative record, from a practitioner's perspective it is clear that SCWA did its homework by providing supporting evidence for its key assumptions. Another example of the possibility claim was the opponents' argument that there existed the potential for future groundwater contamination as a result of potential wastewater discharges by the City of Santa Rosa. This possibility was raised after the City of Santa Rosa circulated a request for CEQA scoping for a proposed wastewater project in the Russian River watershed. According to UWMP opponents, this wastewater discharge proposal rendered the UWMP invalid because it failed to account for the risk that wastewater discharges could contaminate the drinking water supply. The appellate court noted that the record before SCWA did not support the conclusion that this risk existed. No specific discharge project had been defined and the project was speculative. Perhaps more importantly, the record contained evidence supporting SCWA's conclusion that its water treatment and natural filtration systems would reasonably assure adequate water quality. "Although others might well assess the significance of the risk presented by DCP differently, it was again error for the court to substitute its judgment for that of the agency," Justice Terence Bruiniers wrote for the appellate court. With respect to the coordination claim, the environmental and agricultural groups argued that SCWA was required to coordinate not only with all agencies that shared the same supply, but also with all agencies whose regulatory authority potentially impacted future supplies, such as the Army Corps of Engineers and Federal Energy Regulatory Commission. The appellate court concluded that none of the agencies identified by the opponents meet the statutory criteria of agencies "in the area" that shared the same water source or otherwise qualified as water management agencies. The fact that these other agencies' regulatory authority might impact future water supply did not bring them within the scope of the statute for purposes of coordination, the court ruled. The appellate court applied an abuse of discretion standard in reviewing the agency's decision not to coordinate with these other agencies. This decision restates and highlights the role of substantial evidence in guiding a court as it reviews challenged agency actions. The court refused to sit in place of agency decision-makers, but, instead, reviewed challenged decisions while recognizing the expertise of the decision-makers and applying the statute as drafted. Although this case involved an urban water management plan, the decision should act as important guidance in the CEQA and land use context as well. The Case: Sonoma County Water Coalition v. Sonoma County Water Agency , No. 124556, 2010 DJDAR 15743. Filed October 8, 2010. The Lawyers: For Sonoma County Water Coalition: Stephan C. Volker, (510) 496-0600. For Sonoma County Water Agency: Stephen L. Kostka, Bingham McCutchen, (415) 393-2000.

So, yet again Wendell Cox � a leader of the anti-anti-sprawl crowd -- has trotted out an impressive-looking quantitative report that purports to prove that certain metropolitan regions have high home prices because of "more restrictive land use regulation". In his New Geography piece  last week , which linked to a report on his web site , Cox seemed to attribute virtually all the variation in home price around the country to land use regulations � just as he has done in the past. But � as usual � Cox's analysis is based on the assumption that sprawl is the natural state of affairs and any deviation from sprawl must therefore be caused by regulation. He does extensive quantitative analysis to prove that all difference in home price  is due to regulation. But it's not too surprising that he reaches that conclusion, considering that his analysis assumes that any difference must be due to regulation. And even Cox himself apparently recognizes that he can't quite make an airtight connection. As he said in the New Geography piece: "Nearly all of this difference is in costs other than site preparation and construction, which indicates rising land and regulation costs." Note the language: Indicates, not proves. And that's not the only defect in his methodology. There are lots more assumptions piled on top of assumptions � some contradictory -- that make the numbers come out the way he wants them to. To summarize Cox's latest analysis, he compared home prices in 11 metropolitan areas. Home prices in six metropolitan areas that he categorizes as having "less restrictive land use regulation" (Atlanta, Dallas, Houston, Indianapolis, Raleigh-Durham, and St. Louis) are lower than home prices in five metros he characterizes as having "more restrictive land use regulation" (Minneapolis-St. Paul, Portland, San Diego, Seattle, and Washington, D.C.-Baltimore). Not too surprising on the face of it, but let's unpack Cox's methodology, most of which is contained in a separate document . First, he asserts that more restrictive regulation raises home prices and disrupts normal market functioning in a variety of ways. There's obviously a lot of truth in that. Second, he identifies six specific regulatory approaches that, he claims, are characteristic of "more restrictive land use regulation policies with potential to increase land costs and house prices". These are: 1. Urban containment (urban growth boundaries, urban service districts, restrictions on physically developable land, infill quotas.) 2. Large-lot zoning in urban fringe & rural areas. 3. Geographical growth steering 4. Housing building moratoria or limits 5. High development fees & exactions 6. Mandatory regional or county planning. Where did he get this list? Well, in some cases he got them from the 2000 HUD report The Cost of Sprawl. In other cases he references himself, a la Mike Davis. But he doesn't differentiate among these policies; he simply asserts that they all fall into the category of restrictive regulation. Never mind, for example, that he lumps together UGBs (which encourage higher density) and large-lot zoning (which encourage lower density). He also asserts that no matter what the policies are called � for example, smart growth or growth management -- they are basically all the same. Next he categorizes the 11 metros based on the presence or absence of these six criteria. In the case of the five "more restrictive" metros, he finds the presence between two and four of the criteria. He's on target in many cases � clearly, Portland has a UGB. But he gives them equal weight, even though his discussion of the six admits that not all of them have the same effect. And, amusingly, he finds that none of these criteria are present in any of the six "less restrictive" metros. Apparently there's large-lot zoning in Minneapolis but not in Atlanta or Raleigh or St. Louis? He gives no indication as to how he decided this. Once he comes up with these categories, he then goes through an exhaustive � and, frankly, mostly well-executed � quantitative analysis about home construction cost, accounting for variation in construction costs in each metropolitan area. But then he assumes that construction cost is typically 80% of the advertised home price, meaning 20% is attributable to land cost and regulation. He says he has data to prove this but doesn't provide references; he simply assumes that 20% is what land and regulation cost should be in a less restrictively regulated market. And then he simply assumes that if the difference between home price and construction cost is more than 20%, then  all the difference must be due to regulation. For example, if construction cost is $80,000, the sales price of the house should be $100,000. Under Cox's methodology, if the cost of the house is more than $100,000, anything over that price is either due to excess regulation or due to high land cost that is caused by excess regulation. In his 11 metros, he compares the "expected finished land and regulation cost" with the actual difference between construction cost and home price. This is, miraculously, zero in his six "less restrictive" metros, and it's a lot more in the other metros � ranging from $28,000 per unit in Minneapolis to $221,000 in San Diego. To give a more detailed comparison, Cox calculates that construction cost of the average home in Atlanta and Washington-Baltimore is about the same -- $128,000. Based on his 80/20 rule, this means the average home price in each metro should be about $160,000 (with $32,000 for land and regulatory cost). The average home price in metro Atlanta is $161,000 � right on target. But the average home price in metro Washington/Baltimore is $235,000. That's $75,000 more than he thinks it should be � so obviously all of the increase MUST be due to regulation! The list of other things that could account for this difference is long indeed, but Cox doesn't even give lip service to any of them. To begin with, there's demand � and, in particular, the psychology of any given real estate market. Real estate booms and busts are common, as we saw have learned once again here in California in the last few years. Then there's the income of the people buying the houses; that's a factor because, in practical terms, home prices depend not only on how much houses cost to build but also on how much you can afford to pay. The more you can afford to pay, the higher the prices will be. (Median incomes in Washington-Baltimore are about 10% higher than median incomes in Atlanta And where's developer profit, which will rise in a boom market and drop in a bust market? Cox's formula doesn't seem to acknowledge profit at all. Poor guys. I could go on, but you get the idea. I respect the anti-anti-sprawl researchers � Cox, Randall O'Toole, Sam Staley � and I try to stay on good terms with them. But what drives me crazy about this stuff is that the self-fulfilling assumptions undermine the valid points and make it difficult to reach consensus about what's going on. There's no question, for example, that UGBs do increase home prices at least a little and also create a "bounce" effect, as my colleague Rolf Pendall and I have acknowledged in a piece of research Cox cites as part of his source material. But UGBs do not, by any means, account for all home price variation. Instead of acknowledging the complexity of the situation, however, Cox lumps all public policy into the same category of intrusive regulation and then ascribes all variation in home price to that regulation. (O'Toole does the same thing all the time.) I'm no academic snob, but I can't believe this would pass any serious peer-review muster. Unfortunately, Cox's stuff is the Fox News � or MSNBC, if you prefer � of land use research. One point of view always wins out. The possibility that another point of view may have merit is simply never entertained. Instead of moving toward greater understanding about land use policy and how to use it, we are pushed deeper into our own separate world views � and further away from a useful policy debate. -- Bill Fulton Bill Fulton's new book on economic development, Romancing The Smokestack , is available here .

The passage of Proposition 26 – which requires two-thirds voter approval for certain local fees – won't stop the gears of land use planning and development approvals from churning. However, it does turn traditional thinking on its head – a fee is a tax unless proven otherwise – and it's certain to lead to some litigation that might affect planning and development on the margins in California. At least that was the conclusion Wednesday of League of California Cities lobbyist Bill Higgins, who spoke at the California Chapter, American Planning Association, conference at La Costa Resort in Carlsbad. Philosophically, Proposition 26 represents a huge change in the way California views fees and taxes. There's now a new definition of taxes: "Any  levy,  charge  or  exaction  of  any  kind" imposed by the government, unless the fee falls within an exemption under the law. But the practical effect on planning may not be great. Although television commercials made it seem as though all fees will be affected, in fact Proposition 26 has a very narrow target: Sinclair Paint Co. v. Board of Equalization , a 1997 court ruling that upheld regulatory fees on manufacturers of lead paint to pay for programs to assist children subject to lead poisoning. The intent of Proposition 26 is to outlaw fees imposed generally on an industry to pay for the mitigation of problems created by that industry's products, without tying the fees to specific impacts. In a nutshell, Proposition 26 takes the "special benefit" language from assessments and applies them to fees. "Proposition 26 requires proportionality accounting on an individual user basis," Higgins said. In that sense, it's not unlike current rules on development impact fees and other obligations imposed on developers. In fact, development impact fees are exempt from Proposition 26. So are administrative costs associated with running the government – but not, apparently, advanced planning and regulatory rulemaking, which would have to be paid for out of tax funds. To that last point, Higgins said a broader question is whether other, more general fees imposed on developers – for example, a General Plan fee used to stockpile funds to update the General Plan – might get caught in Proposition 26's web. More broadly, a variety of other fees that local governments rely on – though not in the planning and development arena – might be affected. For example, according to prominent municipal lawyer Michael  G.  Colantuono , franchise fees could be at risk. And municipal gas and electric rate increases – which were exempt from Proposition 218 – will now be subject to a two-thirds vote, even though rate increases for private utilities are not. Fees and rates covered by Proposition 218 are exempt from Proposition 26.

Here's the factoid of the week at the California Chapter, American Planning Association, conference: Out of all the local sales tax declines since 2005, 40 percent are due to declining auto sales. That's right: Local sales tax revenue in California has dropped $600 million in the last five years. And of that amount, about $245 million came from declining auto sales. This according to economic analyst Stan Hoffman, who also reported that about 10% of all dealerships have gone out of business and somewhere between 500 and 1,000 acres of prime urban real estate have opened up as a result. Cities have depended on sales tax from auto sales for huge revenues in the last 20 years – but the auto industry is changing and it's hard to know how this is going to affect California cities in the long run. The bottom line, according to several panelists who spoke to this topic at the CCAPA event on Tuesday, is that cities will never get all this tax revenue back. They can possibly prop up auto sales by opening up auto malls and auto strips to used-car dealerships, but in the long run most of the land – especially along the old commercial strips – will turn over to other uses. The starkest tale told on Tuesday came from Whittier, which has had a strong group of auto dealers along Whittier Boulevard for generations. Here's what's changed since 2006: * 7 of the city's 9 dealers have closed. * Sales tax from auto sales has dropped from $1.8 million to $490,000 per year. * Sales tax from auto sales has dropped from 24% of the city's sales tax to 9%. Assistant City Manager Jeff Collier said Whittier has changed its Whittier Boulevard Specific Plan to permit used-car sales – at least temporarily – and is planning for intense commercial, housing, and mixed-use nodes along the boulevard. But he described a lot of problems, including fragmented ownership, contamination cleanup from service areas (one cleanup clost almost $1 million), and a lack of demand. Collier's takeaways: * Don't accept the first new use that comes along no matter what it is. * Understand the market so that you focus on development that's feasible, not aspirational. * Don't expect all the tax revenue to be replaced and look for other revenue options elsewhere. As the saga of declining auto sales and the impact on cities unfolds, a few wrinkles are becoming obvious. These include the following: * Commercial boulevards are struggling more than freeway-close auto centers. The Tuesday panel told the tale not only of Whittier Boulevard but also Colorado Boulevard in Pasadena, which has similarly struggled. * Microclimates matter. High-end dealerships in Pasadena have struggled – Maserati recently shut down – but as my blog from a couple of weeks ago indicated , luxury car sales along the boulevards on the Westside of L.A. are still really strong and dealerships are expanding. * Especially along the boulevards, there are a lot of familiar landowner problems. In some cases, longtime property owners have such low costs that they're not motivated to redevelopment. In other cases, the auto brands are still paying on the lease even though the dealership has left – good for the landowner, bad for the city. And in some cases, complicated landowner circumstances make it more difficult to make anything happen. (Eric Duyshart of Pasadena told the story of one dealership where adjacent parcels were owned by the dealer's two ex-wives!) -- Bill Fulton

Of all the ways that California is attempting to reduce its carbon footprint, perhaps none will have a more dramatic, or immediate, impact than that of solar power.   Up to 200 solar energy projects, are seeking, or have received, approval to be developed in California. Most notable of these are nine large-scale projects in the state's own Empty Quarter � the Mojave and Colorado  -- where state and federal officials are on the verge of inking approvals on more than 4,100 megawatts worth of solar thermal farms. Collectively, they represent nearly ten times the amount of solar capacity installed in 2009, and enough energy to power roughly 2 million homes.  One recently approved project, the Blythe Solar Power Project by the Millennium Solar, will eventually produce up to 1,000 megawatts a day, making it the largest solar power plant in the world. Companies like Millennium boast that jobs these projects will eventually create are good news for the state's nascent "green economy." And, perhaps more importantly, they are expected to provide heaps of clean energy that can help the state curb its greenhouse gas emissions and meet the goals of laws such as AB 32.  The 21st century equivalent of oil fields, these plants will not pierce deep into the Earth's surface. However, many environmentalists still approach them with suspicion.  "It is absolutely crucial that we get moved on to a renewable-based energy economy as soon as possible," said Chris Clarke, co-founder of Solar Done Right, a coalition of activists and experts concerned about the pace of industrial solar power development. "The problem is that�these giant remote utility-scale solar projects�are not spending our fairly limited economic and technological resources in a way that is going to sufficiently reduce our carbon burden on the planet." The projects' operational sizes range from a few hundred acres to more than 7,000 acres, and their total rights of way are more than 34,000 acres � roughly 53 square miles. These projects represent huge footprints that inevitably impact the local environment and its plant and animal species. But despite concerns, all nine projects appear to be moving towards approval by the end of the year. Six have already been licensed by the California Energy Commission, and three others are expected to face votes by the end of the year.  Clarke's group contends that companies like Millennium are building the desert mainly because they see profits in long-distance transmission. Clarke advocates local, small-scale solar generation like rooftop collectors.  This unusually fast pace of project review and approval was spurred by a grant program for renewable energy projects included in the American Recovery and Reinvestment Act of 2009 � a program with a deadline of December 31, 2010. Generous by any standards, the ARRA grants cover up to 30% of a project's cost, which is a major incentive for the private developers behind these multi-billion-dollar projects. The California Energy Commission estimates that the grants could total up to $2.8 billion if all of this year's applicants are approved and get built. But it's not just a sweet deal for developers that's pushing this sense of urgency. The State of California is also trying to meet its own set of deadlines. Public utilities in the state are, by the end of this year, supposed to derive at least 20% of their energy portfolios from renewable sources. Most are not expected to meet that requirement in part because of lack of generating capacity, but the state hopes that these solar projects will help utilities meet those targets relatively soon. To usher these projects along, the Department of the Interior and its Bureau of Land Management have teamed up with the state to create a fast-track program to process and approve large-scale renewable energy projects. They've targeted projects that were far enough along in their applications and reviews and have been plugging away over the past few months to ink approvals. "Collaboration with the state on that was a very big deal" said Erin Curtis of the Bureau of Land Management's media relations office in California.  The nine projects in the fast-track program are solar thermal projects, those that use vast arras of mirrors to concentrate sunlight to turn gas- or steam-driven turbines. Photovoltaic plants, which convert solar energy directly into electricity, were not included in the program as they only require county approval. However, three additional photovoltaic projects situated on federal land within California are also currently under review by the Bureau of Land Management. The fast-track program has greatly reduced the amount of time it takes to process these applications by performing state and federal environmental reviews at the same time, something Curtis said hardly ever happens. "We made a concerted effort to make sure these processes were in as much alignment with each other as possible," said Curtis. Through the fast-track program, reviews and approvals have been cut down to just 9-11 months. By comparison, the typical application and review period for a project like a natural gas plant is about 18 months. But those projects typically cover only about 30 to 50 acres, and are far less complex than solar plants, which can cover upwards of ten square miles. The greater size means more people are involved in reviewing and approving the project. It can also mean that the projects' impacts on the land can be significant. "The project sites are very large," said Karen Douglas, chair of the California Energy Commission. "The potential biological impact, the potential cultural resources impact, the potential water use impacts are significantly different than what you'd find in a natural gas power plant." And that can mean different in a worse way. Despite clearing CEQA and NEPA environmental impact reviews, some impacts remain too much for environmental groups. The Sierra Club, the California Native Plant Society, the Center for Biological Diversity and a number of other groups, including Clarke's Solar Done Right, have spoken out against some of the projects up for review or already approved. "Most of the technologies basically remove all the native vegetation and scrape the area completely clean. And in most cases, little to no wildlife can live in the same site as the project," said Barb Boyle, senior representative for clean energy solutions at the Sierra Club. Joining seven other environmental groups, the Sierra Club has been protesting one of the plants that was just approved by the California Energy Commission in September and then by the Bureau of Land Management in October. The Ivanpah Solar Electric Generating System would be a 370-megawatt facility situated on a 5.6-square-mile project site in the Mojave Desert near the border of Nevada, which is also a habitat and migration path for the desert tortoise.  The environmental groups have challenged the developer, BrightSource Energy, to alter the project's location to reduce the impact on the tortoise, a threatened species. The U.S. Fish and Wildlife service estimated that there were about 32 desert tortoises on the entire site, but a recent removal and relocation effort by the company found 17 tortoises on one portion of the site, a number that indicates there are far more than 32 on the total project footprint.  In light of these recent findings, the California Energy Commission has been petitioned to reconsider its approval of the project, a hearing that was scheduled after press time. Several Native American leaders have also voiced concerns over historical sites and ceremonial grounds within the project's footprint. BrightSource Energy declined to comment.  But the environmental groups recognize the irony of stalling or even outright opposing such renewable energy projects. In fact, as Boyle said, they want these projects to be approved, just in a better way. "These are projects that have a very large impact and we are very concerned to see them put in the right kinds of places where they'll have the least impact on endangered species, and on issues like water quality, air quality and so forth," said Boyle. Douglas at the California Energy Commission contends that the environmental review process for these projects is very thorough, and bats off the suggestion that environmental concerns have been overlooked in the rush to get these projects approved. But she also recognizes that information about projects and their review processes could be better explained to the various constituencies and stakeholder groups that are concerned about these projects. The Commission and the California Department of Fish and Game have teamed up to create a Desert Renewable Energy Conservation Plan, a stakeholder-driven process to draft a long term plan for conservation and energy development in the Mojave and Colorado deserts. Douglas said this is one of the ways the state hopes to improve its process for planning renewable energy projects in the future. "The real value of that kind of planning exercise is it forces stakeholders and government agencies -- including both state and federal agencies, which is critical -- to work together to get on the same page for what renewable energy we expect to see and how we ensure that long term conservation is achieved," said Douglas. She hopes that these sorts of outreach efforts will help refine the state's planning process. And with the 2008 executive order that will require public utilities to derive a full third of their energy from renewable sources by 2020, the state's likely to have a lot more of these planning decisions to make over the next several years. Contacts: Barb Boyle, Senior Representative, Clean Energy Solutions, Sierra Club http://sierraclub.org,  916.557.1100 Chris Clarke, Co-Founder, Solar Done Right http://solardoneright.org/ Erin Curtis, Media Relations, California Office of the Bureau of Land Management http://www.blm.gov/ca/st/en.html, 916.978.4622 Karen Douglas, Chair, California Energy Commission http://www.energy.ca.gov/ 916.654.4989 BrightSource Energy http://www.brightsourceenergy.com/, 510.250.8162 --Nate Berg

Bill Fulton's new book, Romancing The Smokestack: How Cities and States Pursue Prosperity, is a collection of economic development columns from Governing magazine that covers the good, the bad, and the ugly about how economic development is practiced in the United States. It's a quick read -- but informative and entertaining -- on such topics as how Federal Express runs its middle-of-the-night operations in Memphis, the challenge of retaining manufacturing in America, the retail wars among cities in California, and whether cities need population growth in order to increase prosperity. To buy the book, just go here: https://www.createspace.com/3477293

It's been 20 years since California elected a governor with a strong interest in planning and development. And next week's gubernatorial election appears to present a pretty significant choice in the state's approach to these issues. Despite her occasional right-wing rhetoric, Meg Whitman is unlikely to bend in a radical direction. She may suspend AB 32 and focus on job creation, but she's likely to focus on green jobs. She's also likely to try to streamline the California Environmental Quality Act, though it's hard to know � with a Democratic legislature � how likely she is to succeed. Meanwhile, Jerry Brown appears to be � well, he's still the Jerry Brown of 30 years ago, but leavened by the experience of being mayor of a gritty comeback city for eight years. Brown will also focus on green jobs. It's reasonable to expect him to be more aggressive on smart growth issues. And, like Whitman, he'll probably go after CEQA � but in a more targeted fashion focusing on infill development. California's governors have always had a love-hate relationship with planning and development. On the one hand, all governors like cutting ribbons for both big infrastructure projects and big environmental restoration projects. And California has often been ahead of the curve on planning trends nationally. On the other hand, the state and its governors have been mostly resistant to coordinated state efforts to shape development around the state. Pete Wilson, Gray Davis, and Jerry Brown himself all tried to push a coordinated state agenda but most of these efforts have failed in the implementation. Will this trend change? Let's begin with Whitman. No matter what her campaign rhetoric has been � and she has bounced around from the right to the center all year � she is almost certainly a moderate Republican in the Schwarzenegger mold. Her political mentor is Mitt Romney. Whitman worked for Romney's investment firm, Bain & Co., for eight years in the 1980s and she has maintained close ties to him. Like Whitman, Romney ran for governor as a moderate Republican in a liberal Democratic state. In his one term as governor of Massachusetts, Romney established an impressive record on planning and development issues. Among other things, he consolidated all planning-related functions in one state agency and later brokered the regional greenhouse gas emissions compact for the Northeastern states. However, Romney backed away from these accomplishments when he ran for president in 2008. Whitman has showed a similar ideological flexibility, running to the right in the Republican primary and back toward the center in the general assembly. There's nothing in either her background or her campaign materials that suggest she has thought deeply about land use or growth policy. Most of her public statements on the topic have to do with CEQA � and even then her comments have focused on the role CEQA has played in slowing down industrial development, rather than its role in shaping communities. In a widely distributed op-ed piece written in 2009, she called CEQA " jumble of ambiguous rules that require environmental analysis of projects ranging from a nuclear power plant to bike lanes." She specifically stated she was "not advocating gutting CEQA," but focused on the need to streamline it. As an example of CEQA's shortcomings, she pointed to the case of Chevron's proposed expansion of its Richmond refinery. Environmentalists sued on CEQA grounds and a Contra Costa County judge concluded that Chevron's project description was unclear about whether the expanded refinery would be able to process cruder oil. In her op-ed, Whitman claimed the refinery expansion would have lowered emissions. "Despite winning local environmental clearance, die-hard opponents used CEQA's loose framework to get a judge to halt the project, throwing more than 1,000 people out of work," Whitman wrote. As far as I can tell, however, Whitman has never actually specified what kinds of CEQA reforms she would seek. But it is unlikely that Whitman will target CEQA reforms to infill development, as Brown might. Beyond that, she has called for a one-year moratorium on AB 32. But as I wrote in the last issue, it's unclera whether she could extend that to SB 375 and greenhouse gas emissions analysis in CEQA, both of which are protected by separate statutes. Unlike Whitman, Brown has a long record as governor, mayor of Oakland, and attorney general that suggests what direction he will go in. Brown will probably devise a more formal planning and development plan for the state to follow while implementing climate change laws aggressively and seeking to streamline CEQA for infill development. He's also likely to tie everything he can to his green jobs economic agenda. Back in the late 1970s, Brown produced California's first, and so far only, urban growth strategy. It seemed cutting-edge at the time, but said nothing that would surprise present-day smart-growthers: protect farmland and natural resources, focus on infill development, and when greenfield development does occur make sure that it's compact. Typical of the regulation-rich '70s, Brown aggressively pursued air and water quality regulation; it's worth noting that Mary Nichols, Schwarzenegger's Air Resources Board chair who's been pretty aggressive on AB 32 and SB 375, took her first turn at that job working for Jerry Brown. Twenty years later, Brown found himself mayor of a city desperately in need of new investment in old neighborhoods. Frustrated that CEQA permitted in-town residents to use environmental analysis to squawk about traffic, Brown pushed a bill through the legislature that streamlined CEQA review for infill projects � but just for Oakland. Later, as attorney general, Brown pushed the climate change agenda on local governments and their CEQA analysis with his lawsuit against San Bernardino County, saying that AB 32 required analysis of greenhouse gas emissions. The legal settlement required the County to examine GHGs in both its land use policies and its county operations and set the standard for incorporating climate change into general plans and CEQA analyses. Whitman is likely to push for general CEQA reform. But she's behind in the polls and would face a Democratic legislature influenced by environmentalists and by unions that sometimes use CEQA to block corporations they don't like. Brown, on the other hand, is likely to use CEQA and other tools at his disposal � such as AB 857, the never-implemented 2002 law that requires state agencies to follow smart growth principles � to encourage growth in infill areas and discourage growth in greenfield areas. Plus he's likely to select an ARB chair who pushes hard on SB 375 implementation. He's ahead in the polls and will have a Democratic legislature with him � so the Brown agenda is much more likely to move forward.