Posted on 04/07/2007 7:23:39 PM PDT by WayneLusvardi
NIMBY's versus Socialism - Open Space Now Becoming Socialized Good
The Pasadena Pundit- April 7, 2007
Up until now new homeowner's have been willing to pay for open space land surrounding their tract homes - and for good reason because such amenities translate into pricey view premiums when the homes are re-sold. But now a developer has imposed a fee on new homes for open space that benefit property owners other than the homeowners paying the fees. We might call this open space without value capture. Now realtors are balking because when the homes are re-sold that fee will not be recaptured in the price of the home because it accrues to the value of someone else's home.
This is like buying a new car and as soon as you drive it off the lot it depreciates in value. But the lost value will transfer to someone else's car.
New home subdivisions often have bond financing (Mello-Roos or other bonds) to pay for public infrastructure such as roads, offsite freeway interchanges serving the development, utilities, fire stations, etc. The new open space fee is like creating an assessment district in your new home subdivision for the benefit of someone else's subdivision. Needless to say this creates the impression and the reality of being ripped off.
This will create a quandary for tax assessors. They will now have to adjust sales prices downward for the uncapitalized open space fees paid as part of the sales price of a new home.
This is the start of open space becoming a socialized economic good -- everybody pays into a huge pot no matter if you benefit or not. This is a radical departure from the paying for open space as a private good with public funds through public agencies or quasi-public open space conservation agencies.
The acronym NIMBY (Not-In-My-Backyard) will now take on a double meaning. Conventionally NIMBY means "do not put a nuisance in my back yard which will hurt my property value." Now NIMBY will also mean "do not coerce me to pay for someone else's open space view amenity which is 'not in my backyard.'"
Of course, socialized open space is a product of the expansive California welfare state, which now provides oxymoronic luxury "affordable housing" via inclusionary housing laws, subsidies for luxury hybrid vehicles purchased by public agency employees, and tax credits and subsidies for roof-top solar energy panels for the wealthy paid for by the working class which can't afford such luxury environmental goods.
For more on the developing story of NIMBY's versus Socialism see here: http://www.sacbee.com/103/story/150928.html
If the developer has imposed the fee for open space, so what? Don’t buy in the development if you don’t like it.
Mrs VS
Good point. But developers are having this foisted on them by lawsuits. The statewide Realtors’ group has sponsored Senate Bill 670 by Sen. Lou Correa, D-La Habra, to stop the practice before its roots grow deeper into the state’s residential construction sector. The bill is set for a first hearing April 17 before the Senate Transportation and Housing Committee. See excerpt from Sacramento Bee below:
Such Capitol showdowns typify California’s housing scene where builders are often expected to fund environmental and affordable housing demands to settle lawsuits and win permission to build. These demands come on top of local government fees for schools, roads, police and fire protection, and parks that can easily top more than $100,000 a home.
It looks like open space is becoming a “tragedy of the commons”.
The Tragedy of the Commons
Garrett Hardin (1968)
“The Tragedy of the Commons,” Garrett Hardin, Science, 162(1968):1243-1248.
http://www.freerepublic.com/forum/a391f6d546577.htm
It took a few generations for the "unintended consequences" to kick in, but many of us in the land development business saw the inevitable even back then, at the beginning of a mindset that is now a solid "right": the ability to claim a "public right" for private property.
It all began in the 60s...
The disintegration of the social contract, specifically the unspoken duty to care for and provide for future generation, exactly as previous generations provided for us.
Highways and streets, Huge water supply aqueducts built to serve population 50 years into the future; Water treatment plants, sewage treatment plants, all sorts of "necessities" which current homebuyers pay for twice or more times.
I know all about the NIMBY contradiction. Factor in the bureaucratic mentality that ever-increasing taxes are their right, and we end up exactly getting what we deserve; or rather our grandchildren getting what we deserve.
For allowing the most unethical generations totally to destroy that ageless social contract.
Very well stated. Remember how CEQA (California Environmental Quality Act) started? If I remember correctly, enviros won a lawsuit against development and this then morphed into state law. This could happen here too. It already has happened with inclusionary housing, solar panel subsidies and tax credits, and other environmental luxury goods.
Is there a reason why developers in CA don't pick up their business and relocate to NV or someplace else? Why do they stay?
It is now too late. The damage has been done, and there's no going back.
The time this should have happened to be effective was when the "great idea" was planted in the bureaucracy's mind, three generations ago.
When the amount of "fees" for the privilege of building new homes equaled the entire cost of a home 15 years prior, the red flag should have been obvious to everyone. It wasn't.
There were always the hit and run developers, who were sure, at a more prosperous period, that no matter how high the price of a home became, they could profit by "going along" with the naked legal extortion.
The NIMBYs, of course, were ecstatic, seeing the value of their homes skyrocket, forgetting that no matter how much their paper profit, unless they were willing to move into a tent, they would profit by the new system mainly by dying...
Actually, CEQA was the logical successor to the national Environmental Quality Act, soon after the great unwashed and the opportunists discovered the word "environment'.
Ironically, the original EPA was never intended to apply to any project smaller than huge interstate projects that affected two or more states, for the specific reason that all possible consequences be considered, and to avoid unintended consequences.
It was never argued, nor was it intended that it should ever apply to ordinary construction projects funded by private industries, certainly not, as is true now, to have the jackbooted Corps of Engineers come knocking at your door claiming "wetlands protection" for that hole you neglected to fill in after your children built that fort last year.
Or your reclaiming that drainage ditch which now draws pests and vermin.
Creeping incrementalism more deadly than the worst nightmare of 40 years ago...
The children of the marriage between unchecked bureaucracy and the ignorant NIMBYs.
Wouldn’t the “fair” way of doing this to make the whole development a Homeowners Association, and then each lot actually owns a share of any common areas?
Of course, their are disadvantages to HOAs too...:^)
You’re welcome. Even though Hardin was a flaming liberal, I found his approach to be insightful. “In an approximate way, the logic of the commons has been understood for a long time, perhaps since the discovery of agriculture or the invention of private property in real estate.”
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