Race-to-the-Top For Development

Moneybox
A blog about business and economics.
Sept. 12 2012 8:27 PM

Federal Policy To Encourage Infill Building

In an excellent review of a new book from Aaron Ehrenhalt, Ben Adler notes a few smart Obama administration initiatives designed to help facilitate greater reliance on urban infill projects rather than NIMBY practices that limit access to scarce urban neighborhoods:

How then to tackle the changes that The Great Inversion ably documents? For one thing, we need a national mobility strategy that invests heavily in mass transit, makes streets safe for biking and walking, and links affordable housing to transportation. The Obama Administration has the right idea: The Department of Transportation (DOT) awards grants on a competitive basis to the most innovative, economically efficient, and environmentally sustainable transportation projects through TIGER, the Transportation Investment Generating Economic Recovery discretionary grant program. The DOT is also working with the EPA and the Department of Housing and Urban Development through the Partnership for Sustainable Communities, President Obama’s signature metropolitan policy innovation, which works on linking transportation projects, affordable housing developments and other communal investments.
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In some ways I think the most exciting thing along these lines that the administration has done is the revised version of the DOT New Starts grant formula for mass transit programs. Not to get too thick in the weeds, but the basic gist is that the old formula heavily weight transportation speed in a way that encouraged transit investment to focus on park-and-ride commuter rail. Now a project is more likely to be funded if more people are likely to use it, which correctly titls the scales in favor of stations that are surrounded by buildings rather than parking lots.

But as Adler writes, ultimately this comes down to the fact that local governments need to "turn their attention to zoning reform." This isn't really a federal issue, but Josh Barro recently had the clever idea of something like a federal race-to-the-top incentive program for housing. The idea would be to create a pot of money and then give the money to municipalities that take action to allow for more housing supply, with the funds helping to overcome both legislator inertia and the rampant NIMBYism that afflicts too much of the country. 

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

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