By Cheryl Weber. In a state that hasn't updated its planning laws in 50 years, Illinois' new law is an example of what's right ? and what's still frustratingly wrong ? with smart growth planning in America today. And it hints at what the building community can look forward to in 2003.

Illinois' law promises technical assistance, and perhaps some funding, to local governments who do comprehensive planning across municipal boundaries.

But solutions to sprawl are proving trickier than state officials' attempts to regulate it. A major reason is people.

The U.S. population grew more between 1990 and 2000 than in any previous decade, adding 32.7 million Americans. In many metropolitan areas, development failed to keep pace with population growth, leading to traffic congestion, nimbyism, and housing prices beyond the reach of working families. In Northern Virginia, Loudoun County supervisors face eight citizen lawsuits challenging their efforts to stop sprawl through exclusionary zoning and land conservation efforts. And in Santa Cruz County, Calif., the second-least-affordable housing market in the country where the median home price is $420,000, a grand jury recently urged the district attorney or citizens to sue county supervisors for doing little to increase the amount of affordable housing.

Supply vs. Demand

Unlike in Washington and Oregon on the West Coast, most smart-growth efforts on the California state level have come to naught. In San Diego, the imbalance between housing supply and demand will likely get worse before it gets better. Currently under consideration is a City of Villages proposal that would identify areas in which to build a town-center-oriented mix of housing, retail, and pedestrian-friendly neighborhoods served by transit. But the city hasn't figured out how to pay for it. In fact, San Diego is already $2.4 billion behind on infrastructure and community support projects.

In San Diego's outlying counties, nimby reactions against density add to the region's problems. Planning officials recently bowed to community pressure in their general plan update, the first in 25 years. "Despite a projected upswing in population growth of a million more people by 2020, they [planning officials] began their plan update by down-zoning 40,000 units, or 100,000 people, from the current general plan," says Matthew Adams, director of government affairs for the San Diego Building Industry Association.

Meanwhile, Stuart Meck, senior research fellow at the American Planning Association in Chicago, says that a lot of what passes for planning in California is done through a stringent state environmental quality act, which complicates the planning process for builders. Adams agrees: "We live in an area where it takes longer to get a building permit than it took to win World War II," he says, "and it's costing our guys a lot of money."

Product Mix

Up the coast in Sacramento, Bob Walter, president of the Sacramento division of Morrison Homes and president of the BIA of Superior California, is beleaguered by increasing building costs related to affordable-housing quotas. "Right now, every fifth house we build must be affordable, or we pay fees," he says. On affordable projects there's no discount on permitting fees, which can cost $30,000 for a single-family house, so the company is forced to recoup the loss by raising prices on other lots in the community. "Affordable housing should be done on a regional basis and be paid for by making it easier for home builders to build it. Or it should be subsidized by the communities," he says, not by builders.

Photo: Paul A. Souders/Corbis

Battle Front: Disagreements over communities like this one in suburban Maryland will keep smart growth on legislatures' agendas. Affordability is a huge issue in Reston, Va., an exurb of Washington, D.C., where rampant growth along the Dulles Airport corridor has sent real estate prices skyrocketing. But affordable-housing requirements are not a hindrance, just part of the process, says Barry Schwartz, COO of Renaissance Housing Corp. "It's usually specific to a certain type of zoning and community. We may buy a piece of land that requires it, and it becomes part of our decision to buy the land." Still, the builder has tweaked its product mix to meet smart growth and density goals and ? bottom line ? to build homes people will be able to afford. Whereas five years ago Renaissance was building 100 percent large-lot single-family homes, now, 33 percent of its products are $200,000 condos, townhouses, and homes on small lots. "Certainly a bit of this is being creative and expanding what we do," Schwartz says. In Atlanta, where, on average, citizens drive more than 35 miles daily, the challenge is to figure out how to meet the market demand for more housing in existing town centers and suburban business districts. Planner and consultant Greg Logan, with the Urban Land Institute in Atlanta, estimates that one-third of the market is looking for more compact and conveniently located homes, and that there's a 15 percent gap between supply and demand. The fastest-growing job centers are also in places where it's hard to do housing for a broad spectrum of people because of nimbyism. "We need to remove the barriers to fulfilling market demand," Logan says. "There's so much mythology about high density ? that it causes traffic and lowers housing values. But it doesn't if you add green space."

The Atlanta Regional Commission's answer to the dilemma is the Livable Centers Initiative, probably the nation's biggest program geared toward balanced growth. (See for more information). Despite this vigorous approach, developers are still dealing with 60-some different political entities and the attendant zoning tangles. "The biggest issue is that a lot of the zoning isn't responsive to changes in the market," Logan says.

"Some developments have required as many as 20 to 30 variances. You say, 'What the hell. I'm going out to the suburban fringe, the path of least resistance.' I think a lot of developers and builders want to respond to this market opportunity but few have the fortitude to put up with that. On the plus side, the builder who figures out how to do that has less competition."

Next Year

The $64,000 question, of course, is whether all this churning over smart growth will make a real difference in future development patterns. While some experts contend that the movement's impact on metropolitan areas has been insignificant, others believe it is powerful enough bring change over time. Planner Stuart Meck says builders who are developing on greenfield sites will continue to be confronted with some aspects of smart growth. And, he says, builders have not fundamentally grappled with review and permitting issues on municipal and state levels.

Strategies 2003: Local Notions

"The home building industry seems to have spent a lot of effort trying to enact legislation that punishes local government through damage revenues, rather than addressing reasonable expectations about approval," Meck says. "With the exception of Oregon and Rhode Island, I haven't seen any good examples of home builders saying we've got to fix this system and make sure it operates efficiently so we know how long our capital is going to be tied up before we can start building."

In Meck's mind, there's no question that the smart growth movement is here to stay. But the only way we'll know what kinds of changes are occurring, he says, is by looking at the next census reports. "If we see vehicle miles per capita dropping, gross density in metro areas increasing faster than the population rate, and farmland consumption dropping, then there will be some evidence that these policies are having an impact," he says.

Published in BIG BUILDER Magazine, December 2002