The Courtyard Urbanist Reminds Us Sprawl Costs Us All

(c) by Mark Dempsey 

The Courtyard Urbanist, blogger Alicia Pederson, decries the supposed savings of big-box retail with a detailed cost breakdown of how much storage space and delivery expense customers of big-box stores like Costco need to add when they live and shop in suburban sprawl. After all, Costco sells in such large quantities that buyers couldn't possibly consume them all right away, so they need storage space and must drive to pick up the goods.

Ms. Pederson compares the expenses demanded by sprawl big-box shopping to the city experience of walking to smaller stores. "In a city, you can live with a smaller kitchen, pantry, and refrigerator because the neighborhood itself functions as your pantry. Multiple grocers, bakeries, pharmacies, etc are storing things nearby until you need them. In the burbs, the stores are farther away, so households have to buy in bulk and store things at home."

A car is not optional in sprawl, either.  Sprawl dwellers must own, maintain, store and insure an automobile--typically one for each driving-age adult. Never mind shopping at the big box store, if people living in sprawl want to work, or go to school, or even go to the park, they typically must drive. 

Owning a car amounts to a regressive tax. How much? "Owning and operating a new vehicle costs $11,577 a year. A pickup costs about $6,402 a year more than a small sedan, and a medium SUV about $4,200 more (AAA, 2025)."

In addition to the vehicle and extra garage space for that second freezer, other costs include:

"1. The time. The average American shopping trip is 8 miles, as of 2017 (NHTS). People who shop for groceries on a given day spend 46 minutes in the store, not counting the drive (USDA ERS). [The fastest-growing demographic in the US is the over-85 set so one could add the assisted living bill to this figure because our elders are less able to drive, and cannot age in place.]

"2. The public bill. Across 17 studies, compact development costs 38 percent less than conventional suburban development in upfront roads, sewers, and water lines (Smart Growth America). Someone pays the difference, usually through local taxes and fees.

"3. What nobody prices. Social isolation, sedentary days, and a sparse community life. I won’t put numbers on these, but these social and health effects add color to the picture here."

I'd add that the US's epidemic of obesity, heart disease and diabetes could be connected to that sedentary lifestyle in which what passes for exercise is pressing the gas pedal and brake.

Unfortunately, Ms. Pederson believes "Land use (zoning) shapes ALL of this." 

If only that were true! True, zoning is part of what shapes land use, but the kind of development approved by local governments still typically needs construction and permanent financing. Banks are reluctant to lend on projects outside sprawl norms.

Sprawl itself has its roots in "white flight" from a racially integrated central city, and has been blessed by the government agencies that guide home loans--FNMA, GNMA, FHA, etc. As one planner says, "It's not 'Form follows function,' it's 'Form follows finance.'"

Another omission in Ms. Pederson's account is the enormous profit available from land speculation. When the speculators can buy outlying agricultural land for a few thousand dollars an acre, then increase that land's value 50 to 100 times more by persuading local government to permit development, then the incentive is to avoid compact, infill development, and try to make more edge city sprawl. The fact that the speculators get huge tax breaks on that profit--1031 exchanges--only adds to their fortunes.

In Germany, the developers must sell that outlying land to the local government at the ag land price, then repurchase it at the upzoned price. All of the egregious profit--the "unearned increment"--accrues to the public rather than some speculator's private fortune. And it shows, too. The arts budget for just the City of Berlin exceeds the National Endowment for the Arts for the entire US. 

In fairness, there are land speculators who have tried to benefit the County. Former State Treasurer Phil Angiledes had an approved sprawl map for his Laguna West development and he courageously set that aside for a pedestrian-friendly, mixed-use development designed by Peter Calthorpe. 

Such designs require density if they are to be financially viable. According to UC Berkeley planner Robert Cervero, they must build at least 11 units per acre to provide enough customers for neighborhood commerce and transit to become financially viable. 

Predictably, Calthorpe's design had some lower-density neighborhoods surrounding twenty-unit-per-acre two-story apartments at the development's core. Unfortunately, construction financing for apartments was not available when it was time to build, so the subtle sabotage of seven-to-the-acre homes prevailed. Commerce and transit limp along in Laguna West as a consequence.

As for zoning: in practice it often fails. In California, it's typically "use-based," and decided years before any building occurs. Designating parcels as residential, apartments, industrial or commercial relies on the best guess of what the market will demand years before that demand arrives. This means there's a cottage industry of attorneys and other consultants lobbying to change those premature zoning designations, and a host of land speculators ready to hire them.

We could have form-based rather than use-based zoning that simply designates building sizes, but that would upset too many well-funded apple carts, so it's ignored even by professional planners. 

Finally, in fairness to Costco, they have built a store in Los Angeles with apartments above it. Adding apartments to existing shopping centers would create built-in customers and transit hubs. Some reports say such "lifestyle centers" that combine commerce and residences even show higher per-square-foot sales than single-use malls.

As malls fail because of online competition, there are signs such mixed-use plans are in the works, but precious few have been built in the US. 

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The author was a real estate broker, appraiser and loan officer for nearly two decades, and sat on a Sacramento County Planning Advisory Council (CPAC) for nearly one decade. Local residents may recognize that there's a two year term limit for CPAC members, but, says the author, no one else was dumb enough to apply.