Want more housing? Build a landlord.

If we’re going to have a lot more missing middle housing; we’re also going to have a lot more landlords

Accessory dwellings, duplexes, triplexes and fourplexes are suited to “mom-and-pop” landlords, but tough tenants rights requirements may discourage many homeowners from creating more housing.

By Ethan Seltzer

City Observatory is pleased to feature this guest commentary by Ethan Seltzer. Ethan Seltzer is an Emeritus Professor in the Toulan School of Urban Studies and Planning at Portland State University. He previously served as the President of the City of Portland Planning Commission and as the Land Use Supervisor for Metro, the regional government. He has lived and worked in Oregon and the Portland region since 1980 and is a contributor to City Observatory. For the past 8 years he has been the co-owner of one rental unit in the City of Portland that has been in the family for 11 years.

Portland, like a few other states and localities in the US, is rethinking it residential zoning. Single household zoning occupies about 40% of the land in Portland, and the lion’s share of land zoned for residential use. Today, Portland is growing rapidly, but the new housing to accommodate that growth is largely being built outside of the single household zones.

Sure, Portland has had zoning to allow Accessory Dwelling Units (ADUs) on the books since 1980, and has long allowed, by right, duplexes on corner lots in single household districts. However, those housing types have amounted to a mere trickle of new housing capacity in the last 40 years, particularly when compared with the rate of population growth and its associated growth in the demand for new housing.

A fourplex in Northeast Portland.

In recognition of the role that every residential zoning district and every neighborhood has to play in meeting the needs of Portland residents for suitable, affordable housing, the City embarked on its “Residential Infill Project.” The Residential Infill Project, or “RIP,” was created to devise new rules for adding missing “middle” housing types to existing neighborhoods:

By updating the rules that govern the types of housing allowed in our neighborhoods, we have an opportunity to accomplish two main goals: 1) Expand housing choices in residential neighborhoods to help ensure a more inclusive and diverse community. 2) Limit the size of new buildings to bring them more in line with existing homes. (https://www.portlandoregon.gov/bps/article/738843, page two)

Far from a wholesale demolition order for existing neighborhoods, the Residential Infill Project envisions an orderly and incremental addition of new housing types to existing neighborhoods, including the retention and modification of existing structures to contain more than a single dwelling unit.

However, missing completely from the RIP is the fact that the creation of new “middle” housing units brings with it the creation of a vast number of new landlords. Phrased another way, the success of Portland’s Residential Infill Project rests entirely on the emergence of a large number of individual land and homeowners willing to become landlords. Build an ADU, and you are now both a homeowner and landlord. Convert a single household dwelling into a duplex or triplex, and you’ve become a landlord.

Because of the incremental nature of the changes, and the relatively small scale of the infill, economies of scale are hard to come by. Certainly someone will figure out a business plan to take advantage of this new development capacity at scale. For the most part though, it is dependent on individuals willing to assume the risk of being a landlord. In short, meeting the goals of the Residential Infill Project to expand housing choices in all neighborhoods and for all households, and to keep new development small in scale, requires a new cadre of committed landlords.

Interestingly, just as the City and the State of Oregon are taking steps to require “middle” housing development opportunities in all single household zones, they are also taking steps to enact new tenants’ rights laws at the behest of the same coalitions advocating for the zoning changes. In Oregon a desire to sell a unit is no longer a legal reason to ask a tenant to leave. In fact, tenants now have a right to stay until the owner has a signed sale agreement with a new buyer. In Portland, no-cause evictions are, for the most part, illegal.

If you are a large landlord, this is simply adding to the cost of doing business. Leases will change, lawyers will be involved, and rents will rise to incorporate and cover these new costs of being a landlord.

However, for small landlords, owners of single rental units, or those contemplating using their existing properties more intensively, these new controls on the real excesses of corporate housing rental companies will also apply, for the most part, to them. This means that the uncertainty associated with owning rental property has just shot up for those considering becoming a part of the “middle” housing movement in Portland and Oregon.

The reaction on the part of small, prospective “middle” housing landlords could take several forms. They may decide to skip it entirely. Or, they might make affordable rents much less affordable to cover the risk. Or they might not put the units they create on the market, renting instead through AirBNB or simply through word of mouth to friends and family.

In all cases, the lack of attention to the needs of small landlords in both the tenants’ rights acts and the Residential Infill Project does not bode well for encouraging a large new group to become the landlords that Portland needs. In short, we’re on a path to become a city of impersonal, large, corporate landlords when what we’ve been working towards, apparently, is just the opposite.

Of course, it doesn’t need to end up this way. Portland could take steps to encourage and incentivize small landlords. It could recognize that there is a world of difference in capacity between those owning 4 or fewer units and those building 50 units at a crack. It could do more to bridge the gap between small landlords and tenants, creating programs to help them find each other and to negotiate mutually fair and supportive leasing agreements. It could even be so bold as to create nonprofit, neighborhood-based housing management associations to make it easier, simpler, and more transparent for investors and tenants to find and hold places in our City.

Unfortunately, the City is pursuing none of these, or to my knowledge, any others. To date, the City is seeking “middle” housing at the same time that it’s villainizing the landlords it’ll need to be successful. Tenants’ rights are important and needed. But more landlords are needed now. Landlords and tenants need each other, and simply changing the zoning is, at best, less than half a step in the right direction.

The shaky argument for the Columbia River Crossing

Despite claims from Oregon DOT officials, the only published seismic studies suggest the I-5 bridges will survive a Cascadia earthquake.

It’s far from clear that spending billions to replace this bridges is a good investment to protect lives and the economy

By Robert Liberty

City Observatory is pleased to publish this guest commentary from Robert Liberty, a former Councilor of Portland’s Metro regional government and who has had more than 30 years of experience with transportation policy and project development including serving on the Metro Council during the period it approved the Columbia River Crossing project. 

Much of the Pacific Northwest lives in palpable dread of the next Cascadia Subduction Earthquake, a massive seismic event that has occurred repeatedly over thousands of years, according to the best available interpretations of the geologic record.  The Cascadia fault line, which runs along the coasts of Oregon and Washington could produce a 9.0 quake that would devastate unreinforced buildings and other infrastructure.

As any salesperson will tell you, fear of a possible catastrophe is a great selling proposition. So it’s little surprise that the Oregon Department of Transportation (ODOT) has trotted out concerns about the next Cascadia quake as a reason to pony up billions of dollars to replace the I-5 bridges across the Columbia River that connect Portland Oregon to Vancouver Washington.  According to Oregon Public Broadcasting, ODOT’s Assistant Director Travis Brouwer claimed the I-5 bridges:

 “would likely collapse in a major earthquake.”

That is sounds scary, but the trouble is, there is no basis for that statement according to the technical work commissioned by . . . the Oregon Department of Transportation

Brouwer’s claim is contradicted by a 2009 study ODOT commissioned of the seismic risk to bridge structures: Seismic Vulnerability of Oregon State Highway Bridges: Mitigation Strategies to Reduce Major Mobility Risks.

In the study “bridges” include overpasses, viaducts, ramps, – any elevated structure, whether over a water body or not. The study modeled the impact of several earthquakes in Oregon; one near Klamath Falls, another near Salem, a major earthquake under the West Hills of Portland and magnitude 8.3 and 9.0 Cascadia Subduction Zone earthquakes (9.5 is the highest magnitude earthquake ever recorded.)

According to the study, none of those earthquakes cause the I-5 bridges to collapse.

In the Cascadia Subduction Zone quake of 9.0 magnitude, on I-5 in Multnomah and Clackamas County, five bridges would suffer “slight” damage and one would suffer “moderate” damage with the repair or replacement cost coming to $8 million.  (Page 48.  There is also a hard to read map showing damage levels on the bridges.)

In the 8.3 Cascadia Subduction Zone earthquake, on I-5 in Multnomah and Clackamas Counties, one bridge is slightly damaged, with the repair cost estimated at $400,000.  (Report page 49.)

The most damaging quake is a 6.5 West Hills quake. In the Multnomah-Clackamas section of I-5  that would cause 8 bridge structures slight damage, 11 bridge structures moderate damage, 10 bridge structures extensive damage and one bridge structure would suffer “complete” damage, means collapse.  (Page 50.)

There is no map. However, it is very unlikely that one of the two Interstate Bridges is the one that collapses, since the combined cost to replace or repair these 30 damaged I-5 bridges is estimated at $483 million.  That is quite a bit less than $900 million budgeted for the replacement bridge in the Columbia River Crossing.  (The new bridge represented about a quarter of the total CRC project cost.)

The seismic risk study includes a summary table showing that for $446 million, less than Oregon’s proposed contribution to the Columbia River Crossing project ($500 million) Oregon could retrofit 95 bridge structures on I-5 from the Columbia River to Marion County, to the highest level of earthquake resilience (Phase II standard.)  (Report page 56.)

A limitation of the study was that it did not consider liquefaction, the effect caused by shaking of wet soils (like shaking a bowl of oatmeal in which water rises to the surface.) ODOT has not conducted, or at least published a study of the risks to state highways caused by liquefaction. Yet, in the absence of that study senior ODOT staff feel free to state an unsupported opinion that the bridges would likely collapse.

(Indifference to research and data is not limited to ODOT staff. During the CRC controversy I showed the ODOT seismic bridge risk report to a senior Washington state legislator pointing out the relevant tables and paragraphs. He did not look at the report but simply stared at me and said “That’s your opinion.”)

But this focus on the seismic risk to two bridge on I-5 to justify a $3.4 billion freeway widening project typifies one of the major defects of transportation project analyses – focusing on one issue without considering the broader context, trade-offs or less costly alternatives.

For example the West Hills quake was projected to cause $483 million in damage to the bridge structures on, under and over I-5 between the Columbia River and Marion County including one collapse. But it causes only $14 million in damage to I-205. (page 50.) Why wouldn’t it make more sense to invest $294 million to retrofit I-205 to the Phase II standard to maintain a north-south highway connection through the region including a bridge crossing across the Columbia in the event of a major quake instead of $900 million just to replace two existing bridges?

(It is worth noting that the report shows that the cost of retrofitting of 145 bridge structures on I-5 and I-405 to the Phase I seismic safety standard was estimated at $178 million, less than the CRC study.)

If we broaden our geographic perspective a bit but remain focused just on bridges, the report projects catastrophic damage to the bridges along the Oregon Coast from a 9.0 Cascadia subduction quake and all the approach roads from the interior. If our priority if human life and rapid recovery, should we focus our transportation dollars on where they may save many lives or where they will avoid disruption to commuters?

Applying a statewide perspective leads us to a more basic question: Why does ODOT propose a massive investment in one project to benefit one set of Portland-area commuters while simultaneously documenting that the percentage of ODOT bridges in “good” condition declined from 40% in 2008 to 20% in 2018 and that 43 bridges on I-5 are structurally deficient, according to its 2018 Bridge Condition Report.

But even this perspective is too narrow because the ODOT CRC proposal did not address – and cannot address – the bigger question of whether roads and bridges represent the greatest health risk from a big quake.

Thousands of Oregon students attend school in vulnerable unreinforced masonry buildings. Strengthening pipes supply clean water and to carry away sewage treatment and to maintain energy supplies might be a higher priority in preparing for an earthquake, than keeping open a commuter bridge. Rather than serving as an all-purpose excuse of any big construction project, a serious seismic strategy would prioritize projects that had the biggest benefits in reducing likely casualties, and making the region more resilient in recovery from “The Big One.”

Has Oregon learned anything from the Columbia River Crossing debacle? One clue is who the Oregon Transportation Commission hired as its new Director in September of this year; Kris Strickler. OPB noted that Strickler “directed ODOT’s involvement in the Columbia River Crossing bridge project in the first half of this decade, before the $3.4 billion effort to replace the bridge connecting Portland and Vancouver collapsed in 2014.”

And perhaps that is the kind of collapse we should be worrying about most.


No deposit, no return: Another lie to sell the Columbia River Crossing

State DOT’s are using a false claim about financial liability to revive the Columbia River Crossing folly

There’s no requirement to repay $140 million in federal funds, if states choose the “No-Build” option

The Oregon and Washington department’s of transportation have a scary argument for reviving the failed $3 billion Columbia River Crossing project.  They’re telling everyone who will listen, that if we don’t get on with building the bridge by 2025, we’ll have to repay the federal government $140 million. That threat has prompted the two states to revive the bridge.

No deposit, no return: Oregon and Washington don’t have to repay the $140 million of federal money they wasted on the failed CRC.

The argument goes like this.  Between 2004 and 2014, the two states spent almost $200 million to plan and engineer the bridge.  About 70 percent of that money came from the federal government.  But in 2013 and 2014 respectively, Washington and Oregon both walked away from from the project. The two state DOTs are now saying that if you don’t move ahead with the project, you’ll have to repay the federal government $140 million, the federal share of monies that were used to design the project and conduct its environmental impact statement.  If we don’t start condemning right of way and turning dirt in five years, we’ll have to pay a $140 million bill.

The DOTs have gotten the media to uncritically parrot this message. The Oregonian’s Andrew Theen reported:

The states now must show considerable progress, including buying up necessary right of way, by the end of September 2024. If the states don’t accomplish that goal, they could owe a collective $140 million to the federal government for planning costs related to the past bridge effort. Oregon’s share is $93.3 million.

Oregon Public Broadcasting’s Dirk Vanderhart said:

. . . lawmakers are also acting with some urgency. As things currently stand, the states have five years to make substantial progress on a bridge, or pay back roughly $140 million in federal funds from the last failed attempt.

Jeff Mize of the Columbian also echoed the talking point:

The Federal Highway Administration previously granted a five-year extension, which means Washington and Oregon would be obligated to repay the $140 million if efforts to replace the bridge were not renewed by Sept. 30.

The threat of having to repay these funds is prompting driving political leaders to pump an additional $44 million into reviving the bridge planning, even though none of the fundamental problems that sank the last effort has been resolved.

Choose the “no build” option; No repayment required

The trouble is, this claim is utterly false:  The Federal Highway Administration (FHWA) does not require funds to be repaid, if as part of the environmental review process, the sponsoring agency selects the “No- Build” option.

Here’s how FHWA explains this on their website:

The FHWA does not require repayment of PE funds when project termination is directly related to compliance with another Federal law. For instance, repayment of reimbursed PE costs would not be required if FHWA and a State DOT determine that a project should not be advanced as a result of findings during the National Environmental Policy Act (NEPA) process. To do otherwise could skew the NEPA process by causing a State DOT to favor a “build” alternative to avoid repaying PE costs incurred during the NEPA review.

As the FHWA explanation makes clear, if it required repayment of funds for every project that didn’t go forward, it would undermine the entire purpose of the National Environmental Policy Act.  A repayment requirement would be a loaded fiscal gun, forcing states and cities to go ahead with projects that don’t make environmental sense in order to avoid a repayment liability.  And that’s exactly what the two State Departments of transportation are trying to convince people of in the case of the CRC; and it’s simply not true.

No one is repaying the $6 million spent on the failed “Salem River Crossing”

Lest anyone doubt that this is the case, consider that this is exactly what is happening the another abortive ODOT bridge building project, the so-called “Salem River Crossing.” Over the past decade ODOT and local governments in the Salem area have spent more than $6 million planning a new bridge across the Willamette River just north of downtown Salem. Just as with the CRC proposal, the project has foundered over community environmental concerns, and problematic and unresolved funding issues. Earlier this year, The Salem City Council formally withdrew its support for the project and instructed ODOT to proceed with the No-Build option. No repayment required:

. . . the City Council on February 11, 2019, voted to send a letter to the Oregon Department of Transportation (ODOT) and the Federal Highway Administration (FHWA) to take no further action on the remaining land use actions needed for ODOT to complete the Final Environmental Impact Statement for a new bridge. As a result of this action, city staff will work with ODOT and FHWA to complete the Salem River Crossing project with No Build as the preferred alternative. The option to do nothing, referred to as the No Build alternative, is always an acceptable option to conclude an Environmental Impact Statement process

And neither Salem nor ODOT is about to repay a dime of the money used for planning and engineering the now dead Salem River Crossing.  They don’t have to, because pursuant to Federal regulations,  FHWA chose the “No Build” option based on the city and state decisions..

When it comes to the CRC, all that ODOT and the region need to do is select the “No Build” option studied as part of the Columbia River Crossing Environmental Impact Statement process.  Doing so would eliminate the liability for repaying the federal government for this effort, which everyone must now acknowledge as a failure.

Once again, the DOTs are lying to try to push the CRC

It may make sense to re-examine the I-5 bridges, and consider a wide range of alternatives. But there’s no reason to have the costs of that failed effort hanging over peoples heads as they consider what to do next. It’s dishonest of the state departments of transportation to tell people there’s a $140 million penalty for not moving forward with this project.

Willamette Week’s award winning expose on the Columbia River Crossing.


The Columbia River Crossing has a long history of lies.  The effort to revive the project shows that its proponents are just as mendacious as ever.

Editor’s Note:  This commentary has been revised to correct the dollar amount referred to in the penultimate paragraph, it is $140 million, not $140.

The city as labor saving device

Great cities, especially ones with dense, walkable mixed use neighborhoods are an economic boon to households because they save the precious commodity of time

The latest in labor-saving technology: a walkable city. (Portland Mercury)

Labor-saving devices and economic welfare

Stories of economic progress appropriately revolve around major technological breakthroughs.  There’s little question that the advent of steam, the harnessing of electricity, and the development of digital microelectronics have helped propel economic growth.  But to many humans, the biggest gains in well-being have come from inventions that save us from the drudgery of time-consuming daily tasks.

Simple things that we now take for granted, like piped domestic water, indoor plumbing, refrigerators, central heating, washing machines, vacuum cleaners, and automatic dishwashers save the typical household countless hours of mind-numbing and back-breaking labor, freeing our time for other pursuits (like checking our Instagram feed).

Some of the most important technologies in improving our personal well-being have come from some of the most seemingly prosaic household inventions. As the Washington Post’s Anna Swanson writes:

These technologies were so disruptive because they massively reduced the time spent on housework. The number of hours that people spent per week preparing meals, doing laundry and cleaning fell from 58 in 1900 to only 18 hours in 1970, and it has declined further since then.  That change has made it possible for Americans to spend much more time at leisure and at work — specifically for women, who were responsible for almost all housework, to get jobs and become economically independent. Just 100 years ago, most married women were working at home. Now, about 57 percent of working age women are in the labor force.

Perhaps the reason they are so little heralded, by comparison to say microelectronics, is that these inventions saved the time and reduced the work of women. A good case can be made that this collection of household technologies played a key role in advancing the feminist agenda–although clearly a Jevons paradox of rising expectations of domestic perfection also accompanied home automation.

The city as labor saving device

In theory, new technologies are advancing the progress in domestic time-saving:  the Roomba is a decided advance on the Hoover.  But almost unnoticed, there’s another technology, all around us, that is a critical labor-saving device:  the city.  We don’t think of it that way, but a city or a great urban neighborhood is a crucial means for households to economize on the one resource, that regardless of income they can’t get more of:  time.

As I argued in my 2007 study for CEOs for Cities:  City Advantage, among the critical economic advantages of cities are convenience and variety:  more consumption opportunities of all kinds are readily available close at hand, and the density and diversity of choices reduces the time and effort consumers need to find and get just the goods and services they most desire.  In effect, a great urban environment functions as a labor-saving device for its residents.

This key economic attribute of cities is either completely ignored or greatly discounted in most common analyses of cities. Comparisons focus on easily gathered, but greatly misleading comparisons of, for example, average rents, and ignore the fact that in some cities (especially those with cheap rents), there are few consumption choices nearby.

Our work at City Observatory maps out the evidence for these critical variations in labor-saving proximity in different cities and different city neighborhoods.  Our analysis of the connections between home values and walkability shows that homes proximate to a greater concentration of common destinations (schools, parks, restaurants, bars, coffee shops, and grocery stores) command higher prices than otherwise similar homes in areas with less access to these destinations.  Our Storefront Index shows the concentration of walkable destinations in commercial districts in cities, and corresponds closely to those places that offer residents high levels of convenient, time-efficient consumption opportunities.

Our storefront index map shows where shops are nearby, and where they’re scarce.

In contrast to sprawling suburbs or rural areas, where residents have to routinely drive long distances to reach common destinations, whether buying a gallon of milk, getting a haircut, drinking a latte, or getting a slice of pizza, all of those destinations might just be a block or two away in a dense urban environment (and not much further in many city neighborhoods). In addition to the convenience of shorter trips, urban residents typically have a much wider range of choices close at hand, another value of cities that is generally overlooked.

As we’ve documented in our studies of the Young and Restless, and as other research has shown, well-educated young adults are increasingly moving to dense urban neighborhoods. A key motivation for choosing cities, despite the higher rents that one generally pays, is that cities offer unique advantages in saving time in getting the things you want. Especially when it comes to services and experiences, cities have a powerful competitive advantage over other locations:  For physical stuff, Amazon Prime may offer next day delivery wherever you live; but for the restaurant meal, mixed, drink, hair styling, back massage, or child care you want today, you can get it faster and more easily in a city than anywhere else.

The Week Observed, November 22, 2019

What City Observatory did this week

1. No Deposit, No Return: Another lie to try and sell the $3 billion Columbia River Crossing. The state’s of Oregon and Washington spent nearly $200 million planning the failed Columbia River Crossing, a 12-lane, five mile long freeway project connecting Portland and Vancouver, Washington. The two states walked away from the project over irreconcilable disagreements over the project and its financing. The two states’ departments of transportation have urged a revival of the project, saying that if they don’t break ground in the next five years, they’ll have to repay the federal government $140 million. That’s panicked some political leaders into throwing an additional $44 million in new money after the $200 million already spent. And, unfortunately, there’s actually no requirement that the money be repaid:  Federal Highway Administration regulations specifically waive repayment if local governments choose the “No-Build” alternative as part of the environmental review. The original CRC proposal was plagued with mendacity: false traffic projections, designs for an unbuildable, and then too-low bridge. The revived project seems to be setting out in the same dishonest path.

2. To solve the housing shortange, build a landlord. There’s growing interest in policies that re-legalize so-called “missing middle housing”–duplexes, triplexes and fourplexes, and which make it easier to add accessory dwelling units (ADUs) in single family zones. All of these policies envision “gentle density” which add a few units in built up neighborhoods.  All well and good, but as City Observatory friend Ethan Seltzer argues in this commentary, all of these units will require new landlords. If we’re going to incentivize the development of duplexes and ADUs, we’ll want it to be relatively straightforward to be a landlord for such units. It’s likely that growing tenants rights efforts will make it more challenging and less desirable to be a landlord, which could have the unfortunate effect of discouraging the development of in-fill housing.

Must read

1. Why does it take so long to implement missing middle housing reform? Here’s a plaintive cry from Sightline Institute’s Dan Bertolet, who reflects on the protracted struggle to actually implement “missing middle” housing policies, by re-legalizing duplexes, triplexes and fourplexes, as well as accessory dwelling units, in single family residential zones.  Policy analysts and political leaders have increasing come to realize that this kind of “gentle density” is a logical way to easy housing shortages and improve housing affordability, and many cities and leaders have pledged to get on with such policies. But the going has been extremely slow; as Bertolet points out, its taken Seattle nearly five years to get close to implementing its decision to allow secondary cottages (accessory dwelling units); a forthcoming to legalize duplexes and row-houses, by Bertolet’s calculations, may take another five years, meaning that it may finally be implemented nearly a decade after everyone agreed it was a good idea.

The underlying problem? There’s just so much resistance built into the city politics and the local land use planning process. It has historically been dominated by NIMBY factions, and is designed to move slowly, and change little. The solution, as Bertolet notes, is to have state governments intervene. They tend not to be as politically compromised as cities, and state mandates and overrides can also help break through the “prisoners dilemma” concerns that individual neighborhoods have that they alone will shoulder increases in density. Even with strong state prodding, its still going to take a lot of work to move missing middle forward.

2. Buff Brown on the soft bigotry of low expectations in city climate strategies. Bloomington, Illinois is in many ways a model liberal college town; it skews blue politically, and like many cities has adopted a sustainability plan and endorsed the Paris climate accords. But like a lot of cities, its biggest source of greenhouse gas emissions in transportation, and its losing ground. As transportation planner Buff Brown points out, the city’s vehicle miles traveled per capita have increased more than 11 percent in the past few years. And while the city recognizes it needs to lessen driving, and get more people transit, it’s actions don’t come close to measuring up to its rhetoric.  As Brown notes,

. . . the Action Plan has very weak goals with no math to tie them to the emission goals, and the lists of actions are orders of magnitude below what is necessary to meet these targets.

For example, the city’s goal is to increase transit ridership by 5 percent over the next six years, a gain of just 1 percent a year. This falls far short of what the city actually accomplished between 2002 and 2010, when transit ridership increased almost 9 percent per year.  And it also makes even more alarming the fact that the city has recorded a 6 percent decline in ridership in the past year. The city’s goal is at best a feeble one, far less ambitious than it actually managed in the past, and current performance is showing an decline that should be signaling a need for much bolder action.

At the same time transit ridership is declining, the city is moving forward with a plan to use local tax increment financing (TIF) monies to subsidize construction of a parking garage. The city is planning to spend $29 million in TIF funds to expand one parking garage by 200 spaces and build another with 379 spaces.  If cities are serious about climate change, this is plainly the wrong set of priorities.

3. Even down under, Induced demand. A new report from Australia confirms what science is showing worldwide:  building more highway capacity simply stimulates more driving, and does nothing to ease congestion. The report, commissioned by a Australian ride-hailing company Go-Get

City-dwelling Australians need to end their love affair with private cars and stop building new roads to beat congestion . . . building new roads or expanding existing infrastructure . . .  signals to drivers that commuting will be easier so more road users fill the newly created space, which is known as “induced demand”.

The solution for transportation problems is largely found in how we build our communities. Places that are dense, diverse and walkable enable people to meet many daily needs without car travel. And it turns out that these are exactly the kind of places for which there is robust demand.

“We find that communities that do have walkability, that have local cafes and amenities, they are the most in demand with consumers looking for a home, they have the highest house prices and demand.”

New Knowledge

It’s no accident: How we talk about crashes matters. Its commonplace for media reports of car crashes to describe them as “accidents,” and systematically downplay driver responsibility and instead blame victims.  If you wore dark clothing or were outside a market crosswalk, or it was dark, your injury or death is implicitly your fault.

A new study published by the Transportation Research Board, examines the way that common descriptions of traffic crashes affects reader perception of who’s responsible.  The authors presented subjects with three alternate text descriptions of a single car crash.  One version was pedestrian focused, a second version was driver focused and a third was driver focused and provided additional context about the frequency and location of car crashes. The key finding was the way in which the crash was described made a strong impact on reader’s decisions about who was to blame and policies ought to be pursued to reduce crashes and injuries.  A more complete and driver focused description of crashes led to more support, for example, for infrastructure solutions.

The author’s helpful have some succinct advise for reporters and editors; and its a grammar for talking about roadway deaths that all of us should embrace.  To translate one big of unfortunate academese: “non-agentive” ignoring humans and their choices, for example, don’t say “the pedestrian was struck by the car,” say “the driver ran over the pedestrian.”

  • Avoid non-agentive and object-based language.
  • Shift the focus away from the pedestrian and towards the driver (or if necessary, the vehicle).
  • Be conscious of the counterfactuals that you include. Specifically, if you mention that the pedestrian was outside a crosswalk, check Google Street View to quickly determine whether there are any crosswalks available and note that in many jurisdictions it is legal to cross outside marked crosswalks.
  • Include data on the number of crashes, injuries or deaths, preferably locally. Time permitting, consider contacting a local transportation, urban planning, or public health expert to provide further context.

Tara Goddard, Kelcie Ralph, Calvin G. Thigpen, Evan Iacobucci, “Does news coverage of traffic crashes affect perceived blame and preferred solutions? Evidence from an experiment,” Transportation Research Interdisciplinary Perspectives, 2019.

In the News

Willamette Week wrote about our commentary on the untrue claim that not proceeding with the $3 billion Columbia River Crossing will require Oregon and Washington to repay $140 million to the federal government, in an article entitled:  “One less reason to restart the Columbia River Crossing.”

The Oregonian featured our critique of this same claim about a federal repayment liability in its story discussing Governor Kate Brown and Governor Jay Inslee’s plan to revive the Columbia River Crossing project.


The Week Observed, November 15, 2019

What City Observatory did this week

1.  Copenhagen’s cycling success hinges on tax policy and pricing, not just bike lanes.  The New York Times offers up yet another postcard view of cycling in Copenhagen, where riding a bike to school or work is the most common mode of transportation.  The Times reports that this is because cycling is just “easier” and “more convenient” due to the city’s extensive networks of bike lanes.  That’s true, but leaves out an important part of the story.  In Copenhagen, new cars are heavily taxed (a 150% sales tax), and gasoline costs more than $6 per gallon.  In addition, parking is in short supply, and the city is raising the price of parking to further discourage car use.  It’s also critical to recognize that the city’s compact development pattern means more common destinations are close-at-hand, making cycling a viable means of transportation for daily trips. By all means, lets build more bike lanes; but getting a more balanced transportation system also depends critically on asking cars to pay something close to the full social, environmental, and economic costs they impose on all of us.

2. Carmaggedon is a no-show in Seattle once again. Earlier this year, when Seattle shut down its crumbling Alaskan Way viaduct, traffic experts widely predicted gridlock, expecting more than 90,000 cars to divert to city streets. That didn’t happen, and in fact traffic levels were subdued. The same predictions were made about the effects of turning on tolling on the new $3 billion SR 99 downtown tunnel (the roadway built to replace the viaduct). Traffic engineers predicted a third or more of tunnel users would divert to city streets, producing Carmaggedon. Once again, the predictions were wrong, at least as evidenced by Google Maps contemporaneous reporting of road conditions.

What Seattle’s experience shows–again–is that measures that reduce road capacity, or price roadways, actually reduce traffic levels. It’s the opposite of “induced demand”–reducing highway capacity in the city reduces the number of cars flowing onto city streets, and enables the transportation system to work better. The naive models that highway engineers peddle, implying that traffic is an inexorable, tidal force, are simply wrong. If you want less traffic and congestion, price roads and constrain highway capacity.

3. The city as a labor saving device.  Some of the most powerfully transformative technologies have been those that save human labor; indoor plumbing, washing machines, refrigerators, vacuum cleaners and the like have all reduced dramatically the amount of domestic work, and given us more leisure time. While we don’t think of cities as a “technology,” a dense, mixed-used urban neighborhood is actually a big time saver. With more common destinations (grocery stores, coffee shops, restaurants, and friends) close at hand, cities can be a big time saver. A big part of the demand for urban living comes from households looking to live in places that save them the one form of wealth you can’t get more of:  time.

The latest in labor-saving technology: a walkable city.

Must read

1. The limits of micro-transit. The problem with buses, rail lines, and other “fixed route” transit, is that unless you live at a station or bus-stop, and all your destinations are adjacent to stops, you have to walk to and from the place the transit serves. One regularly imagined solution to this problem is the idea of micro-transit:  small vehicles that would ply varying routes, picking up people at their homes or orgins in one area, and then ferrying them to a common destination (or destinations).  In theory, that ought to eliminate pesky walking, and given enough trip density (and computerized scheduling) it ought to be possible to pool multiple trips with a single vehicle. The trouble with that idea, though (as Human Transit’s Jarrett Walker has frequently pointed out, is that is inefficient and expensive.  For those who are looking for a succinct statement of what microtransit is (mostly) a dead-end, they have a new policy brief that makes that case.  Here’s a excerpt:

Picking people up at their doorstep involves traveling greater distances than operating service along a fixed route, and a microtransit driver in a van or car can carry far fewer people than the operator of a bus or train. For these reasons, microtransit typically costs agencies much, much more to run than an average bus route. And while subsidies for bus and train service fall as more people ride, microtransit is locked into a high-cost format that consumes more subsidies as usage increases.

2. Why more cyclists are dying. The National Transportation Safety Board has just reported the grim death tally for 2018: Some 857 cyclists were killed on the road, the highest number in decades. In the face of a roundly (and justifiably) criticized call by the NTSB to make helmets mandatory, Bicyclist has a thoughtful look at the reasons why cyclists deaths are increasing.  By identifying the causes of deaths, this analysis points to a more reasonable set of recommendations for reducing the toll. Chief among the causes: more people are driving more miles (we might add, due to cheaper gasoline), more drivers are distracted by technology like smart phones, and  more of the cars on the road are especially lethal trucks and truck-like SUVs. It’s also true that more people are cycling than in previous years, but it appears the “safety-in-numbers” effect of more regularly encountering cyclists has been more than offset by the other negatives. As a result, cities who only a short while ago adopted great-sounding goals around Vision Zero, have seen this particular metric going in the wrong direction.

3. New cars are for old people. Michael Sivak has an interesting analysis in the shift in the demographics of car buyers in the past decade.  Sales data show that new car buyers are proportionately older than ever. Sivak reports that 52 percent of all car buyers are 55 or older. Only 28 percent of car buyers are under age 45, down from 45 percent of all buyers just a decade ago. Much of this trend is driven by the overall aging of the population (millions more baby boomers are turning 65 every year), but much of it is evidence of the declining interest (and perhaps purchasing power) of young buyers.



New Knowledge

More evidence of the ineffectiveness of rent control.  Around Germany, municipalities have implemented new rent control regimes in the past few years, and the roll-out of the program has provided researchers with a natural experiment for testing the actual effects of rent control against the theoretical predictions. Three researchers, Andreas Mense, Claus Michelsen & Konstantin Cholodilin, gathered data on the offering rents for apartments in German cities.

As the authors relate, much as in the United States, the growing interest in urban living has fueled youth migration to cities, which has led to a shortage of housing and an increase in rents.  This was the proximate cause of legislation authorizing local rent caps.

. . . since 2010, urban agglomerations have become more attractive. Thanks to an inflow of migrants from smaller cities and from abroad, the population of large German cities began to expand quickly. The result was a housing shortage, particularly putting pressure on rents for new contracts

Like many rent control systems, the German approach regulates the rents of some units, but not others. One of the key findings of this study is that while units under rent control are less expensive, rents go up even more in the uncontrolled sector.  In addition, rent control isn’t “means tested” meaning that people can benefit from rent control regardless of income.  One of the theoretical predictions of economics is that rent control will tend to artificially discourage people from moving to a new home.

They find that:

. . . regulated rents decreased immediately after the rent cap became effective, while rents in the free-market segment increased after a lag of one to two months . . . an increase in free-market rents in response to rent control is a clear sign of misallocation of households to housing units . . . 

Rent control allows some households, which otherwise would have been unwilling to rent a unit in the market, to compete for rent-controlled units, thereby replacing other households with higher willingness to pay. The latter households move to the free-market segment and bid up the price there.

Mense, Andreas; Michelsen, Claus; Cholodilin, Konstantin. Rent control, market segmentation, and misallocation: Causal evidence from a large-scale policy intervention,  2019.  FAU Discussion Papers in Economics, No. 06/2019, Friedrich-Alexander- Universität Erlangen-Nürnberg, Institute for Economics, Erlangen


In the News

The New York Times quoted City Observatory’s report Less in Common in their article “Are my neighbor’s spying on me?”


The Week Observed, November 8, 2019

What City Observatory did this week

A two cent solution to climate change?  Around the world, plastic bags are an environmental scourge, both in the form a litter (a nuisance) and as a threat to wildlife. In response, many cities have implemented plastic bag fees, asking consumers to pay a nickel or more per bag. The result of such policies is dramatic:  In Britain, plastic bag consumption has fallen almost 90 percent. Our thought is that we apply the same idea to carbon pollution, asking people to pay about 2 cents per found of carbon that they emit.  That two cent a pound fee works out to about $40 a ton, which is in the range for what many economists are recommending as a way to fundamentally shift incentives in a way that would reduce greenhouse gas emissions.  If we’re willing to charge people a nickel for a plastic bag, why don’t we consider charging 2 cents a pound for carbon?


Must read

1. Why all the panic over gentrification? The premise of Matthew L. Schuerman’s new book “Newcomers” is that “gentrification is all around us.”  In his review at Washington Monthly, Wil Stancil asks whether gentrification is really as pervasive as Schuerman imagines:

As a demographic researcher, I decided to check. Using U.S. Census data, I looked at the share of people in New York, San Francisco, and Chicago living in places that met Schuerman’s definition of having gentrified between 2000 and 2016. In New York, it’s 3.1 percent of residents. In San Francisco, the number is 4.4 percent. In Chicago, it’s 4.8 percent.  . . . Using Newcomers’ own definition, the story of urban America is not a tidal wave of gentrification but creeping racial and economic transition. 

As City Observatory’s research, and that of others has regularly shown, concentrated poverty and neighborhood decline are far more widespread and far more devastating for the urban poor than the relatively few instances of gentrification.  But for author’s like Schuerman, who don’t dig deeply into the data, its unsurprising that their personal perceptions about gentrification hinge greatly on lived personal experience. It turns out that gentrification is all around “us,” if “us” is defined as well-educated, upwardly mobile, urban-leaning intellectuals.  As Stancil writes:

Almost by definition, it is members of the urban professional class who are the most likely to be exposed to affluent neighborhoods in the late stages of gentrifying. Among movers and shakers in media and politics, gentrification may truly seem to be everywhere they go. Often, it’s because they’re bringing it with them. 

Gentrification seems to be one of those subjects where personal anecdotes regularly trump careful data. We’d be much more likely to effectively address neighborhood change if the policy dialog were better grounded in facts.

2. How to talk about reforming housing policy.  Sightline’s Michael Andersen opens the hood on the right way to talk about changing housing policy. Earlier this year, Oregon passed pioneering legislation that legalizes duplexes, triplexes and fourplexes in single-family residential zones in the state. One key to this breaktrhough legislation was a conscious decision to talk about housing in different way than we have in the past.  The Sightline Institute prepared a guide to the rhetoric of housing reform that underscores the key messages. For starters, rather than talk about “density” and “housing units” Sightline urges advocates to adopt more meaningful and concrete terms that allude to specific kinds of homes, i.e. “re-legalizing duplexes.”  The umbrella term “Missing Middle Housing” helps communicate what they’re trying to achieve that puts it in a historical context and defuses some of the fears that added density can raise.  Sightline has published its full communication guide, and its a helpful resource for all housing advocates.

3. Uber’s car killed a pedestrian because it was programmed to ignore people outside crosswalks.  More than a year ago, Elaine Herzberg was struck and killed by an Uber autonomous vehicle in Arizona. The National Transportation Safety Board has been investigating the crash, and newly released documents show that Ubers sensors detected Herzberg several seconds before the crash, plenty of time to brake the car before striking her.  But the car’s software was programmed not to treat people outside of crosswalks as objects.  The cars software struggled to correctly categorize Herzberg, and by the time it alerted its on-board human supervisor of its confusion, it was too late to avert the crash. As Wired relates:

. . . despite the fact that the car detected Herzberg with more than enough time to stop, it was traveling at 43.5 mph when it struck her and threw her 75 feet. When the car first detected her presence, 5.6 seconds before impact, it classified her as a vehicle. Then it changed its mind to “other,” then to vehicle again, back to “other,” then to bicycle, then to “other” again, and finally back to bicycle.

It never guessed Herzberg was on foot for a simple, galling reason: Uber didn’t tell its car to look for pedestrians outside of crosswalks. “The system design did not include a consideration for jaywalking pedestrians,” the NTSB’s Vehicle Automation Report reads.

It appears that the software for autonomous vehicles is replicating the implicit bias of current road use conventions: and for pedestrians, that can have fatal consequences.

In the News

Willamette Week has a story reporting on the pushback climate advocates are offering to Portland’s proposed $3 billion, highway heavy transportation bond measure, slated to go before voters next year.  The article quotes City Observatory’s Joe Cortright on the climate implications of highway “improvements.”


The Week Observed, November 1, 2019

What City Observatory did this week

1. Tim Bartik explains business incentives. States and cities spend about $50 billion a year on tax breaks and other incentives to try to influence business location decisions.  The nation’s leading scholar on the subject, Upjohn Institute’s Tim Bartik, has a new book explaining succinctly and in non-technical terms about whether these incentives work and what can be done to make them work better. Bartik’s research shows that roughly three-quarters of time, incentives make no difference to business location choices–they’re simply wasteful. But its almost always impossible to convincingly argue that any individual deal is one of the three-quarters that are giveaways, and it’s very much in the interest of prospective recipients (and economic development agencies) to always argue that their incentives is making a difference. Ultimately, the reason incentive deals persist (and have grown to such huge proportions) is that the political calculus rewards deal-makers, who are seen as “doing something” to benefit the economy, while the costs are generally hidden and passed on to others. Because of this dynamic, we can’t expect incentives to go away, but Bartik has four concrete suggestions for policy makers looking to minimize the costs of incentives and maximize their benefits. You can buy printed copies of the book, or download a free PDF; either way, its a must read for anyone interested in economic development.

2. Portland’s regional government is push-polling a climate change denial message. Portland and Oregon have both fallen behind in their stated efforts to reduce greenhouse gas emissions, largely due to increases in driving. At the same time, the regional government is moving forward with a multi-billion dollar transportation funding measure. It commissioned some survey research, ostensibly to gauge public attitudes on the subject, but in practice, the survey is a thinly veiled effort to foist some phony choices and factually inaccurate claims on the public. The survey repeatedly claims that greenhouse gas emissions can be reduced by eliminating congestion so that cars don’t have to idle in traffic so much–a thesis that has been disproven. Actually, the opposite is the case: measures that speed traffic create induced demand, and the carbon emissions from more driving increase greenhouse gas pollution, rather than decreasing it. The purpose of the survey is plainly to develop the talking points and media campaign for selling a funding measure. It’s dishonest and reprehensible for a public body to disseminate a phony and misleading message about the causes, and solutions to the climate crisis. This is what climate change denial looks like.

3.  More evidence for the importance of talent to metropolitan economic success.  The Brookings Institution has a new report “Talent-Driven Economic Development:   A new vision and agenda for regional and state economies.” As the title suggests, the authors build the case for focusing on building skills and talent and outline the steps cities and states can take. Their research confirms the strong relationship between the educational attainment of the population and the productivity of the local economy.

It’s clear that working to increase the talent level of the local population is key, and the report describes a series of strategies for doing so, including more formal education (helping high school students reach college, and succeed once they’re there), and also helping and encouraging employers to provide additional training to their entire workforce (and not just those with the highest levels of skill, which tends to be the pattern). The sole caveat one might add to this report is the observation that talent is mobile, and well-educated workers tend to be gravitating to great urban locations. As a result, cities should look both to investments in increasing skills and talent, and also in building the kinds of great urban neighborhoods that will attract and retain talented workers.


Must read

1. Forget new technology, fixing transportation is about making the right choices. Henry Grabar has a perceptive essay at Slate debunking the fascination with technological solutions to our transportation problems, and emphasizing that how we build cities, and how we employ well-proven technologies like bikes, buses and elevators is really where the future lies. Hyperloops and autonomous vehicles get all the attention it seems, but miss the point that building walkable, human-scaled cities and neighborhoods rather than sprawling automobile-dominated ones is needed.

The tools we need to change transportation are right there in front of us. It’s not the lack of bleeding-edge technology that has stopped us from building cities where a person can live without owning a two-ton, $25,000 vehicle . . .  It’s not for want of “innovation” that we aren’t turning parking into parks, or traffic-clogged arterial roads like New York’s smoggy crosstown arteries into multimodal streets. It’s not the deferred promise of automation that stops us from charging people for the full, ice cap–melting cost of driving. The future of transportation is not about inventions. It’s about choices.

A big part of our problem is that we’re obsessed with movement, rather than with destinations. We treat transportation as an end in itself, rather than as a means of accessing people, opportunities and experiences. When we build systems to maximize speed and travel, we produce sprawling, automobile-scaled environments that are inimical to enjoying life. Just as the last great technology revolution (the automobile) only made things worse, newer iterations, like the autonomous vehicle and the hyperloop, will not overcome this essential problem. As Grabar writes:

A better world is possible, and it doesn’t start in the U.S. patent office or with what is on display at the Detroit Auto Show, the Paris Air Show, or the Consumer Electronics Show in Las Vegas. It won’t require supersonic travel tubes or cars that drive themselves. The ideas are here if we want them. We’ll have to rethink the trip, but even more than that, we’ll have to rethink the places we’re trying to connect.


2. Devin Bunten:  Housing affordability and gentrification. Writing at CityLab, economist Devin Bunten sets out to untangle the links between housing affordability and gentrification.  This is a thoughtful, and extremely well-written essay.  It makes many important and salient points in eloquent and persuasive fashion.  For example, Bunten writes:

Housing policies are designed to ensure that new neighborhood entrants are as rich or richer than those who arrived before them. The typical resident of multifamily housing in the U.S. earns half as much as the typical resident of a detached single-family home. A ban on apartments is a ban on these families. Within single-family-home neighborhoods, minimum lot sizes are wealth sieves.

While in some senses these problems are separable (affordability problems tend to be region-wide; gentrification is much more localized), it’s difficult to argue that they are un-related. Gentrification is a more severe and widespread problem in markets where housing shortages and affordability problems are most acute. In many cases, gentrification occurs when demand for high amenity housing can’t be met by building additional units in high amenity neighborhoods, chiefly because of zoning limitations and NIMBY opposition. Gentrification and housing affordability are both symptoms of our shortage of cities:  the growing demand for urban living is running headlong into serious constraints on building more housing in great urban neighborhoods. Gentrification and housing affordability may not be exactly the same problem, but an essential part of any solution to both problems is allowing for more housing to be built in cities.

3. How Los Angeles is planning to make its housing problems worse.  It’s well-established that Southern California’s housing affordability problems stem from the difficulty of building additional housing in the most desirable parts of the region. In theory, the state’s land use laws require the region to plan for enough space to accomodate housing demand, but there’s a hitch. The estimated regional total demand for new housing is allocated across different local jurisdictions under a process know and RHNA, the Regional Housing Needs Allocation.  The allocation is prepared by the Southern California Association of Governments, a confederation of cities and local agencies. The problem is that the allocations are skewed away from high demand locations. As Leonora Camner, writes in an Op-Ed in the Los Angeles Times, the allocations bear little relation to where housing is needed.

Beverly Hills, which has nearly twice as many jobs (57,000) as people (34,400), needs only 1,373 new units of housing. Meanwhile, the desert city of Coachella, with a population of 42,400 and 8,500 jobs, will be expected to build a whopping 15,154 units.

This matters because building more housing at the urban fringe, far from job centers, makes the region even more car-dependent, and locks in long commutes and high levels of greenhouse gas emissions. It may seem like a minor technocratic detail, but tweaking these planning estimates to allow for more new housing where its most needed is essential to addressing housing affordability, transportation challenges, and climate change.



Climate Change: A 2-cent solution

Let’s put a price on using the atmosphere as a garbage dump for carbon

It works for plastic bags; let’s use the same idea for carbon

Consider the plastic bag:  It’s a highly visible environmental problem, one that we all encounter.  Around the world, retailers routinely provide shoppers with “free” plastic bags to carry home their purchases.  The bags show up as refuse in municipal disposal systems (when they’re properly binned) and but are a major litter nuisance, and turn out to be a threat to wildlife.

For economists, the solution to the plastic bag problem is straightforward:  Charge consumers for taking them.  And in Britain, where this pricing policy has been in places for some time, the results are compelling. Large retailers in the UK are required to charge 5p (about 7 cents) for plastic bags. The fee has dramatically reduced plastic bag consumption, as the BBC reports:

Asda, Marks and Spencer, Morrisons, Sainsbury’s, the Co-op, Tesco and Waitrose sold 549 million single-use plastic bags in 2018-19, down from one billion in the previous year.

Since 2015, when a 5p charge was introduced to tackle plastic pollution, the number being used is down by 90%.

Customers now buy, on average, 10 bags a year compared to 140 bags in 2014.

Similarly Chicago has been charging shoppers a 7 cent fee for using disposable grocery bags. Rather than banning the bags outright, the city settled on the fee as a way to preserve consumer choice and yet encourage less use of the plastic bags. Those who don’t bring their own bags to the store pay a the 7 cent fee, which is itemized on their receipt; the grocer keeps 2 cents for their trouble, and the nickel per bag goes to the city.

If we’re willing to charge 7 cents for this, why not 2 cents per pound of carbon?


What if we did the same thing for carbon pollution?

The relative ease and simplicity of the bag fee got us thinking about how we might apply the same idea to another, somewhat more serious environmental problem: climate change. What would happen if we asked consumers to pay, say 2 cents per pound, for every pound of carbon that they emitted into the atmosphere? If consumers got some small signal that dumping carbon into the atmosphere wasn’t “free” then they’d have a strong incentive to change their behavior.

Of course, this actually isn’t a new idea. The world’s leading economists of every political stripe are in broad agreement that a carbon tax is a foundation for any effective climate change policy. But how we package it is important. Carbon tax advocates have always talked about pricing in “dollars per ton” but that puts it a little bit out of the reach of daily life and the average consumer. Talking about pounds of carbon makes it a little bit more comprehensible, and puts it in the same context as the plastic bag fee. Is it unreasonable to ask everyone to pay, for example,  just two cents for every pound of carbon they emit?

And two cents is pretty darn close to the correct number. While there are various recommendations for the appropriate level for a carbon tax, currently a number of experts are suggesting something like a tax of $40 to $80 per ton.  Divide that number by roughly 2,000 (we’ll just ignore whether the experts want that tax for a metric or an imperial ton) and a $40 per ton tax on carbon works out to about a 2 cents per pound tax.

Just to put that in perspective with our shopping bag, recognize that a typical polyethylene shopping bag weighs about five or six grams. So Chicago is charging consumers about 1 cent per gram for their shopping bag.  That’s roughly 200 times more than a 2 cent per pound tax on carbon (about 450 grams in a pound, so our 2 cents per pound tax works out to less than .005 cents per gram).

What does that mean in practice? Consider our most common form of carbon emissions: driving a gas-powered car.  If your car gets 20 miles per gallon, it produces about one pound of carbon per mile. There are slightly more than twenty pounds of carbon generated by burning a gallon of gas, so a five-mile round-trip to the store would generate about five pounds of carbon, which would cost you a dime with our proposed  2 cents per pound carbon fee. So in this scenario, if you’re buying two bags of groceries, your bag fee (in Chicago) would be 14 cents and your carbon emission fee would be 10 cents. Although if instead of driving your car, you rode your bike, and brought your own bags, you could save almost a quarter.

As a result, the fee we’re talking about to save the planet is not out of line with what we’re perfectly willing to ask consumers to pay to discourage the visible, but largely nuisance effects, of plastic bags.

A small fee, say 2 cents a pound on carbon would send consumers small, but pervasive signals about the effects of their buying choices and travel behavior on the environment. Sometimes–just as when you forget to bring your own bag, you might be willing to spend the 7 cents to have the convenience of a plastic bag, you pay for the privilege (and in the case of a carbon fee, generate revenue that could be used to reduce our dependence on fossil fuel, and offset the regressive effects of the tax). But overall, the fee would bias consumer (and investor) decisions in favor of all kinds of things that resulted in lower carbon emissions. It would make solar energy, and electric cars, and walkable urban places more economical, and make fossil fuel, gas-powered cars, and sprawl even less attractive than they are today. It would automatically reward businesses, inventors, and investors who came up with lower carbon ways to get all of the goods and services we value. It would gradually, but powerfully push us in the direction of lower carbon emissions and greater sustainability.

Shopping bags are a visible, annoying form of pollution. The are a regular feature of litter almost everywhere in the world. And while they’re a blight, and an unnecessary one, the fact is we’re willing (at least in Chicago) to make consumers pay a fee that reflects the environmental damage they cause, and to give a gentle nudge to their behavior in a direction that is better for the environment. And it’s working–plastic bag use in Chicago has dropped 42 percent in six months, and Britain reduced plastic bag use by nearly 90 percent over five years.

So why aren’t we willing to do the same with carbon? Perhaps its as simple as this: Carbon dioxide (the most common form of carbon pollution) is invisible.  We can’t see it.  If you’re car exuded fist-sized lumps of carbon at the rate of one per mile and they cluttered the roadway, we’d probably acknowledge the problem and agree to do this almost instantly. But the carbon evanesces into an invisible–and global–atmosphere, slowly, but surely raising global carbon levels and steadily raising the planet’s temperature. Plastic shopping bags aren’t an existential threat to the planet, so why are we willing to charge consumers 200 times as much (per pound) for these bags as we would charge for carbon emissions?

Is a couple of pennies a pound for carbon pollution too much to ask?




Carmaggedon does a no-show in Seattle, again

Once again, Carmaggedon doesn’t materialize; this time when Seattle started asking motorists to pay a portion of the cost of their new highway tunnel

Initial returns suggest that tolling reduced congestion by reducing the overall volume of traffic in downtown Seattle

The most favored mythology of traffic reporters and highway departments is the notion of traffic diversion:  If you restrict road capacity in any one location, then it will spill over to adjacent streets and create gridlock.  It’s invariably used as an argument against any plans to slow car movement or repurpose capacity for transit, cyclists or people walking.

Time and again, however, when road capacity is reduced, either by design or accident, the predicted gridlock fails to materialize.  The latest instance of this was just in the past month, when New York closed 14th Street to most car traffic; speeds on parallel streets 13th and 15th, were unaffected, according to traffic monitoring firm Inrix.

Crying Carmaggedon, again

The latest case study of comes from Seattle. Earlier this year, the city opened a new $3 billion tunnel under downtown Seattle, to replace the road capacity lost by the demolition of the city’s aging eyesore, the Alaskan Way viaduct.  Since it opened, the new SR 99 tunnel has been free to vehicles, but starting last Saturday, the state department of transportation started collecting tolls (electronically). What was free last Friday, now costs afternoon peak hour travelers between $2.25 (if they have a transponder) and $4.25 if they use the pay by mail option).  Even so, the toll revenues will ultimately cover only about 10 percent of the cost of constructing the tunnel.

The Washington State Department of Transportation (WSDOT), which operates the new SR 99 Tunnel, warned of severe traffic congestion, predicting that more than a third of the 70,000 vehicles that use the tunnel each day would divert to city surface streets.  Local TV Station KIRO warned motorists:

WSDOT projects around 35 percent of tunnel drivers will avoid tolls in the tunnel and jam downtown streets instead.

That’s pretty scary stuff.  How is Seattle’s latest brush with Carmaggedon turning out? Because Monday was Veterans Day, Tuesday, November 12, was the first regular business day in which the tolls were charged on the new tunnel.  So what happened?

Well, see if you can tell.  Here are the Google maps for traffic conditions in downtown Seattle on a typical Tuesday afternoon and for Tuesday, November 12, the first regular business day with tolling in place on the SR 99 tunnel.   On the left is Google’s map of actual traffic levels at 5:10 PM on Tuesday November 12, showing Google’s familiar color-coded congestion rankings (green is moving smoothly, yellow is slowing, red is stop and go). On the right is Google’s depiction of traffic conditions on a typical Tuesday at 5:10 PM.  You can spot one big difference right away.  The left-hand map shows the the tunnel as two parallel bright green lines; with tolls, traffic is moving smoothly in the tunnel.  But what about all the nearby side-streets in downtown Seattle?  Surely they’ll be overwhelmed by diverted traffic.  Actually, no.  Most of the streets leading to and near the tunnel show green, and traffic conditions in this area are actually better than on a typical Tuesday afternoon.


Source: Google Maps Traffic.

Overall, if you compare these two pictures, it’s pretty clear that today’s traffic situation in downtown Seattle is much better than a typical day.  Sure, Interstate 5, the freeway to the East of downtown Seattle is congested (as it is most late afternoon weekdays)  But downtown Seattle streets, particularly on the west side of downtown are “green.” or free flowing.  Overall, there’s a lot more “green” on Tuesday’s traffic charts than on a typical day. In other words:  no gridlock or Carmaggedon here.

Tolling the new SR 99 Tunnel didn’t make traffic worse.  If anything, it made traffic better.  The tunnel itself was flowing smoothly–it was green rather than red, meaning those paying the toll were getting value for their money.  Not only that, but it doesn’t appear that traffic on downtown streets in Seattle was any worse than on an ordinary Tuesday.  It’s likely that by reducing travel volumes on the tunnel, tolling reduced the number of cars driving onto downtown Seattle Streets.  Small reductions in travel demand that keep roads from crossing a tipping point and becoming congested make traffic move more smoothly.

If this gives you a bit of deja vu, dear reader, it should.  Back in January, just before the tunnel opened, the city had to commence demolition of the old viaduct, in order to connect on ramps to the new tunnel.  As a result, the city suddenly lost its old waterfront freeway, and didn’t have access to the new tunnel. State highway officials warned that the city was in for weeks of gridlock.  But when they closed the viaduct, not only did nothing happen, but as we related at City Observatory, traffic on most of downtown Seattle got better. Rather than simply diverting to other city streets, traffic levels went down; as the Seattle Times reported “traffic just disappeared.”

What road closures teach us about travel demand

So what’s going on here? Arguably, our mental model of traffic is just wrong. We tend to think of traffic volumes, and trip-making generally as inexorable forces of nature.  The diurnal flow of traffic on urban roadways seems just as regular and predictable as the tides.

What this misses is that there’s a deep behavioral basis to travel. Human beings will shift their behavior in response to changing circumstances. If road capacity is impaired or priced, many people can choose not to travel, change when they travel, change where they travel, or even change their mode of travel. The fact that Carmageddon almost never comes is powerful evidence of induced demand: people travel on roadways because the capacity is available for their trips, when when the capacity goes away or its price goes up, trip making changes to reduce traffic.

If we visualize travel demand as an fixed, irreducible quantity, it’s easy to imagine that there will be Carmaggedon when a major link of the transportation system goes away.  But in the face of changed transportation system, people change their behavior.  And while we tend to believe that most people have no choice and when and where they travel, the truth is many people do, and that they respond quickly to changes in the transportation system and to road pricing.  Its a corollary of induced demand:  when we build new capacity in urban roadways, traffic grows quickly to fill it, resulting in more travel and continuing traffic jams. What we have here is “reduced demand”–when we cut the supply of urban road space, traffic volumes fall.

If Seattle drivers quickly change their behavior in response to a dollar or two of tolls, that’s a powerful indication that more modest steps to price roads don’t really mean the end of the world. If we recognize that, in the absence of pricing, traffic will tend to adjust to available capacity, we then end up taking a different view of how to balance transportation against other objectives. For example, this ought to be a signal that road diets, which have been shown to greatly improve safety and encourage walking and cycling, don’t have anything approaching the kinds of adverse effects on travel that highway engineers usually predict.

There’s one other fiscal codicil to this tale.  The tolls that drivers pay to use the new $3 billion tunnel cover barely 10 percent of the costs of construction.  The fact that tolls reduce traffic by a third (or more) show that a good fraction of tunnel users are don’t value the tunnel at even a tenth of the cost of providing its right of way; and that they’ll use it only if its free.  That’s a pretty solid indication that this “investment” has negligible value.  In addition, the fact that implementing pricing has caused traffic conditions in much of downtown Seattle to improve is an indication that simply charging a modest price for roadways actually produces net benefits for road users–it encourages those with choices to travel at other times or avoid congested areas, producing better service for everyone.  And that may be the real lesson here:  the tunnel didn’t make traffic in downtown Seattle better, the toll did.

Carmaggedon never comes

Of course, we’ll wait for detailed data on traffic conditions that will be collected over the next few weeks before making a definitive judgment.  But this phenomenon of reduced demand is so common and well-documented that it is simply unremarkable.  Whether it was Los Angeles closing a major section of freeway to replace overpasses, or Atlanta’s I-85 freeway collapse, or the I-35 bridge failure in Minneapolis, or the demolition of San Francisco’s Embarcadero Freeway, we’ve seen that time and again when freeway capacity is abruptly reduced, traffic levels fall as well. There’s a lesson here, if we’re willing to learn it:  if you want to reduce traffic congestion, reduce traffic levels. Whether you do it by restricting capacity, or (more sensibly) by imposing tolls that ask motorist to pay for even a fraction of the cost of the roads they’re using, you get a much more efficient system.





Copenhagen’s cycling success: Make cars pay their way, not just bike lanes

Promoting biking requires ending the big, hidden subsidies to car ownership and use

It easy to be in love with cycling in Copenhagen.  Bikes are the mode of transport most favored for trips to work and school by local residents.  American’s traveling to the Danish capital are always blown away by how well the system works, and how many people of all ages and demographic groups cycle daily.

The latest journalist smitten by Copenhagen’s two-wheel miracle is the The New York Times’ Peter Goodman, whose article is entitled “The City That Cycles With the Young, the Old, the Busy and the Dead–Nearly half of all journeys to school and work in Copenhagen take place on bicycles. And people like it that way.”  Goodman relates stories of typical Copenhageners, from mothers with young children, to professionals, to the elderly and small business people, who routinely use the city’s network of bike lanes as their preferred mode of transportation. Touristic observation suggests a simple “build bike lanes and they will cycle” theory of change.

But there’s more to the story than that. Bike lanes–and a culture of acceptance and encouragement for cycling–are vital, but there are a whole range of other policies, especially the way car ownership and use are priced, that support cycling.  Copenhagen is a paragon and a parable of how to build a cycling city, but the narrative that talks only about bike lanes, and doesn’t talk about taxing cars and fuel, pricing parking, and building dense multi-family housing, is leaving out some essential parts of the story.

She's in the majority. (Flickr: Colville-Anderson)
Tax policy is tipped in favor of this mode of transport. (Flickr: Colville-Andersen)

Like other journalists, Goodman credits Copenhagen’s success to a the construction of separated bike lanes.  He writes:

The city focused on making biking safe and comfortable, setting lanes apart from cars on every street. As biking captured mass interest, improving the infrastructure became good politics. When it snows in Copenhagen, bike lanes are typically plowed first.

To be sure, the city’s infrastructure is impressive: Copenhagen has on-street bike lanes, dedicated bike boulevards, and even bike- and pedestrian-only bridges.  Cycling has achieved social and cultural critical mass.  People of all ages, different genders and social stations ride their bikes: cycling is not the exclusive province of the athletic, the young and the spandex-clad. And most everyone rides some variant of the simple, upright single-speed black city-bike.  As an occasional visitor to the city, its a joy to rent a bicycle and use it as your primary means of transportation.

Goodman reports:

Copenhagen’s legendary bicycle setup has been propelled by all of these aspirations, but the critical element is the simplest: People here eagerly use their bicycles — in any weather, carrying the young, the infirm, the elderly and the dead — because it is typically the easiest way to get around.

For those who have made the pilgrimage to Copenhagen, and come away with a romantic vision of re-making their auto-dominated city into a more bike-friendly place, there’s a lot than can be learned.  While leadership and infrastructure are certainly keys to building a bike-friendly city, Goodman’s article–and too many re-tellings of Copenhagen’s success–leave out some of the most important ingredients.  Critical among these are the taxation and pricing of cars and motor vehicles, and the density and ownership of housing.

The reason that cycling is “more convenient” and is the easiest way to get around is that Copenhagen has done away with the subsidies to cars that pervade U.S. cities.  It heavily taxes vehicle purchases and also taxes gasoline.  Parking is scarce and expensive, and the city is even now raising the price of parking to further discourage car use.  It’s surprising that Goodman–the Times’ former national economic correspondent, leaves out the most pertinent economic details that tip the balance in favor of cycling.

Like most Western European nations, Denmark imposes heavy taxes on gasoline.  The typical price of a liter of gas in Denmark today is about 11.11 Danish Kronor (DKK), which works out to almost $6 per gallon .  Because of higher taxes, gasoline costs roughly twice as much in Denmark as it does in the US. Cheap gasoline is a strong inducement to own and drive cars.  Expensive gasoline prompts people to make very different choices, both about where to live and how to travel. (Plus the tax revenue is a vital source of funding for bike infrastructure, transit, and a range of public services).

Also, Denmark imposes a 150 percent excise tax on most new vehicle purchases.  So a basic economy car which would have a retail price of say $20,000 in the US would cost upwards of $50,000 in Denmark.  (The tax has been reduced from a previous level of 180 percent).  Unsurprisingly, only about 29 percent of Copenhagen households own cars.  Making cars and driving more expensive creates powerful incentives for people to live in places where there are good alternatives to car travel (including transit, walking and cycling), and to utilize these modes regularly.

Finally, its worth noting that the density and ownership of housing in Copenhagen is very different than in US cities.  Copenhagen is relatively dense.  Nearly 60 percent of households live in multi-family housing.  Also, Denmark has a system of tenant-governed social housing.  About 20 percent of the nation’s population lives in social housing that is constructed and governed by tenant cooperatives.  Cycling is more convenient in higher density communities, because so many more destinations are close-by within cycling distance. Charging the right price for cars, fuel and parking helps encourage more compact patterns of development that are essential to assuring that cycling is a preferable option to driving.

There’s a lot we can learn from the design and operation of bike lanes in Copenhagen, and the lessons about leadership and the need to make investment are real.  But that’s only part of the story.  Public policies that ask car owners to take greater responsibility for the cost of roads and emissions, and the conscious decision to build housing at much higher densities make cycling more attractive and feasible than car travel for many trips.  As we always stress at City Observatory, the dysfunction in our transportation system stems fundamentally from charging the wrong price for roads. Stories, like this one from the Guardian, extolling the Copenhagen cycling success story shouldn’t leave out the essential role of correctly pricing cars and fuel and building dense housing.

Why Cyber-Monday doesn’t mean delivery gridlock Tuesday?

Far from increasing traffic congestion, more on-line shopping reduces it, by reducing personal shopping trips

Delivery trucks generate 30 times less travel than people traveling to stores to make the same purchases

The more deliveries they make, the more efficient delivery services become

December first is famously “Cyber-Monday,” the day on which the nation’s consumers take to their web-browsers and started clicking for holiday shopping in earnest. Last year, its is estimated that online shoppers orders more than $3 billion worth of merchandise on this single day, and the expectation is this will grow even further this year.

The steady growth of e-commerce has many people worrying that urban streets will be overwhelmed by UPS and Fedex delivery trucks ferrying cardboard boxes from warehouses to homes.  One of these jeremiads was published by Quartz:  “Our Amazon addiction is clogging up our cities—and bikes might be the best solution.”  Benjamin Reider notes–correctly–that UPS and other are delivering an increasing volume of packages, and asserts–without any actual data–that truck deliveries are responsible for growing urban traffic congestion.

While there’s no question that it’s really irritating when there’s a UPS truck doubled-parked in front of you–it’s actually the case that on-balance, online shopping reduces traffic congestion.  The simple reason:  Online shopping reduces the number of car trips to stores.  Shoppers who buy online aren’t driving to stores, so more packages delivered by UPS and Fedex and the USPS mean fewer cars on the road to the mall and local stores. And here’s the bonus: this trend benefits from increased scale.  The more packages these companies deliver, the greater their deliver density–meaning that they travel fewer miles per package. So if we look at the whole picture, shifting to e-commerce actually reduces congestion.

Delivering packages and reducing urban traffic congestion! Credit: Jason Lawrence, Flickr
Delivering packages and reducing urban traffic congestion! Credit: Jason Lawrence, Flickr

The rise of e-commerce and attendant residential deliveries has led to predictions that urban streets will be choked to gridlock by delivery trucks. A recent article in Forbes predicted that package deliveries would triple in a few years, adding to growing traffic congestion in cities around the world.

In our view, such fears are wildly overblown.  If anything they have the relationship between urban traffic patterns and e-commerce exactly backwards.  The evidence to date suggests that not only has the growth of e-commerce done nothing to fuel more urban truck trips, but on net, e-commerce coupled with package delivery is actually reducing total urban VMT and traffic congestion, as it cuts into the number and length of shopping trips that people take in urban areas. The first point is that, despite the rapid growth of e-commerce, truck traffic has been essentially flat.

Shopping on line substitutes for personal shopping trips and actually reduces traffic congestion

It actually seems like that increased deliveries will reduce urban traffic congestion, for two reasons.  First, in many cases, ordering on line substitutes for shopping trips.  Customers who get goods delivered at home forego personal car shopping trips.  And because the typical UPS delivery truck makes 120 or so deliveries a day, each delivery truck may be responsible for dozens of fewer car-based shopping trips.  At least one study suggests that the shift to e-commerce may reduce total VMT and carbon emissions.  And transportation scholars have noted a significant decrease in shopping trips and time spent shopping.

There are already signs that e-commerce is reducing the amount of travel associated with shopping.  The National Household Travel Survey, conducted in 2009 and 2017, shows a decrease in travel-related shopping.  The US Department of Transportation concludes:

In 2017 people made fewer everyday trips than previously. The decline in travel for shopping and running errands was primarily due to the increase in online shopping and home deliveries.

The decline in vehicle miles traveled per person per day was greatest for younger adults–the group that reports the most frequent use of on-line shopping.  On-line shopping creates some travel for delivery, but reduces the number of consumer shopping trips.  And there are vastly more consumers than delivery trucks; and each delivery truck makes many deliveries.  Professor William Wheaton of MIT estimates that $100 spent on line generates about eight-tenths of a mile of vehicle travel for UPS delivery trucks; while the same amount of consumer spending at brick and mortar retailers generates about 28 miles of vehicle travel.  This means that on-line shopping produces 30 times less vehicle travel than personal shopping.

Source: William Wheaton, MIT Center for Real Estate, 2019.

The more deliveries, the more efficient they become

But there’s a second reason to welcome–and not fear–an expansion of e-commerce from a transportation perspective.  The efficiency of urban trucks is driven by “delivery density”–basically how closely spaced are each of a truck’s stops.  One of the industry’s key efficiency metrics is “stops per mile.”  The more stops per mile, according to the Institute for Supply Management, the greater the efficiency and the lower the cost of delivery.  As delivery volumes increase, delivery becomes progressively more efficient.  In the last several years, thanks to increased volumes — coupled with computerized routing algorithms — UPS has increased its number of stops per mile–stops increased by 3.6 percent but miles traveled increased by only about half as much, 1.9 percent.  UPS estimates that higher stops per mile saved an estimated 20 million vehicle miles of travel.  Or consider the experience of the U.S. Postal Service:  since 2008, its increased the number of packages it delivers by 700 million per year (up 21 percent) while its delivery fleet has decreased by 10,000 vehicles (about 5 percent).

As e-commerce and delivery volumes grow, stop density will increase and freight transport will become more efficient.  Because Jet.com is a rival internet shopping site to Amazon.com, and not a trucking company, its growth means more packages and greater delivery density for UPS and Fedex, not another rival delivery service putting trucks on the street.

So, far from putative cause of worry about transportation system capacity–and inevitably, a stalking horse for highway expansion projects in urban areas–the growth of e-commerce should be seen as another force that is likely to reduce total vehicle miles of travel, both by households (as they substitute on-line shopping for car travel) and as greater delivery density improves the efficiency of urban freight delivery. A study of the shopping and travel habits in the United Kingdom showed that those who used on-line shopping reduced the total number of shopping trips that they took, suggesting that package delivery stops substitute for personal shopping trips. The study concludes:

Crucially, having shopped online since the last shopping trip significantly reduces the likelihood of a physical shopping trip.

As David Levinson reports, data from detailed metropolitan level travel surveys and the national American Time Use Study show that time spent shopping  has declined by about a third in the past decade.    As Levinson concludes “. . . our 20th century retail infrastructure and supporting transportation system of roads and parking is overbuilt for the 21st century last-mile delivery problems in an era with growing internet shopping.”

So the next time you see one of those white or brown package delivery trucks, think about how many car based shopping trips its taking off the road.



William Wheaton, The IT-Energy Transportation Revolution: Implications for Urban Form

Department of Economics, Center for Real Estate, MIT May, 2019