David Thompson Presentation - Built Environment Forum January 2011

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David Thompson, Director, Sustainable Communities presents at the Built Environment Forum.

David Thompson, Director, Sustainable Communities presents at the Built Environment Forum.

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  • 1. Opponent or Ally?Prices, Policy and a Healthy Urban Form Built Environment Forum Lister Hall, University of Alberta David Thompson Director, Sustainable Communities Sustainable Prosperity www.sustainableprosperity.ca January 18, 2011
  • 2. Overview• Impacts of sprawl• Traditional policy tools for addressing sprawl• Successful?• Why?• Transforming an opponent to an ally Making markets work for the environment 2
  • 3. Health-related impacts of sprawl• Sprawl associated with at >4 categories of population health risks (AHS, 2009): • Physical inactivity, reduced air quality, increased vehicle collisions, mental health issues• Example outcomes (Johnson and Marko, 2007): • Heart disease, diabetes, colon cancer, osteoporosis, respiratory disorders, heart disease, cancers, fatal injuries, other injuries, mental health issues• More impacts: Bray, Vakil and Elliott, 2005 Making markets work for the environment 3
  • 4. Other impacts of sprawl• Eats up farmland• Hollows out established neighbourhoods• Locks in automobile dependency• Makes transit less feasible• End of cheap oil = homeowner financial risks• Legacy costs: infrastructure maintenance, policing, EMS, repair and replacement Making markets work for the environment 4
  • 5. Traditional policy tools• Land use planning• Transportation priorities – active > transit > car• Bylaw changes – allow mixed use• Popular education• Etc Making markets work for the environment 5
  • 6. Successful?• Known about the problems for decades• Had the tools for even longer• Yet what is our current development pattern? – E.g. Edmonton MDP – 75% sprawl Making markets work for the environment 6
  • 7. What are the actual causes?• Consider “Home X” – 3 BR, 2 bath, 1600 sq. ft., finished bsmt• Two location options: – Established neighbourhood near centre of town – Edge of town• Neighbourhoods are different – amenities, community, schools, access to town, etc.• Another difference? Making markets work for the environment 7
  • 8. The elephant in the room: prices• Price is a major influence on decisions• For individuals & firms, homebuyers & developers• Can “urge” infill, provide public education, create targets for downtown development• But if sprawl cheaper, what will happen?• Organic produce vs. regular produce?• Bullfrog electricity vs. regular electricity? Making markets work for the environment 8
  • 9. Environmental Pricing Reform (EPR)• A response to environmental problems – Nobody wants problems; no ‘bad guys’ – Current set of incentives creates problems• Response: change the incentives – Align financial incentives with environmental goals – “Tax bads, not goods” – We do it already: RRSPs, tobacco taxes…• Outcomes – environment, economy, jobs, revenue diversification, etc. Making markets work for the environment 9
  • 10. Adjusting which prices?• Many possible candidates relevant to sprawl• Three examples: – Development cost charges – Property taxes – Transportation costs Making markets work for the environment 10
  • 11. Development cost charges• Development entails costs for a city – E.g. roads, facilities, policing, libraries, etc. – Costs vary depending on location• DCCs: charges on development to help pay costs• Edmonton DCCs: many are flat – Per square foot / per dwelling / per-hectare / etc.• Can be done differently – Make charges vary by location, as costs do Making markets work for the environment 11
  • 12. DCCs to encourage infill, density Making markets work for the environment 12
  • 13. Property Taxes• Central vs. suburban – Edmonton: property taxes based on total property value – Land cheaper at fringes, so taxes are lower – Change: reduce taxes at center, raise at fringe• Density – Edmonton: multi-family tax rate 15% higher than single fam. – Change: give denser properties tax advantage Making markets work for the environment 13
  • 14. Transportation pricing• Road pricing – Remove road subsidy, examples worldwide• Parking pricing – Parking stall fee: level playing field - centre & fringe• Vehicle registration – Feebates, PAYD• Free transit downtown – E.g. Calgary Making markets work for the environment 14
  • 15. Politics Making markets work for the environment 15
  • 16. Conclusions• General principle: get root causes of problems – Or else they will persist• Often root cause is pricing incentives• Get prices on-side, not against our goals• Do we want to achieve sustainability goals? – Prices can be powerful ally – Prices can be powerful opponent – Which do we want? Making markets work for the environment 16
  • 17. References• Alberta Health Services, “Urban Sprawl and Health” (April 2009) http://www.albertahealthservices.ca/poph/hi-poph-hpp-info-urban-sprawl.pdf• Johnson and Marko, “Designing healthy places: Land use planning and public health” (Capital Health, 2007) http://www.capitalhealth.ca/NR/rdonlyres/eh4qelt76mejjmxogexsmbh5qrs32flyyiknqr3z6jn6 xcfgyjqbeqpip3xrsztvr27joqqj2bd2pyr7myh74cnflib/DesigningHealthyPlaceslandusePublicatio n.pdf.• More: Bray, Vakil, Elliott, “Report on Public Health and Urban Sprawl in Ontario – a Review of the Pertinant Literature” (Ont College of Family Physicians, Jan 2005) http://www.ocfp.on.ca/local/files/Communications/Current%20Issues/Urban%20Sprawl-Jan- 05.pdf• Thompson and Bevan, “Smart Budget Toolkit: Environmental Pricing Reform for Municipalities” (Sustainable Prosperity, 2010) http://www.sustainableprosperity.ca/article172.• Thompson, “The Power of Prices and the Failure of Markets: Addressing Edmonton’s Environmental and Fiscal Challenges” (City of Edmonton, June 2010). http://www.edmonton.ca/city_government/documents/Discussion_Paper_17_Power_of_Pri ces_and_Failure_of_Markets.pdf Making markets work for the environment 17
  • 18. David ThompsonDirector, Sustainable CommunitiesSustainable Prosperitydthompson@plrc.cawww.sustainableprosperity.ca Making markets work for the environment 18