As the Regional Transportation District’s FasTracks program begins to materialize, RTD is colluding with several Denver-area urban renewal entities to redevelop areas around new and existing light rail stations. Taxpayers and property owners should beware.
Eminent domain enables governments and agencies to take land for public use. In recent years, private property rights have been undermined by the corruption of the term “public use” to include private redevelopment when that property could serve a perceived public benefit.
Public benefit is a flexible concept often interpreted to mean an increase in tax revenues in a redeveloped area.
Urban renewal aims to rid a neighborhood of “blight” (some states refer to the condition as “slum”). An examination of the Colorado Revised Statutes reveals that new Transit-Oriented Developments (TODs) and other urban renewal projects may themselves be blighted areas, according to state law.
To be “blighted,” an area must meet five of 11 provisions outlined by statute. The conditions that must be present include a predominance of defective or inadequate street layout; faulty lot layout in relation to size, adequacy, accessibility or usefulness; or the existence of conditions that endanger life or property, by fire or other causes.
In addition, statutory blight includes environmental contamination of buildings or property; the existence of health, safety, or welfare factors requiring high levels of municipal services or substantial physical underutilization or vacancy of sites, buildings, or other improvements; and any condition that impairs sound growth of municipality, retards the provisions of housing accommodations, or constitutes an economic or social liability.
Most of the proposed areas of TOD include plans for high-density living spaces and retail shopping spaces. Despite construction of these developments around light rail transit, the number of cars will increase on those redeveloped streets and on nearby arteries, as people drive to and park near the stations, and residents move in and park their own cars. Environmental contamination as a result will include diminished views, significant noise pollution and higher commuter traffic pollution.
These new developments also put a great strain on police and fire services. Redeveloped areas increase the burden on service districts, but decrease the funding for those services, as many of these projects rely on highly flawed subsidy-based funding mechanisms like tax-increment financing. This creates an alarming public safety concern since most of the housing will be high- and medium-density.
In troubled economic times, retail vacancy rates (and residential vacancies) are high, constituting an underutilization of these spaces. High vacancy places developers, owners and tenants under pressure. Underutilization is dangerous because of the lost tax revenue necessary to fund services to the project areas, if those owners and their tenants cannot keep up with the tax burden. Underutilization constitutes an economic liability, which impairs the healthy, organic and market-driven growth of a municipality.
For all of these reasons, TODs should be recognized as blighted areas. RTD, local governments, and especially citizens, would be wise to reexamine urban renewal plans, especially government subsidized urban renewal based on unjust eminent domain practices, to determine how best to improve blighted sights, and to ensure that redevelopment decreases, rather than increases, blight.
When TODs attract businesses and residents, traffic, congestion, noise, protection burden and blight will increase. If they don’t attract new tenants, these areas will fail economically and need to be “redeveloped” again in a few more years. Citizens should be on their guard to ensure that massive taxpayer subsidies to TODs do not create more blight than previously existed.
Chris Asmus is a research associate as the Independence Institute.