Given that I’m not only a certified city planner but also was paid at one point to write parts of similar documents (no, you didn’t read them, no one did), I thought I ought to do Room 8 readers the favor of actually reading through PlanNYC2030, a document whose public discussion has thus far been limited to congestion pricing. This plan follows the similar 1969 Plan for New York City and the 1987 New York Ascendant, each of which was issued at the peak of an economic boom, each of which promised extensive public and publicly-subsidized improvements for city residents, and each of which was immediately followed by a fiscal crisis. I therefore have strong doubts about the value of grand plans, especially those identified for “further study,” and PlanNYC has many of those – often those with a particular group of planning ideologues in favor (I recognize their footprints from the past) who received a tip of the hat here. And then there is the unsaid – which I will try to fill in. The plan, however, also has many real proposals, many good proposals, which I will discuss in other posts. In the end, however, New York in 2030 will come down to something I have come to think about more and more over the years. Money.
The plan assumes that the city’s population will continue to grow, reaching 9 million by 2030. Its purpose is to find a way to accommodate those newcomers without overtaxing infrastructure and public facilities and diminishing the quality of life for existing residents. This represents quite a change from past planning efforts, which had to make the case to a skeptical and hostile audience that New York City would not be gradually abandoned. As late as the mid-1990s, federal transportation officials objected to the assumption that Manhattan would continue to be a dense, vibrant, central business district, and to ongoing investment in transit based on that assumption.
In addition to assuming population growth, the plan also assumes the city will have the money to invest in improved public services, particularly in the infrastructure, public amenity and environmental categories. According to its introductory section “this (employment) growth will also result in enormous revenues. The expansion of our tax base will impact our economy accordingly. The additional jobs, tourists and residents could generate an additional $13 billion annually – money that can be used to help fund some of the initiatives described in the following pages and to provide the services that our residents, businesses, workers and visitors deserve.”
But I have doubts about both the population growth and the fiscal future assumed in the plan.
Adding housing to New York City is far more expensive than adding it elsewhere in the country. Because the city is already built at a high density, new construction involves small projects on constricted lots that must also absorb the cost of displacing whatever is already there. Whenever the city’s economy gets strong, as it has been recently, the cost of residential and commercial space – and land on which to build more such space – soars. According the Plan, the cost of development sites per buildable square foot has soared to $100. Meaning a 1,000-square-foot family-sized apartment has already cost $100,000 before one even begins to build it – double the city’s median family income in 2005. Eventually, as housing and commercial real estate prices rise, the cost becomes so prohibitive that people and businesses go elsewhere, limiting population and job growth. (The flipside is that if New York’s economy and population decline, cheaper space draws people and businesses in, limiting that decline).
The plan proposes bringing land costs down by increasing zoning capacity through upzonings, giving a better chance of negotiating with site owners. That is probably a good idea – there is no reason, for example, that the upzoning of Brooklyn’s Fourth Avenue and donwzoning of its side streets was stopped first at 9th Street and then at the Prospect Expressway rather than being extended all the way to 65th Street. Even if done on a larger scale that the city’s political process is likely to accept, however, upzonings will only have a marginal effect on land prices in a city this size, and taller buildings require a higher construction cost in any event. This will limit unsubsidized new construction to the better off, and its extent to the number of better off people the city can attract. The Plan proposes an increase in subsidized construction using inclusionary housing bonuses, but it remains to be seen if the imposition of greater requirements will drive land prices down enough for development to proceed. And construction of decks over highways and rail yards, while feasible, would also vastly increase the cost of the space produced, limiting occupancy to the affluent and the fortunate (possibly well connected) recipients of deep subsidies.
So housing expansion requires an increasingly affluent population willing to pay vastly more than elsewhere to be in New York City – not just in Manhattan but the other boroughs as well. An increasingly affluent population, however, also limits population growth, since better off people will demand more space per person. In Windsor Terrace where I live, for example, many two-family homes have been converted to one-family homes – offsetting a new construction boom that has filled just about every available site over the past decade. Since New Yorkers already use space more intensively than other Americans, any housing expansion may be absorbed by “qualitative growth” as people spread out. With people living longer, moreover, there will be more housing units occupied by empty nesters and fewer by parents with children. The effect of these trends? New York City had about the same number of people in 2000 as it 1950, but it had vastly more housing units in the latter year. Cities that remained economically vital but did not add as many housing units, such as Boston and San Francisco, lost population.
In summary, the city’s population is more likely to be relatively stable than to boom or, now that the ghost of the 1970s has been exorcized, shrink. There may be some small gains, but large population gains are unlikely. The re-expansion of urban American will have to occur the way the expansion of suburban America has – with the revitalization of additional older cities (such as, for example, nearby Philadelphia) and the creation of new places with the same characteristics. The population boom projected in this plan would require the housing bubble to continue indefinitely. It won’t.
New York’s public fiscal realities are more daunting, and despite’s the plan’s claim to break with past practice by identifying funding sources, it doesn’t really change them. New York City has both high taxes and extensive unmet needs for its existing population, let alone an additional one million people. The plans talks of adding parks, yet garbage overflows in the trash cans of those we already have, some of which have had dense brush planted to cut down their size and thus their maintenance costs. Libraries are open less here than just about anywhere. Street conditions are deteriorating because, in these good times, they aren’t being re-paved as fast as in needed to maintain their condition. The plan talks of more trees, but the city’s tree pruning schedule has been insufficient to maintain their health and our safety. (In my neighborhood, however, it seems all the streets are being done over and trees pruned this year). Then there are the long-term needs for ongoing normal replacement in the transit system, something that has been disguised by having the MTA go deeper and deeper into debt rather than paying as it goes. Merely to maintain the city’s existing facilities would require more of a commitment to ongoing operations, a commitment that is planned for the future but has not been made to date.
And what about the schools, a subject excluded from PLANYC? One might argue that their needs are being addressed elsewhere, but their physical needs don’t seem to be. Those schools are now overcrowded with enrollment at about one million. If in a city of eight million the average person lives to age 80, that implies 100,000 people at each age and 1.4 million children from pre-K to high school (assuming everyone finishes on time). And in fact, according to DOE planning documents, the city now averages a stabilized 115,000 births per year. If, as the Plan proposes, the city’s population were to rise to 9 million, the stabilized school age population would be 1.6 million.
Of course the city has far fewer than 1.4 million children in the city’s public schools with its existing population. That is because the poor quality of those schools drives many parents to the suburbs, or to pay for private and parochial schools themselves despite paying taxes as well, and only half of the city’s children graduate from high school in four years. The city’s plan for school seats assumes that, to an extent, all these enrollment-limiting factors will continue. This despite the ongoing collapse of a parochial school system squeezed between inadequate teacher pay and the inability of parents to afford tuition (and the unwillingness of government to give parochial s school parents some of the benefit of their own tax payments), the increasing interest of two-job couples with children in living close to their workplace so they actually get to see their kids part of the day, and an assumption that the schools will improve. Moreover, alternatives means of accommodating children within the existing square footage – from year-round schooling to at-home schooling to double-shifts – seem to be off the table.
Schools, like jobs (another user of the city’s scarce land) are excluded from the PlanNYC discussion of how that land should be allocated. Except for the possibility of “underused schools” being used not for new schools which can attract children from overburdened areas, but for housing, and the re-use of low density industrial areas not for other non-residential uses but also for housing. Housing has been pushed to the forefront whenever other land uses shrink, both by current bubble prices and, in PLANYC2030, by policy. For example, the findings of the hospital closing commission were immediately followed by a discussion of condo (not school) possibilities for disused hospital sites. And what is the likely use of the Pfizer site in East Williamsburg, a site with sufficient transit access to serve as a location for high schools serving overflowing areas throughout Brooklyn and Queens? Condos.
Implicit in the plan’s assumption of a fiscal cornucopia is an assumption that the city will continue to attract fiscal cash cows – those who pay far more in taxes than they require in public services – while the population of net fiscal drains stays the same or diminishes. The cash cows include young working singles and couples, working empty nesters in good health, in-commuters, tourists, and businesses. In addition to public safety (police, fire), these require public streets and parks, water and sewerage, electricity and other power sources, mass transit, cultural amenities and a quality general environment – the very subjects covered by the Plan, the very things – along with schools – the City of New York has less of and has spent less on for 30 years. The public cost of such infrastructure and amenities is far less than these groups pay in taxes. The plan gives the needs of these net contributors – the vast majority — and the future, some long deferred and much deserved attention. The Mayor, however, has shown what the actual political priorities are through his actions: the $400 check mailed to politically important homeowners, for example.
Public school children and their parents are net fiscal losers – one reason why suburban municipalities throughout the Northeast, where school costs are localized, try to zone them out unless their parents are very wealthy and will pay massive property taxes. New York City, it seems, has had a different fiscal strategy: children, even those of modest means, have not been excluded, but neither have they been educated.
The poor, who account for most social problems and street crimes, often require income support as well, and pay little in taxes, are also net fiscal drains; the disabled even more so. Suburban municipalities have been even more vigilant about keeping such people out of their taxing jurisdictions. New York City has been more welcoming. With large parts of the city’s housing stock reserved for the non-working and disabled poor, the city’s poverty rate is stable and can only go down so much. This will be an ongoing source of competition for scarce funds, particularly since as long as such people are concentrated in the city, the rest of the state will shift their cost to the local level. The need to reconstruct the city’s public housing is a potentially massive expense that has already begun to drain money from the rest of the city’s budget now that the federal government is abandoning it.
But the big wildcard for future public costs is very old Senior Citizens. The Plan predicts Education and Health Care (presumably more the latter than the former) will be the city’s leading economic growth sector in the next 23 years. But that sector absorbs tax revenues (through Medicaid) rather than generates them (because non-profit health care property is tax exempt). That growth, and health care and pensions for retired public employees, will divert money from the services discussed in PLANYC2030 even if New York City stops attracting more dependent poor people and continues repelling public school parents. Indeed, one wonders if our state legislature, for whom those retired, cashing in and moving out are the one and only priority, would be willing to allow the city to improve services for anyone else. They haven’t been in the recent past.
Even if the city becomes richer and younger than the rest of the country, on average, it may not help. The rest of the state and the rest of the country may have localized the cost of New York City’s poor, to whom they were hostile, but are more than willing to share the revenues generated by the city’s working citizens. Other parts of the state will be facing fiscal challenges similar to those New York City experienced in the 1960s and 1970s as the population ages, their growth slows, the number of retired public employees rises relative to their tax bases, and their housing stock passes 50 years old. These areas are not going to add new taxes while their services decline while allowing New York City’s services to improve. What “our residents, businesses, workers and visitors deserve” according to the plan is much more than they deserve according to the state legislature.
Given the absolute priority of the rest of the state and the seniors, PLANYC2030 has an idea to fund a better future for everyone else: hide the money. New fees – for driving in Manhattan and electricity use – would be placed in public authorities and limited to specific purposes. If money gets tight overall, however, money for the future is unlikely to remain hidden. One reason the MTA faces fiscal disaster is that its dedicated funding streams were raided in the early 1990s recession.
So what are my views? First, with regard to public infrastructure and facility improvements, the city can forget about anything that will not be finished by 2015 or so. From that point forward, as the baby boomers retire, all additional public money (and some existing public money) at the federal, state and local levels will be going to the ever-growing needs, wants and demands of senior citizens. Thus, the major improvements already in the works are the only ones we will see. If we get them, including six Second Avenue Subway stations rather than just three (forget the southern half of the line) we will have done well.
Second, if any additional facilities will cost more public money to run, the result will eventually be deterioration due to a lack of money for maintenance, to the eventual point of abandonment. The plan missed an opportunity to specify, for all infrastructure and facilities, how much ongoing normal replacement will cost. This must be funded – forever — before additional facilities are added.
Third, don’t assume a population boom; at most gains will be modest, so the needs that must be met are the deficiencies that are already present today. Finally, it is wrong to plan the city on the assumption that families will children will continue to be drained of tax dollars in NYC and then subsequently forced to leave when their children reach school age. The only way they will continue leaving is if the schools continue to be bad. That is the rest of the state’s plan for us; it should not be the city’s own.
And what are the good ideas in the plan?
First, proposals to more fairly allocate and more efficiently use existing infrastructure and facilities would allow the city to grow and improve without money it is unlikely to have. Second, segregating money for the future, infrastructure and general public facilities makes sense if we can get away with it, but that needs to go far beyond the proposals made here. Third, having the city’s additional development concentrated near existing subway stops makes sense, and not only because more suburban areas of the city “little will to accommodate newcomers.” Finally, it is high time infrastructure and public amenities, low priorities in NYC for so long, received a higher priority. They have been at the bottom of the barrel, compared with funding levels in other places, for so long.
According to the plan “the moment for facing up to our responsibility for the city’s long term future is now. The city will pass on to our children will be determined in large part by whether we are willing to seize the moment, make the hard decisions, and see them through.” Those two sentences run headlong into the reality of our long serving members of the State Legislature, certain members of the City Council, and the culture of our entire country, for whom responsibility, the city’s children, and hard decisions are anathema. It is when scarce resources are allocated that one finds what the values are.