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Sprawl Tax

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lr_sprawl-custom1

How much does sprawl cost Americans every year?

That got us thinking: What if we could quantify some of these same issues from a city-friendly angle—measuring not the cost of congestion, which suggests that the solution is to build highways until every car is free on its own field of asphalt (a solution, by the way, that we know doesn’t work), but the cost of sprawl: of patterns of building that make people travel longer because their home, work, and other destinations are so physically far from each other?

So this week, we present the “Sprawl Tax”: what it is, how much it costs us, and what we can do about it. We found that the in time and money, American commuters have to pay a sprawl tax of over $107 billion dollars a year in the 50 largest metropolitan areas—nearly $1,400 for the average commuter. That includes the costs of the 3.9 billion additional hours American commuters spend traveling to and from work per year, or about 50 hours per worker.

Adding together the sprawl tax for each of the largest 50 metropolitan areas gives $48.5 billion dollars per year—or nearly $630 for every commuter annually. The financial aspect of the sprawl tax varies from $34.7 million in New Orleans to $4.7 billion in Dallas. In per commuter terms, the region with the biggest sprawl tax is Atlanta, where sprawl costs the average commuter more than $1,600 a year. The city with the smallest per capita sprawl tax is New Orleans, at just $60.66 per commuter per year.

But these figures reflect just the out-of-pocket costs of owning and using cars. What if you take time into account? After all, the longer trips forced on commuter by sprawling cities cost money, but they also cost time. Using a similar methodology, we calculated an “excess travel time” index, applying average travel speed for each metropolitan area to its benchmark commute distance, as opposed to its actual commute distance.

The result? In the 50 largest metro areas, sprawl costs commuters 3.9 billion hours per year, or more than 50 hours per year per commuter. That means sprawl makes the average commuter spend over two entire days per year traveling to and from work unnecessarily. The worst offender? Atlanta, where the average commuter loses 112 hours per year, or over four and a half days. In the metro area that performs best, New Orleans, commuters lose just over seven hours per year.

Many Americans think sprawl is a great thing because they own their 2500 square foot home but the cost of commuting 30 or 50 miles to a job is incredibly high, economically and personally. But those costs get naturalized by most people, while the costs of building dense, affordable housing and good public transportation are seen as expensive luxuries that also reek of being un-American, unlike my giant suburban house and big SUV.

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  • LeeEsq

    Step 1: Create tax to tackle sprawl
    Step 2: Something magical happens and we get this tax implemented
    Step 3: We rethink step 2.

    • Read the article. The author isn’t calling for a sprawl tax. The author is saying we are already self-taxing ourselves through the cost of our sprawl.

      • LeeEsq

        Your right.

    • Murc

      The article is using “tax” as a rhetorical device, not calling for a literal tax.

      This is in fact a very old rhetorical device; describing externalized or invisible costs as a “tax.” I’m ambivalent on it, because it relies on seeing taxes as a bad thing which is an attitude that absolutely needs to die in a fire, but it has a long pedigree.

      • Jay B.

        I actually think in this case it can work in the opposite. I was just having this conversation yesterday — I live in California, there are no shortage of people who live here who bitch that their taxes are too high.

        Now I’m in a professional field, and most of my friends are as well, so I try and point out that either there is no comparable career in other places (like at Disney Studios, say) and for other well-paying careers, you would be paid less in another city with lower taxes. You don’t end up saving anything.

        This is also the case with how New Hampshire sets itself against Massachusetts. New Hampshire, of course, doesn’t have an income tax, but between dog-choking property taxes and the commute the people have to Boston or 128 every day, it becomes comparable to paying the effective Massachusetts rate when you add in the “sprawl tax” outlined here.

        Only the really rich game the system. Everyone else pays some fees for trying to avoid taxes by living in suburbs in low-tax states at lower salaries or long commutes to beat city tax rates.

  • LeeEsq

    Future archaeologists are going to wonder why we ancients built that symbol in the ground.

    • busker type

      probably had something to do with marking the summer solstice

      • Lurker

        I think that street layout is simply calling for someone to write a Lovecraftian horror story.

        • AttorneyAtPaw

          Beautiful 3400 SF home at the corner of Rosewood and Cthulhu.

  • And those costs don’t even begin to take into consideration the cost of extending infrastructure like water and sewer. Adding the administration costs of multiple small governments runs the total up even higher.
    Sprawl also comes with significant cultural and social costs. Gated developments (I refuse to use the word community for such places) allow people to literally wall themselves off from “the other”. It creates a pattern of exclusion and heightens inequality.
    The problem isn’t limited to metropolitan areas. I live in rural North Carolina. Folks retire here for the mountain views but the costs and disruptions to local communities are significant and ecologically damaging. It’s not enough to have access to wonderful national parks and lots of national forest – people want their own piece of nature (much to nature’s detriment)and besides national parks and forest land is just damn socialism

    • cleek

      And those costs don’t even begin to take into consideration the cost of extending infrastructure like water and sewer.

      which is why many rural homes have well water and septic systems.

      and if we hadn’t gotten ripped off by our last builder, we’d have solar electricity and geothermal H/AC.

      (rural central NC)

  • delazeur

    50 hours per year is 12 minutes per day (assuming you work 250 days per year). That’s not much at all, and because it won’t be distributed among workers equally it’s not a good measure of sprawl.

    Also, if 50 hours per year is worth $1,400 that’s an hourly rate of $28, which seems high to me. In annual, full-time terms $28 is just about the national average household income. Also, we would expect the workers with the longest commutes to have lower incomes.

    I agree that sprawl is gross, expensive, and inconvenient, but I don’t think this article is doing a good job of translating that into numbers.

    • Bill Murray

      yes, 50 hours per year seems way too low for someone that actually commutes. To do less you would have to basically work at home, which not that many people do. I live less than 2 miles from where I work and my commute is about 5 minutes each way, which makes me about average.

      Also, we would expect the workers with the longest commutes to have lower incomes.

      Would we? That is definitely not true in the places I have lived. I imagine this is highly place specific, though.

      • Cash & Cable

        The 12 minutes per day represents “how much shorter daily commutes might be if metropolitan areas were less sprawling,” not the total time spent by the average commuter.

        And the “tax” isn’t being calculated by multiplying additional commuting time by an hourly rate. It’s (Additional commuting distance attributable to sprawl) X (261 working days a year) X (58.1 cents per mile) X (2 commutes per day).

        This is all clearly stated in the article.

        • delazeur

          Sure, the tax isn’t being calculated based on an hourly rate, but we can still back out an hourly rate from the numbers and I think it’s suspiciously high.

          • Redwood Rhiadra

            Blame cars for being expensive to operate on an hourly basis then. Because that’s what the “58.1 cents per mile” is – the cost of operating a car (as estimated by the IRS).

      • Just_Dropping_By

        I had a similar reaction to the longer commute = lower income claim. In the Denver area, I think it looks more U-shaped, at least for jobs in the downtown area: higher income close in (downtown area/Capitol Hill/Riverside/etc.; lower income midway (outer edges of Denver; immediately surrounding suburbs); higher incomes furthest out (houses in the foothills above places like Evergreen, Conifer).

      • delazeur

        Also, we would expect the workers with the longest commutes to have lower incomes.

        Would we? That is definitely not true in the places I have lived. I imagine this is highly place specific, though.

        This is actually an interesting question that probably depends a lot on the city. In Manhattan or San Francisco, for example, I would expect it to be very true. In a Middle America suburban sprawl city it is probably much less true.

  • BiloSagdiyev

    https://www.youtube.com/watch?v=lUrNrZqb1kw

    I wouldn’t live there if you paid me.
    I couldn’t live like that, no siree!
    I couldn’t do the things the way those people do.
    I couldn’t live there if you paid me to.

  • DAS

    Just ending sprawl doesn’t solve the commuting problem though. Plenty of people who live and work in urban areas still have hour long commutes: if you work in lower Manhattan or Brooklyn and live in Queens, you’re looking at an hour in a standing room only bus then subway. And even if you could afford to move closer to work, who’s to say you won’t lose your job and find a new one an hour commute away from where you moved? And that’s not also including trying to find a house near to two workplaces for families with two income earners.

    • sharonT

      This is my world. I have a two hour commute via train and subway, one way. (Thank you DC/Maryland suburbs mad expensive real estate.) I can’t afford to live in the neighborhood that I grew up in.

      I’m grateful for mass transit, I’d never drive two belt ways and I-95 twice a day. It’s not like up zoning is a foreign concept in Silver Spring, we just can’t afford to buy a condo and eat at the same time.

    • TribalistMeathead

      And even if you could afford to move closer to work, who’s to say you won’t lose your job and find a new one an hour commute away from where you moved?

      This is exactly what happened to my parents – every time they sold their house and bought a new one so my dad would have a shorter commute, his work location would change or he’d get laid off.

    • twbb

      I used to commute from Queens to Brooklyn via car and it took approximately 45 minutes to an hour, with a random 1-30 minutes on both ends to find parallel parking. It was still shorter than going by subway would have been.

      On the plus side, I was paying $500 for a room in a decent apartment. In 2011.

  • Not sure how well it would fit into the “Sprawl Tax” concept, but there’s also a serious element of infrastructure upkeep and housing stock deterioration that costs a ton. For example, there are a lot of housing developments near my parents house that were built in the late 80s-early 90s time frame.

    What’s weird is that when I go through them now, neighborhoods that had lots of kids when I was a kid are now conspicuously devoid of kids or even just play structures in those big lawns. The houses themselves are mid-grade mid-sized McMansions of the time, so I don’t think they were a) built to last or b) would have much resale value for the young parents of today. My understanding is that places like these are becoming both maintenance nightmares (in areas that worship near-zero property taxes) and very hard to resell.

    Sprawl, once built, doesn’t endure well.

    • CrunchyFrog

      Well, the developers of those places don’t give a rat’s ass about what happens in 10-20 years after they are gone, that’s to be sure.

      Which brings up another point. There was a time when it was considered routine for a locality to insist that the developer of large housing development use part of his profits to fund infrastructure improvements – roads, fire stations, police stations, schools, and – in rational areas (i.e. not the US) public transport. Recently in Wingnutopia, I mean Colorado Springs, the city council learned that a developer of a large tract that for bankruptcy reasons has remained undeveloped for decades was burdened with an old provision that he build that kind of infrastructure. Of course, the council – most of whom are developers or have their campaigns funded by local developers – saw that as an outrage. That would never happen in these enlightened times, they said. Now that new developments are extending the Colorado Springs sprawl toward the north, east, and south (guess which direction the mountains are?) the taxpayers are expected to fund the connecting streets and other infrastructure, which partly explains the funding problems for the city.

      • twbb

        In Florida, in one of the few exceptions to our history of poor planning decisions, developers used to be required to fund infrastructure hookups to their developments when they were off the grid.

        Fortunately our heroic governor, during his campaign to save taxpayer money, successfully had that provision removed so taxpayer money could save those developers from having to forgo their fifth Ferrari.

    • efc

      There was a article in the NYT today about how lots of houses built in an 80s housing boom in Connecticut now have crumbling foundations.

      “Across nearly 20 towns in northeastern Connecticut, a slow-motion disaster is unfolding, as local officials and homeowners wrestle with an extraordinary phenomenon. Hundreds, possibly thousands, of home foundations that have been poured since the 1980s are cracking, with fissures so large you can slip a hand inside.”

      “John Patton, a spokesman for both companies, has attributed the crumbling foundations to improper installation, specifically the tendency of some contractors to add water to wet concrete to make it pour faster. That was especially true, he said, during a building boom in the 1980s.”

      • Rob in CT

        I heard that it has something to do with a material used in the concrete too.

        Not sure this is really a sprawl issue, but yeah it looks like kind of a big deal around here. I’ve gotten fliers from my state rep on it repeatedly (my house was built in ’01 so hopefully I’m good. If not, the guy who built the house lives three houses down so I know where to find him ;)).

        • Rob in CT

          http://www.journalinquirer.com/state-links-pyrrhotite-to-crumbling-concrete-companies-agree-to-halt/article_40a4c4e2-16c0-11e6-87fb-8b3ab9ac3b33.html

          pyrrhotite.

          STAFFORD — J.J. Mottes Co. and Becker Construction have agreed to stop supplying aggregate for residential foundations for at least one season after the state found that Becker’s Quarry contains pyrrhotite, a mineral believed to be the cause of failing concrete.

          The two family-run companies at the center of an ongoing issue regarding failing concrete foundations — J.J. Mottes Co. in Stafford and Becker’s Quarry in Willington — have entered into an assurance of voluntary compliance with the attorney general and the Department of Consumer Protection to not sell material from the quarry at least until June 2017.

          Through its investigation, the state has determined pyrrhotite found at Becker’s Quarry is partially to blame for crumbling concrete foundations, a conclusion disputed by J.J. Mottes.

          Attorney General George Jepsen said Monday that while a state investigation into the cause of crumbling foundations continues, the material should not be used for residential construction.

  • Sebastian_h

    “Many Americans think sprawl is a great thing because they own their 2500 square foot home but the cost of commuting 30 or 50 miles to a job is incredibly high, economically and personally.”

    This analysis need an ‘and’. As in…. and people in successful cities don’t want to build enough dense housing to risk poor people being able to afford living there.

    Both sides of sprawl are trying to subsidize their preference to avoid poor people.

  • Lt. Fred

    Paul Newman, Australia’s finest urban planner, puts it like this. There are three types of cities

    1) Brisbane, Houston, Atlanta: 15% of GDP spent on transport
    2) Paris, Berlin, New York: 10% of GDP spent on transport.
    3) Hong Kong: 2% of GDP spent on transport.

    • BiloSagdiyev

      4) Lagos (You’re not even going to get there)

      • Anna in PDX

        Having lived in both Lagos and Cairo, I can vouch for Cairo being worse. An apocryphal story about a group of Scandinavian traffic planners comes to mind. The story goes that they came to Cairo in the mid-90s, did their calculations and told the Egyptian government “according to this your traffic should have stopped in 1975.”

        • LeeEsq

          Egypt really should have started building a subway system for Cairo a lot sooner and not have gotten into car culture despite their oil.

          • rea

            despite their oil.

            Egypt doesn’t particularly have oil.

    • LeeEsq

      Lots of people would not want to live like they do in Hong Kong though. People might be willing to spend more on transportation for more living space and an ability to be alone at times. I say this as somebody who has lived in apartments in NYC since he was 21.

      • Lt. Fred

        Cool, and that’s fine, but you’re going to be way poorer. People can make that choice, but it should be made directly.

        Personally I want a city like Berlin.

        • erick

          Yeah I see two main points:

          1) if people want to live in group 1 type cities fine, but they need to pay the cost not dump them on all of us.

          2) NY, Berlin and Paris show how the middle type city can still have very different profiles, density doesn’t automatically mean Manhattan

  • CrunchyFrog

    2-3 years ago I frequented Electric Vehicle forums (it was a new fad then) and a very common posting was along the lines of “My commute is 60 miles each way and gasoline costs are killing me. Wondering if an EV could make that commute?” One of the most famous LEAF early adopters had a commute like this, which is how he became the first with a very high mileage LEAF. My reaction (which I kept to myself) was always “why the HELL do you put up with a commute like that???? Forget the car, you need either a new house or new job.”

    What I really don’t get are the people who happily drive 1.2 hours each way in, say, the SF bay area, covering all of 20 miles each way, bumper-to-bumper all the way.

    I understand sometimes circumstances force you into bad situations. In 2001 Santa Clara County shed 500k jobs. My startup was bought by another startup and I was offered a continued job on the condition that I commute to the north end of San Fran. Horrible – took me 8 months to find a replacement job near home. I’m not talking about temporary situations – I’m talking about people who choose to commute 1-2 hours each way as part of normal life.

    • djw

      What I really don’t get are the people who happily drive 1.2 hours each way in, say, the SF bay area, covering all of 20 miles each way, bumper-to-bumper all the way.

      “happily” assumes facts not in evidence.

      For some, at least, I suspect moving closer isn’t an option because their only access to housing they can afford is to hang on to their rent-controlled apartment. (This, I think, is one of the underappreciated costs of rent control as an affordable housing tool.)

      • twbb

        I think it’s driven a lot by placing too much weight on factors that don’t, in my opinion, outweigh a soul-crushing commute — per capita spending on students at local schools, the desire of a non-commuting spouse to have the “perfect home,” white anxiety, perceived social esteem having a larger house brings, etc. The mental and economic costs of that commute doesn’t register until they’re actually doing it every day.

        • CrunchyFrog

          It’s not just the white middle classers. Consider that in Santa Clara county, referenced earlier, that large majority of gardeners, maids, and handymen commute an hour each way from relatively cheap locales in the central valley like Los Banos.

        • djw

          Oh, yeah, those are a bigger part of it. And we’re terrible at forecasting or fully accounting for the harms associated with long commutes; as much as people bitch about their commute, they also underestimate the toll it’s probably taking on them.

      • MattT

        For some, at least, I suspect moving closer isn’t an option because their only access to housing they can afford is to hang on to their rent-controlled apartment. (This, I think, is one of the underappreciated costs of rent control as an affordable housing tool.)

        It seems kind of analogous to some of the problems with employer driven health insurance, where it can be a lot harder to pursue a better job, for reasons that have nothing to do with the job.

        • CrunchyFrog

          Interesting point. I recently needed to change jobs due to the impending failure of my private-equity-owned employer. A very large Silcon-Valley-based employer offered me some interviews. In the past I would never have considered working for this entity. However, being mid-50s (translation: subject to age discrimination) with 3, soon 4, kids in college and surprisingly large medical bills of late for the family (yes, we actually qualified for the medical costs deduction – which means that top quality family heath benefits are worth $5-10k and more to me annually), suddenly one of the Great Satans of Silicon Valley became quite an attractive employer. I’ve been with them a year now, and occasionally contacted about exciting opportunities elsewhere, but the job security + health benefits mean I’m probably retiring with this employer.

    • Steve LaBonne

      I have been commuting 60 miles each way since 2012, and will continue doing so until 2021, because I remarried, I have no prospect of finding another good job at my age let alone one in the Ohio public employee retirement system (which will provide the bulk of my retirement income), and for a variety of personal and financial reasons there is no acceptable alternative to living in the house my wife has owned for going on four decades. But believe me, I’m not doing it “happily”. It’s necessary and I put up with it, but it sucks.

      • CrunchyFrog

        I am very sympathetic to your situation. Very likely a lot of people are in your boat, and that really stinks.

        However, I’ve also known a lot of people who’ve chosen the long commute lifestyle for one reason or another. Even here in northern El Paso County, Colorado, I know a lot of people who commute 50 minutes one way to one of the two air force bases nearly bordering each other on the south side of Colorado Springs. The question isn’t why they work there – these ex-military officers have never received a non-DoD paycheck in their lives, so of course they are going to be commuting to one of the military bases locally. The question is why they chose to live in a locale so far away when so many other similar locales with similar prices are closer. They all have their reasons, but in no case were they forced here because of housing costs.

        • Just_Dropping_By

          Yes, I feel like this situation is common in Colorado. I’ve known plenty of people with what seem to me like unbearably long commutes, but who could certainly afford a house of similar size/quality located much closer to their job.

          • Denverite

            A lot of that is that there are a lot of attractive foothills communities about 45 minutes from downtown with traffic (Evergreen, Golden, Castle Rock, even Boulder). For some, the commute is worth it if you get to live with mountains and deer in your backyard.

            (We live in the city, three minutes from my spouse’s job and fifteen minutes from mine.)

  • djw

    I was meaning to blog this one. I know he mentions it as an additional, aggravating factor, and it’s somewhat trickier to quantify, but any effort to estimate a sprawl tax really should try to take into account the harm to one’s physical and mental health of long commutes.

    • I think he is going to have a follow up post on those issues.

  • tomstickler

    To channel Krugman imprecisely: one’s expense is another’s income.

  • One of the secrets of Sprawl is that it leads to pretending that you’re “fiscally responsible” when you spend 30% of your gross income on housing directly–while adding another 15-20% in transportation costs.

    If I spent 50% of my income on an apartment two blocks from work, is that “worse” than the combined house/car/drive time costs?

    It leads to describing SF as “unaffordable” because it doesn’t follow the rules of Indianapolis or Omaha.

  • Robespierre

    Yet another reason to support Georgist taxes! Yes!

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