Daily Journal of Commerce Highlights 1000 Friends Infrastructure Report

Lee Fehrenbacher
Daily Journal of Commerce
Wed, 01/16/2013 (All day)

The Daily Journal of Commerce has looked into our recent report on the infrastructure challenges facing Oregon communities, and what we can do to save taxpayers money in the long run.

Featuring some corroborating examples from Washington County, reporter Lee Fehrenbacher digs deep into what infrastructure costs could do to the Portland Metro region and Oregon overall.

Fehrenbacher writes (emphases added):

Far from Wall Street, a Ponzi scheme is unfolding in Portland’s backyard, according to Jason Miner, executive director of 1000 Friends of Oregon. Many people know it as urban sprawl.

“You can see the Ponzi scheme playing out across the landscape, when a current development pays into local government coffers to a certain extent in (system development charges) and other fees, but those fees don’t cover the long-term costs of sprawling,” Miner said. “They don’t cover the long-term costs of the development.”

A new 1000 Friends of Oregon report calls out sprawl development as a major reason why the region has such a massive infrastructure funding deficit. The report – “More Extensive is More Expensive: How sprawl infrastructure bankrupts Oregon communities, and what we can do about it” – contends that sprawl is inherently costlier than infill development, and that municipalities create unsustainable communities when they trade short-term stimulus for neighborhoods they can’t afford to maintain in the long run.

According to a Regional Infrastructure Analysis completed by Metro in 2008, Portland’s three-county area needs between $27 billion and $41 billion for infrastructure improvements to accommodate anticipated growth by 2035 – traditional funding sources are expected to cover only half of that amount. Meanwhile, the region faces a $10 billion deficit for repairs of existing infrastructure.

“We have a lot of infrastructure needs facing the region for growth that we expect to occur and haven’t really sorted out how that’s going to happen (and) how that’s going to get paid for,” said Tom Imeson, public affairs director for the Port of Portland.

Imeson is one of the business leaders spearheading the Community Investment Initiative, a civic effort to identify new funding sources for infrastructure projects. He is developing the framework of the initiative’s Regional Infrastructure Enterprise, in which infrastructure investment will be facilitated via project identification and partnerships with industry stakeholders.

Efforts to bridge the infrastructure gap are already under way at the state level. In November, Oregon State Treasurer Ted Wheeler announced creation of the West Coast Infrastructure Exchange, a regional partnership between Oregon, California, Washington and British Columbia. Their combined need for infrastructure projects is estimated at $1 trillion over the next 30 years. The hope is to leverage private capital by bundling similar projects together.

At the national level, the American Society of Civil Engineers identified an investment need of $2.2 trillion over the next five years.

For its part, 1000 Friends estimates “quality growth,” or development serving existing communities or built areas, could cut infrastructure-related costs by 47 percent.

Greg Malinowski, a Washington County commissioner, said he sees the impact of sprawl often.

“Our roads are not really safe for pedestrian traffic,” he said. “We have schools out here that are providing buses to haul kids 50 feet to school because there’s no safe way for them to cross the street. They can see the school, but they can’t get there and we can’t put a crossing in because we don’t have the funds.”

Malinowski added that streetscapes are deteriorating in some unincorporated areas with older houses from the 1950s and ’70s. Cities won’t annex those communities, he said, because they don’t receive enough taxes to cover the cost of providing infrastructure.

Meanwhile, development is forging ahead in the county’s North Bethany area – 800 acres of farmland slated to receive between 3,755 and 4,653 units. Arbor Custom Homes, Oregon’s largest private homebuilder, is acquiring entitlements to build 700 new units there. It’s hoping to break ground in May or June on developments featuring 125 single-family homes, 131 townhomes and 420 condominiums or apartments.

A Washington County law passed in 2008, requires developers like Arbor to cover 28 percent (up from 10 percent) of the cost of infrastructure associated with new development. That leaves taxpayers on the hook for 72 percent. In the case of North Bethany, Malinowski said there is a gap of approximately $96.2 million between what is needed for road improvements and what development will pay for.

Malinowski said Washington County’s infrastructure deficit is approximately $2 billion. Rather than add to that with sprawling development, the county should reinvest in communities it has already built, he said.

“To me what adds wealth to a community is that you can live in an older neighborhood and every year your property values go up,” he said. “If we just abandon the older communities and just keep building newer ones, then after a while the property values don’t go up.”

Miner agrees. 1000 Friends of Oregon, in its report, contends that communities should be required to conduct fiscal impact analyses that weigh the relative benefits of infill versus sprawl before they are allowed to create new development plans. Current law, for instance, requires municipalities to evaluate multiple sites for potential urban growth boundary expansions, but does not require that those sites be compared to brownfields within the UGB that could be cleaned.

The idea is to motivate transparency and better-informed decisions, Miner said. 1000 Friends of Oregon, for now, is presenting its concept as food for thought.

“We are trying to prevent sprawl or leapfrog development and the great inefficiency that that leads to in our communities,” Miner said. “I see a change in community values (that favors) fixing what we have first, and realizing that public investment in large infrastructure projects, the way it has been done in the past, isn’t possible in the future and isn’t happening today.”

We encourage you to read our infrastructure report for yourself, and share it with leaders in your community. Download the report or a short summary at friends.org/infrastructure.

Read the DJC's article on its site here. (Subscription required.)