A version of this Policy Perspective was originally published as "Closed: Due to utopian planning," in the June / July 2000 issue of Brainstorm magazine (www.BrainstormNW.com).

Policy Perspective No. 1015
July 2000

The incredibly shrinking roadway system: Portland's campaign against the automobile

Approaching the Cadillac Café on Portland's Northeast Broadway one late Saturday morning, a hungry writer is surprised to see a crowd of people spilling out from the restaurant. He thought he had cleverly timed his arrival to avoid the morning rush hour, but the tiny café is jammed with patrons.

This poses a dilemma. The Cadillac is an excellent restaurant, a local landmark of sorts, but is it really worth a 45-minute wait?

Discouraged, the would-be diner concludes that the stomach must prevail over the brain, and the stomach wants food now. Across the street at the Village Inn, seats are plentiful. The choice is made.

Unfortunately for Terry Hughes and Rod Brackenbury, co-owners of the Cadillac Café, the sight of potential customers walking away is a recurring one because of the difficulty they are having expanding their restaurant. The Café currently occupies only about 1,050 square feet of rented space, and for more than two years, Hughes and Brackenbury have been trying to expand to a location about nine blocks east on Broadway. Much to their dismay, their redevelopment has become caught in a nightmarish web of city planning programs that threatens to shut down their expansion.

In the path of planning

Within the past decade, a philosophy has emerged from within the fields of planning and architecture, known as New Urbanism. In general, proponents of New Urbanism believe that people should live close to where they work, in high-density developments or single-family homes with very small yards. They also feel that residents should be able to walk, bicycle or take transit for a large portion of their trips.

This philosophy has become quite the rage among environmentalists, planners, and other special-interest groups, and Portland is usually held up as the poster city for New Urbanism. In fact, the annual conference of the Congress of New Urbanism was held recently in Portland, and featured numerous field trips to show off local developments purporting to have all the appropriate characteristics.

As part of Portland's effort to limit any expansion of the urban growth boundary, urban neighborhoods are being retrofitted by various city bureaucracies to conform to New Urbanist standards of higher densities, slower auto traffic, and more mixed land-uses.

The owners of the Cadillac Café have no particular beef with the New Urbanism. Many of their patrons arrive on foot from one of the nearby residential neighborhoods, and a Tri-Met bus goes right past their door. But in order to finance the city's numerous redevelopment projects, the city council has enacted so many expensive fees, permits and regulations on new construction that the cost of expansion for the Cadillac Cafe has doubled, from an estimated $600,000 to about $1.2 million.

"We're a small business trying to move forward," says Rod Brackenbury, "but the way it is now, unless you're a large business with extremely deep pockets, it's very difficult."

Some of the city surcharges include costs of approximately $42,000 in transportation system development charges, another $40,000 for sewer fees, and possibly $56,000 in fees for the proposed Lloyd District Local Improvement District-a tax program that would pay for various "improvements" desired by city planners.

Although Terry Hughes and Rod Brackenbury don't object to paying their fair share of the costs for city infrastructure such as roads and sewers, they feel that they are being used as an ATM machine for political projects that have nothing to do with the Broadway-Weidler district.

They also object to the arbitrary nature of how the exactions are collected. Major discounts or outright subsidies are available if you develop in politically favored parts of the city (such as the Pearl District), if your project is near a light rail line, or if you build huge projects with high density.

As Rod Brackenbury said, "Large corporations make deals and get exempted from these fees. It's totally unfair. Small businesses are the lifeblood of the city."

Follow the money

Many of the fees being imposed on the Cadillac Café and other businesses are relatively new. The state legislature authorized local governments to collect system development charges (SDCs) in 1989. SDCs are one-time fees paid by new development to pay governments for the capital costs of public facilities. Revenue can only be used for construction costs of projects, not for operations or maintenance.

In 1994, the U.S. Supreme Court ruled in Dolan v. City of Tigard (Oregon) that government exactions (such as SDCs) must be "roughly proportional" to the impacts caused by the development that is subject to the exaction. This means, basically, that the individuals forced to pay for so-called infrastructure investments must receive something in return that justifies the fee.

Portland adopted an SDC program for transportation in 1997. In addition to the ordinance, the City Council also adopted a list of 36 capital projects that will be partially paid for by SDC revenue. The total amount of SDC revenue that will be appropriated is $95.9 million.

When the city picked these projects, one of the key criteria for inclusion was that the projects include a component that "adds capacity to the transportation system." Theoretically, this criterion helps ensure that all projects meet the Dolan Supreme Court test of "rough proportionality," since each increment of development places some stress on the transportation system.

Unfortunately for the businesses paying SDCs, the city has chosen to use a slightly unorthodox definition of the phrase "capacity enhancement." Under the city's program this is interpreted to mean, "capacity reduction."

The most prominent example of this Orwellian approach is project #1 on the capital improvement list: "South/North light rail improvements," with a contribution of $5 million (this is not the total price tag for the light-rail project, just that portion attributable to transportation SDCs). Due to several ballot measure defeats, the South/North light rail line has temporarily been reduced to a proposed, 5.8 mile spur running from the Rose Quarter, up Interstate Avenue, to the Multnomah Exposition Center. The train will destroy two lanes of heavily-traveled Interstate Avenue, and replace some of Tri-Met's most cost-effective bus routes with expensive, 16 mile-per-hour rail transit. As a result, traffic will increase on Interstate Avenue and all parallel routes, including the already crowded I-5. According to the Environmental Impact Statement for the project, light-rail will cause traffic to go up by 58% on N. Denver Street, 33% on N. Albina, 25% on N. Greeley, 2% on MLK Boulevard, and 1% on I-5.

And since the line is scheduled to terminate at the Multnomah Expo Center-in the faint hope that someday, someone will be willing to pay for a light rail extension across the river to downtown Vancouver-the line doesn't really go anywhere of importance to most Portland residents.

So in essence, this proposal doesn't actually "enhance" transportation capacity in Portland, it cannibalizes politically incorrect portions (roads and buses), while providing virtually no benefits to the people forced to pay SDCs.

If this diversion of funds to capacity-destroying light rail were an aberration on the list of capital projects, it might be tolerable, but it's not. The second project, at $3 million (again not the total cost, just the transportation SDCs portion), is the central city streetcar, which will reduce roadway capacity in downtown Portland, while serving a transit market so sparse that there are currently no bus lines in that corridor.

In fact, looking at the list of 36 projects, it's difficult to identify very many projects that actually expand the total transportation system, and probably none of them will directly benefit the Cadillac Café or any other business along Broadway.

In defending this policy, city officials are unrepentant. According to Portland Office of Transportation spokesperson Mary Volm, "SDC projects increase the capacity for the transportation system, not just for the auto commuter. Just as your property taxes go to support the education system for the benefit of the entire community, so do the SDC projects benefit the entire network."

Come on and take a free ride

Meanwhile, numerous big developers are getting substantial reductions in transportation SDCs, or outright subsidies for their projects in addition to the waiver of fees. Partial or complete exemptions are available for any development within the Central City Plan District that includes at least 40 units of housing per acre, or any development located outside the Central City that is within 500 feet of a light rail line or within 1,000 feet of a light rail station, as long as it includes at least 30 units of housing per acre.

These giveaways are designed to encourage "transit-oriented developments" (TODs), an integral part of the New Urbanist vision. City planners support high-density TODs because they believe that lower-density development patterns are more costly to society.

In fact, the reverse is true. High density projects are expensive for both private developers and local governments. According to a recent report by the Portland City Club, the costs of development are about $62 per square foot for densities of 0 to 20 units per acre, but rise steadily to a high cost of $126 per square foot for densities above 200 units per acre.

This problem is made worse by Portland's insistence on using the highest-cost form of transit-fixed rail-as the centerpiece of the regional transit system. The proposed North Interstate MAX line will cost at least $70 million per mile, with subsidies of approximately $30 per one-way trip for every new light rail rider lured out of their car. Thus, handing TOD developers additional subsidies in the form of discounted transportation SDCs is simply adding insult to injury for taxpayers everywhere else who are forced to pay for development that they had no say in.

For example, the city's crown jewel re-development project, the Pearl District, will cost upwards of $200 million in subsidies for free infrastructure, demolition of the Lovejoy Ramp to the Broadway Bridge, and construction of the Central City trolley. Few Portlanders have knowingly consented to this income redistribution scheme.

In the end, the TOD-mania will cost unlucky businesses like the Cadillac Café substantial sums of money, while providing them with no direct benefits.

Chainsaw enhancements

The city's transportation SDC program is not the only barrier facing new and expanding businesses in the Lloyd District. A new transportation plan for the Broadway-Weidler neighborhood was adopted in April 1996. The summary of the plan explains: "the one-way couplet [of Broadway and Weidler] is enhanced with wider sidewalks, bike lanes, curb extensions at intersections, more traffic signals and a continuous and consistent streetscape."

The key word, once again, is "enhanced." To the casual observer, that term implies that traffic would flow more smoothly. In the world of Portland transportation planning, however, it means the opposite.

The plan mandates the elimination of one traffic lane on Broadway from 6th to 24th, elimination of another lane on Weidler from Victoria to 21st, new traffic signals at 2nd, 10th, 14th, 19th and 22nd to improve pedestrian crossings and "encourage slower traffic speeds," and removal of parking along the north side of Broadway between Williams and Northeast 6th.

The "enhancements" take the form of new striped bicycle lanes on Broadway and Weidler, and the expansion of sidewalks throughout the district from 6-8 feet in width to 12-14 feet. These so-called improvements come at the expense of roadway capacity, a zero-sum game in which a relatively few bicyclists are made slightly better off at the expense of everyone else.

Another notable enhancement in the district was the destruction of 83 beautiful shade trees along Broadway and Weidler. In a bizarre case of "killing the trees to save the sidewalks," the city spent over $4.4 million to cut mature pear and maple trees to make way for wider sidewalks. Local residents and businesses paid for 60 percent of the costs, whether they liked it or not. Though the city did plant more than 100 new trees, many locals were outraged.

Portland's Mary Volm defended the decision by saying, "The roadway capacity in Broadway-Weidler is excessive for a street that borders five residential neighborhoods and serves a business district of small, unique and indigenous businesses. The residents enjoy browsing in the shops and eating in the numerous restaurants. Due to the heavy volume of traffic, the residents and businesses chose wider sidewalks with trees, bicycle lanes, and transit amenities to buffer them from traffic."

However, there are several reasons to question this explanation. How many "residents and businesses" actually wanted 83 mature shade trees mowed down just so the city could pour more concrete? People who participate in neighborhood associations or attend public hearings represent only a fraction of all neighborhood residents.

And how does replacing large street trees with little saplings provide an improved "buffer" for pedestrians from the now-increased traffic?

Most importantly, the very idea that we have to expand sidewalks to accommodate the army of pedestrians predicted by Portland planners is comically out of date. Portland's population density has been steadily declining for over 40 years. Pedestrians might be better off if we reduced the width of sidewalks and used the space for more vegetation.

As is now the norm in Portland, the Broadway-Weidler Corridor Plan had all the trappings of public involvement and feel-good visioning. There were project team leaders, inter-agency technical advisors, outside consultants, and a citizen advisory committee. Many public meetings were held and citizen testimony taken. It's possible that everyone even held hands and sang "Kumbaya" before the process was finished.

But none of the public input really mattered with regard to the fundamental philosophy of the city, which is to make driving as difficult as possible and siphon off huge sums of transportation dollars for transit projects that won't serve very many people.

Going Hollywood

Meanwhile, at the other end of Broadway, Neal Arnston is facing similar pressures from Portland's New Urbanist planners. Arnston, owner of Albina Fuel, is a long-time business owner in the Hollywood District. Since 1903 his operation has been located on the south side of Broadway near 33rd, just north of the Banfield Freeway, on an oddly shaped parcel dotted with tanker trucks. Portland planners see this sprawling piece of property as underdeveloped by New Urbanist standards, and have slated it (and surrounding properties) for higher density redevelopment in the recently adopted Hollywood-Sandy Neighborhood Plan.

The Hollywood-Sandy plan was developed to conform with Metro's 2040 concept (a long-term land-use and transportation plan adopted in 1996), which designates the Hollywood area as a "town center" and Broadway west of 39th Street as a "main street." These terms have special meaning in the 2040 plan; basically, property owners can now look forward to years of "traffic calming" (speed bumps, traffic circles, lane width reduction, etc.), sidewalk widening, and ineffective transit investments. Most importantly, these areas have been re-zoned for higher density, which will have only marginal effect on transit ridership but will help congest the region and thus reduce traffic speeds.

The city is planning to increase density and transit use in the district despite acknowledging in the Plan that "between 1980 and 1990 the number of people that drove alone to work from neighborhoods in the study areas has increased steadily. The percent of people riding transit decreased with the exception of Hollywood and the Sullivan's Gulch neighborhoods; the number of people who walked to work also decreased."

In fact, throughout most parts of the city, walking and biking to work is declining, while single-occupant driving is rising. These trends reflect the conscious personal decisions of thousands of Portland residents.

Ordinarily, in competitive markets, suppliers would try and provide more of what people want -- better roads and flexible transit-at higher quality and at lower cost. However, since the Portland transportation system is run as a government monopoly, managed by political operatives who believe in New Urbanism, the goal is exactly the opposite: to provide less of what people want, at higher cost with inferior service, in order to force people to adopt politically-mandated behaviors.

The proposed changes in the west end of Broadway will make it very difficult for Albina Fuel to get its trucks in and out of the neighborhood because of the city's emphasis on narrowing traffic lanes and widening sidewalks. Arnston pointed this out repeatedly to city planners during the planning process.

But despite the extensive public outreach program-the walking tours, design simulation exercises, open houses and public meetings-the only input that counted was input that supported the pre-ordained outcome of mixed-use, auto-hostile development.

When asked if it mattered to planners that he was a fourth generation business owner (with four of his own sons in the business as well), Arnston said, "No. Our views got in the way of their idea of a utopian society."

In fact, his views were not even acknowledged by Portland City Council members. As City Commissioner Jim Francesconi said after the council adopted the Hollywood-Sandy Neighborhood plan in April, "In contrast to other parts of town, these people realize it will enhance their businesses and neighborhoods."

Neil Arnston was stoic as he contemplated his newly enhanced future: "It's very simple. I don't have any power. So I'll leave. We'll probably just move our operation to Vancouver."

And lest he be mistaken as merely a self-centered business owner, it should be pointed out that Arnston is one of the most civic-minded individuals in the city. He is sharing his considerable wealth with some of Portland's poorest families as a sponsor of the "I Have A Dream" program, in which he has guaranteed college scholarships to every graduating member of a local high school class that he "adopted" 10 years ago. Though some of the kids in his class have fallen by the wayside, there are still over 90 kids eligible for his scholarships, and he keeps in personal contact with them.

But city planners have limited interest in old-line industrial businesses like Albina Fuel. The company occupies a relatively large piece of real estate that is ripe for New Urbanist gentrification, and the business of hauling oil all over the city in trucks isn't very glamorous. There really isn't much place for it in the New Urbanist vision.

Always the pragmatist, Arnston admits that in strictly financial terms, the Hollywood-Sandy plan will probably be good for him. Now that the city is encouraging and/or requiring higher density development, he stands to make a lot of money selling his property for an upscale transit-oriented development. But it saddens him to leave the neighborhood on terms other than his own.

However, at least his daily commute will improve when he moves the business to Vancouver. He lives on Skyline Boulevard in Northwest Portland, and for years drove to work by taking the Lovejoy Ramp to the Broadway Bridge and then down Broadway to his office. But last year, the Lovejoy Ramp was demolished by the city in order to give politically connected developer Homer Williams the opportunity to build a high-density TOD. Various public entities paid for the demolition, at a cost of more than $10 million, in order to "enhance" the capacity of the transportation system by shrinking it. As a result, Arnston now takes a more circuitous route (still by car, though; this may be shocking news to the planners who approved the destruction of the ramp), thereby driving more than he did before.

New Urban endgame

Unfortunately, there is only minimal consumer demand for dense, mixed-use communities, and absolutely no evidence that building TODs will reduce traffic. In fact, densifying a region through transit-oriented development makes traffic worse, because even though the transit ridership in a dense area is marginally higher than in a more dispersed community, the ridership gains are swamped by the sheer number of people living in the TOD, most of whom own and use cars.

The City of Portland, Metro, Tri-Met, the State of Oregon, Portland Development Commission, and numerous other bureaucracies have poured literally hundreds of millions of dollars into subsidies for TODs in the past 15 years, but none of those jurisdictions has yet to produce real data justifying the continuation of these programs. In fact, the world of pedestrian-oriented travel lives mostly in the imaginations of the New Urbanists, who like nothing better than to spend someone else's money to impose their aesthetic preferences on everyone else.

The result of all this foolishness will be a massive increase in traffic congestion throughout Portland. In fact, Metro is planning for it. In Metro's 2040 plan, the agency predicts that if we build all the new light rail lines the agency wants, and if we subsidize lots of transit-oriented developments, the result will be a 202 percent increase in congestion by the year 2015.

They are planning for this outcome despite the fact that a poll taken for Metro in 1993, by Decision Sciences, Inc., showed that the number one livability issue for Portland residents at the time was the growing traffic congestion. In contrast, only 2 percent of the people polled rated "urban sprawl" as an issue of concern, yet Metro's entire multi-billion dollar 2040 plan is designed to limit sprawl.

A more recent poll, conducted by Moore Information for Metro in April, 2000, reaffirmed that traffic congestion remains the top-ranked livability concern for Portland residents.

Perhaps after city planners induce complete traffic gridlock in Portland they'll finally be happy. By then, maybe Lloyd district residents will be forced to walk to the Cadillac Café, since the "enhanced" roads of the neighborhood will be unusable. Except that there may not be any seats for them at the still-unexpanded restaurant. So maybe residents in the Lloyd District will join ex-Portland business owners in moving to Washington state. Then Portland's New Urbanist vision will be complete.

Cascade Policy Institute is a tax-exempt educational organization as defined under IRS code 501(c)(3). Cascade neither solicits nor accepts government funding, and is supported by individual, foundation, and corporate contributions. Nothing appearing in this document is to be construed as necessarily representing the views of Cascade, or as an attempt to aid or hinder the passage of any bill before any legislative body.