Three Ways Developers Will Bankrupt Howard County and Destroy Quality of Life
Hiruy Hadgu
In early 2018, the Howard County Council passed a law to strengthen school mitigation standards by amending the county's adequate public facilities ordinance (APFO). For decades the County had required very little mitigation to address school capacity.
For example, if an elementary school was less than 115% over capacity a residential development could move forward.
Furthermore, if the school was over 115%, the project is placed on a so-called "Waitlist Bin” for up to four years. The capacity test is applied every year for four consecutive years and the project proceeds for development even if the school is still 115% over capacity in the fifth year.
In 2020, Councilmember Liz Wash’s attempt to increase the wait time from four years to seven years failed by a vote of 3-2. Councilmembers Christiana Rigby, Opel Jones, and David Yungmann voted against the measure.
The 2018 revision of APFO improved mitigation standards by requiring that “[D]evelopment won’t be allowed if elementary schools are 5 percent over capacity instead of 15 percent; middle schools have a 10 percent overcapacity limit, down 5 percent; and the update adds high schools to the test for the first time, with a 15 percent threshold.”
The reaction by the developer industry was swift. They labeled it a moratorium and produced various scary county maps covered in red to assist with their scaremongering campaign. Two different studies were funded to support their claims. One was funded by the Howard County Economic Development Authority (HCEDA) and another funded by the County and prepared by an entity called Urban Analytics. County officials were coordinating with the developer industry to develop a narrative that a moratorium was in effect.
Both studies claimed that residential development pays for itself and county officials repeated these false claims in official county presentations. In the past three years, county officials under current County Executive Calvin Ball, who voted for the 2018 legislation, have continuously spread this disinformation.
This identical conclusion was reached in 2004 by another developer-funded study. For over two decades, development has been largely unregulated due to this fatal assumption.
While developers paid only 2% of the annual capital project costs, the residential developments failed to pay for themselves. As a result, every year the county issues tens of billions of dollars in bonds to cover the shortfalls and pays tens of millions of dollars to service the bonds, annually.
The APFO restrictions in place cover only a portion of the considerations that should take place in mitigating “growth”. The road mitigation measures are extremely weak and have not managed to address traffic congestion. According to a county official the number of potholes that need county attention have been increasing annually and continue to do so. Other public facilities that deserve consideration are shown here.
Instead of working to improve the public facilities standards to ensure quality schools and therefore a healthy county budget, developers are gearing up for what will likely be one of the most vicious and expensive campaigns in county history.
Howard County residents witnessed a preview of 2022 play out in the Columbia Association’s Board of Director elections, when Howard Hughes Corporation and Merriweather Post Pavilion (MPP) funded a dark-money group called “The Rouse Project” to hijack an HOA election.
Developers Want to Replace Unfavorable Politicians
Developers will push for deregulation by electing their preferred candidates.
HHC’s recent presentation to investors makes it clear that its business model relies on “controlling cities.” Controlling CA would be a good start. But if it is to completely eliminate any public facilities standards such as APFO it would need to control the county by electing the next council.
Two Councilmembers that threaten HHC’s business model are Deb Jung and Liz Walsh, who, time and again, have voted to protect taxpayer dollars and hold developers accountable.
HHC will not only contribute to their opponents, it will supply funding to political action committees to ensure their defeat in 2022. Since he was elected in 2018, County Executive Calvin Ball has received $7,000 from Howard Research and Development Corporation (HRD), a subsidiary of HHC.
Since 2016, HRD has contributed nearly $138,000 to candidate and political action committees in Maryland. Of this amount, 51.5% or $71,000 were contributions made to Howard County candidate and political action committees.
The development industry is gearing up to make Councilmembers Jung and Walsh, one-term officer holders, much like the fate dealt to former County Executive Liz Bobo in 1990. “The loss was the result of displeasure over Bobo's slower growth decisions as executive, which prohibited development in environmentally sensitive areas and required infrastructure to be planned for and approved before development began.”
Developers Falsely Offer the “Supply/Demand Argument” to Explain Housing Affordability.
Howard Hughes Corporation through its Democratic establishment operatives is pushing a narrative that housing is expensive because of zoning restrictions and exclusionary zoning. The narrative seems intuitive in that more supply to meet demand would address affordability by reducing home prices due to the market effects. This is of course extremely flawed because home prices are subject to more constraints than supply and demand. Supply and demand affect the prices only marginally.
In a Washington Post article by Columnist Robert McCartney, Parisa Norouzi, executive director of Empower DC, a community organization of low-income residents, said: “More density does not create more affordability. It’s a smokescreen.” Norouzi said more supply might drive down rents in some cases from $2,500 to $2,200 a month, “but it doesn’t go down to $900, which is what the most low-income people need.”
Rather, home prices are subject to the quality of public infrastructure. Low-quality infrastructure equals low-priced homes. High-quality infrastructure equals high-priced homes. The most effective way to increase affordable housing is by requiring it. Even under a supply and demand only constraint, HHC’s own presentation shows that its profitability relies on controlling supply.
In 2016, HHC was given a density bonus and other favorable regulation in exchange for providing a thousand affordable homes. To date, in the Summer of 2021, HHC has delivered on only 24 of those homes among the thousands of market-rate units that have come online. Instead of holding HHC accountable for not meeting its obligations, the County Executive along with Councilmembers Opel Jones, Christiana Rigby, and David Yungmann rewarded it with more taxpayer dollars to fund the so-called “New Cultural Center.”
Developers Want to Short-Circuit APFO
Alternatively, they plan to short-circuit APFO by shrouding the argument in the benevolent goal of providing affordable housing to disadvantaged families and “equity.” Developers will argue to exceed the APFO school capacity limits by building homes that attract different income groups depending on the school region.
For example, if the school in question has a high rate of students that rely on free and reduced meals (FARM) - a proxy metric for low socio-economic status - developers will argue that more homes that attract higher income families should be built to reduce the FARM percentage even if school capacity exceeds the APFO limits. If the school in question has a low FARM rate, developers will argue for more lower income homes.
Developers are interested in electing county officials who will repeat false narratives. Both developers and county officials call increases in development “growth.” County officials call it “growth” because it represents an increase in revenue. But, how can a net decline in revenue after taking cost into account be called “growth”? It is inappropriate for a county official to measure success by “growth.” A government is not a business. There are elements of efficiency and other business principles that apply, but the most appropriate metrics are quality of infrastructure. Specifically schools.
Howard County voters should work to prevent the repeat of 1990. Then, Ms. Bobo’s loss was the result of displeasure over her slower growth decisions as executive, which prohibited development in environmentally sensitive areas and required infrastructure to be planned for and approved before development began.
Three decades later, the issues and choices have not changed. Will we pick leaders who will advance the cause of their special interest backers (against our own interest) and a corrupt establishment or will we pick those who will work to help the residents by improving accountability?