6,200 and counting

Some town leaders have had it with this hick town and want to take Chapel Hill to the Nancy Oatesnext level of cityhood. Town Council approved the redevelopment of Central West. Obey Creek is on track to sail through intact as the developer wants it. And council is poised to allow developers carte blanche in the ever-expanding territory of the Ephesus/Fordham redevelopment.

The rationale for growth always has been snowshoeing the tax base: If you distribute over a larger area the weight of the tax burden the town needs to pay its bills, you’re less likely to sink. But if expanding the tax base results in higher expenses, increased growth defeats the purpose.

Town staff have not done a study to find that tipping point of how much growth is too much. At least they haven’t made that information public. Devoting time and resources to come up with the sweet spot of density that will pay for itself would be important information to have as the council members prepare to make decisions on the extent of redevelopment that’s in the town’s best interest, both fiscally and from a quality of life perspective.

The town’s website lists all of the development and redevelopment projects in the pipeline. Adding up all those that have been approved already (and some are under construction as I write this), Chapel Hill will soon add 3,274 new residential units. Another 2,941 are under review, in the concept plan phase or planned but on hold. A total of 6,215 new units, and that does not include Central West.

Former Planning Board chair Del Snow compiled the numbers for an upcoming Planning Board meeting. The list also notes more than 2 million square feet of retail planned, though at a recent presentation to the Chapel Hill Board of Realtors, the town’s economic development officer, Dwight Bassett, predicted a demand for retail space of only half that by the year 2020, with another million square feet of demand for office space.

To succeed, a store needs about $250 in sales per square foot on average. That means shoppers will need to spend about a half billion dollars a year (yes, that’s billion, with a B). That seems like a lot of shopping to me, though with a new movie theater charging $16 a seat, maybe Chapel Hillians are up to the task.

The chart also shows more than 2 million square feet of office space planned. With an absorption rate of 70,000 square feet per year, that’s a 30-year supply. Again, this does not include any expected development in Central West, nor does it reflect current vacant space.

Some town leaders may adhere to the “if we build it, they will come” philosophy. And to avoid Chapel Hill becoming a ghost city like those in China, I hope they’re right. I also hope someone on staff has calculated what it will cost taxpayers in infrastructure and services. Let’s make sure we know how much it will cost us to grow.
– Nancy Oates

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13 Comments

  1. DOM

     /  February 10, 2014

    Just say no.

  2. Gregg Gerdau

     /  February 10, 2014

    What about the impact of 6,215 new residences on our schools? Have those costs been calculated? The schools we have are poorly maintained, according to the teachers who work there every day. Notwithstanding teacher dissatisfaction with their pay, what will adding more schools and teachers do to the double school tax bill we pay now? Seems like far too many unanswered questions for rational council members to make these decisions now.

  3. DOM

     /  February 10, 2014

    Yes, might as well stop any progress before we get any further behind.

  4. Deborah Fulghieri

     /  February 10, 2014

    Greg Gerdau:
    The Planning Board did ask this question, but the Town of Chapel Hill is a separate public entity from the school district. The town does not communicate directly with the school district and does not consider school issues in its decision-making. It is up to the school district to react to Town development decisions. Steve Scroggs told a group of us 10 years ago that he went to Town Hall regularly to look through the pile of paper building permits to figure out how many more students might be in the district the following semester. Nancy Oates wrote a few months ago that Orange County’s tax assessor also must personally “rifle through a binder in Town Hall to read the accumulated paperwork,” a system which costs the county, the school district, and the Town itself more than anyone knows, although Nancy discerned tens of thousands on 3 small properties, over a span of just 2 years. http://www.chapelhillmagazine.com/topics/nancy_oates/

    Fire, police, waste and public works have to expand, in addition to the school district, and no one can say that the costs have been studied.

  5. anonymous

     /  February 10, 2014

    it’s pretty simple, since most of the property taxes city residents pay go to the schools, developments that don’t add kids will probably help the tax “burden” – developments that add more kids will probably not… sales tax also helps but is probably less important than not needing more school slots

  6. many

     /  February 10, 2014

    Taxes are only reliably paid when the space is occupied, The combination of absurd projections from the MPO and low interest rates seems to have created a perfect storm of speculation.

    Just as important as stimulating, planning for and enabling quality orderly growth; It is incumbent on the town planning department and leadership to recognize over-speculative conditions.

    Chapel Hill is lucky to be able to pick and choose. Let’s hope we choose wisely.

  7. Bruce Springsteen

     /  February 11, 2014

    I’m reminded of a scene from the 80s sitcom Night Court. It’s been a long time but my rough memory is this. Bull the Bailiff rented the concession stand space and started charging $975 for a candy bar. The others said, “Bull, at $975 you’re going to have a hard time selling candy bars to pay for this space you’re renting.” Bull replied “Yeah, but at $975 I only have to sell one.”

    That’s Chapel Hill. Eschew the merchants that survive by selling a high volume at a low profit margin and instead encourage the merchants that survive by charging more for “luxury” items at a larger margin. And that drives up the cost of living and therefore the cost of what “luxury” is, and then it all snowballs.

    Eventually we’ll have a movie theater where tickets are $500 million but it’ll work out okay because after all, we’ll only have to sell one.

    Past experience tells me that whatever retail businesses they bring in won’t appeal to the masses. The biggest beneficiary of Obey Creek will be the nearby Wal-Mart.

  8. Don Evans

     /  February 12, 2014

    The Town Council doesn’t seem to be choosing wisely — any developer who walks in with a plan seems to have its backing

    Developers are willing to tell the council anything to get approval for their plans, then they change the plans as they wish after they’ve played the council. And why not — they look to make huge profits and then walk away from the increasingly burdened community that they have no stake in.

    Not sure who’s looking out for the well-being of the community — it sure ain’t the developers and sure appears as if the council ain’t either!

  9. Yes we seem in a great hurry to become a City yet many of the people I know moved here to avoid living in one. It does not help when Council members raise really good questions about the financial basis for what staff is recommending and the answers from the staff are anything but clear. The Town is making decisions without a strong underpinning of factual information.

    A couple of examples: Dwight Bassett, in a presentation to the Chapel Hill Board of Realtors, showed a powerpoint indicating that up to 1 million square feet each of retail and office could be supported by 2020. What will happen to all this excess? Dwight is in charge of the giant E-F redevelopment plans and he tells everyone who will listen that there are a few big redevelopment projects within that will pay for everything. Yet there are no numbers released to show that revenues will exceed expenses when schools, fire engines, and new busses are factored in. While everyone is in favor of road improvements and redevelopment at Rams and environs nearby, it boggles the mind that the Town would undertake this amount of development without that factual information that it will benefit the Town. I’ve discovered a report of the use of the brand new mechanism – form based code. There are many types of form based code which have shown some success in NC cities. I learned that public participation need not be removed from the process. The other striking thing about this report is that in most places regulatory boards review to make sure the developers follow the adopted code. Not so here. Just the Town Manager! Here is the link to Boyer’s report: http://www.mpa.unc.edu/sites/www.mpa.unc.edu/files/MatthewBoyer.pdf

  10. David Schwartz

     /  February 13, 2014

    Anonymous wrote:

    “It’s pretty simple, since most of the property taxes city residents pay go to the schools, developments that don’t add kids will probably help the tax “burden” – developments that add more kids will probably not… ”

    I think we can confidently predict that most of the new households will add kids—people move to Chapel Hill primarily for the schools. Households without school-aged children can get much more house for the money by purchasing in Durham, Raleigh or out in the county. Developers’ assurances that only empty nesters and childless professionals will be interested in the new housing units are pure hokum. Therefore, we can confidently predict that the addition of 1,000 new housing units will increase current residents’ tax burden.

    By all means, let’s spiff up some of the existing retail and multifamily housing in the Ephesus-Fordham area, build something useful in the pit that used to be the Plaza Theater, and remedy existing traffic and storm water problems, but letting developers and their lackeys write the regulations to govern future development—without public input!—is tantamount to hiring the fox to guard to hen house.

  11. If “broadening the tax base” can result in lower taxes, then New York City would be the cheapest place to live. The only thing good I’ve found since learning about all of these urbanization plans is that they’ve awakened me from a lifetime of apathy about local politics. It’s also improving my web publishing skills as I try to document what I’ve learned about the Ephesus-Fordham project. That can be found at http://home.roadrunner.com/~kenlarsen/PoliticsChapelHill.htm Thumbs down to the urbanization of Chapel Hill and the Council members who support it.

  12. Emily Lees

     /  February 14, 2014

    Ironically, the little Town that wants to become a major urban area characterized by high rise density doesn’t seem to grasp that building an urban cluster here (Ephesus-Fordham), another there (MLK and Estes), and yet another down the street (Obey Creek) does nothing to create a vibrant urban core with destination walking and mass transit. Assuming that the new apartments and condos do actually attract residents, the newcomers will be driving the same overcrowded streets as they go from home to work to entertainment. It is naïve to think that significant numbers will live, work, and play in the same cluster of vertical sprawl.

    The Town has not promised to do anything to address the problems it is planning to create. But at some point, these problems will need to be addressed. We will need new transit and improved roads. According to the National Multi-Housing Council, nationwide, 76% of apartment dwellers own cars, and a larger percentage — 84% — living in newly constructed apartments do. Although, granted, this number is lower than the percentage of car owners living in single-family homes, true major cities such as New York, where rapid transit is readily available, contribute to the number of apartment dwellers.

    And this is even assuming that the residents do come. We do not live in a vacuum, and it remains true that the cost of living is cheaper in Chatham and Durham counties. The American dream is still that of individual home ownership, and many potential residents may choose to move to the huge new development being proposed for Chatham County or to one of the myriad neighborhoods already across the county line.

    So not only are residents of Chapel Hill being asked to accept seeing a town that is prized nationwide for its beauty turned into one pocket of vertical sprawl after another, we are being told that the Town wants to give the decision to approve such projects to one man. No accountability to the taxpayers who will ultimately be asked to pay the price. No accountability to the elected town officials who are supposed to represent the interests of those taxpayers. We will be the ones dealing with overtaxed infrastructure if the projects are successful and empty storefronts and apartments, likely to attract crime, if they are not.

  13. DOM

     /  February 14, 2014

    Just say no EVERYWHERE.

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