Streetsblog Los Angeles

The $8,000 tax credit for new home buyers -- which was wracked by fraudulent claims after its creation as part of the nation's economic recovery effort -- is on the verge of a significant expansion by Congress.

Just how much will the tax credit mushroom thanks to the deal reached in the Senate? As the New York Times explains, it's time to take the "new" off of the credit's name:

The homebuyers’ credit ... would be extended to cover homes under contract by April 30. Also, it no longer would be limited to first-time buyers; people who have owned a home for at least five years could get a $6,500 credit on a new residence. Income limits for eligibility would be raised, making many more people qualify.

Extending and expanding the credit would cost an estimated $11 billion, on top of the $10 billion spent so far.

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One of the themes of the financial and economic crisis we’ve faced
over the past two years is that government, pressed into responding to
serious economic pain, has often found itself supporting the activities
that got us into this mess in the first place.

Sign of the times? Sde-by-side foreclosures in Massachusetts. (Photo: Yovani via Flickr)

Irresponsible
behavior by banks led them to the brink of collapse — a collapse which
would have sent the global economy into a terrifying period of decline
– and so the government stepped in to prevent bank failures (after
learning a lesson from the dreadful experiment with Lehman). But these
interventions have put banks in a situation where they stand to gain
enormously from taking large and dangerous financial bets.

Similarly, government policies such as low gas tax rates and
import protections on light trucks encouraged the development of a
bloated domestic auto industry focused on the production of inefficient
SUVs.

When high oil prices and deep recession then
threatened to push General Motors and Chrysler into bankruptcy, leading
to hundreds of thousands of lost jobs, the government felt it had no
choice but to step in to keep the companies afloat.

Now the
government owns large stakes in companies that will only profit if the
American public goes car-buying crazy over the next few years.

The
list goes on. The economic crisis that currently afflicts us has made
it clearer than ever that we need to change the way we do many things,
but because the economy is in such difficult shape, it is hard to
pursue anything other than policies designed to keep the economic
engine from stalling out completely. Big transitions must wait for
later.

Can the same be said for sprawling urban development?
Have government interventions essentially bailed out the very places
that proved most vulnerable amid oil shocks and housing busts?

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Experience with case studies has made it clear to many urban
planners and environmentalists that to maximize the benefits of transit
investments, and to slow growth in traffic congestion, vehicle miles
traveled (VMT), and carbon emissions, you have to focus on land use.

Photo: Penn State.

This
knowledge has begun working its way into the policymaking world, to the
extent that local and state legislatures are beginning to craft rules
that explicitly factor the carbon impact of land use effects into
decisions about new development and infrastructure construction. In a
few years time, the federal government may follow.

But there’s not as much in the way of hard studies of the
effects of land use as we might like — mainly because it’s been a
non-issue, so far as most of the country is concerned, for much of
recent history.

Aiming to address this (and acting under a
congressional mandate), the Transportation Research Board recently
completed a study that has now resulted in a very large report: "Driving and the Built Environment: The Effects of Compact Development on Motorized Travel, Energy Use, and CO Emissions."

The
report is actually five mini-papers, and at nearly 200 pages long it
makes for a lot of reading. But the findings reported in the
introduction give an idea of what it’s all about.

The authors
conclude that compact development is likely to reduce VMT: "The effects
of compact, mixed-use development on VMT are likely to be enhanced when
this strategy is combined with other policy measures that make
alternatives to driving relatively more convenient and affordable." No
surprises there.

Finding No. 2 is: "The literature suggests
that doubling residential density across a metropolitan area might
lower household VMT by about 5 to 12 percent, and perhaps by as much as
25 percent, if coupled with higher employment concentrations,
significant public transit improvements, mixed uses, and other
supportive demand management measures."

They note that were
you to move the residents of Atlanta to an area built like Boston,
you’d lower the Atlantans’ VMT per household by perhaps 25 percent.

Better
land use results in reductions in energy use and carbon emissions, the
authors report, from both direct and indirect causes. (Direct causes
would be a reduction in VMT; indirect include things like longer
vehicle lifetimes from reduced use and the greater efficiency of
smaller or multi-family housing units.)

But one of the crucial pieces of data included in the report is this:

As
many as 57 million new housing units are projected to accommodate
population growth and replacement housing needs by 2030, growing to
between 62 and 105 million units by 2050 – a substantial net addition
to the housing stock of 105.2 million in 2000.

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