Breaking The Silence
May 13, 2005 | Life | People & Society
I've been self-employed for ten years, and in that time I've written exactly zero letters to the editor of our local paper. Too much chance of annoying a potential or existing client. But last week something in the business section really stuck in my craw, and I wrote a letter. This morning at 8:30 I received a voicemail from a random reader thanking me for thinking that way and taking action. So I guess they printed it. Though I don't know what was edited, here's what I submitted.
Editors,
Your lengthy and reasonably balanced story from Sunday, May 8 titled "Battling the Regulatory Bottleneck" provided some interesting perspective on how we think about housing and government.
As reported, the average price of homes at the new Prospect Hill development will be $250,000 to $400,000. Had there been no "regulatory bottleneck" there would have been "some" houses affordable for families earning less than $70,000 per year. Whether there would have been two, 20, or 130 of these affordable homes, and what their price might have been, we do not know.
An important fact comes at the very end of the article: The regulatory approval process for Prospect Hill cost $225,000. And the penalty: "All of those expenses will be reflected in the sales prices of the homes, [the developers] said."
$225,000 sounds like a lot of money, but let's do some math. With 170 houses approved, it's only $1,324 per house, about one-half of a percent on a $250,000 house, or one-third of a percent on a $400,000 house. That $1,324 is put into a 30-year mortgage for an annual cost of approximately $44.
Now, tell me again, why are these houses are going to cost a third of a million dollars? It might be because of land cost, or maybe due to materials cost, or perhaps labor cost, and let's not forget the "cost" of developer profit - but it's certainly not due to the cost of $1,324 for regulatory approval. The headline of your article could be accurately written as, "Developers: Delays boost prices over half a percent!"
Let's not try to blame the lack of affordable housing on the public review process. I am happy to pay $44 per year for this public good. If instead I wanted to live where no one cared about protecting natural beauty I could find a cheap place in Houston Texas.
Comments
Hi, Michael,
Thanks for doing the math! I'm in Lebanon, and I too am "happy to pay $44 for the public good". But I'm betting that the additional **direct** costs aren't what drove the cost up. It was undoubtedly all the additional requirements that the town put in place during the process. I have a friend who went through the Lebanon regulatory process for a small, really innocuous office, and he was AMAZED at the level of detail the Lebanon reviewers went into. Right down to which shrubs and where. It was much more invasive and protracted than any of the other towns in the area, including Hanover. Having been through a very constructive review process in Hartford for our church, it does seem to me that the process can be proactive and thoughtful and raise all the necessary issues, without having to be so onerous. I've heard others speak of the process with dread, as well. I would definitely think twice before undertaking any project that would need to be submitted to the Lebanon review boards. Anyway, my husband mentioned he saw your letter in the paper this morning, so I'm tickled to not have to get out of my desk chair to read it! Have a great day.
Posted by: Pat Langille at May 13, 2005 02:56 PM
Or try Dallas.
Posted by: Tutor at May 13, 2005 09:48 PM
