The Economic Case for Carfree Development
Gus Yates CarFree City, USA www.carfreecity.us Why Carfree?
Typical American Development
10 miles
Home
Work 2 miles 8 miles
Shopping What is Carfree?
Carfree areas are compact, mixed-use developments designed for pedestrians, where people can conduct their everyday activities without having to be in or around cars. Carfree Highlights
• A type of transit-oriented development (5-minute walking radius from major transit station) • No cars and few trucks within this neighborhood • Narrow streets, irregular grid, plazas • Large greenspace around periphery • Located in existing metropolitan area (brownfield or grayfield) • Peripheral parking garage (for trips outside district not practical by public transit) Carfree Reference District
Streets and Plazas
Buildings
Courtyards and open space
¼ mile radius Reference District Parameters
Carfree District Assumptions
Area
Developed 112 acres
Large greenspace 88 acres
Total 200 acres
Population 12000 people
Dwelling units 4,600 homes
Average building height: 4 stories
Developed area floor-area-ratio 1.4 ratio
Shopping, health, recreation, etc. space 1,164,000 square feet
Office/school space 2,328,000 square feet
Workplaces 8,000 workplaces
Household annual driving 5,000 miles per year
Impervious area 69.0% percent of total area
Parking spaces per dwelling unit 0.2 spaces per DU
Land value $3,049,200 dollars per acre Approach
• Itemize and quantify economic net benefits
• Neighborhood scale of analysis
• Evaluate methods for internalizing net benefits Quantitative Net Benefits
Decreased costs for:
• Car crashes • Health effects of obesity and overweight • Air pollution and global warming • Household transportation • Infrastructure • Land for parking • Home heating • Regional roadway and health care capacity • Oil wars Qualitative Benefits
• Less time spent driving and chauffering • Independent mobility for children • Independent mobility for older adults • Quiet, peaceful environment • Safe places for kids to play • Attractive parks and plazas • Aesthetic outdoor dining • Spontaneous social interaction = “Lifestyle” Who Benefits
City or Category Developer Residents County World
Quantitative
Increased benefits P P P P
Decreased costs P P P P
Qualitative
Increased benefits P P P P
Decreased costs P P P P Economics 101
Economics 101
What are we comparing carfree to?
A. Other patterns of development
B. Alternative future conditions:
Future A
Past Present Future B Economics 101, continued
Analysis concepts:
• Internalizing externalities
• Economics versus finances
• Present value of net benefits Car Crashes
Car crashes are the leading cause of death in the U.S for people ages 1-24 3 Fatalities and injuries from car crashes cost the U.S. economy $200 billion per year 3 Car Crash Savings
•Car crash exposure 75% less for carfree residents •Per-capita avoided costs $500 per year •Savings for entire carfree district = $6.1 million per year Obesity Obesity and physical inactivity:
• Shorten lifespans 5
• Are surpassing smoking as the leading preventable cause of death 1,4
• Cost $262 billion per year in health care and lost productivity 1,4 Savings from Fitness
$650-$900 per year per person $8.1 million per year for a carfree district Air Pollution and Global Warming
Air pollution costs billions of dollars each year •Respiratory illnesses •Crop damage •Ecological disaster Transportation Pollutants
Transportation Percentage of Total Emissions
90 80 EPA "Criteria Pollutants" Global 70 Warming 60
50 40 P e r ce nt 30 20
10 0 CO NOx ROG PM10 Pb SOx CO2 Emission Offset Credits
Economic value of reduced emissions: ($ per household per year)
NOx $320 ROG $54 CO2 $15
$1.3 million per year for a carfree district Household Transportation Costs
The average American household spends $7,630 per year on driving 6
This equals 15-22 % of household income 6 Household Transportation Savings
Annual Household Expenditures
$8,000 $7,000 Public transit $6,000 Automobile $5,000 $4,000 $3,000 $2,000 $1,000 $0 U.S. average Carfree
Annual savings of $4,950 per household
$22.7 million per year for carfree district Infrastructure Costs
Road, water, sewer and stormwater infrastructure costs 10 times more per household in sprawling subdivisions than compact urban development 10 Infrastructure Savings
Savings for a carfree district:
Streets $22 million
Water, sewer, &drainage $62 million
Total $84 million Parking Costs
30%-40% of a typical American downtown area is dedicated to parking 11
Cars spend 96% of the time parked 7 Parking Savings
Savings for a carfree district: Land area $270 million -Peripheral parking garage -$29 million Total $241 million Qualitative Benefit: Time Savings
The average American spends 66 minutes per day driving 7
46% of all trips are for errands or to chauffer family members 1 Summary of Annual Benefits
Annual District-Wide Savings
$25,000,000 Total = $38 million
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$0 Obesity Car crashes Air pollution Household transportation costs Present Value of All Benefits
Total = $915 million
Present Value of District-Wide Savings (5%, 30 years) 400 Total = $915 million 350
300
250
200
150 Milli on D o ll a rs 100
50
0 Obesity Car Air Household Parking Infrastructure 1 2 3 4 5 6 Crashes Pollution Transportation Expenses Who Benefits
City or Category Developer Residents County World
Car crashes P P
Obesity P P
Air pollution P P P
Household transportation P
Infrastructure P P P
Parking P P P Internalizing Net Benefits
Benefit: Car crashes and Obesity
Naturally accrues to: Residents
Internalization methods: • Discounted group health plan • Discounted life insurance plan
... Both based on actuarial statistics related to fitness and annual miles driven Internalizing, cont’d
Benefit: Air pollution and global warming
Naturally accrues to: • Residents • City or county • World
Internalization methods: • Payments to developer from Air Resources Board for mobile source emission reduction • Payments to developer from carbon offset credits sold on Chicago Climate Exchange Internalizing, cont’d
Benefit: Decreased household transportation costs
Naturally accrues to: • Residents
Internalization methods: • Location efficient mortgages (higher loan- to-value ratio) • Greater ”willingness to pay” for home sales Internalizing, cont’d
Benefit: Decreased infrastructure and parking costs
Naturally accrues to: • Developer
Internalization methods: • None needed • Possible bonus from city/county for decreased infrastructure O&M costs CarFree City, USA
www.carfreecity.us Citations -1
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8. Surface Transportation Policy Project. 1999. High mileage moms.
9. USDA. Cited on Surface Transportation Policy Project website(www.transact.org). Note: Slightly smaller figure in February 20,2003 issue of Environmental Defense newsletter, p.5: "more than 25 million acres of rural land" were been developed between 1982 and 2003 (= 1.2 million acres/yr). EDF did not reference the statistic.
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11. Gibbons, J. 1999. Parking lots. Technical Paper No. 5. Nonpoint education for municipal officials. University of Connecticut. Haddam, CT.
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14. Holtzclaw, J. January 15, 1991. Explaining urban density andtrasity impacts on auto use. Natural Resources Defense Council, San Francisco, CA. in California Energy Commission, Docket No. 89-CR-90. Citations -3
15. Holtzclaw, J. 1994. Using residential patterns and transit to decrease auto dependence and costs. Natural Resources Defense Council, San Francisco, CA and California Home Energy Efficiency Rating Systems, Costa Mesa, CA.
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