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June 12, 2001

Host: Michael Grant
Topic: Growth
In-Studio Guests:
Craig Ahlstrom, President and CEO of Sunland Springs Village in east Mesa. Mr. Ahlstrom is President of the Mesa Chamber of Commerce and serves on Mesa's Citizens Advisory Board in charge of updating that city's general plan.
Dr. Joan Kelchner is an emergency room physician and past President of Roosevelt Action Association in downtown Phoenix. Dr. Kelchner also a member of the Phoenix Planning Commission.
Bill Lipscomb is an Air Crew Life Support Superintendent at Luke Air Force Base, lives in Surprise. Mr. Lipscomb is Co-chair of the West Valley Alliance and serves on a number of Dysart Unified School District committees and boards.
Taped Guests:
Karen Firestone/Gilbert Resident
Jeanne Klimek/Mesa Resident
Marilyn Persson/Central Phoenix Resident
Mark Ruben/Chandler Resident

 

MICHAEL GRANT: "Good evening. Welcome to Horizon’s Community Roundtable.I'm Michael Grant. It's the sound that's come to symbolize growth in the Valley of the Sun. New census figures show Maricopa County's population topped 3 million people last year, an increase of 45% from 1990. Tonight a panel of community leaders talk about the impact of growth both positive and negative. What role impact fees should play in new construction, and the backlash against building huge superstores.

Joining me on tonight's "Community Roundtable" is Craig Ahlstrom, President and CEO of Sunland Springs Village in east Mesa. Mr. Ahlstrom is President of the Mesa Chamber of Commerce and serves on Mesa's Citizens Advisory Board in charge of updating that city's general plan. Dr. Joan Kelchner is an emergency room physician and past President of Roosevelt Action Association in downtown Phoenix. Dr. Kelchner also a member of the Phoenix Planning Commission. Bill Lipscomb is an Air Crew Life Support Superintendent at Luke Air Force Base, lives in Surprise. Mr. Lipscomb is Co-chair of the West Valley Alliance and serves on a number of Dysart Unified School District committees and boards.

Growth is frequently identified as the top issue facing our communities, yet people's opinion on the issue is mixed. Here's a sample."

Karen Firestone/Gilbert Resident (on videotape): "It just takes away, I think, from how Arizona is and wants to stay kind of maybe a farming community and it's becoming more metropolitan, which is good. I think Arizona wants to be recognized as that, but it takes, again, away from family atmosphere."

Jeanne Klimek/Mesa Resident (on videotape): "Around the orange groves I see them going, which is a little upsetting because they're going with subdivisions and that's more people, and so that concerns me a little bit.

Marilyn Persson/Central Phoenix Resident (on videotape): "The only problem I have with any type of growth is the mountain preserves. I want to be able to see the mountains, but there is enough room throughout the Valley that there's enough room for everyone, and it does create jobs. So I think growth is a good thing."

Mark Ruben/Chandler Resident (on videotape): "Fast growth is good, but it's -- can work in a negative way, to me, I think, in the future, due to the fact they don't plan it properly. It's not planned properly, to me."

MICHAEL GRANT: "Craig, people a little schizophrenic sometimes about the issue of growth? Do you find that?

CRAIG AHLSTROM: "Yeah, just as the opinions expressed on this opening clip, it goes from people say the planning is not good all the way to, hey, let's have some more growth and preserve certain areas. There's not a cut and dried answer for the particular question."

MICHAEL GRANT: "Joan, I know one of the things that you hear most frequently is, ‘hey, I moved out west, I moved to the Valley to get away from, you know, people stacked on top of each other, and, yeah, gee I don't like being stuck in traffic jams and I don't like the sprawl but I don't want it more dense, either.’"

JOAN KELCHNER, M.D.: Actually, I grew up in Denver, but I am a native westerner, and I'm well aware of the sentiment that everybody's supposed to have their own house, you know and their own land and their own space and yet at the same time, particularly in the west, every poll we take, every survey we take, says people wants to save the open space, they want the preserves, they don't want people building on the mountains, they don't want to go too far out in the desert and they consider it a very serious problem.

At this point, a lot of people are talking about what we call the new urbanism, trying to move downtown. There is -- though it's schizophrenic, we have got a good solid core, a seed of people who are willing to talk about density, you know, the bad word density. Let's move back downtown. Look at houses that are a little closer. Look at different lifestyles. Maybe townhomes or condominiums or patio homes in order to preserve that other space out there."

MICHAEL GRANT: "Now, Bill, does the west side see growth a little differently? I mean, if you want to sprawl this way, ok by us?"

BILL LIPSCOMB: "I don't think it's ok by a lot of people over there. I think they are greatly concerned at the speed of the growth out there, particularly I'm from the surprise area, which I think by the record is about one of the fastest growing cities in the state."

MICHAEL GRANT: "Supposed to be 250,000 people, I think, in the next 20 years."

BILL LIPSCOMB: "That's correct. So that really scares a lot of people that. I've been fortunate to have been involved in the general plan update, that program since its inception about June of 1998, been at those meetings and I've seen a convergence of many people that are greatly concerned about losing of the open space and those general things where they can't see the mountain any more."

MICHAEL GRANT: "When they say -- I was just going to ask that, when they say losing the open space, what do they really mean by that? Do they mean something like a Phoenix mountains preserve, I don't want people building on the mountains, or do they mean I want more parks?"

BILL LIPSCOMB: "Certainly. There's a combination of that. One of the first things that has occurred to me by talking to the people out there in many of the workshops is, first of all, everybody that has purchased a home in those general areas right now, they wish everything could stop right now. And, of course, everybody that lives out there is a NMBY, not in my backyard concept."

MICHAEL GRANT: "I'm here, slam the door."

BILL LIPSCOMB: "Yea, I have my house and this type of thing. But that's not realistic. But what I think is realistic is to do some real proper planning so that you can maintain those views, the scenic vistas, proper planning as to where you can actually maintain those things, and enhance those.

I would also say that I used to be for no density, low density and it was -- I was always that way until I returned from two years in Italy. And when I came back, it altogether changed for me. Because I lived in high density in Italy and I loved it, and I came back and I said, you know, density in this state really has gotten a bad rap. I think we need to go back and say, you know, we can really use mixed zoning the way that prior to World War II actually, generally – it was scripted from the European development of villages and towns where you had the central point. But after the FHA and VA trying to build the homes for all the soldiers and everybody coming back, it just went back to what we have.

CRAIG AHLSTROM: "There is room for all of that. I think balance and moderation, that has to kind of be the key. There's those that want to move downtown. There is a certain core group that want to do that. There's a certain core group that say leave it the way it is here. Then there's others who want to spread out a little bit.

I think with the new planning tools, growing smarter, that have been put into place now, we have -- Arizona has probably the toughest planning tools of any state, maybe California…"

JOAN KELCHNER, M.D.: Legislatively, anyway."

CRAIG AHLSTROM: "Yea, as mandated. But we are on the cutting edge of how we're going to plan the future for this state."

JOAN KELCHNER, M.D.: "You know, Phoenix put their first general plan out in 1985, and one of the first things they did was they divided the city into what we call the villages. At that time there were nine villages, I believe. There are 14 now. And the whole concept of the village is to allow for that diversity at the center of each village should be a core that's more dense with more commercialism, more jobs, and as it goes out from the core, there should be less and less dense with more single-family homes and it goes into the next village."

MICHAEL GRANT: "Joan, but for a long time we have been, I think, writing this infill -- riding this infill horse and I know there have been isolated things that have happened that I would submit to you that over the past 20, 30 years they have really been isolated. It hasn't seemed to really happen. Is that because you've done it badly or because people don't like it?

JOAN KELCHNER: "No, because people are just coming into it, I think. We started this village concept and it was a brand-new concept, it took a lot of people to get around to see what that meant and then get all the citizens involved on all their committees and then start to get into other planning things. It was really the downtown area, anyway, the central city, that said this is where we really need to be dense. These were neighborhoods originally that people walked in, that had your retail half a block away so you could walk back there and back because people didn't have cars in 1910 and 1920. This is where we want to see that back again. And because of the Highland prices and a lot of other factors, this is where we are going to see increased density. This is writ started out but with other things going on, people in the periphery are beginning to see that and one of the ways that we're going to have to deal with growth and I think everybody recognizes this, is the opposite of going out, and that's the coming back in. That's the infill.

CRAIG AHLSTROM: "I don't--I think Phoenix lends itself to that village concept. You get newer communities on the west side or the east side, the Chandlers, Mesas, Gilberts, they don't have that village concept …"

MICHAEL GRANT: "Tradition?

CRAIG AHLSTROM: "Exactly.

JOAN KELCHNER, M.D.: "And they are smaller to begin with in population."

CRAIG AHLSTROM: "So, they have that opportunity to develop their downtown areas and so forth, but at the same time, the opportunity exists with the planning tools in place to develop beautiful communities, master planning process with a lot of open space that allows the views and vistas at the same time -- you know, the real key is, a balance between how much open space can you have that's not going to drive the housing prices up, which comes to an affordability issue that's just really critical in Arizona.

MICHAEL GRANT:"Bill, we've touched on the 10-year plans a couple of times. Do people get excited about a 10-year plan? And by that I mean, just the general John and Jane Q. Citizen. Can they really get engaged too much about the math and somebody's concepts?

BILL LIPSCOMB: "Well, I wish they would. It's extremely important. But what I have experienced is not very much, and I think much of the reason is that people really feel they have no power over the system, and even though we've had the general plan updates where it was open to the public, it doesn't work out as well as designed. I think too many times there's too many planners that are involved in that process that really mold and shape the thing versus what I think the people are really striving for.

MICHAEL GRANT: "A top-down instead of a bottom-up?"

BILL LIPSCOMB: "It's really a top-down, and I think what would work properly is to have the people really sit down without the planners really involved in this process necessarily until they can come back in and then sort of mold it a little bit more."

JOAN KELCHNER, M.D.: "I think part of this is an education issue. When we started to get people involved on citizens committees like the village planning committees, they begin to become more aware of something like the general plan and became a lot more involved. Now, sitting on the planning commission, I can assure you that people who may not have known about a general plan before have something – a development they don't like is going to come in a block away from them, they certainly discovered it, you know, very quickly…"

MICHAEL GRANT: "Oh, absolutely. No argument there. But, Craig, at least my conception is on most general plans is that they're too abstract. I'm not being critical of them in that respect, but until that actual proposed development a mile from you is sort of hard reality, people have a hard time getting jazzed by the plan.

CRAIG AHLSTROM: "That's true. I can see that. But at the same time, the general plan is a guide. You can't have it too tight or too restrictive because you have to be able to roll with the times. You've got to be able to make the changes, and especially now with the new Growing Smarter legislation, if you come in with a general plan that is so restrictive and a developer or an association wants to change an aspect of that plan, you know, it goes into a vote of the community, and we don't know how that's going to come out, when you're having a community like Mesa, 400,000 people, voting on a land use change, that's going to be…"

JOAN KELCHNER, M.D.: "That's going to be scary.

MICHAEL GRANT: "Speaking of -- well, maybe scary things, a majority of Valley cities offset the cost of growth by assessing impact fees. Morrison Institute at ASU reports Peoria charges the most for single-family homes in the northwest part of the city at $13,288 per single-family home. Phoenix is second at $12,400 for homes built in the northern part of the city. Phoenix also charges zero impact fees for homes built in older parts of town. Two communities, Carefree and Litchfield Park, do not charge impact fees. Average impact fee Valleywide, $5500.

And that is one of the big issues, Bill, is what's the right size for an impact fee? Should an impact fee truly charge the homeowner for the impact on their growth? If that's $15,000, should they be charged $15,000?

BILL LIPSCOMB: "Yes, I think so. For growth to pay for itself, in other words, if you have a new division or subdivision that's going in, there's -- the people that desire to move there, to purchase a home there, make a decision to do just that. But that development has an impact. It has -- wide ranging impact, either with on -- width on the roads, the water, the power and all those infrastructure needs that are essential to a new development out there.

Without -- and, again, when they say development fees or impact fees, they sometimes use those terms the same, but still, that is simply a transfer of costs because the developer will, of course, tag the increased price for the development fees onto the purchase price of the home. So, therefore, it's going to go to the individual that's going to buy the home. Now, if the individual -- because the -- let's say it's a $100,000 home and you mark it up $10,000 for a development fee, so it's $110,000. Well, either the people can afford to purchase a home and pay for the impact that they're actually causing within the community of whatever it happens to be, its infrastructure availability, or they can't. If they can't afford that $110,000 home, there is no impact upon them necessarily."

CRAIG AHLSTROM: "And it all sounds good and well, but those impact fees are not only for wastewater and storm water and water. Those go for police and fire and library and cultural, and those people, new people moving into the area, they don't have any more impact on the community than a person moving into an older neighborhood.

Phoenix there has zero impact fee for older neighborhoods, but if a family from California moves in there to the older neighborhood, they have just as much impact…"

JOAN KELCHNER, M.D.: "That's not necessarily so.

CRAIG AHLSTROM: "They have just as much impact on the library or on police or fire as someone moving into the new area."

JOAN KELCHNER, M.D.: "But in Phoenix, the impact fees are actually different in different parts of the city. They're higher up north where the new growth areas are.

A little bit less in the west and in Laveen and Estrella and there is a partial fee for Ahwatukee. There is nothing in the center of the city, number one, the center of the city has the infrastructure in place, including enough libraries and parks and fire and police and everything else, which they don't have on the periphery…"

CRAIG KELCHNER,M.D.: "But doesn't a new family impact the library?"

JOAN KELCHNER, M.D.: "We're trying to encourage this infill as part of our solution to growth. Rather than growing out and overgrowing, leap frogging, causing the kinds of problems with long commutes and growth out there, we're trying to bring people back in. So it's the opposite…"

MICHAEL GRANT: "Bill, isn't this another form, though, of what we were talking about earlier, ‘Hi, I'm here, slam the door.’ When I moved into Northern Avenue, you know, I was putting the burden on the people on Camelback and Roosevelt, but, I mean, there was a general feeling, well, welcome aboard, all that kind of thing. But now that we're out beyond Moon Valley and to Surprise and those kinds of things, we're saying, hey, $15,000."

BILL LIPSCOMB: "I -- I feel that the necessity for the development fees, those need to be primarily absorbed by the new people that are coming in there. Again, just by looking at what is it exactly that that subdivision, those people are actually going to impact? Let's study the actual impact of that decision. Now, for instance, if it's going to impact upon the roads, how many roads are available out there?

The thing that has always been a passion of mine was the impact upon the school system out here because in our general area and I think this is statewide, but where

I'm at, the Dysart Unified School District, they were hit very, very hard, and even though there are statistics showing they were going to maybe go about 8% increase, well, they've gone close to 13%, and so they're scrambling. They're always scrambling to build the schools and try to get the schools up and running and acquire the teachers that are going to teach the classrooms. But what Apache Junction did a couple years ago was they imposed the impact fees, as they call it there, to help subsidize the cost of building construction of the schools, and, of course, the Home Builders Association of Central Arizona didn't like that too much, and they took it to court, and even though they won on the first go round, they lost on the Supreme Court ruling on that. So Apache Junction has to repay that dollar amount."

MICHAEL GRANT: "Craig – go ahead."

CRAIG AHLSTROM: "I was just going to say, the -- the Supreme Court has ruled that it's not the responsibilities of cities and towns to pay for school funding, for school at that point funding. That's the responsibility of the legislature, it's the state constitution, and the legislature's responsibility to do whatever they need to do to make sure that the schools are funded properly, that the Students First group is doing that. So the mechanisms are there and, again, it's against the constitution of the state, and so if there's going to be a change in that particular funding, you know, there needs to be a change in that."

MICHAEL GRANT: "Seems to me that you get into an awful lot of constitutional issues here, and they load up in the classic sort of private property rights…"

CRAIG AHLSTROM: "One point was that it sometimes is a myth the development community doesn't pay for itself. You know, every time a developer goes in and does a subdivision or a community, you know, they pay for every road, every street, every streetlight, every sidewalk, everything and all the arterial streets adjacent, they pay for every penny of that."

MICHAEL GRANT: "Well that’s true, but they are having some broader impacts."

JOAN KELCHNER, M.D.: "But they don't play for water treatment plants which are operated by the city of which we only have like three, or the water mains to bring down the water to the city to begin with. They don't pay for the sewer system, which they plug into. They are paying for only part of it.

CRAIG AHLSTROM: "And those fees are in place to pay -- by the city property taxes and sales taxes…"

JOAN KELCHNER, M.D.: "The that’s why the city of Phoenix is only charging the impact fees in those areas where they have to build entirely new infrastructure. And that has to be paid for."

BILL LIPSCOMB: "What happens here again is you have long-existing communities that have been there for every and a day and the new developments, you know, some miles down away from that area, the impact of that new development upon the infrastructure is such that I think historically, and it's well documented, that development fees do not pay the full cost of growth.

Therefore, there always has to be a subsidy to that, and, therefore, the property taxes have to go up many a time to compensate for the difference in the dollar amount, Therefore, everybody…"

MICHAEL GRANT: "Of course, are they adding value in those kinds of things to increase the overall property value base?

CRAIG AHLSTROM: "It’s that same…"

JOAN KELCHNER: "It puts more and more pressure on older neighborhoods where you have more affordable housing and lower costs."

CRAIG AHLSTROM: "It's that same argument there with the school impact fees. The older neighborhoods, who are not charging impact fees, don't get that money, or wouldn't get the money from school impact fees to help upgrade their schools, build new schools. The money the new areas for -- that they would charge school impact fees, all the new areas would be getting money for schools. There is inequity there that the legislature hasn't taken into account."

MICHAEL GRANT: "Let me shift this slightly because I suspect we won't reach closure on this issue because we haven't reached closure on it for a long time.(laughing) Those are some of the sticks. I guess that's the main stick, the impact fee, development fee, whatever. There are carrots that -- what carrots exist?"

JOAN KELCHNER, M.D.: "In Phoenix we have had an infill program for a number of years. Because the City of Phoenix wanted to start to encourage developers to come back in -- in fact, we had to go to the state legislature to change legislation regarding how many municipal bonds are paid out by the city for a certain development fees.

But in the first infill project or infill area, which is bigger than the one that will be on our new plan that we're putting out, it only affected single-family homes and developers came in there -- there are several very successful developments such as around Osborn and 3rd Street where about 20 new homes were put on vacant lots at affordable home prices, very nice. Those type of things. We want to see that kind of infill.

That developer was given breaks on not only the development fees paid, but the fees for permitting and his permitting process was speeded up so it didn't cost him as much time and design review and that type of thing. So for the -- for him and for most of the houses initially, I think it was only averaging to about $2500 a home, but that's a $2500 cost that you can take off instead of add to a home, helping with the affordability.

Now, what we want to see as we continue to see the infill project evolve and people moving back downtown is we, and, you know, particularly those of us who live downtown and who have been working on this a long time, want to see that infill project extend to other types of housing, to the live-work spaces where you live above your store, to the condos and townhomes and row houses and things that may be more affordable even in more expensive type of land.

MICHAEL GRANT: "I do want to touch on one thing before we're out of time. It seems like every time you turn around there is another big box store that's being challenged.

How should communities handle this?

CRAIG AHLSTROM: "You know, it's -- we love them and we hate them. Everybody has to use them, every loves to go shop at them now, you can go do all your shopping in one stop…"

MICHAEL GRANT: "At 2 o’clock in the morning."

CRAIG AHLSTROM:"At 2:00 in the morning. But at the same time, nobody wants them in their neighborhood. But we can't -- we can't say, we don't want this in neighborhoods -- in this neighborhood so let's put it over here in a low-income neighborhood. Or let's put it over here in an industrial park where people just have to drive -- there's the same impact no matter where in the community you put it.

So the key is, we have to design them so that they fit nicely into the existing -- what's existing with our landscaping, with our – the design of the buildings and I am sure these large corporations, the Wal-Marts and Targets and, they're willing, as I sat through the design review process, they are willing to make some concessions.

JOAN KELCHNER, M.D. "Some concessions. Some."

MICHAEL GRANT:"We are out of time, for which I apologize. Joan Kelchner, thank you very much for your input. We appreciate it. Bill Lipscomb, good to see you. And Craig Ahlstrom, our thanks to you as well.