Smart Growthers and their Perfect Little State 
By John McClaughry

After months of agonizing effort, the legislature has brought forth a bill for "creating Vermont neighborhoods and encouraging smart growth development." The new bill (H.863) is the latest step in a process that dates back to 1970. Its passage again reveals the political tensions that arise whenever anyone in Vermont proposes to alter the environment for human benefit.

Act 250, enacted in 1970, established a strong public policy for controlling unchecked growth and the burden that it threatened to place on municipal services, education costs, and the natural environment. A key part of the bill - or so it was thought at the time - was creation of an all-embracing State Land Use Plan. Crafted by the appointed state Environmental Board and approved by the legislature, the Plan would designate the allowed uses of every square foot of the state.

This proved to be a bit much for the citizenry of the state. The Plan was hooted down in a raucous public hearing at Montpelier High School in 1974. Efforts by Gov. Salmon and the Plan's chief advocate, the Vermont Natural Resources Council, to get the legislature to pass watered-down versions failed in 1975 and 1976. By 1984 the requirement that there even be a plan was quietly deleted from Act 250.

In 1987 Gov. Madeleine Kunin made another run at it. She touted a "new planning era" that would be "uniform in standards, specific in requirements, and tough on delinquents." This became Act 200, but it was poorly received by property owners, towns and regional planning commissions, and gradually faded into obscurity.

So this year the legislature discovers that there is a serious housing shortage. But, in the view of the land use liberals who have waged this battle now for 38 years, builders can't just be allowed to throw up houses in response to market demand.

They insist that new housing be allowed, cautiously, only in carefully defined neighborhoods in and around town and village centers. Developers in these favored locations must be required to make a fraction of the units "affordable". This means that to get a permit for 100 new homes, developers must agree to sell 20 at a deep discount, and inflate the prices of the remaining 80 to break even.

The land use liberals, now known as "smart growthers", are alarmed at the prospect of housing development out in the countryside. They want densely packed, compact units within walking distance of local employment and a congested village center.

 As incentives to build in Vermont's 46 designated downtowns and village centers, the smart growthers will agree to exempt developments from the often horrendous burden of Act 250 permitting, bar citizen appeals of municipal approvals, reduce the land gains and property transfer taxes, and stick in some financial benefits for the host municipalities.

But the smart growthers' price for these concessions to homebuilders is stiffer regulation to discourage - if not stop altogether - growth in rural areas outside the favored villages. The smart growthers are allied with "affordable housing" advocates who insist on the highest possible fraction of subsidized housing in any allowed development.

Thanks to some good work by one of the legislature's shrewdest legislative craftsmen, Sen. Vince Illuzzi (R-Essex-Orleans), the bill that will go to the governor is vastly improved over the House-passed tangle of restrictions, mandates, subsidies, favors and penalties. In particular, the "smart growth" clampdown on building outside of village centers morphed into a study that will only make recommendations, not draft new legislation.

Still, a trip through the bill makes it shockingly apparent that despite the failures to enact explicit state land use controls in years past, the process of housing creation has been progressively throttled by high regulatory barriers and costly requirements.

Vermont could have the housing its people need. But just building that housing would reject the dreams of the smart growthers who have spent decades and millions of advocacy dollars trying to get the legislature to make Vermont into the Perfect Little State. Every time these interests gain ground, the goal of an increased supply of housing for Vermonters slips further out of reach.
 

John McClaughry is President of the Ethan Allen Institute.