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Encouraging infill development

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Title:
Encouraging infill development local government's role
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Drake-Holzhauer, Cheryl
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English
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110 leaves : charts ; 28 cm

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Subjects / Keywords:
Land use, Urban ( lcsh )
Real estate development ( lcsh )
Land use, Urban -- Colorado -- Denver Metropolitan Area ( lcsh )
Real estate development -- Colorado -- Denver Metropolitan Area ( lcsh )
Land use, Urban ( fast )
Real estate development ( fast )
Colorado -- Denver Metropolitan Area ( fast )
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bibliography ( marcgt )
theses ( marcgt )
non-fiction ( marcgt )

Notes

Bibliography:
Includes bibliographical references (leaves 106-110).
General Note:
Submitted in partial fulfillment of the requirements for the degree, Master of Planning and Community Development, College of Architecture and Planning
Statement of Responsibility:
submitted by Cheryl Drake-Holzhauer.

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University of Colorado Denver
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Auraria Library
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All applicable rights reserved by the source institution and holding location.
Resource Identifier:
12381107 ( OCLC )
ocm12381107
Classification:
LD1190.A78 1985 .D725 ( lcc )

Full Text
ENCOURAGING
INFILL DEVELOPMENT
LOCAL GOVERNMENTS ROLE

j
Masters Thesis
Cheryl Drake-Holzhauer


encouraging infill development
Local Government's Role
Submitted by:
Cheryl Drake-Holzhauer
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1130
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In Partial Fulfillment of the
Requirements for the Degree of
Master of Planning and Community Development
August, 1985


ABSTRACT SUMMARY
Expansive, sprawling development patterns have become synonymous with growth in the
U.S.. The consequences of this phonomenon are numerous, including the loss of open space
and environmentally sensitive lands, increased energy usage and air pollution, and unwise
public expenditure on unnecessary infrastructure.
Infill development can serve as an excellent method of reversing this country's
previous patterns of land development. National trends, such as changing life styles
dictating new preferences in housing type and location, new interest in neighborhood
rehabilitation and revitalization, increased availability of financing and increasing
influence of local governments, are making infill a more feasible alternative.
Infilling can not only result in a more efficient and compact community design, it
can help to countermand existing community problems such as declining neighborhoods.
Infill can encourage rehabilitation in surrounding areas and can eliminate unsightly
vacant parcels of land. Infilling, however, is not a catch all philosophy which will
solve all problems associated with community design and development. As such, infill must
be viewed as an element of comprehensive planning, and should not be approached with a
provincial attitude.
As with any development philosophy, infill is not without adversity. There exist a
variety of reasons that development on infill parcels has been averted. Additionally,
infilling has possible negative ramifications. Thorough understanding of these problems
is requisite to any program designed to encourage infilling which expects any degree of
success. The list of methods that can be utilized to this end is lengthy, and each method
has applications which can result in the negation of problems often associated with
infill. Many tools and techniques are being experimented with across the country to
encourage infill; these have seen varying degrees of success. These experiments can prove
to be a valuable resource to other communities if they learn from their successes and
failures.


The active role of local government in an infill program is a vital one. A look at
Front Range communities in Colorado has illustrated that mere policy formation and good
intent do not achieve results. Local governments which recognize the attributes of
infilling need to develop a strategy which is based on a thorough understanding of infill
issues as they relate to the specific community. The strategy must include an "incentive"
package designed with the community's unique goals, character, market conditions, etc. in
mind.
The role that local government should play has three components; that of actually
implementing the incentive package, that of facilitating the arrival of common goals with
other local governments, and that of attempting to alter legislation on a state level to
effect possible expansion and/or alteration of the incentive package.
Essential to any implementation program is political support. Without this basic
element, efforts put forth in an infill program may prove fruitless.


TABLE OF CONTENTS
List of Tables....................................................................1
List of Figures...................................................................1
Introduction .....................................................................2
Chapter 1 The Rationale .........................................................5
Infill Defined...............................................................5
A Growing Concern............................................................5
Population Shifts...................................................5
Preservation of Agricultural & Environmentally
Sensitive Lands...................................................7
Rising Energy Costs.................................................9
Rising Price of Land................................................9
The Expense of Sprawl..............................................12
Duplucation of Services............................................15
The Potential in American Cities...................................15
Emerging Trends Favoring Infill.............................................18
Changing Demographics..............................................18
Rehabilitation.....................................................20
Availability of Financing..........................................21
Suburban Growth Controls...........................................22
Footnotes ..................................................................23
Chapter 2 Problems Associated with Infill Development ...........................2k
Why Infill Sites Have Been Left Vacant......................................2k
Inadequacy of Public Facilities....................................2k
Developer and Consumer Willingness to Assume the Cost..............25
Lack of Coordination in Service Provision .........................26
Speculation and Taxation...........................................27


Lack of Centralized Information
28
Regulatory Procedures and Delays................................29
Land Costs in Urbanized Areas...................................29
Improper or Restrictive Zoning..................................30
Neighborhood Opposition.........................................31
Physical Constraints............................................32
Potential Adverse Side Effects of Infill.................................34
Gentrification and Displacement.................................34
Reduction of Future Development Options.........................35
Reduction of Open Lands.........................................35
Inflated Land Costs.............................................36
Higher Construction Costs.......................................36
Footnotes ...............................................................38
Chapter 3 A Survey of Front Range Communities.................................39
Arvada ..................................................................39
Aurora ..................................................................42
Boulder .................................................................45
Broomfield...............................................................47
Colorado Springs.........................................................49
Denver ..................................................................51
Englewood ...............................................................53
Fort Collins.............................................................54
Lakewood ................................................................57
Littleton ...............................................................59
Northglenn...............................................................60
Thornton ................................................................61
Westminster..............................................................61
Wheat Ridge..............................................................62


What does it all mean?...................................................63
Footnotes ...............................................................67
Chapter 4 Methods of Encouraging Infill Development...........................69
Centralized Information File.............................................69
Special Review Process...................................................70
Flexible Zoning..........................................................71
Creating Neighborhood Support for Infill ................................72
Land Banking.............................................................73
Land Assembly............................................................75
Voluntary Holding Districts..............................................76
Tax Increment Financing..................................................77
Tax Abatement............................................................79
Property Tax Disincentives...............................................81
Tax Exempt Financing.....................................................84
Land Write Downs.........................................................85
Land Leasing.............................................................86
Acquisiton of Tax Delinquent Properties..................................87
Fee Waivers..............................................................88
Federal Assistance.......................................................89
Capital Improvement Program Priorities ..................................91
Growth Management Techniques ............................................91
Footnotes ...............................................................95
Chapter 5 Conclusions and Recommendations.....................................98
A Regional Approach to Infilling ........................................98
A Comprehensive Plan Element.............................................99
An Infill Strategy .....................................................100
Infill Opportunities............................................100
Market Forces and Community Conditions..........................101


Designing an Incentive Package..........................................102
Techniques Available to City Governments .....................103
Techniques Local Government Can Negotiate.....................104
Techniques Local Government Can Lobby For.....................104
Bibliography ................................................................106


List of Tables
1 The Back-to-the Country Movement, 1975-1985..................................6
2 Motivation of Acquiring Land by Development Pressures....................... 8
3 Single Family Lots and Raw Land Prices in Selected Metropolitan
Areas, 1975-1980............................................................11
4 Community Prototype Costs...................................................13
5 Total Vacant Land and Buildable Vacant Land in Large Cities ................16
6 The 1980-1990 Growth of Households by Age Cohort............................19
7 Units of Local Government in the United States 1942-1982....................26
8 Vacant Land by Potential Land Use City of Arvada 1985 ..................40
9 Vacant Land by Potential Land Use City of Aurora 1984...................43
10 Vacant Land by Potential Land Use City of Boulder 1982 .................45
11 Vacant Land by Potential Land Use City of Broomfield 1984 ..............48
12 Vacant Land by Potential Land Use City of Colorado Springs-1981 ..........49
13 Vacant Land by Potential Land Use City of Denver 1984 ..................51
14 Vacant Land by Potential Land Use City of Englewood 1981 ...............53
15 Vacant Land by Potential Land Use City of Fort Collins 1983 ............55
16 Vacant Land by Potential Land Use City of Lakewood 1983 ................57
17 Front Range Cities, Summary of Infill Potential and Approaches..............65
18 Applications of Infill Techniques ..........................................94
List of Figures
1 Annual Range of Land Price Inflation 1975 1980............................10
2 Size Distribution of Sampled Infill Tax Parcels Three Case Studies........33
-1-


INTRODUCTION
Historically, the American city has experienced expansion horizontally, leapfrogging
and skipping over parcels nearer the city's core, in favor of parcels on the fringe with
fewer constraints to proposed development. The tremendous advent of suburban development
acceleration in the 1950's began the tradition of urban sprawl.
Suburbs on the fringes began incorporating and continued their growth outwards.
Today, many expanding metropolitan areas are reaching phycial and jurisdictional ^
K
boundaries that limit their further expansion. To these areas, bypassed parcels represent
one of the greatest potentials for development.
The importance of planning and development of a city's bypassed parcels is in no way
limited to cities that can no longer continue their patterns of sprawl. The continuation
of urban sprawl still exists as a possible alternative for numerous cities on the fringes
of metropolitan areas which are surrounded by vacant land. However, the evils of urban
sprawl have been well witnessed and should serve as a lesson to expanding cities.
Many emerging forces have occurred which are encouraging a reversal of previous
trends in land development. A renewed interest in developing those parcels bypassed
during the historical course of urbanization has emerged as a result. This development is
what is broadly termed "infill development".
In my work in a public planning office, I have witnessed numerous attempts by
developers and individuals to develop infill parcels. Rarely have their efforts been
successful.
Proposals on infill parcels are marched through the same regimented review process;
the same fee schedules are applied and costly development requirements imposed. Small
parcels surrounded by development have little if any chance of receiving approval of
increased densities. Neighborhood opposition is abundant, often resulting in the denial
-2-


of infill projects.
The outcome of these proposals is almost always consistent. If the proposal
surmounts the neighborhood opposition, it receives approval which ties prohibitive
development requirements and fees to the development, and offers little in the way of
density increases.
At this point, the project is often dropped. The development coummunity claims that
the development requirements and fees on top of the high cost of the land, plus the
inability to lower development costs by enjoying the economies of scale, make the projects
infeasible.
As I observed this process repeating itself, I began questioning the role local
government was playing in encouraging or discouraging the development of these parcels.
It was apparent that the current system was not accomplishing the widely stated goals of
achieving compact efficient development.
Local government has the potential of influencing this outcome. But how? The
objective of this thesis is to examine the role(s) that local government might have, the
approaches that can be taken along with their potential benefits and adverse side affects.
Research for this study consisted of a review of literature available on the infill
issue, both theoretical and on applications of various programs. A study of the issues as
it relates to the Colorado Front Range was conducted through review of policy documents,
master plans, and land use studies, of various local communities, as well as interviews
with their planning staffs.
My approach to the topic required a study of the assets of infilling and the
present and projected atmosphere for infill development. This is the focus of Chapter
1. Chapter 2 concentrates on the problems associated with infilling. A synopsis of
research as it related to infilling in the Front Range is included in the third chapter as
an illustration of how the issue is currently being approached. Chapter 4 examines the
alternative methods that could be employed in the Colorado Front Range as well as other
communities across the country. The 5th chapter consists of recommendatons as to the


essential tasks local governments must undertake if they intend to encourage infilling,
and the necessary elements of a successful approach to an infill program.


Chapter 1
THE RATIONALE
INFILL DEFINED
Infill development is terminology which is used with general acceptance among those
involved in land development processes to mean the development of parcels of land which
have been left vacant during the historical course of urbanization. A more inclusive
definition would involve underutilized land as well as vacant land.
Some would take this a step further and restrict the definition of infill development
to the use of vacant or underutilized land which has been left vacant, but has water,
sewer, and other public services and infrastructure already in place.*
During exploration of the issues involved in this topic, the various degrees of
definitions will be considered, and an appropriate definition will be brought to light.
A GROWING CONCERN
Officials of all levels of government are beginning to awaken to concerns over the
development patterns experienced in their comments for a number of reasons. Following is
a brief discussion of these concerns.
Population Shifts
Recent years have illustrated a decline in central city populations. Emphasis has
been on suburbanization and exurbanization. The entire nation as a whole has seen a shift
of population from the more densely populated areas to the less densely populated areas.
"For the first time in well over 100 years, there is virtually no map population trend in
the direction of concentration."
-5-


Table 1
7
The Back-to-the Country Movement, 1975-1985
(Number of Households in 000's)
Metropolitan Areas
by Region 1975
Northeast
Large 12,941
Medium 1,776
Small 87
Nonmetropolitan 1,422
North Central
Large 9,572
Medium 3,512
Small 1,169
Nonmetropolitan 4,809
South
Large 6,377
Medium 6,757
Small 1,417
Nonmetropolitan 8,029
West
Large 8,403
Medium 2,392
Small 615
Nonmetropolitan 1,843
Absolute Percentage
1985 Change Change
13,591 650 5.02
1,955 179 10.08
90 3 3.45
1,655 233 16.39
10,204 632 6.60
3,932 420 11.96
1,320 151 12.92
5,599 790 16.43
8,352 1,975 30.97
8,695 1,938 28.68
1,727 310 21.88
9,589 1,560 19.43
9,768 1,365 16.24
3,293 901 37.67
809 194 31.54
2,417 574 31.14
Note: Large metropolitan areas are those with populations in 1970 of 1 million or
more; medium metropolitan areas are those with population between 250,000
and 1 million; small metropolitan areas are those with populations of fewer
than 250,000.
Source: Bernard Frieden and A. Solomon, The Nations Housing, 1975-1985, MIT.
April 1977.
This shift has been a result of several factors although, the main influence has been the
loss of major emphasis, first to subruban areas and newer cities, and more recently to rural
areas.
The result is a decline in urban economics and a growing number of cities in fiscal
distress.
-6-


Preservation of Agricultural and Environmentally Sensitive Lands
Continued suburbanization can only result in further loss of productive agricultural lands
as well as environmentally sensitive lands. A valuable scenic and recreational resource will
continue to vanish unless the trend is reversed.
The speculative nature of land costs on the urban fringe will continue to have a
detrimental affect on the cost of farming.
As development spreads out from the city center, owners of lands at the fringe begin to
feel strong development pressures. As these pressures are exerted, land holdings begin to
change hands from those who held the land for personal use to those who hold the land for
development or investment purposes.
-7-


Table 2
Motivation of Acquiring Land by Development Pressures
(percent of land area)
United States Canada
Intense Moderate/weak Intense Moderate/weak
All owners(l)
Personal use 57.3% 82.1% 46.0% 85.3%
Investment 30.6 14.1 20.3 9.5
Development 12.1 3.7 33.8 5.3
Owners acquiring 1968(2) land since
Personal use 31.9 69.0 20.0 74.5
Investment 48.9 24.1 30.0 14.9
Development 19.7 6.9 50.0 10.6
1. Sample size of areas of intense development pressure is 128 for the U.S. and 79 for
Canada. For areas of weak development pressure the sample size is 321 and 193, respectively.
2. Sample size for areas of intense development pressure is 48 for the U.S., and 41 for
Canada. For areas of weak development pressure the sample size is 99 and 48, respectively.
Note: Column totals may not sum to 100 due to rounding.
Source: Brown, 3. James, et.al., "Land Markets at the Urban Fringe", Journal of the
American Planning Association, April, 1981.
The potential development of land at the urban fringe tends to drive up land
prices, thereby making agricultural or farming uses cost ineffective. The mere
inclusion of land within an incorporated area's growth limits on the comprehensive
plan has been known to drive land prices up, even though there is plenty of
developable land available for current needs.
-8-


Rising Energy Costs
The pattern of development affects the use of energy for transportation.
Continued suburbanization emphasizes reliance on an individual means of
transportation; the automobile. This mode of transportation not only is becoming
increasingly expensive, it is adding to the degradation of air quality.
Approximately one quarter of the energy used in this country is for
transporation. In America 90% of all personal travel is done by automobile.^ While
it is true that the fuel efficiency of cars is increasing, it is very questionable
whether or not this can offset the rising cost of gasoline.
The oil embargos which hit this country in the early 1970's began convincing
Americans that petroleum was a finite resource. The future must include an
alternative means of transportation.
Land development patterns can influence the frequency and distances traveled by
automobile. A more compact, concentrated urban form results in shorter commuting
distances and has more potential for various forms of public transportation
services. Public transit systems are not feasible where housing density does not
exist.
Rising Price of Land
Land prices have risen tremendously in recent years. In 1974 the Urban Land
Institute (ULI) conduted a study which found that the per acre price of raw single
family land increased an average of 87% between 1970 and 1974 (17% annually).-
A second study conducted by ULI in 1980 found that raw land prices increased an
average of 97%, and improved lot prices an average of 109% from 1975 to 1980. This
equals annual increases of 16% and 18% respectively, while the consumer price index
rose 9% annually during the same period.^
-9-


Figure 1
Annual Rate of Land Price Inflation 1975-80
#
u
e
e
K
e
e
<
28-|
20-
15
Th South Tho North
CPI
Improved
Lot Prices
3 Raw Land KS88S1 Consumer
Prices Price Index
Source: Miller, Jay, "Assessing Residential Land Price Inflation; Urban Land,
March 1981.
One of the major forces driving land prices up is the regional population
shifts which have been occurring in this country. An influx of population
stimulates a great demand for housing. Areas which have experienced an influx of
population have experienced the greatest land price increases. In areas
experiencing moderate or no growth, the annual rate of change in land prices was in
line with the CPI.
-10-


Table 3
Single Family lots and Raw Land Prices in Selected
Metropolitan Areas, 1975-80
SMSA Single-Family Lots' Raw SingL 1ncrease 75-80 Average 1980 1975 Annual 2 1980 e-Fami1y Land 1975 ($/acre)^ 1ncrease 75-80 Average Annual! 1975-1980 Housing Units Permi tted/1000 Popu1 at ion Percent Popu1 at ion Change 1975-1978
Northeast-Centra 1
Pittsburg $16,100 $10,100 10.9 $ 5,400 $ 2,900 14.5 14.6 -1.3
Hartford 22,300 12,200 14.4 8,200 3,900 17.7 16.8 -1.1
Kansas City 14,900 9,700 9.9 8,000 5,000 11.3 32.9 3.2
Indianapolis 11,600 7,000 11.9 4,300 3,000 8.1 34.9 1 .4
South
At 1anta $13,300 $ 8,900 9.2 $ 6,800 $ 5,000 7.0 47.5 2.7
Miami 25,000 11,100 19.9 57,000 35,300 11.2 49.1 .4
Jacksonvi1le 13,200 8,500 10.4 7,700 5,300 8.9 41.5 1.8
Houston 13,100 7,500 13.3 10,600 6,900 9.9 97.4 NA
West
Phoen i x $20,100 $ 9,500 18.2 $27,500 $ 9,800 25.7 111.5 6.9
Boulder 25,800 9,400 25.3 14,100 5,400 24.0 76.4 5.6
Seattle 20,600 8,300 22.3 22,100 7,300 28.1 75.6 NA
San Diego 38,600 15,200 23.1 30,900 8,400 33.7 76.2 7.4
Source: ULI 1980 Survey
' Ten-thousand-square-foot lots located in developing suburban areas with typical service and financing characteristics.
Unimproved land in developing fringe area suitable for single-family residential use with normal financing arrangements and access
to utility and road network.


In areas which are experiencing a great demand for housing and rising land prices,
land speculation is abundant, feeding the cycle of inflation.
The increase in land prices has been the most inflated component of housing costs,
and therefore, plays a major role in the exclusion of larger and larger numbers of people
from the housing market. Carr and Duensing cite a survey that showed that over one half
of the nations home-builders are building a product which can not be considered affordable
to median income families/
The Expense of Sprawl
It is a well accepted fact that the type of land use which utilizes the greatest
proportion of land, residential, in no way generates sufficient taxes to cover the costs
it creates. Commercial, industrial and office uses generate the necessary tax base to
serve residences.
Yet steps can be taken to minimize the costs of residential development. A study
conducted by the Real Estate Research Corporation entitled The Cost of Sprawl illustrates
that development costs, both public and private, decline with density and planning.
A prototype of a "low density sprawling development" has total capital costs 44%
greater, than a "planned high density development", infrastructure costs are 33% greater,
and annual operating outlays are 22% greater. Additonally, there are savings in water
usage and a decrease in air pollution.
-12-


Table 4
Community Prototype Costs
(10,000 units)
Low density Low deni sty Sprawl Planned High densl
Category sprawl planned m i x m i x planned
Capital costs per unit
Recreation S 268 1* $ 297 1$ $ 268 1$ $ 297 1$ $ 297 1$
Schools 4,538 9 4,538 9 4,538 12 4,538 13 4,538 16
Public faci1ities 1,662 3 1 ,626 3 1,645 4 1 ,622 5 1 ,630 6
Road/streets 3,797 7 3,377 7 3,235 9 2,708 8 2,286 8
Ut i1ities 6,197 12 4,744 10 3,868 10 3,323 9 2,243 8
1nfrestructure* 16,462 32 14,582 30 13,556 36 12,487 35 10,995 38
Residential 32,040 62 31,829 65 21,417 57 21 ,417 60 16,030 56
Land** 2,954 6 2,569 5 2,311 6 1 ,849 5 1,681 6
Total capital costs $51,456 100* $48,981 100$ $37,283 100$ $35,753 100$ $28,706 100$
Public proportion 19$ 12$ 24$ 16$ 18$
Public costs $ 9,777 $ 5,878 $ 8,948 $ 5,720 $ 5,167
Annual non-residential operation and maintenance costs per unit (in year 10)
Operating costs $ 2,111 $2,067 $ 1,965 $ 1,937 1,873
Public proportion 57$ 51$ 61$ 55$ 55$
Public costs S 1,203 $ 1 ,054 $1,199 $1,065 $1,030
Land required (for 10,000 units)
Developed acres 4,590 4,113 2,780 3,040 2,173
Vacant, improved
acres 459 206 278 152 109
Vacant semi-
improved acres 951 617 1 ,390 456 326
Vacant unimproved
acres - 1 ,064 1 ,552 2,352 3,392
Total vacant acres 1 ,410 1 ,887 3,220 2,960 3,827


Table 4
Community Prototype Costs
(10,000 units)
(Cont i nued)
Catagory Low density spraw1 Low deni sty p1anned Spraw1 m i x Planned mix High densl planned
Principal environmental impacts (for 10,000 units)
Non-auto air
populantsa 1,420 1,420 1,034 1 ,034 809
Sewage ef f1uent^ 4.5 4.5 4.5 4.5 4.5
Water usec 1,170 1,100 910 910 760
Non-auto energy use^ 2,355 2,355 1 ,750 1 ,750 1,400
Source: RERC, Vol. 1, Executive Summary
Notes: All dollar figures are per dwelling unit in 1973 dollars. Total protoype
costs are obtained when multiplied by 10,000.
Infrastructure is the subtotal of recreation and open space, schools, public facilities, transportation, and utilitites.
Land dedication by developers varies across prototypes and rises with density.
aLbs. per day.
^Billion liters per yeqr.
Q
Million gallons per year.
^Billion BTU's per year.


Duplication of Services
The continued trends of suburbanization and urbanization result in the
duplication of facilities already in place, and are in many cases, underutilized, in
central city areas. These facilities include sewer and water lines, treatment
facilities, electric and gas utilities, schools, and recreational facilities.
In many SMSA's closed school buildings are being sold for rehabilitation while
the suburbs are fighting to pass bond issues to finance school construction.
The enormous costs of providing infrastructure to developments has been an
obstacle to many municipalities. As such, special districts are being formulated to
finance the installation of water and sewer lines in outlying areas. In many cases
these lines will parallel existing municipal lines down streets and serve random
structures that the municipality is not serving.
The Potential in American Cities
A survey of American Cities published in Land Economics, indicated that a large
proportion of land in central cities was vacant and considered developable. On the
average (for cities with a population of 100,000 or over) the amount of vacant land
was 24.5%, of which 78.4% could be developed.
-15-


Table 5
TOTAL VACANT LAND AND BUILDABLE VACANT LAND IN LARGE CITIES
(Cities With Population Over 100,000)
Total Acres Proportion of Proportion
Date Vacant Land Acres Considered
City Reported Land Vacant Buildable
Akron, Ohio 1970 8,136 24 77
Albuquerque, N.M. 1970 22,000 51 95
Allentown, Penn. 1970 2,465 2 75
Amarillo, Tex. 1970 14,500 5 93
Anaheim, Calif. 1966 5,528 29 -
Austin, Tex. 1967 6,136 17 -
Beaumont, Tex. 1970 31,363 68 84
Birmingham, Ala. 1970 14,792 30 76
Bridgeport, Conn. 1962 727 7 -
Buffalo, N.Y. 1970 1,926 2 100
Cambridge, Mass. 1966 75 2 -
Camden, N.J. 1970 925 16 31
Chattanooga, Tenn. 1967 6,745 29 -
Chicago, 111. 1966 8,960 6 -
Cincinnati, Ohio 1965 10,270 21 -
Cleveland, Ohio 1970 926 2 100
Cropus Christi, Tex. 1970 38,622 60 100
Dallas, Tex. 1970 75,517 41 62
Dayton, Ohio. 1970 2,872 12 90
Dearborn, Mich. 1962 4,430 28 -
Denver, Colo. 1970 7,000 11 99
Des Moines, Iowa 1963 11,300 28 -
Detroit, Mich. 1962 5,272 6 -
Duluth, Minn. 1970 18,223 42 76
El Paso, Tex. 1970 29,263 40 78
Erie, Penn. 1970 2,063 17 95
Evansville, Ind. 1966 7,037 31 -
Flint, Mich. 1960 4,108 22 -
Ft. Wayne, Ind. 1968 2,026 7 -
Ft. Worth, Tex. 1960 34,349 39 -
Fresno, Calif. 1970 3,169 20 100
Gary, Ind. - 9,710 37 -
Glendale, Calif. 1970 7,552 40 33
Grand Rapids, Mich. 1970 5,580 20 85
Greensboro, N.C. 1970 14,710 45 97
Hartford, Conn. 1970 1,389 12 73
Houston, Tex. 1970 127,994 47 95
Indianapolis, Ind. 1970 150,180 48 60
Jackson, Miss. 1970 6,983 22 85
Jersey City, N.J. 1970 1,750 17 100
-16-


Table 5
TOTAL VACANT LAND AND BUILDABLE VACANT LAND IN LARGE CITIES
(Cities With Population Over 100,000)
(Continued)
Kansas City, Kan. 1970 13,116 36 100
Lincoln, Neb. 1970 7,998 28 55
Los Angeles, Calif. 1970 29,908 10 100
Louisville, Ky. 1970 3,800 10 17
Lubbock, Tex. 1970 23,109 98 87
Memphis, Tenn. 1968 31,559 29 -
Miami, Fla. 1970 2,830 13 100
Milwaukee, Wis. 1970 19,092 23 85
Minneapolis, Minn. 1970 1,711 5 72
Mobile, Ala. 1966 96,782 59 -
Montgomery, Ala. 1963 6,017 27 -
Newark, N.J. 1966 1,922 9 -
New Bedford, Mass. 1970 3,932 32 75
New Haven, Conn. - 1,158 10 -
Newport News, Va. 1970 15,902 36 95
New York, N.Y. 1970 25,656 13 90
Niagara Falls, N.Y. 1965 1,198 19 -
Norfolk, Va. 1970 3,335 10 100
Oakland, Calif. - 3,850 11 -
Omaha, Neb. 1970 6,669 16 70
Pasadena, Calif. 1961 1,129 8 -
Paterson, N.J. 1969 219 9 -
Peoira, 111. 1966 7,616 30 -
Phoenix, Ariz. 1970 76,729 99 67
Pittsburgh, Penn. 1970 8,230 23 36
Portland, Ore. 1970 9,825 20 38
Providence, R.I. 1961 1,062 9 -
Rochester, N.Y. 1970 1,765 8 71
Sacramento, Calif. 1970 18,610 31 80
St. Louis, Mo. 1970 2,127 5 92
St. Paul, Minn. 1962 5,031 19 -
St. Petersburg, Fla. 1970 9,672 27 100
Salt Lake City, Utah 1970 15,265 91 59
San Antonio, Tex. 1970 37,132 39 85
San Diego, Calif. 1970 107,537 59 95
San Francisco, Calif. 1970 1,371 5 85
San Jose, Calif. 1970 39,630 57 62
Seattle, Wash. 1970 5,919 11 60
Spokane, Wash. 1970 10,295 37 82
Springfield, Mass. 1970 2,200 11 75
Syracuse, N.Y. 1970 1,896 12 25
Tacoma, Wash. 1970 9,977 32 80
Topeka, Kan. 1970 9,961 20 70
Torrance, Calif. 1970 2,186 16 89
Tucson, Ariz. 1970 17,890 37 98
Yonkers, N.Y. 1960 1,768 15 -
Totals: 1,399,019 (N=86) 29.5 (N=86) 78.9 (N=58)
Sources: Northam, Ray M. "Vacant Urban Land in the American city.
"Land Economics, Volume XLVII, No. 9, November, 1971, pp.352-353.
-17-


All of these factors, working together, have many communities questioning their past
growth patterns, and the role government has played in them. There is now realization
that a choice exists, infill sites.
EMERGING TRENDS FAVORING INFILL
There are many emerging trends which are changing the setting in which development in
this country is occurring. These trends can work to facilitate infill development if they
are recognized and used to an advantage. These trends include the changing demographics
in the country, rehabilitation of existing areas, increased availability of financing, and
the involvement of local governments in the growth of their communities.
Changing Demographics
The age, size and composition of households in the 1980*s differs from past
decades. These changes will alter consumer preceptions and prefrences in the tupe, size
and location of housing.
The babyboom' generation is maturing and entering the housing market, creating an
increased demand. Additionally, the elderly population is growing considerably. The
q
proportion of persons 65 years or older has increased by 60% since 1950. The elderly are
more often seen living independently rather than in extended families. Central city
locations are much more attractive to seniors because of the greater availability of
public transportation, shopping, and health care facilities.
The following table reflects the projection that current household formation trends
will continue through the decade. The increase in households is reflected in age groups
of 25-44 and 65+.
-18-


Table 6
The 1980-1990 Growth of Households by Age Cohort
(000)
Age of Households No. of Households in 1980 Change in No. of Households in 1990 No. of Households 1980-1990 Percentage of Change by Age Cohort
14-24 6,379 6,564 185 1.1
25-34 18,681 23,289 4,608 26.3
35-44 14,523 21,768 7,245 41.4
45-54 12,611 14,380 1,769 10.1
55-64 12,744 12,521 -223 -1.3
65+ 16,359 20,277 3,918 22.4
TOTAL 81,300 98,800 17,500 100.0
Source: Harvard-MIT Joint Center for Urban Studies, Projections of Housing Consumption in the U.S. 1980 to 2000 by a Cohort Method (Cambridge, Mass,:
June 1980); Gruen Gruen + Associates.
Another factor which has contributed to the increase in the number of households, is
the changes of life styles occuring in this country. Since 1950, the number of households
consisting of one person has increased more than 50%; the number of multi-person
households which have no children has increased by 55%.*
More women are postponing marriage and children in favor of careers. Divorce will
continue to affect a good deal of all marriages in the 1980's. In 1980, one out of ten
persons who were living with a spouse, divorced and had not remarried. Overall, the
cohort with the largest increase in one person households in the last decade was persons
who were divorced or had never married.**
-19-


The inevitable result of these factors is that housing market consumers will consist
of more single persons, with fewer children. "The seven room home that sheltered two
adults and three children from 1950 to 1970 is likely to find only one adult in residence
in 1985."12
The influx of women into the job market will affect housing choices. In single
person households with one income or multi-person households with several incomes, there
is much less time available for care of the home and yard, and time to commute to and from
the work place. Many of these households will prefer the amenities and conveniences of
in-city living, close to the work place.
Attached housing will appear attractive due to the convenience offered through yard
and exterior maintenance handled by a home owners association. A move towards small lots
and zero lot line developments will be likely because they offer many of the benefits of
detached housing without the added cost and time involved in yard maintenance.
All the changes occurring are working to decrease the average number of persons per
household from 2.8 in 1980 to a projected 2.5 in 1990, requiring 17.5 million new housing
units.^ The challenge will be to provide appropriate houising types in sufficient
numbers in more centralized locations to satisfy the increasing demand.
Rehabilitation
One deterrent to infill development has been the presence of deteriorated or poorly
maintained residences and commercial/office buildings in the area. Builders are unwilling
to start new construction in run down areas where fire and vandalism are likely
occurrences. The deteriorated neighboring properties would also be likely to have a
negative impact on the value of a new project. It is very unlikely that interest will be
generated to develop in a declining neighborhoods until some renovation begins to occur on
existing structures.
Renovation is increasing in many cities and older suburbs. This has been encouraged
to some extent by the availability of Section 312 loans, and local loan/grant programs
-20-


funded in part throught Community Development Block Grants. The emphasis of federal
efforts has shifted from the previous concept of clearance and development to
rehabilitation and development.
There are many success stories of rehabilitation across the country. Ghirardelli
Square and the Cannery in San Francisco, the Century in Chicago, Trolley Square in Salt
Lake City, Pioneer Square and Pike Place Market in Seattle are examples of a few
commercial efforts. Denver will soon experience another rehabilitation effort with the
opening of the Tivoli.
Loft and factory conversions are making use of many vacated structures in central
cities as industry moved to the suburbs. Inner city vacated schools are also being
converted to residential use.
Vacant land in these improving neighborhoods are becoming more attractive and are
providing opportunities to satisfy a growing need for development.
Availability of Financing
One factor which has made infill development difficult for builders in the past is
the unwillingness of financial institutions to lend money for development in perceived
high risk locations without high equity requirements.
Fortunately, the previously mentioned trend towards neighborhood renovation and
improvement is removing the negative connotations often associated with infill
development. Lending institutions are seeing the success rates of these projects and are
becoming more willing to finance them.
The difficulty in any deteriorating neighborhood is going to be acquiring financing
for the first few projects in order to illustrate to lending institutions that the risk is
diminishing. Here, there is great potential for governmental assistance in the form of
public programs/policies to help get the ball rolling.
-21-


Suburban Growth Controls
Many localities are establishing growth management programs. The various methods and
techniques used to control, limit, and direct growth have been instituted for a variety of
reasons. In some cases, programs are instituted because the cost of providing the needed
facilities and services exceeds the capabilities of the governmental entity. In other
cases, programs are instituted to protect the way of life, the environment, or the
scarcity of water.
The result of these programs in many cases is a decrease in land available for
development at the urban/suburban fringe. Therefore, builders are being forced to look
for other sites for their projects. Skipped over parcels provide an excellent opportunity
for development to continue in a market affected by growth controls.
The stage for infill development is indeed changing. The potential for successful
development on skipped over sites in increasing. However, a thorough understanding of the
problems and constraints associated with development on these sites is essential if a
positive atmosphere is to be established, and success achieved. The next chapter will
explore this aspect of this issue.
-22-


Footnotes, Chapter 1
1. Real Estate Research Corporation, "Urban Infill: Opportunities and Constraints",
July, 1979, p.2.
2. Gruen, Nina, et. al., "Demographics Changes and Their Effect on Real Estate
Markets in the 1980's", Urban Land Institute, Development Component Series, 1982,
p.10.
3. Miller, Jay, "Assessing Residential Land Price Inflation", Urban Land, March,
1981, p.18.
4. Carr, James H., et. al., Land Use Issues of the 1980's, Center for Urban Policy
Research, New Jersey, 1983, p.5.
5. Miller, op. cit., p.16.
6. Ibid, p. 16.
7. Carr, op. cit., p.7.
8. Flebbe, Greg, City of Grand Junction, Colorado, Planning Department, APA
Conference, "Mulit-Jurisdictional Planning", May 1985.
9. Carr, op.cit., p.31.
10. Ibid, p.31.
11. Green, op. cit., p. 12.
12. Carr, op. cit., p.31.
13. Gruen, op. cit., p.13.
-23-


Chapter 2
PROBLEMS ASSOCIATED WITH INFILL DEVELOPMENT
In order to fully understand past, current and future development patterns in any
community, it is necessary to understand any problems that may have hampered or influenced
such development or non-development.
WHY INFILL SITES HAVE BEEN LEFT VACANT
The market assumption is that if sites have not been developed, there exist problems
with them. These can range from misconceptions and misapprehensions to very real physical
and socioeconmic constraints. Following is a brief discussion of the major problems that
have hampered development on infill sites.
Inadaquacy of Public Facilities
One of the major benefits of infill development is that many sites can make use of an
existing fixed investment in public facilities and related services. However, it is not
always the case that the facilities which are in place can adequately accomodate the
proposed infill development. The questions of capacity and condition must be explored in
each individual case.
Determination of capacity is not a difficult task in most cases. City engineering
departments often have maps which show the location and size of existing water and sewer
lines. However, this does not guarantee that the lines are of an adequate size to
accomodate the proposed development. The lines may have to be upgraded. The situation is
the same for storm drainage facilities which can no longer handle flows generated from
upstream development.
An even more serious problem than inadequate capacity of public facilities, is
inadequate condition, especially in older built-up areas. Many localities defer
maintenance of existing facilities because of a lack of budgeted funds. Deferred
-24-


maintenance can only work for a short period of time without causing the situation to
become much worse. A study conducted by the Urban Institute found that "There comes a
time when deferred maintenance and repairs necessitate total replacement of capital as the
only workable investment strategy. When this happens, the investment which has already
been made ceases to be an asset. New public network systems usually can be built far more
cheaply on undeveloped ground than on sites of existing facilities. The economic
advantage of cities lies in making the marginal maintenance and repair expenditures that
can keep the basic elements of their present infrastructure in adequate working order.
A study conducted in 1980 of four northern California areas, prepared by Connerly and
Associates, Inc., reflected that in each case, public service and facility deficiencies
was a factor deferring infill development.
Developer and Consumer Willingness to Assume the Cost
Development strategies which seek to encourage infill development often employ growth
management policies which limit services in fringe areas. Where these relate to the
provision of infrastructure (rather than the provision of a finite resource such as
water), the result has not always been a reversal of development patterns.
Instead, developers may pick up the cost for the necessary improvements rather than
the local government, engaging the philosophy that development must pay its own way.
Developers, in turn, pass the cost on to the consumer, which is in most cases a
homebuyer. This results in increased housing costs.
As long as there is a demand for suburban living, and the homeowners are willing to
pay the higher price, the possible savings and efficiency of using in-place facilities on
infill sites may not prove to be a sufficient incentive for residential builders.
The existance of infrastructure, if in good condition and of adequate capacity, may
prove to be more of an incentive for land uses other than housing. Commercial, office,
and industrial builders are not trying to satisfy clients who are chasing the dream of
-25-


suburbia. It is often much to their advantage to be more centrally located, in areas more
likely to already be serviced with public facilities.
Lack of Coordination in Service Provision
With the transfer of infrastructure costs from the public sector to the private
sector, a new phenomenon has arisen. Small, single purpose service jurisdictions are
appearing everywhere. The following table illustrates how the number of single purpose
districts has increased drastically over the last few decades.
Table 7
Units Of Local Government In The United States 1942 1982
1942 1952 1962 1972 1982
Total Local
Governments 155,076 116,694 91,186 78,218 82,688
Counties 3,050 3,049 3,043 3,044 3,041
Municipalities 16,200 16,778 18,000 18,517 19,083
Townships 18,919 17,202 17,142 16,991 16,748
School Districts 108,579 67,346 34,678 15,781 15,032
Special Districts 8,299 12,319 18,323 23,885 28,733
Sources: "Special District Government in Colorado," Colorado Public Expenditure
Council and "United States Department of Consumers News" Public
Information Office, Bureau of the Census, August 6, 1982.
A single purpose district is created, taxes are assessed on properties benefiting
from the service provided, and the necessary improvements are made, or service provided.
Often, one locality will be covered by a number of districts including several school
district, water districts, sewer districts, fire districts, and a multitude of special
districts. The jurisdiction of each district varies, and they overlap one another making
-26-


any coordination a very difficult task. Without a single agency responsible for
coordination, planning and implementation of capital improvements, a community can end up
with many partially served areas.
In Oklahoma City, the city is responsible for providing interceptor and truck sewers,
but a separate water trust is responsible for the extension of water mains. In Chicago,
individual communities provide sewer lines, but a metro sewer district provides the
treatment plant capacity. Situations such as these make planning efforts very
difficult. Each district makes decisions based solely on its own needs. School districts
close central city schools because of declining populations. Once these schools are
closed, it will be difficult to encourage infill housing development.
For infill sites, this lack of coordination and planning usually means a difficult
battle in trying to acquire the necessary services for development.
Speculation and Taxation
In this country it is financially beneficial for property owners of land in areas
being urbanized to withhold their land from development in anticipation that a future
scarcity of land will drive the price of their land up.
A study conducted by the Capital District Regional Planning Commission (New York) in
1980, found that the most common factor responsible for why infill parcels were vacant
was that the owners were holding land as an investment for future development or sale.^
This finding is paralleled in a study conducted by the Real Estate Research Corporation in
three urbanized areas (Dade County, Florida; King County, Washington; and Monroe County,
New York) in 1982.^
Additionally, owners are encouraged to keep their land vacant by a property tax
system which gives preference to undeveloped land. In Colorado, all properties, no matter
the use, are taxed at a constant rate (currently at a 1977 value). If your land is
improved, your taxes go up. If you let your land and improvements deteriorate, your taxes
go down.
-27-


In Illinois, vacant lots are assessed at 22% of fair market value, commercial and
industrial buildings at 40%, and apartment buildings at 33%. Taxation systems vary across
the country, but the result is consistent. Taxes are lower if the land is undeveloped.
Another factor which inhabits infill development is that of tax delinquency. It is
not uncommon to discover a vacant inner-city site with a fairly low sales price, but a
burden of unpaid back taxes. Many times these back taxes can exceed the asking price of
the property. State statutues often prohibit the taxing jurisdiction from waiving back
taxes, all or partially.
Lack of Centralized Information
In most communities, a developer must make numerous contacts in city governments,
county governments, school districts, water and sewer districts, and various special
districts, in order to acquire all of the necessary information on a parcel of land. The
purchaser needs information on schools, utilities, taxes, ownership, size, access (public
and private), fire protection, irrigation ditch and canal treatment, physical aspects,
general character of the area, zoning, comprehensive planning, etc. The absence of a
comprehensive file where this information is compiled and updated, makes it difficult to
market infill sites.
A survey conducted in 1979 by the Real Estate Research Corporation found that most
communities have at least some information on privately owned vacant land, usually from
their most recent land use survey. However, the information that is available is far from
complete. Information was found to be usually in aggregate form (by planning district,
section, township and range, etc.), but not on a parcel by parcel basis.^
Developers are often willing to dig through the files to acquire the information they
desire when they are dealing with a site on the urban fringe. But, when coupled with all
of the other difficulties of developing an infill site, going to all of this effort is one
more disincentive for the developer.
-28-


Regulatory Procedures and Delays
Other major factors restricting infill development are codes, administrative
procedures and review processes. Developers often feel that it will be far easier and
quicker to have their proposals approved by officials of semi-rural areas at the urban
fringe than city bureaucracies. Counties often have procedures which ease the development
process, such as exemptions from platting. It is uncommon to find these in a city.
Building, sudivision and zoning regulations are preceived to be less stringent in rural
areas than in urban areas.
Time delays are dreaded by builders, mainly for two reasons. The first reason is
financial. Each day that a developer must wait for permits, large amounts of money must
be paid for the pruchase or option on the land, without any return on the investment. The
second reason is the low probability of approval. The longer a development proposal is
pending, the easier it is for opposition to organize and build. Developers feel that the
risk of denial after the investment already made (in site purchase or option, engineering
and architectural fees) may make infill project financially unfeasible.
Most communities apply the same review process and time lines, and the same fee
schedules and requirements, to all projects. The small developer who is attempting to
build on a difficult infill site is treated identically to the large developer who is
constructing a hundred acre retail center on the fringe. This provides no incentive for
developers to choose an infill site over a fringe site.
Land Costs in Urbanized Areas
As a rule, land prices in urban areas are higher than in suburban areas, which are in
turn higher than fringe areas. This is even the case in fairly weak market areas. In the
case studies of Dade, King, and Monroe Counties conducted by the Real Estate Research
Corporation (1982) builders and realtors consistently cited high urban land prices as a
major deterrent to the financial feasibility of infill developement/ Land costs were a
major factor in the scale price differential among urban, suburban, and fringe locations/
-29-


In Sacramento, California, land on the fringes costs $10,000 to $35,000 an acre,
while infill sites cost around $60,000 an acre.^
The increase in land prices has been tremendous, and has been previously discussed.
It should be re-emphasized here that the increase in land prices has been drastic, both in
fringe and urban areas. Improved lot prices have kept pace with, and sometimes even
exceeded, the price increases of raw land.
Developers consistently state that higher densities must be permitted in order to
offset the higher cost of infill land.
Improper or Restrictive Zoning
The problem with zoning as it relates to development on infill sites, is two-fold.
First, is the problem of improper zoning. Communities many times have over zoned land for
commercial and industrial use. The land then remains vacant because there is no market
for more commercial or industrial use. A downtown revitalization strategy for Witchita,
Kansas, determined that almost all vacant land in the central business district was zoned
for high rise office buildings, yet the market held a demand for less intense mixed use
Q
developments.
Property owners of these overzoned parcels are opposed to down zoning because they
bought the property at inflated prices based on the zoning. Thus, they are unwilling to
reduce the selling price of their land. They would prefer to hold onto the land in hopes
that the market will change, and a higher return be acheived from development under the
current zoning. This philosophy is reinforced by tax systems in this country (as
previously discussed).
The second issue relating to zoning is that of restrictive or inflexible zoning on
infill sites. Zoning districts are normally accompanied by rigid development standards.
These include density limitations, minimum lot sizes and lot frontages, set backs, lot
coverage restrictions, and building height limitations.
Many communities have a planned unit development zoning district which allows greater
-30-


flexibility in development standards. However, the developer must go through a rezoning
process in order to have his/her site included in a planned unit development district.
Not only does the process of rezoning add to the delay and cost of the project, but also
mounts neighborhood opposition.
Builders and developers state that the most critical development standard which
inhibits infill development is that of density limitations. Higher land costs on infill
parcels can be offset by higher permitted densities in order to reduce the per unit costs
and broaden the affordability of housing units. Density is most critical in infill areas
with small parcels which are difficult to develop.
The Council on Development Choices for the 1980's has urged that communities allow
increased densities by reducing requirements for lot and yard sizes, setbacks,and street
witdths, and by assuring adequate amounts of land zoned for varying densities.*
However, higher permitted densities can be expected to generate greater neighborhood
opposition to a project. Developers complain that when the general plan and zoning are in
conflict, cities lean towards the least intense use. For example, a developer proposes a
medium density project on an infill site, which is in conformance with the general plan.
The zoning allows low density development. In most cases, cities have a tendency to stick
with the lower zoning density rather than to rezone the site to conform to the general
plan and allow the higher density. Generally, these decisions are made because of
neighborhood opposition to the more intense use.**
Neighborhood Opposition
Perhaps the most serious reason that infill sites are left vacant is neighborhood
opposition to development of these sites. Neighborhoods grow accustomed to the vacant
parcels in the area, and envision them as always remaining open their own natural
urban/suburban parks.
Residents oppose development of any sort on these parcels, and the more intense the
development, the greater the opposition. A study conducted by the Capital District
-31-


Regional Planning Commission (New York) found that opposition increased more than four
times under the hypothesis that a higher density than allowed under the current zoning
I ?
would be built.
Developers know that they will face a battle from the neighborhood residents when
they propose building on an infill site. Achieving approval of a low density project will
be difficult enough, but when a developer is trying to acquire approval to build at a
higher density to offset the higher costs, the chances of acquiring approval diminish
significantly.
Physical Constraints
A good number of infill sites may have been neglected because of various physical
contraints.
Parcel size and shape: Development has often left behind sites which are small,
and/or irregularly shaped. A study conducted by the Real Estate Research Corporation of
three county regions (Dade, Monroe, and King Counties) found that the majority of infill
parcels are relatively small. Over one half of the lots were under 1/4 acre.
-32-


FIGURE 2
Size Distribution of Sampled Infill Tax Parcels
Three Case Studies
KINO COUNTY, WASHINGTON
5 or more acres-
10.7%
1-5 acres
16.6%
1/2-1 acre
8.9%
1 /4-1/2 acre
15.4%
under 1/4 acre
48.6%
DADE COUNTY, FLORIDA
MONROE COUNTY, NEW YORK
1-5 acres
6.3%
1/2-1 acre
11.3%
1/4-1/2 acre
13.6%
5 or more acres
4.6%
5 or more acres
11.3%
1-5 acres
9.3%
under 1/4 acre
66.4%
1/2-1 acre
6.6%
1/4-1/2 acre
13.9%
under 1/4 acre
68.9%
Source: RERC; Infill Development Strategies, ULI and APA, 1982.
This finding held true in Arvada, Colorado when a vacant land survey estimated that
26% of the parcels surveyed were under 1 acre, 47% were 1-5 acres, and 15% were
5-10 acres.
A study of four Northern California cities conducted by Connerly and Associates,
Inc., found that infill opportunities for development for 50 units or more will be very
scarce due to infill parcel size and zoning.^ Thus, most large builders will explore
other markets to preserve their economies of scale.
-33-


Physical limitations: Limitations such as slope, flood plain locations, subsidence,
earthquakes, or landslides, do affect some sites. However, the Real Estate Research
Corporation found that the majority of infill sites were free of severe physical
limitations.^ Some may be more difficult and costly to develop, but usually not
impossible. These 'sensitive' sites require specalized construction techniques and
engineering studies which will increase the cost of development, and thus, affect
affordability.
There do exist many reasons why infill sites have been neglected in favor of
alternate sites. Many of these problems are specifically tied to infill sites, while many
others are no greater for infill sites than fringe sites. Until some incentives are
provided to encourage the development of infill sites, the benefits of developing fringe
sites will hamper infill development.
POTENTIAL ADVERSE SIDE EFFECTS OF INFILL
Any new development strategy, including that of infill development, can have negative
consequences. The possible effects need to be explored in order to minimize, or hopefully
eliminate, unintended consequences. Taking into account possible adverse side effects
will help evolve a well designed infill program, as well as facilitate choice of tools
used to implement the program.
Gentrification and Displacement
Gentrification, the takeover of lower cost urban neighborhoods by upper-middle income
or upper income households, has been a common result of the reuse of vacant urban land and
related rehabilitation. This results in displacement of lower income households due to
inflating property values. Displacement is a regional problem. Improvements in one
community will result in the relocation of lower income individuals to less expense areas
of the community, and eventually to other areas in the region, as the process continues.
-34-


This problem will be more serious in areas which appear more attractive to upper
income groups (areas with close proximity to downtown and attractive environments).
Public policies to encourage infill must be especially careful not to subdize affluent
households at the expense of lower and moderate income households.
Reduction of Future Development Options
Many infill sites are located in areas that are already deteriorating. The condition
of surrounding structures provides a disincentive to begin new construction in these
areas, and thus, they remain vacant. Many deteriorating areas have a number of abandonded
building. Cities which have a program to demolish severly run down abandonded buildings
create additonal vacant infill sites. If this process continues, large tracts of vacant,
developable land could be created with many development possiblities.
Present term infill stratigies which encourage immediate reuse of vacant sites could
result in modest projects such as small scale housing construction or small industrial
buildings. These types of development would preclude the future accumulation of more land
for large scale projects, such as in an urban renewal project. Thus, it is necessary to
examine the trends of land abandonment and reuse in deteriorating areas to determine
whether or not proposed infill uses are desirable in achieving short term objectives or
achieving long term objectives as well.
Reduction of Open Lands
A strategy successful at encouraging infill development will reduce the amount of
open land in the urban/suburban setting.
Although these vacent lands may not be classified as public open space, nor may they
function as parks, these open lands can provide a necessary function in any community.
Open spaces are a critical element which must be retained to some degree in all
communities. A policy concerning infill development should not overlook the importance of
retaining some pockets of open land.
-35-


Inflated Land Costs
Many growth management policies can have the effect of artifically influencing the
market value of land. Restrictions on land development in fringe areas affects the
economics of supply and demand. Thus, infill sites become more valuable, and a higher
asking price is attached.
As we have already seen, infill sites generally are more costly from the start. A
strategy to encourage development of these sites could feed the inflationary cycle,
driving up the cost of development, and in many cases the affordability of housing.
Higher Construction Costs
The development of many infill sites will be at a higher cost for reasons other than
merely inflated land costs. As noted earlier, the majority of infill sites are relatively
small, and some have physical constraints to development. Because of these factors,
economics of scale can not be enjoyed, and engineering and construction will be more
costly on a per unit basis.
Additionally, engineering and design costs may be higher due to physical
constraints. Specialized construction techniques and materials may be required. These
factors drive up the cost of the product and result in higher prices for housing, as well
as commercial, office, and industrial space.
Many reasons have surfaced which explain why infill sites have remained vacant.
Communities which are considerinig undertaking an infill program must determine the
reasons their infill sites have been neglected. Studies of this type are very rare in the
Colorado Front Range; only Arvada and Denver have tackled such studies. Additionally, if
this information were available on the entire metro area as a whole, a regional
understanding of the problems would appear and would result in a more comprehensive
program.
-36-


It appears that infill parcels are unlikely to be developed without the provision of
incentives. Any locality will need to keep the possible consequences of their incentive
program in mind if they choose to attempt encouraging infill development.
_77_


Footnotes, Chapter 2
1. Peterson, George E., "Capital Spending and Capital Obsolence; The Outlook for
Cities", The Fiscal Outlook for Cities, editor Roy Bahl, New York, 1978, p.49.
2. Connerly and Associates, Inc., "Urban Infill Development in Northern California:
Case Studies and Recommendations", November, 1980, p. 156.
3. Capital District Regional Planning Commission, "Urban Infill: Conditions and
Opportunities", report no. 100.7, New York, June, 1980, p. 19.
4. Real Estate Research Corporation (RERC), Infill Development Strategies, Urban
Land Institute and American Planning Association, Washington, D.C., 1982, p.118.
5. RERC, "Urban Infill: Opportunities and Constraints", July, 1979, p.20.
6. RERC, Infill Development Strategies, op. cit., p.3.
7. Baxter, Cheryl, "Urban Infill Development: The Potential for Dade County",
Florida Environmental and Urban Issues, October, 1981, p.20.
8. Connerly, op. cit., p.131.
9. RERC, "Urban Infill Opportunities and Constraints", op. cit., p.20.
10. Urban Land Institute, The Affordable Community: Adapting Today's Communities To
Tommorrows Needs, Washington, D.C., 1982, p.77.
11. State of California and California Building Industry Association, Filling in the
Blanks: Using Unused Urban Land, May, 1981, p.9.
12. Capital District Regional Planning Commission, op. cit., p.24.
13. Connerly, op. cit., p. 132.
14. RERC, Infill Development Strategies, op.cit., p.7.
-38-
V


Chapter 3
A SURVEY OF FRONT RANGE COMMUNITIES
Within the content of this chapter, the potential for infill and the atmosphere for
infill are explored in the Colorado Front Range. Fourteen cities were surveyed; all but
two are larger cities within the Denver Metro area. Fort Collins and Colorado Springs are
included because of their size, development activity and status along the Front Range.
Research was conducted through review of local government documents, and interviews
with City Staffs. The format of the chapter includes a discussion of the potential for
infill, policies affecting infill (positively and negatively), and implementation tools
and techniques being used to encourage infilling.
Arvada
Infill Potential:
The City of Arvada has a population of nearly 88,500 with a 19.6 square mile area.
Arvada is bounded by Westminster on the north and east, and Wheat Ridge on the South.
Expansion for Arvada will be in a westerly direction, should it occur.
As of January 1, 1985, 21% of the land within the City was vacant. Following are the
potential uses of this land:
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Table 8
Vacant Land by Potential Land Use
City of Arvada -1985
Land Use Acres % of Vacant Land
Conservation 5.57 0.2
Agricultural 316.03 11.8
Single Family Residential 328.65 12.3
Duplex 92.34 3.4
Mulit-Family Residential 79.12 3.0
Planned Unit Development 875.68 32.7
Office 115.74 4.3
Business 475.60 17.8
Industial 389.11 14.5
Total 2677.84 100.0
Source: City of Arvada; "Land Use; Zoning and Population Summary"; February, 1985.
Infill Policies:
The City of Arvada's newly adopted Comprehensive Plan established a potential growth
area of an additional 2900 acres, most of which lies to the west of the current City
limits. The City envisions its urbanized area expanding, yet at the same time, focuses on
the importance of contiguous development.
To accomplish this, the Comprehensive Plan included a section on infill
development. Policies included in the plan "encourage the development of infill parcels
where existing and adequate facilities are currently in place or can be conveniently
extended to serve the property."^ Additionally, the plan outlines conditions under which
higher densities than those shown on the Comprehensive Plan Land Use Map would be
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allowable. These conditions include:
1. The proposed development will be compatible with surrounding existing and/or
proposed development.
2. The proposed development will not be detrimental to the City's infrastructure.
3. The proposed development will not adversely affect the city's water supply and the
City's ability to provide water services to those areas shown on the Comprehensive
Plan Land Use Map.
4. The proposed development conforms to all applicable City policies and ordinances.
5. The proposed development is in general public interest.
Policy statements in the plan call for monitoring water usage and infill development
and an annual review to determine if policies need to be altered in order to protect the
integrity of the Land Use Map, the City's Targets (goals), and the Master Water and Sewer
Plans.
Implementation:
To determine the appropriate and most feasible manner through which to encourage
infill development, Arvada has undertaken a vacant land study and a vacant land survey.
The Vacant Land Study consisted of identification of vacant sites through the use of
current land use maps, aerials and field checks. A parcel file was compiled with a card
for each parcel containing as much data as obtainable including size, owner, address,
schedule number, valuation, etc. Although the file provides a good deal of valuable
information, more work is necessary to obtain complete data on all parcels. Additionally,
a program needs to be implemented to update the file and to make the information
accessible.
The Vacant Land Survey, conducted in September of 1984, contacted owners of vacant
property in the city to answer such questions as; Who owns the land?, Is it available for
development or sale?, If not, why?, What would it take for the property to be placed on
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-J
the market?, etc. The results of the survey can be summarized as follows-^:
. 76% of the parcels are owned by private individuals or groups, followed by 13.4%
owned by business partners or corporations
. 40% of the parcels are being held onto as an investment, 37% for personal use and
16% for future expansion
. 80% of the owners are not actively marketing their property at this time, and 40%
would not either sell or develop at current market price
. 60% state they will not develop or sell because of personal use of their property,
20% because the market is unfavorable, 18% because the City regulations are too
stringent, and 13% because it is a long term investment
. 33.3% state that in order to develop or sell there would have to be a change in
the market, 22% call for less stringent City codes, and 21% for a change in
planning and zoning policies.
This survey suggests that in Arvada, next to personal use, speculation/investment is
the main reason vacant land has not been developed. The second major influence that
appeared was a feeling the City's regulations were too stringent and therefore deterred
development.
The only tool currently existing to encourage infill development, is the use of a
planned unit development zoning district. This zoning category allows for more
flexibility, and thus, will make development of small, strangely shaped parcels, easier.
The City is in the initial stages of establishing a water monitoring program which
will track development of infill, as well as other parcels.
Aurora
Infill Potential:
As the second largest city in the Denver Metro area, Aurora has a population of
208,300 within a 61 square mile area. The City is basically restricted to growth to the
south and east, although it could expand slightly to close the gap between Aurora and
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Denver.
The City's 1984 Land Use Survey Report estimates that 49% of the City is
undeveloped.^ This vacant land has the following potential uses:
Table 9
Vacant Land by Potential Land Use
City of Aurora 1984
Land Use Acres % of Vacant Land
Single-Family Residential 3,000 15.5
Multi-Family Residential 2,300 11.9
Office 390 2.0
Commercial 1,340 6.9
Industrial 5,060 26.2
Private, Non-Residential 6,790 35.1
City Center 460 2.4
Total 19,340 100.0
Source: 1984 Land Use Survey Report, City of Aurora, Department of
Planning and Community Development.
Infill Policies:
The City of Aurora previously had designated a "Blue Line Policy" which stated that
Aurora's growth would be contained within a certain area. This policy was adopted to try
to contain growth in the urbanizing area and to encourage infill development.
The recently adopted update of the City's Comprehensive Plan (1984) lifted this blue
line. The City determined the policy was "unsuccessful in limiting the negative impact of
growth outside the City on Aurora citizens."^ Development was occurring in the country,
on the City's fringes, despite the lack of municipal services, with the creation of many
-43-


improvement districts. The City's position now is to undertake a program of "orderly
annexation" to bring urbanizing land under the management sphere of the City.
The City does report, however, that the Blue Line Policy was successful in
encouraging infill development. Although no specific data is available on the amount of
vacant land in the City when the blue line was first adopted (1978), the Planning
Department estimates that only about 20-30% of the City was developed in 1978. Today 51%
of the City is developed.
Even though Aurora envisions more than doubling its area of urbanization (an
additional 89 square miles are included in Aurora's new service area), the following are
still goals of the City:
. To create a greenbelt to buffer development beyond the planned urban development
area.
. To encourage infill development.
. To encourage land development patterns which reduce travel requirements.
. To utilize existing public facilities to their potential.
Implementation:
The only tool currently in use in Aurora which might encourage infill development is
a Planned Community Zone District which allows greater flexibility in design.
Aurora is currently pursuing an intergovernmental agreement with Adams and Arapahoe
Counties to limit the creation of special districts and the uncontrolled advance of urban
sprawl. Without county approval to create a special district to provide urban services,
development would be pushed back into the City.
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Boulder
Infill Potential:
Boulder covers a 21 square mile area and has a population of 83,300 people. Boulder
shares corporate boundaries with no other incorporated City. As such, it has the
potential to expand in all directions.
The most recent land analysis of the City (1982) estimated that 8.1% of the City was
vacant. The vacant land has the following potential uses:
Table 10
Vacant Land by Potential Land Use
City of Boulder 1982
Land Use Acres % of Vacant Land
Low Denisty Residential 103.2 9.4
Medium Density Residential 128.7 11.8
High Denisty Residential 62.0 5.7
Commercial 79.2 7.3
Industrial 598.2 54.7
Other 121.0 11.1
Total 1092.3 100.0
Source: Land Analysis of Boulder Service Area; City of Boulder, Planning
Department, January, 1982.
Infill Policies:
The Boulder Valley Comprehensive Plan designates one of its most important objectives
as the reduction/elimination of urban sprawl. The Plan states "in Boulder County, not
unlike most areas throughout the County, land use regulations have traditionally permitted
urban uses and development in areas where adequate urban facilities and services are not
-4 5-


yet provided, coordinated, nor planned. It is uniformally and universally agreed that the
resulting patterns of leapfrog, remote, urban development are inefficient, wasteful, and
seriously contrary to the public interest, health, safety, and welfare. One of the most
important objectives of the Boulder Valley Comprehensive Plan is the reduction, if not
elimination, of this urban sprawl."^
To this end, the plan contains policies with the following goals:^
. The City and County will work together to ensure development in an orderly
fashion which will take advantage of existing urban servcies and avoid
noncontiguous development.
. Identification of sensitive agricultural areas, and their preservation, to the
greatest extent possible, protection from development.
Implementation:
The Boulder Valley Comprehensive Plan has been adopted jointly by the City and
County. The main emphasis of the Plan is to allow urban development in the city and rural
development in the County.
The Comprehensive Plan designates an urban service area which is divided into three
areas; Area 1, Area 2 (a & b), and Area 3. Area 1 includes land which is currently in the
City limits. This is the primary land for development and services. Area 2 is land
within the urban service area (outside the City limits) which is expected to accomodate
growth through the year 1990. Area 2a is expected to develop in a 3 year period and is
planned for capital improvements. Area 2b is to develop after area 2a, during the balance
of the planning period. Area 3 is outside the urban service area and is not planned for
development. The City's capital improvements are based upon these area delineations.
The City also utilizes a growth management system which limits the rate of growth to
2% a year. In January of this year, the system was "streamlined" to eliminate the
complicated merit system in favor of a simplified proration system. The purpose of the
proration system is to allocate an equal share of permits to each developer based on a
-46-


ratio of permits available to permits requested. Each developer is guaranteed at least
one permit.
The previous merit system allowed competing developments to be given points based on
use of existing utilities, excellence in design, inclusion of moderate income housing,
innovative energy conservation techniques, etc. All of these design characteristics are
still considered desirable by the City, and will still be emphasized. The Planning
Department states that the standards of the merit system will be applied to the proration
system through amendments to the City's land use codes.
As one of these amendments, the City is exploring the institution of an overlay zone
in sensitive redeveloping areas of the core. This zone would set a minimum density at
one-half of that currently allowed by-right. Current maximum density would still be
allowed, but not by-right. Staff and Planning Commission review would be required through
a PUD process using special development guidelines.
Broomfield
Infill Potential:
Broomfield is a community of 25,000 within a 9.6 square mile area. Broomfield is
bounded by Westminster on the east and south, so any expansion will be to the north and
west.
A 1984 estimate of land use in the City of Broomfield indicates that 61% of the City
Q
was vacant. The vacant land has the following potential uses:
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Table 11
Vacant Land by Potential Land Use
City of Broomfield 1984
Land Use Acres % of Vacant Land
Residential 1,950 54.0
Commercial 125 3.5
Industrial 240 6.6
Other 1,295 35.9
Total: 3,610 100.0
Source: Mike Randall, Community Planner, City of Broomfield, Planning and Community
Development Department.
Infill Policies:
Broomfield is a relatively small community today, but envisions tremendous growth.
The Master Plan for the City establishes a Planned Urbanization Area for Broomfield with a
40.5 square mile area and a projected population of 98,600 in the year 2010.^ (The
Planned Urbanization area boundary exceeds the Comprehensive Plan boundary by 23.8 square
miles.)
The Planning Department is currently preparing a policy document for Planning and
Zoning Commission and City Council review. This will contain policy statements of the
goals and objectives included in the Comprehensive Plan. These goals include:
. The preservation of open space along the fringe of the service area.^
. Large parcels of land should not be skipped over as development occurs in the
Planned Urbanization area; logical extensions of utilities will dictate
development.
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Implementation:
The direction of growth in Broomfield is emphasizing outward expansion. Broomfield
desires to increase the size of its urban area by four times its current size. They do
invision a buffer of undeveloped land on the fringe of its future area of urbanization.
To this end, the City and Boulder County have cooperated in the acquistion of open space
land to preserve an urban buffer.
However, no tools have been created to specificially encourage infill development on
the City's existing vacant land.
Colorado Springs
Infill Potential:
With a population of 215,000, Colorado Springs is one of the front range's largest
communities. The City covers 110 square miles and lies within one of the fastest growing
areas in the state.
A study conducted in 1981 estimated that nearly 4096 of the City was vacant. This
land has the following development potential:
Table 12
Vacant Land by Potential Land Use
City of Colorado Springs 1981
Land Use Acres % of Vacant Land
Low Density Residential 17,059 61.2
High Density Residential 4,683 16.8
Commercial 2,357 8.5
Industrial 3,753 13.5
Total 27,852 100.0
Source: Skanlin, Tim; City of Colorado Springs, Planning Department
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Infill Policies:
The City of Colorado Springs is characterized by low density development and a large
amount of vacant land. The City is very concerned about past development patterns which
have resulted in its inefficient 'leap frog' design. Thus, the City has established as
one of its major goals, the "encouragement of infill to achieve and efficient utilization
of (the) City's resources."^
The City projects that the majority of the region's anticipated development to the
year 2000 would be handled through infilling. If this development were to occur in a
fashion other than infilling, the City's current 110 square mile area would expand to
nearly 170 squre miles; still with much vacant land.^
The Comprehensive Plan for the City designates the potential for infill development
as a major consideration in the establishment of priorities for captial improvements.^
The City has a first-come-first serve water policy which could have a detrimental
effect on infilling. This policy states that "the City is under no obligation to bank
water for undeveloped land within the City limits", nor is it obligated "to force
conservation or rationing for the purpose of banking water for land within the City
limits."^
Implementation:
Although the City has adopted policies expressing the desirability of infilling, the
exact means of doing so have not been established. The City is exploring using priorities
in C.I.Programs, rehabilitation and redevelopment programs, code revision and neighborhood
planning and education programs as means of encouraging infill. Additionally, revision
of the City's water policy must be explored.
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Denver
Infill Potential:
The city of Denver has a population of 530,000 within a 111 square mile area. State
legislation has prohibited the County of Denver from expanding, but the City could expand
to the north and partially to the south. The City is currently exploring this
possibility, however, unless a decision is made to do this, the City is essentially 'land
locked'. As such, its only growth potential will be redevelopment and infilling.'
A vacant land study completed in 1984 by the Denver Planning Office estimates that
11.5% of the City is vacant. The potential use of this vacant land has the following
distribution:
Table 13
Vacant Land by Potential Land Use
City of Denver 1984
Land Use Acres % of Vacant Land
Residential 4,448.63 54.26
Office 919.24 11.21
Parking 7.76 0.09
Planned Unit Development 501.03 6.11
Business 1,037.88 12.66
Industrial 1,284.54 15.67
Total 19,340.00 100.00
Source: Land Use and Zoning Summary; City of Denver, Planning Office, 1984.
Infill Policies:
The City of Denver recognized that is has much development potential through the use
of its vacant land. Land use policies adopted by the City strives to achieve the
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following objectives:^
. complete development of Denver
. emphasis on development of vacant areas within already developed portions of the
City
. fringe development must be contiguous to existing development
. encourage land use patterns which will reduce dependence on individual automobiles.
Implementation:
As an implementation tool, the City of Denver utilizes a planned unit development
district as an alternative to traditional zoning. This zone allows diversification in
land use, and flexibility in the design of sites. Additionally, the planned building
group procedure permits more flexibility in the arrangement of buildings than permitted by
the limitations of tradional zoning districts.
In certain areas of Denver where the City is trying to encourage housing development,
such as downtown, higher densities are sometimes allowed.
The City has recently compiled a parcel file on vacant parcels of land in Denver.
The file identifies parcels by area, size, value, zoning, address, census tract, and
schedule number. City staff indicates that there is occassional use of the file by
builders, however, there has not been much promotion for the use of the file by the
Planning Office.
Denver has contracted with the Center for Community Development and Design to conduct
a vacant land study for 4 of the 11 districts in City. The purpose of the study is to
obtain the information necessary to determine the feasibility of encouraging housing
development in the defined area; thus, the study concentrates on vacant land zoned for
housing development. The Center is contacting property owners to obtain parcel
information including size, physical attributes, constraints to development, reason for
vacant status, if the owner is willing to develop or sell, asking price of the land, etc.
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Englewood
Infill Potential:
At 6.5 square miles and a population of 30,422, Englewood is one of Denver's smallest
neighboring communities. The City of Englewood is "land locked" by Littleton on the
south, Bomar and Sheridan on the west, Denver on the north, and Cherry Hills Village and
Greenwood Village on the east.
The Planning Department reports that the City has very little vacant land. A 1981
study found that only 1.2% of the City was vacant, useable land. There was an additional
0.5% in vacant, unuseable land. Following is a breakdown of the potential use of this
land:
Table 14
Land Use
Vacant Land by Potential Land Use
City of Englewood 1981
% of
Acres Vacant Land
Acres
(vacant &)
(useable)
% of Vacant
<5c useable land
Multi family 26.50 35.4 10.50 20.7
Residential/professional 0.54 0.7 0.54 1.1
Commercial 7.59 10.2 5.25 10.3
Industrial 40.15 53.7 34.55 67.9
Total 74.78 100.0 50.84 100.0
Note: Unuseable land is that in a flood plain, does not have access, has unusual topography
Source: Englewood Planning Department, Economic and
Financial Background, 1981
Only four parcels of vacant land are over five acres; the remainder of the vacant
land are single family lots and a few unsubdivided parcels.
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Infill Policies:
Due to the location and developed status of Englewood there is no need for the City
to adopt policies to reverse the trend of urban sprawl and concentrate on infill
development. Opportunities for development in Englewood will emphasize intensification of
existing uses and redevelopment. Those vacant parcels which are useable will eventually
become developed as well.
Implementation:
No tools have been adopted by the City of Englewood to specifically encourage
infill. However, the City does employ a flexible zoning district, the Planned Development
Zoning District, which will help vacant parcels develop to their fullest potential. The
zone encourages diversification in design but not land use. The district provisions allow
the City Council to waive all or part of the Subdivision Regulations.
Fort Collins
Infill Potential:
Fort Collins is a community of 78,000 people within a 28 square mile area. A survey
conducted in 1983 estimated that 92% of the City was undeveloped (this includes areas of
irrigated or non-irrigated crop production and areas for animal grazing and pastures).
The vacant land has the following development potential:


Table 15
Vacant Land by Potential Land Use City of Fort Collins 1983
Land Use Acres % of Vacant Land
Low density residential 4,220.17 57.8
High density residential 1,430.26 19.6
Mobile home residential 122.75 1.7
Commercial 452.92 6.2
Industrial 818.50 11.2
Transitional 262.79 3.5
Total 7,307.39 100.0
Source: Existing Land Use Inventory, 1983, City of Fort Collins, Department of
Planning and Development
The majority of the vacant land is unplatted (79%) and 2.3% is in detention and open
lands.
Infill Policies:
Two of the main goals of the City of Fort Collins are to 1.) locate development in
such a way as to efficiently utilize public services and facilities, and 2.) to preserve
open space on the fringe of the City.
The City's goals include:*7
. establishing an urban service area within which the City will provide services
. encourage contiguous development consistent with the provision of utilities,
schools, parks, etc.
. placement of "urban" development nearer the fringes
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Implementation:
The City of Fort Collins and Larimer County have cooperated to establish an urban
growth area surrounding the City. The urban growth area establishes the area on the
fringe of the City wich is amenable to urban development, excluding all areas of
agricultural significance. Every five years the boundary of this area is reviewed and
modified as necessary.
The City of Fort Collins also has an intergovernmental agreement with the City of
Loveland to preserve an open space corridor between the two communities.
The City's Land Development Guidance System has been one of the major tools utilized
by Fort Collins to encourage infilling. The System guides development with considerable
flexibility. The concept is that development proposals are rated against set criteria to
evaluate its merits on size, shape, location, natural features, site concept, etc. The
City adopted this system because they found that while their PUD ordinance allowed more
flexibility and creative design, the density of residential areas and allowable uses were
bound by rigid and arbitrary limits that did not always reflect the capacity of the site
and neighborhood. The previous system was intended to provide equal guidance for infill,
as well as peripheral development. The City found that this was not the case; the
previous regulations "worked at cross purposes and often served as a brake to
redevelopment."^
The new system sets a minimum density to assure certain efficient service delivery.
The maximum density depends on the performance of the project relative to the criteria of
evaluation. The evaluation system allows bonus points for development projects which
utilize sites which are contiguous, are close to transit routes, that preserve sensitive
lands, etc.
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Lakewood
Infill Potential:
The City of Lakewood is a community of 128,000 people within a 37 square mile area,
and is one of Metro Denvers largest communities. The City cannot expand to the east or
north, but has tremendous potential for annexation and growth to the south and west.
The City conducted a vacant land survey in 1983 which estimated that 11% of the land
in the City was vacant. This vacant land had the following land use potential:
Table 16
Vacant Land by Potential Land Use
City of Lakewood 1983
Land Use Acres % of Vacant Land
Single-family 241 10.7
Duplex 73 3.2
Multi-family 1,284 56.8
Office 105 4.7
Commercial 97 4.3
Industrial 38 1.7
Conservation 285 12.6
Other 135 6.0
Total 2,258 100.0
Source: Lakewood Community Profile, 1985; City of Lakewood, Department of Community
Development, Special Projects Division
Infill Policies:
Lakewood has adopted several policies to encourage infilling based upon the
assumption stated in the City's general plan: "The plan assumes that Planning Commission
-57-


and City Council will endeavor to preclude leapfrog development and that contiguity of
development will be one of their major objectives." 7
These policies as stated in the City's District Plans include:
. encourage contiguous development
. encourage preservation of the environment
. to allow infill where appropriate
. to encourage the formation of special districts to improve undeveloped parts of
the urbanized area
. to allow waiving of requirements of the subdivision regulations when sufficient
proof is presented that the rest of the zoning requirements will be met, that no
additional public improvements will be necessary, and that the development will
be in conformance with the character of surrounding properties.
Implementation:
The City of Lakewood utilizes a planned unit development zoning district which allows
more flexibility than traditional zoning categories. This can help alleviate many of the
development difficulties which often accompany small infill sites. However, a rezoning
process is necessary in order to be included in a PUD district.
Lakewood is uncomfortable with measures which might increase residential densities.
The recent density sutdies which Lakewood has undertaken have resulted in a recommendaton
by the previous City Manager, William Kirchoff, that "densities be restricted to 10 units
per acre on all undeveloped land, including that which as already been zoned at higher
71
levels." This would preclude developers from achieving the economics of scale which
they state is often essential to make infill projects work.
The City's policy concerning the waiving of the requirements of the Subdivision
Regulations is rarely implemented. Occassionally, the requirement for a drainage study or
preliminary plat are waived, but very rarely.
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To help alleviate concerns of neighborhoods when development occurs, the City has
implemented a Neighborhood Referral Program. The programs requires the developer to hold
a neighborhood meeting before requesting rezoning or a special permit. Written
notification must be sent to property owners within 300 feet of a proposed development,
and special notification is sent to registered neighborhood organizations which have a
liason with the Planning Department. The City is hoping that this program will reduce the
friction between developers and neighborhood residents and open up the channels of
communication. This will be very useful for infill projects where neighborhood opposition
is normally very strong.
Littleton
Infill Potential:
Littleton is currently 11.5 square miles with a population of 31,000. The City can
expand to the west, south and east; Englewood and Denver share boundaries with Littleton
on the north.
No specific information is available on the amount of vacant land in the City,
however, the Community Development Department states that 5% vacant land is a fair
guestimate. The majority of the sites are single family lots dispersed throughout the
City. Very few large parcels exist.
Infill Policies:
The city recognizes the benefits of compact development and has adopted policies to
that end including:^
. encouragement of new development to make efficient use of land
. emphasis of new development in vacant areas within the existing developed limits
of the City
-59-


Implementation:
The two tools that Littleton uses to encourage infill development are flexible zoning
and land banking.
The City encourages all new development to utilize the Planned Development zoning
which allows more flexibility. This helps to overcome many development difficulties of
small infill sites.
The City's Land Banking Program consists of City purchase of vacant parcels of land
to allow for the relocation of older structures or the new construction of low and
moderate income housing. This program is funded through CDBG and Small Cities programs.
The City is currently seeking additional funds to assemble potential land banking sites.
Northglenn
Infill Potential:
A totally surrounded City, Northglenn (population 33,000) cannot expand beyond its 6
square mile area. The City is encompassed by Thornton, Westminster and Federal Heights.
The Planning Department estimates that 15% of the City is undeveloped, 10% of which
is open space. Due to the scarcity of vacant land, much redevelopment is likely to occur.
The three sources for new development include:^
1. 410 acres of open spaces. The City is currently involved in a study as to how
much should be retained. Some land will be converted to development uses, but
exactly how much has not yet been determined.
2. A 160 acre parcel, one of the two vacant parcels in the City designated for
development. The parcel is designated for multi-family use by the master plan.
3. The remaining vacant parcel designated for development is a 32 acre parcel. This
is currently being processed for multi-family use.
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Infill Policies:
The Planning Department reports that the City currently has no policy Document, but
is developing a master plan and 6 district plan. Each plan will contain specific
development policies.
Thornton
Infill Potential:
The City of Thornton has a population of 52,000 people within a 27 acre mile area.
The City can expand to the north and east, and to a limited degree, to the south.
The City does not have specific information concerning the amount of vacant land,
however, the Planning Department estimates that 60% of the City is vacant, or
agricultural. This estimate makes it apparent that Thornton has enough land within the
City limits to satisfy development demands for quite some time.
Infill Policies:
The City's Comprehensive Plan expresses concern over Thornton's past non-contiguous,
leapfrog development patterns. The plan recognizes the need to cluster development and to
"promote land use arrangements which encourage the reliance upon transportation other than
the automobile."
Implementation:
The City currently engages the use of now specific tools or techniques to encourage
infill development.
Westminster
Infill Potential:
The City of Westminster covers a 24.4 square mile area and has a population of
61,100. Westminster can expand to the west and to the north; it is bounded by Thornton
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and Northglenn or the east and Arvada on the south.
A January, 1983 estimate by the Planning Department found that 55% of the City was
undeveloped. No specific breakdown of the potential land uses of the vacant land is
available.
Infill Policies:
The main philosophy of the city is that growth will proceed based upon the
availability of utilites and public services. The ultimate goal is to expand the city
limits to include all of the land now designated as lying within the sphere of influence.
The City's Policy Document recognizes that there currently are large amounts of
developable land within the City and that "emphasis will be placed on those developments
which have the effect of providing 'infill' in order to maximize utilization of in-place
municipal service delivery systems, including, but not limited to, streets, water and
sewer lines, storm sewer, fire stations, libraries, and parks and recreational
facilities."^
Implementation:
Westminster encourages all development in the City to use Planned Unit Development
zoning to "promote design fexibility, land use flexibility, economics of construction,
preservaton of open space, and the inclusion of amentities."^
Additionally, the City reports that their Capital Improvements Program includes some
work for infill sites. However, no priority is given to infill sites when allocating
funds and establishing projects.
Wheat Ridge
Infill Potential:
Wheat Ridge is a community of almost 9 square miles on the western edge of the Denver
metro area. The City's population is 30,300. Expansion for will be in a westerly
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direction; the City is bounded by Arvada on the north and Denver on the east, and Lakewood
on the south.
According to the Planning Department, no current information is available on the
amount of vacant City land. The most recent figure is for 1975 which estimates that 23%
of the City was vacant; no breakdown is available.
Infill Policies:
Wheat Ridge does not have an active growth policy. This is mainly due to the
community's desire to remain small and unique. As such, the City has no policies
regarding infilling.
What does it all mean?
This brief survey illustrates that there is tremendous potential for infill
development in the Front Range. With the exception of Englewood and Littleton, there
exists large percentages of vacant land in the Front Range cities. Only Northglenn and
Englewood are limited concerning outward expansion. All of the remaining cities surveyed
have an alternative to infilling continued sprawl.
Policies concerning the evils of urban sprawl and the benefits of compact, efficient
development are very abundant, although implementation tools and techniques are lacking.
This may be due to a lack of understanding of the vacant status of undeveloped
land. Of all of the communities surveyed, only two have (or are in the process of)
studied the issue of why parcels have not been developed. Perhaps the lack of
implementation tools stems from confusion as to what the problem is and how to correct
it. More information will be necessary for these cities to be able to direct their
efforts.
Of the techniques that are being utilized, the most common tool is that of flexible
zoning. While this will help developers overcome some of the difficulties in developing
many infill sites, there was no evidence that the flexible zoning, as utilized in the
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Front Range, held any more incentive for the development of an infill site then a fringe
site.
Tools such as the Land Development Guidance System utilized by Fort Collins and the
Annexation areas 1-3 utilized by Boulder will have a more direct influence on infill
development.
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Table 17
Denver Metro Area Cities
Summary of Infill Potential and Approaches
City % of land vacant (year) Has adopted policies regarding infill Implementation Techniques utilized/pursued*
Arvada 21% (1985) yes vacant land inventory .vacant land survey flexible zoning
Aurora 49% (1984) yes flexible zoning .intergover mental agreement to limit special districts*
Boulder 8.1% (1982) yes .urban service area .growth management system
Broomfield 61% (1984) yes .open space purchase
Colo. Springs 40% (1981) yes .CIP priorities* .code revisions* .rehabilitation* .education
Denver 11.5% (1984) yes .flexible zoning .higher densities vacant land inventory vacant land survey*
Englewood 0.5% (1981) no .none
Fort Collins 42% yes .intergovernmental agreement for urban service area and open space corridor .bonus zoning
Lakewood 11% (1983) yes .flexible zoning waiver sub. regs. .neighborhood referral program
Littleton app. 5% (1985) yes .flexible zoning .land banking
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Table 17
Denver Metro Area Cities
Summary of Infill Potential and Approaches
(Continued)
City % of land vacant (year) Has adopted policies regarding infill Implementation Techniques utilized/pursued*
Northglenn app. 15% (1985) no .none
Thornton app. 60% (1985) yes none
Westminster 55% (1983) yes .flexible zoning .CIP use
Wheat Ridge 23% (1975) no .none
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Footnotes, Chapter 3
1. City of Arvada, 1985 Comprehensive Plan; final draft text, p.25
2. Ibid, p.26.
3. City of Arvada, Vacant Land Survey, September, 1984.
4. City of Aurora, 1984 Land Use Survey Report this figure excludes 5,070 acres of
open space.
5. Aurora Conprehensive Plan, 1984, City op Aurora, p.6.
6. Boulder Valley Comprehensive Plan, revised 1978, p.6.
7. Ibid, p.9.
8. 1984 Master Plan, Broomfield, Colorado, Appendix A, Planning and Community
Development Department.
9. Ibid, p.23.
10. Ibid, p17.
11. Ibid, p.32.
12. Comprehensive Plan, City of Colorado Springs, 1983, p.25.
13. Community Profile, City of Colorado Springs, Planning Department, 1981, p. 153.
14. Op. cit., Comprehensive Plan, City of Colorado Springs, p.25.
15. Ibid, p. 153 154.
16. Planning Towards the Future, a Comprehensive Plan for Denver, 1978, City of
Denver, p.8-10.
17. Land Use Policies Plan, Comprehensive Plan Land Use Element, 1979.
18. Land Development Guidance System for PUD's, City of Fort Collins.
19. Concept Lakewood, A development Plan and Planning Process, March, 1975, City of
Lakewood, p.24.
20. Concept Lakewood, District Plans I-VII, City of Lakewood.
21. Memorandum to City of Lakewood Mayor and City Council, from Wiliam Kirchoff, City
Manager, July 30, 1984.
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22. Conversation with Sue Piatt, Economic Development, City of Littleton, June, 1985.
23. Complan, Comprehensive Policy Plan, Littleton, Colorado, 1979.
2k. Conversation with Brian Davis, Planner, City of Northglenn, Planning Department,
June, 1985.
25. Thornton: A Comprehensive Plan, 1975, City of Thornton, p.54.
26. Policy Document, City of Westminster, 1981, p.8.
27. Ibid, p.8.
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Chapter 4
METHODS OF ENCOURAGING INFILL DEVELOPMENT
The previous chapter illustrates that while many localities find infill development
to be desirable, the mere adoption of policies will not in itself accomplish infilling.
Local governments must provide incentives to outweigh the advantages of fringe
development.
There exist many programs in the country which are designed to encourage infill
development. Still more programs exist which are designed to accomplish various other
development results. The techniques found in the various programs not specific to infill
incorporated into a program encouraging infilling.
This chapter presents an overview of these various methods and illustrates examples
where they are available.
Centralized Information File
Creating awareness of potential opportunities for infilling is an essential first
step in establishing any program. One thing any city can do is to compile and provide
information to builders and developers on vacant and underutilized land. Parcels must be
inventoried, characterized, and evaluated on their advantages and disadvantages.
Tax assessor's files, aerial photos, existing land use files, engineering records and
maps, and field surveys are all sources that can be used to compile an information file.
A comprehensive file will include data for appropriate parcels on size, zoning, master
plan land use designation, physical constraints, location and street address (if
available), tax data (delinquency, etc), valuation, owner and owner's address, and
infrastructure (capacity and adequacy).
Compiling such a file will take staffing and time, and requires a committment to
continue the program with a system for updating the file. Additionally, a committment to
utilize the file, and to make it accessible to those who can use the information, is
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essential. Mention has been made in the previous chapter of files which have been
developed in the Colorado Front Range (see Arvada and Denver). The main downfall of these
efforts is that they have not been utilized. Planning staffs have failed to publicize the
file and benefit from the tremendous source they have created.
Publicity programs could include flyers to developers, builders, and contractors that
work with cities. Colorado Springs, Colorado has compiled a map series which contains
site infrastructure data in a graphic form. The maps are used frequently by developers,
City Coucil, and the Chamber of Commerce. The Planning Department has taken an active
role in publicizing the map series through public appearances to community organizations.
The development of this information file is essential for another reason.
Development of a program to encourage infill must be based on a thorough understanding of
the vacant land in the community, if it is to be successful. Thus, the information file
provides the data base for the city staff to evaluate, analyze and design an infill
incentive program.
Special Review Process
Streamlining the review process for development can have the effect of lowering costs
to the developer, thereby providing an incentive to encouraging development activity. The
developer can avoid holding expensive, undeveloped parcels of land for long periods of
time while trying to acquire approval for a project. The benefit to the developer is not
limited to a financial one. The elimination of review steps in many cases provides an
incentive by reducing the developers anxiety and increasing interest in the project.
Fast-track review processes can be targeted to projects which meet established
community objectives, i.e. infill development. It should be cautioned that a streamlined
process should not be implemented at the expense of an opportunity for citizen
participaton. Not only would such a process receive little public support for approved
projects, it would eliminate a vital part of the planning process.
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Minneapolis, Minnesota has implemented a streamlined review process to encourage
middle income infill housing development. Boundaries were defined for the area in which
the special process would be applicable. The system allows for input from the city and
community, thereby assuring that public interest will be met.^
Winston-Salem, North Carolina has instituted an innovative program to encourage
infill development. The Planning Board offers design assistance as part of the review
process for developers who are unsure of the best use options for a particular parcel of
land.^
Flexible Zoning
Development of many small scale infill projects becomes difficult because standard
zoning requirements are inappropriate and too rigid to allow feasible development.
The use of planned unit development zoning districts can help alleviate some of the
difficulty in developing these sites because of the greater flexibility allowed in
required street frontage, setbacks, lot coverage, lot size, etc. However, most planned
unit development districts provide the same development assistance to fringe sites as well
as infill sites. There in no incentive tied to the district to encourage infilling.
Systems of bonus (or incentive) zoning, on the other hand, allow the builder to be
rewarded for achieving community goals and providing desirable public amenities. For
example, a developer may be allowed to increase the project density because it provides
lower income housing units, increased landscaping, or improved pedestrian/automobile
circulation.
The key to designing a bonus system is to convey a clear statement of what the
locality is trying to accomplish by using bonuses. The general intent must be translated
into specific objectives. In most cases, the bonus system would be designed to accomplish
a number of objectives, one of which could be infilling. In such a case, the system would
provide specified bonuses for the development of an infill site. The most common bonus is
that of relaxing the maximum density normally permitted on the site.
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As mentioned in the previous chapter, Fort Collins, Colorado, operates a type of
bonus system through its Land Development Guidance System. The system evaluates proposals
and assesses points based on project merits, one of which is infill status. The point
total determines the allowed density. The higher the score, the higher the density. The
Planning Department reports that the system has had a positive effect on encouraging
infill development.
Phoenix, Arizona has implemented a temporary density bonus system to encourage infill
development. The program is a two-year 'special offer' on density allowances in the
defined infill incentive area. Results of this limited project have not yet been
reported.^
The most difficult part of designing a bonus system is to determine the size of the
bonus versus the size of the amenity provided. The key is to weigh anticipated public
advantage in relation to the economic incentives necessary to encourage development of the
targeted site. If a proper incentive is not provided, the developer will neglect the
infill site in favor of another.
Other types of code revisions have been experimented with across the country to
encourage infilling. Montgomery County, Maryland has adopted an amendment to the zoning
ordinance to allow reduced lot sizes and flexible site layouts to encourage the use of
passed over vacant sites.** This program has resulted in a number of infill projects.
In Modesto, California, zoning code revisions were made increasing the allowable
densities. The goals of these revisions were to enhance the efficiency of urban service
provision and to preserve agricultural land. Most of the recent development in the city
has consisted of patio homes and apartments, resulting in an overall community residential
density increase from 6.95 units per acre in 1977 to 7.24 units per acre in 1980.^
Creating Neighborhood Support for Infill
One of the major obstacles to infilling is neighborhood opposition. A community that
envisions infill development as a desirable community goal had better prepare to play a
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role in the facilitation of the conflicts that will undoubtly arise between nearby
residents and builders.
Developers often find that calm, informative meetings held with citizens prior to
public hearings can do much to sooth the opposition to many projects. However, developers
must actually be willing to listen to neighborhood concerns, and make reasonable design
changes. Cities should not only consider encouraging interaction between the developer
and neighborhoods, but should consider mandating it.
Baltimore, Maryland encourages preliminary meetings between the builder and community
organizations. These meetings are required for any project which is on city owned land or
in an urban renewal area. The Planning Department has found that long delays in the
approval process are prevented and political conflict averted.*
As discussed in the previous chapter, Lakewood, Colorado has implemented a
Neighborhood Referral Program to help allievate concerns of the neighborhood. Contact
between the neighbors and the developer is mandatory. City Staff attends the meetings in
order to clarify requirements, procedures, etc. The program is fairly new, and although
it is not targeted specifically to encourage infill development, hopefully it will help
accomplish infilling.
Land Banking
Land banking is the public acquisition of land which is reserved or utilized to meet
growth and development needs for the future. Generally, urban fringe property is
purchased and then withheld from the market until it is needed to accomodate the orderly
growth of the community. While this fringe land is withheld from development, growth
pressures are directed inwards to undeveloped land already within the corporate
boundaries.
When the controlling entity determines that enough vacant, underutilized land has
been used within the corporate boundary, reserved land is then released for development.
During the interim, banked land can be utilized for agricultural or recreational purposes.
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Besides resulting in the orderly use of land and prevention of sprawl, land banking
can serve to achieve several other important objectives:
. To subsidize certain uses by selling or leasing land below acquisition costs (see
land write-down).
. To influence the type of development that will occur when the land is sold to the
private sector.
. To stabilize land prices in the urban core.
. To combat land speculation.
Land banking can recapture the increased value of the property resulting from public
improvements for public use rather than allowing the increase to accrue to individuals as
speculative profit. Edmonton, Canada estimates that approximately $1 billion will be
saved by homeowners and renters through the elimination of speculative profits throughout
the development period of its land bank property.^
Land banking is a commonly utilized technique in Isreal, the Netherlands, Denmark,
Norway, Sweden, and Canada. Its applicaton in the United States is very limited. This
can be attributed to the greater availability of developable land in the U.S. and the
public sentiment against public ownership of land intended for private use.
Fairfax County, Virginia applies the land bank theory by using revenue sharing funds
to purchase land (targeted for low and moderate income housing sites), and to establish a
revolving fund to finance its operations.^ The fund is replenished when a site is
developed and refinanced through a private mortgage lender. Thus, the cost of the
original acquisition is recaptured and transferred into the cost of a future public or
private use.
The experience of Fairfax County uncovered three obstacles to land banking;
restrictive enabling legislation, limited financial resources, and differing goals of
neighboring locations. State enabling legislation in Virginia is outdated and could have
presented difficulties. Fairfax surmounted this by basing its program on its authority to
give financial assistance to any political subdivision created by itself or the State.
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Another approach might have been to create a special purpose government which would
receive loans from the general government to purchase sites.
A land banking program requires financial resources to initiate purchases. Fairfax
was able to utilize federal funds because of its targeted use for the banked land. The
Housing and Community Development Act of 1974 provides federal guarantees for local bonds
to finance land acquisiton. This is another source localities can use to purchase sites.
Administrative prerogatives of local agencies proved to be an obstacle in the Fairfax
case. Cooperation must exist between the various governmental entities to accomplish
orderly growth. The resolution to differences can be negotiated through intergovernmental
agreements which strive to benefit the entire region.
Critics of land banking programs claim that public interference in the private market
could drive the price of available land up, as do other growth management techniques which
affect the supply of land. There is validity to this complaint. Steps must be taken to
ensure that enough developable land is available in order to minimize this possiblity.
Land Assembly
Another tremendous obstacle to infill development is the fragmented ownership of
larger vacant tracts. Developers find development of small, vacant, unusually shaped
parcels difficult because of the physical constraints, the inability to benefit from
economies of scale, and the inability to assemble a larger parcel of land because of owner
unwillingness to sell or lease land for development.
Local governments can act to assemble larger tracts of land. Urban renewal projects
were established in the 50's and 60's to accomplish this. However, many localities were
left holding large tracts of land which were not developed because of weak market
conditions. This made cities reluctant to engage in land assembly in the 1970's. Renewed
interest in urban revitalization and close-in living has caught the attention of many
developers. City governments may find it advantageous to pursue land assembly in order to
facilitate infilling.
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There are various levels of involvement which a city might select in this process.
Cities could assemble a file on available vacant or underutilized sites within the
corporate boundaries. The file would be made available to the private sector and would
save considerable effort and time trying to locate possible sites.
Local governments could act as an intermediary to assemble parcels with fragmented
ownership by negotiating for a block purchase by a developer. The developer would not
have to negotiate with several land owners and would more easily acquire land within the
city.
Cities could utilize their eminent domain powers to acquire land for sale to an
interested developer. Exercising this power is often a long and difficult process, and
proof must be offered that the project serves a legitimate public purpose. For infill
purposes, the use of eminent domain might best be reserved for cases where a developer is
committed to a specific project to prevent the city from being stuck with tracts of land
and no development activity.
Dallas, Texas has implemented a Land Purchase Guarantee Program which is designed to
Q
encourage inner-city development. The City guarantees that if the units do not sell
within a specified time period, the City will repurchase the remaining land at a set
cost. One project has been developed through the program, and was very successful. Thus,
the City has not had to repurchase any land, although funds have been set-aside out of the
City's federal revenue sharing funds.
Voluntary Holding Districts
Cities could create a private land bank by encouraging owners of land on the fringe
of urban areas to voluntarily withhold their land from development. Incentives such as
tax abatements or the payment of annual stipends could be used to accomplish this. Land
could be removed from this private land bank when needed for development by terminating
the incentive.
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Suffolk County, New York is currently employing this technique through the purchase
of development rights from agricultural land owners to prevent further encroachment of New
York City and its Nassau County suburbs.
While this technique would appear to have the result of restricting land availability
on the fringe, thereby forcing development pressures toward vacant land in the City, it
will only be successful if the profit which would be realized exceeds the profit realized
if the owner sold the land.
Tax Increment Financing
Tax increment financing is a method of capturing the tax revenue that results from
private redevelopment projects. A trust fund is established of those increased
revenues. The funds are reallocated to public purpose projects such as land acquisition,
construction of parking facilities, etc. The system serves as a spur to private
investment to continue. The tax base is increased without an increase in property taxes.
Typically, tax increment financing (TIF) yields only small amounts of revenues in the
beginning. Thus, large amounts of money are necessary from the public redevelopment
agency to start the project, develop a plan, contract with developers, and accomplish the
sale of municipal bonds.
A redevelopment agency must be established, the plan developed and area defined, and
tax base year selected. Revenues resulting from any future increases above this base go
into the trust fund. The agency contracts for completion of the project, assembles and
prepares the site and issues tax exempt bonds which are secured by the future proceeds of
the trust fund. The assessed valuation of the property will increase as a result of the
site improvements. The increment in taxes (the difference in taxes before and after
development) is earmarked for repayment of the bonds. The debt is retired. At this
point, the local government becomes the beneficiary of the annual tax increment.
Enabling legislation is necessary in order for a city to participate in TIF. The
enabling legislation sets the parameters for the uses of TIF. Usually the area must be in
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a slum, blighted area, or in a redevelopment district. The need to correct conditions
such as defective street layouts, faulty lot layouts, tax delinquency, diversity of
ownership, etc., provide the public purpose necessary to use TIF.
A 1983 survey by APA concluded that 28 of the states in the U.S. had enabling
legislation allowing TIF in local communities.^ States have adopted different approaches
to the issue, including the following examples:
California The existance of blight alone is not sufficient to justify the use of
TIF. Blight must exist and create a burden on the community that can not be remedied
by the private sector.
Colorado TIF is authorized under Colorado Urban Renewal Law for financing public
improvements in the urban renewal area. Thus, TIF can only be used in "a slum, or
blighted area" by law and requires the approval of a plan by the governing body which
is based on the city's general plan. Bonds must be retired within 25 years.
Illinois State legislation requires cities to prepare a redevelopment area plan,
however, the use of TIF is not limited to blighted areas. Conservation areas and
areas likely to become blighted in the future qualify.
Kansas TIF can only be used for commercial redevelopment projects. No residential
or industrial projects are included.
Maine Each development district must have an advisory bond with at least one-half of
the members being residents or property owners of the redevelopment district or
adjacent neighborhood.
Minnesota Guidelines are required for a TIF project including a statement of intent,
real estate data, procedures for clearing, improving and marketing the property, and
project costs. The plan must be reviewed by Planning Commission prior to its review
by City Council.
South Dakota All calculated tax increments must be returned to school districts,
thereby exempting school districts from the TIF process.
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Texas A special definition for blight must apply to one-fourth of each TIF district,
and the trust must expire no later than 15 years after its conception.
Wisconsin The state development of revenue, rather than the local government,
calculates the tax increment base. This is to prevent local authorities from
adjusting TIF districts and properties in order to increase project revenues.
There has been contention by DURA (the Denver Urban Renewal Authority) that housing
construction is hardly feasible with TIF. DURA believes that TIF will work best for dense
development which will generate sufficient tax revenues to retire the bonds. ^ However,
Los Angeles has had tremendous results using TIF for infill housing development by
providing one-to-one replacement of housing units lost within the redevelopment area. A
total of 7,100 low and moderate income and elderly housing units have been built using TIF
in Los Angeles alone. ^
Tax Abatement
In states with provision for tax abatement, real property taxes can be abated for
private urban redevelopment projects. Often, powers of eminent domain are delegated to
private redevelopment corporations, which are limited in their rate of return.
The main criticism of tax abatement focuses on the loss of real property taxes. The
abatement serves as a subsidy to the private developer and means a loss in revenues to the
rest of the community. Communities often fear that a tax increase will be necessary
throughout the community to make up for that loss.
TIF has property tax results like that of tax abatement, yet is does not receive this
criticism because the loss is not as apparent. In TIF, property taxes generated by
redevelopment projects are diverted to retire the bonds. Taxes are not abated, but tax
revenues are not available for general government purposes, until the bonds are retired.
Unless competing services and investments are sacrificed, a tax increase may be necessary
throughout the community to replace lost revenues. Even the use of Community Development
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Block Grant funds for redevelopment has a cost to the community. Costs of projects
usually exceed the CDBG funds available requiring additional funding from the locality,
thus cutting into the general revenues of the community.
Statutory authority is necessary to provide for tax abatement, to confer eminent
domain powers on private redevelopment corporations, and to establish the public and
private roles in the redevelopment process. Local ordinances may be necessary in order to
enact state statutes depending on how the state legislation is drafted.
Property tax abatement addresses a deficiency which is built into the tax system in
this country. This deficiency is the tendency of our tax system to discourage investment
in new improvements.
Empirical studies have found that while taxation rates are not one of the primary
factors in the selection of a development location, local tax differentials can exert a
'swing' factor in the favor of one location over another. ^
Property tax abatements have been found to be more influential in determining the
volume of investment for large development projects because the ratio of cost reduction
due to tax abatement increases with the size of the project.^
While the public costs of revenue lost are the same in T1F and tax abatement
programs, TIF offers greater benefits to the developer. A study by Gary Conley, Assistant
Director of Dayton's City Wide Development Corporation found that ''the percentage savings
to the developer with a 25-year tax abatement is 5.7%, while with a 25-year tax increment
bond, the developer would save 8.5%.^ This is due to the ability to "write-off" or
deduct the full cost of property tax payments when calculating corporate income taxes plus
the low interest financing available under TIF.
However, in tax abatement programs, the city assumes only a minimal role in plan
approval and monitoring, while TIF programs require a large committment to program
administration, site acquisition, relocation, site clearing and improving, etc. From an
administrative standpoint, tax abatement programs may be more attractive and cost
effective for a city.
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St. Louis, New York City and Kansas City extensively use tax abatement programs, for
various commercial and residential projects (with great success). Even more localities
extend its use industrial projects.
Most state legislation does not allow its use only to accomplish infill or to'
redevelopment areas with little investment activity. Unless infill programs can be
interpreted as allowable under the applicable state legislation, cities may choose to
lobby for changes in the enabling legislation.
Birmingham, Alabama, in conjunction with the county, offers a 15-year tax exemption
to developers who use vacant land in the already developed areas of the City rather than
undeveloped parcels on the fringe.
Colorado has a tax relief program for the elderly in which property tax costs are
offset by state income tax credits. A constitutional amendment would be necessary to
expand the use of tax abatement in Colorado to such specific uses us infill development.
Property Tax Disincentives
The administration of the property tax system in the U.S. has varied over time, but
the tax has always retained its basic characteristic of an ad valorem tax on wealth.
Property tax remains the single most significant source of revenue for state and local
governments. Since 1950, 45% of the annual state and local tax revenues have been
provided by property taxes across the nation.^
Clearly, the property tax is an essential source to state and local governments.
Yet, the structure of the property tax system in this country ignores the goals of spatial
development patterns so often vocalized by communities of this country. Walter Rybeck,
President of the League of Urban Land Conservation, emphatically states: "If an enemy of
society wanted to encourage blight and neighborhood instability and to drive business,
residents, and tax base beyond the city limits, he might invent a system much like our
present property tax. A tax system that systematically penalizes those who put property
to good social purpose while rewarding slumlords and land speculators clearly is not
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helping America attain its objective of 'a decent home and a suitable living environment'
for every family enunciated in the Housing Act of 1%9."^
There are several approaches which could be implemented in order to utilize our
property tax system to encourage improvement and development rather than neglect and
disrepair.
Site value taxation, or land value taxation, places the emphasis of taxation on the
land, rather than on the improvements, as in our current system. This can be accomplished
either by totally replacing the general property tax with a land value tax, or by
differentially heavier taxation of land than of improvements a graded property tax.
Such a taxation system could have two effects, one on the price of land, and another on
the timetable of development. There exists fairly unanimous agreement among economists
that a higher site tax, without a decreased improvements tax, would result in a fall in
the price of land. *7
As to whether or not an emphasis in taxation on the site rather than on the
improvements would accelerate development on vacant parcels, there is disagreement among
the experts. Some experts (Netzer, Turvey, and Holland) claim that site value taxation
I R
would have a neutral effect on the decision of when a parcel of land developes.
Other economists (Smith, Archer, Grieson, Pollock, and Shoup) have concluded that a
site value tax will definetely affect an investor's decision on whether or not to hold
I 9
onto a parcel of vacant land for further appreciation.17
Because no city in the U.S. has adopted a site value tax, only empirical evidence is
available, and that is controversial. It is uncertain if a site value tax would encourage
development of vacant parcels. It is evident, however, that a site value tax would have a
?0
large impact on the degree of capital intensity of improvements to land. This would go
a long way in improving rundown conditions which so often discourage development of infill
sites in deteriorating neighborhoods.
There are examples of programs in the country which lean in the direction of a site
value tax. In Pittsburgh, the tax rate on buildings is one half the rate on land.
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According to the Mayor, the system has property owners more concerned with putting their
? I
property to a higher use.
Australia and New Zealand use site value taxation in nearly 80% of all local
jurisdicitions. Australia reports that a tremendous amount of redevelopment has occurred
in the central business district due to its site value tax.
Another approach to adjusting the development disincentives of our property tax
system is a vacant land tax. This consists of assessing a tax on vacant or underutilized
land in addition to the tax that would apply if the site were fully developed. The
specific intent of this tax is to encourage development of vacant or underutilized land.
Economists claim that a tax on vacant land will reduce the price of land because the
vacant land loses its potential for speculation. Additionally, it would encourage
earlier development of the land.
Land value increment taxation is a form of capital gains taxation levied on gains
which occur due to appreciation in land values. This type of tax will decrease the value
of the land to the owner because of the reduction in expected net price when the land is
sold, due to the tax. Thus, the asking price of the land will decrease. However, this
reduction will only occur if the tax is applied to realized increments rather than
accrued increments. Applying the tax to realized increments only will not encourage sale
or development of the property.
Transfer taxes, or taxes on sale of real property, will tend to reduce activity in
real estate transactions. For localities which are trying to limit speculation, this may
be a consideration. However, economists are uncertain as to whether or not such a tax
would affect the timing of development. The tax may provide an incentive to hold onto the
land in anticipation of a tax upon sale.^
Localities which desire to encourage development on parcels of land with vacant
status will find that adjustment in our nation's taxation policies would be advantageous,
and may wish to lobby for such a change. Both site value and vacant land taxes would most
likely have the effect of lowering land prices and stimulate development. The premise
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here is that public authorities have a better understanding of how and when land should
optimally be used than the private sector. If the main objective of the government is to
achieve development of vacant land, a tax limited to vacant land may be more effective.
The use of land value increment taxes and transfer taxes have effects which-would not best
accomplish infilling.
Tax Exempt Financing
Tax exempt financing consists of the borrowing of funds at tax exempt interest rates
and use of these funds to encourage housing production and purchase. Tax exempt funds can
be applied to housing only through the sponsorship of a public agency which defines a
public purpose as justification.
Four basic methods are used to pass on the interest rates gained from tax exempt
borrowing:
1) Relending at below market rates for housing construction.
2) Subsidization of permanent mortgages for purchasers of housing.
3) Loans to lenders programs which provide below market interest loans to thrift
institutions for relending to housing purchasers.
4) Acquisitions on the secondary market of below market loans originated by such
institutions.
Local governments can lower mortgage rates paid by citizens by giving their official
sanction to the borrowing and lending activities of savings and loan associations and
other financial institutions. Borrowing performed under the name of local governments can
automatically result in an interest rate savings in the range of 2%.
Although lowering the cost of housing is the most obvious objective of tax exempt
borrowing, these programs can also serve to increase the housing supply, to encourage
rehabilitation, and to effect land development patterns.
A number of tax exempt rehabilitation programs have been implemented which have
helped to begin the revitalization necessary in many declining neighborhoods in order to
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attract infilling on existing vacant parcels.^ The mechanisms for local rehabilitation
financing are essentially the same as those used in mortgage programs, although on a
smaller scale.
A tax exempt program can be designed to influence development patterns by including
specific objectives consistent with the locality's goals. Several states have utilized
tax exempt programs effectively to reinforce a general strategy of urban revitalization.
A similar program could be designed to achieve infill development. The key is to develop
a plan which offers subsidies over competing locations.
Minneapolis and St. Paul, Minnesota participated in a joint project in which 95% of
the bond proceeds were committed to new construction and much infilling was
accomplished.^ Additionally, the Iowa State Housing Finance Authority provided below
market interest rate mortgages for a public-private partnership known as the Centre Metro
Infill Housing development in Des Moines.
Land Write Downs
Land write downs occur through the city selling property (either already city owned
or acquired) below the market value and absorbing the loss. Write downs can be used for
any type of development meeting city policies. This system cannot only lower the costs of
development, but will encourage development on specific parcels within the city.
A program could be designed with guidelines to encourage the type of development
which has been targeted by the city for particular sites. Financial incentives can be
tied to the write down formula in such a way as to lessen the cost of the land as a bonus
if the builder's proposal accomplishes the goals of the city.
Portland, Oregon uses land write downs to encourage the development of middle income
housing ($50,000 to $120,000 in 1982 dollars). If the selling price of units exceeds this
limit, a surcharge equal to 10% of the difference between the maximum limit and the
selling price is attached.^
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Properties would not necessarily have to be acquired by cities to participate in a
write down program. Cities, redevelopment agencies, school and park districts etc.,
control much of the country's potentially developable land. The value of land owned by
the colleges and universities in the U.S. is estimated at $5 billion.^
Cities need to inventory all publicly owned lands and determine how much is
'surplus'. Surplus land would then be marketed for sale through a write down program.
Project Centre Metro in Des Moines, Iowa was accomplished on county owned land, donated to
the infill project. The project consisted of 120 single family detached units and
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townhomes.
Land Leasing
There will arise cases when public agencies will prefer not to sell surplus land.
This may be because the land was originally donated, acquired through condemnation, or it
may be held in reserve for future use. In cases such as these, the public agency may
choose to lease the surplus parcels. Nonprofit organizations and governments are finding
that long term leases are useful in encouraging the optimal development of vacant and
underutilized land.-^ Rent payments are deductible from federal income taxes as a
business expense. This can provide a powerful incentive because land is not a depreciable
asset.
San Diego, California, and Portland, Oregon have used land leasing programs to
encourage contruction of low and moderate income housing with great success. In San
Diego, leasing and write downs were combined with some of the city's surplus land being
leased a below market rates. Reduced rates are based on the feasibility of the project
and run at about 10-15% (annually) of the land value. Portland, Oregon subsidized a lease
in one case in order to enable the developer to use Section 8 for all of the constructed
units.
Stanford University has received an annual return of $1 million a year for the lease
of its surplus land for a shopping center. Rutgers University has leased some of its
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surplus land in a 50 year lease. The land is being used by a private developer for the
construction of townhomes and garden apartments. The University retains title to the
land; if they find that land is needed for expansion in 50 years or so, they can choose
not to renew the lease. In the meantime, the land is used to the benefit of the
community, producing housing, income, and a tax base.
Acquisition of Tax Delinquent Properties
Most localities have an inventory of tax delinquent properties within their corporate
boundaries. Gennerally these properties are in ill repair and are of very little benefit
to the locality. They are dead weight on the tax roles and cost the city and county a lot
to manage.
Taxation measures and procedures for handling delinquent properties are established
through state legislation, and vary from state to state. Programs usually have a
provision for the foreclosure of deliquent parcels after a certain period of time. In
most cases, the sale price must cover the back taxes and any penalties assessed. States
which allow long periods of time to lapse before foreclosing on property many end up with
properties with such large costs due, that it would be difficult to find a purchaser.
Illinois, on the other hand, auctions off properties that have been delinquent five years
or more to the highest bidder, even if the bid will not cover the back taxes and fees.
In Colorado, tax delinquent properties are auctioned off each November. However, a
deed can not be applied for until three years after the sale, and ownership does not
actually transfer for another seven years. Because of these generous time limts, only
about 1% of the lands in tax sales end up owned by municipalities. Most properties revert
back to the original owner.
In Iowa, residential, vacant, tax delinquent lands are put up for sale, and back
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taxes are waived if affordable housing is constructed on the site. 1 The program has been
very successful in providing low and moderate income housing, and has helped to encourage
infill activity in declining areas. Most states, as in Colorado, do not have a provision
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for the forgiving of back taxes. Such a provision could help to move some of the
properties which add to the dead weight on the tax roles, and allow the locality input
into the type of development.
Cities could actively participate in the acquisition of tax delinquent properties
before back taxes and fees become phenomenal, and then could put the land up for sale to
the private sector for infill development.
The Duluth, Minnesota Housing and Redevelopment Authority has a program to acquire
and dispose of tax delinquent properties. The Authority uses the City's general fund to
pay back taxes, to purchase the land, and to publicize the land for sale. Anyone may
purchase the property if they can obtain financing and complete construction within one
and one-half years of purchase. The City combines this program with land price write
downs. Lots are sold at values which do not cover title clearance and administrative
costs. The City's general fund makes up the difference. In 2-1/2 years, 50 single family
homes were constructed on scattered lots throughout the City.^ Thus, the program has
proven to be an effective infill technique.
Fee Waivers
An additional incentive could be provided to builders in the form of eliminated or
reduced fees, to lower development costs. Fees assessed to projects include utility
hookups, subdivision filing fees, building permits, land dedication, drainage fees, park
development fees, etc. Each separate community has varying items and schedules of
assessment which it applies.
Many of a locality's operating costs are derived from the various fees which are
assessed to developments. Cities may be unwilling to give up this addition to the general
fund. This could be surmounted by restructuring the fee system to place the burden on
developments in portions of the city where development is being discouraged. In Omaha,
Nebraska sewer and plat fees are waived in inner-city areas, and higher fees are assessed
on fringe properties, in an effort to encourage infill development. City planners report
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an increase in central city development and a decrease in suburban areas since the system
was implemented in 1979. Planners feel that while the system provides an incentive for
infill development, it has not been the only reason this shift in development activity
occurred.^ A system such as this would help reduce the high cost often associated with
infill development, and at the same time would maintain the operating revenues of the
locality.
Phoenix, Arizona has targeted two areas of the city in which it is encouraging
infill. In these areas, the City has waived all building and planning related fees
including platting, variance, use permits, building permits, mechanical system
inspections, etc.-^ In most cases water and sewer hookups are also waived (only in cases
where the service charges are encumbered by bond issues are the assessed). In the first
year of the program's implementation, 80 housing units were started on vacant and
underutilized sites. It appears the program is experiencing some success.
If localities choose not to restructure their fee system to place a burden on fringe
areas, they may want to at least decrease their fees to compete with the unincorporated
areas. Fees are often higher in cities than in counties. A study conducted by the Center
for Urban Affairs at the University of Alabama in Birmingham found that estimated total
fees for a typical single family house was over 1,100% less in an outlying county of the
Birmingham area than in the city itself.^
Federal Assistance
Federal funding comes to communities through a variety of programs. Two of the main
programs are Community Development Block Grants (CDBG) and Urban Development
Action Grants (UDAG). The current federal administration has advocated the determination
of the use of federal funds by the receiving locality within set parameters. Thus,
funding to localities is not tied to categorical programs and communities have more leeway
in the determination of how funds will be used.
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CDBG's are one of the most commonly used resources for infill housing development.
Uses of CDBG funds must pass a two-fold test. First, the funds must be targeted for
blighted areas, and second, the program must benefit low and moderate income families.
Block grants can be used for site acquisition rehabilitation, infrastructure construction,
and construction financing, but may not be used for maintenance programs.
Denver has utilized a portion of its CDBG funds to help developers acquire sites for
infill development, by establishing a revolving loan program with low interest rates.
In Minneapolis, Minnesota CDBG funds were used to obtain an underutilized land parcel
for housing. Six single family detached homes were demolished and the site was developed
with eleven solar row homes. All units were sold within a year of construction and the
planning department reports that a great amount of interest has been stirred by the
project for similar proposals.-^
UDAG's are provided through another federal grant program which was created to
provide an incentive for private investment in distressed communities. Projects can be
spread throughout a community or the funds can be targeted to a defined area. Most often,
UDAG funds are used as loans to the private sector for the acquisiton of rehabilitation or
infill sites.
Denver has used a UDAG to accomplish infill in Lincoln Park. A $13.5 million loan
was used to leverage $100 million of private investments in the City and an addition of
1000 housing units.
Birmingham, Alabama used UDAG funds to provide second mortgates for scattered
infilling on vacant lots in built up areas. Interest rates were subsidized below market
rates.
In the South Bronx, New York City, UDAG, CDBG and Section 235 (federal homeownership
subsidy funds) were used to construct 250 units on vacant and underutilized land. A $3.7
million UDAG was used in combination with CDBG funds for minor demoliton and site
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preparation and relocation.^7
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Capital Improvement Program Priorities
It has been indicated that public service and facility deficiencies have been a
factor in deterring infill development. Thus, localities need to take steps to improve
the inadequacies of their infrastructure in order to allow the fact that the *
infrastructure is already in place to be an incentive to infilling.
Communities design capital improvement programs, anticipating the needs of the city
for public improvements, budget funds, determine the timetable for completion, and define
priorities all consistent with the goals and objectives of the community. The Capital
Improvements Program (CIP) is an essential part of master planning in which the facilities
and services necessary to support future growth and development of the community, plus the
maintenance needs of the existing community are defined. Funding for CIP's come from a
variety of sources; the issuance of general obligaiton bonds, the city's general fund,
CDBG funds, etc.
If infill development is indeed an objective of the community's, the completion of
infrastructure to serve infill or underutilized sites should be a priority in the CIP. A
community which feels that the CIP is benefiting only new development, will probably not
support these efforts. Therefore, it would be wise for the CIP to target infill sites in
built up areas, thereby benefiting both existing and new development.
Growth Management Techniques
There are a tremendous number of growth management programs which have been used
across the country. Following is a discussion of three techniques which could be used to
encourage infill development.
Urban and Rural Development Districts Systems of this vein are designed to
encourage the development of and which is most suitable for urban use. An area is defined
as an urban district. This is where urban development is to occur; the majority of the
land in the area would need to be developed before more land is incorporated into the
urban district.
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The urban/rural districts could be established through state designation, thereby
controlling areas that are outside a city's jurisdiction, or through intergovernmental
agreements between cities and counties. In such an agreement, the city and county jointly
determine what areas are designated for urbanization; development is discouraged in
rurally designated areas by both entities.
Commercial, industrial and residential development other than that of rural character
are not permitted in rural areas. As the municipality grows and develops, and more land
is necessary for additional development, redesignation occurs allocating more land for
urban uses.
Moritoria The implementation of moritoria consists of determination of where
development is occurring and is not desirable. A moritorium is imposed on the issuance of
building permits in this area. The goal is to redirect growth to areas where development
is desirable. In the case of infill development, 'desirable' development areas could be
those serviced by water, sewer, and other public infrastructure, with feasibility for
compact, efficient development. The moritorium is recinded when sufficient infill has
been achieved and additional land is necessary for development.
A moritorium could be placed on other city controlled items such as sewer and water
hookups. The City of Birmingham, Alabama has instituted a sewer hookup moritorium in
order to improve the area's treatment capacity. While this system was not designed to
specifically encourage infilling, sentiment exists that it may have provided the necessary
incentive to get developers to experiment with the use of vacant land in the city. The
Birmingham system, since it was not designed specifically to encourage infill development,
does have some loopholes which allow fringe development. For example, developers who
couldn't get sewer hookups merely applied for septic tank permits, which the county
granted.
A moritorium system designed to encourage infill should examine possible ways
builders may circumvent the system.
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