LAND USE, PLANNING, ZONING, AND ENVIRONMENTAL HAZARDS

LEARNING OBJECTIVESDefine planning and zoning. Explain how economic principles help to

determine land use.Cite reasons why the market system may not

maximize the net social benefits of land use.

LAND USE, PLANNING, ZONING, AND ENVIRONMENTAL HAZARDS

LEARNING OBJECTIVES

Identify two bases for legal attacks on zoning.Identify the principal provisions typically

contained in state growth management legislation.

Explain what is meant by the “new urbanism.”Identify the major types of environmental

hazards.

DETERMINING LAND USE

Real Estate Markets:allocate existing spacesupply and adapt space to meet changing needs

Two Land-Use Principles:As transportation costs increase, the value of

land tends to decrease relative to similar parcels with lower transportation costs.

As land prices increase, capital investment intensifies.

DETERMINING LAND USE

The Market SolutionAlthough market forces tend to produce

groups or patterns of land uses, economic advantage may also accrue to competing and inharmonious land uses.

Externalitiesnegative externalitiespositive externalities

PRIVATE RESTRICTIONS

Land use restrictions can take the form of restrictive covenants and easements in deeds and subdivision plats.

Two limitations of private restrictive covenants include:enforcement, andgeographic scope.

PUBLIC PLANNING FOR LAND-USE CONTROL

Public land-use planning involves the development of guidelines and criteria for the determination and control of future land uses in a community, or geographic area.

development of a comprehensive planPlanning Flexibility

PUDsperformance zoning

PUBLIC ZONING FOR LAND-USE CONTROL

Zoning is the regulation of land uses, population densities, and building types and sizes by ordering the uses of land according to zones, or special districtsConstruction quality & safety issues are

regulated by building codes, fire codes, or health & safety standards.

Zoning is intended to control negative externalities.

PUBLIC ZONING FOR LAND-USE CONTROL

Legality of ZoningThe Taking of IssueInverse Condemnation

INCONSISTENCIES WITH PRIVATE MARKET OUTCOMES

Land use planning and zoning attempt to control growth and minimize externalities; however, they may have unintended consequences.property value effectscongestionurban sprawl

Growth ManagementCommunities and states, particularly those

experiencing rapid growth, have attempted to “manage” growth in order to maintain adequate levels of infrastructure and service.

Methods include:adoption of comprehensive plansconcurrency and growth impact feeseconomic and environmental impact studiesurban service areas, extraterritorial

jurisdictionsgrowth limits and moratoriums

New UrbanismNew urbanism represents one method advanced

to “remedy” some of the typical problems that accompany urban growth (i.e., crime, congestion and isolation).

Design tenents include:small front-yard setbacks with front porchesnarrow residential streetsmixed-use (commercial / residential)

development

ENVIRONMENTAL HAZARDS

Government Regulationfederal, state, and local responsibilitiesowners responsibilities

Types of Hazardous Materials Include:asbestos, fiberglass, polychlorinated biphenyls

(PCBs), leaking underground storage tanks (LUSTs), lead paint, and radon.

ENVIRONMENTAL HAZARDS

Implications for Real Estate InvestorsProspective investors, developers and lenders

generally require environmental risk assessments.

Types of Environmental Risk AssessmentsPhase I EVAPhase II EVAPhase III EVA