City Design for Economic Stability

The isolation of buildings with pavement, high-speed movement systems and left-over scraps of open space has led to the isolation of man within an abstract built environment. He has fled to the suburbs but he can never escape. Before the exodus, the law began to define excellent architecture with minimum standards that stressed separation with land use plans, random zoning requirements, subdivision standards and building regulations. Open space was addressed with building setback areas that could be paved. Intensity was addressed with building height limits that were not linked to economic stability. This partial vision was further obscured by conflicting measurement systems and property ownership concepts that led to further isolation. We are slowly coming to realize, however, that this collection of uncoordinated minimum standards does not address the scope of physical, social, psychological and economic issues facing the cities and suburbs we create to serve the shelter we build for the people we protect.

Architecture has an ancient responsibility to provide shelter for survival, but new symbiotic solutions must tame a growing demand that threatens to consume the planet with sprawl and the people with intensity.

If the challenge is accepted, architecture will enter a new period of city design. The effort will force it to enter the public arena, and this is where inspiration is greeted with skepticism until logic is defended with knowledge.

This is not all, however. The cities we build must fit within a built domain designed to protect our relationship with a natural domain that cannot be sacrificed for the sake of growth. Architecture as presently envisioned is a cellular unit of growth within The Shelter Division of The Built Environment. The Built Domain does not exist and there is no concept of a built environment constrained by its limits. The next level of awareness will recognize these relationships, and it can be led by architects who respond to population growth with three-dimensional city design that outlines architectural objectives within sustainable limits.

It may be startling to realize that open space is at the heart of this issue, but it offsets building mass and pavement to define intensity at the cellular level of urban growth. When open space and building height are specified in a city design, development capacity (gross building area) is simply a function of the parking solution and floor plan adopted. This simple specification, therefore, can be used to define the weave and texture of urban fabric throughout a city. It will remain an artistic exercise with little persuasive potential; however, until intensity (development capacity) options can be linked to their physical, social, psychological and economic implications.

I need to digress for a moment to explain the preceding paragraph. Urban form is building height and mass that emerges from a city’s open space pattern. The combination of pattern and form is called a city’s weave and texture. Intensity is the relationship of building mass and pavement to open space. Intensity defines the place created to shelter activity. The level of intensity introduced can be measured and correlated to the social, psychological and economic reactions produced. In other words, weave and texture produce context that is measurable and mathematically predictable. Context measurement permits existing context evaluation. Context forecasting permits city design based on research and accumulated knowledge of intensity. Intensity in turn influences our quality of life and its relationship to the open space we must protect within The Built and Natural Domains.

There are an infinite number of design options, but many involve unacceptable levels of high and low intensity that compromise public health, safety and welfare. (Public welfare is a dubious term that means a population’s physical, social, psychological and economic quality of life.) Intensity decisions involve an evaluation of forecasted options based on a common standard of measurement. (This is also called context measurement or development capacity and is covered in my book and software.) The goal is to link architecture to the public benefit of city design with economic documentation.  

I’ll try to explain with an example that will initially appear unrelated using Table 1.  Columns (A) and (B)  under “Accounting” in Table 1 represent a municipal balance sheet that shows a budget with total revenue (income) equal to total expense. Column (C) calculates the percentages involved, which reveal an over-reliance on estate tax revenue; weak income tax revenue typical of a bedroom suburb with no significant employment centers; and debt service expense that will increase to reduce maintenance and capital improvement potential unless restrained.

Column (D) is a departure from a typical balance sheet because it relates revenue to the net productive acres involved. These acres are noted at the top of the table under “Land Areas”, and they comprise 64.2% of the total. This means that 35.8% of the city is not only tax free, but a public expense requiring maintenance and capital improvement. The city residential and non-residential millage rates reveal that the city only retains approximately 10% from every real estate tax dollar collected because it does not wish to (and cannot politically) compete with the school system for this source of revenue.

Revenue per net city acre in Column (D) does not tell the story, however, because it averages income in Column (C) over the entire net taxable area of the city. Column (E) identifies revenue per net taxable acre in each land use category. The nonresidential data in Columns (C) and (F) show that the nonresidential revenue is 27.06% of the total but that it occupies only 12.06% of the net taxable land area. In fact, Column (F) shows that nonresidential income tax revenue is the only line item that exceeds its land use allocation. In a perfect world, each land use area percentage would at least equal its revenue percentage, but Column (F) shows all line items under-perform this target, except for nonresidential income tax revenue. This revenue offsets other losses but is not enough to continue prior services. Column (G) includes a thumbnail explanation for each percentage noted.

The city (suburb) derives $11,146 of income tax revenue per net nonresidential acre, which is far greater than any other source of revenue; but far less than that received from similar activities in better locations and newer buildings in other suburbs. (The problem is exacerbated by a 3 story building height limit throughout the suburb and a local street system that discourages arterial connections to the region.) The rest of its revenue sources are below the average needed to meet its expense per net acre, and it is already operating on a reduced budget. The problem is compounded by the increasing cost of maintenance with age and the fact that the encircled suburb cannot annex to change its land use allocation ratios even if it knew the ratios to seek. Without such knowledge, however, economic development and redevelopment continue to represent architectural gambles without a stable city design based on an economic strategy.

TABLE 2: Summary of Table 1

NOTE: The average revenue needed per net taxable acre to balance the city’s budget is $5,905.00.

A	B	C	D	E
Land use category	% of net taxable acres	% of total revenue	Revenue as % of net taxable acres C / B	Revenue per net acre
Residential	80.4%	57.45%	71.45%	$4,219
Nonresidential	12.06%	27.06%	224.4%	$13,250
Institutional	7.54%	3.57%	47.42%	$2,800
Other (unrelated to land)	n.a.	11.91%	n.a.	n.a.

The problem begins with city design that is unrelated to its economic potential. A farmer would find similar random crop allocation incomprehensible (see “The City is a Farm” on my blog), but we have planted the seeds of urban decay with this approach. A farmer would not plant crops without an expectation of yield and profit, but we have planted cities without a clue and continue to record declining performance and deterioration as a result.

From this perspective, architecture does not begin where engineering ends according to Walter Gropius. It never did. Architecture is strategy based on inspiration, logic and knowledge. It precedes engineering tactics and it begins with city design for a sustainable future. The separation of incompatible land use activities (city planning) may protect the public health and safety therefore; but this two-dimensional approach will not protect its physical, social, psychological and economic welfare when the yield from these activities cannot meet the expense required. Yield is produced by three-dimensional city design. City design is an architectural strategy to achieve economic stability with intensity options for planned activities. It must also be a plan for survival within a symbiotic built domain.

Every acre in a city represents potential revenue that is a function of its land use category, activity focus and intensity level. Land use is a two dimensional plan for activity separation. It cannot be objectively coordinated with economic stability without considering intensity. A land use category contains similar activities with different revenue implications. Intensity is a three-dimensional relationship of building mass and pavement to project open space that shelters activity. Project level intensity combines to form neighborhoods, districts, cities and regions. Building mass in this context means gross building area expressed in square feet or square meters. The amount of building mass that can be placed on an acre is primarily a function of the open space required, the height permitted, and the parking solution adopted to serve the need. (Intensity options can be forecast with Development Capacity Evaluation v.2 software, and are a function of the values entered in the design template associated with the forecast model chosen.)

When activity combines with intensity, one result is revenue. This is a public benefit from architecture that has received little attention because the average revenue potential per sq. ft. of activity sheltered is unavailable knowledge, but it has significant city design implications. In addition to this, intensity multiplies revenue, but few options could be explored with the graphic tools available. As a result, the focus has been on health and safety because welfare is a function of architecture and city design in an urbanized world. This public benefit cannot be forecast or evaluated with the knowledge available, but the software just mentioned has been created to forecast hundreds of intensity options in the time it would take to sketch one. Context knowledge from the measurement and evaluation of existing conditions will be needed to sift through the options. The average revenue potential per sq. ft. from activity options also remains to be defined, but is essential knowledge because intensity and activity combine to produce revenue. These are the elements of city design with architectural intensity that can produce public benefit with an improved quality of life.

When excellent architecture is a building, it will always stand in isolation at random  locations across the nation; and may stand across the street from ranch houses, strip malls, high-rise canyons and urban blight. When open space is excluded from the composition, architecture becomes a magnified symbol of isolation. It represents an excessively competitive culture that focuses on individual success in an artificial world. Some museum pieces amplify the symbolism with isolation on remote estates of successful competitors.

The concept of isolated excellence, however, excludes fundamental natural relationships recognized by indigenous peoples and their emerging environmental counterparts. The agrarian ideal of Thomas Jefferson ignored The Natural Domain, which he explored for settlement. The work of more recent designers, most notably Ian McHarg, has had limited impact because environmental benefit remains an abstract argument for many. When this work involves a residential bias, public benefit is even questionable given the data in Table 2.

City design can weave shelter, movement and life support together by using open space, but the attitude of cultures must change in response to subconscious awareness as old as our dependence on the planet. The architecture of city design also requires a better understanding of intensity options and their capacity, cost, revenue, investment and environmental potential. Competition will always remain, but adjustment is required to avoid consuming the planet with our singular focus on artificial goals of imaginary proportion. They can only lead to further isolation, decline and natural disruption.

This is an argument that relies on inspiration and logic. Success will require vast amounts of additional knowledge, and it represents a monumental challenge to future generations. Architecture has a chance to participate with city design if it chooses to accept the challenge. It has been a symbol of isolation during the recent urbanization of man, but it can become a symbol of his emerging symbiotic awareness. At this point, excellent architecture will protect the welfare of man with places of physical, social, psychological and economic benefit. It must not sacrifice human dignity and survival for the sake of health, safety and speculation within unsustainable sprawl.

In the end, architectural success will always be symbolized by the fine art of exceptional talent; but the architecture of city design can weave the form and appearance of this splendid isolation into a fabric and quality of life documented by economic benefit in a new period of symbiotic awareness.

POSTSCRIPT

Affluent residents in this city are paying increasing taxes and their streets are crumbling because of the millage rate section of Table 1. It shows that the city receives only 9.9% of the real estate tax paid per net acre, and residents do not realize that so little of this revenue reaches their local government to maintain services and infrastructure. It’s also amazing to note that many of these well-educated people do not realize that so little income tax revenue is available to compensate when a great majority work outside the city.

City services and maintenance are the foundation for real estate value, but appreciation has been emphasized by the school system in fund-raising campaigns. The difference has been ignored for the sake of harmony; but a good school system cannot compensate for increasingly visible signs of physical decline. In other words, a city maintains value. A school system influences appreciation. Ignoring one for the sake of the other may be politically expedient, but it is a recipe for decline that can only be corrected by a reallocation of a city’s activity and intensity ratios.  

TABLE 1: PRODUCTIVITY of a CITY’S LAND USE ALLOCATION
	gross acres	gross %		net taxable	net acres as	net acres as
LAND AREAS				acres	% of total net	% of total  gross
RESIDENTIAL	4,000	64.5%		3,200	80.40%	51.6%
COMMERCIAL	600	9.7%		480	12.06%	7.7%
INSTITUTIONAL	300	4.8%		300	7.54%	4.8%
PUBLIC	1,300	21.0%		0	0.00%	0.0%
ACRES	6,200	100.0%		3,980	100.00%	64.2%
MILLAGE RATES	residential	%		nonresidential		%
City: 6.29	6.138015	10.5%		6.290000		9.9%
County: 14.57	11.830000	20.3%		13.329492		20.9%
School: 74.66	39.549064	67.8%		43.042970		67.6%
Library: 1.00	0.850000	1.5%		1.000000		1.6%
	58.367079			63.662462
ACCOUNTING
A	B	C		D	E	F		G
								NOTES
	total revenue	revenue as % of total		revenue per NET city acre	revenue per net land use category acre	revenue % divided by land use category %
RESIDENTIAL LAND USE ALLOCATION - 3200 net acres						80.40%		80.4% of net taxable acres yield 57.45% of revenue
Total revenue						C / 80.4% =
Real estate tax	$4,150,000	17.66%		$1,043	$1,297	21.96%		low % reflects low city share
Income tax	$2,800,000	11.91%		$704	$875	14.82%		low % reflects employment in other cities where tax paid
Reciprocal income tax	$0	0.00%		$0	$0	0.00%		zero reflects 100% reciprocity with other cities
Estate tax	$3,200,000	13.62%		$804	$1,000	16.94%		high % reflects dependence on unreliable source
Permits and fees	$350,000	1.49%		$88	$109	1.85%		low % reflects fully developed suburb
Other	$3,000,000	12.77%		$754	$938	15.88%		percentage needs more detailed review
	$13,500,000	57.45%		$3,392	$4,219	71.45%
NONRESIDENTIAL LAND USE ALLOCATION - 480 net acres						12.06%		12.06% of net taxable acres yield 27.06 % of revenue
Total revenue						C/ 12.06% =
Real estate tax	$600,000	2.55%		$151	$1,250	21.17%		low % reflects low city millage rate
Income tax	$5,350,000	22.77%		$1,344	$11,146	188.77%		high % indicates only productive use of land
Permits and fees	$150,000	0.64%		$38	$313	5.29%		low % reflects fully developed suburb
Other	$260,000	1.11%		$65	$542	9.17%		percentage needs more detailed review
	$6,360,000	27.06%		$1,598	$13,250	224.4%
INSTITUTIONAL LAND USE ALLOCATION - 300 net acres						7.54%		7.54% of net taxable acres yield 3.57% of revenue
						C / 7.54% =
All sources	$840,000	3.57%		$211	$2,800	47.42%		indicates influence of one large institution
OTHER						N.A.		other income equals 11.91% of revenue
						N.A.
All sources	$2,800,000	11.91%		$704	$704	11.91%		misc. income significant but not related to land
	$23,500,000	100.00%		$5,905
TOTAL EXPENSE
Operating	$16,150,000	68.72%		$4,058				high % reflects inadequate negotiation
Maintenance	$4,100,000	17.45%		$1,030				low % for mature city indicates cutbacks
Debt Service	$2,400,000	10.21%		$603				increasing % begins to limit future options
Depreciated Assets	$850,000	3.62%		$214				equipment and location options for service delivery rarely evaluated
	$23,500,000	100.00%		$5,905