Impact Fee Psychosis
Leninists and corporate shills make odd bedfellows at the Legislature
By Jim Scarantino
Impact fees have amazing powers. They can restore sense to the city's growth policies. But did you know they also induce pathological behavior? Impact fees can turn right-wing Republicans into Leninists and glib liberals. They also have a strange effect on populist Democrats, turning them into shills for corporate favoritism.
The Albuquerque City Council implemented the Planned Growth Strategy to remove distortions from the marketplace created by vast public subsidies for, primarily, residential development at the city's fringe. They required that new development pay actual costs of necessary infrastructure, such as streets, public safety facilities, parks, drainage structures, etc. If you're building on top of volcanic basalt a mile from the nearest street and sewer connection, adding new infrastructure will, obviously, cost more than if you're building Downtown where infrastructure is already in place.
The city demarcated a number of service areas, with corresponding fee schedules based upon their real costs of infrastructure construction. The highest fees match the highest costs for new infrastructure in three Westside sectors. But funds raised from the higher impact fees will also be spent within those sectors, so finally infrastructure will keep pace with Westside growth. Also, the public sector will no longer use massive subsidies to tilt the marketplace to favor one area over another. Socialism is to be purged from real estate development. Wonderful.
Except it turned Republicans in the New Mexico House of Representatives into Leninists. En masse, they voted for HB 805, which would have gutted the City's Planned Growth Strategy. They attempted to prohibit Albuquerque from accurately assessing impact fees by requiring it to charge a city-wide average of the costs of new development. That means that an efficient development in a part of the city with infrastructure already in place would pay more than its true costs. A development requiring costly public investment for new infrastructure would pay less than its actual costs. Republicans argued that inefficient new development shouldn't be "penalized" by having to pay its own way. Wealth should be shifted around to continue subsidizing more costly urban fringe growth.
Lenin would have put it this way: "From each according to his ability, to each according to his needs."
State Rep. Greg Payne, who paints himself as a conservative Republican, co-sponsored HB 805. Commissar Republican House Leader Ted Hobbs marshaled his troops and stormed the Winter Palace. Every Republican present voted for HB 805.
In his floor speech, Payne argued (unbeknownst to his constituents) that his district should be made to pay more to make up to the far Westside for inequities of the past when other areas of the city subsidized development in the Northeast Heights. He also argued that the Westside needed subsidies to catch up. His historical equation doesn't quite balance, because during the time the Heights was being built, there wasn't enough development on the Westside to generate subsidies for the Heights' infrastructure. Regardless, it is indeed surprising to hear a conservative arguing for what smacks loudly of '70s rationales for affirmative action and reparations.
On the other side of the aisle, Democrats morphed into corporate shills. State Sen. Bernadette Sanchez carried the legislation in the Senate. Reps Dan Silva and Henry "Kiki" Saavedra led the charge in the House. Neighborhood leaders explained to them that by preventing Albuquerque from accurately assessing impact fees, the Westside and southwest mesa would continue to be shortchanged on new infrastructure. Their pleas were disregarded.
At a meeting with the Southwest Area Neighborhoods coalition after the session, Sen. Sanchez and Rep. Silva finally explained their true motivation. They admitted they sought to benefit the shareholders of Westland Corporation, a large landholder on the southwest mesa. Sanchez and Silva essentially acknowledged they wanted the rest of the city to subsidize development of Westland's holdings. (As previously reported, the sons of Silva and Saavedra are Westland lobbyists).
Sanchez and Silva added a social justice patina to their explanation. They portray Westland as a traditional Hispano land grant, deserving of special care and attention. But Westland decades ago converted itself from the Atrisco Land Grant, organized around principles of community, culture and family, into a for-profit corporation, organized around the principle of greed.
The session expired before the legislation was enacted. Split-personality behavior, unfortunately, doesn't just go away. Its symptoms can recur. Unless Albuquerque citizens provide the cure, through awareness, calls, letters and activism, it could break out again in next year's Legislature.
Dr. Joe Valles, Westside Coalition president, requested that I provide a direct quote about what Greg Payne told him. Here it is: "[HB 805] isn't going anywhere. It doesn't have a chance. I just wanted to make a statement." Payne, though, worked quite hard to get HB 805 through the House.
The opinons expressed are solely those of the author. Scarantino can be reached at email@example.com
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