The Cost of Fringe Living

Photo by wyliepoon

A lot of people enjoying living in lower density communities. There are many perceived advantages, including less traffic, less noise, improved safety, and lower costs of buying a house (i.e. Drive Until You Qualify). Yet, it is important to recognize that living in lower density communities comes with significant long term additional costs.

This is remarkably illustrated in an article this week from Minneapolis StarTribune that looks into the cost of exurban development in that metro region:

the Minnesota Public Facilities Authority, an obscure state agency that dished out nearly $350 million, mainly in low-interest loans, to help exurban cities build sewer and water projects.

When home sales plunged, cities found themselves with fewer-than-expected residents to help foot the bill. That’s forced many of them to jack up their water and sewer rates for current homeowners and businesses.

Closer to home, the City of Mississauga is raising taxes significantly as three decades of rapid growth winds down:

The city was forced to take on its first external debt in decades this year to deal with the budget crunch, as reserve funds and development dollars dwindle following three decades of explosive growth.

Mississauga’s and Minneapolis’s experiences have also been demonstrated in research which has consistently shown that lower density communities have to pay more taxes to provide new infrastructure and that there is more of that infrastructure. More land is dedicated to roads, and there are more sewage and water facilities on per capita basis than in higher density communities.

Higher densities are simply more efficient and make infrastructure more financial sustainable. If we want to get serious about tackling debt, keeping taxes low, and building healthier communities, a good long term step would be to build denser communities and allow low density communities to become denser.

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