Monday, December 10, 2018

The Timberland Library Capital Facility Proposal was a reflection of our current reality

Timberland counties have changed a lot since the 1960s. Thurston County used to be about the same size as the other four counties. Now, all four combined are smaller than Thurston County.
So far, the dominant narrative about the now shelved Timberland Library capital facility proposal has been about the possible closures and consolidations of rural libraries. Hardly anywhere in the coverage is a good understanding of the balance of where Timberland's revenues come from and how that money is spent. It has been just calmly accepted that closing any rural library is a sin, notwithstanding gaps in service in other parts of the five county district.

Here's a link to the draft proposal. It generally calls for consolidation of rural libraries buildings and the roll out of different types of library models (like Open+) that could have expanded hours.

During my tenure (between 2010 and 2016) on the Timberland board, we had to twice explain to east Lewis County communities that despite them voting to annex into the district that we would not automatically open libraries in their cities. Toledo and Morton both annexed, and because of the nature of the district (TRL doesn't build libraries inside cities) and the budget (pretty thin), there was no way we'd vote to open new buildings.

The capital facilities proposal would have helped the board take a look at the hard issues of where to spend money, but unfortunately, the board of trustees put it back on the shelf in favor of what will probably be across he board budget cuts.

The capital facilities plan itself wasn't a step back from serving rural communities, but a recognition of how the demographics of the district have changed and how library services have changed. It was also an acknowledgment that for decades the district has served some rural areas at the detriment of others.

I saw this process fold out slow motion when we were discussing the future of library services in Amanda Park. We had the option to close or drastically scale back services there because of some facilities issues with the library building. Stepping back from Amanda Park would have allowed the district to provide some service to the North Coast (Taholah down to outside Ocean Shores), which has always been part of Timberland but has never been directly served. But at almost the last minute, Grays Harbor County came through with funding to save the Amanda Park library and services there, and dooming any expansion into the North Coast.

So, there's that, the choosing of one rural community over the other. Additionally, there is also the seemingly forced ignorance of leaders and activists in rural communities of how the library is even funded.

Take this passage from Brian Mittge in the Centralia Chronicle:
Timberland’s professional library administrators in their Tumwater headquarters should spend a lot more time out in their rural communities. They had planned an elaborate set of listening sessions. Maybe instead of that, they should also spend some time in the Randle mill a half mile from their library. Or go in the woods with some of those namesake loggers whose revenue still pays for a big chunk of Timberland’s operations.
Timber funds pay for less than 10 percent of Timberland's budget and have been a shrinking part of the revenue stream for years. They are also extremely volatile, meaning the library cannot count on them from year to year. Property taxes, on the other hand, are stable and are making up a larger and larger portion of the district budget.

I want to pause and make sure this point is heard, because this has been missing from the coverage of the library facility debate so far: Thurston County, where more than half of the people in the district live and who pay for more than half of the budget, only receives 41 percent of the expenditures from the district. 

In fact, next year, Thurston County residents will spend $1.4 million outside of their own county on library services in Pacific, Grays Harbor and Lewis County.

From the Capital Facilities Proposal:

And, this isn't just because Thurston County has the largest population, the most stable economy and valuable property. It also gets to the nature of the communities in Thurston County. It is simply just cheaper to provide library services in urban areas.

This is an interesting set of stats from the proposal:

Daily Cost per borrowerCost per circ
Grays Harbor $38.97$9.72
Lewis $31.72$8.11
Mason $35.10$9.47
Pacific $35.50$9.08
Thurston $22.89$5.92

It costs almost half per borrower and per circulated item to provide library services in Thurston County than it does in Grays Harbor County. And it cost significantly less than in any other county. This is because on average the libraries are larger and more popular, meaning economies of scale can be created making it less expensive per head to deliver services. People also live closer together, meaning no matter where you live in Olympia, Tumwater and most of Lacey, the trip to the library isn't too far.

I understand we're part of big library district. I understand that services in rural areas are harder and more expensive to deliver. But, I also want folks advocating for their branches in incorporated areas of rural counties to recognize that if my county were not part of an inter-county rural library district, we would have $1.4 million more to spend on library services. Pointing out to us that the library district was founded to provide services in the rural areas does not change the fact that if we left, we could maintain more than four Hoquiam-sized libraries in Thurston County.

Timberland Regional Library has a hard choice to make in the next year if we wan to stay afloat. We can cut services across all libraries and make them less valuable across the board. We can close and consolidate library services. We can also raise taxes.

But before we make those decisions, everyone needs to take a clear look at how this whole thing is put together.

Saturday, December 08, 2018

Reducing impact fees will be great, but we need to talk about how we built our city

Next week the Olympia City Council will talk about an ordinance that will lower impact fees for affordable housing.

More specifically, the ordinance will lower impact fees for "housing with a monthly housing expense that is no greater than 30 percent of 80 percent of the median family income." The idea is that since developers make the most money building high-end housing for people that can afford it, this will create an incentive to build less expensive housing for those who can't.

But in the short term, I think we should pull back and take a look at impact fees in general and what kind of housing this ordinance is likely to encourage.

First though, let's say that impact fees are a one time fee for initial impacts that a new house will have on Olympia. Things like new roads, new parks, new schools are paid for out of these fees. But, long-term maintenance of these public assets come out of property taxes that end up being paid on the value of each home. So, while the initial burden of new homes can be blunted by impact fees, long term maintenance is everyone's problem. And, that is when we get into choosing what kind of housing we choose to build.

Up until very recently, most of Olympia was locked into single family home only zoning. Now, more neighborhoods are open for what is called Missing Middle housing types, like duplexes, townhomes, etc. And, a lot of people are connecting this impact fee proposal to the Missing Middle proposal. Larry Dzieza's post on Nextdoor about the cut in impact fees is even called "Missing Middle Tax/Fee Cut for Developers."

What people aren't talking about is that so-called Missing Middle development leads to higher valued properties, which leads to more taxable value for the city in the long run.

Here is how that works.

Generally, downtown Olympia is pretty valuable to the city and produces a lot of tax revenue (here and here). This is generally because the auto-centered suburban development style just isn't as valuable.

Let's get to another good example of how this is working in Olympia. Take this block of densely packed housing along Jefferson:

This isn't likely anyone's favorite place in Olympia, it sits on a stretch of Jefferson that has train tracks and is just a good example of what kind of housing we used to build downtown. At at just less than 10 percent of an acre it is valued at $2,661,538.46 per acre. When you look at the map, you can see it isn't even out of the neighborhood in terms of value per acre.

Let's go a few miles south on 37th Street, south of Olympia High School a block or so. This is a neighborhood of single family homes in a neighborhood with no sidewalks, and though it is walking distance to two schools and a couple of churches, isn't really what anyone would consider walkable in general.

And, these four house, clocking in at just over an acre, are valued at 1,617,475.73 per acre.

And, looking at this map, you see very similar values per acre among the neighbors.

Another way to look at it is to think about what value is being lost to the city of Olympia by sea level rise. Downtown Olympia by 2095 (if we don't do anything) will lost about 370 acres and about $600,491,269 in total value. The land in low lying Olympia is valued at $1,631,769.75 per acre, Compared to the value of the land outside the inundation zone at $494,018.11.

So, coming back to the finances of the city. In the short run, we want more walkable neighborhoods filled with affordable housing of various sizes and types. So, we want to cut impact fees to help this happen. Single family housing is more expensive to the consumer (even using the data provided by opponents of the Missing Middle). But, because high density housing uses the land more efficiently, it ends up providing more taxes to the city itself, blunting the need for impact fees anyway.