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The battle over city growth.


Developers, Neighborhood Activists, City Hall Square Off Over The Future Of Little Rock

There's a fight brewing down at city hall that could have bigbuck implications for Little Rock. Real estate developer David Jones has raised the warning cry that forces are at work seeking to restrict development activity out west and impose a special tax on new construction in the area.

Jones, a former Little Rock planning commissioner most identified with Pavilion In The Park and other developments along Ark. Hwy. 10, is concerned this movement advocated by the Coalition of Little Rock Neighborhoods may gain momentum through a $150,000 growth management study the city is undertaking.

The coalition, made up of eight neighborhood associations, believes that older, more densely-populated neighborhoods are subsidizing city services provided to newer, less-populated neighborhoods in west Little Rock.

Members like coalition president Jim Lynch are confident the study will confirm their suspicion, and that steps will be necessary to remedy this imbalance.

A prime tool in accomplishing this is an impact fee, also known as a development fee, which is typically levied when developers take out a building permit.

In many regions such development fees exceed $5,000 per housing unit, according to the Urban Land Institute -- an independent nonprofit research and educational group.

Depending on the methodology used to derive an impact fee, which includes a host of variables, that could translate into hundreds if not thousands of dollars per housing unit on the local level.

Conversely, some believe that if a balance sheet approach is used to assess which areas of Little Rock contribute the most to supporting the city's infrastructure the numbers would show that west Little Rock is more than paying its way. * Faced with declining sources of revenue and fewer federal dollars, city officials may find it hard to pass up the cash that impact fees would generate.

In any case, everyone agrees that the city is at an important crossroads, and the growth management study will help pave the chosen path. The question is how smooth or bumpy the ride will be.

Control Or Management?

The city is in the formative stages of getting the three-phase growth management study off the ground. The study will examine how the city manages growth and the viability of such controls as impact fees.

The neighborhood coalition, business interests and others are already jockeying for position and bringing pressure to bear on how the study will be conducted and what if any changes might be considered fair game for implementation in 1992.

The city board of directors will make the final call, and some wonder if the deck is already stacked in favor of impact fees.

Sharon Priest, Dr. Hamp Roy and John Lewellen were all elected to office in November and all three board members were endorsed by the neighborhood coalition.

"I've heard those backdoor whispers too: Those Goddamn neighborhood groups are having too much influence at city hall," reports Jim Lynch, president of the neighborhood coalition. "Hey, I'm not seeing it."

Priest, Roy and Lewellen have all indicated they aren't in favor of development disincentives in west Little Rock -- or anywhere else. They lean toward creating incentives to help stimulate activity in older sections of the city to balance the new growth.

"We're not asking for one at the exclusion of the other," says Lynch in reference to old growth versus new. "We just want a balance of the two. I'm sorry, but it's 1990 and Little Rock is a big place. Are we to simply continue opening greenfield developments and leave the other parts of the city behind?"

But from his perspective, Jones thinks the growth management study is a plain vanilla disguise for unnecessary government interference -- bureaucratic meddling that could harm rather than help the city.

He further describes a growth management study as "a system whereby a city can actually restrict economic activity in specific areas of the city while attempting to usurp the private market place by forcibly directing development to areas of the city where the bureaucracy prefers it to occur."

Take the case of impact fees.

Impact fees are most often associated with rapidly growing communities experiencing escalating land prices. Few would argue that Little Rock fits that profile given current market conditions.

Places like Boulder, Colo., and San Clemente, Calif., have charged impact fees as high as $3,049 and $9,084 respectively. Little Rock has had little if any real growth during the past two decades, and there's reason to believe there's been an actual decline during the past five years.

"The coalition doesn't care about stopping development, but what they're attempting to do is make it more expensive and much more difficult for new neighborhoods to grow," Jones states. "They think growth will go back to their neighborhoods."

Study Status

The city planning staff is coordinating the growth management study. In the two-month, pre-study phase they will complete a first draft that will outline the parameters of the study.

"My next step is to get back with the coalition and others and work this up for an RFP [Request For Proposal] toward hiring a consultant to do the study," reports Jim Lawson, director of Neighborhood Revitalization and Planning.

The planning staff will merge the community input with the first draft, and a refined RFP will be presented to the planning commission and board of directors for review. Once approved, the city will advertise for bids from independent consultants to conduct the study.

The consultant will conduct Phase I of the study, a three-month inventory and analysis of the city's assets and past growth management practices that include:

* Infrastructure (streets, sewer and drainage).

* Public Facilities (fire and police service, libraries, schools and parks).

* Housing (single-family conditions, multi-family stock and public/private housing programs).

* Funding Sources (property taxes, sales tax, licenses, utility franchises, permits and fees and federal and other government revenue).

* Current Policies (annexation, sewer and water, land development, neighborhood revitalization, neighborhood preservation and extraterritorial zoning and subdivisions).

* Population, Housing and Business Projections (significant trends, five-year projections and 10-year projections).

* Future Needs Assessment (infrastructure, housing, revenues, public facilities and businesses).

* Fiscal Impact Analysis (review of 1986 fiscal impact analysis in the city's extraterritorial study, refine the study to analyze city expenditures in outlying areas, develop a computer model to measure cost of city services in old and new areas and develop a program to weigh the difference between revenues and costs for developing areas -- old and new).

This last item, fiscal impact analysis, is the red flag that catches the eye of David Jones.

Making Enemies

The pre-study phase is slated to wind up at the end of March, but that timetable is already showing signs of slippage.

Indications are the city will bump back the timetable on the Phase I to

* The actual study (April-June);

* Phase II, setting goals and priorities for a growth management policy (July 1991-February 1992);

* And Phase III implementation (March-May 1992).

"I'm less concerned about timetables than acceptance in certain quarters," remarks city manager Tom Dalton. "It's imperative to have as much community involvement as possible, as to what the goals and timetable are. We've had too many timetables placed in front of us like the Diamond Center."

The feasibility study on the Diamond Center is due in this week, and the city board will have an undefined time to sort through it before taking action. A

May election on the sales tax proposal, advocated by Diamond Center proponents, is still uncertain.

The neighborhood coalition wants the city to spend that penny sales tax on capital improvements around the city. That disagreement on priorities has already generated sparks.

Several weeks ago Gus Blass, a proponent of the Diamond Center, appeared before the city board and challenged the members to get behind the project while calling into question their civic-mindedness if they didn't.

Jim Lynch also spoke to the directors, urging them to show restraint and examine the fiscal ramifications before committing to the project.

Afterward, Blass cornered Lynch in the hallway outside the meeting. The old-line businessman grabbed Lynch's hand in an angry handshake.

"Congratulations, you just did the city a great disservice," Blass stated, releasing Lynch's hand in a throw-away gesture. "I hope you're happy; you just killed this project."

The confrontation was ironic considering Blass rankled the board with his battering ram presentation and probably did more to harm the Diamond Center cause than Lynch did.

It illustrates the neighborhood coalition isn't shying away from going against the big boys to push their agenda, and in the process they're making some powerful enemies.

"We've been warned that we're making some important people mad, and that we will get steamrolled," discloses neighborhood coalition member Cheryl Nichols. She declines to elaborate on that ominous point other than to acknowledge the threat is economic in nature, directed along the lines of steering clients away from her husband's law practice for instance.

"Presumably it would involve something like that," Nichols says.

There's been some initial movement to improve communications between the neighborhood coalition and the business community. Business leaders like Barnett Grace of First Commercial and Walter Smiley have attended coalition meetings at the invitation of its members.

Too Much Credibility?

David Jones for one believes the neighborhood coalition is a misnomer, and its agenda doesn't reflect the neighborhoods it purports to represent.

"I think they're given way too much credibility by the press in how broad their support is," Jones says.

Neighborhood associations representing the areas of Central High, Downtown, East End, Hillcrest, Pankey, Forest Hills and Broadmoor are all members of the coalition.

In the greater scheme of things, the coalition is just as representative of a segment of Little Rock as any other group. After all, 100 percent of the electorate is invited to choose the city's leaders, and only a fraction take time to vote. The same could be said about participation in the coalition. All neighborhood residents are invited to take part but only a fraction do.

The coalition has questioned the advisability of the city spending $175,000 per year for 10 years to help pay for the Chenal Parkway. But the roadway is a main artery, which the city has historically helped construct.

"My theory is that there is an obligation for the city to provide a certain percentage of all costs," the city's Jim Lawson says. "The developer picks up the other side of it."

The coalition concedes that Little Rock developers foot the bill for onsite improvements (streets, curbs, gutters, sewer lines and water lines). However, members have leveled criticism at the city for off-site improvements like the new transmission tower and radio system.

The new tower is designed to allow radio communications for police and other services in far west Little Rock. The coalition is unhappy the city is making that investment for such a sparsely populated area.

But city officials point out that an estimated 80 percent of the $5.2 million project is going to replace the city's antiquated radio system, which serves all of Little Rock. The remaining 20 percent is financed by the city's new 911 telephone surcharge.

Common Ground

In many areas, developers like David Jones agree with the coalition's goals.

The two sides agree on other issues such as city maintenance of sidewalks, increased efforts to enforce building codes and creating incentives for redevelopment and infill projects in older neighborhoods.

"I think anything we can do to encourage growth is great, as long as you don't use disincentives on the backside," David Jones remarks.

"Our basic point of contention is that the city needs to quit annexing property out there," says coalition member Cheryl Nichols. "Maybe we're not as at odds with developers as it seems. Maybe we can work out some policies and decisions that are beneficial to both of us."

"Frankly, I think all of this is healthy," Lynch states. "It shows the maturation of the political scene. We need to be talking about stuff like this."

PHOTO : MAKING ENEMIES: "We've been warned that we're making some important people mad, and that we will get steamrolled," discloses neighborhood coalition member Cheryl Nichols.

PHOTO : DAVID JONES: "The coalition doesn't care about stopping development, but what they're attempting to do is make it more expensive and much more difficult for new neighborhoods to grow. They think growth will go back to their neighborhoods."
COPYRIGHT 1991 Journal Publishing, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Little Rock, Arkansas real estate development debated
Author:Waldon, George
Publication:Arkansas Business
Date:Mar 11, 1991
Previous Article:Bank deal.
Next Article:Have wheels, will travel.

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