Zoning in Minneapolis

Parks, Minneapolis Public Schools, Density, Zoning, etc.
mattaudio
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Zoning in Minneapolis

Postby mattaudio » November 29th, 2012, 10:07 am

I know we discuss zoning as it relates to land use, so I'm not actually sure what the other types of zoning ordinances would be called. Many of these ordinances are frustratingly rigid and contrary to common sense.

A few of these can be found here:
http://www.minneapolismn.gov/licensing/ ... ment_index
Urban MSPers, consider yourselves lucky you take photos of buildings and not people from the public street space so as to avoid licensing requirements! Seriously, crazy.

Licenses are needed for coffee shops to put a few chairs outside during the summer, at a minimum of $400. A few years ago, Tillie's Bean (now closed) on 28th Ave and 38th Street had to quit with acoustic music in the coffee or pay another $400+ fee (and have no more than 3 musicians). Now these crazy ordinances have impacted Dusty's in Northeast, where my bands have played over the years. The regulations take into account the type of liquor license, how many musicians can be on stage, and if they can have amplifiers.

Why aren't we regulating negative impacts of land uses and business operations, instead of prescribing what can and cannot be done by businesses? Why not measure impacts to neighbors (SPL outside the building, for example) instead of having an ordinance that would allow Providence, RI noise rock duo Lightning Bolt, but not the nine-member New York Ukelele Orchestra... because obviously number of musicians is proportionate to volume and impacts to neighbors...

Is it just me, or is this crazy? It seems like parts of our city are thriving despite regulation, not because of it.

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Nick
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Re: Zoning in Minneapolis

Postby Nick » November 29th, 2012, 6:14 pm

I won't get into individual ordinances, because I'm sure there are individual things within the Code of Ordinances (not just zoning, but the whole thing) that look antiquated or arbitrary, especially when they're viewed from a certain context where you're not getting to do exactly what you want to do, when you want to do it, and how you want to do it.

But honestly, there are reasons why Minneapolis is a really nice city. A lot of it has to do with us being strict as hell in some categories. I'll kinda sorta say that working kinda sorta in code enforcement and kinda sorta in legal has kinda sorta taken away a lot of my faith in people lately. Without strict regulation, there would be unlicensed taxis driving 100 MPH down the Greenway, dogs mauling people on the Northside, "sidewalk seating" spilling over into streets, and housefires every day in Marcy-Holmes. In regards to costs and fees, keep in mind that it's expensive to maintain all that level of enforcement, and we ain't gettin' no love from the state for all the money we be sendin' them.

Apparently I'm turning into my dad way faster than I thought.

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Re: Zoning in Minneapolis

Postby mattaudio » November 30th, 2012, 8:01 am

The only legitimate regulation you cited was to prevent fires in rental housing... the rest basically just exists to ensure people perpetuate their own jobs. Existing unlicensed car hires do not egregiously break traffic laws. People do not let their dogs maul others if they wish to avoid defending themselves in civil court. Sidewalk seating doesn't spill over into streets if businesses wish to keep their guests from getting hit by cars.

I'm not saying we need to get rid of all regulations, but we just need to make them more common sense. How about "no live music that creates a noise level of x SPL outside an establishment." And how about "No sidewalk seating that encumbers or interferes with street use or the continuous width of sidewalk on a street." No $400+ annual barriers to business experimentation required.

I agree that all these ordinances were likely created with the best of intentions, but that's not good enough. We actually need to figure out if they're doing what they intend to do in the least invasive way possible.

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Re: Zoning in Minneapolis

Postby MNdible » November 30th, 2012, 9:24 am

mattaudio wrote:And how about "No sidewalk seating that encumbers or interferes with street use or the continuous width of sidewalk on a street." No $400+ annual barriers to business experimentation required.


They're using the public right of way rent free to make money. They don't own that sidewalk -- we do. I don't think a $400 license is egregious.

And complaint driven enforcement isn't a good way to run a railroad. The squeaky wheel will get the grease.

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Re: Zoning in Minneapolis

Postby mattaudio » November 30th, 2012, 9:30 am

"We" are "they" and "they" are "we" -- you could also say we want them to use our public right of way to create compelling spaces in our neighborhood.

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Re: Zoning in Minneapolis

Postby Nick » November 30th, 2012, 9:49 am

You're making an assumption that everyone is as put together and responsible as yourself, a person who, I'll gather from the post above, knows how to string complex thoughts together in sentences and arrange those sentences in a paragraph.

You acknowledge that there's a reason for strict licensing standards for rental housing, but why don't you extend that elsewhere? A dirty restaurant, a dangerous dog, and an uninspected cab can be just as hazardous.

Not trying to be combative on purpose, but it's really easy to wrap lax management in "freedom" and give people botulism or lead poisoning.

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Re: Zoning in Minneapolis

Postby MNdible » November 30th, 2012, 9:53 am

mattaudio wrote:"We" are "they" and "they" are "we" -- you could also say we want them to use our public right of way to create compelling spaces in our neighborhood.
We do. But I don't think a $400 (if that's what it is) fee is bad at all, considering that the layout needs to be approved, it needs to be inspected on a somewhat regular basis to ensure that the tables and chairs don't impede too much, and again, we're allowing them to perform commerce in the public right of way. I'd perhaps argue that the fee should be proportional to the number of seats or the area (maybe it is?), but now you're just making the regulations more complicated.

Running a city well costs money, and it requires regulations. Some of them may be onerous, but none of the ones you've cited thus far really seem to be that problematic.

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Re: Zoning in Minneapolis

Postby helsinki » December 3rd, 2012, 10:33 am

I think I can submit two regulatory mistakes we suffer from:

1. Parking minimums.

There is voluminous literature about this, but in short: parking minimums impose unnecessary and auto-centric costs on developers (inhibiting development/passing on costs on consumers) and result in a built environment hostile to alternative modes of transportation (walking, biking, public transportation). It limits density. It results in lots and lots of parking lots (which, I must add, are always idle, ugly, and dangerous. When they're empty, they're obviously idle. But even when they're full, they're idle, because nobody spends any time in a parking lot - it's a storage facility. A very voluminous one, because cars are large. The dead space that results is gargantuan).

2. Current form of Property Tax Assessment.

I was only made aware of this the other day, but it seems intuitively right to me. The current system assesses property taxes based on building improvements, ie the more improvements you have on a lot, the more taxes you pay. This stymies development. If, instead, you taxed the land itself (not the buildings; see http://en.wikipedia.org/wiki/Land_value_tax) you would pay a penalty for not developing, versus the current system that penalizes developing.

Indeed, the current system penalizes improvements to your own home. I was shocked to learn this all after listening to a Strong Towns podcast, but homeowners are generally taxed more (or even explicitly prohibited) if they build a so-called "mother in law" apartment on their property (attic, basement, above the garage, etc). This strikes me as a particularly pernicious regulation. In Germany, such "Omawohnungen" (Grandma Apt's) are nearly universal, and I think this is a great thing. It provides very inexpensive housing for seniors (or even students) and it allows multi-generational living, which I think is very important socially - our tendency to warehouse different age groups is bizarre (students in dorms, families in suburban homes, old people in retirement homes, etc - it's weird).

There are more harmful regulations, but these are two of the big ones, I think.

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Re: Zoning in Minneapolis

Postby MNdible » December 3rd, 2012, 11:13 am

helsinki wrote:1. Parking minimums.

There is voluminous literature about this, but in short: parking minimums impose unnecessary and auto-centric costs on developers (inhibiting development/passing on costs on consumers) and result in a built environment hostile to alternative modes of transportation (walking, biking, public transportation). It limits density. It results in lots and lots of parking lots (which, I must add, are always idle, ugly, and dangerous. When they're empty, they're obviously idle. But even when they're full, they're idle, because nobody spends any time in a parking lot - it's a storage facility. A very voluminous one, because cars are large. The dead space that results is gargantuan).
While this certainly has been the case over the past couple of decades, I think that the recent updates in Minneapolis have significantly reduced the minimums to the point that they are often below what the market requires.

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Re: Zoning in Minneapolis

Postby helsinki » December 3rd, 2012, 3:36 pm

MNdible wrote:recent updates in Minneapolis have significantly reduced the minimums to the point that they are often below what the market requires.
The market doesn't 'require' anything. If a developer or business owner makes the calculation that they can forgo parking, then this option should be open to him/her. Whether they succeed or not is their own business, no?

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Re: Zoning in Minneapolis

Postby mattaudio » December 3rd, 2012, 3:43 pm

I was going to say the same thing, in a different way. If Mpls now requires a lower parking minimum than what the market usually dictates, doesn't it reason we could scrap that regulation altogether?

My biggest beef remains with the live music ordinances. :)

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Re: Zoning in Minneapolis

Postby FISHMANPET » December 3rd, 2012, 3:59 pm

helsinki wrote: 2. Current form of Property Tax Assessment.

I was only made aware of this the other day, but it seems intuitively right to me. The current system assesses property taxes based on building improvements, ie the more improvements you have on a lot, the more taxes you pay. This stymies development. If, instead, you taxed the land itself (not the buildings; see http://en.wikipedia.org/wiki/Land_value_tax) you would pay a penalty for not developing, versus the current system that penalizes developing.

Indeed, the current system penalizes improvements to your own home. I was shocked to learn this all after listening to a Strong Towns podcast, but homeowners are generally taxed more (or even explicitly prohibited) if they build a so-called "mother in law" apartment on their property (attic, basement, above the garage, etc). This strikes me as a particularly pernicious regulation. In Germany, such "Omawohnungen" (Grandma Apt's) are nearly universal, and I think this is a great thing. It provides very inexpensive housing for seniors (or even students) and it allows multi-generational living, which I think is very important socially - our tendency to warehouse different age groups is bizarre (students in dorms, families in suburban homes, old people in retirement homes, etc - it's weird).

There are more harmful regulations, but these are two of the big ones, I think.
This isn't as boneheaded as you make it out to be, and is in fact the way property taxes work nearly everywhere in this country. Nowhere in the US is a pure land tax used. I don't really buy the notion that property value tax prevents improvements. The argument seems similar to the one that raising top end tax rates will cause people to not work as hard. On the margin, yes, increased property tax may negate any increase value from an improvement (more rent or just more space for the owner) but I don't think mill rates are high enough that it's really a concern (though I'd love to see some literature arguing otherwise).

I think Chuck's primary reason for advocating for a land tax is mostly to force people to develop parking lots, rather than to lift a restriction preventing more intense development of existing structures. Currently a parking lot isn't taxed very much because the property isn't worth very much in comparison to the office tower next door. In a LVT scheme, the taxes of that tower would go down, while the taxes for the parking lot would go up. A problem I can see with this is that it assumes that it's easy to develop the property into a use that can pay the tax bill, and I'm not sure that's always true. We could end up with rows and rows of "taxpayers" (http://www.flickr.com/photos/bluebike/3652824662/) but anything built now isn't going to be nearly as nice as what was built 100 years ago.

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Re: Zoning in Minneapolis

Postby MNdible » December 3rd, 2012, 4:11 pm

helsinki wrote:The market doesn't 'require' anything. If a developer or business owner makes the calculation that they can forgo parking, then this option should be open to him/her. Whether they succeed or not is their own business, no?


Um, what? The market requires many things. A good location, an appropriate level of amenities and finishes, and (in most locations) parking.

I tend to agree that if a developer chooses to not include parking, then that's their risk. I'm a bit ambivalent about this, because when business owners do this, it's usually not a calculated risk that they don't need parking, but rather that the on-street parking of the surrounding areas can support them. It's a way of shifting a cost off of their own bottom line.

But I think it's telling that since the requirements have been adjusted, we've seen very minimal requests for variances to reduce parking, and where we have, it's generally only been by a few spaces and they have almost always been granted. In fact, the biggest brawl over parking that we've seen lately was Stanton's variance request to exceed the parking maximums in the downtown parking overlay district.

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Re: Zoning in Minneapolis

Postby mattaudio » December 3rd, 2012, 4:50 pm

MNdible wrote:... it's usually not a calculated risk that they don't need parking, but rather that the on-street parking of the surrounding areas can support them. It's a way of shifting a cost off of their own bottom line.
Doesn't this just mean that we the people of Minneapolis, or any other city, are suckers for providing subsidized on-street parking to anyone who wants it? To think that we should mandate private party subsidies from some renters/land users to others as a way to make sure we don't have pressure on the existing public subsidy we give everyone in the form of free on street parking seems doubly crazy.

The solution is to 1) have no parking minimums for private developers and 2) make sure people parking on the street pay the market price of their car storage, or at least have it cover the cost to maintain an extra lane of street.
FISHMANPET wrote: The argument seems similar to the one that raising top end tax rates will cause people to not work as hard.
There's one fundamental difference. With a marginal increase in income, I'm still positive cash flow minus my top marginal tax rate. I'm still coming out ahead even if the government is taking a slice. With property taxes, I either have to realize an immediate boost in cash flow from rental of the property or capital gains from sale of the property to even have the potential to stay in positive territory.

If I add a housing unit on my property and the assessed improvements line item increases by 50% and my property taxes increase by 33%, that's a net cost out of the gate... and there's no guarantee I will see any income which could offset that liability unless I KNOW I will see increased rent or increased capital gains from sale AT LEAST equal to the marginal property tax increase. Therefore, it is basically a disincentive to improve my property, as improvements would risk having less money as a result of investing in a neighborhood.

Instead, if we want healthy neighborhoods that retain and share value that can be captured, it's important to reduce the burdens which work counter to this aim. Land value tax means people have incentive to make sure they are capturing all the improvement potential of their land to bring it to its highest and best use.

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Re: Zoning in Minneapolis

Postby Nick » December 3rd, 2012, 5:03 pm

mattaudio wrote:
MNdible wrote:... it's usually not a calculated risk that they don't need parking, but rather that the on-street parking of the surrounding areas can support them. It's a way of shifting a cost off of their own bottom line.
Doesn't this just mean that we the people of Minneapolis, or any other city, are suckers for providing subsidized on-street parking to anyone who wants it? To think that we should mandate private party subsidies from some renters/land users to others as a way to make sure we don't have pressure on the existing public subsidy we give everyone in the form of free on street parking seems doubly crazy.

The solution is to 1) have no parking minimums for private developers and 2) make sure people parking on the street pay the market price of their car storage, or at least have it cover the cost to maintain an extra lane of street.
Well, we are suckers. What also sucks is that I can easily live in what's probably the Upper Midwest's most urban neighborhood without a car, but when people come visit they act like it was the Bataan Death March walking from Clifton to Oak Grove because parking in Loring Park sucks. There are only a handful of areas where you can live without a car easily, but to then go to those areas...something about a chicken and an egg.

That said, I agree with MNdible that the parking minimums are more about existing construction. In the same way the city can order some property owner to fix up a dilapidated house because of its impact on surrounding property values, it makes some sense to require parking without putting the whole burden on the public. I don't necessarily agree with them being implemented in every situation, but it makes sense in theory.

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Re: Zoning in Minneapolis

Postby MNdible » December 3rd, 2012, 5:08 pm

As for market vs. regulation, see also the current effort of Minneapolis Public Schools to expand parking at their new HQ, against the strong wishes of Minneapolis planning staff.

To be clear, I'm fully opposed to this expansion, but I just think that it's telling that the nature of the conversation really has shifted over the last couple of years.

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Re: Zoning in Minneapolis

Postby FISHMANPET » December 3rd, 2012, 5:21 pm

mattaudio wrote: If I add a housing unit on my property and the assessed improvements line item increases by 50% and my property taxes increase by 33%, that's a net cost out of the gate... and there's no guarantee I will see any income which could offset that liability unless I KNOW I will see increased rent or increased capital gains from sale AT LEAST equal to the marginal property tax increase. Therefore, it is basically a disincentive to improve my property, as improvements would risk having less money as a result of investing in a neighborhood.
Theoretically I understand this, but is there any evidence that this is actually happening? As a landowner, you wouldn't make that investment that increases your taxes by 33% unless you were going to get 33% more "benefit" out of the improvement. Are there actual cases where, in this example, the landowner would only see 10%-30% increase in "benefit" so they don't make the improvement?

And I don't think accessory apartments have anything to do with property vs land taxes. An accessory apartment will easily pay for itself with the paltry sum you collect from granny. Accessory apartments are a zoning issue (not that this thread, despite being called zoning, was actually about regulations, though we've turned it into zoning [parking minimums] and taxes)

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Re: Zoning in Minneapolis

Postby helsinki » December 4th, 2012, 3:58 am

MNdible wrote: [...] since the requirements have been adjusted, we've seen very minimal requests for variances to reduce parking, and where we have, it's generally only been by a few spaces and they have almost always been granted.[...]
This doesn't necessarily mean that parking minimum's don't have a deterrent effect.

Developers factor in the costs of government regulation when they build. Parking minimums are one of those costs. I don't think it's tenable to argue that eliminating this cost would have not incentivize development, or result in an increase in the number of units built on sites where construction with fewer units was feasible despite the city mandated parking minimum.

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Re: Zoning in Minneapolis

Postby mattaudio » December 5th, 2012, 8:21 am

Agreed.

Unfortunately, there's a trend across many of these bad regulations, and not just at the municipal level: They're used by incumbents to create barriers to new entrants in the marketplace. People and companies are using the government to protect their market share. It's sickening.

What other justification is there for the liquor spacing laws? What other justification is there for "I have more of a right to subsidized on-street car storage than a newcomer to my neighborhood!" What other justification is there for much of our zoning law?

People want to protect their assets, whether it's a housing unit in Linden Hills or a liquor store in Uptown, by preventing an increase in supply that the marketplace demands... thus supply is constricted and the equilibrium price is not achieved.

This ties in with "The Gated City" by Ryan Avent.

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Re: Zoning in Minneapolis

Postby MNdible » December 5th, 2012, 10:16 am

mattaudio wrote:What other justification is there for the liquor spacing laws? What other justification is there for "I have more of a right to subsidized on-street car storage than a newcomer to my neighborhood!" What other justification is there for much of our zoning law?

People want to protect their assets, whether it's a housing unit in Linden Hills or a liquor store in Uptown, by preventing an increase in supply that the marketplace demands... thus supply is constricted and the equilibrium price is not achieved.
This may be mostly the effect today, and especially in wealthier parts of the city where liquor stores have no negative impacts associated with them, excepting perhaps some major spikes in traffic and congestion. But please do understand that in poorer, less spit-polished areas of the city, there are real negative externalities associated with having a liquor store next to your house. Now imagine that there are two or three of them. And there's a pawn shop as well. And a tobacco store. None of these are necessarily bad on their own -- they all serve a purpose. But when you concentrate these uses, I think that you'd be naive to suggest that there aren't negative impacts associated with these uses.

That's the bulk of the zoning law in a nut shell. It's designed so that a property owner has some confidence as to what's likely to be built next door, and so they're protected to some extent from negative externalities. If I own a house, and you told me that the only thing that could be built next door is another house, I'm likely to invest money into my property. If you told me that they're allowed to build an abattoir next door, I'm not even going to waste money on a coat of paint.


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