Category: Housing

Fate can teach us fiscal sustainability

(Reading time: 5 minutes)

In a somewhat puzzling change of venue, Staunton’s city council will be meeting Wednesday evening to discuss the Comprehensive Plan update not at city hall—where its chambers have more room, better seating and the proceedings can be readily videotaped—but in the second-floor meeting room of the Staunton Public Library. The ostensible reason for this choice is to bring the discussion into more of a community setting, which doesn’t speak well of the council’s perspective on its own digs. But given that the community is invited to watch but not speak at this last public airing of the update before a council vote later in the month, you do have to wonder about the logic of it all.

But let me not quibble. With the deadline for public input now past, it will be interesting to see just which of the plan’s shortcomings will be addressed and how, and whether they will be deemed sufficient to send the whole exercise back to the Comprehensive Plan Commission for revisions. That seems unlikely, even though some of the update’s omissions are rather glaring, as I recently documented. That’s not how these meetings usually work.  But one of those omissions—any  acknowledgment of the city’s huge unfunded liability to replace a leaky and brittle century-old water delivery system—when viewed in the context of the McIntosh Village development, which recently received qualified approval, underscores an even more fundamental hole at the center of the plan: its failure to address issues of fiscal accountability. And that all by itself should compel a do-over.

Just as the “comprehensive” plan conveniently ignores major capital improvement expenses that will become unavoidable over the next 20 years, so the McIntosh Village application was processed without any true understanding of what it ultimately will cost the city. Unlike infill development, which is how the comprehensive plan assumes the city will add most new housing over the next couple of decades, and which benefits from existing city infrastructure, McIntosh Village will add 267 new homes over a five-year period. That’s 267 homes that will have to be serviced by thousands of feet of new roads, new curbs, new water lines, new sewer lines and new storm water management systems. Once in place, all that new infrastructure will become the city’s responsibility in perpetuity to maintain, upgrade as needed and eventually replace.  

How much will that cost? No clue. But as with the ignored water mains that supply Staunton with its water, this is the kind of predictable but significant expense that the Comprehensive Plan doesn’t recognize—not just at McIntosh Village, but in numerous other parts of the city where such development can be reasonably expected, such as the large open tracts zoned for low-density residential housing along Springhill Road. There simply is no city policy that requires a staff assessment of what financial obligations Staunton is accepting when it approves a new development.

A housing development isn’t only a financial burden, of course. Improved property adds to the real estate tax base, the residents who fill its homes presumably spend money in local businesses and thereby pay city sales tax, and so on. But just as any well-run business won’t undertake a significant expansion without preparing a spreadsheet that balances expected costs against anticipated revenues, a city shouldn’t willy-nilly take on 40- or 50-year obligations without a clear-eyed understanding of what that means for city residents.

This isn’t a revolutionary idea, although admittedly it remains somewhat rare among municipalities. But consider the example of a city northeast of Dallas, Texas, with a population of roughly 23,000, or just a bit smaller than Staunton. Fate—yes, that’s the name of the city—adopted its first comprehensive plan in 2015, then updated it five years later. It’s worth a look, if only to dispel any notion that the Lone Star State is completely allergic to any kind of land use planning. Apparently, that’s true for only some parts of the state.

As Fate would have it (sorry, couldn’t resist), any proposed developments within the city have to provide answers to four basic questions:

  • What infrastructure costs will be created?
  • What long-term maintenance obligations will result?
  • What tax revenue will be generated?
  • Does the math work over the long-term?

Or as the city explains at more length, its comprehensive plan includes a “fiscal sustainability” policy, which “means that over a long-term period the City of Fate will be able to cover its cost obligations and provide high service quality for its residents without major increases in property tax rates, high levels of debt through bond issuances, or degradation of city facilities due to lack of maintenance staff or resources. To maintain fiscal sustainability it is therefore critical that we  evaluate new development proposals not only against our adopted development regulations and construction standards but also in relation to the fiscal productivity of the project” [emphasis added].

There’s a whole lot more explanation in Fate’s comprehensive plan for anyone who wants to get into the weeds, including a definition of fiscal productivity and a sample of the spreadsheet the city uses in its evaluation, but the bottom line is simply this: “These contributions and costs are compared to one another to ultimately determine if a project is going to contribute to the long-term fiscal sustainability of the city, or whether it will serve as a financial drain on our city’s taxpayers.”  The remarkable thing about that statement is that it comes from a city marked by explosive growth, with a population that is expanding almost 8% annually—precisely the kind of city most susceptible to the municipal version of a Ponzi scheme, in which current residents get the benefit of a sudden infusion into the tax base while the cost of paying for its long-term obligations are kicked down the road.

We’re seeing now how that works out long-term, and it’s not pretty. But that doesn’t mean that we can’t adjust course for the benefit of future Stauntonians by having a comprehensive plan that adds fiscal sustainability to inclusivity, harmony, and all of the other aspirational values it embraces.

Absentee owners vs. Staunton NIMBY

(Reading time: 6 minutes)

One of the biggest housing developments ever proposed for Staunton recently cleared a number of procedural hurdles, gaining preliminary planning commission and city council approval to move forward with plans to build 267 single-family homes on the city’s south side. But despite providing a much-needed addition to the city’s housing stock, McIntosh Village is bringing with it a whole lot of angst and hair-pulling—and, we may hope, a lesson about property rights and the importance of being aware of what’s going on around us.

The city’s tentative thumbs-up to this outsized development comes with a score of caveats and requirements, many of which any project of this size would command, but many in response to objections raised by residents of the adjacent Green Spring Valley development. That includes such understandable concerns as the insufficient number of access roads to the property and the effects on neighboring homes of the blasting that will be needed for site development, as well as more conventional worries about increased stormwater run-off and increased local traffic.

But then there are the objections that suggest, bottom-line, that the only acceptable use of the 77-acres at issue is to leave them . . . undisturbed. To not build anything. One local resident said she had moved to Green Spring valley for its “quiet, peaceful nature.” Another lamented the destruction of the area’s “natural beauty” and urged that more trees in the development be preserved and a wider buffer be required. A third declared that he was “Staunton born and bred” and that while he wanted to see the city grow, he did not want it to change.  A fourth insisted that the reason the land in question had not been developed was because it isn’t suitable for development, which amounted to a snake-eating-its-tail kind of logic.

All this and more was delivered in public hearings and without obvious embarrassment at such a stunning display of entitled behavior. These were supposedly reasonable objections by one set of property owners about plans by other property owners to develop their land in conformity with existing zoning and other regulations—but what they really were was a complaint that someone was robbing them of a pastoral idyll that wasn’t theirs in the first place. Maybe, just maybe, they should have bought that land themselves . . .

. . . which is not as far-fetched as it might sound. It would, however, require more thought than the Green Spring Valley complainers exhibited. It also suggests that the neighbors of any sizeable piece of vacant land in Staunton should be asking the questions that Green Spring Valley residents didn’t: Who owns it? How much did they pay for it? What are their plans for how that land is to be used?

A first clue in this instance is the working name for the proposed development, McIntosh Village. That’s a reference to Bruce McIntosh II, a wealthy resident of Loudon County who lived in a 5,000-square-foot 1860 colonial house on 133 acres in Waterford until he died, three years ago. More than 30 years ago he sold one of this family’s two farms and invested the proceeds in Staunton and Augusta County real estate, but he never lived here. His land just sat there, idle, lulling folks into thinking this would be the status quo forever—until September of 2024, when Bruce McIntosh’s estate sold 11 contiguous parcels, amounting to slightly more than 100 acres, to Staunton Augusta Properties for a mere $500,000.

Let that sink in a moment. For less than the assessed value of just two of the homes backing onto the proposed new development, all the land for McIntosh Village—and then some—could have been purchased by the people who now are complaining that someone will be paving their paradise. Whether individually or as a group, perhaps united under the umbrella of a non-profit limited liability corporation, the people who are predicting a coming onslaught of noise, dust, earth tremors and radon gas could instead have bought their very own private park. But of course, that would have required forethought, research and planning, for which developers apparently have cornered the market. It would have meant someone looking out a window and musing, “Gee, I wonder what’s going to happen to all that empty land zoned R-2 just sitting there?”

Make no mistake: this isn’t the last time this sort of thing may happen. For all the nonsense emanating from city officials about Staunton running out of empty land, there’s still a surprising amount of it, and that’s without harping on whether it makes sense to have an ag-forestal area inside the city limits. And a fair proportion of that vacant land is owned by people who don’t live in Staunton, nor in Augusta County—people who, like Bruce McIntosh, view it merely as an investment, which is not the same as investing in Staunton.

Some of the vacant land is quite extensive, like the 34.3- acre parcel at 502 Old Greenville Road, or the 21.32 acres at 70 Carann Street, both zoned R-2 and both adjacent to the future McIntosh Village. The owner of the first parcel lives in Alabama. The owner of the second lives in Sacramento.  Or consider a couple of smaller parcels, such as the vacant four acres, zoned R-2 and R-3, directly behind the city’s new J&DR Court building. That owner lives in South Carolina. Then there’s a vacant 6.3 acres, zoned R-2, at 721 Paul Street, owned by someone in Charlottesville—closer to home, to be sure, but still at a remove. How much concern will any of those absentee owners have for the sensibilities of their neighbors when the time comes to unload their property?

Are there more absentee owners? Undoubtedly, but it doesn’t appear that anyone at the city has made an effort to track them, which means we’re always vulnerable to surprises like McIntosh Village. And absentee ownership, it should be noted, can carry negative consequences for developed property, too, as reflected in recurring complaints of neglect and deferred maintenance of rental housing, especially in the West End. When someone living in another state, or even in a distant part of Virginia, owns a rental property in Staunton solely as an “investment,” there’s little incentive in an extraordinarily tight housing market to do more than the bare minimum to maintain it.

At least the folks who eventually move into McIntosh Village will have paid for the property they live in. Maybe by then their neighbors will get over their resentments and make them feel welcome.

Follow the colored-dot road . . .

(Reading time: 17 minutes)

A draft of Staunton’s revised and updated Comprehensive Plan is out for review, following 18 months of data collection, meetings and pulse-taking—including hundreds of colored dots on a wall of easels—and presumably is heading for rapid city council adoption in early June. Public comments are being received until May 26. We should hope there are many.

As plans go, this latest iteration is an improvement over the original, which was adopted July 11, 2019—before Covid and before the post-pandemic explosion in real estate prices, an affordable housing crisis, devastating downtown floods and numerous other shifts in the firmament. That initial “plan” was far more descriptive than prescriptive, more a gazeteer than a road map suitable for navigating two decades. Its conservative approach meant the original plan avoided being derailed by the Covid era, but even on those few occasions when it tried to peer into the future it often missed the mark, as when it projected that Staunton’s population in 2040 would be 25,442—a number the current draft revises upward by 10%.

Predicting the future is tricky business, to be sure. But the 2019 plan also was hindered by its blinkered view of what properly falls within the city government’s scope of responsibilities, a perspective shaped at least as much by philosophy as by financial limitations. The plan’s view of housing, as “primarily a private system that is influenced by factors beyond those controlled by local government,” is perhaps the most egregious example of a hands-off attitude that produced a planning document with obvious blind spots. The result was a soulless slab of prose, devoid of vision or inspiration, suffocated by the expectation that the Staunton of 2040 would be just like Staunton in 2020 only more so.

The new draft, by contrast, takes a more expansive view of the city’s role, which is a welcome change. But it also goes to the opposite emotional extreme, so devoted to “vision” that it often reads like a romantic ode, a fulsome psalm to a city that is welcoming, vibrant, empowering, resilient, inclusive, thriving, harmonious, sustainable . . .  and on and on.  Fair enough—who wouldn’t want to live in a place like that?—but at some point it does become a repetitive blur. The new draft also is big on graphics and states forthrightly it intends to “minimize text,” which may be a nod to shortened attention spans but which undermines its credibility as a planning document. We think, analyze and plan more with words than with images, although images do provide a better complement to the whole “vision” thing.

But whether dry or frothy, both the original and the revision fall short of being either “comprehensive” or of being a “plan.” The update is more aspirational than the original, to be sure, but its attention to detail is erratic and uneven, ranging from the highly specific—even providing exact dollar amounts for specific sidewalk expenditures—to the kind of broad-brush statements of intent with which no one can quibble but with little or no guidance regarding how to get there. The lack of sufficient affordable housing, to offer just one example, is acknowledged as being “a foundational theme that touches nearly all chapters” of the plan, yet the housing section has the least number of proposed “tactics” of any of them, and even those few are wan at best.

Does it matter? On the plan’s own terms, it should. The Comprehensive Plan, according to its introduction, “guides Staunton’s efforts to update local ordinances, justifies city programs and initiatives, helps officials set budget priorities, and directs decisions or development applications.” In other words, the plan defines what’s important and what isn’t. If something isn’t in the plan, it doesn’t exist and stands a good chance of being overlooked. Any evaluation of the plan therefore should pay as much attention to what isn’t there as to what is.

Land Use

In the news business, it’s called burying the lede: starting a story with peripheral details, only getting around to the core concept many paragraphs later.  In the section on land use, the lede is buried in a grey table of “tactics” that makes passing but repeated mention of “updates to the Zoning Ordinance” to solve various problems (infill, residential development in commercial districts, cottage courts, accessory dwelling units, etc.) without any prior narrative introduction of the ordinance, its limitations, or whether the whole thing should be overhauled rather than be subjected to a thousand tweaks and cuts. Instead, the explanatory text preceding the “tactics” (recommendations) is replete with mostly generic drawings of various land uses and how they might be improved, seemingly borrowed from the Cincinnati Urban Design and Architecture Studio, together with concepts like “building to street ratios” that it doesn’t explain. It’s all very colorful, but given the lack of a comprehensive review of the zoning code, mostly unhelpful.

How much more useful would this have been if the plan’s drawings were of actual Staunton city blocks, the streets and existing buildings clearly labeled, together with a vigorous discussion of how Staunton currently assigns land use and how it might do so differently? As it is, an ostensibly comprehensive plan casually presents information that should—but doesn’t—elicit sharp questioning, such as its unquestioned endorsement of reserving nearly a quarter of the city’s land for “heritage farmland.” Should it?  Why? How is it sensible to set aside municipal acreage for cattle grazing when we’re surrounded by the state’s second largest agricultural county?

That’s not to say that the misleadingly labeled “ag-forestal” (much more ag than forest) corner of the city should be turned into suburbs, but that there is no sign that the comprehensive plan even considered alternative uses for the land.  It also plays into repeated nonsense like this statement: “Trends analysis indicates that roughly 86% of Staunton’s land is already developed, meaning future housing growth will rely primarily on reinvestment, infill development, and reuse of existing structures.”  That sounds dire, doesn’t it? But given that 22% of Staunton’s land mass is, as just noted, undeveloped agricultural land, it’s also absurd.

A more accurate—and helpful!—statement would be that “roughly 86% of Staunton’s land is already developed under current zoning constraints,” which opens the door to all kinds of fresh possibilities.  Zoning is something we invented. It’s something we could change. And if we did, it’s amazing how much land would abruptly be available for all sorts of urban designs.

Farmland aside, there are numerous examples of ostensibly “developed” but underutilized land in Staunton. Consider, for example, the commercially zoned dog-leg rectangle between N. Central and Augusta that runs from West Frederick to Pump Street. Covering approximately 7.5 acres, this three-block area is immediately adjacent to the much more densely occupied multi-use downtown area that is generally regarded as an example of enlightened land use. But what do we find here? Five financial institutions, two fast-food restaurants and a store-front church—eight buildings altogether, with a combined footprint a tad over 35,000 square feet, covering just 11% of the land they occupy. As for the other 289,000 square feet of that “developed” land? Mostly asphalt parking lots and driveways.

Imagine if, instead of all those borrowed graphics, the plan had mapped out this three-block expanse and showed how it could be redeveloped for maximum use and return on the dollar. Yes, the land is privately owned. But the private sector, more readily than government, recognizes how it benefits economically from greater density and its synergistic effect on business. What the private sector doesn’t have is the overarching vision and resources to assemble such a transformation. That’s where the comprehensive plan could make a difference.

Blind Spots

The unquestioned acceptance of continuing the ag-forestal land-use designation is symptomatic of a bigger problem within the comprehensive plan: that of failing to see or question what’s right in front of our faces.

Decaying churches

Staunton is chock-a-block with churches, many with congregations that are aging out and increasingly unable to support large sanctuaries. Some are relatively modest, others may include spacious grounds and additional buildings. But like aging parents with a house stuffed full of belongings that no one will know what to do with when they die, too many will pass away without proper dispensation of their assets.  For one example of what that looks like, see the former Bibleway Community Church on West Beverley, vacant for all of this decade and increasingly showing it.

Aging churches can be revitalized or repurposed in various ways, most notably but not solely as affordable housing. But whatever transformation may occur often requires the intervention of an outside agency, such as the city, working from an inventory that assesses which churches can continue to flourish and which ones need hospice care. Most critically, repurposing church properties typically requires someone else to initiate the conversation, since most aging congregations are reluctant to acknowledge they can no longer support their long-established houses of worship. That’s an understandably delicate exchange to have, but it only gets harder the longer it’s postponed.

Even without an inventory of an estimated 76 Staunton churches, there are a couple of obvious places where the comprehensive plan could get the ball rolling. The Marquis Memorial United Methodist Church on West Beverley, for instance, has more than two acres fronting on one of the city’s principal gateways, as well as several vacant and near-vacant buildings. It also has a dwindling congregation and can afford only a part-time pastor. Heating and cooling costs for its large sanctuary are so high that the church frequently holds services in other spaces on the property that have lower ceilings. How much more productively could that property be used?

Or consider Christ United Methodist Church on Churchville Avenue, also a Staunton gateway. A potential candidate for revitalization rather than repurposing, Christ United sits on five acres that present several development possibilities. Some of that land, for example, could be used for housing or a mixed-use development that would generate revenue for the church, thereby creating an income stream that offsets declining financial support from a diminishing congregation. But here, too, it might take creative city outreach to set such a change in motion.

Other iffy assets

Numerous though they are, Staunton’s churches are hardly the only large buildings that are under-utilized or facing obsolescence. Two of the most notable are the vacant and decaying Ingleside Resort, on the north end of town, and the spooky, shuttered sanitarium next to the Frontier Culture Museum. The former apparently is mentioned nowhere in the comprehensive plan. The latter gets a nod in one of the two appendices, in which attendees at an open house suggested the “DeJarnette campus” has development potential. No explanation or context is provided for that description, which would be meaningless for Staunton residents without a good historical grounding, and no attempt is made in the plan to explore the development potential of either property.

An even larger property within the city, widely referenced by the plan as a notable asset while avoiding a direct examination of its precarious outlook, is Mary Baldwin University. The plan does make a brief suggestion that the city should “develop plans for what to do if the worst-case scenarios unfold,” but then fails to describe what those scenarios might be or how the city might respond. That’s unfortunate. The university encompasses 58 acres of prime land and multiple buildings, including dorms that could be repurposed as low-income housing. While closing the campus would be a significant loss to the city, it would open other possibilities to which Staunton should be ready to respond in a timely fashion.

In addition to such major examples, Staunton has numerous vacant buildings whose existence the plan acknowledges but doesn’t address, beyond mentioning that it would be a good idea to inventory them. We’ve known that for years, of course, but for some reason such an inventory has yet to be assembled, which means the city is often flying blind when trying to match unmet needs with unused assets. One example is the city’s recurring failure to find space for a day shelter for the homeless—even though there is, and has been for quite some time, a vacant storefront right next to city hall, as well as several vacant buildings on South Augusta Street, all of which would be more than sufficient for the purpose. And then there’s the former Coca Cola bottling plant at the intersection of Augusta and Churchville streets, which at one point was eyed as a possible brewery but which remains empty year after year.

How is that we have people who need a roof over their heads, and buildings that have roofs but no tenants? And how is it that such an obvious pairing of needs and resources goes unaddressed in the city’s “comprehensive” plan?

Infrastructure

Sewer and stormwater systems are among the infrastructure elements that make it possible for more than 25,000 people to live in close and supportive proximity to each other. But so is the network of water mains and pipes that delivers potable water to every city home and business, and while the comprehensive plan has much to say about storm water it is almost entirely silent about the drinking kind.

That may be the inevitable result of the very visible destruction caused by recent flooding, leading to the plan’s emphasis on storm water management, versus the comparative invisibility of the water that’s being moved underground. On the other hand, last year’s major water-main break came in the middle of the comprehensive plan’s drafting process and should have been top of mind. Instead, the plan says nothing at all about pipes that are now more than a century old, or about a water delivery system that loses more than one in every four gallons that are pumped into it—a rate nearly twice the national average—or about the $40 million to $50 million the city says it will need to fix these problems.

The city shows no sign of knowing where that money will come from. This plan won’t be any help in that regard.

Economic development

To read the comprehensive plan, you might think that the only economic vitality in Staunton is centered on the downtown area, and that the only kind of business the city wants to attract is the kind that plays well with tourists: outdoor recreation, arts and music festivals, restaurants, galleries, theaters, pop-up markets and so on. If the city wants to attract manufacturing of any sort, you wouldn’t know it from this document. Nor would you know what kind of business development the city would like to see along Greenville Avenue or Route 250.

But the plan’s biggest economic oversight is the blind-eye it turns toward Staunton Crossing, which it mentions not at all despite the millions of dollars already poured into that industrial park’s development. That may be because among the park’s targeted industries is a data center, with all the electricity and water consumption issues and controversy that entails—reason enough, perhaps, to just pretend that there’s no “there” there. Unfortunately, that also means there is no consideration in the plan of possible alternatives for the park, such as manufactured housing or solar panels and batteries, which would create many more long-term jobs than a data center and at a far lower social and environmental cost.  

 Ignoring the inevitable

Unlike blind spots, which refer to things the plan simply doesn’t acknowledge, there are several problems or issues the comprehensive plan does see—and then ignores.  

Homelessness

As mentioned above, the new comprehensive plan goes where the old one didn’t by recognizing the centrality of housing to virtually every aspect of the city’s vitality, from economic development to meeting educational needs to community health. And as have other plans that seek community input, the draft plan acknowledges public concern about the consequences of inadequate affordable housing. When plan consultants conducted what they describe as “public intercepts,” housing was the number one concern voiced by the people they encountered, by far. Attendees at an open house highlighted “the lack of focus on vulnerable populations, particularly homelessness, in current plans.”   Vision statements for the city called for “more services for the unhoused.”

So it comes as a surprise that the comprehensive plan presents not even one suggestion for meeting the needs of people who lose their homes, even as it gives pro forma recognition to “the challenges faced by people facing homelessness.” Instead, it deflects. Housing is a “national issue,” the plan explains, presumably as much beyond local control as climate change. “Local efforts are unlikely to ‘solve’ the housing affordability problem.” (Bye-bye, Staunton Housing Commission?)

But failing to “solve” the housing affordability problem, it should go without saying, only guarantees that the number of people who are homeless will continue to grow. Indeed, Alec Gunn, executive director of the Waynesboro Area Relief Ministries, says that demand this past winter for overnight emergency shelter grew 26% over the previous year, even as the number of churches willing to provide such shelter is declining. Efforts to create a day shelter for the homeless have been even more ragged, with a church that was intermittently open for that purpose last summer—a first—declining to do so again this year.

Regarding all this and more having to do with homelessness, the comprehensive plan is silent.

Student population growth

While the plan draft acknowledges that Staunton’s public schools are at or beyond “functional capacity,” its forecast of what that means for the future is tentative at best—even as it cites the possibility of “urgent space management.” “If” current population growth continues, the plan states, “further modular units and long-term facility expansions will be necessary.” But the plan makes no effort to project how much the student population may grow, or in what parts of the city, basically deferring to Staunton City Schools to “assess current conditions and identify future infrastructure, modernization and capacity needs.”

That may be appropriate in jurisdictions where there is greater distance between municipal and pedagogical governance, but the two are intertwined more tightly in Staunton. The city, because of its planning and zoning responsibilities, is in a better position than the school district to assess future growth patterns. At the same time, the city inevitably will be involved in whatever financing is needed for new school buildings, and possibly for expansion or renovation of existing facilities, suggesting that city planning for such developments should be more proactive than the comprehensive plan contemplates.

In closing . . .

To the extent that the revised comprehensive plan is more user-friendly than its predecessor, thanks to more graphics and minimized text, it may pull in more eyeballs and thereby increase public engagement. That’s a good thing. The not-so-good thing is that such overly visual and summarized presentations tend to diminish critical analysis, acting like cotton candy for the brain: long on mouth-feel, but neither filling nor nutritious.

Much of what the comprehensive plan presents is a distillation of the aspirational and critical comments it received from the public in multiple forums—and yes, that’s also a good thing. But most of that feedback was in response to alternatives presented by the plan’s architects (for this feature, do you prefer A or B?), which means public input was largely limited to the subjects and choices it was given. That’s why the plan has so many blind spots, and presumably many more than the few I’ve offered. And when the public was given a more open-ended opportunity to voice concerns, subjects it raised that didn’t fit within the plan’s parameters often would be acknowledged but then ignored.

Making 20-year decisions based on how many colored dots ended up on a series of easels, which was one of the primary methods used to solicit public feedback,  is better than casting a series of animal bones onto a blanket to divine the future. But not that much better.

Staunton’s cross(ing) is hard to bear

(Reading time: 6 minutes)

We’re now more than three weeks into the 90-day timetable Tim Davey gave Staunton City Council for updating the Staunton Crossing master plan, and so far there’s been no word on how or when this process will begin, or how the city’s residents will be included. That’s a problem, and more so if the city is seriously thinking of trying to land a data center.

For those who missed my earlier write-up on the subject, Davey, director of economic development for the Timmons Group, addressed the city council April 9 to acknowledge that “a long time” had passed since Timmons designed Staunton Crossing. Despite that lengthy hiatus, during which data centers have exploded in number, size and recognized adverse environmental impacts, Davey argued they should remain in the recruiting mix, if only because of the tax revenue one or more such centers would generate for the city.

Along the way, Davey also mentioned, almost parenthetically, that a data center might need its own on-site electrical plant, which these days is the industry response to widespread uproar over the higher electricity rates such centers cause. That would be a new and seemingly significant change to the Crossing’s master plan, especially since the industry’s default option in such cases has been gas-fired generators, which add to local noise and air pollution. Then again, Davey did mention the possibility of a “small” nuclear reactor. Either way, it seems that Staunton’s residents might have some thoughts on the subject.

Davey was equally blithe—and seemingly misleading—in his response to concerns about how much of the city’s water supply would be consumed by a data center. Those concerns have at least two sources. One is the city’s fragile, century-old system of feeder mains that increasingly is prone to catastrophic breaks and which already can’t account for 28% of the water pumped into it. The second is an increasingly erratic climate of precipitation extremes that includes periods of severe drought. The city doesn’t have the $50 million or so needed to beef up its water system, and it has no idea or plan for how to obtain it. And despite some recent showers, all of Virginia has been in a drought since last fall described as the most extreme in two decades.

But not to worry, Davey counseled—there’s always the possibility of recruiting a data center that uses a closed-loop cooling system, thereby limiting water demand. Note the tenuous nature of that “possibility.” Although closed-loop systems are indeed possible, most data centers don’t use them because they’re more complicated, involve higher upfront costs and typically require up to 40% more electricity to operate their additional pumps and heat exchangers, effectively swapping water and electricity burdens.

More to the point, it’s questionable just how much water is conserved by closed-loop systems. A closed-loop system simply means that the water used to cool the processors that comprise the bulk of all data centers—and which, incidentally, run at average temperatures of more than 188 degrees Fahrenheit—runs through a closed loop that passes through a heat exchanger. The other half of the heat exchanger is not a closed loop. The water in this outer loop absorbs the heat from the closed loop before passing through a water-cooling tower, in which it evaporates and thereby releases its heat into the atmosphere.  Cooling towers require a constant water flow to work, each day releasing hundreds of thousands of gallons into thin air.

That’s obviously a concern when long-term water availability is a question mark. But a similar  concern can be raised by pharmaceuticals, which Davey threw out as a new, possible recruitment target for the industrial park. To be fair, it was just a passing mention, so seemingly off-the-cuff that it provoked little follow-up from council members. It’s worth noting, however, that pharmaceutical manufacturing also is a thirsty business—so much so that the industry acknowledges it faces “major challenges in terms of water consumption with potential impacts on the environment and sustainability.”

That’s not to say that the possibility of a pharmaceutical manufacturer setting up shop in Staunton Crossing should be discarded. It is, however, a reminder that there are no silver bullets and that any industry will bring drawbacks as well as advantages. The trick is to publicly and honestly identify assets and liabilities alike, without minimizing costs or overstating benefits, so that everyone is given an opportunity to weigh trade-offs and draw his or her own conclusions about what is or isn’t acceptable. Thus far, at least, that seems not to have happened with Staunton Crossing—or not in nearly a decade, at any rate.

It’s also worth noting that the past decade has seen the development and even explosion of industries that scarcely existed when the Staunton Crossing masterplan was being drawn up—industries that Davey did not mention and that council members didn’t raise, but which should at least be in the mix of any “update” review. One obvious industry group sure to gain momentum in the years ahead, for example, is anything to do with renewable energy: photovoltaic panels, storage batteries, even electric vehicles of various sizes and applications if Staunton Crossing is large enough for their assembly plant. This sector includes newly developed perovskite-silicon cells that achieve 34% efficiency, solar paint, solar windows and thin-film solar panels—all technologies still in their early days, with lots of development potential ahead, unlike the data center boom that even Davey says is nearing an end.

Another industry group that has been ignored—and one that could have additional benefits for our affordable housing-starved area—is manufactured housing, with a particular focus on factory-built or prefab housing. Unlike data centers, which move electrons rather than physical products, a manufactured housing plant could take advantage of Staunton Crossing’s accessibility to rail and highway transportation networks, one of the industrial park’s presumed selling points. Moreover, off-site modular housing construction, like renewable energy products, is an industry of the future, with the U.S. playing catch-up to countries like Sweden, where prefabrication accounts for 84% of the residential market. The Netherlands (20%) and Japan (15%) likewise have a significant share of their homes built this way, compared to just 5% in the U.S.

There may be, on closer examination, convincing reasons why neither renewable energy nor factory-built housing (nor an unknown number of other industries one might think of) is a suitable match for Staunton Crossing. It may also be that they are desirable industries to recruit, but that finding and wooing them will take more work than simply opening the doors to the data centers that are sprouting up everywhere in Virginia like mushrooms after an (increasingly rare) soaking rain. But that’s why a three-month “refresh” of the Staunton Crossing master plan, off to a slow start at that, doesn’t seem like a sincere effort as much as a rush job toward a foregone conclusion.

The housing squeeze, part two

(Reading time: 8 minutes)

I recently wrote about the housing affordability crisis in our region (although we’re hardly unique) that can be summarized in just two numbers: a median home sales price in February of $330,000 (jumping to $347,250 in March) vs. a median Staunton wage income of $55,023. That puts the average home out of affordable reach of most two-earner households, never mind single-parent households, who then have no recourse but to lease a home—where, no surprise, they put greater upward pressure on that market, pushing local rents above $1,300 a month.

If wage incomes and housing costs were in balance, the market would respond by building more housing until equilibrium is restored. But while a lot of housing is in fact being built, it won’t do anything to relieve the affordability shortage because it costs too much. That’s not because developers are greedy, but because local incomes haven’t increased as much as have labor, materials and the other costs of building new homes. Those new homes will be sold to people moving in from elsewhere—and working elsewhere, where they’ll get paid more. In other words, what we have here is a broken economy.

When other aspects of a local economy are broken, we don’t expect it to miraculously heal itself. We turn to government, with its size and scale, rule-setting powers and taxing authority. If roads must be built or repaired to facilitate commerce, government does that. When economic inducements are needed to lure industry, government provides those. But when it comes to helping people get into affordable housing, well, that’s historically been a different story. People were expected to pull themselves up by their bootstraps, even when they didn’t have boots, and while that attitude is changing, it’s a long, slow process.

To be sure, there are government programs to help with housing—it’s just that they’re relatively few in number and rarely up to the task. Community Development Block Grants, for example, often are touted as one such source of help. But while Staunton has received such grants for several years, you’ll be hard-pressed to point to even one affordable housing unit that exists because of CDBG funding, with most of the money going instead to projects such as fixing sidewalks or getting a new kitchen for the Salvation Army. With the Trump administration now seeking to defund the CDBG program altogether, even those limited expenditures may soon seem fanciful.

Indeed, Trump’s budget proposals are consistent with a stubborn insistence on the extreme right  that we’ll never have sufficient affordable housing until government gets out of the way. “The states should reduce barriers to multifamily housing investment by cutting property taxes and liberalizing zoning and building regulations,” urged a Cato Institute spokesman in Congressional testimony last May, apparently oblivious to the fact that property taxes are set at the local level. Or, for that matter, oblivious to the necessity for raising property taxes in many localities.

Unfortunately, many of the libertarian Cato Institute’s simplistic remedies, and those of its philosophical soulmates, are given legs by their more telling critique of today’s status quo. Take just one example, made topical by a recent legal threat to derail an affordable housing project in Waynesboro, the first in our region since 2020 to benefit from the federal low-income housing tax credit (LIHTC). LIHTC apartments rent at below-market rates to families with incomes below the median income, which in our area are legion. They’re also nothing new to the area, in which developers used LIHTC funds for the first time in 2001 to renovate Fairfax Hall in Waynesboro, and subsequently added 968 rent-subsidized apartments and town homes at 11 separate locations in Waynesboro, Staunton and Augusta County. But getting to that point wasn’t easy, and now is becoming less so.

The way LIHTC works is thus: each year, the Internal Revenue Service distributes credits to the states, which in turn award them to developers to cover part of their costs of constructing or rehabbing apartment buildings. In exchange, the developers agree to cap rents for low-income tenants. The developers then sell the credits to investors to raise cash with which to start construction, giving investors equity in the projects and credits to apply against their tax returns over a 10-year period. That sounds like a win-win for most everyone—except that this process has grown into such a bureaucratic nightmare over the years that most builders won’t even pursue LIHTC projects.

It also provides Cato and other critics with their most powerful ammunition against “the growth of the welfare state.” For example, the LIHTC statute and related IRS regulations are 442 pages in length, the IRS auditing guide for the LIHTC is 344 pages, an IRS guide for LIHTC building compliance is 214 pages.  An industry guidebook to the program runs to 1,942 pages.  That’s a whole lot of deterrence against even applying for LIHTC certification, and it doesn’t end there: once such a project is completed, building owners must adhere to rent caps and tenant income limits for 30 years and keep records of each residents’ income, assets, and family composition.

Because of these and other LIHTC requirements, the cost of such units is significantly above those of non-subsidized housing. Those requirements also result in increasingly complicated financing packages, referred to as “capital stacks,” to underwrite construction. Such stacks consist of an array of government and other subsidies, each of which comes with its own rules and fees, and each of which takes time to cobble together, thus adding to the bottom line. The LIHTC cost disadvantage, according to various estimates, is around 20%, although it can be twice as high in more rural areas. That’s just so much raw meat for the free-market crowd.

No wonder, then, that the LIHTC train ground to a halt locally over the past six years, despite a dozen successful projects completed in the previous decade. Who can handle that kind of aggravation when there’s plenty of demand for new housing at more profitable market rates?

Last year, however, a non-profit developer of affordable homes, Enterprise Community Development, announced it would build Alston Court, a $35 million 96-unit apartment complex near the Texas Roadhouse in Waynesboro. All 96 units would be rented at affordable rates, according to Enterprise, meaning tenants would not pay more than 30% of their income for housing. Eight units would be reserved for households making less than $18,000 a year, which is just 30% of the local median income. An additional 75 units would be set aside for those making less than 60% of local median income, and 13 units would go to households making between 60% and 80% of the median. All that works out to monthly rent topping out at $1,200 a month—and dropping to less than $450 at the low-income end.

But having secured its LIHTC package, Enterprise Community Development had to assemble the capital stack needed to make it all work. It acquired $4.4 million from the state’s Affordable and Special Needs Housing program, a $560,000 grant from the Central Shenandoah Planning District Commission, a commitment of $125,000 from the Community Foundation and another $125,000 in smaller, three-year loans of $10,000 to $25,000 each from a variety of local organizations. It got a commitment from Valley Community Services Board to support 12 to 14 units through its permanent supportive housing program, and a promise from the Waynesboro Redevelopment and Housing Authority to likewise provide housing vouchers for the project. But that still left it $500,000 short of what was needed . . .

. . . and that’s when the City of Waynesboro agreed to pitch in with a grant to meet the shortfall. That’s also when city resident Mary McDermott, a retired telecommunications attorney, decided to get her dander up. As chronicled by the Augusta Free Press, McDermott fired off a letter April 15 protesting a city council vote to “donate” taxpayer dollars and threatening to sue the city in Circuit Court. No grounds for such a suit were outlined in McDermott’s letter, which lacked the rigor one would expect from someone educated at Harvard Law School and which seemed to consist primarily of McDermott’s belief that the grant should have been a loan. Moreover, the whole kerfuffle quickly blew over when McDermott decided just days later—also without much of an explanation—that she wouldn’t sue, after all. If nothing else, however, McDermott demonstrated how precarious such initiatives can be, thanks to their underlying complexity.

Meanwhile, as these numbers illustrate, even an experienced subsidized housing developer like Enterprise Community Development, which already has built more than 19,000 homes across Maryland, Pennsylvania, Washington, D.C., and Virginia, can be hard-pressed to keep its costs down because of the additional costs associated with LIHTC. Alston Court, it should be noted, will pencil out to nearly $365,000 a unit—more than the median sales price of new homes locally, and therefore just the kind of bloated initiative that gets the Cato Institute and its ilk all revved up. Forgoing subsidized housing, on the other hand, only means more people forced to live beyond their means in over-priced housing, many of whom invariably will end up on the street.

Rather than tossing the baby out with the bath water, isn’t it better to repair and streamline the rickety bureaucratic structure that makes affordable housing possible? Because, really, what else is there?

The housing squeeze, part one

(Reading time: 7 minutes)

To the casual observer, it must seem that we’re in the middle of one heckuva residential building boom—and indeed we are. In Staunton, several dozen apartments have been carved out of what were once commercial buildings, 130 apartments have been built off Middlebrook Avenue, and the planning commission is reviewing an application to build 267 single-family homes in a planned residential development at the end of Richie Boulevard. All that pales when compared to what’s going on in Waynesboro, however, where more than 1,200 new apartments, town homes and single-family homes are being built or have been recently completed, and several hundred more are being discussed.

So what’s with all the local angst about a lack of affordable housing? Aren’t we being swamped by new homes and apartments?

The answer to that lies in the word “affordable.” Yes, there’s a lot of ongoing construction, but all of the examples mentioned above are of homes that will be sold or rented at market rates—and the market is a beast. The house price index in Staunton, for example, rose from 100 in the year 2000 to 185 in 2020, which is to say, home prices rose 85% in that period, or an average of just over 4% a year. But by 2025 the index had jumped to 299.48, zipping along at a brisk 23% average annual increase. Translated into dollars, that boosted the February median home sales price in the Staunton-Augusta-Waynesboro (SAW) area to $330,000, according to local realtor Rick Kane, who’s been tracking these stats for a couple of decades.

Nor is renting a bargain. According to the city’s most recent consolidated plan, prepared as a requirement for receiving federal community development block grants, the fair market rent for a two-bedroom apartment—appropriate for a family with at least one child—in 2024 was $1,149 a month. Apartments.com, meanwhile, currently shows Staunton rents as averaging $$1,151 for a one-bedroom and $1,264 for two bedrooms. (Parenthetically, it’s noteworthy that 45% of all Staunton households with children have only one parent present, according to latest U.S. Census Bureau statistics.)

To put those numbers in perspective, consider that the federal standard for housing affordability is less than 30% of household income. Spending more than that puts you in the “cost-burdened” category, while spending more than 50% pushes you into “severely burdened” territory. To reasonably afford that market-rate two-bedroom apartment, a household would have to be earning $46,000 a year. Homeownership, no surprise, is even pricier: the $330,000 median home sales price will require a six-figure annual income unless the buyer comes in with a downpayment upwards of $66,000—and even then he or she will need an annual income of roughly $80,000.

Now consider this. The median annual wage income for Staunton’s full-time, year-round workforce, according to the most recent U.S. Census report, is $55,023. See the problem?

Unless a household has two wage earners, local homeownership is out of reasonable reach for most. So are rentals for the 1,651 full-time workers in Staunton that the U.S. Census says make less than $35,000 a year. A look at the city’s job openings illustrates how new employees almost invariably will be forced into the rental market: elementary school teachers, for example, start at $53,000, police officers at less than $51,000. The starting wage for a water treatment plant operator is $20 an hour, which works out to affordable rent of just $1,000 a month. Good luck finding such a place.

Many households, of course, have more than one wage-earner, which is why Staunton’s household median income is $11,000 higher than the median for wage-earners. And, of course, there is nothing ironclad about the 30% rule. People routinely pay more than 30% of their income to put a roof over their heads—but that’s the problem. The more someone spends on housing, the less there is for all of life’s other essentials, including food, transportation, health care, clothing and childcare. Small wonder, then, that the 2025 Community Needs Health Assessment prepared by Augusta Health reported that 25.8% of Staunton residents don’t have enough cash on hand to cover a $400 emergency expense.

One of the problems with such statistics is that they paint with a broad brush, glossing over the glaring disparities among various subgroups. This is especially true in any discussion of housing affordability, as illustrated by the graph above. Relatively few people making more than $75,000 a year will have trouble finding affordable housing, not only because they make more money but also because the housing market will have more choices for them. Conversely, those who make less than $30,000 are overwhelmingly cost-burdened, not only because they can’t afford much of a home but because they’ll be lucky to find anything in their price range. As a result, two-thirds of them get pushed into the “severely burdened” category, putting them one misstep away from being homeless.*

(While these bar charts are for the U.S. as a whole, they track the local situation pretty closely. For example, a statistically dated Central Shenandoah Planning District housing study released last year reported that more than 42% of Staunton and Waynesboro renters were cost-burdened, or roughly the percentage for 2019 shown above for “all renter households.”)

All of which raises the question: who’s going to be buying or renting all those new homes that are popping up in our two cities? And the obvious answer is: for the most part, not people who are already here. They can’t afford it.

Some of the new housing in Waynesboro undoubtedly will be snapped up by employees of Northrup-Grumman, which has a new plant that is filling more than 300 new jobs paying an average of $94,000 a year—but an estimated 80% of those jobs require four-year college degrees or more, suggesting many if not most will be filled by employees from elsewhere. But Waynesboro also has become increasingly attractive to a better-paid Charlottesville workforce searching for housing that’s more affordable on this side of Afton Mountain—and once you’ve crossed the Blue Ridge, Staunton is just an additional 20 minutes down the road. So presumably the developers behind all the new construction have looked at all that and concluded there’s a market demand they can meet.

The unmet market—the housing market for median wage earners already here—is another story. As the above analysis should illustrate, there are two sides of the affordable housing equation that can be addressed to make things equal: pay people more money, or build cheaper housing. Neither is about to magically happen, but there is a workaround: subsidize housing builders so they can sell or rent at below-market prices.

Unfortunately, that strikes some people as being, um . . . too much like socialism?

*The statement about homelessness is not hyperbolic. The usefulness of this year’s Point in Time (PIT) count of homeless people in the SAW region was limited because it coincided with the extreme ice storm that paralyzed the region, preventing census takers from seeking out those who were unsheltered. But even surveying just those who were in shelters underscored some troubling trends: 39% of the 157 respondents were homeless for the first time, and 29% were 55 or older. Unemployment and eviction were the two most common reasons they provided to explain their homelessness.

Next up: The housing squeeze, part two. Waynesboro leads the way toward a socialist utopia. Can trouble be far behind?

Rethinking Staunton Crossing

(Reading time: 4 minutes)

Much of tomorrow’s (April 9) Staunton city council meeting, which starts at 7 p.m., will be focused on next year’s budget and proposed increases in utility fees, neither of which is insignificant. But an even weightier matter, because of its long-term repercussions, will be taken up by council members at their work session preceding the regular meeting, when they will be presented with a long overdue “business plan update” for Staunton Crossing. What’s unclear is whether the “update” will include a reexamination of what should be built on this rather expensive chunk of real estate.

For the uninitiated, Staunton Crossing is a 300-acre site at the intersection of I-81 and U.S. 250 that is readily identified by its million-gallon water storage tank, perched on a concrete pillar abutting the interstate. The city purchased this acreage back in 2009 and spent nearly a decade figuring out what to do with it. A comprehensive design was finally prepared by the end of 2018, and millions of dollars have been spent before and since to pave the way for . . . well, that’s the question. Because while this project inched along, the rest of the world was hurtling into a once unimaginable future.

Case in point: one of the four core businesses envisioned for Staunton Crossing was, and is, a data center of the sort that has exploded across the country generally, and in Virginia most notably—indeed, the state now leads the nation with 579 such centers. As originally designed, Staunton Crossing’s data center would total more than 800,000 square feet, far exceeding the square footage occupied by offices (375,000), retail (162,300) or advanced manufacturing (a paltry 13,000 square feet). Various alternative options were also advanced, but in all of them the data center component remained unchanged—and, apparently, unchallenged.

There are several problems with this, not so much because of bad planning but because what seemed reasonable in 2018 is at least questionable today. Less than a million square feet of data center space might have seemed ambitious eight years ago, but today it’s quite a bit on the small side. The proliferation of data centers, primarily in northern Virginia but in other parts of the state as well, not only makes the Staunton site unremarkable but puts the city at a disadvantage for an industry that tends toward clustering. Most significantly, the metastasizing and increased size of these centers has highlighted just how environmentally taxing and destructive they are, driving up electricity and water consumption—and rates—while threatening air quality with their reliance on fossil fuel generators for back-up power.

The precarious state of Staunton’s water supply has been widely chronicled, due both to the aging-out of its supply infrastructure and because of our repeated drought alerts. Local electricity rates, meanwhile, have started climbing after years of being noticeably below those of other states, with Dominion Energy’s overall prices growing 11.6% over the past year and the generation portion of its bill increasing 16.8% over the same period, largely due to rising demand from all those energy-sucking data crunchers. Over the next year, Dominion ratepayers can expect to see another rate hike of around $11 a month.

There are, in other words, so many red flags popping up around the data center explosion that state lawmakers are mulling a slew of proposed regulatory and legislative constraints, raising the possibility that they will make Virginia an increasingly unattractive option for the industry. The feeling in Staunton should be mutual, but whether tomorrow’s business plan update will go in that direction remains to be seen. One line in the power-point presentation prepared by the Timmons Group is suggestive: on the “Current Trends” slide, item 4 is “AI Site Elimination vs Site Selection.” My vote would be for the first half of that equation.

One final note, sparked by that same slide. No. 6 on the list of current trends is the perennial question, “Where will my employees live?” Ironically, the original discussion of what should go into Staunton Crossing included the possibility of workforce housing—a possibility that was inexplicably dropped, with no known record of the thinking behind the exclusion. Eight years later, that looks remarkably short-sighted.

Staunton council is in a tax squeeze

(Reading time: 8 minutes)

As Staunton wrestles with the math of trying to make revenues match expenses, its options are actually quite limited. Roughly one-fifth of its income comes from the state, while a quarter or so comes from a grab-bag of smaller taxes that can’t be pushed much higher, primarily the local sales tax, restaurant meals tax and lodging tax.  But the biggest slice of the income pie, at just under half, comes from general property taxes, and by far the dominant segment of that category is real estate taxes. It’s therefore disconcerting to realize, after even a little analysis, just how self-defeating it is to pin our city’s fortunes on such an economically stupid way of raising money.

Not that Staunton, or any other city, has much choice. Real estate taxes are the one significant revenue tool left to municipalities by a state that reserves for itself the lion’s share of other taxes, such as taxes on income. Even with that, however, a city’s taxing ability is severely circumscribed by Virginia’s embrace of the Dillon rule, which essentially prevents any kind of municipal initiative that isn’t explicitly allowed by state law. The result is a rigid set of constraints that strangle innovation.

That’s too bad, because the way real estate taxes currently function has at least two hugely deleterious effects. One, as briefly explored in my post Sunday, is as a brake on Staunton’s ability to raise sufficient revenue to fix aging municipal infrastructure before it becomes unserviceable. The second is the way real estate taxes contribute to housing blight while simultaneously raising housing prices overall, making a significant contribution to the affordable housing crisis we’re currently experiencing.

To understand why that is, take a minute to consider how property taxes work. The rationale behind them is that the bulk of city services—roads, sewers, waterlines, fire protection and, to a significant extent, police protection—go to property, not people. And as the value of property rises, so too does the value of the services it receives, so the tax should increase accordingly. That seems straightforward enough, but here’s the question that tends to be overlooked: why does a property’s value increase?

Why, for example, does property in an urban core get valued more highly than in agricultural areas? As should be readily evident, a parcel’s value is highly dependent on what’s around it. You can buy a larger house on more land in a rural part of Augusta County for the same price you’ll pay for a smaller home on much less land in Newtown, largely because of the latter’s proximity to downtown and Gypsy Hill Park. Ready accessibility to shopping, recreation and cultural pursuits is worth a lot, as is not having to foot the bill for maintaining a well and septic system. A significant portion of land value, in other words, is collectively and publicly created.

Meanwhile, the value of what’s on that land also goes up as improvements are made, be it an addition, a renovated kitchen or bathrooms, new windows and doors or a new roof. As a result, the owner of a well-maintained home pays more tax than the owner of a poorly maintained house across the street, even though the city’s cost of maintaining a paved road and the utilities between them remains unchanged. In purely economic terms, therefore, a real estate tax provides a negative inducement for improving one’s property. A slumlord who neglects his property because he views it in cash-flow terms, not as a home that is building generational wealth, nevertheless profits from the improvements made by surrounding homeowners, who by their stewardship raise the value of all the properties in the area.

But that’s not all. When housing is in short supply, as is true in Staunton and most cities today, cheaper homes will appreciate faster than more expensive homes because of increased pricing pressure caused by unmet demand. In simple terms, a million-dollar home may appreciate only a couple of percentage points from one year to the next, while a home that a few years ago may have gone on the market for $150,000 will be listed today for nearly twice that amount, as anyone following Staunton’s real estate listings can attest.  That makes real estate taxes extraordinarily regressive, with low-income people getting priced out of homes they can no longer afford because their market value has gone up even as their actual value, measured by their physical condition, has deteriorated.

For numbers nerds eager to explore this subject more deeply, the University of Chicago’s property tax project provides a granular analysis of the subject nationally, with a look at Staunton’s 2023 property tax rates and their regressivity available here. This is truly wonky territory, but the bottom line is this: Staunton three years ago ranked as the 45th least regressive of the 131 Virginia cities and counties in the project’s sample, as its home values were above average nationwide and regressivity levels were in the bottom quartile. So compared to others, Staunton has been fairer than most.  

That’s the good news. The bad news is that the data is three years old, and since then the city has seen a 14.45% increase in the median residential assessment. More to the point, pressure on the city to raise revenue is only going to increase as its infrastructure demands keep growing, but hiking real estate taxes—the one significant revenue source over which the city has any control—would fall most heavily on those who can afford it least. Is there no escape?

TO BE SURE, there are a few workarounds Virginia has made available to taxing localities, chiefly in the form of tax exemptions for low-income homeowners. But that approach, while individually helpful, must be seen as a limited patchwork that only underscores how unevenly real estate taxes are applied and doesn’t solve the bigger problem.

One theoretical, if politically unlikely, solution would be to make real estate taxes explicitly progressive, in the same way that income is taxed progressively—those who make more get taxed at a higher rate. Under that approach, homes appraised below a certain level would be taxed very little or not at all, while higher appraisals would be taxed at progressively higher rates. Instead of the current rate of 91 cents per $100 of assessed value, for example, Staunton could have a rate of 85 cents per hundred for homes assessed below the current median value of $251,240, then increase the rate by 5 cents for every additional $50,000 in assessed value, to a maximum of $1.35 per hundred dollars for homes assessed at $750,000 or more. Which, as it happens, is the tax rate in Alexandria, which is no stranger to homes in that price range.

Yet another approach, and one with some academic credentials, is to tax land but not the improvements—or as summarized by conservative economist Milton Friedman (yes, yet another University of Chicago reference point), “the least bad tax is the property tax on the unimproved value of land.” That would at least eliminate the tax disincentive for investing in one’s property, even if it would not address the underlying problem of speculators benefiting from their neighbors’ investments.  Moreover, a land value tax (LVT) instead of the common real estate tax would be a huge deal for small land developers and builders, who don’t have the political muscle to push for tax abatements or other incentives. That could make a major difference for a city like Staunton that is trying to incentivize in-fill projects.

The curious thing about our current real estate taxes is that we already assess land and any improvements on it separately—but then combine the two into one assessment to which a single tax rate is applied. Theoretically, then, it would be a simple matter to separate the two and tax land at a higher rate, determined by its development potential, while dramatically reducing the tax rate on improvements that have already been made. Theoretically. Whether that’s even possible under the state’s Dillon rule is, however, questionable.

None of the exposition above will make any difference this Thursday, when the city council will be formally presented with next year’s budget. But it should prompt our elected officials and their administration to question what the city can do long-term to ensure adequate funding of our infrastructure while also protecting our most economically precarious residents, because without that discussion we’ll just find ourselves in the same bind—but worse—a year from now, and for many years after that.  That could mean pursuing one of the ideas above. It could mean something entirely different. Whatever it is, however, the real estate tax should be a leading candidate for reform, even if that requires an assault on the Dillon rule.   

Housing worries are making us sick

(Reading time: 7 minutes)

Tax season is fully upon us, so it’s only natural for people to grumble about the Internal Revenue Service. But here’s one undeniably good thing for which the taxman can take credit: because of an IRS rule dating back more than a decade, tax-exempt hospitals are required to periodically assess the health needs of the communities they serve. That’s the good news. The bad news, for anyone reading Augusta Health’s report card from last year, is that our health in some key areas has declined steadily since 2016, and a significant reason for that decline is housing affordability issues that weren’t even on the radar a decade ago.

Indeed, the most recent Community Health Needs Assessment (CHNA) provides a sharp contrast to the first in a series dating back to 2013. That freshman effort took a notably upbeat approach by noting that Augusta was the 31st most healthy county in the 20th healthiest state in the country. “Augusta County is living up to its motto ‘Let the ages return to the first golden period,’ referring to a period of simplicity and happiness,” it rhapsodized, in less than scientifically detached fashion. “In general, the Augusta County, Staunton, Waynesboro area outperforms the state averages for health status. Where local results fall at or below those levels, we see an opportunity for combined actions that result in improved community ratings.”

But then, in a prescient turn of phrase, it added: “There are several lifestyle gaps that need to be closed to move Augusta County toward greater overall health.”

Fast forward a dozen years, and last year’s CHNA indicates that those gaps not only were not closed, but that some grew into chasms.  While the 2012-13 assessment ranked chronic disease management, as well as health behaviors (“particularly related to obesity and physical activity”) as its top two health priorities, the 2025 ranking vaults mental health to the top spot. And although physical activity and weight retain their number two ranking, right on their heels as number three is housing, which scarcely registered in the earlier assessment.*  Meanwhile, chronic diseases, led by diabetes, trail behind in importance.

To be sure, the 2013 assessment was significantly more superficial than the reports that started coming out in 2016, when the grunt work was handed over to Professional Research Consultants and a 28-page report metastasized into a document nearly nine times as long. Moreover, the greater detail was complemented by a consistency of format, enabling comparisons across the three-year intervals that followed. The problem is that this consistency also highlights just how much backsliding has occurred.   

AMONG THE ASSESSMENT’S housing-related findings for Staunton (anyone wanting to focus more on Waynesboro or Augusta County can peruse the complete assessment here), nearly a third (32.1%) of residents worried or stressed over their rent or mortgage payments in the previous year—apparently with good reason, as 12.3% reported they had been displaced from their housing within the past two years, and 9.9% said they’d been homeless in that same time period. Another 11.2 % said they were living in unhealthy or unsafe conditions.

For the SAW region as a whole, the incidence of unhealthy or unsafe living conditions jumped significantly from 2019 to 2025, from 9.9% to 14%—but even more sharply for renters, to 19.5%, compared to 10.5% of homeowners. An even wider disparity between renters and homeowners was found in response to the question of housing instability, with 17.8% of renters in the SAW region saying they had to find emergency housing in the previous two years, compared to 4.8% of homeowners. Meanwhile, the overall incidence of housing instability in the SAW region doubled, from 5% in 2016 to 10.2% in 2025.

Homelessness in the SAW region—defined as adults reporting “a time in the past two years when they lived on the street, in a car, or in a temporary shelter”—was zero in 2016, then climbed steadily through each reporting period, to 6.8% in 2025.

The health consequences of being homeless or of living in unsafe housing can be intuited by most people, but less immediately obvious is the toll on mental health taken by persistent anxiety over losing the home one already has. And while there are numerous reasons for depression or suicidal ideation, the parallel growth of deteriorating mental health and of insufficient affordable housing strongly suggests a link. Indeed, as housing stress has grown significantly over the past decade, the area’s mental health has taken a dive:

  • Asked to rate their overall mental health, 21.9% of SAW adults believe it is only “fair” or “poor,” a 150% increase since 2016. Staunton leads the way on that metric, with 27.8% reporting fair or poor mental health.
  • A total of 41.7% of SAW adults (and 50.4% of Stauntonians) say they have had two or more years in their lives when they felt depressed or sad most days. The open-ended nature of that measurement would dilute its significance, were it not for the fact that it is nearly double the 21.8% reading in 2016.
  • More than a third (35.5%) of SAW adults say they have been professionally diagnosed as having a depressive disorder, a 138% increase from the 14.9% reported in 2016. Moreover, that incidence jumps to a whopping 47.1% of Staunton’s adults, which is more than twice the 20.4% incidence for Virginia overall.
  • Local residents aren’t just depressed; 17.2% of SAW adults say they feel that most days are “very” or “extremely” stressful—a percentage also up significantly from the 10.5% recorded in 2016. Staunton leads the pack on this metric as well, with 22.1% reporting they feel stressed out.

Such ailments, alas, afflict some demographic groups far more severely than others, with low income and LGBTQ+ respondents greatly over-represented in all negative ratings—demographic groups that also have less visibility within the larger community, and less political clout with which to address the issues that are making them sick. Nor, once they do get sick, are there adequate mental health and related services to provide the care that’s needed.

The CHNA includes literally scores of comments from local doctors, social services providers, community leaders and others, detailing what they believe are the reasons for this intractable morass. To be blunt, there isn’t much that’s revelatory, although some of the anecdotes—a 35-year-old father, working two jobs to house his family in a motel room, dying from a stress-induced heart attack—get at the human cost of the illness permeating our body politic.  And then there’s the occasional assessment item that further drives the point home, such as the finding that 19.3% of local adults acknowledge they have been “hit, slapped, pushed, kicked or otherwise hurt by an intimate partner.” That rate, too, has doubled since the 9.7% reported in 2016.

The problem with health exams, as all too many physicians know, is that patients will yes them to death—exercise, stop smoking, eat more nutritionally, cut down on the booze, yadda-yadda—and then go blithely on as though no red flags had been raised. So it seems with the 2025 CHNA’s section marked “evaluation of past activities.” Number two on its list of previous strategies was meeting the health care needs of the homeless through a four-pronged approach, all of which were implemented in 2023—and all but one, and then only minimally, going unaddressed in 2024, due to a vacant RN Health Educator position.

Vacant since November 2023, that is, or almost two years prior to the 2025 CHNA’s release.

It’s a near certainty that Augusta Health’s unfilled position is a result of budget constraints, but as with all such cuts, choices reflect priorities. Short-term rewards have a way of biting us in the ass down the road, and a high-salt, high-cholesterol diet almost invariably morphs into diabetes and obesity. But what are you going to do when it’s your doc who’s ignoring sound medical advice?

Meanwhile, it’s clear we have to move beyond discussing the lack of sufficient affordable housing simply in economic terms, or of viewing housing issues through a policy-making lens that bogs down in abstract philosophical differences. The lack of sufficient housing for city residents earning what passes for a living wage locally is a serious health issue every bit as insidious as lead poisoning, seeping into the populace largely unseen and unremarked until it explodes in seemingly inexplicable violence, depression and apathy. The 2025 CHNA waved several red flags. How many more such studies will we need to awaken us to the epidemic that’s underway?

* “Scarcely registered,” indeed. The single mention of housing in the 2013 CHNA was in a graph showing the SAW region’s top three health and community issues, in which “affordable housing” came in at no.21 of 22 issues overall.

On some tests a failing grade is better

(Reading time: 3 minutes)

Sometimes you can stumble across the most alarming news in the most unexpected places.

Case in point: Staunton today put out its February activity report, which includes a regular update on how many articles and stories have mentioned Staunton in the past month, as well as how many eyeballs may have seen them. Fourth on the list this time, with a “reach” of more than 40 million, was a piece on Realtor.com headlined, “Best Mountain Towns Where Homes Deliver the Strongest Airbnb Returns.”

Care to guess which “mountain town” came in tenth on the list? That would be Staunton, of course, where homes have a median listing price of either $370,000 or $418,000 (Realtor.com couldn’t settle on a single figure) and an “average annual revenue potential” of $43,000. “We are seeing investors with proven track records buy strategically in Staunton, where they know they can implement their knowledge of the market with robust design and differentiated amenities,” Realtor.com quotes Sydney Robertson, identified as a real estate agent with Loring Woodriff Real Estate Associates—which, as it happens, is based not in Staunton but in Charlottesville.

Robertson may be good at tossing word salads (“robust design and differentiated amenities”?), but it should be noted—especially since it was ignored by Realtor.com—that she also is chief sales officer for Carriage House STR. Carriage House, as of a couple of years ago, was operating scores of Airbnbs across central Virginia, including more than two-dozen in Staunton proper, to which it gave a thumbs-up for the city’s lack of short-term rental restrictions. So, not exactly a disinterested observer.

The list of mountain towns so conducive to making money for “investors” was created by AirDNA, a firm that compiles and analyzes Vrbo and Airbnb data. What makes cities like Staunton so attractive to people who think in terms of balance sheets, according to AirDNA chief economist Jamie Lane, is that all the really hot mountain destinations have gotten too expensive. That makes second-tier cities like ours look like bargains. “The markets on this list tend to benefit from steady, multiseason demand and more affordable home prices than those in top mountain destinations,” Lane elaborated. “That combination can create a more balanced investment profile, with strong revenue potential relative to acquisition costs.”

Just how much of a bargain Staunton represents is encapsulated by AirDNA’s ranking system, which looks at five variables to generate a score between 40 and 100. A score of 90-100 is an A. Waynesboro merited only a 70, Lexington and Winchester notched a slightly higher 74, but Staunton roared to the head of the class with a list-making 93. Which all sounds terrific for Staunton, until you realize that what’s being assessed is Staunton’s attractiveness for people who view housing as financial assets, not as homes.

The five variables feeding into this grade include investability, rental demand, revenue growth, seasonality and regulation—or, more accurately, the lack of regulation. Or to put it in English, Staunton offers high curb appeal year-round, with under-priced real estate compared to what the short-term rental market will pay. That may come as a surprise to Staunton residents who can’t find a house they can afford to buy, but that’s what happens when our housing supply is being picked over by people who don’t have to live here.

All the handwringing about Staunton’s lack of sufficient affordable housing is pointless as long as there’s essentially no city regulation of short-term rentals. Without it, the transformation of homes into business assets will continue, largely unseen and unchecked, and articles like this one reaching as many as 40 million people will only accelerate the process. That may be something for the new Staunton Housing Commission to ponder as it plots its future course.