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The Birth and Growth of Modern Zoning (Part III): FAR and Wide

Jason M. Barr (@JasonBarrRU)      November 1, 2021

If you ask someone familiar with New York City real estate about the birth of modern zoning, they’ll point to 1961, the year the city implemented the floor area ratio (FAR) as the primary method to control building density. Sixty years later, the FAR is still going strong and, arguably, is the most popular planning tool globally.

The FAR rules give the maximum allowable building area relative to the size of the lot. FARs are frequently set to less than one in suburban districts, forcing landowners to build single-family homes. In central areas, the base residential FAR can be as high as 10 or 12, allowing for high-rises. Central Paris, for example, is a FAR 3 town. By capping the FAR, cities implicitly dictate how many people can live or work in each neighborhood.

The Great Depression

Indeed, the FAR was created in New York. However, its conception emerged two and half decades before 1961, during the Great Depression. It circulated within Mayor Fiorello La Guardia’s administration, and, in 1940, the FAR was incorporated into revisions of the 1916 zoning codes to limit density in leafy, residential neighborhoods.

During the 1940s, the idea of capping FARs percolated in planning circles, spreading outward from New York like ripples in a pond. Planners had become convinced that the first generation of zoning codes, which radiated out of New York in 1916, was inadequate and unable to check the evils of urban density. The FAR had a certain simplicity and gave planners a degree of control that they could not get from other regulations. By the late 1940s, it was known FAR and wide. The irony is that New York was two decades late to its own party.

How did the FAR spread across the country? And why did New York dither as the world began to embrace it? To answer these questions, we must go back to 1935, while the Great Depression held the nation in its grip.

Robert D. Kohn and the Birth of the FAR

The story begins with the Regional Planning Association of American (RPAA). During its heyday in the 1920s, it was an informal group of architects, planners, and writers, troubled by the ills of urban life. It aimed to make cities more healthful by promoting deconcentration and decentralization.  RPAA members were inspired by their British counterparts, mostly notably Ebenezer Howard, Raymond Unwin, and Thomas Adams, who spearheaded the Garden City movement in the U.K.

In 1935, architect, reformer, and RPAA member Robert D. Kohn (1870-1953) led a housing committee at the City Club of New York, an organization devoted to promoting enlightened local policies. Kohn’s committee was established to weigh in on zoning reform. And it is Robert Kohn, more than any other individual, who was responsible for creating the floor area ratio. Kohn’s committee drafted a memo promoting the FAR to control housing density—the first time this idea appeared in print. The document also asked City Club President, Richard S. Childs, to push Mayor La Guardia to take up the mantle of zoning reform.

Kohn was assisted by architect, and City Club and RPAA member, Frederick L. Ackerman (1878–1950), who, in 1934, became the first Technical Director of New York City Housing (NYCHA). From there, he issued reports (screeds, really) on the evils of the free market and the inadequacy of the current zoning regulations. In a 1934 NYCHA report, co-written by William F. R. Ballard, he estimated that if the city was fully built out under the 1916 codes, it would have a resident population of 77 million and a daytime working population of 350 million.

No matter that these numbers were never realistically obtainable (New York’s population in 1930 was 6.9 million), they were cited in report and after report to motivate people to take zoning reform more seriously.

The Joint Committee

Child’s letter to La Guardia produced results. A new joint committee was formed with members of the Mayor’s Committee on City Planning and the City Club, which continued to recommend the implementation of FAR controls. This report was followed by yet another in 1938, entitled “Zoning for the City of New York,” by the Mayor’s Committee on City Planning with funds from the Works Progress Administration (WPA).

The FAR was able to make headway during the Depression because President Roosevelt’s administration was funding research that allowed planners the chance to study and promote what they had been thinking about for some time. As this report indicates,

This investigation logically carried the work [of the joint committee] one step further, resulting in drafting the skeleton framework for a new zoning resolution. This framework carried out the general thinking of the committee, and introduced some modifications and refinements of detail…..It is now generally accepted opinion that the time has come for New York City to overhaul its zoning structure and bring it up to date.

The report was written by Theodore T. McCrosky (1902-1968), who was one of the pivotal spreaders of FAR. It might not be too much of a stretch to say that he was the Johnny Appleseed of modern zoning. Given his key role, why has he all been forgotten in planning history? (He does not even have a Wikipedia page, for example, though the New York Times did publish his obituary). We’ll come back to this below.

Theodore McCrosky

McCrosky was born in Tecumseh, Nebraska, and graduated with a civil engineering degree from Yale University in 1923. After graduate work at Louvain University, he taught at Yale and worked in traffic engineering and city planning. In 1928, he was hired by the Regional Plan of New York and its Environs as an assistant to the general director of plans and surveys, Thomas Adams—one of the world’s foremost Garden City planners. As described in an earlier post, Adams and Robert Whitten promoted FAR-like planning in their writings, especially in the widely influential Regional Plan. Adams and Whitten were the godfathers of the FAR (godFARthers?).

In 1929, McCrosky traveled to Nanjing to advise Kuomintang officials on a master plan for what was to be the new capital of China. When he returned stateside, he became planning director for the City of Yonkers.

FAR Montage. Examples of housing in New York City with different floor area ratios (FARs). Upper left: FAR 5.0, lower left: FAR 0.5, middle: FAR 16.9, upper right: FAR 3.3, lower right: FAR 1.0.

Zoning for the City of New York

By 1938, McCrosky was back in New York, where he was hired by the Mayor’s Committee on City Planning to write the report. It would set the blueprint for modern zoning, not only by introducing the FAR for comprehensive building bulk limits but also by introducing the kinds of zoning maps that we have today.

In 1916, the enacted zoning codes were specified in three separate maps—one for height setbacks, another for open space requirements, and a third for use (residential, commercial, or unrestricted). McCrosky’s report combined them into the now-standard method of placing all three within each zone (in addition to FAR requirements, sunlight provisions, and all sorts of other regulations).

For example, the R1 district was for “single-family detached dwellings and its accessory buildings.” The maximum FAR was to be set at 0.65. The R2 district was for similar uses as R1 but with a maximum allowable FAR at 0.8. All told, the report offered nine residential zones, three business districts, and an industrial zone. In hindsight, it was quite conservative. Today, in New York, there are ten main residential districts, eight commercial districts, and three for manufacturing. And each category has one or more subcategories. By my count, there are about 170 different zoning areas.

The Civil Servant

Following his stint with the Mayor’s Committee, McCrosky became the first director of the Master Planning division in the newly formed City Planning Commission (see below). By 1938, McCrosky was a rising star. In 1940, the New York Times reported that

Theodore T. McCrosky of 32 Washington Square West was rated first in competitive examinations for the posts of city planning director at $6,000 and associate city planner at $5,000, according to an announcement yesterday by the Municipal Civil Service Commission….Following Mr. McCrosky, whose rating was 92.90 per cent, the list for associate city planner carries F. Dodd McHugh as second, with 85.93….Mr. McHugh also placed second in the test for city planning director.

However, just as he was basking in his magna cum lauds, McCrosky packed up his bags and headed to the Windy City to take over as the executive director of the Chicago Plan Commission. We will return to McCrosky (and McHugh) later.

Rexford Tugwell and the City Planning Commission

In 1933, Congressman Fiorello La Guardia (1882-1947) was elected as the 99th mayor of the City of New York. He ran on a fusion ticket of Republicans and good government parties after the fall of mayor Jimmy Walker (1881-1946). Walker, a member of the notorious Democratic Club, Tammy Hall, was popular while Gotham was booming in the Roaring Twenties, but then a corruption scandal forced him from office. La Guardia was determined to reform New York’s government to root out corruption and provide an expansive set of services and programs to relieve suffering from the Great Depression.

In this vein, La Guardia spearheaded the creation of a new city charter that would centralize decision-making in his office. Historically, power was decentralized through the city’s Board of Estimate, comprised of the five borough presidents, the mayor, the comptroller, and the Board of Alderman president.

Birth of the CPC

The new charter, adopted in November 1936, left the basic governmental organization intact but provided changes to reduce corruption, create new offices and divisions, and establish a civil service. The charter contained a provision for establishing a City Planning Commission (CPC), which had responsibility for zoning, producing a master plan, and preparing capital expenditures and budgets. To give teeth to the CPC, the charter indicated that CPC decisions were considered final unless a three-fourths majority of the Board of Estimate overturned them.

The Department of City Planning (DCP) was also formed to provide research and do the heavy lifting of the Commission. It was headed by the chairman of the City Planning Commission and staffed with engineers, architects, and experts. Both the Commission and the Department began functioning in 1938.

The Master Planner

La Guardia eventually picked the controversial figure of Rexford G. Tugwell (1891-1979) as the first chairman of the CPC. Tugwell studied at the University of Pennsylvania, where he received his Ph.D. in economics. He taught at Columbia University from 1920 to 1932, and wrote widely on the need for economic planning. As historian Mark Gelfand writes,

No political figure of the 1930s was more closely identified with planning than Rexford Tugwell. Although allegations by his conservative opponents that Tugwell was a communist were unfair, defenders of the traditional American way of life were correct in concluding that the former Columbia University professor was not one of their own. Tugwell shared little of the American public’s faith in the market place as the impartial maker of decisions, either economic or political. The market place had been outmoded by the new machine age; society could no longer be run efficiently or justly on the principles of individualism and competition. Both businessmen and politicians, he insisted, thrived on uncertainty, whereas liberty, equality, and security in the modern world depended on exactitude and control. “Planning,” Tugwell told the American Economic Association early in the decade, “is a process of predicting and making it come true.”

In 1932, Tugwell was selected by President Franklin D. Roosevelt for his New Deal “Brain Trust.” After a stint in the Department of Agriculture in 1935, he was given a chance to create and direct the Resettlement Administration (RA) to aid struggling farmers.

The Resettlement Administration

One important component of the RA was its suburban resettlement program, which sought to relocate poor farmers to newly built “greenbelt towns” outside city centers, where they could find employment in other sectors. Initially, Tugwell hoped to build 25 greenbelt communities, but only three were completed (Greenbelt, MD; Greenhills, OH; and Greendale, WI).

To aid with his plans, Tugwell turned to New York architect and RPAA member Clarence Stein. During the 1920s, Stein worked with Kohn and Ackerman to develop America’s first Garden Cities, Sunnyside, Queens, and Radburn, New Jersey. By the time Tugwell arrived in New York, he was steeped in the RPAA’s ideas to de-densify cities.

FAR Example. This drawing shows three ways to build a structure, all with an FAR of 2. Source: NYC DCP.

Tugwell’s New York

Tugwell’s role in New York planning history merits a longer discussion. And I will have more to say in a future post about his stint in the Big Apple, but suffice it say, it was short and marked by defeat. Tugwell arrived in New York in 1938 and left for Puerto Rico in 1941, where he became the island’s governor. He was basically chased out of town, with his tail between his legs, by New York master builder and power broker Robert Moses, who held a dim view of Tugwell’s masterplan. (I will also return to Moses’ role in New York’s planning and zoning history in a future post.)

Tugwell tried to tackle zoning reform in 1939. His signature policy was to ban large billboards and flashing signs from retail districts. The proposal also stated that current signs in violation would not be grandfathered and had to be removed. The business community, landlords, and advertisers didn’t like this plan and were vocal in their protest. They were joined by those who saw this small non-conforming use rule as a slippery slope to greater regulation. Ultimately their objection led to the proposal’s defeat.

Nonetheless, amended zoning codes passed in June 1940. It had tweaks to the extant 1916 regulations and included FAR caps in newly created suburban zones. These additions were meant as a toehold into more extensive reforms, but the real work was to follow the implementation of a master plan. In the statement to the 1940 Zoning Proposal, the CPC claimed,

After careful consideration, it appears that more fundamental revision may be indicated upon completion of the basic Master Plan studies upon which the Commission and the Department of City Planning are now engaged. As the same time there would appear to be no good reason for denying to the residents of this City the advantages to be gained through such zoning provisions as are enjoyed elsewhere, are desirable in the City, and not inconsistent with the structure of the present Resolution….

Finally, there is introduced an entirely new principle of bulk limitation, designed to keep the bulk of buildings in these districts within reasonable limits, at the same time affording a maximum of leeway for individuality of design and arrangement. This bulk limitation is expressed in terms of the permissible area of floor space in the building in proportion to the area of the plot. For example, the 1.6 ratio permitted in F area districts is such as to permit the usual six-story apartment building, but if the height were increased, it would be necessary to decrease the coverage proportionally….The regulation is framed in terms of floor area, rather than cubic contents of building, because the latter would put a premium on low ceilings.

The Master Plan

Released in the fall of 1940, the proposed master plan had the ambition of flipping one-third of New York City into green space by 1990. As Gelfand writes, this was too much for Robert Moses whose

disdain for “do-gooders” also extended to their espousal of planning. Years of bargaining and compromising with governors, mayors, legislators, bankers, lawyers, property owners, engineers, and countless other groups had taught Moses that society was composed of too many disparate interests for any comprehensive, long-range master plan to be conceived and executed. A free society could plan, but only for limited objectives within a short time frame. Any “long-haired, ivory-tower” approach to planning was either not feasible or based on undemocratic premises. A master of the broker type of political universe he had inherited and helped form, Moses had sworn holy war on those “fanatic[al] and irresponsible” exponents of economic and political experimentation “who were quite ready to blow up the entire laboratory in order to insure a fair test of their latest invention.”

February 13, 1942, the City Planning Commission formally voted to scrap the master plan.

 Tugwell and Ludlow in Puerto Rico

After New York, Tugwell had a chance, as governor of Puerto Rico, to implement his ideas with a much freer hand. In 1942, he set up the Junta de Planificación, Urbanización y Zonificación de Puerto Rico—the Planning, Urbanization and Zoning Board—which hired William H. Ludlow as consultant.

William Ludlow

Ludlow is one of those hidden people in planning history. All we have left today is the footprints of his writings. I can find no obituary at his death; he has no Wikipedia page; and apparently has no biographies. Rather, he seems to have been a studious and serious soldier for the planning and zoning cause and did little to attract attention to himself. But from the digital gossamer, we can trace out bits of his actions.

In 1954, the Hartford Courant printed an obituary of Ludlow’s father, William Orr Ludlow, a well-known New York City architect. It mentions that Ludlow was survived by his family, including his planner son, William H. The Rockland County Journal-News in 1935 announced a wedding between Miss Wilma Chitterling of West Orange, New Jersey, and William H. Ludlow of Madison, New Jersey, also a Princeton University alumni. As for the newlyweds, “Following a brief motor trip in New York State, Mr. and Mrs. Ludlow will reside in Washington, where Mr. Ludlow is engaged in planning and research for the Resettlement Administration,” headed by Tugwell. At the RA, he contributed to several reports, and also worked with Clarence Stein.

Ludlow in New York

After about seven years in DC, Ludlow moved back to New York. He was hired to write a report for the Citizen’s Housing Council (CHC) of New York. The organization promoted affordable and safe housing (and claimed Frederick Ackerman among its membership). Ludlow’s 1944 CHC report, “Population Densities for New York City: A Technical Study of Urban Population Densities in Relation to City Planning,” set about defining and measuring population and building density throughout New York. The floor area ratio plays a key role.

Ludlow’s introduction begins with the “Ackerman Fact” that the city could hold 77 million residents if fully built out. He then discusses the need for “adequate density controls,” followed by a discussion of the pros and cons of the floor area ratio. Pro: “Relatively easily computed for single buildings, projects or small areas….Allows for flexibility of design. Can be applied to non-residential space.”  Cons: “Does not allow for differences in room and apartment sizes. If used for regulation, it may tend to result in minimum room sizes in new projects.” The report concludes that northern Manhattan and parts of the Bronx and Brooklyn should have residential FARs capped at 2.1, and the rest of the outer boroughs capped at 1.2.

The following year, Ludlow published two papers in the Journal of the American Institute of Planners, specifically mentioning his work on the FAR for density control. Here, we can see that the ideas first developed in New York in the 1930s were increasingly part of the planners’ toolkit. And as such, they begin to appear in academic journals read by the planning profession.

Ludlow in Puerto Rico

After Tugwell established the Junta, Ludlow was hired as a planning consultant to work on developing zoning codes. They were implemented in San Juan in 1946 and contained FAR provisions. San Juan was thus the first city within U.S. territory to implement the FAR outside of New York.

The Spread of the FAR Stateside

Besides Ludlow, other planners from New York spread the FAR “good news” to the rest of mainland U.S., primarily through their reports and journal publications. For example, a year after Ludlow’s article about New York, F. Dodd McHugh published his research on Gotham in the Journal of the American Institute of Planners, where, for example, he measures the relationship between population densities and floor area ratios.

Francis Dodd McHugh (1907-1978) studied architecture and planning at Cornell and Harvard Universities. As mentioned above, he worked for the Department of City Planning, New York City, and was City Planning Director from 1941 to 1946. After his public service, McHugh joined with McCrosky as planning consultants that were hired by many municipalities around to offer new zoning plans.

The 1950s

By the end of the 1940s, the FAR was common knowledge. A 1948 report by the American Public Health Association entitled “Planning the Neighborhood,” confirms that this to be true:

The measurement of building bulk in term of ‘floor area ratios’ has been found so useful as a density control that it being applied increasingly by planners both in the United States and Britain.

And by the 1950s, the FAR began its exponential spread into the zoning codes across America. Initial discussions showed up in Chicago in 1951, in San Francisco in 1952, and in Boston in 1953. By 1958, the FAR was so widely used across the country that no one seemed to remember its origins. In 1958, the American Society of Planning Officials admitted, “Just when the floor area ratio bulk control first appeared in a zoning ordinance is not certain.” (Answer:  New York, 1940.)

Chicago 1957

Chicago’s example is interesting because, as America’s second city, it beat New York to the punch, though that fact seems to be lost in our understanding of the FAR’s history. Exactly how it got to Chicago is not wholly known. The evidence suggests that even though McCrosky was director of the Chicago Plan Commission in 1941-42, following his seminal 1938 report, he did not spread the FAR there.

Rather, by the 1950s, it was in the ether winds blowing across the heartland. It appears in a report for the Chicago Plan Commission in 1951. Like the New York reports that preceded it, contained a detailed study of residential densities across the Windy City. The report cites its definition of the FAR from the 1948 “Planning the Neighborhood” study.

Under the leadership of local freight shipping magnate turned planner Henry F. Chaddick, Chicago began the process of creating a new zoning resolution. In October 1955, the city embraced the FAR, and the new zoning resolution was implemented in 1957. From there, FAR caps spread throughout Illinois.

McCroksy as Johnny Appleseed?

Returning to McCrosky, after World War II, he became the executive director of the Greater Boston Development Committee. But then, starting in 1948, in his private consulting practice with F. Dodd McHugh, he spread the FAR across America.

In 1952, McCrosky and McHugh were hired by the Philadelphia City Planning Commission to provide blueprints for rezoning the city, which included FAR cap provisions. Like New York, Philly appears to have dithered for a decade until 1962, when the FAR was formally implemented. By the end of the 1950s, McCrosky could boast of his influence.  In a court deposition, he revealed:

Well, among others, we prepared zoning ordinances for Yonkers, New York for Ossining village, for North Pelham, all of Westchester County; for Derby in Connecticut, for West Orange and Somerville and Manville, Jefferson Township and a good many other municipalities in New Jersey.

The Cast: Some of the Key Players in New York Zoning History. Clockwise from top left: Thomas Adams, Theodore McCrosky, Fiorello La Guardia, Rexford Tugwell, Robert Moses, and Jame Felt.

Why Did New York City Dither?

If New York invented the FAR, why did it take two decades to adopt it citywide? The short answer is strong opposition and divided leadership. The two-decade delay was not for lack of trying, but a new proposal was defeated each time. Eventually, a comprehensive rezoning was shepherded into law in 1960 by the widely-respected Planning Commissioner, James Felt (1903-1971).

Born in the Lowest East Side, Felt was a third-generation real estate man. After studying at the University of Pennsylvania, he returned to New York and established a firm, dealing in management, land assembly, and relocation of evicted tenants. His company, for example, amassed the land for Peter Cooper Village and Stuyvesant Town, two huge residential projects in Manhattan built by the Metropolitan Life Insurance Company after World War II.

His New York Times obituary quoted Donald Elliot, the then chairman of the CPC, saying that Mr. Felt was “the father of modern zoning, as a result of his achievement in effecting the 1961 zoning resolution, the first change in the city’s zoning laws since 1907.”

Evidently, the Times was willing to take him at his word. But the two facts are not true. The city’s first zoning laws were enacted in 1916, not 1907, and, as discussed above, he was not the father of modern zoning (though the Times article helped perpetuate that myth). When Felt took over the reins of the CPC, the FAR and modern zoning were already decades old. His contribution was to effectuate what the city had struggled to accomplish for many years.

Zoning After Tugwell

After Tugwell left Gotham in 1940, Robert Moses was appointed a commissioner to the CPC.  Moses proposed a citywide rezoning in 1944. His plan was based on reforming the 1916 zoning codes rather than the systematic use of the FAR. The key element was to reduce bulk by making setback and open area rules stricter.

Interestingly, Irving V. A. Huie, a fellow member of the Commission, offered a FAR-based proposal, but Moses and the other commissioners rejected it. Despite opposition from the real estate community, the Board of Estimate passed Moses’ plan. However, the courts declared it illegal on a technicality related to the Board of Estimate’s voting procedure. The law, as handed down by Moses, was rejected.

The Harrison, Ballard & Allen Report

Then in 1948, the CPC Chairman Robert F. Wagner Jr, hired Harrison, Ballard and Allen (HB&A) as consultants to create a blueprint for a new zoning resolution. This report is interesting in a few respects. First, it is still circulated widely among New York planners (and is posted on the DCP website), and this gives the (false) impression that it was the first time in New York history that the FAR was part of any government-sanctioned report.

Secondly, one of the report’s authors William Ballard, who became CPC chairman from 1963 to 1966, was a protégée and co-author of Frederick Ackerman, who was intimately involved with the early conception of the FAR (which was used in guiding NYCHA housing projects at least as early as 1940). As discussed in another post, Ackerman was an avowed technocrat and believed that the perfect society could be designed by the technically oriented master planner. Ballard, as such, was there as the creation.

But the HB&A report, which uses the FAR as the central density-controlling feature, makes no mention of the FAR’s 15-year history. Why this might be, at this point, is subject to guesswork. One theory is that when the report was released, the FAR was so universal that no need was felt to mention its origins. Planners across the country already took it for granted. A second theory is that the authors wanted it to seem like it was their contribution rather than those who came before them. Regardless, today, the conventional wisdom is to give credit to the HB&A report for introducing the idea, and the focus on it has helped to erase knowledge of the roles played by the founders, including Kohn, Ackerman, Tugwell, McCrosky, McHugh, and Ludlow.

Ironically, despite the perceptions as it being pivotal, the HB&A report ultimately failed to be enacted. The plan, released in April 1951, had both supporters and detractors. One key opponent was…wait for it…Robert Moses. Between the opposition from within and without, the plan eventually died. Or as Stanislaw J. Makielski put it in his 1966 Ph.D. dissertation on the politics of zoning reform, “The Commission had been defeated by a strongly organized resistance and its own unwillingness to do battle for the HB&A plan.”

The Vorhees, Walker, Smith & Smith Report

Finally, when James Felt took the helm at the CPC, he hired yet another consulting firm in 1956 to offer a new zoning plan. Released in 1959, it was in a similar spirit to the HB&A report in that it relied on the FAR to reduce the city’s density. After public feedback, Felt and the CPC were able to revise the proposal and rebut the naysayers to get sufficient buy-in. Moses, again, was opposed to it, but he eventually switched to a “yes” vote after pressure from Felt.

In December 1960, New York City formally adopted the floor area ratio as the main tool to limit building bulk, and the law was to go into effect in December 1961. It represented a major downzoning, with a maximum population of 12 million, compared to Felt’s estimate of 55 million under the 1916 codes as they were written in 1956.

Triumph of the FAR

While the FAR’s originators, including Robert Kohn and Frederick Ackerman, were off the scene by 1960, they were the true fathers modern zoning. They were carried by the spirit of the age, which saw cities as messy, unhealthy, and exploitative. They came to believe in a technocratic ethic: that they could develop formulas to fine-tune the city like a sophisticated clock. Once they understood the key mathematical rules, they could adjust the city to their preferences and create order by design. These formulas, including the floor area ratio, were not value free.

Planners could not as easily control people or household sizes, but they could control building sizes and densities. As a result, they created vast swaths of urban land with very low maximum floor area ratios. These FAR caps were meant to check the “greediness” of developers who might have otherwise catered to the demand for apartment living. The FAR founders felt that the city should look more like the ideal Garden City as laid out by Ebenezer Howard and his “apostles.”

By the 1960s, with the publication of Jane Jacob’s book, The Death and Life of Great American Cities, and the failures of public housing, slum clearance, and urban renewal, the belief in better living through technocracy and planning began to get pushback. Nonetheless, cities across the country could not shake their reliance on the FAR. Once implemented, it became an “absorbing state” because it was the one planning policy left from the technocratic heyday that allowed planners some modicum of control (and had great support from Nimbyists seeking to stop changes in their neighborhoods). For good or for bad, the FAR remains triumphant.

In next post, we take up how the FAR left America and spread to the rest of the world.

Continue reading Part I of this blog series on the birth of modern zoning during the 1920s here and Part II on the Great Depression here.

by Jason Barr 7 Comments

Housing Gotham (Part I): The 21st Century So Far

Jason M. Barr (@JasonBarrRU) and Sean Franklin       September 27, 2021

The 1970s was New York’s darkest decade. The government nearly went bankrupt. A recession that began in 1969 triggered the loss of hundreds of thousands of manufacturing jobs. Between 1970 and 1980, Gotham’s population shrank by more than 800,000 people, while arsonists burned down entire neighborhoods.

In those years, only a true visionary could have foreseen the city’s rebound. Yet starting in the early 1990s, New York began a dramatic resurgence. New service-based industries grew in place of the old factory jobs. Crime rates fell, and the decay and despair that had marked the previous years were replaced with reinvestment and optimism.

Economic growth and a sense of security drew people back so that by 2000 the population had recovered to its earlier peak. To this day, the population continues to increase to new highs. But the laws of supply and demand, being what they are, suggest that, while the city can hold more people, it cannot build fast enough to keep up with demand. The result has been more homelessness, increasing affordability problems, and greater income inequality.

Despite these issues, the questions remain: How has New York’s housing stock changed over the 21st century? Has it grown or shrank? If so, where and why? Which neighborhoods are punching at their weight, and which ones are not doing their part in the great housing game? To this end, we looked at changes across the Big Apple over the roughly two-decade period from 2002 to 2020 (pre-pandemic) to better understand how and where New York is housing its people.

The answers might surprise you.

Counting Houses

One of the benefits of being interested in New York City’s housing market is that city agencies have been on the vanguard of providing large data sets to the public. One is particularly relevant—the Primary Land Use Tax Output (PLUTO) file—which is online going back to 2002. The PLUTO file includes information about every tax lot in New York City and tells, among other things for each one, the building type, how many housing units it contains, the building height, and so on. The file allows for a very detailed look at the changes in Gotham’s housing supply.

Housing unit additions can appear in three ways: First is through new construction. The second is from the splitting up of extant units within a building. For example, a one-family house can be subdivided into a two-family house. Lastly is through building conversions, where, for example an old office or loft building is refitted for residential use. The critical point is that we cannot solely rely on new construction measures if we truly want to understand the changes in housing supply. A flexible housing market will depend on all three.

For that matter, there are forces that can shrink supply: Buildings can be demolished, residential units in the same building can be combined, or buildings can be converted to other uses. Thus, the net housing changes across the city depend on both the “adding” and the “subtracting” forces.

Two Decades In

In 2002, the city had about 3.2 million housing units. By 2020, that number was just over 3.6 million units, a growth rate of about 13.5%. In the same period, New York’s total population grew by about 10%. On the surface, this seems promising; the housing stock increased faster than the population.

But the difference of about 3 – 4% is problematic on several fronts. First, a healthy housing market should have a reasonably high vacancy rate, say between 7-10%. The market should have enough available units so that new people coming in and those switching their housing all have enough choices and are not duking it out over just a handful of options. Before the pandemic, the city’s overall rental vacancy rate was 3.3%, and 10.5% of rental housing was overcrowded. Furthermore, the vacancy rate for rent-stabilized units was a minuscule 2.06%, while private, non-regulated units were vacant at a 6.07% rate. Consider that about two out of every three New Yorkers is a renter, and 58% of rental units are regulated or rent-stabilized.

Second, a relatively high number of units—especially in Manhattan—are used as a pied-à-terre or second home, which remain empty for a significant fraction of the year and are not available for residents. One estimate puts that figure at 10,415 units for Manhattan. While that is only 1% of all Manhattan units, it’s another source “removed” from the local market. This issue is likely made worse by Airbnb, where visitors can soak up “slack” housing.

Household Size

Additionally, the “desired” household size has been shrinking over time. As incomes rise, people are less willing to shack up with roommates, and they want more space. Also, the composition of households is changing. The proportion of traditional nuclear families with two spouses with children has dramatically fallen. In contrast, households of couples with no children and single-person households have grown in their place. All these various demand-side changes put pressure on New York’s housing stock.

Given the overall difficulty in building, new construction appears mainly at the higher end of the market. So, the average net difference between the population and the housing stock growth might not reflect housing access across all groups. As a hypothetical example, it may be that the net growth in housing units relative to the population for the upper-income households is 10%. At the same time, for the lower-income folks, it is 1%, leaving an average difference of 4%. And while recent research shows that even high-end high-rise apartment building construction helps reduce prices, its impact on lower-income residents is less direct.

A way to understand the relative growth in the 21st century is to look at another time in New York history when the population grew rapidly while maintaining relatively affordable housing prices. Census data from 1910 and 1930 reveal that New York City’s population grew by 45% in the two-decade period, while the number of households (our measure of housing units) grew by 78%. Prorating that to the 10% population growth seen in the 21st century would suggest housing stock growth would need to have been at least 17% to keep prices in check (assuming, as well, that housing is broadly created for those across the income spectrum).

In short, when we consider all the forces as work, a net gain of housing units of about 3-4% higher than the population growth shows that housing supply is not matching demand across the entire income spectrum.

A Tour Across the City

What has happened to New York’s housing stock across different neighborhoods since the beginning of the 21st century? Using our data set and focusing on the city block level, we created three categories. Category I is “Lost Units.” A block in this group had six or fewer units in 2002 as compared to 2020. Category II is “No change.” Being in this group means that the block was within plus or minus five units over the two-decade period. Lastly, category III is “Gained Units,” which means a block added more than five units. The five-units cut-off is admittedly arbitrary but seems reasonable to understand better changes in units over time: loss, about the same, or growth.

Static New York. A map of New York City blocks that lost units (dark blue) or stayed about the same (light blue). Here “same” means unit counts changed between +/- 5 units since 2002. Source: NYC PLUTO files.

We then created a map of New York City, which shows, for every block, if that block either stayed the same or lost units (the “Gained Units” map is here). In a growing and flexible city, we would expect to see many neighborhoods “share the burden” to accommodate that growth. But in fact, we see something very different. The vast majority of New York City over the 21st century either lost units or remained about the same. Of the approximately 29,000 city blocks, 75% saw either no change or a loss of units, with 4% of those losing six or more units (14% of blocks lost one or more units–see map below). Only 25% of blocks saw an increase in six or more units. In short, the block-level analysis shows that much of the city is quite static, unwilling or unable to pony up more housing.

Loss Clusters

If we zoom into the clusters that lost housing, we can see that they are mainly in Manhattan and Brooklyn. One set of loss clusters—the Upper West Side, the Upper East Side, and Greenwich Village in Manhattan and Brooklyn Heights and Park Slope in Brooklyn—have many landmarked historical districts. It appears that landmarking residential neighborhoods is a great way to shrink the housing stock.

Likely, because of their charm and the limits to new construction, wealthier people move in and then combine units. Brownstone buildings with, say, eight apartments could be bought and converted to a single-family dwelling, or someone could buy two adjacent apartments and combine them into one. The takeaway is that while landmarking may be a way to preserve the city’s built heritage, it comes with a price: Less housing for everyone else.

The third “loss cluster” is southern Brooklyn, particularly in the Gravesend and Sheepshead Bay areas. Stephen Smith, a New York housing expert and blogger at Market Urbanism, has written on this phenomenon in the Observer. The neighborhood has emerged as an ethnic enclave for Syrian Jews, who are tearing down older two-family homes and replacing them with single-family ones or are combining lots to build one house in place of two.

The Losers of New York. Left: Maps of Manhattan Blocks that Lost More Than Two Units between 2002 and 2020. Right: Same for Brooklyn Note: Boroughs not to scale. Source: NYC PLUTO files.

What Drove Changes in the Housing Stock? A Block Level Analysis

More broadly, besides landmarking, what can help account for changes in the number of housing units, at the block level, across the city, on average? To do this, we performed a statistical (regression analysis) that looks at the factors likely to be driving changes (or not) on each block.  The analysis looks at characteristics of blocks and neighborhoods in 2002 to see which are predictors of the relative changes in housing units over the two-decade period. (The data and the statistical results can be found here.)

The analysis shows that historical landmarked residential neighborhoods are “bad” for housing stock growth, as the maps suggest. For example, a block with ten landmarked properties in 2002 lost 2-3% of its housing units two decades later, on average. Interestingly, however, landmarked commercial districts had the opposite effect. Those areas that were formerly retail, lofts, or businesses, and were landmarked, saw their housing stocks grow because the insides were converted to apartments. However, the number and size of residential landmarked districts are much greater than the number of commercial landmarked districts, so the net effect of landmarking was to decrease the housing stock.

A Heavy Lifting Index

The statistical analysis lets us create a “heaving lifting index” that shows the community districts that saw significant construction. The map below shows the community districts in the top quartile for proportionally adding units, all else equal. They tend to be in the densest parts of the city (and in gentrifying neighborhoods, see below).

But within these neighborhoods, most of the increases in the housing stock came from “low hanging fruit” lots, what one might call the non-NIMBYable blocks. That is, most of the blocks that saw housing unit growth had formerly been those with many commercial/non-residential structures or were parking or vacant lots. In other words, residential districts in 2002 were more likely to lose units over the two-decade period than their more commercial counterparts. The results strongly suggest that once a block is converted to residential use, its prospects for adding more housing are bleak.

Finally, the results also show that those neighborhoods with more generous zoning provisions added more housing. Here we look at the average allowable floor area ratio on each block in 2002, where the FAR measures the total allowable building area per square foot of land. We find that, on average, a block with a 10% more generous FAR led to 1.2% more housing, all else equal. Not a huge number, but it suggests that restrictive zoning is bad for the housing supply. (We leave for future analysis the causes and consequences of rezonings on New York’s housing supply.)

“Heavy Lifting Districts.” The blue community districts were in the top quartile for adding units between 2002 and 2020, holding building and neighborhood factors constant. Source: See here.

The Gentrification Effect

One of the most contentious issues for urban America in the 21st century is gentrification. The renewed desire for young professionals to live in the city has meant that some lower-income neighborhoods have seen an influx of high-educated, high-skilled workers. The demographic shifts in these neighborhoods have generated resentment from the old-timers, who see the newcomers as driving price increases, displacement, and changes in the character and feel of their communities.

We wanted to understand how gentrification might be driving changes in New York’s housing stock. To make matters more concrete, we define a census tract as “gentrifying” based on two conditions. First, in 2000, it had an average income in the bottom half of all census tracts in the city. Second, in the two-decade period, it was in the top half of growth in the share of college-educated residents. In short, the idea was to look at those relatively low-income neighborhoods in 2000 that saw a large influx of higher-education residents during the period (the gentrifying neighborhoods map can be found here).

The census tract analysis shows that, typically, gentrifying neighborhoods were associated with a rise in the total number of units. On average, if a census tract was classified as gentrifying, it saw an increase of about 4-6% in the number of units, all else equal.

Recent research has not found strong evidence of gentrification driving displacement. Since gentrifying neighborhoods tend to be more dynamic, the evidence suggests that higher educated folks replace the residents leaving for reasons independent of displacement. Other research has found the rise of “Yuppy fish tanks”—pockets of new construction within the historic neighborhoods. Our findings are consistent with these.

The View from 1250 Feet

Overall, what does our analysis suggest? First, the total growth in the housing stock appears not to have kept up with the demand and increase in the population. While net housing units grew about 3-4% more than the population, this has not been enough to meet New York’s housing needs.

The second is that many neighborhoods lost units over the two-decade period. Much of this loss was in historic districts. In Brooklyn, several loss pockets came from teardowns of two-family homes replaced by one-family homes. While some housing loss across the city is natural in an evolving and dynamic metropolis, the loss we see does not appear to come from switches to other vital purposes, such as for hospitals, schools, or business. Instead, the disappearance is directly tied to upper-income households removing units from the market.

Across the city, only about one-quarter of New York’s blocks added more than five units in the two-decade period. The rest remained about the same or lost units. Those neighborhoods that added their fair share did so by primarily converting non-residential lots to residential use. And much of the new construction occurred in gentrifying neighborhoods in a ring around the heart of Manhattan.

In the next post, we will turn to the relationship between supply and prices to see how they are linked (or not) in the Big Apple’s housing market.

More posts on NYC housing can be found here.

Thanks to Jenny Schuetz for helpful comments on the post. 

by Jason Barr 5 Comments

The Birth and Growth of Modern Zoning (Part II): The FARsighted Great Depression

Jason M. Barr (@JasonBarrRU)    August 9, 2021

Preface

Today, many cities worldwide regulate urban density by limiting the floor area ratio (FAR)—the amount of allowable building space relative to the lot size. Cities use FAR caps to reduce building bulk, preserve leafy residential neighborhoods, and maintain the historical feel of central cities. The FAR is one of the most important tools in urban planning. This is blog post #2 in a series about the birth and growth of the FAR. (Post #1 can be read here.)

The View from Roaring Twenties

Americans enjoyed themselves during the Roaring Twenties, dancing to jazz, while sipping speakeasy gin, and watching Babe Ruth hit home run after home run. But beneath the heady foam of fun was a stew of urban problems.

These problems—hyper congestion, pollution, extreme poverty, and slum-like living conditions—gave rise to fierce debates about the correct suite of solutions. In 1916, New York City ushered in the nation’s first comprehensive zoning regulations to rationalize land use and reduce urban density, by setting rules on building height, use, and lot coverage for every single property in the city. New York’s zoning program was replicated throughout the country.

However, the regulations were relatively conservative because the zoning Founding Fathers did not know what would legally “stick.” Laissez-faire America felt strongly about the sanctity of private property, and without any precedent to go on, government intervention could not smack of interfering with that right unless it was absolutely necessary and fell within the government’s rights of “police power.”

After about a decade of seeing the rules in practice, urban reformers found the original zoning codes wanting. The city was still too dense, residential neighborhoods remained unprotected from pollution and overcrowding, and supertall Art Deco skyscrapers rose like giant mushrooms.  Reformers demanded tighter regulations to de-densify neighborhoods and better separate land uses.

De-bulking

By the end of the Twenties, there was a firm conviction that one of the best ways forward was by limiting building bulk—that is, by limiting the floor area ratio, though the specific formula had not yet been invented. Two well-known and respected planners, Thomas Adams and Robert Whitten, introduced the concept to the world at the end of the 1920s, most notably in the Regional Plan of New York and its Environs. The multivolume survey and plan sponsored by the Russel Sage Foundation offered a roadmap to rationalize the region’s transportation, infrastructure, and land uses.

At the time of the Plan, the FAR was merely a concept—that as buildings became taller, they should be required to be skinnier to preserve open spaces and light around buildings, while limiting the overall building density. But as the Great Depression swept across America, it would open a window of opportunity for reformers to have more say over urban policy.

As a result, architect Robert D. Kohn (1870-1953), along with his colleague, Frederick L. Ackerman (1878–1950)—who were deeply involved in New Deal housing policy—would be the first to launch the FAR into the policy sphere. This would take place in 1935, long before its appearance in the 1961 New York City Zoning Resolutions, which imposed them citywide. In fact, because of Kohn, the FAR would become embedded in a 1940 revision of the 1916 codes.

Strands of Thought

In the early decades of the 20th century, two groups jockeyed for position in the planning community: call them the visionaries and the practicalists. Both groups shared a common goal of transforming the city and its hinterland into a well-functioning and well-ordered machine, but the visionaries had their visions, and they did not want reality to get in the way.[1] The realists agreed with the visions but felt that one could not create utopia by simply waving a hand or imposing it from above.

During the Twenties, two organizations were instrumental in pushing forward the debate about where big cities, like New York, should go. One was the Regional Planning Association of America (RPAA), and the other was the Regional Plan of New York and Its Environs, which later became the Regional Plan Association (RPA).

As discussed in an earlier post, the RPAA, formed in 1923 by Charles Whitaker, Robert Kohn, Benton MacKaye, Lewis Mumford, Clarence Stein, Frederick Ackerman, Edith Elmer Wood, and Henry Wright, was a loosely organized but influential association of architects, planners, writers, and real estate developers who argued for the Garden City model of urban and regional planning. They were inspired by the work of Ebenezer Howard, especially his book, The Garden City of To-morrow, first published in 1898.

Garden Cities Everywhere

The Garden City-ites felt that density was a plague that needed to be cured with surgical treatment: Cities needed to be deconcentrated and decentralized—to transform the monolith into an octopus. RPAA members spread the Garden City gospel in America after World War I.

One of the first disciples of Ebenezer Howard was Thomas Adams, the manager of Letchworth, the first Garden City project, 35 miles (56 km) outside London, begun in 1903. Over his long career, he promoted the Garden City way of living, but he was also a practical man when it came to planning large cities like London and New York.

In 1923, he was hired to direct the Regional Plan of New York and its Environs, which laid out a relatively practical vision for New York City in forty years hence. It still saw lower Manhattan as the center of the city but offered rationalized routes for transportation routes and demonstrated a path for the coordination of the city with its suburbs to make sure development and growth happened in an organized and healthful manner. Manhattan was to be cleared of slums so it could be a Hugh Ferris-Corbusian island of towers-in-the-park.

Though the RPAA folks vociferously disagreed with this practical vision, there was one thing that the RPAA and RPA could agree on: Current city rules allowed for too much residential density. The route to the good life was through discouraging apartment buildings, encouraging as much free-standing single-family housing as possible, and isolating residences from business and industry that may harm the peace and harmony of the good life. The city was to be like a child’s playset, and all the pieces had to be pre-arranged to tame the chaos.

The Evolution of Chrystie and Forsythe Streets in the Lower East Side of Manhattan. Upper left: A model of tenement buildings demonstrating the overcrowding circa 1900. Right: A “slum clearance” proposal for the neighborhood in the Regional Plan of New York and Its Environs, Vol. 2 (1931). Bottom Left: The construction of Sara D. Roosevelt Park during the Great Depression, after clearing away the tenements.

The Veblen Effect

Several of the RPAA members and their like-minded colleagues were strongly influenced by socialist ideas discussed and debated in the decades following Karl Marx’s (1818-1883) writings. One influential thinker was Thorsten Veblen (1857-1929), an American economist whose work focused on the harm propagated by capitalists and the broader “leisure class.” Veblen, an enfant terrible of the discipline, spent his academic career debating with mainstream economists and Marxists alike.2

Whereas Adam Smith (1723-1790) argued for the primacy of the free market, and Karl Marx promulgated the inevitable proletarian economic takeover, Veblen rejected both conceptions. During his lifetime, it became increasingly clear that there was not going to be an American Communist Revolution, in part, he argued, because the laboring classes were inspired by, and sought to imitate, the leisured classes, who spent lavishly on florid displays of conspicuous consumption to advertise their wealth.

As industries became larger, more technologically sophisticated, and deeply intertwined, businessmen could no longer understand and run the very system they created. Their desires, helped by the connivance of the labor unions, promoted industrial “sabotage”—the manipulation and slowing down of the “machine process” to increase their personal fortunes. As a result, the industrial system was not run to generate maximum output but rather was operated to benefit the few at the expense of the many.

Veblen proffered the notion that only engineers and industrial scientists had the knowledge, rational thought process, and benevolence to oversee the means of production on behalf of the American people. If the engineers of the world banded together and went on strike, they could have the industrial system handed over to them (easily enough since it was already centralized into various interlocking trusts). They would plan and run the economy through a “Soviet of Technicians.”

Technocracy

The publication of Veblen’s The Engineers and the Price System (1921) gave rise to a short-lived organization called The Technical Alliance. Veblen was its “Chief Engineer” and was joined by the RPAA group of Frederick Ackerman, Robert Kohn, Stuart Chase, Benton MacKaye, and Charles Whitaker. Ackerman also joined Veblen as one of the founding members of the Continental Committee on Technocracy. As planning historian Michael Long, writes,

Veblen intended this committee to be “a soviet of engineers”, part of the vanguard of the revolution that would organize a “general strike” to overthrow capitalism. By 1932 this group of scientists and economists was based at the Department of Industrial Engineering at Columbia University and had conducted research into the organizational structure of several hundred American industries with a research staff provided by the New York City Relief Committee. Veblen felt that this research was the ‘indispensable’ precursor to the revolution and that these groups would form the organizational basis of the new society. Ackerman maintained his affiliation with this group after Veblen’s death, writing a series of empirically based articles on technocracy.

The Depression and the Rebuilding of New York

To implement such a program, however, would require much greater government involvement. During the Roaring Twenties, America was growing rapidly, and the free-market spirit was triumphant.  Then the Depression hit, and the reform dynamic changed dramatically, as the weight of capitalism seemed to collapse upon itself.

It now opened a window to enact more radical proposals. Nonetheless, implementing these policies would create considerable debate among the visionaries and the practicalists. While the Depression allowed the visionaries to get their moments, their ideas would be constructed on compromised terms.

Attempts to fully reorder the city would ultimately lose to more conservative pushback. However, on the pages of New York’s current zoning codes, one can still hear a faint echo of the RPAA and the Technocracy, through the creation of the Floor Area Ratio, if one presses one’s ears closely to the pages.

The New Deal and New York City

In 1932, Franklin D. Roosevelt became president of the United States. To help implement his New Deal, he leaned on several RPAA members. Roosevelt, as New York governor, had developed a relationship with the group as he was sympathetic to many of its members positions.

When it came to New York City, however, he saw its government as a cesspool of vice and corruption. It was run by Tammany Hall hacks, who showed more interest in siphoning revenues from the public treasury than in providing good government. During the Roaring Twenties, when times were good, the citizens bothered little with the Tammany side-hustle.

They enjoyed being led by their mayor, Jimmy Walker (1881-1946), bon-vivant, playboy, one-time songwriter, and all-around cheerleader for Roaring Twenties New York. But as the Depression set in, things started to fall apart. Walker was ousted by a corruption scandal in 1932. In his place, Gotham elected reformist Fiorello H. La Guardia (1882-1947), a congressman from East Harlem.

La Guardia campaigned to clean up the city’s government and rebuild New York. Because of his integrity and earnestness, he won Roosevelt’s trust and was able to secure money and manpower to implement New Deal programs. As a result, the city became a laboratory for erecting the visions of the “good city” that had previously only been discussed.

La Guardia and Public Housing

The New York City Housing Authority (NYCHA) was established in 1934, with the mandate to build, manage, and own public housing for low-income residents. In that year, the federal Public Works Administration (PWA) released $25 million in funds to get things started. It was a triumph, though limited, for the visionaries.

La Guardia turned to Langdon W. Post (1899-1981) as the first chairman of the NYCHA. Post, a Harvard graduate and veteran of World War I, served as a state assemblyman from New York City from 1928 to 1932. He was a close advisor to Governor Roosevelt and a strong housing advocate. Before assuming his position at NYCHA, President Roosevelt named Post the Assistant Federal Relief administrator, where he helped create the Works Progress Administration (WPA).

Robert D. Kohn

The PWA’s influence in New York was aided by Robert D. Kohn. He was born in Manhattan and trained as an architect at Columbia University and the Ecole des Beaux Arts in Paris. Beginning in 1895, he established a successful practice in New York. Over his career, he was an active advocate for improving housing and urban conditions among the urban poor. He was a founding member of the RPAA, a firm believer in Garden City planning, and a part of the Technocracy movement.

During World War I, he was chief of housing production for the Shipping Board. The Board oversaw a tremendous increase in shipbuilding for the war effort, and its housing division created homes for more than 28,000 shipyard workers. This experience helped forge his belief that government could successfully erect low-cost, high-quality housing.

At the start of the New Deal, Interior Secretary Harold Ickes hired Kohn as the first head of the Housing Division of the PWA in 1933. However, Kohn soon ran into the realities of politics. As historian Edward Spann writes, it soon became “evident that FDR’s New Deal was not the RPAA’s new deal. In less than a year after his appointment, Kohn was pressured into resigning as housing administrator, and those sympathetic to the regional planning position were soon forced out.”

Frederick L. Ackerman

With money forthcoming from the PWA, Langdon Post filled out the staff at NYCHA. In 1934, he hired a colleague and friend of Kohn, Frederick L. Ackerman, as the authority’s first Technical Director; he was also the chief architect for the NYCHA’s first major project, the First Houses in the Lower East Side. Together, during the Depression, Kohn and Ackerman would work jointly to “invent” the Floor Area Ratio as a zoning policy tool.

Ackerman was born in Edmeston, New York, and graduated from Cornell University in 1901. After studying architecture in Paris, he returned to New York to practice architecture. He designed a wide variety of buildings, including the first centrally air-conditioned apartment building in New York City and large private residences, hotels, museums, and libraries. He was socially engaged and wrote widely on issues of architecture and city planning. A core member of the RPAA, he was particularly concerned about the poor state of low-income housing and the problem of the slums.

He was greatly influenced by the planning programs established in Britain, where he visited the early Garden Cities promoted by Ebenezer Howard and saw firsthand England’s success in building housing for its soldiers during World War I. At the Shipping Board, Robert Kohn brought in Ackerman to be the Chief of Housing of Design. In this position, he oversaw the construction of Garden Villages for the shipbuilders. Fellow RPPA member, Lewis Mumford, said that they “gave a fresh incentive to the housing movement, and pushed it along paths that the older housing reformers never envisaged.” During the 1920s, he played a key role in designing two of America’s earliest privately funded Garden Cities: Sunnyside Gardens, New York (1924) and Radburn, New Jersey (1928).

Among RPAA members, Ackerman was one of the most radical. He was a devotee of Thorsten Veblen and came to see capitalism as a system of greed and corruption that generated cities with too many problems. He believed in socializing private property and of planning both the city and the economy through the enlightened actions of engineers, architects, planners, and scientists.

Ackerman’s Reports

In his position as Technical Director (a title which fit well with his membership in the Technocracy), Ackerman would write reports and create technical manuals to aid in the development of public housing projects, which would lead to the formulation of the FAR.

The Population Bomb

One of his first reports “Population of New York City as Permitted by the Zoning and Multiple Dwelling Laws,” was issued in December 1934 and co-written with William Ballard. The report was an act of fantastic hypothetical speculation. It asked the question: What would resident and employment density look like if every lot was built out to its maximum bulk according to the current building regulations? Its conclusion was that, in theory, the zoning and building laws could accommodate a resident population of nearly 77 million and hold some 343 million daily workers in offices and factories.

In 1930, the city’s population was about seven million. To think it would somehow grow by a factor of 100 in the near future was absurd.  The report became something of a manifesto for Ackerman, as it allowed him (in his mind) to advertise the absurdities of free-market housing and the failures of the 1916 zoning codes. As discussed below, in this regard, it helped open the door to the creation of the FAR. The figure of 77 million would resurface in the press and among the planning community and became the rallying cry for why Gotham needed to be “de-bulked.”

The “Note”

In 1937, Ackerman and Ballard issued another report entitled, A Note on Site & Unit Planning (with aid from the WPA), which was meant—directly—as a reference manual for public housing architects but was also a form of Technocracy propaganda (and is rather shocking at that, especially for a report published by a New York City government agency, aided by the federal government).

Much of the Note is technical. It shows the future of low-income housing as envisioned by Ackerman. It provides drawings for various options for public housing project designs, along with facts about daylight penetration, population density, and lot coverage. The purpose was to present the benefits of surgical urban planning and how to construct tower-in-park housing on superblocks. The report does not mention the Floor Area Ratio but rather continues a tradition of presenting housing designs that minimize lot coverage on superblocks.

The Screed

The drawings, however, are sandwiched between a screed on the evils of the free market. Ackerman’s rage oozes onto the pages. In the Preface, he writes:

The note is little more than a syllabus covering the outcome of an inquiry into the nature of the Problem which confronts those actually engaged in planning areas for residential use while working within the framework of an Economy which, by law and by judicial decision, denies the constitutionality of collective action upon a broad front which the technician deems as essential in Planning is to be other than wishful thinking.

Ackerman as FARther?

But to what degree can we assign the birth of the FAR to Ackerman from his writings and drawings? Carol Willis, founder and director of the Skyscraper Museum, suggests that Ackerman was the pivotal man in history. The notes from a fascinating exhibit on the history of public housing at the Skyscraper Museum say as much:

Where did the concept of FAR originate? It is astonishing that the answer to this question, so determinative for the city’s built environment for more than half a century, has been so obscure. Although the idea existed in several precedents in the early 1930s, the specific lineage seems to lie in the work of Frederick L. Ackerman (1878-1950), the head of the Technical Division of NYCHA and his young deputy William Ballard (1905-1993). In 1934, the two authored a little known NYCHA study titled “The Population of New York City as Permitted by the Zoning and Multiple Dwelling Laws.” Their report was the first to explore – indeed to obsessively calculate – the total buildable area of both full blocks and of the city as a whole allowed under the 1916 zoning. Translating that volume (“bulk”) into floor area, and estimating the average floor space needed per person for work and for housing, they concluded that the city could accommodate more than 76 million people. That excessive number proved to them the need for reform.

But my research into the history of the FAR gives me pause with assigning the main role to Ackerman. While it is true that the above-referenced Ackerman-Ballard report imagines a fully bulked-up New York, nowhere does it mention the concept of the Floor Area Ratio, and in fact, its first appearance, as will be discussed below, appears in a 1935 memo signed by Robert D. Kohn. Ackerman and Ballard’s 1934 report, however, was useful propaganda.

Importantly, their Note on Site & Unit Planning was published in 1937, two years after the first mention of the FAR in print, and yet the Note does not describe or measure the FARs of the housing project designs it presents. The Note would have been the perfect opportunity to estimate the FAR of each project (and a 1950 report co-written by Ballard contains FAR estimates in the renderings). Rather, Ackerman and Ballard only present population density, floor height, and lot coverage. If Ackerman had invented the FAR, why would he not also have added FAR calculations to this report?

Ackerman and Ballard’s Note helped to expand the notion that planning can more efficiently create Garden City type arrangements. In this way, their work is a more technical-oriented presentation of what Garden City architects and planners had been arguing for since the 1920s. If one compares Ackerman’s plans to those of Andrew Thomas, the first architect to build Garden Apartments—the precursor to the tower-in-the-park—their drawings appear to be a logical expansion of those concepts, especially in light of new government programs to build public housing (see the figure below).

The Skyscraper Museum exhibition notes go on to say:

Sixteen years later, in 1950, working as a consultant to the New York City Planning Commission, Ballard produced the Plan for Rezoning the City of New York. This major study outlined most of the revisions eventually incorporated in the 1961 law, including the citywide application of FAR formulas and an increase in open-space requirements for residential buildings. The drumbeat of the report, prepared by his firm Harrison, Ballard & Allen, argued that the 1916 zoning law allowed far too much built density. As in the earlier NYCHA study, Ballard keyed the buildable floor area to projections of future population and made specific recommendations for FAR limits.

As this quote indicates, William Ballard, the protégé and co-author of Ackerman, was an important player in the FAR story. He was co-author of a 1950 report that argued for the use of FAR limits as the mainstay of a new zoning policy. However, contrary to common wisdom, his report was not the first to introduce zoning maps with maximum FAR coverage.

Rather, the 1950 report reignited the FAR discussion that had been placed aside because of World War II. In this way, Ballard et al. revive what was worked out during the period of 1935 to 1940. Ballard, who went on to be New York City Planning Commission Chairman from 1963 to 1968, gets credit for popularizing the FAR. And because Ballard was a protégé of Ackerman, the natural conclusion is that Ackerman created the FAR and passed it on to Ballard.

But, as I will argue below, the chain of events appears to be thus: Robert Kohn in 1935, with the aid of Ackerman, created the FAR concept, along with proposed FAR zoning maps for New York. This led to a period of experimentation and “prototyping.” In 1940, because of Kohn, the FAR appeared as law for the first time in a revision of the 1916 codes by adding FAR limits in suburban zones.

Then America became embroiled in World War II, and all talk of rezoning New York was put aside. The discussion was brought back in 1948 when the city funded a study by the architecture firm of Harrison, Ballard & Allen, who borrowed and expanded upon the maps that were first created based on Kohn’s initiative. Kohn’s role in zoning history was forgotten after 1940. We now turn to these events in more detail, which begins with the City Club of New York.

Evolution of New York City Apartment Building Form. Upper left: Footprints of tenement buildings in the Lower East Side. Lower Left: Building footprints for Amalgamated Houses, garden apartments designed by Andrew Thomas in 1927 (both images from  The Regional Survey of NY and Its Environs, Vol VI). Right: Suggested public housing designs by Ackerman and Ballard, and published by NYCHA (1937).

The City Club of New York and Birth of the FAR

The City Club—still in existence—was founded in 1892 to “promote social intercourse among persons specially interested in the good government of the City of New York, in securing honesty and efficiency in the administration of city affairs, and in severing municipal from national politics.”

The club’s activities have included sponsoring lectures on urban affairs, as well as creating committees and reports to weigh in on vital issues of the day. In the 1930s, many prominent New Yorkers were part of the club, including several RPAA members, such as Clarence Stein, Henry Wright, Alexander Bing, Frederick Ackerman, and Robert Kohn. Bing and Wright sat on the Board of Trustees in 1935.

The Housing Committee, 1935

The conception of the Floor Area Ratio began in early 1935 when the Board of Trustees formally created a new Committee on Housing to study zoning reform. They requested that Robert D. Kohn accept the chairmanship.3 Kohn informed the Trustees that he would do so on condition that he was given authority to appoint qualified non-members to assist, which was okayed by the trustees. In turn, Kohn recruited ten additional people, at least two of whom were RPAA members: Henry Wright and Frederick Ackerman, who was listed as “Advisory-Associate,” and was, evidently, not a full-fledged member of the committee.

In September of 1935, the Committee on Housing transmitted to the Board of Trustees a memorandum on zoning. The tone and urgency made it feel like it was written by Ackerman, though Kohn was also capable of using strong language to express his anticapitalist sentiment. The memo references Ackerman and Ballard’s 1934 NYCHA study, though it was signed by Kohn. It demonstrates the authors’ contempt for urban density:

The absurd exaggeration implied in our present zoning regulations presents an immediate and pressing danger, for already apartment house building has been resumed on the same old principle of overcrowding the land to a much greater degree than is safe, necessary or economic. The speculators and lending companies appear to have learned little or nothing from the slums and the holocaust of real estate wrecks that have resulted from the absence of greater restrictions.

The memo requests that the City Club Board of Trustees “appeal to the Mayor and the Board of Estimate and Apportionment for the prompt appointment of a new Zoning Commission.”

In response, the president of the City Club, Richard S. Childs, sent a letter to Mayor La Guardia urging immediate zoning reform. The memo and letter made good copy and was picked up by the New York Times on September 16, 1935. The headline, “City Urged to End Density Building,” quoted Ackerman’s employment population figures of 340 million.  The reporter turned to Kohn for a statement, who opined, “We must not allow the present opportunity to escape us to put a stop to such further crowding of land as will make the damage irreparable.”

Though I don’t have a copy of the Childs letter, it evidently, “urged that a blanket amendment be adopted substantially reducing the ratio of permissible bulk of residential buildings to lot area,” as declared in a “proposed report” written in March 1936 (discussed below). We can thus see that the idea of the FAR was created by Kohn’s Committee, transmitted to Childs, and then to Mayor La Guardia by September 1935.

In November, the City Club’s Housing Committee met with the Mayor’s Committee on City Planning. This then led to the creation of a Board of Alderman sub-committee whose membership drew from the City Club (and which included Kohn but not Ackerman), the Mayor’s Committee on City Planning, and other city officials.

A Rezoning Proposal, 1936

On March 1, 1936, this committee submitted its “Proposed Report” to the City Club Trustees and the Mayor’s Committee on City Planning. It recommended that the Floor Area Ratio be incorporated into zoning code amendments. We can say that the FAR was born on March 1, 1936.

The proposed report states, for example,

In substance, the proposed formula if adopted would affect the bulk of any residential building hereafter erected in the city by restricting the sum of its gross floor areas to a certain multiple of the total area of the lot on which it is built. Thus in an apartment housing built in a “two times” A or B area districts the maximum permissible total of its gross floor area would be five times the area of its lot.4

In short, it proposed adding FAR limits to the existing lot coverage zones.

A Plan for Rezoning the City, 1938

But this was just one committee’s proposal. Reports and recommendations get written all the time. While I’ve never seen a statistical study that evaluates the likelihood of any randomly written report getting turned into law, one can reasonably say that official committee reports are typically where good ideas go to die. But in this case, the report had legs.

The ideas reappeared in 1938 in “Zoning for the City of New York,” funded by the WPA and prepared for the Mayor’s Committee on City Planning. Kohn was not a member of this group, but its findings were a result of the ones from 1936.

The importance of this report is that it lays out in detail a new method of rezoning the city. Rather than having three separate maps as in the 1916 zoning codes—one for height setbacks, one for lot coverage, and one for building use or type—it urges that use and bulk be regulated simultaneously within prescribed zones—a concept that was eventually adopted citywide in 1961.

Just as importantly, this report included the FAR concept from the 1936 report. It says,

The bulk provisions are very much along the lines explored by the Joint Zoning Committee of the Mayor’s Committee on City Planning and the City Club of New York. Actually, they are an outgrowth of the Committee’s memorandum, resulting from a very comprehensive series of practical tests, which applied the original standards to a wide range of building types on lots of various sizes, abutting streets of different widths….In all cases, the permitted bulk is measured as the ratio of the number of square feet of gross floor area to the gross area of the lot in square feet. (Emphasis added.)

This was the pivotal report that took the FAR idea introduced by Kohn et al. in 1935 and turned it into a proposed new method for rezoning the city.

The Zoning Code Amendments, 1939-1940

A full-scale rezoning, however, would have to wait. Though the concepts were out in the open, the support for comprehensive changes was not yet there. But, in 1939, the City Planning Commission offered a “Proposed Revision of the Building Zoning Code Resolution,” which contained language for updates to the 1916 codes.5 In 1940, the city passed it into law. It maintained the use, setback, coverage zones but added floor area ratio limits into two new low-density residential districts—E and F—which were reserved for free-standing homes or garden apartments. F districts had a maximum FAR of 0.75, for example.

After the War: The FAR Grows Up

On December 7, 1941, Japanese air forces bombed Pearl Harbor. Any discussion of rezoning the city would now have to wait. However, after peace was restored, cities across the U.S. revived the discussion of urban planning. In the late 1940s, New York began thinking about implementing the FAR citywide. This would finally happen in 1961, when New York City passed a new zoning resolution. In the next post, we see how cities across America after World War II pushed the FAR much FARthur.

 

Continue reading Part I of this blog series on the birth of modern zoning during the 1920s here.

 

Thanks to Maria Thompson for editorial assistance.

—

1 In this respect, they were both against the ideas of Jane Jacobs, who embraced density and the “IDIC” it produced.

2 When at the University of Chicago, Veblen was the managing editor of the Journal of Political Economy, which today is one of the top five journals in economics. Today, the journal would never publish an article in the style or containing subject matter along Veblen’s lines. He remains on the fringes of economic thought for several reasons: He rejected capitalism and the neoclassical economists who supported it. His style was obtuse, his meaning and intentions were often unclear, and he promulgated vague general theories with few testable hypotheses.

3 This recount of the City Club events is based on archival documents housed in the New York Historical Society (NYHS), City Club Minutes Volume 22 (MS116). Though not all the documents are directly relevant to the formation of the Floor Area Ratio, and many of the Housing Committee’s documents are not there, enough exists to prove that Kohn was the lead author of a 1935 memorandum suggesting the city embrace the FAR for zoning policy.

4  This report is at the NY Historical Society, though they don’t have the proposed maps.

5 The history and early battles of the New York City Planning Commission, formed in 1938, will be taken up in a future post.

by Jason Barr 4 Comments

Six Policy Ideas for the Next Mayor of New York City

Jason M. Barr              June 22, 2021

Today is primary day, and New Yorkers are heading to the polls. This year, the Big Apple is using ranked choice voting, a bold new experiment in democracy. It shows that New York is still capable of adjusting policies when the need arises. And now that the state has eliminated nearly all pandemic-related restrictions, the city is poised for a rebound.

The next mayor will need to deal with several issues put aside because of the pandemic: Improving housing affordability and fixing transportation. These problems stem from decisions made over sixty years ago. Attempts to alter course have run into push-back from residents who resist policies that will aid in wide scale modernization. Bolder approaches are required to bring New York fully into the 21st century.

The ultimate question then is: How does New York reform itself in a way that does not just tinker on the margins but embraces much-needed, larger-scale reforms? To this end, I propose six policy ideas that will help grease the wheels of change and allow the city to accommodate a larger population while improving affordability and the quality of life.

New York City Subway Map. While adding subway lines will helpful for New York, the next mayor should institute a transportation pricing scheme that charges fares and tolls based on changing supply and demand conditions throughout the day.

1. The Transportation System

The Problem

New York’s transportation system is outdated and too easily subject to frustrating congestion and delays. Nearly all the various routes and modes we have today were completed by 1960, and there have been no significant increases in subway lines, highways, railroads, and bridges and tunnels since then.[1] The transportation system is like an overweight 45-year-old man trying to cram into the same jeans he wore in college. The problem is made worse by the decentralized nature of management. Subways and buses are operated by one agency, another maintains the highways, and multiple entities oversee the bridges and tunnels.

The Policy Solution

The goal of any transportation network should be maximum mobility—to move as many people as quickly and efficiently as possible. The solution begins when the city considers all types of transportation—car-based, rail and subway, and bike and pedestrian—as one interconnected system. Then, using big data technology, the system should be operated to allocate this finite resource much more efficiently.

Prices should be continuously set based on relative supply and demand. Prices for congested routes should quickly become expensive, while costs for uncongested routes get reduced nearly instantaneously. If a specific bus line is underutilized while a close-by subway line is over-utilized, prices should rise for the subway and fall for the bus. This means that some routes can be free or nearly free, while parallel but congested routes are relatively costly. This also means that all tunnels and bridges need to have tolls, which should move up or down based on congestion levels, and how empty or full the city’s streets are at any given time. The pricing scheme also applies to street parking meters.

Prices can be announced via a website, mobile phone app, on digital signs at bus and subway stops, and on billboards. Data analysis can also reveal what trips will cost and their likely duration say 30 to 60 minutes ahead, to help travelers better plan. During rush hour, people would choose the alternatives that entail the best benefit to cost ratio. Not in a rush? Take a cheaper but longer option. In a hurry? Take the route that gets you there quickest, but possibly at high expense. In this way, people have complete information about the best way to travel, facilitating the movement of the most people possible and limiting congestion and frustration.

2. Zoning and Housing Affordability

The Problem

New York City regulates land uses and building densities through zoning. The last time New York undertook a citywide rezoning was in 1961, which was a massive reduction in allowable density from the previous set of rules established in 1916. This was accomplished by limiting the so-called floor area ratio (FAR), which gives the maximum square footage that can be built on a lot. The FAR is given in multiples, so an FAR of 1 means that for a 2,500 square foot lot, 2,500 square feet of floor area can be erected. With a FAR of 10, reserved for the densest residential neighborhoods, a developer can build a 10-story building on the whole lot or, say, a 20-story building on half the lot.

One of the main ways to make housing more affordable is through new supply—more units from new construction, subdividing houses, or conversions. The current zoning regulations act as a barrier against new construction, causing housing costs to rise. For example, it is illegal in over half of New York’s residential land to build anything that is not a one- or two-family home.

This was by design. The 1961 zoning codes originated from two—now obsolete—core beliefs. First was that urban density was an evil that must be curved through strict zoning regulations. And second, New York City should zone itself for stabilization rather than growth. From 1960 to the early 1990s, that assumption was born out because of population declines and big-city problems. But since Gotham’s renaissance, those notions have become outmoded and harmful.

The Policy Solution

However, any significant adjustments to the zoning rules, naturally, lead to the cry, “Not in my backyard!” because of the fear that change will harm neighborhoods and affordability while seemingly to be applied unfairly.  To help solve these problems, the city needs to implement “automatic rezonings” that loosen FARs based on four key affordability metrics.

  1. The 30% rule: The majority of low-income renters should be paying 30% or less of their income on rent.
  2. Rental vacancy rates: A higher vacancy rate (due to extra supply) gives apartment dwellers more options and lower prices. A vacancy rate close to 10% is healthier for the market.[2]
  3. The 4 to 1 rule: The median house price should not be more than four times the median household income since, at that ratio, housing costs will remain at or below 30% of household income for most people.
  4. The “Astor Index”: Officials should compare the cost of vacant lot sales to land values with buildings on them. If vacant lot prices diverge from land values with structures, there is a “shortage” of land in the neighborhood.

When the “needle turns red”—when these indicators hit certain thresholds—the market is signaling that local housing costs are too high and would benefit from new supply. This would automatically trigger a neighborhood upzoning of, say, 0.5 FAR “points.” So, if you live on a property with an FAR of 1, the rezoning becomes 1.5. Neighborhoods very close to subway or rail lines should get higher FAR adjustments to encourage more sustainable transit-oriented design.

The benefits of automatic rezonings are: First they are not gameable, given they are automatic. Second, they apply to everyone and are fair based on observable, clear metrics. No neighborhood is singled out. Housing will get built where it is in the most demand. The extra supply will moderate prices—in all communities.

New York City Zoning Map. The map shows the maximum allowable residential floor area ratio for each lot in the city. The majority is zoned for one- or two-family homes.

3. Neighborhood Infrastructure and Services

The Problem

Another problem that generates resistance to change is the fear that neighborhoods will be gummed up with congestion after a rezoning. However, careful planning can assuage people’s fears and improve neighborhood quality.

The Policy Solution

The way to do this is to announce ahead of time automatic infrastructure and public services upgrades when the population is close to hitting a new threshold. The city should maintain key metrics—so many acres of park space per 1,000 people per neighborhood, for example. When the population grows by 1,000 people, the city adds that much more acreage. The same system can be implemented with schools, bike lanes, etc. Residents need confidence that the quality of their lives will improve as their neighborhood densifies. These upgrades can be paid for by the economic growth engendered by more people moving in.

4. Land Value Insurance to Reduce NIMBYism

The Problem

One reason why homeowners cry, “Not in my backyard!” is due to the fear that changes will negatively impact their home values, which, for many families, is the largest component of their wealth.

The Solution

To assuage fears that change will not harm their investments, the city needs to create a land value insurance program. When a household purchases a house, the program determines the property’s value and how much of the value comes from the structure versus how much comes from the land. For a fee, the homeowners are then insured against reductions in the land values, which are determined by what is going on in the neighborhood.[3] If, for some reason, densification or change should reduce a property’s value, then the homeowner can rest assured that she will not lose the value of her investment.

5. Renters Benefits

The Problem

Until World War II, May 1st of every year in New York was Moving Day. In early February, landlords would give notice of the upcoming rents. The tenants would then look for new housing and the best deals. On May 1st  all leases expired, and mass moving ensued.

The existence of a Moving Day meant that people not only expected to move as their circumstances changed, but also that they could find better deals. It also allowed for more turnover in the housing stock because of increased choices for renters and competition among landlords, which kept prices in check (landlords frequently lured new tenants with a free month’s rent—a hearty discount).

In the 21st century, New York has become an “immobile” city in the sense that there are tremendous forces at work that prevent people from leaving their residences, even if they want to move. A large fraction of renters is getting below-market rates through rent stabilization. If they move, there is a good chance they will have to pay more. Similarly, homeownership keeps people in their houses for much longer because it takes time to develop a large equity stake if you have a 30-year mortgage.

The problem is that the lower the turnover, the less dynamic is the real estate market. A dynamic market allows for better matching of supply with demand. When people are willing to move (to get better deals or better-quality units as they come online), the easier it is for a landlord to empty a building, and the faster it can be redeveloped to add housing units. More dynamism means more supply and lower prices.

The Policy Solution

The city should create policies that help renters against the vagaries of the market (more housing availability is a big way) and encourage would-be owners to rent. A problem with homeownership is that it turns households into “banks”—the home becomes a store of wealth, so homeowners do what they can to ensure monopoly power over their investment by limiting competition—i.e., by stopping or slowing down new construction. If renting were more of an appealing option, it would give the market more flexibility to match housing supply with housing demand.[4]

Renters Savings Accounts

The next mayor should work toward creating renters savings accounts. The idea is that renters would add an extra payment each month on top of their monthly rent, going directly into a savings account, say 3-5%. The state would make sure the account offers a minimum return. This way, renters can create wealth similar to a homeowner. Plus, if the tenant falls on hard times, the savings can be used to stave off eviction (thus also reducing homelessness).

Eviction Vouchers

Densifying neighborhoods means getting people to move out of lower-density homes or apartment buildings so developers can build more housing. Suppose a property owner empties her rental building to tear it down and erect a denser structure. In that case, the evicted occupants should get a voucher or payment from the city to move to another location nearby.

Stuyvesant Town in Manhattan. StuyTown is one of many large private housing developments in the city built after World War II. New York should encourage new developments like this, especially in the outer boroughs, as way to add to the affordable housing stock.

6. Revisit Large Housing Developments

The Problem

While the above policies are designed to create more housing options and lower prices for the vast majority of residents in the city, the lowest-income residents will always be at a relative disadvantage. For these groups, extra help is needed to incentivize new construction and give low-income renters more affordable options.

In low-income neighborhoods, upzonings may not trigger new construction since construction costs are so high. Housing vouchers can help households, but only if voucher holders are on equal footing with non-voucher holders. For this to be the case, there must be significant housing vacancy, which gives renters a relative advantage with landlords. Construction subsidies can also help, especially if builders in low-income neighborhoods get relatively greater subsidies than upper-income areas. But the city should revisit getting back into the large-scale housing game.

Policy Solution

Today we see large-scale, low-income housing developments in a bad light. The mistakes of public housing have severely damaged the government’s reputation when it comes to providing low-income housing. However, part of the success or benefits of large housing developments is that they can take advantage of economies of scale. By building everything at once over a large land area and arranging the buildings and infrastructure more efficiently, housing can be built more cheaply on a per-unit basis.

We tend to forget that from the 1950s to 1970s, large privately-owned housing developments were erected, which gained the benefits from scale: Stuyvesant Town Village in Manhattan, Coop City in the Bronx, and LeFrak City in Queens, to name a few. Admittedly, Jane Jacobs soured America on these kinds of urban projects. But, in the 21st century, they can be built to allow for more affordable housing construction and adhere to good urban policy designs.

In this vein, the next mayor should establish a land-lease authority. The authority buys up large lots, especially old industrial areas in the outer boroughs, cleans them up, and prepares them for redevelopment. Next it issues a call for development to private developers, which specifies the important parameters: the population density, the number of units, the amount of units for low-income residents, and the types of services and infrastructure to be provided. The authority then auctions off the construction rights to the winning developer by issuing a 50- or 75-year lease.

In other words, the authority initiates the development through an auction. The winning bidder pays for the land lease, and bids based on a calculation of how much the developer can pay and to get a sufficient return on investment. This process is done in many Asian cities and has the benefit that the city gets much-needed housing, the developer locks in a minimum return, and the land value gains get captured by the municipality.

The Future of New York

While the COVID pandemic has made us rethink the nature and functions of cities, the truth is that cities are the engines of our modern world—they provide jobs, entertainment and culture, and housing. New York City will continue its global importance. But for too long, Gotham has pretended that it can move into the future by tinkering on the margins. The time has come for the next mayor to embrace new policies that incentivizes change for the better and allows the city to embrace its greatness.

 

I would like to thank Maria Thompson for editorial assistance.

—

[1] While there have been some important completed or initiated projects, like the Second Avenue subway, the AirTrain to JFK Airport, the East Side Access tunnel to Grand Central Station, and congestion pricing in Manhattan, they do not fundamentally alter the problem—the system is still a 20th-century one.

[2] Before the pandemic, apartment vacancies in the rent-stabilized and non-stabilized sectors were 2.4% and 6.1%, respectively. A higher vacancy rate is better for consumers.

[3] Homeowners would not be insured against the value of their structures, so as not to create an incentive to under-maintain the property.

[4] Note that I am not saying we should eliminate homeownership. But I am saying that renting should be made more appealing.

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