Tuesday, May 01, 2007

Proof Positive Of Moratorium Success: Stopping The Inevitable

Developer Jackie Welch, in an interview with The Commercial Appeal, said that the county-mandated moratorium has brought development outside Memphis to a standstill.

Our response: good.

That’s clearly not the reaction he’s hoping for with his plaintive comments about not having a subdivision project on the books for the first time in 30 years. Considering the price that taxpayers have paid for his three decades of free rein development, it’s hard to see that as bad news.

Red Herrings

In his alarmist state of mind, he couldn’t even resist pulling out that time-honored red herring about driving people out of Shelby County. Last time we checked, it’s not exactly as if his homebuilding was keeping here in the first place.

But, back on our side of the county line, it’s hard to summon up a great deal of sympathy for Shelby County developers.

Do the words, Gray’s Creek, mean anything to you? After all, it was a multi-million dollar Valentine sent by former Shelby County Mayor Jim Rout and the Shelby County Board of Commissioners to Mr. Welch, opening up a new corridor of development. It came complete with a promise for county financial support for Memphis neighborhood development that never came.

It’s Mental

It was part of the developers-first mentality that is responsible for most of the $1.8 billion in sprawl-related Shelby County debt that’s driven up property tax rates and driven down our quality of life.

After all, despite the misuse of the term in Shelby County, there is no “growth” here. There is only relocation. Population increases are essentially births over deaths, not the result of the in-migration of new residents drawn to Memphis and Shelby County, the kind of real growth that stimulates the economy and the civic culture.

Despite the lack of population growth, Memphis and Shelby County Governments cheerfully ponied up subsidy after subsidy to the development industry in the form of new roads and new schools.

Anything Goes

Movement to the unincorporated area of Shelby County would not have been so devastating if local governments had given equal weight to the redevelopment of existing urban neighborhoods as it did to new greenfields development. After all, it just seemed good financial policy to maximize the infrastructure costs that had already been paid inside of existing neighborhoods.

As a result of the “anything goes” attitude by local government, Shelby County Government finds itself where it is today – burdened down with incredible debt, vastly overbuilt outside Memphis, unsustainable development patterns and fiscal policies devastated by the strained budgets left in their wake.

If Mr. Welch would like to repay the taxpayers of Shelby County for their decades of largesse to his profit margin, he should take up the lead of a campaign for new infill developments in neighborhoods undermined by sprawl and the attendant shift of public money to support vast projects in the unincorporated area of the county.

Livable Communities

Mr. Welch could begin his reprogramming by attending the May 12 symposium by the Coalition for Livable Communities to equip neighborhood leaders to make their voice heard in government, to support smart growth and to learn strategies for improving their own parts of town. If nothing else, he’ll come face-to-face with the problems caused by sprawl and the opportunities that exist if developers would just join in.

Keep in mind that these troubled neighborhoods no longer just exist inside Memphis. They rapidly are including large parts of Bartlett, Millington and even a couple of streets in Germantown. These cities – just like Memphis – are paying the price for the preferential treatment given to developers for decades in Shelby County.

At this point, the nine-month Shelby County moratorium has done nothing so much as save all of us tax dollars. As we’ve pointed out before, the notion that homebuilding produces lots of new taxes for government is a myth. In fact, every new single family detached house valued at $175,000 costs Shelby County Government more than $4,000 a year for 20 years in public services, primarily schools and roads. It takes about 6,000 square feet of commercial/industrial development to offset the deficit to Shelby County that is produced by one residential unit. Of course, in his case, Mr. Welch also was picking most of the sites for new county schools so he was winning on that side of the table too.


Much has been written about the causes of sprawl and most of the attention has been concentrated on Shelby County Government. Lesser understood is the role that Memphis City Government played in undermining its own neighborhoods and devaluing its own infrastructure investments.

This came in the zoning requirement for Memphis City Council to approve all developments in its “extraterritorial jurisdiction,” which generally extended to five miles outside of the Memphis city limits. In other words, City Council had to sign onto the massive apartment complexes and the sprawling residential developments, or they would die.

It was through this process that the foundation for the unholy alliance between some developers and some City Council members was laid.

It’s About Choices

Unfortunately, City Council never treated these votes for what they were – choices. They became political transactions – a vote for a favored developer – rather than the choice between incentives for sprawl and a disincentive for Memphis neighborhoods. They were never treated as decisions on how to best target limited public funds, and as a result, money that could have been spent on existing neighborhoods instead went to financially unsustainable development.

So, while new development opened up by local government thrived, Memphis hollowed out and its neighborhoods declined. We’re not Pollyannish enough to believe that some of this would not have happened any way (particularly as a result of the city’s ineffective crime-fighting strategies), but it’s still difficult to accept the fact that City Council was such a willing co-conspirator to all of this.

Put simply, developers like Mr. Welch are way ahead of the game. They have dominated public processes with their special interests. They have loaded up the Land Use Control Board with their handpicked members. They have corrupted the integrity of the legislative process with their loans to elected officials.

All things being equal, it’s pretty hard to feel sorry for developers these days, particularly when it’s time to pay our property tax bill. And yet, we’ve paid the greatest price of all in the erosion of public confidence in the government that is supposed to be serving its citizens.


Dwayne said...

Thanks for showing Welch and Company for what they are... the new style political bosses of Memphis and Shelby County and the epitome of greed.

Another thing to consider is what he has done within the City. I go up and down Germantown Parkway in Cordova often and see the overdevelopment and the few remaining undeveloped lots with their Welch Realty signs on them. There should be a moratorium there as well.

I know the council and the Mayor will think of tax revenue when they see the sprawl and the bumper to bumper traffic but businesses are already closing.

The area is past its saturation level and risks the possibility of becoming another Winchester in the Hickory Hill area.

Anonymous said...

Posts like this are why I like this blog. You couldn't be more right; it's a shame that our local media doesn't expose this corrupt fraud for what he truly is: a vampire who has sucked Shelby County dry and made himself welathy on tha backs of taxpayers, not to mention bribing public officials to get influence. And Jim Rout should be in jail.

Anonymous said...

But instead Jackie has a big house in Collierville and part of Wolf River Blvd named after him and Jim Rout is head of the Fair Board, aka, the last bastion of the Good Ole Boys. Maybe he's there to finish the Fair off once and for all and have Desoto take it over.

lifestyle said...

I think you got a great blog!! Thank you for that. I'm definitely going to add u to my favorite :)
I hope you can visit my blog at http://www.mohloans.com/ - MOH Loans and Banking

Wish I didn't have to remain anonymous said...

From one who, unfortunately, watched it up close and personal today's blog could not have said it better.

Dwayne - it would have been much different if the Germantown Parkway Plan and the Cordova the Town Plan were followed. Alas, the planners of course were devils and so very wrong in the eyes of the developers and your elected officials. It's ok now though, because they have all been run off. No worry about suggestions of proper planning anymore.

And anonymous #1 and #2, you both are so very right.

One of the most beautiful "new" boulevards in Memphis is named after Jackie and his Daddy (who, by the way, controlled Shelby County Code Enforcement for a decade), and it is a travesty.

Jail might not even be enough for Jim Rout.

Anonymous said...

What is the Germantown Parkway plan? Where is that referenced?