Urban Institute — Land Use Convening

Visit Grantee Site

Table of Contents

 

Urban Institute staff reviewed this page prior to publication.

Note: This page was created using content published by Good Ventures and GiveWell, the organizations that created the Open Philanthropy Project, before this website was launched. Uses of “we” and “our” on this page may therefore refer to Good Ventures or GiveWell, but they still represent the work of the Open Philanthropy Project.

The Open Philanthropy Project recommended a grant of $97,865 to the Urban Institute to support its work on housing supply constraints in the Washington, D.C. metropolitan area.

The Urban Institute is a think tank based in Washington, D.C. with a focus on poverty and urban issues. As part of our exploration of land use reform (which is a priority cause for us), we started a conversation with the Urban Institute to explore potential projects around easing constraints on the supply of housing.

After discussing several potential projects with Urban Institute staff, we decided to fund a research project and convening aimed at identifying policy changes that would allow more housing supply in the Washington, D.C. metropolitan area. We see the convening as a way to generate new proposals and potential coalitions that we could perhaps eventually support, and as a relatively low-stakes pilot project that will let us learn more about working with the Urban Institute.

Details follow.

A brief post-grant update is available below.

Rationale for the grant

The cause

As of the time of this writing, we have identified land use reform (in particular, reforms to enable more housing construction in key supply-constrained metropolitan areas) as a priority cause within our work on U.S. policy (more detail here), and as such have prioritized it for possible grantmaking. This space stands out for the paucity of funding and organizations advocating for increased housing supply.1

The organization

The Urban Institute is a Washington, D.C. based think tank founded by President Lyndon B. Johnson in 1968 with a focus on poverty and urban issues.2 Its Metropolitan Housing and Communities Policy Center focuses on housing affordability and quality of life on the local level,3 and has done substantial work on affordable housing for the Department of Housing and Urban Development (HUD).4 Our impression is that it is respected by affordable housing advocates, and that the quality of its research is well regarded.

Proposed activities

The Urban Institute plans to conduct research and convene researchers, advocates, and policymakers for a day-long meeting to discuss policy changes that would allow more housing supply in the Washington, D.C. metropolitan area.5 This discussion would have two main goals:6

  • Identifying policy changes that would permit more supply. In addition to straightforward changes like upzoning, the agenda would include complementary policies such as changes in how development costs are borne, or better community benefit agreements.
  • Identifying political challenges and opportunities as well as key stakeholders likely to engage in policy change.

Before the event, Urban Institute researchers will conduct interviews with relevant parties, building towards a briefing paper that will shape a day-long convening.7 The structure of the convening will be determined based on the results of these exploratory conversations. Urban plans to invite decisionmakers such as county commissioners, city council, and city staff, as well as academics, advocates, and other interested parties such as builders.

After the convening, the Urban Institute plans to revise and eventually publish its briefing paper.8

The Urban Institute’s proposed budget for this project, including preparatory research and follow-up, is $97,865. $71,565 of this is for staff time, split across several people, and $26,300 pays for assorted other costs. We are not sure how the other costs were calculated, but don’t see them as unreasonable.

Case for the grant

One of the main constraints we see ourselves facing in this area is the availability of partners willing and able to effectively conduct projects aiming to lower barriers to new supply, and we see this project as:

  1. A reasonably promising avenue for producing new ideas and initiatives that we might want to support around lowering barriers to housing supply in the D.C. metropolitan area.
  2. A relatively low-stakes pilot project that allows us to learn more about working with the Urban Institute (something we might potentially want to do if this project goes well).

Washington, D.C., where the Urban Institute is based, is one of several major metropolitan areas in the US where land use reform could conceivably provide the greatest benefits,9 and also stands out as a particularly valuable place to work on this issue because of the concentration of media attention there. It is also a metropolitan area the Urban Institute staff knows well and is well-connected in.10

We also see this project as a relatively low-stakes way to explore the potential for further collaboration with the Urban Institute on this issue. A convening is a fairly short, inexpensive project that is comparatively easy to assess. We will likely send a staff member to attend the convening, and we have some existing relationships with individuals and organizations promoting land use reform in the Washington, D.C. area, which we hope will make it easier for us to learn how the convening goes.

Risks and offsetting factors

The main risk we see in supporting this project is that it might be too “academic” – we can easily envision a future in which the convening and associated report effectively identifies the key constraints to housing growth in the D.C. metro area, but does not result in further progress towards reducing the barriers.

We also have some uncertainty around the Urban Institute’s policy priorities with respect to housing, and see some risk that the convening could end up focusing on issues outside of our core priorities.

However, we see these as risks worth running, and we do not anticipate that this grant is likely to cause any harm.

Room for more funding

Our impression is that the Urban Institute would not execute this program without our active interest. We are not aware of other funders interested in funding this kind of program, and the Urban Institute told us that it is not aware of any either.

Plans for learning and follow up

Goals for the grant

We hope that this convening identifies policy changes that would reduce barriers to housing supply growth in the Washington, D.C. metropolitan area, with feasible coalitions that we could potentially support to enact them.

We also expect that this convening will affect our future focus:

  • If the format of this convening works well, we may explore supporting similar events in other key metropolitan areas.
  • We also see this as an opportunity to test working with the Urban Institute as a partner on this issue. Some of the other projects we discussed with the Urban Institute, such as potentially adding a housing cost module to their “Mapping America’s Future” project, would likely be significantly more expensive and open-ended, so we see this easier-to-evaluate and lower-stakes project as a better place to start. Urban Institute staff told us that they also see this as a way to assess us as a potential partner.

Key questions for follow up

Questions that we hope to eventually try to answer include:

  • How well does the format of a convening work to drive progress on this issue?
    • Does the convening lead to new policy ideas or insights? If so, what?
    • Does the convening generate fundable activities? If so, what?
    • Does the convening lead to political action and ultimately to policy change? If so, what?
    • If it is successful, should we expect this success to be transferable to other key metropolitan areas?
  • Does the Urban Institute’s work on this project continue to align well with our priorities? Do we find it easy to work with and learn from the Urban Institute team?

Follow up expectations

Since the convening is meant, at least partially, to generate information that is useful to us, we expect that an Open Philanthropy Project staff member will participate in it. We will also discuss the convening with other individuals and organizations that work on this issue in the D.C. area to get their perspectives. We expect Urban Institute’s activities related to this grant to be complete within a year,11 and we expect to write up our evaluation of the grant at around that time.

We expect to have a conversation with Urban Institute staff every 3-6 months for the duration of the planned program, with public notes if the conversation warrants it.

We may abandon either or both of these follow-up expectations if land use reform ceases to be a major focus area of ours, or perform more follow-up than planned if the circumstances call for it.

Our process

Our shallow investigation of land use reform identified it as a promising area for US policy advocacy. In private conversations with experts on this issue, the Urban Institute was mentioned as an organization considered credible by housing affordability advocates.

Based on that recommendation, we contacted the Urban Institute and have had several conversations with Urban Institute staff. We worked with them to develop a list of potential projects the Urban Institute could do in this area,12 and then decided to focus our consideration on this project.

August 2016 Update

The convening described above occurred on March 2, 2016, and the final paper from the project was completed in June and is available here. We felt that the convening and research were well-run, but they did not generate proposals for further work that we were immediately interested in supporting. We believe the convening gathered many of the relevant stakeholders and we felt that there were many areas of consensus, but we left it feeling that more explicitly advocacy-oriented activity might be more effective for achieving policy change around housing supply issues in the Washington, D.C. region’s current context. Accordingly, we’re not currently planning to prioritize support for this sort of open-ended research and convening project in other regions.

Sources

DOCUMENT SOURCE
Erika Poethig, Urban Institute Fellow and Director of Urban Policy Initiatives, email on May 29, 2015 Unpublished
GiveWell, Land Use Reform Source
Glaeser, Gyourko, and Saks 2005 Source (archive)
Urban Institute concept note Source
Urban Institute, Metropolitan Housing and Communities Policy Center: About Source (archive)
Urban Institute, Metropolitan Housing and Communities Policy Center: Projects Source (archive)
Urban Institute, Our History Source (archive)
Urban Institute, Strategies for Increasing Housing Supply in High-Cost Cities: DC Case Study Source (archive)
Expand Footnotes Collapse Footnotes

1.See our shallow investigation (GiveWell, Land Use Reform), particularly footnote 23, which lists the organizations working in this space that we are aware of.

2.“In 1968, President Lyndon Johnson founded the Urban Institute to “help solve the problem that weighs heavily on the hearts and minds of all of us—the problem of the American city and its people.” Early attempts to alleviate inner-city poverty and urban unrest were often stabs in the dark without a clear understanding of who would be affected and how. Among Urban’s first contributions was a microsimulation tool that forecasted the combined effects of federal antipoverty programs on family well-being. How did cash benefits, food stamps, tax credits, and other subsidies interact? And how successful were these policies at lifting families out of poverty? Since then, Urban Institute researchers have developed a portfolio of microsimulation models on taxes, health insurance, retirement security, and other issues. Each is built to predict how people, communities, and spending will be affected by proposed policy reforms—giving policymakers crucial information to better shape and target solutions.” Urban Institute, Our History

3.“Housing and place matter. Quality, affordable housing anchors families. And the communities where people live can influence nearly everything in their lives: where they work and how they get there, the quality of schools that their children attend, their health and safety, even their longevity. With an emphasis on place—from cities and suburbs to tribal lands—we investigate the factors that shape the quality of life in American communities.
Our Approach

  • We evaluate the effectiveness of federal, state, and local policies that govern urban housing and the programs—such as HOPE VI and Promise Neighborhoods—that use housing as a platform for change.
  • We work on the ground in cities and neighborhoods: documenting families’ experiences in public housing, testing programs to combat homelessness, and evaluating community-wide strategies for improving children’s lives.
  • We provide residents with neighborhood indicators that allow them to tackle problems in their own communities.
  • We think about what the next generation of housing programs should look like.
  • We test programs designed to help households and distressed neighborhoods build wealth.
  • We build models, like our population projection tool, that help neighborhoods, metropolitan areas, and rural communities imagine and prepare for change.

Our Impact
Our early research on homelessness, subsidized housing, and the dynamics of segregation and discrimination has shaped policy responses and our trajectory as a center. This consistent emphasis on equity and access runs through our work and reinforces our research on housing more broadly.” Urban Institute, Metropolitan Housing and Communities Policy Center: About

4.“The Urban Institute has conducted three of HUD’s four national studies of racial discrimination in the housing market. Commissioned roughly once every decade since 1977, these studies help mark how far the country has traveled on the road to equality and inclusion.” Urban Institute, Metropolitan Housing and Communities Policy Center: Projects

5.“We propose the following sequence of work:
September 2015-January 2016: Background research: Interviews to learn more about barriers to supply expansion in DC, Northern Virginia, and the Maryland suburbs; analysis of recent trends in housing prices and rents, supply, and demand; and assessment of future scenarios for housing demand.
[…]
January-February 2016: Convening: Stakeholder meeting to discuss the findings of the background research, focusing first on assessment of the constraints and second on promising strategies to reduce the constraints.” Urban Institute concept note

6.“We propose a nine-month project to:

  • learn more about the interrelated constraints to housing supply expansion in high-cost cities. Regulations, neighborhood opposition, infrastructure capacity, fiscal stress, property owners’ expectations, and competition from other land uses each play a role and affect one another; and
  • identify potential leverage points that could shift the calculus for the multiple actors involved in
    development decision-making in favor of expanding housing supply.”

Urban Institute concept note

7.“We propose the following sequence of work:
September 2015-January 2016: Background research: Interviews to learn more about barriers to supply expansion in DC, Northern Virginia, and the Maryland suburbs; analysis of recent trends in housing prices and rents, supply, and demand; and assessment of future scenarios for housing demand.

  • Deliverable: Background briefing paper for discussion at a convening (internal until end of project).”

Urban Institute concept note

8.“We propose the following sequence of work:
[…]
March-June 2016: Post-convening analysis and writing: Findings on (a) technical challenges—land supply, density, infrastructure; and (b) political challenges at the jurisdiction, region and state levels; and an appraisal of the replicability of methods used in this project in other high-cost metropolitan regions.

  • Deliverable: Final report, available on the web.”

Urban Institute concept note

9.Economists Edward Glaeser, Joseph Gyourko, and Raven Saks have compared the sale price of housing to the combined cost of construction and price of land in different cities to estimate the level of regulatory “tax” that drives up prices by limiting construction.

“Because the degree of housing market regulation is so difficult to measure, we adopt an alternative approach that is based on neoclassical economic theory. With or without regulation, that theory predicts that competition among builders will ensure that prices equal average costs. In unregulated markets, building heights will rise to the point where the marginal cost of adding an additional floor equals average costs (which will equal the market price). If market restrictions limit the size of a building, free entry of firms still will keep price equal to average cost. However, under the standard assumption of an increasing marginal cost function, both prices and average costs will be above marginal costs. Hence, the key difference between a regulated and an unregulated market is the gap between prices and marginal costs, and we use this difference to measure the extent of housing supply restrictions.” Glaeser, Gyourko, and Saks 2005

They estimate that land use regulations increase housing prices by 19% in Boston, 34% in Los Angeles, 12% in New York, 53% in San Francisco, and 22% in Washington, D.C., while estimates for other areas are generally much smaller (close to zero).

METROPOLITAN AREA HEDONIC PRICE OF LAND ($/SQUARE FOOT) AVERAGE HOUSE VALUE ($) ZONING TAX/HOUSE VALUE
Baltimore 1998 0.88 154,143 0.018
Birmingham 1998 0.13 114,492 0.000
Boston 1998 0.68 236,231 0.186
Chicago 1999 1.62 187,669 0.057
Cincinnati 1999 0.40 133,050 0.000
Detroit 1999 0.37 144,686 0.000
Houston 1998 0.15 103,505 0.000
Los Angeles 1999 2.59 260,744 0.339
Minneapolis 1998 0.38 144,719 0.000
New York 1999 1.38 253,232 0.122
Newport News (Va.) 1998 0.48 127,475 0.207
Oakland 1998 2.34 284,443 0.321
Philadelphia 1999 0.81 135,862 0.000
Pittsburgh 1998 0.70 100,060 0.000
Providence 1998 0.56 148,059 0.000
Rochester 1998 0.21 109,050 0.000
Salt Lake City 1998 0.83 167,541 0.119
San Francisco 1998 4.10 418,890 0.531
San Jose 1998 3.92 385,021 0.469
Tampa 1998 0.37 103,962 0.000
Washington, D.C. 1998 0.64 213,281 0.219

Glaeser, Gyourko, and Saks 2005 Pg 359, Table 4

10.“We propose to focus first on the Washington, DC region. Local governments in the Washington metropolitan area are medium-sized to large cities and counties in two states and the District of Columbia, offering a variety of contexts for considering the role of state governments in regulation and infrastructure investment. The Washington region’s geography is less constrained than New York or San Francisco. Finally, the Urban Institute is located in Washington, making it feasible to travel affordably for interviews and meetings, and has both credibility and recent experience in the exploration of housing supply and affordability.” Urban Institute concept note

11.“March-June 2016: Post-convening analysis and writing: Findings on (a) technical challenges—land supply, density, infrastructure; and (b) political challenges at the jurisdiction, region and state levels; and an appraisal of the replicability of methods used in this project in other high-cost metropolitan regions.

  • Deliverable: Final report, available on the web.”

Urban Institute concept note

12.“We’ve covered a lot of possible topics with you, so I wanted to summarize what we see as the possibilities:

Convenings

  • Learning from successful high-­growth cities (e.g., Houston, Atlanta)
  • Identifying paths forward for global cities experiencing extreme supply constraints beginning with identifying the bucket of policy solutions and then identifying the political steps (e.g., San Francisco, New York, DC)

Case studies

  • Learn from jurisdictions where citizens support high density, transit oriented development, focusing on mobilization efforts, local narratives, and what it takes to shift the politics (e.g., Arlington, Washington, Montgomery County, MD). Mobilizing business organizations
  • Conduct individual case studies or hold a convening with business groups that are working locally to address supply constraints that harm economic competitiveness.
  • We anticipate that a convening of these individuals could help identify organizations that could be the regranter for an executive strategy if you choose to pursue that concept.

Finding shared values among community advocates and business organizations

  • Select one or two cities in which to explore common ground among different constituencies that would support increased housing development.

Mapping America’s Futures

  • Exploring future supply and demand by building new modules to the initial infrastructure

Erika Poethig, Urban Institute Fellow and Director of Urban Policy Initiatives, email on May 29, 2015