Open space, forest conservation, and urban sprawl in Maryland suburban subdivisions.

We investigate the effects of these regulations on average lot size empirically using these same data, which are described in detail in Hardie, Lichtenberg, and Nickerson (2007) and Lichtenberg, Tra, and Hardie (2007). Briefly, the dataset comprises a random sample of single-family residential subdivisions approved for development during 1991-1997, in five Maryland counties (Charles, Carroll, Howard, Montgomery, and Prince Georges) in the Baltimore-Washington corridor. It includes information on: the size of developed lots; forest planting requirements under the FCA; zoning requirements; the availability of public water and sewer services; total subdivision size; geographical attributes of the subdivision, such as areas of floodplain and wetlands and linear stream frontage; commuting distances from Washington and Baltimore; the amounts of land surrounding the subdivision in farms, residential use, parks and recreational facilities, and undeveloped forest and brush; and similar information. Information on geographic features of each subdivision, subdivision size, the physical utilization of space within the subdivision (including the number and sizes of building lots and total area in open space), forest conservation plans (including FCA forest planting requirements), and the availability of public sewer service were obtained from county planning agency files. Maryland Property View county databases were used to obtain commuting (road) distance to the nearest central business district (Washington, DC or Baltimore) and the area within a given distance of the centroid of each subdivision in farmland, parks, and recreational facilities, and undeveloped forest and brush (combined). County zoning documents were used to determine minimum lot sizes corresponding to zoning codes obtained from the Property View data. Subdivisions regulated under transferable development rights (Montgomery County) or planned use development zoning (Prince Georges and Charles Counties) were excluded from the analysis, resulting in a usable sample of 229 subdivisions. Descriptive statistics can be found in Lichtenberg, Tra, and Hardie (2007).

Econometric Specification and Estimation

The dependent variables in our econometric models are the (1) average size and (2) number of building lots in each subdivision. Following the conceptual framework, we assume that average lot size is a function of: regulatory restrictions (zoned minimum lot size, the area planted to forest as required by the FCA, and whether the subdivision is exempt from the FCA); the size of the subdivision; geographic features of the subdivision that may limit the way space can be used (area of floodplain and wetland, linear stream frontage); land uses outside but nearby the subdivision (areas of farmland, parks, and forest/brush in a half-mile radius ring outside the subdivision); and the county in which the subdivision is located (a proxy for other regulatory restrictions).

We considered three specification issues: non-linearity, structural differences between subdivisions with and without access to public sewer service, and potential endogeneity of zoning.

We report the results of a linear model (table 1) because the coefficients lend themselves to more intuitive explanations. A log-linear model gave similar results.

The effects of zoning and FCA forest planting requirements may differ according to whether a subdivision has access to public sewer service. In areas without public sewers, public health regulations specifying the amount of land needed for septic systems may supersede minimum lot size zoning and thus also change the implicit cost of incorporating FCA forest plantings into building lots. Likelihood ratio tests rejected the hypothesis of no differences between subdivisions with and without public sewer access in both the linear and log-linear models, so we estimated separate models for these two classes of subdivisions.

It may be appropriate to treat zoning as endogenous because land-use regulations are frequently revised in response to economic pressures (see for example Wallace 1988; McMillan and McDonald 1991; Munneke 2005). Features of the zoning regulations in the counties we consider give further grounds for potential endogeneity. Howard County offers an explicit formula that trades lot size for open space, while other counties set different open space requirements for townhouses and detached homes. However, Hausman tests indicated no correlation between unobserved factors influencing zoned minimum lot size and both average lot size and the number of lots, so we estimated both equations treating zoning as exogenous.

Results

The econometric models for both classes of subdivisions fit the data quite well. The estimated coefficients confirm that zoning influences both average lot size and the number of lots in these subdivisions while FCA forest planting requirements influence average lot size but not the number of lots.

The coefficients of zoned minimum lot size are statistically significantly greater than zero in the average lot size equations; they are less than zero in the number of lots equations (significantly so in subdivisions with public sewer access). Interestingly, the coefficients of zoned minimum lot size are not significantly different from one in either average lot size equation (i.e., a one-acre increase in zoned minimum lot size is associated with a one-acre increase in average lot size). These results suggests that in the absence of minimum lot size zoning developers would provide a larger number of smaller lots, confirming theoretical predictions and empirical evidence from nearby Calvert County obtained by McConnell, Walls, and Kopits (2006) that zoning promotes urban sprawl by reducing density. In subdivisions with access to public sewer service the coefficient of zoned minimum lot size is greater than one in the average lot size equation and quite large in the number of lots equation, suggesting that zoning is highly restrictive in these closer-in areas. It is less than one in the average lot size equation and much smaller in magnitude (and not significantly different from zero) in the number of lots equation in subdivisions without access to public sewer service, possibly because septic system requirements are binding determinants of lot size and siting in these areas.

The coefficient of the FCA forest planting requirement is positive in both equations in both kinds of subdivisions. It is significantly different from zero in the average lot size equation but not in the number of lots equation in subdivisions with access to public sewer service. It is not significantly different from zero in either equation in subdivisions without public sewer access. It is quite small in magnitude in all cases. A one-acre increase in forest planting required under the FCA is associated with increases of a hundredth of an acre in the average size of lots and a quarter of a lot in subdivisions with access to public sewer service. It is associated with increases of a fiftieth of an acre in the average size of lots and less than a hundredth of a lot in subdivisions without public sewer access. These results suggest that developers respond to FCA forest planting requirements in part by incorporating permanent forested acreage into building lots, at least in closer-in subdivisions with public sewer access, but that they do so only to a very limited extent.

These econometric results indicate that FCA planting requirements increase average lot sizes and leave the number of lots per subdivision unchanged, thereby increasing total land in building lots ns. Lichtenberg, Tra, and Hardie (2007) find that FCA planting requirements also increase total open space z + a. The land availability constraint (2) suggests that land in building lots and open space can both increase only if the amount of land allocated to roads, sidewalks, and other forms of infrastructure is reduced. In other words, these results suggest that FCA planting requirements induce developers to lay out building lots and open space to economize on land allocated to infrastructure. It thus appears that even though these forest planting requirements increase average lot size they do not necessarily exacerbate sprawl since they do not appear to increase the amount of land utilized to accommodate any given level of population growth and hence do not push the urban boundary farther into the countryside than would be the case in their absence.

Concluding Remarks

Jurisdictions in rapidly urbanizing areas often enact policies to preserve open space and similar scenic amenities in the face of rising demand triggered by increasing scarcity of those amenities. But some of those policies may induce developers to reduce the number of housing lots within subdivisions, so that population increases result in more extensive development. It is possible, in other words, that open space preservation policies contribute to urban sprawl.