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The OECD’s work on the Governance of Land UseTamara KrawchenkoEconomist/Policy [email protected] 10, 2016
• The governance of land use project• Selected findings from MRDH
review• Metropolitan governance in the
MRDH & across the OECD– Making metropolitan governance
models work
Today’s presentation
The governance of land use
The governance of land use work in GOV
Pillar 1: Breadth (all OECD)
• Overview of formal land use planning systems across the OECD and description of common characteristics, typical features etc.
• Econometric analysis of the relation between characteristics of land use planning systems, property tax revenues and land use patterns
• Short profiles and diagrams of the formal spatial planning system, summary table of relevant land use statistics (3-4 pages per country)
Pillar 2: Depth (case studies)
• Spatial and land use planning for each country as a whole, including fiscal relations, key reforms and major challenges.
• In depth case studies of Lodz, Umm al-Fahm, Netanya, Clermont-Ferrand, Nantes Saint-Nazaire, Amsterdam, Prague.
– Background: social and economic profile, urban morphology, housing and real estate, major land use pressures.
– Governance, spatial and land use plans, fiscal relations and instruments.
– System of incentives and disincentives and how they work together (or not).
• Assessments and recommendations for reformOutput:• Manuscripts per country (90-130 pages each).
Joint output: Synthesis report
Pillar 1: Case studies
• Very different cities: Lodz, Umm al-Fahm, Netanya, Clermont-Ferrand, Nantes Saint-Nazaire, Amsterdam, Prague.
• Flexible versus rigid systems• High versus low levels of social trust• Consensus driven versus conflictual (and
litigious) planning
The big picture
How land is used now and in the future
InstitutionsGovernance, legislation, rules, regulations, policies, plans, fiscal frameworks,
and the patterns of incentives and disincentives they create.
Mode of control or influence
Social norms (e.g. home size, locale)Social cohesion and trust (conflict and plan elaboration)
Economic land uses, industrial compositionSocial-economic and demographic characteristics and change over time
Legacies of the build environment and changing urban morphologyGeographical features of the environment
And so on…..
Exogenous to the planning system
The big questions—governance and scale
• What is the role of government when it comes to how land is used now and into the future?
• What can plans achieve and what can they not achieve?
• How can rural and urban locales coordinate and cooperate on land use?
• At what scale should planning issues be tacked? What are the trade-offs?
• What is the role of regions vis-a vis land use planning?
• How to effectively engage citizens and other stakeholders in participatory planning—particularly when scale and complexity present obstacles? When and when not to engage?
The big questions—the system
• How to balance the desire for a flexible and adaptive system against the need for certainty and fairness?
• How to design a system that can address complexity and change over time, while at the same time streamline the system and its procedures?
• How to ensure that the multiple incentives and incentives within the formal planning system and those outside of it pull in the same direction?
The big questions—negotiating trade-offs
• How to balance the goals of environmental sustainability and social equity?
• How to balance the demands of economic growth and expansion against liveability-wellbeing considerations?
Main message of this work
• Spatial policies have ambitious goals but often limited and restrictive tools within the planning system to realise them
• A wide range of policies outside the planning systems affects land use
• More integrated approaches can make land use planning more flexible and more effective
From government to governance
• Multiple actors across multiple scales
• This is has benefits and drawbacks• Links to political
authority and accountability can be weak
• Not clear how funds are structured and spent—who pays and who benefits?
• Links between strategic scale and implementation can be weak
• Strategic spatial planning
• Multi sectoral considerations
• Diversity of voices and concerns
Metropolitan planning is growing in importance
• There is a growth in metropolitan planning institutions
• State policies have been highly instrumental in encouraging this.– E.g., Territorial coherence plans in
France (SCoT)• Places where planning ignores
functional spaces/connections encounter major planning challenges
Housing costs have risen strongly in most OECD countries
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 201540
100
160
220
280
340
400
Australia Belgium Canada SwitzerlandGermany Denmark Spain FinlandFrance United Kingdom Ireland ItalyJapan Netherlands Norway New ZealandSweden United States Average
Inflation-adjusted property prices
Many factors are responsible (e.g. low interest rates), but evidence suggests that land use restrictions are at least partially to blame
The need for flexible planning
• Planning is too slow to respond to changing economic, demographic and social conditions
• Planning can be an answer to market-failures, but may also prevent efficient market solutions from emerging
• Restrictive land use regulations prevent densification
• Single-use zoning makes mixed-use developments impossible
• Planning can serve as a barrier-to-entry and restrict competition
The need to consider incentives
• Already today planning does not achieve many objectives
• If planning becomes more flexible, how can spatial objectives be achieved?
• Our answer: better align the incentives for land use that public policies outside the planning system provide
How land is used
Public policies aimed at steering land use
• Spatial planning• Land use planning• Environmental regulations • Building code regulations
Public policies not targeted at land use
• Tax policies • Fiscal systems and inter-
governmental transfers • Agricultural policies • Energy policies
How land is permitted to be used How individuals and businesses want to use land
How public policy affects land use
Paying greater attention to incentives
• By paying greater attention to the incentives that public policy provides for land use, planning can become less restrictive and more effective
• Taxes and fiscal systems matter most• Regulatory and economic instruments need
to be combined Effective governance mechanisms are a
prerequisite for a successful implementation
Fiscal systems incentivise local governments’ planning policies
• Fiscal systems create incentives for local governments to pursue specific planning policies– Reliance on own-source revenues linked to land
leads to expansionary planning and vice versa• Local governments respond strategically to
land use policies in neighbouring jurisdictions (risk of negative feedback effects)
• Local tax and land use policies may be used to attract desirable newcomers (e.g. high income residents) and keep out others
Fiscal systems incentivise land use decisions by firms and individuals
• Currently, property taxes do not provide strong incentives for specific land use – But can achieve many objectives if well structured
• Costs of road transport most important factor for land use patterns in 20th century– Car transport is under-priced Incentives for sprawl
• Farming only possible with subsidies in much of the OECD– 0.7% of GDP, approximately 18% of farm revenues – Subsidies can lead to mono-cultures and loss of bio-
diversity; well-structured, they may preserve heritage landscapes and biodiversity
Incentive-based policies to steer land use exist, but are underutilised
• Brownfield redevelopment incentives
• Historic rehabilitation tax credits• Transfer of development rights• Use-value tax assessment• Development impact fees• Betterment levies
• Three chapters: i) key trends and challenges; ii) policies; iii) governance
• Opportunities and risks under new Environment and Planning Act
• There will be great interest from other OECD members in your approach
The governance of land use in Amsterdam
Selected findings from the Metropolitan Review of MRDH
The Netherlands could be getting more out of its largest cities
Labour productivity of select European FUAs Sorted by population size (2010)
Labo
ur p
rodu
ctivi
ty
GDP
per
wor
ker (
USD
PPP
2005
)
The MRDH faces pressing challenges
Unemployment rate (2014)
Unem
ploy
men
t rat
e (2
014)
• Past policies (housing, spatial planning) targeted growth centres outside major cities
• Polycentric spatial structure: a drag on productivity in small countries?
Why aren’t Dutch cities doing better?
• Eight city-regions abolished (January 2015), responsibilities transferred to municipal & provincial governments
• Rotterdam, The Hague & 21 surrounding cities join forces to acquire EUR 475 million in transport funds/functions
The MRDH is formed
• In parallel, these 23 municipalities agree to voluntarily co-operate on economic development
Dual policy fields of MRDH
• The new National Urban Agenda (Agenda Stad)
Institutional arrangements can help strengthen cities
2011
The MRDH is a metropolitan area in the making: Commuting flowsCommuting trends in the MRDH: 2001, 2011, 2020
2001The Hague
Rotterdam
2020
?
• Policies and strategies to enable greater economic integration– Increased integration: a means to what end?– A long-term process that will result from a range of actions– Focusing inward, while looking outward
• Tools for better co-operation– Adding value in a crowded institutional environment– Co-operation for what? – Redefining relationships with other levels of government
Making the MRDH effective in the short and long term
Metropolitan governance in the MRDH and across the OECD
• Limited business interactions between different parts of the MRDH– Links between firms: only 9% of the
core of Rotterdam’s business interactions are with firms in The Hague (Van Oort, Burger and Raspe, 2010; Ruimtelijk Planbureau, 2006)
The MRDH is a metropolitan area in the making: Economic interactions
• Reduce administrative fragmentation:– Council of MRDH– 23 municipalities
• Facilitate decision-making and service provision at the right scale– Transport, economic development, spatial planning,
housing
• “Look big”
The MRDH is a metropolitan area in the making: Co-operation pays
Where does the MRDH stand vis-à-vis metro authorities in the OECD?
Co-operative structure
Policy fields of competency
Staffing & budget
Organisational model
Hybrid: top-down & bottom-up
Unique
Transport & economic development
Common (70% and 80%), but no spatial planning (>60%)
95 staff (80/15)~ EUR 475M/5.5M
More modest, but in line with more limited functions
Non-elected metropolitan authority
Barcelona, Montreal, Vancouver (unlike London, Portland)
Geographic coverage & size
23 municipalities, 2.3 million inhabitants
Amsterdam, Portland, Vancouver
MRDH Other OECD metro bodies
• Build on (underestimated?) regional assets
• Focus inward, while looking outward• Align policies for spatial planning,
housing, transport and economic development
• Be bold, but be patient– Economic integration is not automatic, and will
take time
Making the most of the MRDH:Building blocks for greater integration
Challenge: • Constrained labour mobility, due to
allocation of social housing and a limited private rental sector
Recommendations: • Merge the two waiting lists for social
housing in the MRDH• Facilitate development of private rental
market
Making the most of the MRDH: Policy focus - housing
Lessons for OECD countries: The making of a metropolitan region
• An institution to match the reality you want: the MRDH authority aims to anticipate – and ideally, shape – future metropolitan dynamics
• Hybrid structure: a bottom-up & top-down co-operative structure to manage two related policy fields
• Evolving relationships: redefining relationships (and competencies?) between levels of government (e.g. inter-municipal co-operation, metropolitan & provincial authorities, national view of cities) is an ongoing process
Thank you