Risky Business

December 9, 2021



Well, it’s happened- I got my first request, and I feel like a real-life cover band now. A kind young woman from Alabama called me last week and asked if I could help her frame up an argument to take to her city council about mobile homes being approved within city limits. And I figure a yankee weighing in on the type of housing that’s appropriate for a small Southern city can’t really go wrong, so what the hell. 

So the question is, should mobile homes be allowed in city limits? Of course. We are free and freedom means we can do whatever we want when we want, right? 

But that’s not actually true, so let’s just go ahead and set that whole notion aside. We cannot do whatever we want when we want- this is the social contract and it’s the basis for people living in a functioning society. 

We depend on our local government to make and uphold the rules for our communities. We have collectively agreed upon said rules and use them to maintain order and provide the type of environment that best suits the public. Those standards dictate which behaviors are acceptable and unacceptable, like driving under the influence, and theft. These are examples that are pretty easy to comprehend. Their necessity is obvious and that’s why every city has adopted laws pertaining to them. Except for maybe New Orleans. 

As a society, we are still pretty comfortable upholding the standards that deal with crime, but we have steadily abandoned the standards, we once held dear, pertaining to our built environment. Every single municipality across this country has adopted standards that spell out what is allowed to get built, how it gets built and where it gets built. These codes and ordinances ALSO help maintain a functioning society. 

Long ago, as a nation, we decided that we had to have some guardrails around issues of land-use. We did this for reasons of health and safety, order, fairness, and to protect investment. Ninety-nine years ago the Supreme Court ruled in favor of the City of Euclid, Ohio over the Ambler Realty Company. Euclid enacted zoning restrictions that dictated what what size and types of buildings could be constructed in different sections of the city. Ambler Realty Company owned 68 acres and sued the city, stating that this new ordinance would infringe on their property rights. The Supreme Court ruled 6-3 in favor of Euclid as they found it is within the city’s right to dictate land-use as it is in the interest of public welfare. 

Of course the issue of land-use is has an impact on public welfare. It is imperative that local government dictates what can be built and where it can be built. So, today we will argue that we should be allowed to do whatever we want with our property, but tomorrow we will sing another tune when a meatpacking facility is proposed next door. 

Local government is not only well within its rights to dictate how land is used and how we regulate buildings, it’s wise to do so. Without any protections, there would be incredible health and safety risks. With no standards, people could build toss up any old shotty structure, putting tenants at risk. Without no land-use consideration, nuclear power plants could be the the center of a neighborhood. 

Beyond health and safety, local government uses land-use regulations to protect investment. This is the thing that modern day property rights advocates don’t seem to fully grasp. The notion of property rights was not set out to allow you to do whatever you want with your property, but instead to ensure that what happened around you would not negatively impact your use of your property and its value. Property rights are a means to protect and encourage investment, not an excuse for poor behavior. 

It is certainly within a city’s rights to allow anything to get built anywhere, but it is much to its own detriment to take such a stance. Doing away with all traffic rules would make driving too risky and most people would avoid the roads, doing away with all ordinances pertaining to property will make investors want to avoid your city. The risk is just too great. With no protections in place, it becomes far too unsafe of a place for anyone to put their money. 

The idea behind property rights is to create a situation where there is some semblance of security, a predictable environment in which it is safe to work and there are reasonable expectations of what the community will be like in 5 years and 10 years. When we throw out those standards, a place becomes completely unpredictable. 

Let’s say Jenny is civic minded and profit motivated and with some money she inherited she wants nothing more than to renovate a couple of houses in one of the communities in her county. She visits Freedomsburg and walks around the neighborhood. Half of the lots are empty, the existing houses are in disrepair, the grass is too tall porches are sagging and a handful of mobile homes are peppered in with the rest. She comes away with a bleak view of the town, the people that live there, the people that run it and its overall lack of standards. Next she visits, Standardslandia and walks around a few blocks. There are no vacant lots, the sidewalks are well maintained, grass is cut and the houses are all similar in appearance and in good condition. 

Where do you think Jenny is going to invest her money? Where would you invest your money? Jenny can see from her visit to both towns that there is just far too much risk to put her money into the first town. There is no protection, she would likely lose wiped out because the local government has decided that there are no guardrails. While the second town is more expensive and requires a more onerous process to tackle the project, it comes with very little risk. The city has put in safeguards to protect people’s property rights and therefore to protect their investment. 

While Freedomsburg thought that by making it easy and cheap to do business and taking a hands-off approach would attract all the investors, they unwittingly did just the opposite. By having no safeguards, they have created an environment that is far too risky. In the end, investors would like a project to be cheap and easy, of course, but those concerns pale in comparison to risk. By putting in place regulatory protections, Standarslandia has created a very safe (low risk) environment for investors. 

So back to the question at hand. Should my reader’s town allow mobile homes within city limits? It is well within their right to do so, municipal government is charged with setting and maintaining the standards of the community. So the real question then is, is there a cost to lowering standards from previous levels or not having them at all? Unequivocally, there is a cost.

It is not an issue of mobile homes either, this is not a class argument. It has nothing to do with mobile homes or the socio-economic conditions of the people that own them, it has everything to do with the investments that have already been made in the neighborhood and standards that have already been set. A 1930’s craftsman neighborhood would be damaged just as much from a Mcmansion as it would from mobile homes. It is not an issue of who occupies the home, but the design of the home itself and the context in which it is in. How will changing the existing standard affect the neighborhood and those that have already invested in it? 

On a side note, maybe cities struggling with these issues should contemplate addressing their affordable housing problem. 

The issue we have to accept first before we can move forward with a decision, is that there are standards in the first place. That this not an all or nothing environment, this is not black or white, not take or leave, not all or nothing. What this isn’t, is an argument of whether or not there are standards. There are. We don’t going to debate if there is a speed limit, but decide what it will be. We don’t debate whether theft is illegal, but what constitutes theft and what the punishment shall be. 

There is no debate as to whether or not there are rules and regulations pertaining to land-use. There are. The issue lies in determining where those standards lie. This is where a community must decide what is acceptable, what it wants to be, how does it want to appear and how shall it behave. It is entirely up to this particular community to drop its standards and allow anything to get built, but it would be wise to consider the cost of this. Would this approach benefit the community in any meaningful way? No, the idea of dropping these standards would go directly in the face of what the Supreme Court intended when it ruled 6-3 in favor of the City of Euclid. By upholding the city’s decision to put in place land-use standards, the court was giving Euclid permission to act on behalf of the public and their well-being. It isn’t a question of property rights in the end, but a question of what your city is wiling to accept and whether it will allow an individual’s preferences to diminish the health of the community as a whole.


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