Using Clean-Air Rules to Stop Highway and Other Constructions

Description of Technique
The U.S. Environmental Protection Agency (EPA) analyzes the air quality in major metropolitan areas and may classify that quality as excessively polluted by any one or more of several pollutants. If so, the EPA may issue regulations limiting or prohibiting construction of additional highways that might add to the area’s pollution, if built. It may even prohibit the building of additional pollution-emitting facilities, such as industrial plants or power plants. This technique is permitted under various federal air quality and highway ordinances. This possibility can be used by anti-growth interests to slow down new growth if such growth must be accompanied by additional infrastructure.

Potential Benefits of Technique From General Public Point of View
The potential benefits are as follows:

• In theory, this technique will discourage further population and economic growth in com-munities already plagued by severe air pollution from too much traffic congestion and other causes. That will slow down the worsening of air pollution in those communities due to future growth. This will in turn diminish the number of persons exposed to air pollution levels damaging to their health.

• This technique will also allocate scarce federal highway funds to areas where additional traffic will not cause air pollution to rise above dangerous levels. This will encourage further population and economic growth in those areas.

• This draconian punishment may motivate business firms, governments and consumers in non-attainment areas to change their behavior so as to reduce pollutant emissions. Examples would be using more car pools and public transit for commuting, making fewer driving trips and changing non-transportation uses of polluting substances and processes.

Potential Drawbacks of Technique from General Public Point of View
The potential drawbacks are:

• In order to reduce traffic congestion levels and improve the local quality of life, large, fast-growing areas often need much more additional highway and road construction than areas that are smaller and growing much more slowly. Prohibiting the employment of more federal highway funds in such areas aggravates levels of traffic congestion in the short run, thereby worsening air pollution during the long period of adjustment when such areas continue growing because in-migrants have not yet realized the adverse conditions into which they are moving in there.

• It is often economically more efficient to cluster firms in related industries and activities in a single metropolitan area than to scatter them among many different metropolitan areas. If a region already contains a large and efficient concentration of firms in one line of activity, it would be desirable to permit that concentration to expand by adding more firms in that specialty. An example is the electronics and computer industry in so-called “Silicon Valley” in Santa Clara County, California. This technique would prohibit further expansion of such clusters in areas where air quality has deteriorated below legally-required standards, regardless of the resulting negative impact upon overall national economic efficiency.

• The relationship between human health and specific levels of air quality has not been established with all of the scientific rigor that many proponents of maintaining high levels of air quality claim. In particular, areas can be labeled “non-attainment” for long periods even if they experience levels of air pollution that surpass legal minimums for extremely short periods of time. Thus, with ozone, if an area surpasses 0.12 parts per million for only a single hour in a single day of the year, and that happens three years in a row, the area is considered to be in non-attainment. In other words, surpassing this standard for only 3 hours out of the 26,280 hours in a three-year period—or .01 percent of the time—could put the area out of attainment and thereby jeopardize its eligibility for federal highway funds.

• The economic costs—in terms of human health—of experiencing high levels of air pollution as defined by the EPA may be enormously smaller than the costs of eliminating those levels of pollution. Thus, in the Atlanta region, the Georgia Environmental Protection Division in 1994 estimated that the capital cost of installing the most sophisticated ozone emission controls for large fuel-burning sources would be about $2 billion for electric utilities alone, with very small predicted reductions in ozone levels and small health bene-fits. Yet far more actions would be required to reduce ozone levels to those required by the EPA. It is not clear how many lives, if any, this large investment would save, or what other benefits it would provide.

• In some large metropolitan areas, it may be simply impossible to reduce air pollution to the levels required by current EPA standards without causing massive population movements and immense human dislocation, plus enormous economic costs for reducing polluting emissions. True, experience in Southern California shows that immense improvements in air quality can be achieved over long periods of time through intensive application of many-faceted policies. Yet the continuing inflow of in-migrants into that region may eventually offset much of the impressive gain in air quality that has been achieved over the past three decades. But the nation is not likely to be able to stop continued popula- tion and vehicle growth in that region for decades, if ever.

Practical Lessons from Application of Technique
The Atlanta area is one of the fastest-growing metropolitan regions in the United States; its population rose by 371,000 from 1990 to 1994, or by 91,200 persons per year. (In the sameperiod, the automotive vehicle population of the U.S.—cars, trucks and buses registered—rose by approximately one additional vehicle for every additional human being. Thus, it is likely that over 90,000 vehicles were added to the Atlanta region’s roads each year!) Prohibition of adding any more major roadways there while population keeps on growing will undoubtedly result in rising traffic congestion during peak hours on major traffic arteries. This could cause longer average periods when vehicles are emitting pollutants during their daily commutes. This may increase the levels of air pollution at those times, thereby worsening prevailing air pollution. Rising congestion could therefore cause a slowdown in the movement of population to the region. One firm, Harley Davidson, has already announced it will locate a new plant in Kansas City instead of Atlanta because of air pollution. Since the cost of reducing ozone pollution to the legally-required levels would be enormous, it is not likely that the prohibition against additional federal funding of roads there will be lifted without special dispensation from Congress.

Strategic Considerations for NAIOP Members Faced with Technique
It is desirable for NAIOP and its members to form and maintain long-run strategic alliances with the environmentalist community in each region, rather than adopting a basic stance that seems anti-environment. Such a cooperative strategy is desirable because real estate developers need allies who are less “tainted” in the eyes of the general public and elected officials in order to achieve many policy goals of great importance to future development. Therefore, as a general rule, NAIOP members should attack strongly-held environmentalist positions only after careful consideration, and with some tactfulness. Moreover, the general public clearly favors good air quality and opposes excessive pollution.

Advantages from NAIOP’s Perspective
Insofar as high levels of air pollution are damaging to the health of local residents, and visibly reduce the quality of life in the regions concerned, effectively attempting to reduce those levels can improve the marketability of any future developments in the region. For example, such improvement may persuade firms to locate new facilities in the region when they would have chosen less polluted regions if no such efforts were implemented. Also, cooperating with environmentalist organizations within the region in attacking air pollution may help create an alliance with those organizations that can be very helpful in achieving other public policy objectives favorable to the development community.

Disadvantages from NAIOP’s Perspective
Blanket prohibitions of federal funding for new highways or other infrastructure are clearly not favorable to future developments of any type, since future growth and development will almost certainly need some additional infrastructure to function properly. In some large non-attainment areas, it may be extremely difficult and costly to develop regional programs that are capable of reducing air pollution to the levels legally required by EPA. Thus, prohibition of additional federal funding for infrastructure until “attainment” levels are achieved may be equivalent to permanent prohibition of such funding. This would severely diminish growth and development prospects in such a region.Uncertainties about if and when future federal funding for highways and other infrastructure will be permitted make long-range planning of many future subdivisions and other development projects problematical and costly.

Sources of Further Information
National Center of Environmental Decision-Making Research, “Decisions Related to Ozone Non-attainment in the Atlanta Metropolitan Area: Workshop Briefing Paper,” Web site updated on July 9, 1998.

Research Atlanta, Inc., “The Cost of Nonattainment: Atlanta’s Ozone Imbroglio.”