Jurisdictional Size and Residential Development: Are Large-Scale Local Governments More Receptive to Multifamily Housing?

By Nicholas J. Marantz (University of California Irvine) and Paul G. Lewis (Arizona State University)

As World War II drew to a close, residents of an affluent unincorporated area south of Denver, Colorado sought ways to preserve the low-density, single-family character of their community. They were especially alarmed by the possibility of central-city annexation to nearby Denver, which was much more racially, ethnically, and socioeconomically diverse. In order to maintain the community’s low-density single-family residential character, residents voted in 1945 to incorporate a new municipality called Cherry Hills Village. The new local government locked into place the area’s existing zoning, with a 2.5-acre minimum lot size across most of the city. Today, Cherry Hills Village remains an exclusive enclave: As of 2018, 94% of its 6,600 residents were non-Hispanic whites and 98% of its housing units were single-family detached, despite its location near major employment centers. Similar choices about local control and restrictive zoning have been made by electorates and public officials in countless other suburban locales around the United States.

Would development have proceeded much differently if Cherry Hills Village’s six square miles had instead been governed by a much larger-scale local government during the postwar period? For example, might Denver’s mayor and council have been more responsive to the entreaties of developers, major employers, and renters to allow more multifamily housing? Although it may be impossible to answer such historical counterfactuals definitively, it is possible to assess whether the population size of 21st-century jurisdictions is associated with the pace of housing development within those jurisdictions.

Our article in Urban Affairs Review examines data for thousands of U.S. census tracts to assess whether the population size of local jurisdictions matters for the magnitude of change in multifamily housing units. Multifamily housing is an especially policy-relevant topic, as recent years have seen escalating concern over high housing costs, stunted socioeconomic mobility, and lengthy commute times, especially in the nation’s most job-rich metro areas. Scholars have attributed each of these problems to the considerable obstacles that many localities place on the development of apartments, townhouses, and other attached housing. We think the time is right to consider how the institutional arrangements governing land use in America shape important urban outcomes. One of the most elemental institutional dimensions of local governance is the scale of the local jurisdiction that has responsibility for regulating an area’s land use.

We hypothesize that small population size tends to predispose a local government toward a more restrictive posture when regulating multifamily housing development. There are several reasons why jurisdictional size might influence how receptive a local government is to multifamily development. Smaller jurisdictions may be more resistant to new housing simply because the potential problems associated with new projects will affect a larger percentage of existing residents than in larger jurisdictions. Whether the residents’ concerns relate to school crowding, parking, or aesthetics, a 100-unit apartment complex probably will make a much more noticeable impact in a municipality of 4 square miles and 10,000 inhabitants than in a municipality of 40 square miles and 100,000 inhabitants.

In addition, elected officials and civil servants in larger jurisdictions may be more politically insulated from the demands of existing residents concerning land-use regulation. Populous jurisdictions tend to include multiple politically active constituencies and interest groups, of whom homeowner groups are merely one. By contrast, economist William Fischel has conjectured, small-population suburban governments are especially responsive to local homeowners – the primary political constituency in such jurisdictions.

Nevertheless, the very largest jurisdictions could also be distinctively resistant to new multifamily housing development. Whereas many suburbs may be virtually indistinguishable, large jurisdictions may offer a unique bundle of amenities and proximity to employment. Under such conditions, with a single jurisdiction regulating land use in an area of considerable demand, existing homeowners can influence local regulation to extract quasi-monopolistic economic rents by inducing scarcity.

In short, receptiveness to multifamily housing development may be non-linear, with midsized jurisdictions more open to new development than both the smallest and the largest jurisdictions. To test this hypothesis, we study the change in the number of multifamily units in census tracts across the United States. Census tracts, which serve as geographic units of statistical tabulation for the U.S. Census Bureau, are neighborhood-sized areas, averaging about 4,000 in population. We limit our focus to tracts in the built-up portions of large metropolitan areas (of 500,000-plus population), where multifamily housing tends to be most needed but also most controversial. Each of the 11,337 census tracts in our sample is nested within one of 1,487 local governments (e.g., cities, townships, and – in unincorporated areas – counties). Each local government holds responsibility for regulating land use in its constituent census tracts.

We examine multifamily housing development between two recent waves of the Census Bureau’s American Community Survey (ACS) – the 2008-12 wave and the 2014-18 wave – facilitating analysis of the period from roughly the trough of the Great Recession to nearly the peak of the subsequent economic recovery. In considering the role of jurisdictional population size, we control for geographic, demographic, and economic variables that may influence the demand or supply of new housing. Jurisdictional population size and these other variables are measured at or before the 2008-12 wave of the ACS, and our statistical analysis examines the amount of (positive or negative) change in multifamily units that subsequently occurs within each tract.

The results of the analysis are relatively clear, and strongly suggest that jurisdictional scale matters for housing development. Overall, larger local government population size is associated with a greater increase in multifamily units. For example, we estimate that a tract located in a jurisdiction with a population of 500,000 to 1,000,000 experienced an increase of roughly 46 more multifamily units between time period 1 (2008-2012) and period 2 (2014-2018), relative to an otherwise highly similar tract in a jurisdiction of less than 50,000 residents. Location in the largest jurisdictions – those with populations of at least 1 million – is associated with a smaller increase of roughly 24 units. This nonlinear pattern – i.e., more receptivity to multifamily housing in “pretty big” than in “very big” jurisdictions – is consistent with the notion that the largest jurisdictions engage in quasi-monopolistic control of land use.

It is well known that institutions shape policymaking processes and outcomes, but the role of jurisdictional size has been surprisingly neglected in analysis of metropolitan governance, with empirical attention often divided between the very largest jurisdictions and all others. Our results point to the importance of more nuanced empirical attention to jurisdictional scale as a basic institutional variable. In particular, our results suggest that larger jurisdictions are better for housing production, but that wholesale amalgamation of local governments into megacities or single-tier urban counties may not lead to significantly more housing, due to the issue of quasi-monopoly control of land use.

Read the full UAR article here.

Photo by Matt Donders on Unsplash

Author Biographies

Nicholas J. Marantz is an assistant professor in the Department of Urban Planning & Public Policy at the University of California, Irvine. His research addresses local governance and the regulation of the built environment, particularly as they relate to mobility and housing affordability. His recent research has appeared in outlets including the Journal of the American Planning Association, the Journal of Planning Education & Research, Housing Policy Debate, and the Journal of Urban Affairs.

Paul G. Lewis is an associate professor in the School of Politics and Global Studies at Arizona State University. He is interested in urban policy, local politics, and public attitudes toward policy issues. His recent research has appeared in such outlets as Journal of Public Administration Research and Theory, Journal of the American Planning Association, Journal of Urban Affairs, and Political Behavior.