They know big houses raise values and everyone’s taxes. Real estate people will shrug and say it’s just the free market. State tax assessors shrug and say there is nothing to be done about it. But any real estate dealer knows of the subsidies and tax breaks the real estate industry gets that make it anything but a free market. The tax assessor can’t possibly be unfamiliar with the tax laws that govern what he looks at everyday. Tax laws were made and can be undone.
   The average person is at a loss to explain what is causing housing and retail sprawl. Most people have, by now, driven past a once-familiar piece of land to discover a huge new house there. Some may skip the “why?” and ask who’s paying for such a large house. The fact is, we all are.
   We pay because the tax burden is shifted to those without the million-dollar deductions, while the monster house raises everyone’s taxes. We pay because mall sprawl raises the demands for public services, roads, lights, police, fire, maintenance and therefore the taxes on townspeople. Another expense is having to travel through the uglified landscapes and traffic, knowing that something more important than four cents off on corn chips has been lost forever.
   The cause of what many see as wanton development, is Federal tax policy. It’s a policy that can be traced back at least to the 1920’s. That decade marked the beginning of the age of the automobile. The scale of demand, discovery and production of oil was growing. Commerce Secretary Herbert Hoover encouraged road builders, oil companies, automobile companies and real estate developers to form a lobby. In response, the government established tax policies and programs to boost development.
   Among the many programs to promote growth and real estate development on “raw” land (land that has not been built on is referred to as “greenfields,” typically farmland) are these four:
   • Federal income tax deductions for home interest, points and property taxes, 1920 - present;
   • Federal funding for highways, 1916 - present;
   • Federal Housing Administration – insurance for mortgages to home purchasers, 1934 – present;
   • Federal corporate tax deductions known as “accelerated depreciation” for greenfield commercial real estate, 1954-1986.
   The “mansion subsidy,” as the federal tax law for home interest payments is referred to as it is written, encourages big houses. Taxpayers can deduct mortgage interest and points on a principal of up to $1 million from their income tax every year, and do this on up to two residences. Property taxes can also be deducted. This encourages monster houses. If this deduction were limited to one starter home, the consequences would be far different for most all the other taxpayers and their communities. It would affect local property taxes and federal income taxes.
   Under the accelerated depreciation program, mall builders could depreciate a project in seven years. Americans were not so lusting after “shopping experiences” in the 1950’s that investors responded to that need with malls. Investors lusting after accelerated depreciation found they could lure people out to farmer Johnson’s cornfield and describe all the time they wasted in traffic, parking, wandering through rows of stuff and reversing the process to get home, a shopping experience.
   Soaring real estate taxes, sprawling malls, housing developments, traffic, and demographic shifts are concerns in many parts of the country; some are beyond hope of recovering any of what they have lost. These and philosophical differences over waterfront access are issues on the minds of Mainers. The long history of Maine’s connections with the sea makes this last point the major point for many. Amid the din of development, the recently formed Working Waterfront Coalition has been involved in efforts to help preserve rapidly disappearing waterfront access. This group of citizens, legislators, business people, and anyone interested in finding solutions, is attempting to facilitate working waterfront preservation.
   The coalition is up against some entrenched, powerful forces. The people and corporations which are the beneficiaries, know how the system works, they set it up. There’s a language they and observers use to describe its workings. The average person, on the other hand, sees the sprawl but doesn’t understand it. A Field Guide to Sprawl, by Delores Hayden, is a pictorial dictionary for this language. Hayden is an architect, historian and teacher who has studied and written about the systems that create sprawl and its costs.
   In illustrating the “Mansion Subsidy”, the income tax deduction for interest and points, she describes its costs beyond rising valuations, which include the loss of historic buildings, architecture and scale that fit into the town. Another is tear-downs that can lead to “theming” as the character of the town changes. The Las Vegas version of theming is a hotel built with details to suggest a European city.
   The New England version is “shoppes”, with the same neat fresh paint look, gray shingles/white trim, same style signs, same kind of stuff inside found in the next “themed” town. If you slip on a gob of spilled ice cream and scrape your knee, you’ll have to get back to the parking lot and make the three mile trip out to the Med Mall for a band aid, because practical things are hard to buy in a “themed” town. What about hardware, gas, groceries, or a lawyer for that knee? Those are not in the theme. It’s a mall with no roof, not a town. These “made to look like” towns are more something out of the minds of Hollywood or Rod Serling than reality.
   “Valhalla” is a term used to describe an attractive town chosen by the super-rich as a favorite spot. These towns may not immediately be seen as sprawl, but they attract monster houses- “starter castles” in the language of sprawl- and therefore induce tear-downs. Tear-downs are lots bought for their location. Whatever buildings on it are torn down. Camden, Maine, was chosen by the author and sprawl critic Joel Kotkin, as an example of a Valhalla.
   These patterns of development are, of course, not exclusive to Maine. They are, in fact, coming late to Maine. It’s the last frontier, in some ways, and the momentum behind this industry is daunting. People see the new houses and stores, but the infrastructure of the industry— legal, governmental and financial, is largely invisible to them.
   A more publicized version of a similar and more direct version of public monies used to fund private enterprise, is ball pork. “Pork barrel” is a government project or appropriation, which includes big patronage benefits. When a stadium is built with public funds for the use of a privately-owned team, critics call it “ball pork.”
   Real estate developers with the federal accelerated depreciation and subsidies operate almost risk-free. They can sell out or bail out, dropping a tax bomb on whatever town has taken the bait.
   In the World War II era, a Washington, D.C. lobby called the “Road Gang” became an influential part of the development picture in the U.S. It included oil interests, auto and truck manufacturers, highway engineers and paving contractors. Under their influence, the Federal Highway Administration boosted road building in the 1940’s and 1950’s. This lobby segued easily with the “greenfields” mall and housing developers’ lobbies.
   A fair amount of asphalt has been spread since. A fact that has its own set of critics, who site coastal pollution from pavement runoff, higher temperatures and therefore cooling demands, the obstructed mobility and “wasted motion, time, surroundings and money” of a car culture.1
   The question that inevitably arises from all this — Where does this kind of development end? Can the whole country be covered with malls, highways, housing developments and a handful of gated grand estates for the beneficiaries of it all?
   Federal and state tax policies have supported clearly unsustainable development. Whatever the original intent, the out come has many thinking they have no effective or equitable say in what they ultimately pay for, but don’t want. Attempts to save the last commercial wharf in town need to continue. But major structural changes in tax policy must be made, just to get citizens on the playing field where the bigger picture is played out.
   Some town officials feel forced into shuffling leftovers in an engagement that doesen’t even resemble self determination in the towns where they pay taxes. Shrugs of the real estate dealer and tax appraiser are little consolation. The nineteenth century development booster tax policy should be reviewed.

1Asphalt Nation, J.H. Kay.

A Field Guide to Sprawl,by Delores Hayden, W.W.Norton, 2004, is an aerial photographic study of built enviroments in Amerca. Delores Hayden wrote the text. Jim Wark, aerial photojournalist took the photos. (www.
airphotona.com)