Creation Care for Neighborhoods:
The Quest for Bayview Village
Sherman Lewis, PhD.
Copyright 2013 Sherman Lewis Smashwords Edition
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Table of Contents
Preface
The Foundation
Creation care: the evolution of culture and the need for inspirational language
Evolution of thinking
The Whole Economy and Values
Chapter 1 Transportation Pricing Reform: Paying Directly for Driving
Carism
Definition
Specific Transportation Pricing Reforms
12 topics
Involving People in Parking Policy
Mode diversity and the locational decision
The Shuttle
Land-based shuttle finance
Conclusion
Chapter 2 Neighborhood Systems
Density details
Suburbia, a wonderful failure

Six goals for neighborhood systems
Affordablity; Sustainablity; Mobility; Health/Saftey/Security; Design; Community
Low productivity consumption
Smart Growth
Functional density
Grocery Store Trip
Short Corridor Systems
Optimal Building Design
Floor plans
Water and landscaping
Energy
Analysis and assessment
Chapter 3 Going Dense
Old and dense in Europe
New and semi-car free in Europe
Old and dense in America
Relevance for other places
Chapter 4 A Freeway Dies, An Idea Is Born
Early history
7 sections named by dates
2013
Chapter 5 Bayview Village Project Summary
Location Map
Planning Tools
Chapter 6 Project Description
Site, Properties, Conditions
Geotechnical Engineering
Site Plan
Bayview Village Center
Circulation

Parks and Recreation
Acres summary
Grading
Utilities
Engineer’s report
Related Development
Chapter 7 Green Building
Affordability
Unit types and floor plans
Elevation issues
Building costs
Green Building Specifications
Chapter 8 Green Energy
Green Energy Cost
Green Energy Specifications
Chapter 9 Green Water and Landscaping
Chapter 10 Green Mobility
Walking and cycling
The Village Bus
Parking
Car share/rental
Other mobility
Travel time and cost budgets
Chapter 11 Green Jobs and Economy
Chapter 12 Design
Chapter 13 Community
Pets
HOA Services
Chapter 14 Regulation
a. California Environmental Quality Act (CEQA)

b. City of Hayward General Plan and Zoning Ordinance
c. C.3 Provisions
d. Green Building Code
e. Inclusionary Housing Ordinance
f. ADA and Fire Requirements
Chapter 15 Evaluation
Evaluation
Affordability
Sustainability
Mobility
Security, Health, and Safety
Design
Community
Related Evaluation Systems
LEED and Green Point Rated
International Living Future Institute
Litman
Chapter 16 Markets and Marketing
Supply and Demand
Market Research
The Market
Buyer Profiles
Pricing and Comparables
Rent, Lease to Buy, Buy
Buying Energy
Point of Sale Choices
Transitional Parking
Advertising and Buyer Education
Initial Services Implementation
Chapter 17 Financing

Financing
Financing Overview
Financing Details
Other Financial Analyses
Village Bus
Chapter 18 Stages
Chapter 19 Risk Factors
Chapter 20 The LLC Option
The LLC Option
a. Investor accreditation
b. Investors and the LLC
c. The Board of Directors
d. Management
e. Accounting/Reporting
f. LLC Definitions
End Note
Preface
This book aims to move thinking forward on one of the most important places we
take for granted: our neighborhoods.
Bayview Village needs financing. Unless an investor takes it seriously, it is not going
to happen. The Hayward Area Planning Association, which I lead, has been planning
the project for ten years and has spent over a year seeking financing, without success.
HAPA seeks someone to take over the project and work with us to make it happen.
At a few places in this book, I mention what I don’t know––a Beta version comment.
This eBook is a draft for electronic circulation. All this work needs to be made available
now, yet also needs more work. Further, an auction of an important property within the
site is being sold at auction on March 13, and the position of the new owner will be of
major importance for whether Bayview Village succeeds or fails.
I do not have connections to investors or developers. I suspect that the few hundred
parties I have sent information to have not responded because they don’t do anything

close to what HAPA is proposing, their corporate investment policy is not flexible, they
have a short-term, three to five years, time horizon to get their money out, real estate
development is in a major slump, the project is too big for them, the property is not on
the market yet, they are not looking for projects, or, if all that were not enough, the
proposal has very limited parking, only 100 spaces for 1,000 units.
It has been hard to figure out who to ask to invest, given the unusual nature of the
project. Organizations like Smart Growth America, which has some developer
involvement through its LOCUS program, have not helped, and are not set up to help.
Many financial firms invest in existing real estate but not development. Firms that
develop commercial properties don’t do residential. Large residential developers
concentrate on large car-oriented subdivisions; a few are doing smaller condo projects.
Affordable housing agencies depend on tax subsidies and do not do market-oriented
projects. Bayview is much bigger than their usual projects.
HAPA has tried going outside the development investment network to reach other
kinds of investors. Most never answer my email, mail, or calls. Some have told me they
like the project but never invest outside the area they know about. A few say, in effect,
“Go away.” I suspect they may see Bayview Village as just another real estate
development, or think it won’t work because of the lack of parking, if they get that far in
looking at the idea.
I need to do more to get attention, to climb over the wall that seems to make
Bayview invisible to those who should think about it, i.e., green patient investors.
Hence, this book. You will find the project carefully thought out, but that does not
get us all the way there. The crucial ingredient for investors is intuition, that extra
entrepreneurial insight that comes after extensive knowledge.
The plan of the book starts off with a philosophical non-chapter, The Foundation,
discussing creation care, evolution of thinking, and the whole economy and values. For
a summary of the proposal, go to Chapter Five.
Chapters One and Two have policy analysis that lay out the framework for
sustainable neighborhood development. Such development involves six systems and
goals, and how they reinforce each other to achieve the goals of each system:—

affordability, sustainability, alternative mobility, health and security, good design,
and community.
Chapter One covers Transportation Pricing Reform, the biggest missing policy to
create a level playing field in the whole economy. Chapter Two focuses on
neighborhood systems, short corridors, and functional density. Chapter Three covers
existing dense neighborhoods, consisting of certain older European neighborhoods,
newer European car-free neighborhoods, and certain old American neighborhoods.
Chapter Four covers the unusual historical circumstances that stopped an ill-fated
freeway and saved a large property near California State University East Bay in
Hayward (CSUEB Hayward) long enough that it may be possible build a new,
progressive neighborhood system.
The main part of the book starts with a summary of the Bayview Village plan in
Chapter Five, then Chapters Six to Eighteen cover various aspects of the plan. These
chapters should be of interest to those considering investing in the land or the project,
those who are planning a sustainable community and would like specific ideas about
how to do it, and those with an interest in the environment and sustainable cities.
Chapters Six to Eighteen cover a myriad of details on many subjects relating to
Bayview: 6: project description, 7: buildings, 8: energy, 9: water and landscaping, 10:
mobility, 11. jobs and economy, 12: design, 13: community, 14: regulations, 15:
evaluation, 16: markets and marketing, 17: financing, and 18: staging.
The Foundation
While this book is primarily about how to implement a sustainable neighborhood
using a specific example, those ideas result from a framework of supporting ideas. This
introduction covers ideas fundamental to the whole sustainability movement, using three
major topics. Creation Care covers the religious or spiritual basis, the deepest, most
profound feeling and thinking we can do about life and existence in general. This topic is
strenuously avoided by secular academics, but I want to make clear that our eventual
discussion of details springs from the most important issues of our age or any age.
Evolution of thinking discusses how our thinking about how we think has been
revolutionized by scientific discoveries about our brains, the biological basis of culture,

the power of culture to override facts, and how culture frames policy. The whole
economy and values discusses how some cultures value monetized transactions as a
dominant reality, other cultures value non-monetized reality, both sides fail to recognize
the arbitrariness of their values, and the need to integrate both values.
Creation Care
Creation Care is a term used by religious progressives who care about our
stewardship over the earth which God, or some similar source of meaning, created for
our enjoyment and entrusted into our care, with the long term enjoyment depending of
the quality of care. Secular environmentalists and other progressives use a different
kind of language for similar underlying ideas, often creating a gulf between religious and
secular progressives.
The term “creation care” is not used by secular environmentalists, but their term,
“environmentalism,” does not frame the issue in a compelling way. Secularists can be
uninformed about, and uneasy with, “religion,” and often can’t tell the difference
between religious progressives who use science, as opposed to doctrinaire ideologues
who command the attention of a benighted mass media. The media covers the zealots
and not the poets, sectarianism and not spirituality, the conflicts that divide us and not
poetry than can bring us together.
In California, religious progressives have a coalition, California Interfaith Power and
Light: “A group of religious groups that seek to respond to global warming through the
promotion of energy conservation, energy efficiency, and renewable energy.”
() Their leaders:
Let me also introduce Richard Cizik and his New Evangelical Partnership for the
Common Good. He says, [I believe] “that ultimately evangelicals will themselves be
persuaded by the evidence of the argument, and people change their minds. I changed
my mind, and I used to be part of the group of people that are advocating for cutting
Title X funding. I changed my mind because the evidence indicated that I needed to
change my mind.” Title X funds services like Planned Parenthood. Cizik was an early
advocate for creation care, which, for him, is of one piece with science, climate change,
population stabilization, status of women, health care, reproductive services, synergy

among progressive policies, and Christianity. ( />energy/evangelical-leader-says-we-need-family-planning-to-help-fight-climate-change,
Grist, Dec. 10, 2012)
With the human habitability of the earth at stake, how we talk about sustainability
needs to embody its emotional centrality, not just its rational pragmatism, in order to
inspire the deepest motivations of a rising generation with a transforming purpose.
Hence, I use the term creation care to frame the issue in stronger spiritual language.
Framing is important. Poetic language, secular or religious, reaches other people
outside the choir. Poetic language educates and persuades others using words that are
meaningful to them. Too often, environmentalists and secularists use a language of
facts, analysis, and pragmatism that fails to inspire. Lots of facts are, in fact, my
personal predilection, as most of this book will prove. (We can’t all be John Muir.)
The challenges of creation care cover a wide range of policies, a number of which
come together in neighborhoods. Neighborhoods as social places get a lot of attention,
but hardly any attention as systems needing a lot of creation care. This needs to
change. Neighborhoods are the major missing ingredient in the debate on creation care
and sustainability. Changing how neighborhoods work is essential for slowing and
reversing the environmental devastation of the earth, for gross domestic happiness
(also known as the economy), and for social equity.
HAPA is looking for investors who want to invest carefully but also want to make a
difference on one of the most important challenges facing humanity. Bayview Village is
not just about a real estate investment; it is about entrepreneurship.
Evolution of Thinking
Humanity is in a bit of a bind. Our lop-sided skill set is really good at analysis and
tool use, which has allowed us to revolutionize technology. On the other hand, our
brains as evolved to date are not really good at moving beyond tribalism, broadly
defined as the us-versus-them mentality. Tribes here include corporations, nations,
sects, and other reasons for dehumanizing, hating, robbing and killing other people.
This genetic predisposition, which is as natural as cooperation, makes people compete
with each other in “tribal” groups, in ways often devastating to the tribes. Their
competition in today’s world is devastating to nations, and, with atomic weapons,

possibly huge parts of the earth. The path away from nuclear war, climate change, and
other environmental devastation must be to reduce tribalism or, much the same idea, to
expand the tribe.
Tribes in the old-fashioned sense still-exist off in isolated rural and wild areas, are
politically weak, and suffer at the hands of the big tribes, with their nationalisms,
corporate power, agribusiness, mining, ethnic cleansing, mega-capital mega-projects,
and various kinds of oppressive dictatorships. Those little tribes, which are sustainable
by nature, and those of us in the modern world who are trying to get there, are being
overwhelmed.
The thinking styles of our species naturally spread along a spectrum from
doctrinaire ideological thinking concerned with narrow values at one end, to pragmatic,
scientific, tolerant, complicated thinking concerned with many values at the other.
Doctrinaire ideological thinking as used here does not refer to various philosophies of
government, opinions, and values, but to asserting one’s own facts unsupported by the
rules of evidence and science. The Pope once had more power than Galileo, and today
Grover Norquist has more power than pragmatic moderates. Historically, the Age of
Enlightenment did not achieve much in society as a whole. The enlightenment went only
a little bit forward, with too few people and just the start of science.
Ideological thinking is not related to intelligence or information. There seems to be
some period of adolescence and early adulthood when individuals acquire the interests
that shape their careers and social action. Some individuals internalize an ideology of
some kind, grab the information that reinforces their ideas, and ignore the rest, often
with some, if selective, intelligence. Ideologues by nature can out-yell the pragmatists.
Their advocacy can pull the uninformed into their camp along the fault lines of ignorance
and fear in our culture.
In current American culture there seem to be three ideologies creating big
problems: 1) an anti-science, religious fundamentalism intolerant of personal freedom;
2) anti-government feelings, from the Tea Party to Wall Street, opposing regulation
protective of workers, consumers, and the environment, opposing to fair or adequate
taxes, and using magical thinking about fiscal deficits; and 3) neo-conservatism,

proclaiming American exceptionalism, supporting militarism and aggression, and
claiming to advance democracy while advancing American political and corporate
power.
Research by Dan Kahan and others finds that for some personalities, ideological
commitment funnels thinking into highly selective use of facts and non-facts to support a
point of view, with intelligence tending to make the distortions more severe. This focus
on highly selective facts blinds people to the pressing environmental crises taking place
today. Ideologues are more interested their own “facts,” not the facts that will create a
long-term environmental benefit to the community. We do not yet have much useful
scientific understanding of the social and physiological bases for this kind of thinking. (It
also exists on the left.)
Speaking for the pragmatists, we try to understand science. When the vast majority
of hundreds of scientists from all over the world tell us much the same thing for about 20
or 30 years, we tend to believe them. When all the evidence from the earth confirms the
science, we tend to believe it. It is hard for us to deal with the ignorance of the many
and the bias of the ideologues. A few skeptics are jeopardizing the future, not of the
planet, but of its human habitability for their own children. Unfortunately, so far, science
understands the earth better than it understands why we think the way we do about it.
The human genome has inertia and is not going to evolve much, if at all, in a time
frame we can understand. The human historical trajectory, however, has been more
defined by culture than by genes, and that culture is evolving rapidly. The challenge we
face today is to have the quality of social thinking catch up with the advancement of
technological thinking, to reduce extreme ideological thinking, and to enlarge the tribe.
Some of the answer is probably in how we raise our kids before they get to grade
school, because so much of culture has been created by then, in billions of growing and
connecting brain cells, and may relate to some predisposition to later ideological and
tribal thinking vs. pragmatic and empathetic thinking.
While ideological thinking characterizes much of our politics, mainstream culture is
equally important, long on habits and short on knowledge. American culture gets in the
way of achieving the more important American values embodied in Bayview Village.

A prime example is global warming. James Hansen’s testimony to Congress in
violation of White House orders in 1988, the creation of the International Panel on
Climate Change also in 1988, and Al Gore’s Earth in the Balance of 1992 mark a period
when wide spread policy concerns among scientists and environmentalists broke into
the mainstream of policy debate. There is no scientific debate on major issues, but
effective policy has been blocked by vested fossil fuel interests, anti-science ideology,
media complicity, Republican party partisanship, and public ignorance. Forests burn,
droughts get longer, storms increase, the oceans warm, rise, and acidify, and most
Americans still don’t get it. Internationally, given the failure of the Earth Summit in Rio in
2012, things are not getting any better worldwide.
As the political situation deteriorates, the earth does likewise. Most recently, an
article in Nature stated “Localized ecological systems are known to shift abruptly and
irreversibly; from one state to another when they are forced across critical thresholds.
Here we review evidence that the global ecosystem as a whole can react in the same
way and is approaching a planetary critical transition as a result of human influence.”
Human “ ‘forcings’ far exceed, in both rate and magnitude, the forcing evident at the
most recent global scale state shift, the last glacial-interglacial transition.” (David
Roberts, “We’re about to push the Earth over the brink, new study finds,” Grist.org, June
7, 2012, David Perlman, “Close to ‘tipping point’ of warming,” S.F. Chronicle, June 7,
2012)
The scientific consensus is way ahead of the policy consensus, yet often behind
the actual pace of climate change. For the first time in geological history, a species by
its own conscious decisions is ending one epoch, the Holocene, and starting another,
the Anthropocene. It doesn’t look like it’s going to work.
Reinforcing the need to reduce greenhouse gases (GHG) is the ambiguous,
complicated emergence of peak oil. (o/global-peak has excellent
data on the past, less certain projections for the future) The ratcheting upward of oil
prices increases efforts to extract even dirtier oil, to risk the oceans even more, to mine
more coal, and to fracture substrates for relatively cleaner natural gas, none of which
really works long term as well as non-fossil alternatives. Newly and rapidly growing

economies demand more oil, and conventional oil seems likely to have peaked.
Alternative energy like wind, photovoltaic, and thermal are expanding, and energy
efficiency, also known as “nega-watts,” has increasing policy maker, if not popular,
recognition. What is missing is the role of land use, transportation, transportation pricing
reform, and urban systems.
In 2010 the International Energy Association announced that peak oil may have
occurred in 2006. The price of gasoline has been, and is likely to continue to, ratchet up.
Most Americans, they will continue to buy gas as if there were no tomorrow and blame
politics, oil companies, and speculators for a problem inherent in the earth’s crust. The
timing of the action of the ratchet is unpredictable, but it is likely that some price spike
will occur during the build-out of Bayview Village and that it will increase sales.
The most effective policy to reduce GHG would be to put a price on a “bad,” carbon
emission, reflecting its true cost. The carbon tax swap should start at a moderate level,
enough to change markets but not excessively disrupt the economy. The disruption
should not be worse than the disruption now being caused by the lack of a tax swap.
The policy has to be durable enough to affect long-term planning by investors, or, in
other words, strong enough to deter them from using political contributions to try to
reverse the policy. Taxes on “goods,” such as labor (social security taxes and benefits),
should be correspondingly reduced. Government should not try to pick winning
technologies, but pay attention to sectorial impediments to emerging businesses. The
swap level can increase as alternatives take hold. A major result would be to change
neighborhood systems. Economists concerned with climate change and whole economy
productivity support a carbon swap; the average American, not so much, even though
the puts and takes of the swap have no net impact on the family budget.
A carbon swap would affect one of the most important and politically sensitive
prices in the country, gasoline. We don’t just give our cars secure, free places to sleep
at night, close to our own bedrooms; we don’t just use our cars a lot without thinking
about it–––we have a culture of car dependency, car subsidy, and degradation by car.
This kind of thinking, which can be called “carism,” automatically leaps to the conclusion
that something like Bayview Village is against cars. Not so. Bayview accommodates

much car use, yet provides comparable mobility using a fundamentally different
neighborhood system.
Concern for climate change, population growth, peak oil, water, environmental
degradation, sustainability, population, biodiversity, species extinction, oceans,
hazardous chemicals, bioengineering, and healthy life styles is causing some cultural
change, reinforced by higher fossil fuel prices. Important advocacy groups, adding up to
some kind of new environmental movement, are growing. Some remarkable things have
happened in the Netherlands, Denmark, and Germany.
In the US, the Blue Green Alliance ( is bringing
blue collar workers and green environmentalists together to increase the economic
success of reform. Van Jones has started his own group, Rebuild the Dream, as have
Al Gore with The Climate Reality Project and Bill
McKibben with 350.org at These new efforts add to the new
web-based groups like MoveOn.org, older environmental groups like the Sierra Club,
Greenpeace, Ocean Conservancy, Population Connection, and the Democratic wing of
the Democratic Party, all creating a solid base for, hopefully, more political influence.
(More of my musings are at />%20faculty/sherman-lewis-2.pdf.)
The costs extreme ideology and carist culture are already high and are likely to
climb higher. Human thinking so far is not evolving fast enough. The creation care
movement has not yet incorporated neighborhood systems, and needs to. Progressives
focus too much on cars and electricity, and too little understanding of the role of
neighborhood systems.
The Whole Economy and Values
“Whole economy” is a way of measuring the economy using both money and the
things that money doesn’t measure. Better economic analysis can provide a unifying
frame of reference for many problems. Most of the time, when we say we are talking
about the economy, we are really talking only about the money economy. We leave out
social and environmental costs.
The whole economy includes values not monetized in market exchanges, and uses
more than money to measure welfare. The obvious problem is quantification. To get

started, whole economy analysis has to make heroic assumptions, but they are really no
more heroic than money thinking. Money economists make assumptions that they are
generally unwilling to admit or examine, such as using money to measure value. Money
accounting has value judgments; it is not objective. For example, when spending on
insurance and crime go up, the GDP goes up. When a parent stays at home, raising
self-confident, educated, well-behaved, curious children, the GDP does not go up.
Which is more important?
Still, the money economy is a good place to start for defining the whole economy.
Then we need to add in the rest. Already, analyses of nature services, pollution costs,
and cost-benefit have often found interesting ways to quantify some of the whole
economy. Similarly, the Genuine Progress Indicator (GPI) applies puts and takes to
Gross Domestic Product (GDP) to estimate welfare. See
/>Micro-economic analysis and business accounting use an elegant system of income
statements, assets and liabilities, and changes in financial position, but I’ve not seen
this system applied to GDP thinking, let alone asset values based on value judgments
about welfare in the whole economy. An input–output models and other GDP models,
while hugely complex, are not yet good enough. They need to be developed so that
money economists and whole economists can get on the same page, or at least in the
same book.
Value judgments, hidden in GDP thinking, become obvious in whole economy
analysis because non-monetary values must be quantified, necessarily a subjective
process. Understanding the whole economy requires environmental and social values to
be translated into monetary equivalents. There could be two or more versions of the
whole economy reflecting differences in values. For example, those who value
biodiversity and wilderness would give it much more weight than those who don’t. Value
judgments are applied according to science and fact, so climate skeptics and
creationists cannot be part of the debate. Science does not have to be perfect to be the
best referee.
The non-monetary economy needs to be integrated into complex macro-economic
models. Such models will do better than GDP in measuring where we stand, and also

help estimate price changes that could convert some non-monetized values into a price.
They could even test how the market would respond to whole economy prices, shifting
the economy towards real growth by replacing fossil-based, waste-based, and other
systems that cost more than they benefit.
The whole economy can decline while the money economy grows. Sustainability
requires “growth without growth”: there is no reason the money economy cannot
continue to grow in ways that grow the whole economy, while the negatives decline. It is
not a question of reducing consumption, but changing consumption to be sustainable. It
is not a question of the money economy versus the environment, but of integrating the
two. It is not a question of choosing between human needs and the environment, but of
saving the environment that supports humanity, materially and spiritually.
Life in general on earth is not threatened, just human life, which is already seeing
lives lost to environmental degradation. Looming, unknown tipping points of reduced
carrying capacity lie in the future. A tipping point is when an accumulation of small
changes causes a larger system to change even faster. Carrying capacity is how much
life a given ecosystem can support. Sometimes, if that capacity is exceeded, there are
mechanisms, like die-offs of an excessively high population, that can restore a balance,
but also carrying capacity itself can be degraded in ways for which there is no practical
recovery.
We need a Dow Jones for the whole economy. Quantification involves balancing a
value on nature, biodiversity, and wilderness, with a value on the human economy, and
balancing the goods and services of public and private sectors, with a value on social
justice. Similarly, quantitative estimates are needed for judging a range of policies to
achieve our values—education, regulation, services, taxes, and market pricing. Our
ability to make estimates is enhanced by computer modeling, so long as it is continually
trying to reflect the whole economy.
Environmental and social costs need to be quantified, involving the uncomfortable
process of revealing the value we, unconsciously and covertly, place on human life. All
the apples need to be compared with all the oranges, expanding how the money system
does it already.

Let’s take the example of auto dependency to transition to the next chapter. What
whole economy factors could be added to those already monetized? Much has already
been written on this issue, on the underpricing of auto use. Todd Litman’s figure on the
issue has 15 columns of costs, of which only two are paid directly—vehicle ownership
and vehicle operation.

Source: Todd Litman, If Health Matters Integrating Public Health Objectives in Transportation Planning,
Victoria Transport Policy Institute, 26 July 2012, p.24, />The major policy for getting markets to consider non-monetized value is to change
prices, to be discussed Chapter Two, Transportation Pricing Reforms. This topic and
dense neighborhoods are the analytical basis for the details of Bayview Village.
Chapter 1 Transportation Pricing Reform: Paying Directly for
Driving
Car users pay for some of their costs directly, out of pocket, but many, perhaps
most, of their costs, are paid indirectly. The most exact term for this is “indirect pricing,”
but this discussion will use the term “subsidy,” which is not strictly accurate but is more
commonly understood. Cars in the US are subsidized, billions if not trillions of dollars’
worth, in many ways: in prices, wasted time, and non-monetized values
More honest market prices would improve productivity and the economy, reduce
non-monetized costs and thus increase welfare, and change over time the way the
urban system works. An urban system is land use, transportation, and relevant pricing
combined. Land use and transportation are two sides of the same coin, and largely
controlled by transportation pricing. In general, urban systems range from dispersed
auto-dependent systems to dense systems that mostly use non-auto modes.
Transportation Pricing Reform is an essential policy for the gradual conversion of
subsidized, high-cost, low-quality car neighborhoods into low-cost, high-quality, transit
and walking neighborhoods. Transportation Pricing Reform over time would reduce
traffic and parking, speed up transit, and allow redevelopment for social uses, all of
which move a neighborhood toward functional density. Portland and New York City, for
example, seem to have the most willingness to restrict parking in favor of social uses.
The most aggressive parking reduction in Portland is at the micro-scale downtown. New

York City tries to hold parking down for congestion reasons, especially on Manhattan.
Pricing reforms also increase free markets and economic freedom using market
choice rather than government directive. Pricing reform is, then, both a tool to achieve
policy goals and a value in and of itself.
Personal choice, education, and regulation can play a role, but pricing reform is
more important.
If transportation pricing reform were in place, developments like Bayview Village
would be the norm. However, under current pricing, it is still uncertain if Bayview will
even be possible.
Efforts to deal with car dependency range from relatively small but politically
feasible steps to policies that would be effective but are not yet feasible politically.
Transportation Demand Management (TDM) includes a range of small steps and,
sometimes, bigger steps that show what can be accomplished, examples of which will
be mentioned below. The cause of the political problems is the way Americans
understand cars, aka carism.
Carism
A major cultural problem is automobile dependency and the thinking that supports it.
Carism is the ideology that supports auto dependency. Carism is largely unconscious, a
cultural assumption that much car use should be treated as a public good, not a market
good.
Carism is an unspoken part of the fabric of everyday life. American culture stands in
the way of seeing the problem as a whole. We are inured to its many and diverse costs,
and practical alternatives are hard to find. The media generally do not report on costs
already sustained, nor on what can be done. Auto accidents, for example, are just
accidents, not part of a system that needs further change. Too many people see
droughts, floods, and storm damage as human-interest events unconnected with
lifestyle and our economic system.
Pricing reforms go against the grain of American culture of “freeways” and “free
parking.” In theory, Americans favor free enterprise and limited government, but in
practice, for their cars, they support big government, socialism, and “tax and spend.”

Even environmentalists, who lean to regulation more than markets, and businesses,
who claim to support markets, tend to oppose, or be unaware, of pricing reforms. Yet
such reforms remain the most cost-effective solutions to the many costs of car
dependency, oil dependency, and market distortion. The perception that such reforms
have more costs than benefits is directly opposite from the truth. Politically,
Transportation Pricing Reforms are seen as increased costs, while the costs of lack of
reform, and benefits from reform, go unnoticed.
Most transportation professionals understand the efficacy of pricing, yet for political
reasons and to keep their jobs, continue to administer a failed system.
Definition
Transportation Pricing Reform in general means adjusting a monetary price to
reflect its cost to the whole economy and create a market incentive to change behavior
gradually, with no significant economic disruption. Drivers pay more directly for the
costs of their driving; other costs are proportionately reduced, and incentives for
efficiency and welfare are created. “Adjusting a price” should be interpreted broadly; it
can include a tax that affects a price, or reduction of a subsidy, or a time delay for
inefficient vehicles to speed up efficient vehicles.
Pricing reform can be compared to regulation for influencing behavior. Regulation
exists when there is a strong social consensus to sanction certain kinds of behavior.
Other kinds of behavior may be considered undesirable, but lack enough consensus to
be regulated. Undesirable behavior can be reduced by increasing its price, that is,
pricing reform.
Pricing reform is often more difficult than regulation. Pricing reform may involve a
small price, but it affects a large number of people at once, mobilizing hostile opinion
that focuses on the price and not the benefit. Regulation can be easier because it
usually affects a single industry that has been demonized for its pollution or other harm,
and the immediate impact of the regulation is on the industry. The public can pretend
bad guys are being punished and that the cost is not being passed on, but has to be
paid out of profits, that is, by magic. Regulation approximate pricing reform by
encouraging innovation to avoid the harm and competing industries to meet the need.

Government has a hard time raising and lowering a price based on demand, which
comes second nature to business. A government price, like an excise tax, is more likely
imposed to discourage behavior widely perceived as bad or taxable, like smoking and
drinking. Government also has some success with fees for services, but since the
1970s this has not been increased to keep pace with inflation and fuel efficiency. The
gas tax, in fact, seems to have acquired some toxicity for politicians.
Regulation, however, is often less economically efficient than market incentives
created by pricing reform. A reformed price reduces consumption of an item and thus its
external costs; it helps alternatives compete on price, which in turn usually increases
the use of the alternative, improves the alternative, and lowers the price of the
alternative. The new price encourages innovation to find alternatives with lower costs to
the whole economy. Sometimes, regulation can achieve the same result by imposing a
cost on externalities.
Pricing reform is often perceived just as a price increase. Too often, people look
only at the elasticity of a given item, and believe that, if it costs more, it will sell less,
reducing economic activity. Certainly, that is the point of view of a company facing a
regulation or pricing reform. Similarly, some alternative that costs more may also be
seen as an economic loss in the monetary economy. A real understanding requires
quantifying for the whole economy and looking at dual elasticities, that is, at the ability of
an alternative to compete better over time when it is more in demand.
Specific Transportation Pricing Reforms
The many different specific transportation pricing reforms need to be linked as
tightly as possible to the particular cost being internalized. Some studies have lumped
all the costs into a tax on gasoline, but this grossly oversimplifies the complexity of the
situation, and in many cases a gas tax wouldn't work. These subsidies and reforms
tailored for each are discussed here. Then, we will look at some ideas most relevant for
neighborhoods, such as zoning reform, unbundling, shared parking, market parking
charges, mode diversity, and the shuttle and its financing. Grocery store trip, discussed
above, is part of TPR. Grocery store trip is an odd label for a pricing reform, but has to
do with the conditions for functional density to support the walk trip in lieu of driving to a

grocery store. Transportation Pricing Reforms in Bayview Village will be discussed in
more detail under Green Transportation and Mobility. Beta version comment: I did this
research several years ago and have not updated for new data.
The major categories of subsidy, or indirect cost, and reforms tailored to the
problem, are:
1. Environmental externalities
2. Congestion
3. Parking
4. Local government
5. Federal and state government
6. Zoning
7. Market imperfections
8. Fossil Energy
9. Resources
10. Land use
11. Social
12. Economic
1. Environmental externalities
a. Vehicle and road pollutants
i. Air pollution: hydrocarbons (HCs), nitrous oxides (NOx) (HCs and NOx when
cooked by sunlight form ozone [O3] or smog, which damages organic matter), carbon
monoxide (CO), sulfur oxides (SOx), particulate matter (PM10, PM2.5), air toxins.
ii. Stratospheric ozone: chlorofluorocarbons (CFCs), used in car air conditioning
fluid and air bags, escape into the atmosphere, rise into the stratosphere, and catalyze
useful ozone into O2, which allows more ultraviolet radiation to reach the earth’s
surface, causing sunburn and skin cancer.
iii. Global warming/Climate change: CO2, water vapor, CFCs, NOx, and pavement
increase the already significant warming of the earth’s climate.
iv. Water pollution of surface and ground water by cars from tire dust, brake dust,
fluid leakage, oil dumping, and litter. Old lead from before removal from gasoline. Motor

vehicles: Nitrous oxides and zinc from catalytic converters; metal particles and other
toxics from grease, anti-freeze, coolant, other leaking motor fluids; rust particles and
paint particles from auto bodies; rubber, steel, and zinc dust from tire wear; asbestos
from old brake pads, and copper, lead, and zinc dust from brake pad pollute rain water.
Waste motor oil is illegally dumped into storm water inlets.
v. Solid waste: waste tires, batteries, car parts, junked and abandoned cars, and
car-based litter and dumping.
vi. Noise pollution: monetary damage and quality of life costs.
vii. Vibration damage to nearby buildings from ground shaking by traffic, heavier
vehicles in denser areas.
viii. Pavement damage: increased storm water runoff causing soil erosion, local
heat pollution, reduced groundwater recharge, land contamination for future reuse.
b. Externalities by car-related industrial, commercial, and construction
activities supporting car use
i. Vehicle and auto parts manufacture and related mining and transport.
ii. Petroleum industry operations: exploration, extraction, transport (oil spills),
refining.
iii. Auto dealers, auto shops, gas stations (evaporative emissions), and junk yards,
spills and leaks, leaking Underground Storage Tanks.
iv. Road construction and maintenance, sedimentation from construction sites,
water pollution by deicing salts and persistent herbicides (POPs: Persistent Organic
Pollutants) used on rights-of-way.
v. Other road maintenance.
vi. Abandoned land (bases, brown fields) contaminated by vehicles and vehicle
support activities by military, industrial, and other users.
c. Damage from pollution:
i. Damage to human health and mortality, especially to those with respiratory
problems and children, e.g., asthma, those close to heavy traffic, those inside vehicles,
and by the general population on polluted air days. (4.5 percent of health care costs
-Devra Davis, When Smoke Ran Like Water (Basic Books, 2002, p. 103; $55B for US -

Mark Delucchi 1999 in Tamminen p. 250; $3B/year smog costs San Joaquin Valley
-Janet Wilson, “A Valley’s Smog Toll Tallied,” Los Angeles Times, March 30, 2006)
ii. Occupational health and safety issues for oil, auto, road, and other workers and
their families.
iii. Corrosion of building surfaces and materials, e.g. paint, by smog, acidic
deposition, and particulates (grime).
iv. Agriculture: crop damage, lower crops yields from air pollution and global
warming.
v. Forests: forest damage, slower forest growth or forest death, forest fires due to
global warming and ozone.
vi. Aesthetics: visibility.
vii. Wildlife: road kill, direct car impacts through collisions with cars or cars running
over small animals, and fragmenting habitat and facilitating land development also
reducing habitat.
viii. Polluted water damages, cost of water treatment, adverse effect on fish,
recreation.
ix. Reduced water supply due to global warming.
x. Coastal erosion due to global warming.
Many of these costs should be dealt with (and often are) on an ad hoc basis through
improved design, specific regulations, and changes in practices, as appropriate for the
externality.
Carbon tax swap and ratchet
The major idea for most environmental externalities is a tax swap. The swap idea is
to increase taxes on fossil carbons to reflect their real costs, and lower some other tax
to offset the increase and to prevent any windfall gain to government. At the federal
level, the swap could be with some combination of income tax and social security tax. At
the state level, it might be a reduction of the sales tax. The tax on something harmful
would be matched by a reduction on something good, like income or goods. For the
average family, the extra spent on gasoline tax is offset by less spent on the reduced
tax. The only thing that changes is the price incentive to conserve on gas use and have

more for other things. (See details in my “elasticity illustration.”) Those who use more
gasoline than average face a higher net tax unless they change their behavior; those
who use less are rewarded. Most low income persons are rewarded by a lower net tax.
Of major importance is popular expectation of higher gas prices in the long term,
leading to locational decisions which restructure the urban system. The locational
decision merits some discussion of its own, which will come below.
The amount of price change should be strong enough to change behavior at a
moderate pace but not so strong as to disrupt the economy more than business as
usual. The ratchet idea does this; it starts with a low swap level to get the institutions in
place, get some acceptance, and avoid more than average disruption to the economy.
The tax would increase gradually to avoid disruption, like a ratchet. The institutions to
implement the price changes are easy to establish because the sources are easy to
locate: coal mines, oil wells and refineries, and natural gas wells. The swap would
increase to affect the economy moderately, based on elasticities allowing competitive
alternatives to grow. Over time, the swap would reduce carbon emissions and
externalities related to car use to a level proportionate to the increased carbon cost. Car
impacts are correlated with gasoline use, with the exception of a small number of
electric vehicles.
As a result, we can expect most drivers to make many changes. Some are
relatively easy, like changing trips to closer destinations, chaining more trips together
instead of taking separate trips, reducing optional trips, buying more fuel-efficient, less
polluting cars like the new hybrids, and more renting or car-sharing. Lighter weight
materials, more aerodynamic design, and new propulsion based on biofuels, hydrogen,
and fuel cells would reduce carbon emissions. Some changes would take more time,
such as owning fewer cars and changing mode to car pools, transit, walking, and
bicycles.
Restructuring the urban system is not possible in the short run, but over time can
change at about the same pace that created car-dependent suburbia. Workers can