The city of Fredericksburg has 28,000 people and is the fastest growing municipality in the state of Virginia, and it is the hub of a region has over 300,000 people, which is also the fastest growing the state. Nevertheless, many of the city’s residents, especially its downtown residents, insist on thinking of it as a small town. Residents of the old part of the city might possibly be forgiven for mistaking it for a small town; it was a small town for most of its history, and the built environment and residential distribution of the downtown reflect that history. Fredericksburg can often feel like a small town, even if the diminutive old city is really the hub of a large and growing region. The scale of the buildings and the patterns of land usage are village-like, and the relatively minuscule downtown population (compared to the whole area) and its relative isolation from the newer regions of sprawl beyond the interstate make the social experience of downtown Fredericksburg feel decidedly intimate in a small-town way. I get that the “small town character” of Fredericksburg is a large part of its appeal, but the overzealous commitment of downtown’s residents to preserving that “small town character” contributes significantly to Fredericksburg’s extreme income inequality.
See, that’s another thing about the city of Fredericksburg: it is a microcosm of modern America in small-city form because its population suffers from a high degree of income inequality, especially for a city of less than 30,000 people. According to this study from the University of Wisconsin, using data from 2009-2013, the city of Fredericksburg had an income inequality ratio 5.1, mean that the household income of the 80th percentile of the city’s residents is more than five times the income of the 20th percentile. What’s important is that this ratio is much higher than any other place in northern Virginia; no other city or county in the Virginia portion of the DC metro area has a ratio that’s higher than 4.3. That means income inequality is 18.6% worse in Fredericksburg than the next-most unequal jurisdiction (the city of Falls Church), and approximately 25% worse than the average of Northern Virginia. It’s also higher than Virginia’s statewide ratio, which is 4.8. Even if it has “small town character,” the city of Fredericksburg’s income inequality ratio is more typical of a big city than small town America, which typically has a much smaller gap between rich and poor.
A recent line of analysis, most prominently pursued by Matt Yglesias (both online and in print) has demonstrated an important link between income inequality, rising housing prices, and increasingly strict zoning requirements that prevent the development of new housing. Here are a couple of great explainers, as well as a related article by Jon Chait, but the gist is this: the economy generates high-paying jobs in geographically uneven ways. Some places have more high-paying jobs than other places, so workers naturally flock to those places. This in-migration to economically vital regions drives housing costs up, as demand begins to outstrip supply. In a normally functioning market, this imbalance would incentivize developers to build more housing to take advantage of the high prices, leading to increasing supply, leading to an eventual evening out of housing costs. But in many desirable locations, established residents have crafted zoning codes that fit their interests at the expense of newcomers, which generally means preventing increased density because of fears about crowding, parking, shadows, and loss of “feel.” These zoning policies distort the market, making it hard to add new housing and new density, which causes housing prices to spike. This phenomenon is most obvious in big, urban economic powerhouses like New York, San Francisco, and DC, but it is evident in Fredericksburg, too. Just check out the chart to the left. Fredericksburg is more expensive than the US on average; its cost index is 130.5, where the national average is 100. But look at that chart; by far the largest contributor to that high cost of living is the cost of housing, which is 184.2!!! It’s expensive to live in Fredericksburg, and most of that expense is housing. This high cost of housing is a direct contributor to Fredericksburg’s extreme rate of income inequality. There are good jobs here, but poor people can’t afford to live here in order to take advantage of them, and if they do, they end up spending a disproportionate percentage of their income on housing, making them, in the evocative phrase of our generation, “house-poor.”
And here is where we return to Fredericksburg’s fetish for “small town character.” This obsession with thinking of Fredericksburg as a small town, or more precisely, with attempting to keep it a small town, contributes directly to this high cost of housing, which contributes directly to the high cost of living, which contributes directly to Fredericksburg’s extreme degree of income inequality. The city can’t build enough housing to keep up with demand because it has a confusing and overlapping patchwork of zoning requirements and historic designations that slow down new development and prevent increased density, meaning housing supply can’t keep up with demand. More importantly, downtown Fredericksburg has a large and engaged population of residents committed to seeing these codes enforced (and even tightened). The result is a gilded downtown of rich people cheek-by-jowl with poverty, with the middle class largely banished to the outlying counties.
This tendency of Fredericksburg governance and Fredericksburg residents has been on full display in the past couple of weeks. On November 10th, City Council put serious roadblocks in the path of two downtown residential developments that would make significant strides towards increasing downtown’s housing supply. First, it tabled discussion of development Ed Whelan’s Mill District project, which would add 138 new housing units to downtown’s stock, on the site of abandoned industrial buildings and gas stations. Residents in attendance at the meeting were opposed because of the project’s interference with recreation trails, but more tellingly, they were concerned about “bring[ing] too many renters” and “overwhelm[ing] existing neighborhoods.” Both of these concerns are typical of the entrenched interests of existing residents at the expense of newcomers. Increasing the number of renters would be a very good thing for decreasing Fredericksburg’s income inequality, and “overwhelm[ing] existing neighborhoods” precisely the kind of vague concern about “feel” that is a used to keep housing supplies low, housing costs high, and new residents out. Apart from the recreational and environmental concerns about the development, which could be easily fixed in a goodwill negotiation with the developer, this project is unequivocally a good thing for fixing Fredericksburg’s pernicious inequality problem.
I’m not the only one who thinks so; this letter to the editor supports the project as well. But it does so “as an alternative to further residential development in the heart of downtown that some say is destroying our small town character.” To my mind, that’s surrendering the war in order to win the battle. We need to get over Fredericksburg’s “small town character” if we’re going to do anything meaningful about its income inequality.
A second development was derailed at the same meeting, and I’m more ambivalent about the second one. Developer Mike Adams bought the historic National Bank Building, proposing to turn the structure into a restaurant and offices, and to build
8* 7 townhouses on the former bank’s parking lot. The city’s Architectural Review Board approved the project by issuing a “certificate of appropriateness,” but in an unprecedented move the City Council voted to suspend that certificate, stalling the development. It’s far from clear that City Council has the power to take this action, and indeed, the developer is suing the city, arguing essentially that City Council changed the rules in the middle of the game, denying the developer due process. It’s unclear who is in the right, legally speaking, but City Council took this risky step as a direct result of pressure from downtown residents who thought that the development was, you guessed it, out of keeping with Fredericksburg’s “small town character.”
I’m more cautious about the National Bank project than I am about the Mill District project for a couple of reason. First, these townhouses are going to be priced the high six figures or the low seven figures, so they aren’t going to contribute directly or immediately to lowering Fredericksburg’s housing costs. Sure, they increase supply a bit, but such a small and expensive development isn’t going to do much about Fredericksburg’s income inequality, at least not in the short term. Second, the development incorporates a very important historic structure, and as an historian and general old-building buff, I’m obviously highly in favor in treading very, very carefully when increasing density around such a structure. But no one is talking about tearing down anything old; indeed, the developer appears to be promising a sensitive adaptation and reuse of the historic structure … something that is common in downtown Fredericksburg, and which contributes enormously to its appeal. The new stuff is going to be on the parking lot, and the parking lot sure isn’t historic; indeed, big parking lots in the center of old cities like Fredericksburg are an unfortunate 20th century innovation. So replacing the parking lot with housing isn’t going to destroy any history at all, as long as it’s done sensitively. In fact, it’s going to repair Fredericksburg’s historic street fabric, which wouldn’t have had parking lots in it before the 1920s. Done carefully and correctly, this project will make a small contribution to decreasing Fredericksburg’s income inequality and a small contribution to repairing the streetscape of the historic district. I would like to see the city proceed but with caution, which can only be done in cooperation with the developer, not from the other side of a lawsuit.
The city of Fredericksburg is likely to remain Northern Virginia’s most unequal municipality for the foreseeable future, but we won’t began to even make a dent in this inequality if we don’t get over our fetish for “small town character” and realize that we are a city, with urban economic and demographic dynamics at play.
* thanks to Rene Rodriguez for the correction.