Solving City Budget Mysteries

Concerns this year about the Coronavirus pandemic’s impact on the City of Takoma Park’s operations and residents’ welfare have caused residents to pay greater attention to the budget and budgeting process. Sadly, all this attention has revealed how little most residents understand the budget. Some people have huge misconceptions. Others distrust what they hear from the City. There’s a lot of confusion. And it is not anyone’s fault.

When it comes to the City’s budget, a huge knowledge gap persists between the City Council on the one hand and everyone else who lives in the city.

This is a serious problem that needs to be fixed and no one is doing anything about it. This lack of understanding makes it really difficult for taxpayers to intelligently comment on the budget. Public criticism often misses the target. Well-meaning residents want to make productive contributions to the budget discussions, but if they’re ill informed they get frustrated and feel like their concerns are falling on deaf ears. Councilmembers don’t benefit from the sound opinions they need to get from residents. 

From my own Council experience, I know this to be true. It just isn’t possible to take the time to thoroughly explains things to constituents. No one comes out a winner in this situation. At Council work sessions residents hear a lot of accounting jargon and Councilmembers’ disjointed questions and answers. Listening to Council work sessions that go on into the wee hours of the morning can’t teach us anything. Who can deal with that? No matter how clear the budget document is written, at 200+ pages it intimidates even the most plugged-in citizen.

A 3-Step Solution

My intention is to fix this in a 3-step process.

Step One, I explain the budget in plain English below: why the budget is structured the way it is, how it works; and the external realities that shape our budget. This is cursory overview. I truly wish I had had this information when I joined the Council in 2009. There was no one to teach me. 

Step Two, In order to elevate the dialogue, I recommend that the City set up a series of trainings for residents who want to learn about the budget. Today, there is no way to do that. (There never has been.) Four 2-hour sessions ought to give people a good start. 

Step 3. From those attendees, the City Manager should select five persons to serve on a new Citizens Fiscal Advisory Board. Members, while continuing to learn, will function as interlocutors between the community at large and the City’s Manager and Council. Their job will be to assist the City Manager year-round when needed and to grease the communication skids. 

As interlocutors, Fiscal Advisory Board members’ role will be helping residents to understand the budget process. Psychologically for many it is easier to grasp information in a casual setting from a fellow resident who’s not part of the decision-making apparatus, or part of a public debate.

In the other direction, Advisory Board members will provide early guidance to the City Manager and Councilmembers on things residents are concerned or confused about, and to offer help with solutions. This will be a new avenue to obtain community input. And ultimately it will elevate the dialog around the budget and other fiscal matters.

An existing entity similar in function is the Police Chief’s Advisory Board. I’ve advocated for a fiscal advisory board for years. Other cities do this. There is no reason we can’t. It will fill a huge knowledge gap and make Councilmembers’ jobs easier.

By the way, the City’s budget document is indeed praiseworthy. When I first clambered aboard the City Council in 2009 the first budget I saw was twice as thick and nowhere near as well organized. So things are relative.

Let’s be real. Municipal budgeting is extremely complicated. Believe me, it is hard even for the Mayor and City Councilmembers to decipher all of its components and make sense of it all. You can tell this by some of the clarification questions they ask the City Manager and the Finance Director.

So let’s get down to business.

8 Realities

We have to start with the big picture first. 

1) Divorce your perceptions of a municipal budget from your home finances and your business financial statements. The similarities are scant. But the contrasts can be very helpful to your understanding.

2) In Maryland, municipalities (except Baltimore) are at the bottom end of a food chain.

3) Small municipalities have very little control over their revenues.

4) There is no such thing as a “bottom line,” a profit or a loss. 

5) A business and an organization can fail or voluntarily cease, but a government never has that option. 

6) In local government expenses get paid daily, but revenues come in irregularly.

7) A budget is an educated best-guess plan for the next 12 months. The City rarely spends all the money it budgets for, but it must budget for all expenses as though it will. 

8) The idea of running a government like a business is a false hope.

A side note on terminology — The terms municipality, city and town are synonymous. Different places call themselves different things, like the Village of Chevy Chase, but in Maryland there are no legal distinctions. Either a place is duly incorporated as a municipality or it is not. 

What is Fund Accounting?

Governments use an accounting system call Fund Accounting. Except for the arithmetic, it has almost nothing in common with commercial accounting. Basically it’s a system for tracking income (revenues) the use of which is limited either by the entities that provide the money or by law. The system emphasizes accountability to the taxpayer rather than profitability. 

While a business’s revenue come from one basic source, the sale of products and services, local government’s revenue comes from a multiple sources. They include various taxes, fees, grants, governmental transfers, licenses and permits, penalties, fines, rents and loans. 

Due to these limits, a city must set up various separate accounts called “Funds” to keep it all sorted.

The Speed Camera Fund is an example. Maryland created the program in 2009 to control speeding on state highways only. All the money comes from speed violations. Most of the proceeds benefit the City, but State law requires it to be used solely for “public safety.” This money can’t be mixed with other money.

The City has four major funds: the General Fund, Stormwater Management Fund, Speed Camera Fund and Special Revenue Fund. The latter one is comprised of a number of distinctly funded projects (sub-funds), which the City must keep separate track of. In the draft FY 2020 budget there are 9 of these projects and some, like the Flower Avenue Green Street, have multiple grantors, creating an accounting nightmare. 

The City must account to each grantor that its funds were spent as intended. At the conclusion of a fiscal year, the City reports the ending Fund Balance, which is the net difference between income and expense with each Fund.

Budget Structure 

The budget binder is structured around departments and within departments by functions, which is how the chain of command works. If you want to know about a program, you have to know what department it is in. 

Interestingly, things like Funds, Reserves, Debt and the Capital Budget cut across department boundaries. 

Capital Improvement Program

The C.I.P. section in the budget is a large matrix that looks 5 years forward at how the City expects to spend money on tangible hardware and structural items like streets, buildings, equipment and stormwater. Primary focus is the upcoming fiscal year, which is included in the overall budget. All municipalities use a similar format to plan for the long term. It’s a good way to look at the City’s expenditures down the road. 


The City Council creates individual Reserves. They accomplish several things. Most importsant is to assure the City doesn’t run out of money unexpectedly in case of an unforeseen major financial hit. The City uses the reserve to smooth out financial disruptions and avoid a sudden hike in tax levies. The Equipment Replacement Reserve (“ERR”) is an example. Another reason is to accumulate money for a certain desireable gosls, such as the Housing Reserve.

The City Council decides how to fund a Reserve and how and when to use the monies. Think of a Reserve like a family savings account. In one savings account you put money away for your kid’s college education so the money will be there for the dreaded day you have to write a tuition check. Another savings (i.e., reserve) could be a vacation fund for future trips.

The City has six Reserves. These include the: 

  • General Fund Reserve  
  • Equipment Maintenance Reserve
  • Facilties Maintenance Reserve
  • Emergency Reserve
  • Housing Reserve
  • Restricted Bond Reserve

The City Council controls each of these accounts, except for the Restricted Bond Reserve.

The Reserves are designated as “Unassigned” and “Assigned.” The funds in unassigned reserves, like the General Reserve can be used flexibly without constraint. Control derives from the Council’s discipline in sustaining it. The General Reserve is dipped into when cash runs thin to pay obligations. Payables are regular, but revenues arrive irregularly. So the General Reserve acts like a business line of credit whose balance goes up and down throughout the year. 

Assigned Reserves, like the ERR, have set mandates for how the money can be used. The City charts the longevity of each equipment item. Each year the City Council adds money to the ERR to assure that replacement equipment can be purchased per schedule. The Housing Reserve is a bit open-ended pending the Council’s decision on how to best make use of it.

Bonds and Debt

The Restricted Bond Reserve is a different animal. Money going into it comes from the City’s sale of bonds to finance really expensive projects that have a very long life span — like the Community Center (2005), the Public Works Yard (2010) and for the new library (2018). All of this data can be found in the “Debt Service” section of the budget binder. The City monitors its total debt burden so it stays within manageable proportions. 

The sale of a bond and the use of the proceeds are regulated by the State and federal government in order to protect the bond buyers (investors). The money must be used for its original purpose. Thus the City Council’s control is quite limited.

Revenues – The Cheese Stands Alone

As in any business, estimating future revenues is the hardest part of city budgeting. Doing so is ultimately an educated guessing game. Each year the new budget is built on the experience and outcome of the previous one.

The big problem is that the City has very little control over most of its revenues. Ninety-two percent of its inflows come from three sources: property tax (54%), income tax (13%) and intergovernmental revenues (25%). The City has a real “say” only over the property tax. 

In the song, the Farmer in the Dell, as children we learned that, in the end, the cheese stands alone. The “mouse takes the cheese,” but the cheese doesn’t take anything. Takoma Park is at the end of the line; it doesn’t get any choices.  

In Maryland a city has very limited chances to alter its revenue sources. It cannot create a new tax to raise money. (A county can.) We’re at the mercy of the Governor, the State legislature and the County. (This is where our District-20 Annaoplis delegation is so important.)

Maryland cities rely principally on the property tax for the largest share of their revenue. The State performs the property assessments every three years, and the city determines the tax rate annually. Unfortunately for us, the County and the State also tax real estate, which drives up our tax bills considerably. So even though Takoma Park may hold or lower its rate, the County effectively forces it up. 

It is unlikely property tax receipts will be affected by the pandemic because, first, property values would have to decline (unlikely) and the next assessment won’t happen until 2022. Property tax revenue is not where our City is vulnerable.

Takoma Park automatically receives a flat 17% of the income tax paid by Takoma Park residents to Montgomery County in the preceding year. This amount can vary considerably from year to year as residents’ income varies because of the effects of prosperity, recessions and economic turbulence like the Coronavirus. Income tax revenue receipts come in about 8 times a year due to different tax filings, according to the City Manager. Because this tax revenue is based on calendar year 2019 earnings, FY 2021 income tax revenues won’t be much affected by the pandemic.

Intergovernmental transfers represent more than 15 categories of programs and agreements by which funds come from the County and the State to the City. These infusions tend to be fairly stable year to year. Included our several “in lieu of” (a.k.a. “tax duplication”) grants from the County reimbursing the City for services we provide in lieu of the County. These transfer protocols are set by legislative acts, mutual agreements and political understandings. But the higher government can at any time reduce or terminate at its discretion. This has happened.

Expenses and Deficits?

Some people get terribly confused because the City seems to operate at a deficit some years. In FY 2019 the City had total revenues of $25.7 million and expenses of $27.0 million producing an operating loss of $1.3 million. How can this be? Aren’t local governments required to adopt balanced budgets? Yes they are. 

The City balances its budget by using money from its General Reserve when there is an operating deficit. In such cases the General Reserve shrinks. On the other hand, should major projects get delayed, or jobs become vacant, the city wins a grant or the State legislature increases programming support, then there could be a surplus.

Keep in mind that an adopted budget is just a plan; effectively it’s a best guess of what is likely to happen with revenues and expenses in the coming year. As the fiscal year progresses, adjustments get made; money needs to be shifted among accounts, and this requires the Council’s approval.

Otherwise, in a normal year expenditures are not complicated and are relatively predictable. Since this is not a normal year, the City Council is reducing expenses in favor of conserving cash and waiting to see how things play out pandemic-wise.

No More Mystery

The City’s Budget is complicated. That’s the nature of the beast. Even the brightest of people have difficulty dealing with it because it is unfamiliar. But it doesn’t need to be mysterious and off-putting. We as a city want and need informed participation. But to get that, we have to give folks a fair chance to be able to participate intelligently. The steps I’ve outline here will achieve that.

Nature Versus Society

Once the coronavirus became an obvious serious threat, I found myself struggling to find an historical precedent that could help make sense of the global magnitude and uncertainty of the event. I’m sure I’m not alone in this. It’s pretty natural to seek lessons from the past to guide us and give us heart.

The onset of World War II for America, as it turns out, may be the only comparable time in our national history. The War affected most of the world at the same time. It was probably the last event to do so until this year. So there are lessons to be learned. One thing we know, our society was hugely transformed by the Second World War as was much of the modern world.

That War and the the novel coronavirus have much in common. Let’s look back for a moment to try to imagine ourselves in that time. Then we’ll look to what our future might bring.

In 1941, the war in Europe had already been underway for two years while the U.S. officially remained neutral. Many Americans strongly opposed our entry into war. Folks like Charles Lindbergh and John D. Rockefeller thought Adolf Hitler was pretty cool. Meanwhile Japan was at war in the Far East. Our military leaders knew Japan was planning a major naval attack, but assumed it would be in the Philippines, and thus nothing to worry about. It was common knowledge that Japan lacked the wherewithal to stage an attack on our naval base in Hawaii.

So it was a total surprise when on the morning of December 7, 1941 the Japanese navy made a surprise aerial attack on Pearl Harbor virtually destroying America’s Pacific Fleet in a matter of hours. The shock was staggering. Everyone in America would remember exactly where they were when they heard the news. America wasn’t ready for war. Separated by oceans, America had felt safe and strong in its geographic isolation.

While we know America would win the war, back then absolutely no one could anticipate that outcome. The future was a blank, dark slate. The United States got caught with its pants down. And things would get a lot worse before they got better.

The commonality of today’s Covid-19 virus and America’s entry into WWII is this. Suddenly we were under attack from an enemy we didn’t see coming. No one could believe it. This hadn’t happened before. How could this have happened? What would happen next? Who is to blame? How will we survive?

On the radio the following day, President Franklin Delano Roosevelt spoke the famous words, “. . .  the day will live in infamy.” People listened to the FDR’s voice on the radio (if you owned one) for guidance, leadership and hope. There was no other voice. There were no TVs; only radio, your daily newspaper, some magazines like Life, Look and Time and the MovieTone News at the “picture shows.”

Four days later Germany declared war on the United States. Americans found themselves expecting direct attacks any day by the Germans and Japanese on the U.S. mainland. Air raid sirens and blackouts were routine.

The country’s economy and way of life were turned upside down in the ensuing months and years. Gradually people realized our country would never be the same again. Soldiers, seamen and airmen were shipping off to war with no return dates. Factories were shifted into war matériel. Women took over men’s traditional jobs. The Great Depression became a memory. Domestic goods were rationed: shoes, gasoline, nylons, butter, meat, cooking oil, rubber. People saved tin cans, string, bacon grease and rubber bands.

When Pearl Harbor was attacked I was not born yet, arriving a year later. I grew up during the war and then for years afterwards I heard stories of the experiences and sacrifices people had to make to contribute to the war effort. As a youngster in the 40’s and 50’s these deprivations and sacrifices became a normalized value that was bred into me and everyone else my age. Frugality was paramount. You cleaned your plate. We did not know any different. Almost every family in America had members in the service and many families lost close relatives in the war. Mine did too.

Looking Ahead

Cataclysmic events cause societal and economic changes that otherwise would possibly take a lifetime to emerge or never at all. When the proverbial dust settles the old normal is gone. It’s like Humpty Dumpty.  (Thank God for Mother Goose.) Societies look around for the broken pieces and shards and begin to rebuild, but it will be different. And, most importantly, everybody realizes that things have to be different. Don’t bother with Humpty.

That process has already begun to happen in America, in case you haven’t been paying attention. 

  • As vehicles disappear, around the world reports abound of dramatic drops in nitrous dioxide (NO2), a toxic gas mostly caused by vehicle emissions that harms the lungs of all breathing things especially asthmatics. New York City’s air pollution levels have already dropped 50%. Environmental scientists are calling this an accidental experiment that could never have been intentionally planned and carried out. But, remember the old WWI song lyrics: “How are you going to keep ‘em down on the farm after they’ve seen gay Paree.” Once the urban masses have seen the smog lift, tasted cleaner air and breathed deeply, they are not going to forget this and will be far more eager to protect clean air.
  • Witness a huge irony happening all around us. A truism: Nature is always the winner, eventually, when Society tries to resist it. Global warming is Mother Nature’s way of telling us that Society is screwing up the environment. Now Covid-19 may be helping us push back against global warming. Electric cars are going to part of our lifestyle sooner than we thought. Coal and Oil are on the way out. Could this lead to a big step in combatting climate change? 
  • A barrel of crude oil is selling at $24 today, forty percent of the price at the beginning of this year. This is partly because global demand has shrunk. Oil inventories are overflowing storage capacity. In the U.S., the fracking and refining industries could be gravely wounded. The Covid-19 pandemic may someday be looked back on as the beginning of the end of fossil fuel’s heyday.
  • Our health care system, already well out of control in terms of costs and access, has proven itself woefully inadequate. The pandemic has erased any doubt that millions cannot get the life-saving care they need when they lose their jobs. The practice of medicine, private and public, will have to be reorganized and paid for differently. Universal health care, for many an unattainable dream since the Nixon administration, and for others, a paradigm for rampant socialism, will now be realistically on the table. 
  • The stock market’s gigantic losses beyond anyone’s pessimistic imagination has shivered the timbers of investors, big and small, and possibly made financial planning (i.e., retirement planning) into an oxymoron. The stock market will someday rise again, but who wants to ride the roller coaster where the cars come off the tracks. 
  • A universal basic income (UBI) for certain elements of society will surely get a far more serious look. UBIs have been empirically tested in various forms over the years in different countries and may prove to be a viable path. The fact that in 2020 millions of households live from paycheck to paycheck and possess almost no financial resilience — even when fully employed — tells us that our economic system is fundamentally flawed. Covid-19 has exposed another critical societal divide between the citizens who don’t much need the safety net, and all the rest who find the safety net has gaping holes for them to fall through. Trillions of dollars of emergency legislation to stitch the gaping holes, only goes to prove how bad the situation has become in our country. People need to be able to earn enough to build to live and build a savings cushion. A $7.25 Federal minimum wage is a sharecropper’s allowance.
  • Maybe we have seen the first glimmer of the restoration of a bi-partisan Congress for the first time since Newt Gingrich proselytized the Republican Party’s “Contract for America” in the 1990s. Remember when a Republican dominated Congress under President Obama refused to spend money to expand Obamacare without offsetting cuts in other programs because, Republicans said, our country was “bankrupt.” Now Congress has allocated over two trillion dollars to salvage our economy. Wave bye bye to obsolete ideologies. Gee, whatever happened to the need for a balanced budget?
  • “Government is not the solution to our problem; government is the problem,“ said President Ronald Reagan in his 1981 inaugural address. That has been the mantra of the right for the past 39 years: less government is better government. The right has distrusted and denigrated our national government, alleging waste and inefficiency, and reaching its nadir with Trump’s fantasy about a “deep state.” Now that the almighty free enterprise system is staggering, big business stands at Congress’s doorstep, cup in hand, whining for government handouts. That happened in 2008 but the lesson did not sink in. Here we are again in 2020. Reagan may have been witty and clever, but he was wrong. Covid-19 will undoubtedly change a lot of corporate minds. 
  • Scientists’ credibility has hopefully gotten a giant shot in the arm. Anti-intellectualism, and the accompanying distrust and ridicule for expertise, excellence and genius, has pervaded our country for decades. Now maybe we’ll begin to see that change. Today it’s Dr. Fauci, head of the National Institute of Allergies and Infectious Diseases, who everyone wants to listen to, and not the bloviating President who hasn’t an original idea in his head. 
  • Businesses and educators are fast acclimating to remote work, remote instruction and remote meetings and collaboration. Is there anyone not learning about Google Hang Out, Zoom, Team Meeting and other apps? What does this mean for the future of job commuting, rush hour congestion, office building construction? Maybe we won’t need two more lanes added to the I-495 Beltway. It is time to guarantee broadband connection to every domicile in the U.S., just like water and electricity.
  • As working from home becomes routinely commonplace, sick leave and childcare issues may become far more manageable for certain employees and employers. 
  • Covid-19 is testing the resilience of families, no matter how they may be comprised and whether they live under one roof or are scattered across the globe. It’s fair to hope this pandemic is knitting those we love closer together.
  • Younger folks are naturally stressing over their parents’ and grandparents’ health, calling them, texting and FaceTiming. For many scholastic and college students the big stressors have always been the pressure of exams and project deadlines. Now, maybe not so much as Covid-19 gives new meaning to stress.
  • Marriages are being tested as couples cope with the lockdown and have nowhere to go. Maybe long overdue conversations are happening as we talk over meals, board games, jigsaw puzzles and dirty dishes. Perhaps we are finding better ways to listen to each other as we share existential anxieties, the what-ifs and the need to negotiate alone time amidst the togetherness.
  • Kitchens are being put to use as pizzas and carry-outs lose their luster. Expect the art of baking to rise again, dutch ovens being pulled down from the top shelf, and crock pots simmering soup and stews. With warming temperatures, I wouldn’t be surprised to see a keener interest in vegetable gardens. During WWII these were called Victory Gardens. Our own fresh produce tastes all the better for the labor put into it. We also hear more stories of chicken raising. 
  • Grocery deliveries are in high demand. Chains can’t hire people fast enough to fulfill the deliveries. What goes around comes around, they say. When I was boy there was the milkman, the egg man, the bread man and the Fuller Brush man. The idea of home delivery is not new.  Right now the idea of eggs and milk being delivered to our door seems pretty desirable. 


How do we keep our distance and yet stay emotionally close?

Here is the point where WWII and Covid-19 don’t compare anymore. My friend Erwin pointed out to me that for the first time in world history, all mankind is united in facing a common enemy. Think about it.

This is a time of unification. The human impulse in times of trial is to gather with others and put an arm around someone’s shoulder and squeeze. (I remember on 9/11 hugging the fire chief of Steamboat Springs, Colorado where we were at the time. He was dressed in a very starched white shirt.)

But we can’t do that.

Isolation runs counter to our nature as social beings. It doesn’t feel right because it isn’t. Our emotional wellbeing depends not just in communicating with one another — we can do that easily — but being literally with other people even if we don’t know them. When we visit a library, attend a ballgame, or shop in a store we unconsciously bond to all those around us who are sharing the same experience. If you doubt that, think how it feels to be the only customer in a restaurant or the first person to show up at a party. It feels strange and uncomfortable. 

With proximity we have eye contact, body language and inadvertent physical contact. We wear our public face and match our behavior to the occasion. Being seen in public by others awakens our self-consciousness and triggers spontaneity.

My deepest concern is the loss of community. Community forms a huge part of our identity whether it’s where we worship, our work colleagues, classmates, a circle of friends, a Veterans organization, the places we frequent, the team we root for, the politics we espouse, or the town we call home. 

The pandemic weakens our community as it threatens our lives. The core institutions that structure our lives: schools, colleges, theaters, libraries, museums, sports venues, and the forums for public discourse and protest have suddenly become fragile and tenuous.

Video technology helps sustain work connections and education, but ultimately it is a temporary artifice with limited utility. It is painfully clear video cannot substitute for the efficacy of human propinquity. If you doubt that, try flirting romantically during a Zoom meeting. So, the question becomes how long can this isolation be sustained before we lose social continuity.

Many small business are going to close if the lock down goes beyond another 30 days. This will be tragic. Economists say we are headed for a big recession and sustained unemployment. Government loans will pay bills and wages, but small businesses depend on customers to survive. People in the entertainment world are suffering mightily. 

Most unfortunate is that at a time when we need to rely on our faith to pull us through, churches, synagogues, temples and mosques are sealed off. It is a shame that religious leaders cannot find ways to lead outdoor services in parks or parking lots. Practicing our faith alone is not the same as congregating with others, even if at a distance. Jesus didn’t need a temple to give his sermons.

Regarding our doctors, nurses, and first responders, America after the Second World War treated our warriors as heroes when they came home and honored them in many ways. It’s been 75 years since those victory parades. In 2020 our front line people dealing with Covid-19 daily are risking their lives just as much as the ones who fought on the Pacific islands and on the beaches of Normandy, and who can stand beside our 9/11 World Trade Center heroes.

Thousands of other heroes in America today include our scientists, journalists and reporters and, of course, the cashier at the grocery store. This will be the greatest legacy of our surviving and ending the Covid-19 Pandemic.

I have a feeling that next November 26 for all of us under age 81, Thanksgiving will have a far deeper meaning than it has ever had before.


Growing Up Southern, a Personal Chronicle

When Barack Obama won the election for president in November 2008 and stood along side his wife Michelle waving to supporters in Chicago’s Grant Park, many people voiced a common sentiment that we Americans were now transitioning into a post-racial society. I dearly wanted to believe that, but I knew that it wasn’t true. Although it was a great moment in America’s history, I knew deep down it couldn’t possibly be true. 

Today, it’s become all too obvious, thanks to a President who has accomplished one good thing. As a black neighbor of mine said to me, “At least Trump has gotten all the racists to take their white hoods off.”

My story is neither a sad tale of woe, nor of surmounting adversity. It’s a story of cultural shock that reshaped my values and my conception of Americans both black and white. Looking back over years I realize the experience of growing up in in the Deep South dramatically influenced who I would become as a useful member of society.

A Maryland Yankee in Jim Crow’s Court

       For a big part of my youth, my adolescence basically, I lived in the Deep South. This was in the pre-civil rights era: a time when Jim Crow was still the law of the land. The world I experienced consisted of two societies, where two types of people based on their skin color lived in separate bubbles that were interdependent, but remained distinct, never to meld. Think of the ocean and the sky that touch and interact on each other; the creatures of the sea cannot function in the atmosphere and the creatures of the atmosphere cannot survive under the sea. For anyone who was not a witness to this, it may be impossible to understand the coexistence of two societies that barely touched.

For those who don’t know, Jim Crow was a set a state laws, Supreme Court rulings and federal programs that intentionally discriminated against black people across the nation, particularly in the South. Some of these laws and policies still exist.

In 1955 I was a 12-year old living in a respectable, quiet, middle class section of Baltimore called Homeland.  I attended a public school I could walk to and had lots of friends. One day I was rollerskating with my friends when my parents arrived in our family car. I took off my skates, waved good-bye to my friends and climbed into the back seat. All I knew was that we were heading to a place called Atlanta, Georgia. I didn’t know if I’d ever see my best friends again or that my life would be changed forever. I had no idea of where Atlanta was. I did know that it didn’t snow there, which was an unhappy thought.

Within a few days I was enrolled in an elementary school. The kids teased me about my northern accent and calling me a “Yankee,” a term I was unfamiliar with. They’d ask me to pronounce certain words, and my accent would be met with gales of laughter. I kind of liked being the center of attention. The following year I entered high school as an eight-grader. Again, new territory. Kids were obsessed with Friday night football, pep rallies and cute cheerleaders. You could quickly tell who the “in clique” was. Football games were attended by the thousands at municipal stadiums built just for high school football. 

Singing Dixie

Carving at Stone Mountain near Atlanta of  J Davis, R E Lee, and S Jackson

The red and white Confederate battle flag was frequently waved at pubic events and hung on flag poles in front of public buildings. The Star Spangled Banner was rarely played at public events. Instead, “Dixie”, the Confederacy’s national anthem, was sung with boisterous enthusiasm. It began: 

“Oh, I wish I were in the land of cotton. Old times there are not forgotten. Look away, look away, look away, Dixie Land.” 

Another verse: “I wish I was in Dixie, Hooray! Hooray! In Dixie Land I’ll take my stand to live and die in Dixie. Look away, look away, look away Dixie Land.”

A humorous saying was: “Don’t throw away your Confederate money boys, the South shall rise again.” A joke, of course, but the dream behind it was not.

During these years carving proceeded on the Stone Mountain Confederate Memorial portraying three confederate leaders. The remarkable thing is not its size (covering 3 acres and larger than Mt. Rushmore), but that it stirred only positive thoughts about the glory of the lost Civil War. 

To my young mind, all this felt a little odd but seemed fun. In American history class, teachers taught us about the “War Between The States”, the South’s version of the Civil War. The class studied Charles Beard’s book, “An Economic Interpretation of the Constitution” which barely mentioned slavery as a cause of the War (and was later discredited).

At that age my consciousness of the wider world was growing.


Maids and Yardmen

       In the mid-fifties the dawn of the civil rights era was barely a glimmer. As a rule a white person was unlikely to be acquainted with a black person, much less to become friends. There was no practical way to do so and, in truth, no need to do so. Black people lived in different neighborhoods, attended different schools and churches, and shopped in different stores and used black hospitals. Black professionals had black clients. The only black people I came into contact with were the maid and yard worker my parents hired. They were of a kind of servant caste that performed the meanest of tasks.

From the time Reconstruction collapsed in 1877 to the 1960s, the southern white establishment had honed and perfected Jim Crow into a finely tuned machine, which generated little friction, heat or noise. So thoroughly was Jim Crow instituted that the dividing lines of segregation became invisible and immutable. For most while people, Jim Crow was not part of their consciousness or woke-ness.

In Atlanta, I often heard people assert they weren’t prejudiced at all against Negroes by pointing out that their maid or the children’s nanny was a wonderful person who they trusted, and they also knew others who were polite and respectable.

In 1954 the Brown vs Board of Education decision prompted the City of Baltimore to begin integration of its schools. But not in Georgia, or anywhere else in the South where it was ignored. It was not until late 1961 after my graduation that Northside High School would admit its first black student, and only then on a token basis. 

The terms of “racist,” “racism,” “diversity” and “racial equity”  — common enough today — did not exist. They had no application for one simple reason: because everyone considered segregation of blacks and whites to be normal.

The salient term was “integration”, which meant the mixing of races. Unspoken, but always understood, was that integration was tantamount to miscegenation, a big word for (.. gulp) interracial marriage. Integration implied upsetting a three hundred and fifty year old apple cart. The foundational ethos of the time was that “Negroes know their place” and as long as that did not change, everything would be fine. Atlanta was (and maybe still is) the most cosmopolitan and prosperous city of the Deep South. It was growing fast and civic leaders boasted Atlanta was “too busy to hate.” 

Lester Maddox

But that didn’t work in high school where, if you wanted to fit it (i.e., be accepted) and not draw attention to yourself, you avoided saying Negro. Otherwise you risked accusation of being called a nigger-lover. You had to use the N-word and even worse pejoratives. This was just one of the social pressures to conform. 

It’s important to understand that in those days black people were completely vulnerable to verbal abuse and physical intimidation. There was little practical recourse socially or politically. Black Power had not yet emerged, nor the Black Panther Party.

It’s not like everyone or even necessarily most people were insensitive to the plight of blacks. Ralph McGill, editor of the Atlanta Constitution, wrote incisively on the fallacies of segregation. Atlanta mayors, William Hartsfield and Ivan Allen Jr., were liberal by the standards of the day. But they and business leaders could tolerate segregation and the racial hierarchy as long as the economy boomed. Leaders took satisfaction in social and economic harmony. 

Lester Maddox, an archetype segregationist,owned the Pickrick, a small, popular downtown restaurant near Georgia Tech. Maddox refused to allow blacks to enter his restaurant. When some black college students attempted to enter, Maddox famously passed out axe handles to his customers and threatened to use them against demonstrators. Maddox’s notoriety and his malevolent segregationist stand led him to become lieutenant governor and then governor of Georgia in 1967.


Thus harmony meant sustaining the status quo of Jim Crow laws and the stereotypical ideology that black people were, in some undefined way, inferior. This was not limited to the South.

As I Reflect Back 

I ask myself how did such beliefs become so ingrained and remain unquestioned, even among the highly educated, economically well-off, and people sensitive to justice and social ills. Partly it may be that hardly anyone of either race protested or criticized the Jim Crow system. Neither could they possibly imagine where to start to change things.

Thus, public restrooms and water fountains remained separate and duplicative with ubiquitous signs designated “Whites Only.”  And they surely were not equal in quantity and quality. Restaurant and lodgings were the same. If a regular restaurant chose to serve blacks, those customers would have to use the separate, rear kitchen entrance where there might be kitchen tables. In theaters, blacks sat in the balcony. On buses, blacks had to sit at the rear of a bus or the most rearward available seat, and had to stand up and make way for whites if the bus filled up.


Sometimes a Spark Lights a Fire

       This all began to change when Rosa Parks refused to give up her seat to a white person on a bus in Alabama in 1955, an act of sheer defiance. Martin Luther King Jr. a young PhD baptist minister started to become known for his efforts to test the enforcement of Jim Crow laws. At first, we saw King as a curiosity, then a troublemaker and then, too pushy. I think many people felt like King’s objectives made sense and were worthwhile, but that was the limit of their concern. A buddy of mine opined that King was never satisfied, too impatient and ought to be satisfied with what he had already accomplished.

Georgia law forbade integration of public schools and colleges in the state. Governor Marvin Griffin, a rabid segregationist, said that admittance of blacks would cause him to force the closure of all educational facilities. Despite the forced integration of Little Rock’s Central High School in 1957, we knew Griffin would shut down the schools. My parents shipped me off to a small boarding school of 160 boys in Bell Buckle, Tennessee. It was in the middle of a rural nowhere, far from home, assuring my continuing education. And of course, all white.

When I entered Duke University in 1961, it was a private southern college of no great renown. The campus was completely white except for custodians and cafeteria workers. By the time of my graduation only a handful of blacks had been admitted as undergraduates.

Witnessing Change

       Yet things were changing in Durham, NC, an industrial town and home to Duke and Chesterfield cigarettes. For blacks in the South, Durham was an economic success story with its many successful black-founded companies. Its public schools integrated in 1959 and its city council well before that. I witnessed change. Change brought Dr. King to speak at North Carolina Central College (now a university). NCC and Duke students conducted sit-ins at movie theaters and lunch counters. I watched the Ku Klux Klan militia wearing military uniforms and chrome combat helmets walk through downtown Durham to applause and then proceed to an enormous cross burning at a rally of hooded members led by the Grand Dragon.  

Interviewing black store owners, I wrote a feature article for the campus newspaper, “The Negro In Durham: 1865 to 1960.” Yet, it was not until 1968 and 1969 did Duke students finally begin seriously protesting discrimination and low minority enrollment by forcibly occupying the administration building.

My own liberation did not really occur until I entered grad school at Cornell. The Deep South’s segregated societal bubbles did not exist here. There was student diversity. The campus was rife with protests and movements over the worsening Vietnam War, civil rights, women’s rights, the Black Power movement, the drug culture, the sexual revolution and, most of all, the specter of the draft, which dominated male students’ lives. 

Coming from a sheltered southern lifestyle, all this hit me like a ton of bricks. This was my first opportunity to associate with a black classmate, a fellow from Nigeria. It was like coming into the light. Cornell students’ contentiousness prepared me for what was coming.

Upon graduation in 1967 and marriage, I found my first job with the state planning agency in Trenton, New Jersey. Across the nation, inner city unrest had been brewing the two prior summers. The “Long Hot Summer of ’67” brought the most violent ever protests in more than 150 citie, big and small, places like Detroit, Newark, Plainfield, NJ and Cambridge, MD as black people took to the streets to protest against institutionalized unemployment, slum housing, abusive policing and other pent-up resentments. Blood was spilled. Many died. Fires consumed black communities as authorities called out the National Guard. My new bride, pregnant, and I both found ourselves in the vortex working for agencies trying to cope with the crisis.

July 28, 1967 cover photo

For me, the wonder was that it had not occurred many years before. There was no more pretending about harmony between the races. 


Hostility and Trust

       Two years later found me working for Baltimore City as an organizer and community planner in the city’s most desperate neighborhoods. Dr. King’s murder in 1968 had set off chaos and devastation in certain black communities, instilling fear and uncertainty for all the city’s residents. Meeting with black inner city residents week after week, I was often the only white person in a packed room and facing hostility and skepticism. Things were unpredictable, but I was absolutely where I wanted to be, helping folks in my hometown figure out solutions. Boiled down, my work was foremost about building trust and mutual respect. Some of the most rewarding moments of my life up to that time came from those difficult public meetings. It was transformative for me as I began to see the world through the eyes and souls of ordinary black people who only wanted the same privileges, opportunities and security as whites.

In 2015 the death of Freddie Gray while in police custody brought more unrest to Baltimore. But I knew the people of that working class neighborhood because it’s where I worked 50 years ago. Gray’s death was the cause célèbre, but in the intervening half century the city had done almost nothing to ameliorate the crime and drug problems, the lack of improved housing and business amenities in that part of town.

A Long Way to Go

       America is not a post-racial society. We are not close to shrugging off the legacy of centuries of forced servitude and then Jim Crow. Racism is more subtle than it was 50 years ago, which makes it all the more difficult to overcome. It sometimes takes the form of NIMBY-ism when we hear people speak about the threat to their property values (claims that research has since proven to be false), fears of increased densities, affordable (subsidized) housing and realignment of school zones. For some of us it manifests either in gnawing fears or simple discomfort of people who don’t look like us, like immigrants. I am not immune to this, and maybe no one is. Maybe it goes back to our primal instincts of accepting change.

President Trump has fanned those instincts and built a fire from latent embers of distrust and hatred. When Trump supporters say that Trump “speaks to me about how I feel”, that is why they love him. He appeals to their worst half. 

For me and my wife, we live in Takoma Park, a town that couldn’t have more diverse skin colors (and languages) than if you exploded a bomb in a paint factory. For us, this is “normal,” in fact so much so that when we visit places that are absent people of color, it feels uncomfortable and weird. Ours is a mixed racial family with two black sons-in-law (and their extended families) and our “mixed” grandchildren who we could not be more proud of. 

Let me end with a bit of irony. I only recently learned that all the houses in the quiet, respectable, middle-class Baltimore neighborhood of my childhood, called Homeland, were attached with covenants stipulating that the properties could never be sold to Jews and Negroes. 

This is how racism, prejudices and distrust persist and it is why we have such a long way to go. We must come to grips with why so many Americans of goodwill struggle to deal openly and honestly with racial relations and racial biases. People can change. I did. 


The Problem with Takoma Park’s Rent Control

One of the nice things about living in Takoma Park is that nothing ever really changes. Right? The houses are old and generally well kept. We’ve got a huge old forest canopy that adds graciousness and helps cool our city. Crime has declined steadily for years. Most vacant and boarded houses have been gradually absorbed back into normal occupancy. 

Imagine you have been away for twenty years and just returned. You’d notice the new Community Center, a lot more sidewalks, brighter street lamps, more traffic calming devices, and you’d find that most of the stores have changed. But otherwise, it’s pretty much like you remembered it. 

There’s comfort in that notion. A lot of residents love this city for that reason, including me. Progressive values remain true and so does the City’s political influence as a thought leader on state and municipal policies. 

But physical appearances are one thing. Takoma park faces some serious, but well recognized, issues that may be less visible: steadily rising property taxes and tax assessments, and regular increases in utility and storm water bills that pinch those on fixed incomes; overcrowded schools and  insufficient classrooms; and, of course the worsening traffic around and through Takoma Park. None of this should be news to anyone in our town.

Often going unmentioned, however, is a hugely critical issue: Takoma Park’s rent stabilization ordinance. This is news. Adopted with acclaim in 1981, nearly 40 years ago, it no longer is benefiting our city. In fact, it’s hurting us. In Takoma Park the topic of rent stabilization is treated as sacrosanct. Almost no one, I find, is willing to talk about this problem, at least publicly. And, understandably, why should they? Tenants living in rent control units have got a great bargain. Home owners seem to have little interest in the practical effects of the policy.

Well, landlords want to talk about it and developers do too. But who pays any attention to landlords and developers?

The Good News

First, before going any further, let’s acknowledge that rent control has for decades preserved affordable housing in Takoma Park. It’s said that Takoma Park (almost 18,000 persons) contains the lion’s share of affordable housing in a county of over a million people. Arguably it has enabled much of the city’s ethnic diversity that we are proud of. It’s assured that affordable units have remained affordable as they have turned over. That part is what we do talk about. 

Second, later on we address possible solutions, which may allow us to make rent control work for the better interests of multi-family property owners, developers and the city as a whole.

The Problem

The part we don’t talk about is Takoma Park’s aging rental housing stock. As any homeowner well knows, it costs more and more to keep an old house up. Meanwhile, no replacement or new housing has been built in decades . . .  a longer period than perhaps 90% of the residents have lived in Takoma Park today.

It might help to think of landlords as small business owners who have invested heavily into Takoma Park

In this town, as in many places, the word “landlord” is often used as a pejorative. It’s like if you are a landlord, your motivations are suspect. A stereotype is: “They don’t live here and they’re just in it for the money,” implying “they don’t have a stake in our city.” That characterization is completely wrong.

It might help to think of landlords (multi-family property owners) as small business owners who have invested heavily into Takoma Park. True, landlords are indeed “in it” for the money, but so is every business in town (and so is every household whose breadwinners are “in it” everyday to make a living). The only difference is that landlords make huge investments to acquire or build a multi-family property, which becomes a 365 day a year operation. 

Owning an income property is by any measure a long term, illiquid investment. Thus, in order to protect the investment over the long term, the investor has to keep up regular maintenance, modernize as appropriate and replace things that wear out. He has to allow for lost rents due to vacancies; the cost of evicting tenants who cannot pay; the added expense of repairing tenant-abused units; plus pay for common area maintenance both indoors and on outside grounds maintenance. Rental income has to cover the debt service of his mortgage, property taxes, insurance, license fees, accounting and legal services; the salary and benefits of maintenance and management personnel, water and sewer, gas & electricity, stormwater fees, extermination and refuse collection.

You might be thinking as you read this, “Gosh, there must be an easier way to make a living.”

Explaining Rent Control

In 2017 the City hired a consultant, The Cloudburst Group, to prepare an analysis of feasible housing and economic development strategies. The City Council wanted outside expertise to lay the foundation for developing policies. Cloudburst’s study makes frequent mention of the downside problems associated with rent control, which we cite here. 

Cloudburst erred, however, when it asserted that “because the city is mostly built out, there is little new residential construction” (page 3). That’s not accurate. There are plenty of opportunities for constructing new housing in Takoma Park. Density has very little to do with it as we see in Arlington County and Washington D.C. which are “mostly built out,” yet redevelopment proceeds at a steady space. The real reason has primarily to do with the financial impracticality for a developer to build multifamily housing under a rent control regime.

Rent control has one purpose: to prevent rents from rising too rapidly beyond what the average occupant can afford to pay. To put it differently: to prevent displacement due to rent. Rent control means that an affordable unit remains affordable for the next occupant.

Rent control is a governmental technique to intentionally intervene in the local housing market. The normal supply-demand model for pricing rental housing is discarded in favor of government controlled pricing. While we happily live with the normal supply-demand model for private home purchases and non-residential uses, rental housing sometimes falls victim to government intervention.

About 47% of housing units in the city are rentals. Most of these (60%) are rent-controlled. (Many others are subsidized by the Low Income Housing Tax Credits (LIHTC) and Housing Choice Voucher programs. Only 9% of the rental stock is market rate.) Unfortunately a lot of the rent controlled units are in old buildings. Takoma Park ties allowed rent increases to the annual Consumer Price Index-Urban (CPI-U) for the Washington-Baltimore area. For the current 2019-20 fiscal year the allowed rental increase is 1.6%. Other sample years: in the 2016 FY it was 0.2%; in 2012 = 2.2%; in 2009 = 0.2%. Percentage increases jump up and down with no predictability.

Special provisions allow owners to seek supplemental increases if they have made depreciable capital improvements. This requires submittal of a complex set of documents to justify the application with no certainty of outcome. 

There are 157 municipalities in Maryland and Takoma Park is the only one having rent control. 

During WWII, President Roosevelt established the Office of Price Administration (OPA) to intervene significantly in the nation’s economy so as to conserve desperately needed resources to fight the war. Officially the OPA’s task was “to stabilize prices and rents and prevent unwarranted increases in them; to prevent profiteering, hoarding, and speculation; to assure that defense appropriations were not dissipated by excessive prices,” among other objectives. At war’s end in 1945 most price controls and rationing were ended. New York State and the City of New York have continued rent control, but the respective laws have been modified numerous times including 2019 to make them much more workable for property owners.

The Economic Consequences

Virtually all economists view rent control as unworkable or a bad idea for a lot of reasons as discussed in a recent Washington Post opinion piece by Megan McArdle. []

Primarily rent control greatly discourages the construction of new housing and the upgrading of existing units. Why is that? The answer may be obvious.

Who would open any business if they were not free to set their own prices?

Any real estate developer knows that in order to obtain construction and long term financing, he has to prove his bank that projected rental income will be adequate to pay the mortgage and all the other expenses with a margin to spare. Not just for the first year but for the entire term of the loan. If the developer/landlord can’t be in control of rent charges, he cannot take the risk. That’s common business sense. Who would open any business if they were not free to set their own prices? By the same token, the lender must examine the projected future cash flow (net operating income) for reasonable assurance its loan will be repaid on schedule. A bank cannot, as a rule, support a commercial loan when the borrowers’ income will be constrained by law. The same holds true for significant remodeling.

I don’t think it’s a coincidence that construction of multi-family housing ceased in Takoma Park at about the same time as the rent stabilization ordinance was adopted. No new housing has been built here since the 1970s, except for a handful of infill houses.

Walter Block, a libertarian economist says, 

“One effect of government oversight is to retard investment in residential rental units. As a result, the quantity of apartments for rent will be far smaller than otherwise. And not so amazingly, [this] holds true not only for the case where rent controls are in place, but even where they are only threatened. The mere anticipation of controls is enough to have a chilling effect on such investment.” Block says that other land uses like condos, commercial space, offices, warehouses get built because they are never subject to rent control and no one fears they will be. These land uses have healthy turnover and, he says, “extremely slowly increasing rental rates while residential space suffers from a virtual zero vacancy rate in the controlled sector and skyrocketing prices in the uncontrolled sector.”  [ ]

Studies have shown that when rent control is first adopted, tenants clearly benefit from the reduced rents for a period of years. That stands to reason. However, problems accrue over time. Because market rents rise faster than controlled rents, the growing separation becomes obvious to existing tenants. According to the Cloudburst study (page 3), “the median rent in Takoma Park in 2017 was 22% lower than surrounding areas, and nearly 50% lower than in Montgomery County” as a whole.

Tenants in rent controlled units thus have a bigger and bigger incentive to stay put, if their personal circumstances permit. Those who might otherwise want to relocate choose not to, perhaps realizing they cannot “afford” to move. The net result is that healthy vacancy rates disappear and unit turnover tends to stagnate. Worse, this compounds into another problem. Newcomers wanting to find affordable housing in Takoma Park can’t because of the lack of available vacancies. In 2015-16 vacancy rates in Montgomery County and Takoma Park where 2% and 1%, respectively.

This defeats the original purpose of rent control. What good is it to have cheap rents if you can’t find one to rent?

According to Robert Murphy at the Foundation for Economic Education, 

“There are further, more insidious problems with rent control. With a long line of potential tenants eager to move in at the official ceiling price, landlords do not have much incentive to maintain the building. They don’t need to put on new coats of paint, change the light bulbs in the hallways, keep the elevator in working order, or get out of bed at 5:00 a.m. when a tenant complains that the water heater is busted. Furthermore, if a tenant falls behind on the rent, there is less incentive for the landlord to cut her some slack, because he knows he can replace her right away after eviction.”  (Foundation for Economic Education, “The Case Against Rent Control,” Robert P. Murphy 11/12/14)

We obviously know that as things age they deteriorate, whether it’s living things like oak trees or manmade things. Our old growth tree canopy is disappearing because it’s aging out. Even indomitable white oaks poop out after 150 years. Apartment buildings that were 40 years old in 1981 when rent control took hold are now about 80 years old. For apartment buildings that normally receive above average wear and tear, that’s a much a bigger challenge. Factor in, as well, the expectation of central air conditioning, more stringent life safety laws, ADA standards and energy conservation requirements that did not exist in the 1980s, much less in the 1930s and 1940s when these structures were built. 

The Cloudburst consultants summed it up nicely: “Takoma Park has leverage to control property value increases, through rent stabilization programs, but it creates the risk that new construction, combined with stagnant rental incomes when property values and taxes are rising, would initiate a cycle of disinvestment. Aggressive use of rent stabilization will reduce the interest of developers in building mixed-use, mixed-income projects in Takoma Park.”

The rent stabilization ordinance is not the only thing discouraging redevelopment for more and better housing. One landlord/developer who owns properties both within and outside the city, explains, “The City property tax burden on individual property owners in 50% greater than for similar properties located outside the city.”

Another significant reason applies to the whole county. It is the time it takes for most any development — even retail, office and mixed use projects — to gain Montgomery County’s approval. This is the opinion of experienced developers I’ve spoken to. As one developer told me, this challenging process is causing developers to leave the county. As currently organized, the development review process enables a handful of opponents to stymie the normal process over and over again, even if the objections are insubstantial or misinformed, and even when the great majority of nearby residents support a project. 

Still, it remains important that opponents, no matter how few their numbers, have the opportunity to be listened to. But once opposing views been taken into account and validated, there’s no reason not to speed the process forward. 

Considering Takoma Park’s smallness (2.4 square miles), it is easy for a potential developer to read the tea leaves and decide to look not too far away in order to build housing to avoid dealing with the peculiarities, uncertainties and delays in Takoma Park and Montgomery County. 

We see this, of course, all around Takoma Park. The stark reality includes major projects just inside the D.C. line near the Metro station; surrounding the Prince George’s Plaza Mall, and on New Hampshire Avenue just one block south of Eastern Avenue in D.C.

So How Do We Address the Rent Control Problem?

Just as the problems with our Rent Stabilization Ordinance have emerged over the years, Adjustments to rent control have to be instituted gradually. Outright cancellation is neither called for nor necessary. Abolishing rent control would create chaos for tenants and landlords alike, such as mass dislocations.

A first step would not be to quickly hire an outside consultant. Instead, we have the expertise and experience among many capable landlords in our city. So the city council can appoint a “select” committee or task force comprised of landlords representing both large and small building owners and developers, tenant representatives, and some residents at large. Let that group bring in the outside experts to talk about possible changes and how other jurisdictions do it.

Multiple solutions are at hand. Here are just a few ways to modify rent control:

(1) Consideration of household income limits for tenants. Once a tenant’s annual income exceeds a certain limit, they would have to move out, thereby freeing up a unit. (2) A city-run housing voucher system could provide a subsidy to poorer households so that they could afford a larger inventory of units; (3) rent control can apply to designated units within a building; not necessarily to the entire building.

(4) The City could establish two or three tiers of controlled rents (including outright exemptions) depending on the age of the building, the number of units and the condition of the structure. That makes more sense than superimposing one rate of increase for every rent-controlled building. 

(5) The city could set rent increases for periods of two or three years on a rolling basis so that landlords can plan ahead more easily.

(6) Landlords could receive certain financial benefits from the city for having rent controlled units. This would effectively provide compensation for a “partial taking.” The “taking” is the loss by the landlord of the right to set rents. It’s like eminent domain. But under national laws, a government’s right to take property (for a public good), must be accompanied by compensation. Rent control in Takoma Park does not do this. 

(7)  In order to revive developers’ interest in constructing new housing, the city needs guarantee the developer that rent controls of any sort will not be imposed for a period of, say, twenty to twenty-five years.

(8) For landlords who have performed (or plan to perform) major improvements to their properties, and need to increase rents above the stipulated increase to cover the costs, the paperwork is complex. This burdens city staff to review the work and rent increase justifications. Approval is not always assured. An easier process would benefit both parties and facilitate improvements.

(9) The CPI-U index for setting rent increases could be discarded and replaced by a different method that is more sensitive to Takoma Park. The property assessment process and the County and City tax rates are completely out of the control of landlords and the annual property payment has little to do with a regional CPI index.

There are doubtlessly many other methods that can be researched and considered.


If the City fails to address this issue on a city-wide basis, two outcomes seem probable. Neither is good. First, very little, if any, new rental housing will be built in our city for the foreseeable future. This, notwithstanding the City Council’s earnest desire to encourage construction of affordable housing. The city’s coffers are not big enough to financially incentivize new construction. There might be some sort of special subsidies or agreements worked out for the Recreation Center site that the city owns and can thus control. Otherwise, every prospective developer that is not a non-profit will know that “that dog has fleas.”

Second, at some future point the City may find itself standing alone before the state legislature or a state court, defending its ordinance brought by frustrated landlords who see unfairness in the city’s out-dated rent control mechanism.

On October 16 of this year the City’s Council formally adopted its long-range Housing and Economic Development Strategic Plan. To read it, click here.  The Plan does not dwell on the rent stabilization policies, but the Plan references the importance of dealing with it in its very first “Strategy” on page 5, Objective #1, Strategy A:  “. . . Assess the existing rent stabilization program and consider modifications to enhance its effectiveness.”

This is an important policy statement and bodes well.

Preservation Versus a Parking Lot

A story of how a local government historic preservation commission has run amuck with its power

“Takoma Junction” is an important intersection near the geographic center of the City of Takoma Park. Two of its busiest roads converge here, Carroll Avenue and Ethan Allan Avenue, both designated as State roads. It gets a lot of traffic. The area is part of an historic preservation district designated in the 1990s by Montgomery County. It’s not part of the nearby National Register Historic District. 

The principal “actor” in this story is a 0.6-acre parking lot that the city of Takoma Park acquired in the 1980s and has never known what to do with. (An additional half acre is a steep, tree covered slope at the back of the parking lot.) Lying at the visual center of the Junction, the black swath of asphalt – as small as it is – rather defines the Junction. The lot is usually not very busy. Immediately adjacent is the durable and popular Takoma-Silver Spring Food Co-op, which uses the parking lot with the city’s permission for parking and big truck deliveries to its back door. The Co-op is effectively the anchor tenant for the Junction district. There’s a dozen or so retailers across the street, two auto repair shops (one to be added to the site), a large modern fire station and an isolated park no one uses. As a city councilmember, I once stated the obvious: there is no “there” there, which met with faint boos.

Sadly, around town the Junction is mostly recognized for its 3 traffic signals, perplexing traffic delays and risks to pedestrians. While within an historic district, the parking lot and the adjacent properties on both sides are nevertheless classified as “Non-Contributory” meaning nothing prevents any of the buildings on that block face from being torn down. (So much for historicity.) It makes one wonder why the block of properties was included in the historic district in the first place. They could easily be removed or exempted which would give the city more flexibility. 

After a prior failure to attract a developer many years before, the city decided to try again. The  city wants to give the Junction a sense of place worthy of its name: to provide focus and economic activity to the Junction, strengthen the existing business, and help its tax base. Just as important: to help show future developers that redevelopment is do-able in this town.

Montgomery County, Md., like most major localities, has laws intended to regulate new construction in designated historic districts and to protect the integrity of designated historic buildings. Historic preservation itself has over the past 50 years become a recognized field of professional study. 

To implement its law, Montgomery County created the Historic Preservation Commission (HPC) to review alterations to structures within its designated purview and to prevent bad things from happening to historic buildings and historic districts. HPC’s review is just part of the county’s development approval process; owners and developers know they have to undergo HPC’s review and basically have to comply with its recommendations. For historic property modifications the HPC has the power to deny a permit.

So far, so good. The historic review process gets carried out by 9 “commissioners” appointed by the county executive and approved by the county council and supported by a professional staff. Commissioners don’t get paid and generally convene twice a month. They serve 3-years terms, but can be reappointed without limit, and some have served long time. There should be no doubt they take their volunteer duties seriously.

All of the current members are either architects, planners, historians, preservationists or they espouse an interest in these things. They all happen to be white, too.

As a side note, it helps to understand that historic preservation is about enforcing a standard of aesthetics. The idea that the municipal police power can encompass this rather squishy subject has resulted in many a court case for decades. (But that’s another subject.) At the heart of historic preservationists’ viewpoint are two words: consistency and compatibility, which one hears in every other comment made by the panel or its staff. Something either is consistent (or compatible) with something else, or it isn’t. What do these two words mean in practice? The answer is: it depends. Like obscenity, the commissioners apparently just know it when they see it, or don’t.

As a side note, it helps to understand that historic preservation is about enforcing a standard of aesthetics. The idea that the municipal police power can encompass this rather squishy subject has resulted in many a court case for decades. (But that’s another subject.) At the heart of historic preservationists’ viewpoint are two words: consistency and compatibility, which one hears in every other comment made by the panel or its staff. Something either is consistent (or compatible) with something else, or it isn’t. What do these two words mean in practice? The answer is: it depends. Like obscenity, the commissioners apparently just know it when they see it, or don’t.

A county ordinance does set some boundaries. One criteria for approval of a project is if: “The proposal is necessary in order that the owner of the subject property not be deprived of reasonable use of the property or suffer undue hardship [chapter 24A-8(b)(5)]. Further, “It is not the intent of this chapter to limit new construction, alteration or repairs to any 1 period or architectural style.” [24A-8c]

Unfortunately, the nine commissioners seem to have, or think they have, veritable carte blanche authority to delay or deny the right of a property owner — in this case the City of Takoma Park — to develop its property in complete conformity to the County’s Zoning Code. None of the commissioners are elected. Thus they do not represent anybody other than themselves. The HPC does not have final authority on site plans; that falls to the Planning Board; nor of the organization of the two state highways that comprise the Junction. 

In 2014 the city issued an RFP to find a developer. Back in 2012, the citizen-based Takoma Junction Task Force had issued a lengthy report to the city council with 56 recommendations on possible uses and amenities for the site. Not surprisingly, a number of these were mutually exclusive. Nevertheless, the city council took it to heart and relied on the task force’s report to guide its decision making. City officials, myself included, were dubious any developer would respond to the RFP, but lo, seven did.

That’s when all the fun began. Of course the Co-op clearly has a legitimate stake in the parking lot’s future as it was hoping to expand into it and otherwise fearful of possibly being forced out of business, assurances to the contrary.  

It seems everyone within a quarter mile of the site, not to mention the historic preservation buffs, has been ready to spill blood over the lot’s future for as many reasons as there were opponents, including people actually who preferred the empty lot. There was too little of this or not enough of that. (But, heh, I wanted a public fountain and I lost on that score.) 

The task force said the site should be “transformative,” while others shook with anger over the probable “Bethesda-fication” that would doom Takoma Park’s image. In turn, others trotted out gentrification’s evils and claims of racial inequity. The anti-gentrifiers ignored the fact this horse had left the barn 5 years ago when just down the way “Republic”, as au courant a restaurant as you’ll find in the DC area, opened its doors amidst much applause.

Later that year the city council selected Neighborhood Development Company (NDC), a DC-based, minority owned developer experienced with mixed-use, urban infill projects. For fiscal and site control reasons, we (the council) chose to lease the land for 99 years rather than sell it outright. A formal development agreement and lease were executed in 2016 (now in force) while NDC attended a series of resident-organized listening sessions. Eventually Co-op members gave up their opposition to the awardee and reached an MOU with the NDC. Notwithstanding, a fair number of remaining opponents have rallied in their vehemence and diligence. 

In 2018 NDC began submitting its site plan application to the county for approval and began soliciting commercial tenants.

Experienced developers and their land use attorneys know that the site plan approval process is a bit byzantine. Partly that’s because so many county and state agencies get to have a say. It’s an iterative process requiring patience, good will, creativity and negotiation skills. On the positive side, the back and forth among skilled attorneys, an experienced development team and professional county and city planners can produce great outcomes. The process is a bit like watching eleven football players execute complicated plays requiring constant adjustments. When it works, it’s beautiful. 

On the negative side: even then there’s frustration, setbacks, and costly delays because time is money. In NDC’s case, for example it learned it had to downsize the floor area because its team had misinterpreted the county’s zoning code.

This is how it works in most large urban jurisdictions. Unfortunately lay people (regular residents) rarely know any of this. In Takoma Park itself, there has been, in actual fact, no significant new construction since the 1970s. So peoples’ naiveté and anxiety can be forgiven. There’s been lots of new construction around the Takoma Metro stop, but this all lies in D.C.

The HPC plays its part by conducting “preliminary consultations”, which are really public hearings, where commissioners can hear applicants’ presentations and deal with questions and answers from the applicant and the public. 

Going into the initial “preliminary consultation” (May 21, 2019) HPC had in its hands a copy of NDC’s 38-page Historic Area Work Permit (HAWP) application, which included an extensive narrative, 17 color photos and a set of drawings presented by Colin Greene, Senior Director of Planning for the architectural firm, Streetsense. HPC commissioners also had access to the entire site plan application if they needed it.

[In the following commentary, the names of speakers are missing on the audiotape because the chair often failed to identify the individual speaking]

For its part, HPC staff had prepared in writing a litany of criticisms. At the meeting HPC’s commissioners all endorsed staff’s numerous findings without exception. Among them, the first one sets the tone:

“The overall size, scale, massing, height, and architectural expression of the building are incompatible with the historic district.“  [My comment: Other than that the project looks great.]

“Staff asks that the applicants demonstrate why two elevator/stair towers to the underground parking are required.” [Grocery shoppers use carts. If the one elevator is out, then what?]

The entire building should read as one, no more than two, buildings, [emphasis mine] as staff finds that three to four differentiated architectural expressions are not a successful method for breaking up the facade and achieving compatibility with the surrounding streetscape.” [In the upcoming August hearing this will be reversed.]

But then: “The applicants should consider breaking up the long mass of the building by providing a break. Successful examples include a complete break, resulting in two above grade structures . . .” [Let’s make up our minds.]

“The façade of the building should be pulled back to the south, allowing at least a 12′-15′ of clear sidewalk width. This could also better accommodate outdoor dining or other activities to enliven the street.” [What is the historic precedent for outdoor dining?]

“Any offsite improvements, including the proposed lay-by, must be reviewed and approved by HPC as part of the HAWP.  [In the olden days, 67-foot long, 18-wheel semis hadn’t been invented. So why is this part of the conversation?]

“Any proposed road realignments may be incompatible with and detrimental to the historic district and inconsistent with the Guidelines for new construction/public improvements . . . The location of the roads date to the platting of the subdivision and moving or substantially realigning these roads would have an adverse effect on the historic district.” [Being a state highway, I’d hazard the SHA makes the decision. There’s nothing historic about curbs, gutters and storm drains unless we are discussing Williamsburg or Pompeii.]

For the August 14 hearing, the architects brought with them a complete set of new elevations and floor plans showing two slightly different facade renditions and more open space. Additionally the city resubmitted its 2018 City Council resolution (12 pages) approving NDC’s proposed plan. 

This session turned out to be virtual repeat of the May hearing, nine commissioners awarding a thumbs down. One commissioner (Haines) said the architect’s presentation was “a wasted effort.” 

Streetsense had reduced the parapet height from to 42 to 37 feet, the elevator tower from 45 to 35 feet, eliminating the roof as a possible activity space, the first floor height by 3 feet, lowered the canopies, simplified materials, removed almost all facade adornment and created more open space. 

Oh, never mind. Commissioners still complained the building was just “too big”. It reminded a couple members of a “big box” store. It’s still “too high”. It should be split into two buildings. There’s still not enough public open space. Others doubted the lay-by would work and suggested alternatives be looked at. 

Takoma Park City Manager Suzanne Ludlow, speaking for the city, reminded the commissioners that the city, traffic engineers, designers, the SHA and others had looked at every possible idea for making deliveries in the rear, and stated, “There’s no physical way to do rear loading.” She indicated the truck lay-by amounts to an ordinary loading zone common in urban areas. Meanwhile, she said, the SHA has undertaken an unprecedented “visioning process” with residents to figure out how best to reorganize the intersection and cure the delays and improve safety. She concluded by declaring that after years of study and public discussion, “This is what we want.”

HPC commissioners either did not believe Ms. Ludlow or chose to ignore her comments. In their respective summary remarks various commissioners perseverated in stating the lay-by will not work, will cause the project to fail and must be “looked at” again. One said, “the lay-by is considered a problem by everyone . . . both the commissioners and the public find that it’s not feasible and logistically it’s dangerous, and it’s a problem for the use of the public space.”

This is in fact not the case at all. It is nonsense and reveals a complete misunderstanding of the facts on the ground and little regard for the Co-op’s future existence.

Ms. Burditt recommended the first floor and second floor be reduced by one foot each (as though that would make a remarkable difference), and then said this would allow the roof to be put to good use.

It becomes evident that most, maybe none, of the commissioners has visited the location. For all the importance they place on this project, you’d think they would.

They would see, for example, that most of the nearby houses stand 2 and 1/2 stories tall, putting them at 24 to 28 feet, some are 3 stories. In any case, mature trees that dominate the skyline will tower over the proposed project. They’d notice the dense foliage on the rear slope completely blocks a view of the project from Columbia Avenue (contrary to testimony). A walk along Carroll Avenue would reveal the 55-foot tall fire house in the same block, the 12-story Victory Tower, a 40-foot parapet on the building opposite housing Fair Day’s Play and offices, a 3-story rental property next to it adjacent to more structures with very high parapets. Around the corner on Carroll is the Bank of America with high parapets and then the 10-story Takoma Business Center, the 4-story Willow Street building, the 4-story Masonic Center and 5-story Busboys building.

So what “Takoma Park” are we talking about? There’s no fixed pattern of heights; rather an eclectic mishmash of heights and styles that we’re all accustomed to along the length of Carroll Avenue. The city’s charm and fascination have nothing to do with consistency and compatibility. If you want that, head out to Kentlands.

As for trees, NDC’s site plan application details the size, species, health and proposed disposition of 93 trees on the rear slope of the property. The commissioners had not read this data (a site plan requirement) and instead relied on the biased opinions of two residents about the rear slope, one of whom seeks an impractical pedestrian path up the 30-foot slope.

Another resident, boasting of his expertise, asserted he knew better than the developer that the project could be made significantly smaller and still be profitable. Several expressed the need for more open space for community events, “speeches and dancing”. Yet another used his 3 minutes to present his own sketch for the site, which of course has no legal standing and was clearly out of order. Yet this tidbit was enough to captivate two commissioners who thought it should be given consideration.

In response, Mr. Greene countered the commissioners that it is not a big box store because it will be occupied by a variety of retailers and services.

Seeking some guidance from the commission regarding the HPC’s public space comments, Mr. Greene asked,

“Where [do] the precedent elements or other elements from the historic commission come from in terms of the public space along this part of the district?” 

The HPC chair [presumably] answered, 

“The commission does not rely on precedent. We look at each case individually and we are looking at Takoma Park and Takoma Junction; specifically, how to make this development compatible with that part of Takoma Park. It has been used as public space. There’s a need to break it up. I think one of the things you can do is to look at this other proposal. [See above paragraph] We have not reviewed it, we don’t know how compatible it is, but one of the things that’s clear it that it focuses on providing other ways of having pubic space. And I think traditionally Takoma Park has focused on public space .… We don’t have other examples of like, well, here’s someplace else we have approved and here’s how much public space it has and here’s where it is.”

Mr. Greene asked [in part],

 “So with the comment that it be compatible with Takoma Park, what examples can you point to that we can use as an example of that condition that we can understand . . .”

The chair replied, 

“I think you need to listen to other residents of Takoma Park and what they’ve been saying about the use and the availability of public space.”

So what does this mean? Talking to the residents? That phase is effectively over. 

Why the preoccupation with public space? The Commission has been misled to believe that the parking lot serves as a public space. It is and always has been a daily parking lot prior to which it was a land fill. There’s already a park immediately across the street which sits utterly unused. People could dance there if they need to. Besides, what does open space have to do with this site’s history? This is a commercial development, not a town square which neither the city nor the original citizen task force ever intended it to be.

HPC refuses to provide the architects any practical guidance. Instead they duck behind the word compatibility. That’s like saying we need more beauty or more happiness or more truth. Let’s recall Emerson’s words, “A foolish consistency is the hobgoblin of little minds.” 

Outrageously, the HPC asks the developer to look at the other unqualified proposal, that has no legal standing before the HPC, the county or the city.

The commissioners seem persuaded that the 9 vigorous opponents who testified on August 14 somehow represent the views of a city of 17,000 people, perforce “everyone”. In truth, the project has garnered the broad support of city residents and the local business community.

It does not matter, apparently, that democratically elected city councilmembers spent four years initiating a public selection process to find a qualified developer, reviewing a multitude of alternative site plans, holding countless public hearings, work sessions and listening sessions, approving several resolutions and gaining the developer’s (NDC’s) cooperation to go back to the drawing board again and again to accommodate residents’ and councilmembers’ preferences. It does not matter, apparently, that NDC and the city have executed a legally binding Development Agreement and a long-term lease, which are both now in force; or that the Co-op with its legions of members and the developer have negotiated a working agreement that assures the sustainability of the Co-op before, during and after the project’s construction.

There must be reasonable limits placed on the amount of time the HPC spends on site plans; more discipline in focuings on relevant historical matters, and far less persnickety-ness regarding recommendations and more weight favoring the common good of getting things built. Indeed, it’s hard to get two people to agree on aesthetic matters, much less nine individuals each of whom feels the need to offer his or her considered views. Oddly, the HPC members in this particular case seem to agree on everything. If everyone in a room agrees on everything, I get worried. Is the project design that horrendous?

The Chesapeake Bay Bridge was built in 3½ years; the Empire State Building in 14 months. The Transcontinental Railroad in six years in the 1860s. Construction hasn’t even started at the Takoma Junction. 

The HPC needs to constrain itself to matters related to historical construction. A delivery truck lay-by is not within their province; neither is arguing about a sidewalk’s width regarding outdoor dining (leaving aside whether there will ever be an eatery there); nor is the number of elevators. If the developer wants to waste money on 4 elevators that’s its business. HPC’s job is not to play architect or investor. The HPC needs to mind its own damn business. The commissioners needs to learn the difference between offering unsolicited advice and performing its mission.

At some point, the details do not and never will matter. It’s like a couple arguing over the color of the bedroom curtains. Once the building is built and humming with customers, it will be quickly assimilated into daily experiences. Inevitably, most folks will be hard put to remember what all the fuss was about after a few years. 

Imagine for a moment, it’s 2027 and you’re with friends walking along a sidewalk in the Junction, and one of you looks up at the building and says, “You know I feel really bad that this parapet is 37 feet tall instead of 32 feet; and ya know, it seems like there’s an excess, like, you know, of differentiated architectural expressions along the facade. I am so sad. Let’s not eat here.” 

Not going to happen.

It’s a tiny 0.6 acre plot of land — no bigger than a house lot –  that so many people have loaded up with extraordinary expectations and fears, including the historic preservationists and their preoccupation with perfect compatibility.

It’s time to stop this nonsense. The current project design is good enough. In fact, the city is pretty darn lucky to have found a developer willing to build this project and to hang in there through all the challenges, second-guessing, ill informed remarks and insults. 

Could the current design as presented August 14 be improved? Well, yes of course it could. What then needs to be changed? That depends on who you ask. 


Widening the Beltway: Where’s the Vision and Leadership?

Governor Larry Hogan proposes to widen the Capital Beltway by adding four (4) additional lanes to the Capital Beltway (I-495), and doing the same to I-270 and to the Baltimore-Washington Parkway. The added lanes would all be toll lanes, according to current plans. Mr. Hogan’s $9 billion plan is intended to lessen congestion.

Presumably once and for all.

It is so, so “1950s.” The entire proposal will prove to be a disaster for our region and well beyond. It may succeed in relieving congestion only for a brief few years. The plans, tragically, fly in the face of long acknowledged limitations of widening highways in dense urban areas.

The impact on Takoma Park and other communities inside the Beltway is obvious because every additional vehicle will, at some point, exit onto a major arterial. For us that means New Hampshire Ave, University Blvd and Colesville Rd (Rte 29) inheriting significantly more vehicle miles, thus more congestion.

The expansion will add to air pollution, more stormwater run-off, and contamination of our waterways and the Chesapeake Bay.

Critics have attacked Hogan’s plans because of the destruction of homes and businesses in its path. But that will be the very least of the impacts. 

Making matters worse, the Washington Post on April 20 editorialized in favor of Hogan’s plans, citing statistics that by 2040 “roughly 30,000 more vehicles will be using Maryland’s portion of the highway each day.” This fact, says the Post, is the impetus behind Hogan’s proposal. 

Let me digress here. 30,000 more vehicles? Really? How many is that? It works out to a single lane of cars, bumper to bumper, 114 miles long. That’s just a tad short of the distance from Takoma Park to Rehoboth Beach, Delaware. I’m not kidding.

That’s all the reason we should NOT build more lanes. Who wants those cars?

But, back to the Post’s editorial that naively asserts: “Yes, the new lanes would have to be wedged into the Beltway’s narrow corridor in Maryland, meaning” . . . that along the 20 mile span . . . “as many as 34 homes and 4 businesses could fall victim.” The editors boldly assert, “That’s the stark trade-off: displacement, or inconvenience and diminished quality of life for some homeowners in return for massive improvement — in time saved and stress reduced — for hundreds of thousands of daily commuters. On that cold calculation, Mr. Hogan’s plan makes sense.” Quod erat demonstrandum! 

Alas, the Post is wrong. 

Worse still and inexplciably, the Metropolitan Washington Council of Governments (COG) supports Mr. Hogan’s planned highways. COG’s “Transportation Planning Board” includes the I-495 and I-270 projects in its “Visualize 2045 Plan.” Adopted October 2018, it stands as the National Capital Region Long-Range Transportation Plan. The Board’s seven primary visions include support for Bus Rapid Transit (BRT). Otherwise, it mostly just tinkers with the existing infrastructure. Visualize 2045 gives very little attention to the possibilities of extending rail lines, much less any new rails. Where is the vision and leadership?

The Capital Beltway is currently 8 lanes wide and more at interchanges. So, for a minute close your eyes and try to imagine 12 lanes and, of course, include the space for medians, dividers, shoulders and ramps. Oh, and add into your image the setbacks for sound barriers walls. Now, we have a space wide enough to land a Boeing 747. Imagine that space filled with lines of cars and trucks as far as you can see. 

To get real, drive along the Virginia Beltway through the Tysons area and the interchanges connecting to the Dulles Access Rd, Route 7 and I-66.

Virginia’s I-495 near the Interchange with Route 7
photo by Danya Smith for the Washington Post

Nominally there are 6 lanes in each direction including 2 toll lanes. But in actuality, there are 10 lanes in each direction because of wide shoulders and the many on-off ramps. Toll lanes require doubling the number of on-off ramps. This results in a distance from 300 to 400 feet between the sound barrier walls. You will see the popularly named “Lexus Lanes” for those who can afford the tolls. 

Dynamic tolling is scary. Under federal regulations, the toll price must be high enough such that speeds on express lanes do not fall below certain average speeds such as 45 or 55 mph. As the lanes fill up, traffic slows and this forces the tolls to rise in order to deter drivers. A little snow or a collision on the primary lanes forces drivers to use the Lexus Lanes. The higher the demand, the faster the tolls will climb to levels of $30 and more. 

As long as we add more lanes to ease congestion and make it practical to find parking at the destination, folks will drive and they are apparently willing to pay big bucks to do so. In 2017, rush-hour dynamic tolls were installed on I-66 through Arlington County. A current web site shows average evening rush tolls range between $8 and $10 one way. 

These marvels of highway engineering can be a pleasure to drive when traffic is rolling, but not at rush hour. Let’s also remember that all these vehicles have to exit onto our local roads.

Advocates for the expansion of Maryland’s commuter routes make the age-old argument that more lanes will accommodate more vehicles and thus ease, if not eliminate congestion. In a static world, that would make complete sense. But America’s major metro areas, like the Baltimore-Washington region, show no signs of stagnation.

As a Baltimore resident, I remember in 1971 the new I-95 opened connecting the Baltimore and Washington beltways. I was astonished by four lanes in each directions and the wide spans of bridges crossing over the new highway. And there was no traffic! It felt crazy. I thought about turning pirouettes in my VW bug just for fun. Why would anyone build such a ridiculously wide road? Who would ever use it?

In the old days, paths to DC included Route 1 and the B-W Parkway. The Capital Beltway in Maryland had only been completed in 1964 with mostly 3 lanes, which was generous. No wonder we all became convinced that wide, empty freeways were the future. 

Today, we all know that all the major commuter routes are “hit or miss” depending on the hour, weather, collisions, maintenance work and mysterious things that no one can explain. Certain bottlenecks and complete stoppages are predictable. Maryland’s portion of I-495 can seem like rush hour even at midday. 

Robert Caro’s biography of Robert Moses, possibly the most powerful municipal official in American history, who built most of NYC’s parkways and many of its parks, tunnels and bridges, shows Moses learned the hard way that the faster he built these freeways, the faster they clogged with vehicles. Moses sabotaged mass transit in his obsession with roads, which is why today there is no subway line to JFK Airport.

The truism is that in dense areas, a growing population inevitably nullifies the advantages of added lanes. Let’s face it, Americans instinctively love the advantages of self-mobility, whether it be on our legs, on a bike or a personal automobile.

For example, if one could drive the 5½ miles from Takoma Park to Bethesda (or back) at a reliable 35 mph (= 16 minutes), no one would have proposed the Purple Line. 

Governor Hogan and the Post imagine that adding four lanes to I-270, I-495 and the B-W Parkway will solve congestion once and for all. But it won’t because the region’s population will continue to grow for the foreseeable future. From 1990 until today Montgomery County’s population grew 38% to 1.06 million. The labor force grew 31% to 600,000. Jobs in the county expanded by 21%. Today the percentage of people driving alone to work is 65.3%. That’s just a meager 2.4% less than 1990.

Over the next 25 years, the county’s population is predicted to grow 17% (178,000 folks), Frederick Co. by 31%, Howard Co. by 19% and Anne Arundel Co. to our east by 18.5%. That adds up to almost 400,000 more people in those 4 counties alone. (I think these population projections are too conservative.)

Picture this: 20 years from now toll lanes have been installed, there are now 6 lanes in each direction on the Beltway; 30,000 more cars have been added to the scene; rush hours are worse than ever, especially for those who can’t afford exorbitant tolls. Now what do we do? Does the governor add more lanes?

The answer is we don’t do this. It’s not 2039. We can still make a choice today. The answers lie in rapid speed rail and exclusive bus lanes.

You say we can’t afford this? We cannot afford not to do this. It’s time America grows up and does what Europe, Japan and most industrialized countries have done, which is to bind the large and small cities together in a web of rails in concert with Europe’s well designed autobahns, motorways, autoroutes, autovias and autostradas that knit the nations together.

Here’s a fun factoid:

In Cologne, Germany the Hohenzollern Bridge across the Rhine River carries more than1,200 trains per day. This seems unimaginable to us, but it shouldn’t. I’ve seen this with my own eyes.

We need to have contiguous rapid inter-city rail (not light rail or commuter rail) between Washington and Baltimore (including BWI airport, which has become the busiest airport in the region). There’s none now. Also, we need rapid rail in the Route 50 corridor between Washington and Annapolis, and between Annapolis and Baltimore. The City of Frederick could be tied in via exclusive bus lanes. That means lanes exclusively used by 60-passenger buses so they are not ultimately stuck among cars. 

(Equally important, there needs to be a Potomac River rail crossing connecting Gaithersburg to Dulles and Chantilly – route 28 – in Virginia.)

Tying together the region’s four largest cities by rapid rail and bus transit is the only way to keep 30,000 more cars off our Beltway and to preserve woodlands along the B-W Parkway. The $9 billion Mr. Hogan wants to spend on highway widening should go to seeding the funding for the rail lines.

Governor Hogan thinks $9 billion will cure congestion. We wish! This is a gratuitous estimate. Giant public works at this scale inevitably exceed early estimates. This was the strategy Robert Moses employed: underestimate the projected costs, get the project well underway, announce huge “unforeseen” costs, and explain that it’s too late to stop now. 

Consider that every bridge over these highways will have to be rebuilt. In contrast, rapid rail between the cities can be built in or above the highway r-o-w’s. Or perhaps adjacent to the Amtrak and MARC lines. Few bridges will have to be modified. Destruction of pastures, farmland and homes will be minimized.

The Visualize 2045 report — to its credit — is not sanguine about the future of road congestion:

“Forecasts are mixed regarding future road use. Twenty-five years from now, the average person is expected to drive less than today. But population and employment will grow faster than the highway and transit systems will expand, and the resulting pressure on the system will accelerate congestion and crowding. As a result, some areas of the region will experience a reduction in the average number of jobs accessible by auto within a 45-minute commute.” (page 46)

In the 1950s leaders envisioned the 107-mile Metrorail system that was to be completed in the early 2000s, and it was. Why is there no visionary leadership today? Where are the voices?


A Primer on Takoma Park’s Budget

During my time on the City Council I quickly learned two things about the city’s budget. It is the City Council’s second most important responsibility (after hiring the city manager) and it seemed unfathomably difficult to understand. (This coming from a commercial bank lender.)

If you’re perplexed by the budget document, don’t feel bad. Even councilmembers have a hard time. One reason is that many of us tend to assume the city budget is like our household budget or a business’s profit & loss statement. It’s not.

Residents need to be able to understand the city’s budget if they wish to be effective advocates and hope to influence the City Council and City Manager’s budget priorities. If residents are better versed on the budget, the job of the Mayor and Councilmembers’ job will be far easier. 

Residents have often asked questions like:

  •             How can the city have expenses that exceed revenues?
  •             Why doesn’t the city create a 5-year budget?
  •             What happens to the money saved on projects that don’t get built?
  •             What is the general fund? 
  •             Why can’t money be shared among funds?
  •             What’s the point of large reserves, if we never use them?
  •             What’s the difference between a fund and a reserve?

First, I refer readers to Deputy City Manager Jason Damweber’s superb article in the January 2019 City Newsletter explaining how the executive staff and councilmembers perform this duty. Mr. Damweber’s piece walks us through the 5-month process, including how the public’s preferences are taken into account. Read it here:

This blog is different. It’s about how to read the budget – that is, how to make sense of it. Believe me, there is a rationale to the structure of the budget and the flow of the budget’s funds in practice.  


Fund Accounting            Government agencies, many non-profits and places of worship use what’s called Fund Accounting. Unlike with businesses, there is no such thing as the familiar “bottom line.” Governments do not try to make a profit; instead they provide accountability, constancy and transparency.

Fund Accounting allows the municipality to properly manage funds that come from many different sources each of which requires that the money be used in a specific way. 

An easy example is the Speed Camera Fund that receives over a million dollars each year from fines collected from speeders. By state law this money must be used for “public safety,” and can’t be used for anything else. Other funds include the Stormwater Management Fund, the Special Revenue Fund and the General Fund. More about these later. 

Another way to view Fund Accounting: think of each fund as an independent entity with its own budget. Bundle all these funds together and, voilà, you have a municipal budget.

“Bundle all these funds together and, voilà, you have a municipal budget.”

Revenue Inflows            Takoma Park receives income or revenue from a multiplicity of sources. Some of these are restricted and some aren’t. Most familiar to us are revenues from property taxes. The next largest chunk is a mixed bag of money transfers from the County, the State, and the Feds. This includes income tax and Highway User Revenues, as well as tax duplication money, recreation and police assistance from the County. There are also various fees, fines, service charges, as well as grants from agencies and organizations. Let’s not forget bond sale proceeds. 

Expense Outflows            In contrast most of the City’s expenses and outlays are predictable. Many occur like clockwork, just like household expenses. Nevertheless, in any fiscal year there are always unknowns: staff vacancies, programs and projects that get delayed or take longer than expected, weather events, equipment breakdowns, accidents, legal issues, actions by other governments (e.g., a government shutdown), construction overruns, cost increases for supplies, replacement parts, insurance premiums and so on.

“You can think of the General Fund as a big bathtub with revenues flowing in and expenses draining out simultaneously every day.”

The General Fund            To simplify things a bit, the General Fund is the City’s primary budgeting vehicle for overall operations. It covers all the departments and almost all of their basic functions; all the wages and benefits of everyone who works for the City. You can think of the General Fund as a big bathtub with revenues flowing in and expenses draining out simultaneously every day. The City Manager prepares and presents to the City Council a proposed annual budget that assures that “water” in the tub won’t drain out or get too high and overflow. 

Translated, this involves the big challenge of estimating future revenues that will come to the City in the fiscal year ahead. This includes sustaining the city’s operations while anticipating increased costs (wages increases, health insurance costs, repairs and replacements, new technology and inflation, etc.); accommodating new projects and programs council members and residents want; accommodating new mandates imposed by higher level governments; seeking new cost-saving efficiencies and reallocating staff resources. 

This may come as a surprise, but in truth the City has little control over its revenues, except for regulating property tax rates. The City’s revenues often are either dictated by other levels of government, affected by the economy or influenced by just pure political considerations. 

Reserves            This is where Reserves come in. Reserves are nothing more than a fund’s balance at the end of the budget cycle. The balance represents the unappropriated accumulation of the difference between actual revenues and expenditures, or the water left in the tub when all the year’s revenues and expenditures have been accounted for. If in a fiscal year actual revenues are larger than expenditures, then the reserve balance will become higher, and vice versa. 

Here’s an example. In the proposed FY2017 budget the General Fund was projected to have total revenues of approximately $24,518,000 and projected total expenditures of $27,564,000, resulting in a projected deficiency of $3,046,000.

“Wow,” you say, “that’s not even close to a balanced budget.”  And, by the way, Maryland law mandates a balance budget.

Actually, the deficiency is made up by pulling in money from the Reserves also known as the “Fund Balance;” namely unspent, accumulated cash in the General Fund.  In this example, the proposed “Fund Balance” would drop from $11,320,000 to $8,273,000.  The City Manager probably explained to the Council that the Fund Balance was unnecessarily high, perhaps because a major project was delayed or there were position vacancies for part of a year, and thus we could use some of that money in lieu of raising the tax rate.

Think of the City’s Fund Balance as you would your family’s savings account. Most of the time you live out of your checking account. But if income is too low or there are unexpected expenses, you take money out of your savings account. The opposite happens when times are fat.

How High the Reserves            The State requires municipalities to maintain reserves at a certain level. There are also “best practices” among municipalities. Common sense takes over from there.  A big factor for any city is that it must pay routine bills and obligations every week, like salaries and utilities.  But revenues come in irregularly, such as income tax property tax receipts and intergovernmental transfers.  

“The Fund Balance is also there for really bad times when there is a fiscal or economic crisis as happened in FY’10 to ‘14, or some sort of calamity occurs.”

Therefore, the Reserves supply the cash when expenses exceed revenues. The Reserves can fluctuate a good bit throughout the year.  Effectively the City has its own bank line of credit with itself.

The Fund Balance is also there for really bad times when there is a fiscal or economic crisis as happened in FY’10 to ‘14, or some sort of calamity occurs. The Great Recession caused revenue growth to almost stall. General Fund balances were drawn down for three years in a row from 2010 to 2012. In 2010 Takoma Park was forced to eliminate eight positions to make ends meet. 

On the upside, a decent-sized General Fund Balance makes it easier for the City to borrow money from a bank or via a bond issuance. Takoma Park doesn’t have a bond rating because we are too small, but our creditworthiness helps us when Maryland issues bonds on our behalf, as was the case when we borrowed money for the planned Library renovations and major street projects. 

Other Funds                        We mentioned the Speed Camera Fund. There are some other funds, like the Stormwater Management Fund and the Special Revenue Fund.  The City is responsible for managing its stormwater system that includes the above ground drains and collection areas as well as the entire underground pipe system.  Annual fees from each property owner finance this fund.

The Special Revenue Fund gets revenue from cable companies through franchise agreements, the federal CDBG program, the WSSC and Safe Routes to School. Each of these sources stipulates restrictions on how the monies can be spent. Yet another fund is the Facilities Construction Fund, which helps the City to monitor monies received and earmarked for the construction of the city’s facilities. For example, monies gained from the sale of bonds for constructing the Library expansion must be segregated and only used for that project. Money for the renovation of the police department might come directly out of the General Fund.

“Congress refuses to appropriate the money Trump wants to build a wall and so he’s trying . . . to grab money out of other agencies’ budgets. He cannot legally to do that because Congress approved money for specific purposes”

Affordable Housing Reserve            Sometimes the Council creates “special” reserve accounts, which are entirely different than the fund balance in the General Fund or any other fund.  A big difference between “funds” and “special reserve accounts” is that the former contains money from outside agencies and grantors; whereas special reserve accounts are simply set-asides of city monies that are already in the General Fund. 

In 2016 the City Council adopted a plan to create an “affordable housing reserve.” It is not a fund in itself. But rather a commitment, adopted by council resolution, to dedicate a set-aside to be used exclusively for facilitating affordable housing. In 2018 the Council resolved to dedicate all rents earned from the 99-year ground lease with the Neighborhood Development Company to this reserve. Unlike most budget authorizations this reserve is designed to be added to and carried over from year to year while expenditures are made at Council’s discretion. 

Facilities Maintenance and the Equipment Replacement Reserves          These are two other similarly constructed reserves, which the Council finances annually. These two reserves maintain balances from year to year and are intended to assure there’s adequate money set aside to pay for maintaining and repairing city buildings and replacing equipment when needed. 

Capital Budgeting            We conclude by describing the unique Capital Budget. It is part of the overall General Fund, but addresses the need for financing multi-year public facility projects. This could include sidewalk construction, street repaving, facility renovations as well as the purchase of long-term assets such as trucks, police vehicles and other heavy machinery and equipment. 

The capital budget covers 5 years, with the first year being the upcoming fiscal year. Why 5 years? Because the City knows the life expectancy of existing facilities and equipment including what will need to be replaced and when.  Also, because 5 years is standard throughout the U.S. (In fact, the Equipment Reserve plans as far as 8 years ahead.)  In the case of building construction (like our Library) the planning and design phase may take a few years and the construction will take a year or more. 

Common sense says the City has to commit years in advance to provide for the needed monies to build projects and to replace worn out equipment. It can’t be done on an annual basis like routine operating expenses because the hit on the budget would be too big. If money for a project comes from special sources like grants, then these monies may go into the Facilities Construction Fund where they can be carefully accounted for.  An example is the Flower Avenue Green Street project, which has six or seven grant sources that must be used for this project.[ The DPW and the Dept of Finance have to account to each funding source that their money was spent and how it was spent. 

Does this ring a bell?            Compare this to President Trump’s attempt to find money to build a wall on the Southern Border. Congress refuses to appropriate the money Trump wants and so the President is trying, willy-nilly, to grab money out of other agencies’ budgets. He cannot legally to do that because Congress approved money for specific agencies and purposes. 

In Maryland, the General Assembly approved casino revenues to go for school construction. It really hasn’t, and so some Assembly members want to constrain the governor to use casino receipts for schools and not be shifted to something else. Do we see a Casino Receipts Fund in Maryland’s future?

“Democracy means government by discussion, but it is only effective if you can stop people talking.” –  Clement Atlee, British Prime Minister

Greater Takoma Business Alliance

Last September, the Takoma Park City Council held a work session on the idea for establishing differing, higher property tax rates for commercially zoned real estate. The idea was prompted by the City Council’s prior decision to abolish, once and for all, the city’s tax on business’s inventory, which was cumbersome, unfair and unenforceable. Abolishing the inventory tax, a boon to certain retailers, is estimated to cost the City’s treasury about $320,000 in annual revenue. The City naturally wants to recover these loses by some other means. Thus, the intriguing idea of a slight increase on commercial property tax rates arose as a way to make up the difference, which also would have the side benefit of not affecting residential tax rates. 

As councilmembers and city staff batted the pros and cons back and forth, which is what a “work session” is intended to accomplish, a question arose about the necessity of asking the commercial property owners — those who’d be affected — if they would support a differential tax rate and, if so, how much of a difference might they tolerate. 

Well, someone said (I am paraphrasing), we need to ask them. Someone else asked, who are they and how do we do this? 

Sitting in the audience, when I heard this, I chuckled to myself: Who indeed are they! Staff appropriately responded they would work on it. It occurred to me that no one who runs this town really knows who owns what when it comes to non-residential property. Yes, we have anecdotal information. From my experience, I know this information is often difficult to find out because most income-producing properties are owned by LLCs rather than individuals. 

I also know there’s no one who can legitimately speak for all the landlords, whether commercial or multi-family property owners in the City. No one. Sure, we may know the owners of many of the small businesses in town, but almost none of them own the real estate they occupy.

Much of Takoma Park’s identity; that is, it’s “sense of place” derives from its business districts, especially to visitors.

⏤__⏤ __ ⏤__ ⏤__ ⏤__ ⏤__ ⏤ 

The City has hired the long awaited new Economic Development Manager. She will be introduced to us soon. The City has created a new economic development operating division within its Department of Housing & Community Development. The Council previously approved this action as part of the current city budget.

Undoubtedly, the addition of a new position will enable certain internal duties to be shifted. Of great importance, the staff’s professional capacity will be notably expanded.

So What Does All This Mean?

First it means that for the first time in its history, the City can give full-time focus to stimulating business growth, the construction of affordable housing, the activation of Sector Plans and Concept Plans along New Hampshire Avenue and in Long Branch, and facilitating the redevelopment of various obsolete commercial properties.

Equally important, it means that Takoma Park’s business community can now have a place “at the table” on any issues affecting business and property owners and the direction of our economy. 

Much of Takoma Park’s identity; that is, it’s “sense of place” derives from its business districts, especially to visitors. The “Old Town” area attracts shoppers and diners from a wide area. It projects an enviable, appealing shopper-friendly ambiance. The New Hampshire corridor does not. Yet, it is bustling and vibrant, providing a huge piece of Takoma Park’s tax base and it offers an even bigger (perhaps gigantic) as-yet unrealized economic potential. 

A 2017 State of Maryland study of the economic potential of the N.H. corridor found that full development of the developable parcels could increase assessed values (as of 2017) from $2.13 million per acre to $18.57 million per acre. This would be an order of magnitude increase in assessable values of more than 8 times. This would increase City revenues by more than $2 million annually. Keep in mind, each new dollar allows a reduction in the tax rate. The study also shows that added jobs could number into multiple thousands depending on the kind of businesses.

Ironically, despite these facts, business community members — those people behind these businesses are virtually invisible to us. They are largely unknown to the City Council and the people who run our city. And this is nobody’s fault. 

This would be an order of magnitude increase in assessable values of more than 8 times. This would increase City revenues by more than $2 million annually. 

So if we are going to do economic development well in Takoma Park, we need the business community to organize itself. They need to make themselves knowable and and make their voices heard. Based on conversations with business owners we are calling it the Greater Takoma Business Alliance

The business community comprises owners of the multi-family properties in the city, owners of the shopping centers and office buildings, and all the small business owners. All have one thing in common owners make their living, literally, in and from Takoma Park. Each of them has invested in our city.

Business people, whether a landlord of an 8-unit apartment building or an owner of a nail salon, are affected by city laws and regulations, but also benefit from the pubic services Takoma Park provides.

Thus, if we are going to undertake economic development, doesn’t it make sense to involve the business community in this process? They stand to lose or gain as much as anyone. And, they have knowledge, experience and ideas to offer. They can and need to be partners with the City.

What Characterizes Economic Development? 

As a genre, Economic Development has many permutations that vary considerably among communities across America and even just in Maryland. These permutations can be boiled down to four: 1) increasing the assessable property tax base, 2) increasing sales revenues of businesses, 3) attracting / preserving businesses and 4) job growth, which is not an area of concern. Under these rubrics, there are scores of methodologies and programs that localities employ to enhance their well being.

What’s Our Economic Development Agenda?

This is a tough question. The Mayor and City Council more or less set the policy agenda based on the strategic plan and the Council’s annual update of priorities. In October 2017 the city received a voluminous consultant study, the “Housing and Economic Development Strategic Plan” that is replete with recommendations on what to do. The city is using it as a kind of foundational guide to its thinking.   

But the issues that get addressed (what gets done first) are affected by those stakeholders  who speak up and bring their concerns to bear. 

To start with, we’re all aware that our property taxes keep going up year after year. The tax rates gets set by both the County and City. For those of us on fixed or modest incomes, this is a big problem. Being able to live in the City — whether you own or rent — is becoming more and more challenging. That’s not news, is it? This side of shrinking the city and county governments, the only practical solution for rising taxes lies in increasing Takoma Park’s assessable tax base. And for this we need commercial property developers to improve their properties in a big way and build more affordable and market-rate housing.

  This side of shrinking the city and county governments, the only practical solution for rising taxes lies in increasing Takoma Park’s assessable tax base.

Some Key Issues:

Here are six. I could easily give you lots more, but will spare you. Dear readers can think of others, doubtlessly.

(1) The Rent Stabilization ordinance (“rent control”) is timeworn and it does not work the way it used to. Conscientious landlords are operating in the red. They cannot increase their rents adequately to cover the upgrades they need to undertake. This is not a a sustainable situation for them or the future of affordable housing.

(2) Why has there been no new housing, especially affordable units, built in the City for the past 40 years? How can the City best leverage its limited resources to get movement?

(3) Instituting a proposed tax-rate differential on commercial properties is something the City Council is currently wrestling with. Councilmembers recognize the need to gain input from the business community. 

(4) The county boundary line along parts of New Hampshire Ave and University Blvd. is lamentable. From an economic development perspective each county seems paralyzed into inaction. Why? Because how does a jurisdiction promote half a business neighborhood? Well, one answer lies with the Old Takoma Business Association that promotes and markets across a state boundary. Let’s do something similar at the Crossroads and along the lower part of NH Ave. County leadership is called for!

(5) Now that Montgomery County has a new chief executive in Marc Elrich, maybe now we can advanced the idea of designating the Crossroads as a TIF (a tax increment financing district) for at least the Montgomery side of the Crossroads and ideally for all four corners. As assessed values in the district rise TIFs earmark some or all of the incremental increase in property taxes for either or private development purposes in the district.

(6) The very best way to attract the specific businesses we want is to harness our business leaders to join with the city in talking with the corporate officers, making the case, and inviting them to our city. That’s far better than our passively waiting on shopping center leasing agents to make these decisions for us. 

These six issues have one thing in common. By addressing them together they conjoin our business and city leaders in pro-actively growing and developing Takoma Park the way we want it. In truth, you will not find more ardent Takoma Park boosters than the business men and women who make their living here.

How Does This Get Done?

A bit of historical context here:  Much of Takoma Park’s reputation and civic pride has been built — since the 1960s —  on its ability to stop destructive development and protect its physical character. If Takoma Park has a reputation as a difficult place to build or own income-generating real estate, well, we’ve earned it honestly. Now, however, that has to change. 

But it won’t be easy. It will take time.

As cited above, on the east side of town where there is considerable room for growth, the City and the business community can and need to work together to get redevelopment underway.

With minimal expense to the city, sensitive development can get us a new Recreation Center; a lot of quality housing, and far superior shopping and dining experiences. We do not need more auto parts, cell phone, mattress and check cashing stores, pawnbrokers, nail salons, and tax and insurance services. In the NH corridor alone, we have enough (9) franchised quick service restaurants (QSRs), and 8 gas stations. In the Crossroads area alone I counted 9 cell phone stores and 14 tax preparers, and these are just the ones with prominent signs.

Serious investors with ample capital might want to replace the Econolodge and Quality Inn — our notoriously hottest crime spots in the City — with high-rise housing, retail, community space or perhaps a proper hotel. South of the Ethan Allen Avenue intersection, we see acres of land, asphalt parking lots, and obsolete structures that represent tempting targets for hugely lucrative mixed-use projects.

Obviously, the creation of an economic component within the city is the critical first step. Hooray for that! But the second critical component is enrolling our business community in the process. Again, here’s why it is so important:

In other words, government can only do so much.

In that regard, Takoma Park can try to provide incentives and form public-private partnerships as inducements. The City has already amassed a $700,000 fund to support affordable housing. Sections of NH Ave, University Blvd., Holton Land and Sligo Mill Rd  areas are designated by the State as Enterprise Zones, which provide employment and property tax credits, certain Montgomery County fee waivers and certain utility exemptions.

Greater Takoma Business Alliance

The GTBA is not intended to be a membership organization in the sense of paying dues or who gets to vote. Rather, it’s an interest group, or call it an affinity group, of concerned business people who do business in and around Takoma Park. It should be inclusive, not exclusive. 

Residents can also participate because in this context they are consumers with tastes and preferences. Residents also can learn a lot about what it means to be in business for yourself and have your livelihood grounded on the success of your investment and enterprise. If you have never been in those shoes, you really can’t know what it’s like.

The GTBA will not supplant the Old Takoma Business Association or the Crossroads Development Authority; rather just the opposite. They will strengthen each other. The GTBA can represent business not part of these two organizations, and also it will be issue oriented. The two existing organizations focus on promoting, marketing, sponsoring events and helping individual proprietors in their respective geographic areas.

The GTBA will take on whatever shape best suits the participants’ interests. Regardless, it will enable members of the business community to become more fully informed about whats going in the city that may affect them. It will be an effective means for lobbying the City Council. 

My belief is that the business community and the City’s new economic development staff will naturally want to work together to address problems, like those I previously described, and to exploit opportunities. Since business owners don’t all think alike, the GTBA will be a place for opinions to be heard.

I have been meeting with various business leaders over the past six months. All are interested. The Greater Silver Spring Chamber of Commerce is also interested in helping out. Soon I will be initiating a first meeting of these folks, which hopefully will be the first of many.

Dear Reader, if you are interested and want to be contacted, please get in touch with me at You can also find me on LinkedIn.


Frederick Schultz 1/12/19

The Purple Line Myth


Recently I had an unexpected, interesting conversation with former Takoma Park Mayor Kathy Porter about the Purple Line and its future impact.  Kathy Porter’s thoughts and questions got me to thinking about the validity of some (perhaps a lot) of people’s concerns about the Purple Line (PL).

Kathy knows a lot about public transportation. She has served since 2011 on the WMATA (Metro) board of directors. Prior to her 10-year service as our mayor, Kathy served on the Greater Washington Transportation Planning Board for nearly 15 years including a stint as chair. So I value her views.

She’s concerned about the negative impacts the PL will have by perhaps disrupting and displacing businesses during construction and the possibility of rising rents for both residents and businesses. Kathy is not alone. I’ve heard this from others.

For years we were concerned there’d never be a Purple Line. Now the concern is no longer about “if” or “when,” but whether the PL will trigger wholesale redevelopment in Long Branch and the Crossroads areas – where two PL stations will be located – and, second, will small businesses be forced to close. Will rising apartment rents push out immigrant families who shop in these businesses? In turn, these households themselves may get dispersed. This rich diversity is one of the assets that attract people to greater Takoma Park.

All of this seems reasonably probable on the surface, but there is in fact very little evidence to support this outcome. This is the myth. To the contrary, there is plenty of evidence and precedent to suggest that little will change right away in the Crossroads or Long Branch areas. And when change comes, it will be gradual at first and then may accelerate. But it likely will take years.

Consider this. The Takoma Metro station on the Red Line opened February 1978. It took about 30 years (about 2010) for significant new, privately financed construction next to the station to begin. In 1978 downtown Silver Spring was already an important regional business center, but real transformation related to the Metro only began around 2000 and only then because of aggressive efforts led by County Executive Doug Duncan.

The West Hyattsville station on the Green Line is familiar to many of us as a sometime better choice to get downtown via Metro. It opened 25 years ago, November 1993. No significant construction, including residential, has occurred yet. The station area remains surrounded by empty land.

So, just because “they build it” does not mean “they will come.”

Just to make sure all readers are on the same page, the 16.2-mile PL will have 21 stops with two stops serving Takoma Park; one in the Long Branch area on Arliss St. at Piney Branch Rd., the other on University Blvd at NH Avenue in front of the new bus transit center. Technically called light rail, it’s a confusing term in my opinion. (Metro is heavy rail, in case you are wondering). Instead, think of what in the old days used to be called streetcars. In Europe, they are called trams. Basically the “train” will be a single 136-foot long, open gangway railcar allowing passengers to walk the entire length. Power will come from overhead wires; rails will run mostly (95%) on the surface, typically in the middle or the side of a street, but separated from traffic. Stops (or stations), in most cases, will be simple ground-level platforms.

There should be no doubt the Purple Line will be an extremely valuable and an influential asset to the region and Takoma Park. It will improve mobility for everyone, but most importantly for lower wealth people who lack mobility, and those who prefer not to own a car. Mobility is intrinsic to economic wellbeing. Rail transit has hugely environmental advantages too, but these and other aspects aren’t topical here.

The Crossroads Station Area

The commercial district around the intersection of New Hampshire and University has the inherent capability to become a major regional draw, far more than it is now. I am often asked why hasn’t the Crossroads and NH Ave in Takoma Park been redeveloped long before now? Won’t the Purple Line spur development?

I’ve been wrestling with these questions for years. There’s a long list of reasons.

1) Much of the 2-mile stretch of New Hampshire Ave, except near the Crossroads, is chopped up into small parcels. It’s hard to assemble small parcels into big ones.

2) Larger parcels are already occupied by large buildings such as the Bank of America facility at Sheridan St., the U-Haul facility, the Spanos-owned shopping center (opposite), the “Shoppers Warehouse” center and the Washington-McLaughlin site.

3) All these were built 40 to 60 years ago when land was cheap and there was no premium for efficient land use.

4) Current landowners don’t sell because they are making good money from full occupancy and competitive rents.

5) The typical cost of development includes at least 5 years or longer of design, engineering, legal expense, community push-back, city and county review and approval, permitting, construction and lease up. Plus there is the loss of income for 2 or more years when no rent is coming in. In comparison, in downtown D.C., Bethesda and Arlington there are obvious gains to be made by building high-rise buildings.

6) Sometimes would-be developers find it’s just easier to build elsewhere because of fewer complications.  Developers tend to play follow the leader, which you see in Wheaton, Silver Spring, College Park and Hyattsville.

7) Ignorance is part of it. Some current owners and would-be developers seem ignorant of the gold mines they are sitting on along NH Ave . (The City’s future economic development program can cure this.)

8) Neither Prince George’s nor Montgomery County has lifted a finger to promote these areas or help induce development (a “political” failure). Takoma Park has done a lot – more than people realize – to promote our portion, but budget limitations, staff capacity and other higher priorities have stood in the way.

A huge positive aspect is that the two counties have adopted Sector (Master) Plans for their respective sides of the Crossroads business area that are premised on Transit Oriented Development  (TOD). Montgomery’s new zoning ordinance offers incentives (using the “Optional” site plan method) that allow higher densities for certain project features. In addition, the City and the MoCo Planning Department established “Urban Design Guidelines,” which set standards that architects and designers have to follow as part of the site plan process. This is important because every developers benefit by knowing exactly what’s expected of them as they plan their projects.

Given the long lead times to redevelop a large site, if commercial property owners were keen on taking advantage of the new PL service arriving in 2022, they would be announcing engineering and design efforts by now or pretty soon. But, there is no hint yet that any of that has started. While I’d like to be wrong about this, redevelopment will come slowly.

Purple Line construction will indeed be disruptive, and a real pain for some businesses, but not all. Rents will increase, but they will rise anyway even if there were no PL. As rents rise, but so will revenue growth for most well run businesses. We will witness some businesses closing. Again, keep in mind there is always a natural turnover among business tenants. And, businesses close for a multitude of reasons. (I can vouch for this from personal experience and professional experience as a banker.)

I have no doubt, however, redevelopment will occur if for no other reason than the forces of powerful regional economic growth and the decline of alternative development opportunities make it inevitable.

Long Branch Station Area

This commercial district is more or less bounded by Arliss, Flower and Piney Branch. These three streets encircle the primary commercial block now occupied by two supermarkets (Bestway and Giant), two large restaurants (El Golfoand El Gavilan), a Pentacostal church in the old Flower Theater, a dollar store, laundromat, Precision Tune, a hair academy and Capitol One Bank, among others. The Mary Center is moving out, and a rumor indicates the Bank of America may move. There are also many acres of paved excess parking.

Throughout Long Branch are countless small enterprises that may be wholly unremarkable, but are vital to the nearby residents. Most cater to the Hispanic community exclusively, which is composed largely of low wealth, hard-working households.

Significant private development can only occur when land ownership is consolidated into large enough tracts to make development practical. The described area is held under three ownerships. Fronting Flower Ave is a long 104,000 square foot parcel; a 212,000 foot piece contains the Giant Food and Capital One; a 103,000 foot piece features the Bestway Supermarket. (The Flower Ave frontage is roughly 160 feet deep, which might limit future retail development to a row of stores like there is now.) Redeveloping any of these parcels may, however, come at the cost of temporarily losing one or both supermarkets and might involve underground parking, which would be an environmental boost.

But don’t panic just yet because the next questions are important.  What could be built on these parcels? Is major redevelopment likely?

Another small shopping center lies just south of the Piney Branch /Arliss intersection and east of the Shell station. This 110,000 foot parcel contains at least 15 small retailers and services (like tax, accounting, staffing), including the Americana Grocery. Its size and proximity to the PL station would seem to be appropriate for redevelopment. But again, what would be the motivation to tear down and rebuild? Would it be to replace small stores with different small stores.

It’s important to realize that Long Branch is a “neighborhood” business area. The Long Branch Sector Plan refers to it as a “regional draw” (p. 21). It’s actually not, except maybe for two restaurants. Some others, like Ocean City Seafood, sell to a wide market. Long Branch’s commercial potential lies in providing convenience services to an area within perhaps a one-mile radius. Outside this radius consumers have similar but closer options. From a real estate developer’s viewpoint this is important because it tells them what kind of business they can attract.

Still, individual businesses can have a much larger market draw. If, for example, the former Flower Theater were converted back to a movie house showing a mix of art, first run and classic movies – like the Old Greenbelt Theater – it would be a regional draw.

The Sector Plan talks about preserving the single-family and multi-family housing that’s already there and supporting the existing small business character. The CRT (mixed use) zoning category, oddly, seems to allow large F.A.R.s (floor area ratios) and 50 to 100-foot tall buildings. Possibly, this will enable 7 to 9-story apartment buildings on the large parcels.

Is major new development likely in Long Branch? Yes, in my opinion. Much of it could include workforce housing (MPDUs), senior living, as well as market-priced condos and apartments. In conjunction, new retail, grocery, restaurant and service businesses would be a natural fit.

The point is that the PL could well stimulate new development, which may displace some small, minority-owned businesses. But new businesses are likely to be the ones that will serve the existing demographic in the Long Branch community.

The concerns shared by Kathy Porter (and no doubt others) need to be heeded. They are constructive and understandable. Nevertheless, it is far more likely that the economic and social changes that may be induced by the PL will be gradual and actually beneficial rather than disruptive.

Central Americans’ presence has long dominated the Long Branch and the Crossroads areas and the goods, restaurants and language usage reflect this.

Economic change inevitably accelerates shifts in the character of neighborhoods including ethnic makeup. We may well see this happen in the coming years. If Hispanics migrate out, we may see more Africans, Haitians, Caribbean people, Southeast Asians and Indians expand into these areas and increase the diversity. The richly diverse “International Corridor” can certainly coexist with redevelopment.


The 2nd American Revolution


The Lone Ranger rides into a little town with his trusty Indian sidekick Tonto. Tonto says, “Kemosabe, something’s not right; it’s too quiet here.” Lone Ranger replies, “Yes, Tonto, I sense the same thing. Let’s dismount.” We all know what’s coming next.

I feel like Tonto these days as we observe President Trump in the White House. Call it a vibe or perhaps an undertone to the daily news. There is something in the air telling me of impending danger to our nation. But yet it’s nothing that I would dare to predict. It’s just a heavy, mournful feeling.

Just as wild animals can telepathically sense impending danger and will move to higher ground or deeper into the forest, we humans need to take seriously the feeling that something is not right. We need to cease the Pollyanish attitude that “this” can’t happen here. It may happen in Argentina, Turkey or Hungary, but surely not here.

Cable newscasters keep using the term “unprecedented” to describe President Trump’s behavior. “Unprecedented” is what history is all about. History is the story of what happened that had never happened before.

As bad as the situation surrounding President Trump has become, my sense is that things are going to get far worse before they get better. American history reminds us of numerous transformative events. Sometimes they’ve come out of the blue (JFK’s assassination, 1961). Sometimes we “know” it’s going to happen, but remain in denial such as the 1941 Japanese attack on Pearl Harbor. More recently: the 2008 financial collapse.

Unfortunately, American history is almost always taught by looking backward from today to how things happened yesterday. We learned, for example, about the birth of our nation and the Founding Fathers’ great wisdom and courage from the perspective of 230 years later. Logically, you think to yourself, “Isn’t it great how great America has become; how everything has worked out despite all the obstacles.” But back in 1775 none of that was guaranteed.

In the little towns of Concord and Lexington in Massachusetts on April 19, 1775 no one knew that day would be the day the American Revolution would start; the day an unknown militiaman fired the “Shot heard around the world”.

It feels like we are approaching that day . . . a transformative time in America’s history. Consider that we may be witnessing what may become known as the 2ndAmerica Revolution. No, not Minutemen attacking the British Redcoats; not a war, but a profound reckoning and, hopefully, a rediscovery of the values that America was built on.

Right now, however, as we breathe, we are enduring a critical time in our nation’s history. Things that for generations we’ve taken for granted about our Republic (to which we pledge our allegiance) are threatened. Our Congress, as delineated in Article I of the Constitution, has become fratricidal. A 72-year old child who lives in a land of make-believe heads the Executive Branch. His babysitters are, based on Bob Woodward’s interviews, terrified of what Mr. Trump’s next impulse may be. The Attorney-General seems to hang by a thread.

Mr. Trump is consciously undermining the Rule of Law and his Oath of Office. Describers of his character find themselves groping for new adjectives. Regardless of what he is (or why), it is clear beyond a reasonable doubt that he lusts toward authoritarian rule, or as much of it as he can grasp. (The word pussy comes to mind here.) I doubt Trump consciously knows this – he lacks the self-awareness – but he has a visceral response that leads him toward authoritarianism.

One noted political scientist describes “authoritarianism’s equilibrium as resting mainly on lies, fear and economic prosperity” [Przeworski]. Another writes that populist authoritarian regimes “are mobilized regimes in which a strong, charismatic, manipulative leader rules through a coalition involving key lower-class groups” [Gasiorowski].

Thus, Donald Trump lies. He disparages the press as the “enemy of the people;” he castigates judges who rule contrary to his wants; he disparages and humiliates anyone less than fully loyal. He debases his own civil service (the “Deep State”). He bloviates upon his superiority and righteousness. He persists in campaigning in front of white working class audiences, while actually doing little for them. Trump praises Vladimir Putin, Recep Erdogan and Kim Jong-un because he wants to be like them. And, by praising their character and accomplishments, he justifies (to himself) his imperialistic grab at all the authority he possibly can get.

The President is neither a Republican nor a conservative. The Republican Party is the sheep’s clothing he hides under, and he shifts under this mantle to sustain his base of loyal voters. He is not loyal to Republican credos but, like Svengali, is loyal only to himself while cleverly mouthing the words congressional Republicans want to hear.

There’s no evidence that Trump gives a damn about dealing with immigration, re-building the nation’s infrastructure or strengthening the middle class. If he cared about these things he could easily have done something about them. But he hasn’t because of one practical reason:  once he does, he won’t have those drums to beat anymore to rally his believers. Authoritarians need enemies to keep their followers in line. So, of course, Trump finds his enemies everywhere including the press, the FBI, Muslims and anyone who doesn’t look like a Norwegian.

Through 44 presidents Americans have never experienced a president like Trump. We have no reference points: not even Richard Nixon who had some redeeming accomplishments and a conscience at least. That has made it hard for any of us, including reporters, to figure out what Trump is doing. An authoritarian? It is incomprehensible to most of us, understandably.

Trump isn’t going to stop. He feeds off of criticism and chaos. The more, the better. He has cowed most members in his own party who have chosen either to kiss his ring, scurry off into a dark corner, or resign. If Trump becomes a cornered man by the Mueller investigation, expect him not to cave but to usurp even more power and authority. Like a blooded bull, his instinct is to attack and tear down.

The mid-term election may see a Democrat-takeover of the House. No matter how optimistic you may be, Donald Trump will still be Commander in Chief and the so-called leader of the free world.

So what do we do?

We need to vote in November, of course. Democrats capturing the House will stymie Trump’s legislative efforts as scant as they have been. Democrats will initiate legislation that will force the Republican-led Senate to react. My bet is Republicans will start second-guessing and become more cooperative. Trump will become more combative; or he might decide to abandon his Republican supporters and talk like a Democrat: whatever is best for Donald, Donald will do.

What if, like the 2018 election, the polls are wrong and Republicans keep the House? The first Revolution wasn’t won in a day. We hang in there.

Impeachment needs to be pressed. The Republicans who survive the 2018 election will be a chastened lot. Like a termite-ridden house the party has effectively rotted, existing in name only. Without Trump it collapses. The so-called “resistance” inside the White House and the sycophants outside are all that remains at the national level. It has abandoned its classical conservative ideologies that go back to Thomas Jefferson. Impeachment and conviction will, in fact, serve the interests of both conservatives and liberals.

We cannot count on any particular outcomes from the Mueller investigation. Liberals and conservatives, I believe, can find common ground to help America recover from this era of debasement.

In the long term our schools have to do a better job teaching young people the meaning of the Bill of Rights, the 14thAmendment and the essence of the Declaration of Independence. Too many voters simply have no clue of the protections afforded by these key documents, what they mean and the limits on those protections. This is stuff that must be learned in high school. The big lessons of America’s history need far more emphasis in our schools. The scope of ignorance among American voters about these matters is appalling. Too many voters sing the national anthem and think they are patriots.

Finally, let’s thank Donald Trump for one good thing he’s inadvertently done. He’s raised the consciousness of millions of American by awakening them from their peacetime torpor. Women, discriminated minorities and young people have awakened to become politically engaged or run for office. Thanks to Trump, folks are catching on to the fact our democracy and are institutions are not marble edifices of a different era, but a living, breathing organism that has suffered abuse and been taken for granted long enough, and now must be vigilantly nurtured and defended.

There may not be a Paul Revere riding today, but we know the Redcoats are coming and everything – truly everything — is at stake. We have to make our stand. I think the free nations of the world are listening for another shot to be heard around the world.