Transportation, Land Use and Economies of Scale

Once upon a time, in a place far away, a young man attended one of two junior high schools in a town of 30,000 persons. The one-mile walk or bike ride was a typical routine, and all was well. Thirty years later, this town, still 30,000 residents, built a single new junior high school to replace the two older facilities. The single larger facility offered economies of administration and the opportunity to amortize the cost of specialized facilities such as music rooms, shop facilities, and media centers over a larger student population. There could be efficiencies and specialization in the delivery of special education programs, counseling, and services. Amenities such as a swimming pool could be afforded and the library had more offerings. But, now, many students had to travel far more than a mile to get to school. Approximately half the trips were now longer than the prior longest journeys and the prospects of walk and bike travel diminished significantly as the share of students beyond reasonable bike and walk distances grew dramatically.

The trips back to school for sports practice, band, or clubs were longer. Even some non-school trips were longer as the social network of friends expanded to match the larger geography served by the school. These social trips were also beyond the range of walk and bike travel. There were a lot more vehicle miles of travel. But the density, urban design, and urban form of the city had not changed significantly.

Transportation-land use discussions often revolve around the implicit assumption that one is trying to minimize transportation infrastructure and operating costs. The principal motivation for transportation-land use coordination is premised on more complementary land use patterns resulting in lower travel demand and a corresponding lower transportation infrastructure and operating cost. Often ignored in this thinking are the business or public costs associated with operating a given activity. Regardless of the urban design characteristics, modal options, urban area transportation network configuration, and land use density levels; many individual facilities are choosing to develop at a larger size than was historically the case. The larger operation requires a larger market area to provide a population sufficient to support the activity. This results in longer average trips and a higher propensity to drive. The increase in activity scale has outpaced any reasonable expectations of densification stabilizing the geographic service area and the actual size of the facility becomes more difficult to design with sensitivity to the human scale of a neighborhood.

Some facts:
The average size of an elementary school in the U.S. has grown from 155 students in 1950 to 473 in 2000.
America has gone from having 81 grocery stores per million persons in 1977 to 35 per million in 1997.
In 1970, there were 34 hospitals per million persons. Today, there are 20. With 1300 fewer hospitals, you will need to travel farther.

The competitive business environment that governs the economically-viable size of a given facility for many land uses has changed over time. It is not clear that the body of research on transportation and land use fully appreciates the economics of many land use decisions as they relate to the scale of the facility. While Wal-Mart Supercenter controversies have brought attention to this issue, it is not clear that the transportation implications of activity scale are fully understood in terms of the tradeoffs between business operating efficiency and travel demand.

The planning profession's knowledge about the transportation-land use relationship has increased over time with literature such as Travel by Design: The Influence of Urban Form on Travel, (Boarnet and Crane, 2001), and the synthesis report Land Use and Site Design, Traveler Response to Transportation System Changes (Chapter 15, TCRP Report 95, 2003), which provide a rich and comprehensive review of the theory and findings of research into the infamous transportation-land use relationship. But the body of literature remains deficient in exploring the contribution to travel demand and travel behavior attributable to changes in the economics of how businesses and services function.

The existing literature, including literature on the cost of sprawl, is focused on the land use traits of density, mix of uses, contiguousness, and urban design. An analysis of the implications on travel of evolving economic phenomenon and business models is under-represented. Perhaps the most obvious example, exemplified by the school story, is the consequence of the growth in the "efficient" size for business and service functions. This phenomenon applies to a host of land uses, from big box retail to the supersizing of grocery stores, movie theaters, car dealerships, and churches. Increasingly, the economics that govern the competitiveness of business and service functions result in larger facilities requiring a larger market area to support the activity. This phenomenon is a contributor to travel demand independent of urban density and form.

The advantages of a greater selection, longer service hours, and lower prices that may be available in superstores is, perhaps, a return on our investment of higher travel time and money costs for access. The urban planners' historic inclination to seek out optimal efficiencies in travel costs and infrastructure requirements has been rather oblivious to the economics that govern the success of the respective land use activity. While planners strive to enhance the transportation-land use configuration to minimize travel and transportation infrastructure by focusing on land use mix, density, and urban design, the seemingly unrelenting movement toward larger-scale businesses and services may be counteracting these initiatives. Our desire for neighborhood-oriented land uses is undermined by the fact that many uses are now scaled at a size that is not able to be supported by or integrated within a single neighborhood, hence, they prefer locations accessible from multiple neighborhoods. The larger site size tends to bias the location of large facilities to the fringe of developed areas where larger vacant parcels are available.

Attempts to influence land use in the interest of transportation efficiency may have other unintended impacts on the costs of doing business borne by businesses and services and ultimately the public. The return of neighborhood scale retail might, for example, mean the return of limited store hours, higher product prices, and poorer selection. As the exploration of the transportation-land use relationship continues, it should be broadened to encompass a richer understanding of economics of activity scale.

Dr. Steven E. Polzin worked for transit agencies in Chicago, Cleveland, and Dallas before joining the University of South Florida's Center for Urban Transportation Research. He can be reached at [email protected].