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Oil price cools SCV expansion

Environmentally Speaking

Posted: June 12, 2008 2:52 a.m.
Updated: August 17, 2008 5:02 a.m.
I have now lived through several California real estate boom and bust cycles, but I don't remember one as bad as the current housing crisis. Graded housing pads left to stand empty, new tracts with only a few occupants and a lot of vacant houses are a new phenomena in this valley that I don't recall from past downturns.

Perhaps it was the sub-prime loan fiasco that particularly drove the overbuilding this time.

But overbuilding always seemed to be a factor in previous slowdowns. Something else is at work this time.

I had always thought that water would be the limiting factor to an overly exuberant housing market. I can only shake my head at recent assurances by our local water agencies that water is no problem for Santa Claritans.

With state water deliveries at only 35 percent of normal and on the same day the governor declared a statewide drought, the county approved yet another 500 units in an outlying area where well water is not sufficient to supply additional housing. These units will have to be supplied by state water that comes from the already over-stretched Sacramento Delta.

"No problem," say the water managers, "we have drought reserve storage." Yes, that is true, but one shouldn't be approving housing on supplies that will only exist for the next 10 or 15 years. That water was supposedly for drought emergencies and the excess water that provided the opportunity for that storage is no longer available.

At a recent planning commission meeting, the direction became clear. "Everyone will just have to use less water," quipped a commissioner as he approved yet another huge housing project. But no restrictions were placed on the landscaping for that new approval. So, like residents of Las Vegas with their shrinking Lake Mead reservoir, our future apparently will be merely to require homeowners to remove lawns and other water intensive landscaping so that the electeds can continue to approve housing in outlying areas.

While drought tolerant native landscaping will certainly be a wonderful improvement in water efficiency for existing residents and provide "backyard habitat" for all our local native species, it will be an expensive and drawn out process to make the change. Such landscaping should certainly at least be required on any new approvals. We do not want to be in the situation that is currently facing Barcelona, Spain. Their inattention to water supply resulted in the recent necessity of shipping in tanker loads of water to the City since all other sources had been exhausted and to institute fines of up to $10,000 for watering flowers.

But it seems now that oil, not water, will be the limiting factor to growth. High oil prices do not require elected officials to find the courage to say no to a development project. The consumer does the naysaying himself. With mortgage brokers paying more honest attention to a buyer's income and down payment, the ability to meet monthly bills while making a 100-mile commute to work is no longer feasible at today's gas prices.

In spite of the environmentalists' urgent call to build hybrids, electric cars, and other high efficiency or alternative fuel vehicles, our American car companies stubbornly refused. They fought regulations to increase fleet efficiencies and crushed their electric cars. They ignored the obvious result of diminishing worldwide oil production and increasing demand. Now, while Toyota sales are up, mostly as a result of their hybrid lines, our companies are closing SUV factories due to lack of sales linked to higher oil prices.

Now developers seemed to have fallen to the same peril. The Newhall/LandSource bankruptcy is not just a sign of the current downturn. Buyers are saying no to housing in outlying areas because they can't afford the gas it would require to get to work. Again, the enviros' plea to stop approving sprawl housing and instead provide transportation-oriented, location-efficient homes in walkable or cyclable communities was ignored. Instead, bike lanes were striped over and roads widened to accommodate more and more autos generated from far-flung units that never should have been approved. Now such housing projects are in financial trouble all over the nation while closer in, more compact developments continue to sell.

Will rising oil prices crumble the very foundation of the suburban lifestyle? As Barclays Bank and Newhall begin the "re-tooling" of development in the Santa Clarita Valley, perhaps it will help to keep this new reality in mind. It seems that commuters are just saying "no" to long, expensive commutes and clogged freeways in a way that the elected county supervisors never would. With the high cost of all the needed infrastructure expansions including bridges, water and even a sanitation plant, perhaps after all, the massive and far-flung Newhall Ranch project might be better left as the rich farmland it is now.

Lynne Plambeck is president of the Santa Clarita Organization for Planning and the Environment. Her view represents her own and not necessarily that of The Signal.


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