Post #306, Where do we go from here, part 2: Falls Church

Posted on June 27, 2019

Falls Church was mentioned at one of the Town’s joint work sessions on changing MAC.  The context was that Falls Church uses a completely different zoning mechanism for their mixed-use developments.  So  I thought it might be worthwhile to sketch out how Falls Church goes about it, and contrast that to the Town of Vienna MAC zoning.

I don’t claim to understand zoning in full detail.  So, in the main, you’re getting an economist’s view of the different approaches taken by Vienna and Falls Church.  And, to be clear, this isn’t an endorsement of what Falls Church is doing, it’s just a summary of a different approach used by a nearby City.

In a nutshell:  Vienna tells developers exactly what they are allowed to do, in a set of explicit zoning rules.  Falls Church, by contrast, tells developers what Falls Church wants to get out of redevelopment, in a free-form exception to the zoning rules.  I believe that difference gives Falls Church a much better bargaining position vis-a-vis developers.

Town of Vienna: MAC zoning

You can see the actual language of the law at this link.

MAC zoning, in a nutshell:  Under MAC, the Town allows builders to exceed the limits placed on “by right” commercial developments on Maple (“C1 zoning”).  Developers must request this, and in theory, in exchange for building larger buildings, they must provide some substantial public benefit to the Town.  Beyond that, MAC zoning is prescriptive:  It sketches out for the developers more-or-less exactly what they can legally do.

  • The Town lays out exactly how large any MAC building may be, by setting a height limit and required setback from the roads or property lines.  In effect, it lays out the size of the “box” that the builder may fill.
  • It sets some additional restrictions on the buildings:  minimum height for the first floor, maximum setback from the street, bans parking in front of the building, and so on.  For buildings that are not wholly commercial, it requires that (some significant portion of) the Maple Avenue frontage be used for retail space.
  • It lays out an explicit set of “incentives” which appear most oriented toward reducing use of cars.  For example, if a builder closes a driveway (curb cut) on Maple, that allows them to take a 5 percent reduction in their parking requirements.
  • In practice, but never made explicit, it requires builders to proffer (voluntarily offer) to put the utility lines underground, for any poles on the property.
  • It requires that the buildings pass a certain standard of architectural quality (via review by the Board of Architectural Review), and also sets some other minor standards (e.g., width of the sidewalks).
  • There are requirements for (e.g.) stormwater management, but I believe these just mandatory standards imposed by the Commonwealth and the county for any new construction (i.e., I don’t think these are unique to Vienna).

Analysis:  In my view, the upshot of this approach is that the Town has largely given away any bargaining position it might have.   This is a point that has also been made repeatedly by Town Councilman Majdi.  And, given that Maple Avenue land owners were instrumental in overseeing the development of the law, that should come as no particular surprise.

The Town tells builders what the largest legal MAC building is — the size of the “box” they may fill.  As a result, every mixed-use proposal under MAC starts with plans for a building that more-or-less “fills the box” — i.e., a building that is more-or-less at the height limit and more-or-less fills the lot to the setback lines.  And that offers the least possible “public benefit” to the Town.  And then, having established that as the baseline, the Town has to push back to get anything other than that.

Worse, depending on whose legal opinion you trust, by setting out these explicit requirements, MAC may in fact generate a new type of “by right” development.  That is, once a builder meets all the legal requirements (of setbacks, height limits, adequate architecture, and so on) … it’s not clear that the Town has a legal basis for turning down a project.  A developer might have the legal right to proceed with it.  I have a brief mention of this in my just-prior post, and more extensive discussion in Post #261, Post #262, and Post #263.

In effect, the Town says:  This is exactly what you are allowed to build.  Several members of the Town Council really want to see a bunch of MAC buildings put up.  And now that you know that, what benefit do you intend to give back to the Town?

Falls Church:  Special Exception Entitlement zoning.

You can see the actual language of the law at this link, and see a list of projects at this link.

Falls Church Special Exception zoning, in a nutshell:  The City of Falls Church allows developers to ask for exceptions to the existing zoning rules.  After work by their City staff and Planning Commission, the Falls Church City Council determines whether or not to allow each such exception, based on a broadly-defined notion of how it will benefit the city.

Otherwise, the City of Falls Church picks out “Revitalization Areas” in pretty much the same way that Town of Vienna picked Maple Avenue.  Falls Church marks entire streets as being ripe for redevelopment, and so encourages developers to focus on those areas.  This is done as part of their comprehensive plan.

In addition, Falls Church produces “small area plans” for a handful of areas within the city.  These are plans for a few blocks of the city at a time.  In these small-area plans, the City is more directive about what it might want to see done, where.  These small-area plans are supposed to guide developers who want to redevelop within these individual neighborhoods.

I really can’t do it justice by selectively quoting their statute, so if you have an interest, you really ought to go look at the language of the law (linked just above).  But here’s a key section:

The intent of this subsection is to allow for the consideration of all opportunities available to add to the office, retail, hotel, and other commercial uses in the city. Residential uses will be considered if they contribute significant positive net revenue benefits to the city and build community. Review of proposals will be guided by the needs of the city, market and economic conditions, and special characteristics of the parcel being considered. These special exceptions applications will be evaluated using the following primary and secondary criteria. The primary criteria are essential to the character and well-being of the city, whereas the secondary criteria are discretionary in nature.

The law then goes on to list the criteria, for example, net new commercial square footage, substantial positive net new commercial and residential revenue to the city, or is 75% or more “affordable housing” units.

Analysis:  Instead of telling builders exactly how they must build, the City of Falls Church tells builders what the City of Falls Church wants.  And then says, in so many words, make me an offer.

On paper, this does not really seem that different from MAC.  You’ll see much the same language in the MAC statute’s “statement of purpose and intent”.  But as a bargaining position, it’s worlds apart.  It directs the builders to come in and show a full menu of benefits to the City.  For selected neighborhoods, it has its own neighborhood-level plans.  This compares to MAC, which tells builders to come in with the biggest building that will fit inside the legally-allowed “box”, on whichever properties they choose.


A caution about using Falls Church as the model.

I have posted this point before, on this page.

In terms of the costs and benefits of redevelopment, a key difference between Falls Church and Vienna is that Falls Church collects all the taxes generated from those properties.  It is one of the independent cities of Virginia, and as such, it displaces Fairfax County.   It runs its own schools, largely runs its own courts, and in general replaces Fairfax County and so collects all the tax revenues that Fairfax County would otherwise collect.

As a consequence, Falls Church benefits vastly more from redevelopment than Vienna does, financially.  Falls Church is particularly good about calculating and reporting those benefits, as with their table of tax revenues for various types of property, per square foot of ground (pdf).

Vienna, by contrast, collects only a small fraction of the taxes generated by redevelopment.  Most of the revenues in fact go to Fairfax County.  So, where Falls Church bears 100% of the burden and reaps 100% of the benefits, Vienna bears 100% of the burden and reaps … maybe 15% of the total tax revenue benefits.

So a) what makes sense for Falls Church may not make sense for Vienna, and b) to achieve the same level of “payback” that Falls Church receives, the Town of Vienna would have to receive vastly more direct benefit (e.g., parks and plazas) from these new buildings.  So for, there is little to suggest this is the case.