PUBLIC ENGAGEMENT | When Development Gets Thwarted by Incompetence
A years-long process with multiple bids in Louisville shows what happens when cities fail to get stuff built
Written By Satchel Walton
There is a piece of land for sale in an up-and-coming neighborhood a mile and a half outside the downtown of the 28th largest city in the country. In surrounding neighborhoods, property values are booming and there are concerns about gentrification. Despite these market forces, all 10 acres can be yours for just $1.
Sound too good to be true? The parcel known as the Urban Government Center is owned by the city of Louisville, Kentucky. It is the site of three long-abandoned buildings. For the last six years, the government has been trying to get someone to redevelop it. It has been a saga of negotiations involving three different developers, multiple threatened lawsuits, and a payout of $150,000.
In theory at least, everyone agrees that having something there is better than leaving dormant, decaying buildings. So what’s preventing development from getting done?
Let’s look at the timeline:
According to local historian Tom Owen, a University of Louisville professor and former member of the city council, the site was home of the Kentucky Baptist Hospital from 1924 through 1989. Physicians and local government offices began to move in in the 60s. In 2016, the local government closed its remaining offices in the buildings due to environmental concerns like mold.
In August and October of 2016, there were a series of public meetings on the potential redevelopment of the site, and in March of 2017, Louisville government received five proposals from developers. In December of 2017, one proposal—by the local Marian Group—was accepted.
The developer proposed to build 22 shotgun houses and a farmers’ market, only to be pilloried at a public meeting over housing density. Still, the plan went ahead.
In 2019, though, it emerged that Louisville had promised the Marian Group a two-acre parking lot that was already part of a separate deal. The city’s development office also failed to get land-use changes in the promised timeframe. The Marian Group stepped back from the project and settled disputes with the government for $150,000.
It was an embarrassing mistake on behalf of the local government. They persevered, however, and solicited new proposals for the site. They got only two, down from the five original hopefuls. Negotiations with the next developer chosen, Jeff Underhill, fell through due to lack of funds. Louisville’s development agency then offered to help Underhill’s company get approved for a Tax Increment Financing (TIF) district, which would allow for certain tax revenues generated by an area to be dedicated to specific improvements on the site in question. Still, Louisville was failing to give away a valuable urban plot of land—for less than free.
Amid this whole chain of events, nearby neighborhood associations worked toward their own (often incongruent and competing) goals for the parcel. The Germantown-Paristown Neighborhood Association still proposes an urban forest “as an alternative to more development in an already crowded neighborhood.”(1) Louisville also requires the developer now working on the (third attempt of the) project to negotiate a Community Benefits Agreement with six surrounding neighborhood associations. According to WDRB, the neighborhood associations have requested annual payments from the developer and wants them to “install lights, better sidewalks, curbs with cuts and pedestrian crosswalks on Vine and Breckinridge streets, as well as support for converting some streets to two-way traffic.” At the moment, the neighborhood associations, the local government, and developers still seem to be caught in a three-way tangle of mutual bafflement and frustration in trying to work with each other.
I don’t have all the right answers. I don’t know the full story behind this long-running issue that seems to confound even the people most knowledgeable of Louisville’s urban planning ecosystem. But we have to ask: Why can’t the local government get this development done? Residents ought to have a say in their neighborhoods. Gentrification is a real concern (although I would dispute that new development causes it). But at what point do neighborhood associations start acting like cartels that manipulate public processes to keep out new housing?
While this issue has played out on a distinctly local stage, it seems to be illustrative of a wider issue: America is struggling to get stuff built. The agonies span far and wide, from practitioners simply trying to build new housing to California’s efforts to build a high-speed rail line. There, for example the French company working on the project “told the state they were leaving for North Africa, which was less politically dysfunctional. They went to Morocco and helped them build a rail system.” At local, state, and federal levels, there has been a proliferation in the number of veto points present in American politics.
Letting more people have a say is great, but the way we’ve done that creates a massive status quo bias by setting up more barriers to building and creating change. Moving forward, we have to balance community input with the need for vigorous, flexible action.
(1) For context, in Germantown-Paristown, 44 percent of renters are estimated to be “cost-burdened” by housing despite a declining population. And the density of 6,580 people per square mile, while high by Louisville’s standards, is still below the level of around 10,000 per square mile needed to support efficient transit.
Satchel Walton is the Mencken Publishing Fellow on Urban Development.