Neighborhood empowerment and the future of the city.

Author:Stahl, Kenneth A.
Position:III. Public Policy and Neighborhood Empowerment through Conclusion: The Neighborhood and the Suburb, with footnotes, p. 969-1008

  1. The Risk of Majoritarian Exploitation

    Whenever power is delegated from a higher to a lower level of government, it raises a concern, expressed most famously in James Madison's Federalist No. 10, that a locally dominant faction may exploit a vulnerable minority. (139) In their innovative article Land Assembly Districts, Michael Heller and Rick Hills use Madison's framework to argue that both neighborhood zoning districts and BIDs present a risk of majoritarian exploitation. (140) They further contend that Madison's argument in Federalist No. 10 can help explain both the Roberge and the Salyer-Ball lines of cases. (141) Thus, this Section considers whether the problem of majoritarian exploitation can shed any light on the judicial distinction between neighborhood zoning districts and special assessment districts. I conclude that special assessment districts are likely to be more susceptible to majoritarian exploitation than neighborhood zoning districts, and are thus more deserving of close judicial scrutiny.

    1. The Federalist No. 10 and Neighborhood Homogeneity

      As Heller and Hills recapitulate Madison's argument, a large and diverse polity such as a big city is likely to feature a wide variety of pressure groups that forge shifting governing coalitions through logrolling (i.e., trading votes with other pressure groups). This political dynamic enables each group to exert some influence, but none to dominate. (142) As the size of the polity shrinks, however, the number of interest groups also shrinks, thereby making vote-trading difficult and permitting a stable majority to consistently impose its views on a more vulnerable minority. (143) This problem may be avoided, however, if the boundaries of the polity are drawn narrowly to ensure that the population has fairly uniform interests. Indeed, the public-choice view of local government holds that a homogeneous governing entity is more efficient than a heterogeneous one because it can directly effect the unanimous will of the public without the inefficiencies of vote-trading, such as conflict, bureaucracy, pork-barrel spending, and redistribution. (144)

      This Madisonian/public-choice perspective proves helpful for the present analysis because it is consistent with both the Roberge line and the Salyer-Ball line. As Heller and Hills note, the Roberge and Eubank decisions express a Madisonian apprehension that a dominant group of landowners within a small polity may selfishly exploit a minority to further its own parochial interests. (145) Likewise, the distinction drawn in the Salyer-Ball cases between a general-purpose governmental entity that broadly affects the public at large and a special-purpose entity that performs a narrow function disproportionately affecting certain constituents may reflect a similar public-choice logic. If a small governing entity performs a wide range of functions that implicates a divergence of interests, it is likely to cleave into opposing factions and, absent the possibility of vote-trading in a larger and more diverse entity, a stable majority faction may emerge. An entity that performs only a narrow function over which strong disagreement is unlikely, by contrast, does not present a similar threat that dueling factions will emerge. As such, the Salyer-Ball line subjects the former sort of entity--the small, heterogeneous entity with broad powers--to a stricter constitutional standard. (146) Accordingly, Heller and Hills conclude that to the extent a governmental entity is able to homogenize interests within the jurisdiction so as to minimize the risk of majoritarian exploitation, the more likely it is to survive scrutiny under both the Roberge and the Salyer-Ball doctrines. (147)

      a. The Neighborhood Zoning District

      Let us consider both the neighborhood zoning district and the special assessment district under this framework. Beginning with the former, Heller and Hills claim that neighborhood zoning districts are problematic because

      the opportunities for intra-group exploitation are high in a neighborhood composed of different-sized structures serving different functions. The possibility that residential owners would burden commercial structures with onerous restrictions is matched only by the possibility that commercial owners would burden residential owners with noxious uses. Even among residential owners, the owners of large and small buildings would have persistently different interests that would invite intra-neighborhood squabbling. (148) Heller and Hills direct this criticism specifically at the scheme proposed by Robert Nelson. Nelson's scheme, we recall, would enable a group of landowners within a neighborhood to petition for the creation of a neighborhood association, which would then exercise a full complement of zoning powers on an ongoing basis over the entire neighborhood. (149) As I address further below, Heller and Hills's critique of Nelson's scheme has some validity; however, it is totally inapplicable to the neighborhood-consent schemes involved in the Roberge trio for three reasons.

      First, Heller and Hills concede that the intra-group exploitation concern is mitigated wherever neighborhood control is limited to a "one-shot deal" in which the neighborhood is "not responsible for the ongoing management of different land uses." (150) The one-shot deal, while making vote-trading impossible, will also necessarily limit the ability of a dominant faction to exploit a minority. As it turns out, the neighborhood-consent schemes involved in the Eubank-Cusack-Roberge cases were all one-shot deals--landowners were given a one-time power to vote on a proposed land use change within a designated proximity to their property.

      Second, the districts at issue in those three cases all had a fairly limited purpose. They did not have general zoning powers, but had jurisdiction only to resolve one discrete issue--to set building lines in Eubank, to authorize the construction of a billboard in Cusack, and to site a group home in Roberge. (151) This limited authority likewise would reduce opportunities for conflict among landowners.

      Third and finally, Heller and Hills's critique presumes a neighborhood that is relatively diverse in terms of land uses--a mix of commercial and residential uses or, at least, a mix of large and small residential buildings. (152) In Roberge, however, the power to approve a group home was delegated only to landowners in districts zoned for single-family homes. (153) Given the capitalization literature and homeowners' well-documented concern with property values, it is at least plausible that single-family homeowners would have generally uniform interests in excluding group homes. Thus, the neighborhood-consent scheme at issue in Roberge is seemingly one that public choice theorists would heartily endorse.

      b. The Special Assessment District

      Ironically, under the criteria just considered, all of the special assessment schemes that we have reviewed--and that the courts have upheld--would be problematic. The special-purpose districts in Salyer, Ball, and Kessler were not one-shot deals, but entities with ongoing governmental powers. (154) The BID in Kessler performed a wide range of functions such as sanitation, security, and lobbying city government, not the relatively limited set of functions involved in the Roberge trio. (155) Finally, the districts at issue in Ball, (156) Kessler, (157) and Bolen (158) all operated in highly diverse metropolitan areas with a variety of land uses and demographics while limiting the franchise to a small subset of that diverse population.

      This combination of factors makes intra-group conflict and exploitation in a small governing entity almost unavoidable. This is especially true for BIDs because the basic function of the BID is to manage public spaces, such as urban downtown areas, that are regularly used by a wide variety of individuals with diverse expectations regarding those spaces' appropriate use. (159) I single out the BID here briefly because it is perhaps the most widely used and controversial device cities have employed in recent years to devolve power upon neighborhood groups. (160) For BIDs, exploitation can occur along at least three axes: among property owners; between property owners and tenants; and between property owners and other users of the space, such as street entertainers, vendors, or the homeless.

      i. Conflict Among Landowners in the BID

      First, where there is a diversity of land uses, disagreement among landowners is likely to occur, even as early as the formation of the BID. The owners of large office buildings may feel that the BID is superfluous if they are "already ... providing the supplemental sanitation and security services that the BID would offer," (161) while small business owners may see the mandatory assessments as an unwanted expense on top of already burdensome property taxes. (162) Industrial landowners, who have little concern about making the area attractive for consumers, may not want to pay for services intended to beautify the neighborhood, while residential landowners "may be unable to pass on the BID's costs to tenants or customers." (163) Once the BID is in operation, disagreements may arise over its philosophy and priorities. For example, as Richard Briffault notes, there may be tensions between owners of mainstream businesses who seek a clean-cut, tourist-friendly image for the district, and owners of bars, nightclubs, or adult entertainment establishments, who desire to cultivate a more free-wheeling environment. (164) BIDs may even lobby city hall for zoning changes that would make presently existing uses, such as adult entertainment establishments, unlawful within the district. (165) Heller and Hills conclude, accordingly, that the diverse interests of landowners within BIDs "make for contentious neighborhood politics and result in poor governance." (166) They are...

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