by PWCBG’s Ralph Stephenson

For an industry or company to try to force taxpayers to subsidize a product that is already in oversupply or glut may be good politics for some, but it is not good economic policy.  Nor does it represent good government or the best interests of taxpayers.

As noted repeatedly in recent articles in the WSJ, including a page one article on Sep 26, the housing market is experiencing a serious downturn largely due to overproduction and oversupply.  Quote:  “[Lennar Homes] Chief Executive Stuart Miller said the problems are broad-based and stem from an oversupply of homes, turmoil in the mortgage market, and weak consumer confidence…

“…Sales of existing homes tumbled…in August to…the slowest [pace] in five years, the National Assoc. of Realtors said [Sep 25th]…Analysts cite excess supply in forecasting that an upturn in [housing] sales and prices may not come until 2009.”  End quote.

In Prince William County, there is already an oversupply of housing, houses are selling more slowly and prices have fallen considerably, and reportedly an additional 40-50,000 homes have been approved but not yet built.

So why would the Board of County Supervisors want to increase the glut of residential housing in Prince William County by subsidizing residential development at taxpayers’ expense?  This is in effect what the Board is doing when it keeps impact fees and proffers required of residential developers at levels well below the true infrastructure burdens created by residential development.  When you think of the infrastructure burdens created by residential development, think of heavily congested roads, overcrowded schools, rising property taxes, damage to the environment, falling property values and rapid deterioration of older neighborhoods when there is an oversupply of housing, etc.

Subsidies to business by government sometimes make sense when vital goods or services are in short supply.  But none of those conditions apply or will apply to our county’s housing market anytime in the foreseeable future.  Indirect taxpayer-funded subsidies to the housing industry make no economic sense, are not good government, and are certainly not in the interests of taxpayers.  They are, in essence, corporate welfare that benefits only the housing industry and its political clients.

Prince William Citizens for Balanced Growth, a citizens’ coalition that grew out of the successful fight to stop the 2006 Brentswood rezoning proposal, went live today with a website [] that tracks supervisor and chairman candidates’ voting records and/or statements on major balanced growth issues.  We strongly support increasing residential developer proffers, and after the 16 October Board of County Supervisors vote on proffer reform will finalize, publicize, and post on our website Balanced Growth Report Cards for all seven of the current supervisors, Chairman Stewart, and Chairman-Candidate Pandak.

My name is Ralph Stephenson.  I’m the content manager for the PWCBG website.   I’m now passing out information from PWCBG explaining its goals and why it’s important to encourage commercial development and balance residential growth with traffic, tax, job-growth, public school, and quality-of-life concerns.   Thank you.