Nathaniel Reed’s perspective on Florida’s land management ‘Ponzi scheme’

Reed is also Chairman of the Commission on Florida’s Environmental Future, Chairman Emeritus of 1000 Friends of Florida, and an honorary board member of The Martin County Consensus, the sponsor of The Martin County Times.

From his speech:

“How did Florida get here? Much of our current dilemma may be due to the fact that Florida has always been the ultimate “pyramid scheme.” The Ponzi premise – as long as you can recruit new suckers to pay back the existing club members – you’ll be okay. This pretty much sums up the management strategy of Florida over my 40+ years of observation and participation. I would invite you all to name one public program in Florida – transportation, education public health environmental resource management, where we have actually put the cost of meeting the immediate needs upon the immediate population. Florida’s history has been to expect that future growth will cover the cost of the current need – next year’s new taxpayers will get the bill for existing infrastructure deficiencies – and their new demands will in turn be paid, not in full by them, but by their successors…

“We’ve marketed ourselves as a low-tax, low-cost retirement haven. We have further convoluted the scheme with an absolutely archaic tax scheme, full of exemptions intended to provide short-term growth incentives but higher future costs – which will supposedly be covered by distributing those costs over a larger taxpayer base in the future.

“Florida, from her very beginning, has embraced “growth” – with almost no limits – as a mantra. Now we are falling victim to the downside; if we don’t keep growing, the pyramid can’t be sustained…

“Some might argue that Florida hasn’t really had unbridled growth, but rather truly managed growth, some have said over-managed – a rather hard premise to accept given the obvious massive over-building which has glutted the state…

“Traditionally when the economy has faltered, we’ve looked at incentives such as tax breaks, or the relaxation of governmental restrictions to jumpstart the money machine…Some of the same interests who gave us the current market glut, are sure to raise the argument that they need unbridled freedom to respond to “market conditions,” that the “Planning process” takes too long and will impede recovery. Private landowners who still believe that unrestricted property rights are a divine right will certainly join in any opportunity to eliminate growth management programs.

“I think that all the discussions need to face the fact that sound economic policy must also be sound environmental policy – or we’re just once again pawning the true costs into the future – with compounded interest!

“The current economic catastrophe has placed us squarely at the crossroads of Ponzi Place and Sustainable Avenue. Despite all the voices saying we need to change direction, it remains to be seen if we will, or whether we will try to characterize the current situation as a ‘perfect storm’ that will never happen again once we just get going fast again – and try to make it back to ‘business as usual.’

“This debate will also expose the dichotomy between what we say we want from politicians, and what we actually accept. In times of stress, especially, we hear calls for ‘leadership and courage.’ But re-election is much more dependent upon following the public will than trying to lead it – and the public will is currently much more concerned with immediate personal problems than the long-term future of Florida. We need to recognize that many Floridians would willingly accept another future problem in exchange for an immediate fix to their financial woes. With hundreds of approved projects dormant for lack of funding, and with an estimated two-year glue in existing housing and commercial space, we should feel no urgency to encourage more ticky-tac. It will a long-time (if ever) before fixed income retirees in the north again contemplate mass-migration to Florida. This bleak economic situation afford Florida a unique opportunity to reconsider out land management planning programs.

“We somewhat adopted the catchphrase ‘smart growth’ to imply greener, more sustainable efforts. It’s been perhaps most accurately considered a desirable ‘goal.’

“I would argue that any growth that doesn’t pay for itself isn’t smart at all!

“We now have the time, and hopefully the economic incentives, to move to become a real guiding principal in future planning.

“We need serious policies that would:

1) Promote infill and rehabilitation of existing urban areas over creating new towns. The argument for years has been that remote vacant land is cheap, and building on a blank slate is faster and cheaper – so we’ve gone toward new communities in the boondocks.

2) In the clamor of education, transportation, construction needs, etc., we also need to pay special attention to agriculture in Florida. We need an environmentally sound, productive agricultural industry in our state. We need agriculture as part of our economic portfolio, as well as for social and environmental benefits. Our current development model is driving agriculture as speculative real estate ventures swallow rural tracts. If the ‘New Town’ we gain today isn’t really paying for itself, why would we accept both the additional costs and the loss of agriculture?

3) We need to rethink new rural communities. In the future, they should only be built if they offer us true long-term benefits economically, socially, and environmentally. If they don’t, let’s learn to just say NO and wait for a true enhancement to the state to be developed. New towns have blossomed under the charade of all growth being good, and the faster the better. We need a longer view of them…

“The challenge, of course, is that we’ve looked to the Ponzi float from new projects to keep us afloat for the moment. To abandon that economic model will require developing alternative revenue sources, many of which probably begin with a ‘T.’

“Part of our problem is that we’re swept up by the concept of immediacy – ‘Let’s do something now.’ Florida land has been above water better than 10,000 years – why should we feel compelled to use it all up, especially on poor schemes – in our lifetimes? Why should we saddle our successors with all the unpaid bills?

“The next generation might well be smarter than we are – if we leave them opportunities to do smart things.

“Counties across the state are all now facing requests, to simply extend existing approved expiring development permits that are no longer economically viable until ‘the market improves.’ In almost all cases, they are extending the projects. Is that really a good idea? Admittedly, it saves both the developer and the government the costs of repeating the permit process, but are all those projects really that good? It’s at the least an interesting policy question, and perhaps of particular relevance since we lead the nation in the number of public corruption cases (800+), many of which centered around favors for land deals.”

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