Slow. Curve Ahead.

There’s an interesting juxtaposition of opinions in today’s Indianapolis Star.

Steve Lains, the CEO of the Builder’s Association of Greater Indianapolis writes that growth is good, and that slowing growth would have a negative impact on the local economy. He does his best as the mouthpiece for unbridled growth to justify how and why we ought to continue to turn cornfields into subdivisions as fast as we can.

He says, “In Central Indiana, for every 100 new homes built, the one-year impact is $10 million in local income, $500,000 in local taxes, and 222 local jobs.”

When will anyone bother to ask the most obvious question? AT WHAT COST, STEVE, do we build thousands on thousands of new houses in the fringe?

Let’s get VERY clear here. The local population is not growing at the same rate as new home construction. And the population growth in Central Indiana is not proportional to the population growth for the State as a whole. Period. According to INcontext, a State of Indiana and Indiana University Partnership for Economic Development, the Central Indiana metro area is growing at 4.6 per year. Hamilton County leads the list with a 13%+ rate. Meanwhile, Marion County is basically flat, adding just 3,000 residents in 2002 and 2003. All that is counter balanced by the fact that Indiana as a whole grew at a rate of less than 1% according to the Indiana Business Research Center.

People, this isn’t rocket science. If the state’s growing at less than 1% as a whole, but the Central Indiana region is growing at 4.6% rate, the region isn’t getting its population from outside Indiana by and large. Most of our growth is from within the state and from what is called “natural” growth. You know…people making babies.

From a housing perspective, we’re not building homes for people who are just moving to the area. We’re building and filling houses in the suburbs for and with people now living mostly in Marion County. The population boom in Noblesville, for example, isn’t fueled by people moving here from Chicago or St. Louis or Dallas. It’s people moving out of the city in search of good schools, cul-de-sac street hockey courts, lower crime and a subjectively better quality of life.

To some degree, too, they’re moving from counties that are a step or two further OUT geographically. Madison, Delaware, Putnam, Henry, Owen, Brown, Bartholomew and Monroe counties are rapidly shipping people into the region. Leaving the small, rural areas and schools for the big city. Bye-bye Lapel, hello FIshers. See ya’ Mooresville...hello Brownsburg. Edinburgh? Try Greenwood.

OK, Mr. Lains, we’re adding jobs and tax base and income…but we’re taking jobs and taxes and income from our nearest neighbors. How’s that for Hoosier Hospitality?

Who exactly, then, is filling those houses in the townships of Marion County? Actually, NOBODY in many cases. For extended periods - and in alarming numbers - (anecdotally reported to be upwards of 30% of the time), these homes are sitting empty. In historically fast-selling neighborhoods like Broad Ripple and Meridian Kessler, houses are sitting unsold. Months pass and the houses sit. Mortgage payments stack up and the houses sit.

Why is that?

Perhaps it’s because humans always want newer and better. There’s absolutely nothing wrong with that. But the supply of newer and better is outpacing the demand for less new and less better. People can now move – thanks to good credit, low interest rates, crazy over financing or some combination thereof – sonner than they might otherwise choose to.

So they up and move, taking their kids and cats and dogs and cars and belongings and jobs and taxes and income across the County Line.

Yahoo! Look, Maude! We've got city water and a walk-in closet!

But now we arrive at the next fork in the proverbial road. Do we slow all this growth down? According to some Noblesville city leaders (the fastest growing part of Hamilton County, by the way), YES!

There’s heated discussion going on in Noblesville on how to grow more smartly. Should they raise the architectural and design standards? Lower density requirements? Choose quality over quantity?

It’s on their minds. And I’m glad for it. At least it’s being discussed. That in and of itself is a change.

The “off the record” talk among many in my business is that these councils are so heavily backed by builders and developers and their huge fortunes that it’s all an act anyway. I for one hope it isn’t.

What’s the alternative? Grow as fast as you can build (and C.P. Morgan can build a house in 49 days. More square feet. Less wood.) and add to an ever-increasing burden on schools, roads, sewers, water systems, police, firemen and hospitals. New home building is outpacing the community’s ability to provide adequate infrastructure upgrades. The taxes go up to support the growth. And now people can afford less house than they otherwise might have been able to because the taxes are so astronomical.

Brownsburg is a prime example, too. In Hendricks County, this sleepy little town is also experiencing explosive growth. And insanely high property taxes. How does $500 a month on a $250,000 house sound? Painful is how it sounds to me.

Until residential growth is slowed and valuable commercial growth can catch up to help support the tax base, these communities are doomed to suffer from stifling tax burdens on homeowners, congested streets, overflowing schools, clogged storm drains, flooding and all the ills that “newer” and “better” and “now” bring with them.

Slow down, folks. There are dangerous curves ahead.