Have You Met This Guy?

Image credit: Ruthson Zimmerman on Unsplash.

I periodically attend public hearings where a development proposal is up for approval (or denial) by local elected officials. It was at about the 10th such hearing I attended in my current city where I really noticed him: "Hey, it's that guy again.” 

That Guy is a land-use attorney. His job is to represent clients who are trying to get a development project approved that requires some sort of special permission. Need a variance or other special exception to the normal zoning rules? A change in the zoning for a property? Putting together a more elaborate master-planned development, which bundles together a lot of rule changes in one request? Negotiating complexities involving wetland mitigation, historic preservation, impact fees, mandatory traffic studies, easements, transfers of development rights? (If you don't know what all of those mean, don't worry: that's kind of the point here.) 

For any of the above, That Guy is your guy. He's not just any land-use attorney. He's the one you want if you're in the big leagues. When virtually any development of significant size or scope is on the agenda, That Guy seems to be there at the meeting as the developer's lead attorney. He's reliable like death and taxes.

“And now the applicant's counsel, [That Guy's Name Redacted Because It Doesn't Matter], will have 10 minutes to deliver their presentation."

He steps up to the podium and launches into his PowerPoint. That Guy is very good at his job. He's polished; he's prepared; he's amiable and breezy. The reason so many clients use his services is that he knows the zoning code inside and out. He knows it better than the city planners know it: every technicality, every loophole. Certainly better than the elected officials know it. He's been in this work a long time. He might have a planning or engineering degree in addition to his law degree. He probably worked in the public sector for a time.

(It may go without saying, but let's be clear that That Guy need not be a "guy," or a man, or fit any particular demographic type. Anybody can be a That Guy, and there are That Guys in every realm of human experience. To be a That Guy is simply to be a human archetype.) 

Our particular That Guy is a principal in the firm that bears his father's name, which is also his name (he's a “III”). Their office is in a prominent building not far from City Hall. Their website boasts that, in addition to his "nationally recognized practice" in all areas of land-use law, he is "a regular speaker at growth management and land use conferences and has published a number of articles" and "has actively served his community as a board member on local civic and charitable organizations."

That Guy is in the know. He knows people, and people know him. At some point the meeting will enter a brief recess (because there are hours worth of speakers lined up for the public comment period), and you'll head out to the lobby. You'll see That Guy chitchatting with reporters.

Perhaps more surprisingly, you'll see That Guy chitchatting with one or more of the firebrand community activists who are there to rail against the developer (his client) as a money-grubber ruining the community's quality of life. I've seen this happen firsthand. They all know each other. The activists have been going toe-to-toe with That Guy for years. They've probably met his kids. There's a grudging respect there. It's not that the issue doesn't have real stakes; it's just that it becomes like a sports rivalry after a while, where you've grown to kind of like the other team's captain.

That Guy might prevail, or he might not. He usually does, but some projects really are let's-see-what-we-can-get-away-with long shots. And elected officials are, at the end of the day, independent-minded and answerable to a range of constituencies.

This isn't a conspiracy, and it's not corruption. What it is is something less obvious but just as harmful. 

That Guy as a Tax on Small-Scale Development

What does it mean if your community has a That Guy? That Guy is an indicator species: his presence tells you something important.

Fundamentally, it tells you that the system you're using to regulate development is too complicated. The reason there's a market for That Guy is that if you want to build something, you'd better have a lawyer. And if you want to build something big, you want the best lawyer. A billionaire trying to minimize their tax liability isn't hiring the same CPA who just did my taxes; I'll tell you that.

“What does it mean if your community has a That Guy? That Guy is an indicator species: his presence tells you something important.”

There's a good rule of thumb about bureaucracy: the more complicated a process or set of rules is, the more it will tend to favor well-connected insiders, or people with greater resources over those with fewer. (This is certainly true of the tax code, where the very wealthy find and exploit loopholes unavailable to the rest of us.) This rule of thumb applies to development review.

Make the rules simple and predictable—the zoning code tells you what you can build, and you can build it as of right—and the smallest developers with the shallowest pockets can play. Make the rules complicated, and the ante to participate gets much higher. The little guy can't enter the game anymore: the ”return on brain damage” (h/t R. John Anderson) for trying to navigate a modest-sized project through the system is no longer worth it. 

If you know your project has to run a gauntlet of public hearings, that means either having a rock-solid grasp of whatever obscure rules may trip you up, or hiring an expert who does. All this amounts to a transaction cost, or a tax on development that falls most heavily on the smallest projects.

Worse is the effect that Planning via That Guy has on the way the public perceives the development review process. What I've learned from talking with community activists, many of whom have acquired a deep understanding of the zoning code themselves through many hours of uncompensated study, is that they see development as a perpetual push-pull battle between "The Developers" and "The Community." When you see, over and over, controversial proposals get approved and built after a bigshot attorney lawyers the details to death, you start to think, "Hey, this is a rigged game, and the way to get better at it is to rig it for the public."

This leads to a culture of escalating regulatory complexity, as the community tries to extract whatever benefits it can from developers by imposing conditions on everything they want to do, and developers, in turn, just hire even better, smarter lawyers.

It's a That Guy full employment program. At its most absurd, you get things like the conditions imposed on the builder of a 425-unit apartment complex in San Bruno, California in 2019:

Developer Mike Ghielmetti... spent $3 million on the approval process, repeatedly altering the project at 601-611 El Camino Real at the behest of residents and city staff. He agreed to add car and bike parking, a 40,000-square-foot “upscale” grocery store, 64 affordable units, street improvements and a community meeting space. He also pledged to pay $10 million into the city’s general fund to offset the increase in demand for public services from the new residents.

The San Bruno project was still rejected, leading the developer to invoke state law. A lot of lawyers were well paid every step of the way.

This escalating cycle leads to:

• Fewer small developers, and more big corporate developers.

• Less filling-in of vacant urban spaces with productive use, and more giant subdivisions on the edge of town.

• Less affordability, as the costs of regulatory compliance and delay raise rents and kill good projects.

• Stagnation of neighborhoods where there might be a market for small-scale revitalization, but there isn't a market for large-scale redevelopment.

I don't have anything against That Guy. He seems nice, he's certainly very smart and competent, and I bet he and I would have a great conversation about land use over beers.

I just don't want the way my community grows to be dependent on people like him.

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