If you have driven around Columbia, SC in the past year then you undoubtedly noticed that Columbia has a ton of new construction happening.  I have personally lived downtown for the last decade and never in that time have I experienced so much construction.  What is causing it?  Primarily it is new apartments, that are at the very least, geared towards college students.  It is no secret that the University is a big part of Columbia, arguably the city's biggest draw. There are no less than seven new student housing complexes that have or will be completed by 2017.  New construction brings a myriad of problems to a city like extra noise, it is an eyesore, and it can affect parking and traffic.  One of the main causes of this boom in new housing is the Richland County Student Housing Property Tax Incentive- Special Source Revenue Credit [SSRC] program.  This program basically gives a fifty percent property tax break for the first ten years that these complexes are in operation (Ellis).  This immediately raised flags for me because the city already has a thin tax base due to all the tax exempt buildings.  The city of Columbia is in a unique situation as it is the home to both the state's largest university and the legislature.  Both the University's and the state government's properties are tax exempt. I had originally planned on arguing that the new construction was not going to be bad for Columbia because there was no need for it, the tax incentive would take away from a tax base that was already thin, and it would take away from the down-home charm of Columbia.  I was also going to argue that Columbia did not have the infrastructure to accommodate all the new residents and that the number of developments would put a strain on already terrible infrastructure.  Unfortunately my research did not support any of my claims.   The boom in student housing will be good for the city of Columbia because the tax incentive has stipulations within that will help with infrastructure and deal with the lost tax revenue, there is a need for more student housing, and growth is necessary for a city to thrive.   

Initially I thought that there was no need for the influx of housing.  The University of South Carolina has nearly 33,000 students and "the university's population has increased by twenty-five percent over the past decade" (Welch).  There are at least five colleges or universities in the Columbia area not to mention the for profit colleges that are springing up.  There are over 50,000 students in the Columbia area (Education).  This number is only going to grow because higher education has become a necessity.  We are all aware that a college degree often leads to more career earnings or most of us probably would not go.  So there is definitely a need to go to college which then creates a need for more housing.  According to an article by Natalie Pita in the Daily Gamecock the new housing complexes will add somewhere between four and five thousand beds (Pita).  When the numbers are broken down it is easy to see how there could be a need for the complexes and it will not be too many for the city.  When it is broken down into how many actual beds it will add it seems small compared to the number of students.  Based on the number of current students in the area and the projected growth there is a definite need for housing.  The fact that there are seven new housing complexes seems excessive and if there is a need for more student housing why doesn't the university build more dorms.  According to an article by Gray Berkus, there is a trend in outsourcing student housing to the private sector (Berkus).  Public funding is being cut to universities so they are looking at more cost effective ways to house students.  By privatizing at least part of student housing the University is able to cut costs and focus on other things that affect the student's experience.  There are several examples of schools moving completely to this model.   In 2000, Western Kentucky University sold its entire stock of residence halls to a private foundation, "the foundation then issued $65 million in bonds that paid off the debt on the facilities, relieving the university and state of the debt liability associated with the buildings" (Berkus). This proves that this system can work and the article goes on to add that there were several ways in which the university still could retain control over student affairs even in these complexes.   The article continues to point out that this trend is being helped out because more and more universities are looking to cut costs without cutting out the experience.  The benefits are not just for the universities though.  

The new construction creates a lot of options for students choosing where to live.  The options could allow the university, or any of the other institutes of higher learning in the area, to attract different types of students than they had before with traditional student housing.  This helps the market because it requires the older complexes to either reduce their rates or to renovate so that they are as nice as the new complexes.  The competition will be good for both the city and students.  The new construction will create more competition and the older places will have to adjust their prices accordingly.  The choices are important for students because every year it gets more expensive to attend higher education.  The amenities that these new developments have help to lure new people to the university.  No longer are you stuck with two or three old dorm choices; you now have the opportunity to live on Main Street or the Vista.  Young people today want options and they don't want dorm living.  The amenities offered at these new residences include workout facilities to rooftop pools and outdoor movie theatres.  I think private developers will be able to follow and keep up with the trends in student housing better than the university will.  It wasn't too long ago that the rage in student housing in Columbia was the town-home style.  Apartment complexes like Copper Beech, The Retreat and The Woodlands are no longer desirable to some students and is now being replaced by high rises closer to downtown.  Students no longer want to live so far away from campus and while most of these new students probably will not walk to class they will at least have that option living closer to campus.  The university would have no shot at keeping up with these trends because it would not have the budget to renovate nor would it need to because it would just be the option you had to choose from.  By allowing private developers to take a portion of this market it will alleviate some of the burdens that running a residence hall causes.  

Another benefit of outsourcing student housing is that the city could benefit from new tax revenue.  If the University built its own student housing the city would receive no property tax because of the University's tax exempt status.  The University of South Carolina is not the first university to partner with private developers nor is Columbia the first city.  University of North Carolina at Charlotte has seen the benefits of working with a private developer when they were creating there campus in Charlotte's first ward district.  The partnership helped UNCC because they were able to use the skills of the private developers.  Even though it is a relatively new thing "there are developers who specialize in partnerships with universities who can offer a wealth of knowledge in determining the best structure for each unique situation" (Joyner).  The developers are able to help universities in a wide variety of ways including access in utilizing third party financing and just there general expertise with managing projects of this size efficiently.  In the case of UNCC the partnership created what has become their campus in the first ward and is an example of how the projects have the ability to create projects that benefit everyone involved (Joyner).  In this example the private developer, the university and the city all benefit. 

An issue I had with all of the new housing complexes was that they were lured here with a tax incentive and why wasn't the University just building dorms.  The Richland County Housing Property Tax Incentive- Special Revenue Credit [SSRC] program was created to lure developers to Columbia by providing a 50% property tax cut for the first 10 years of operation (Resolution).  If that was all there was to it then I would be completely against it because the city of Columbia is already lacking in taxable property downtown because of the tax exempt entities (like state government and the University of South Carolina buildings).  According to the Resolution that enacted the SSRC program the developments must also have a "minimum private investment of $40,000,000" and "pay a minimum tax bill of $750,000 per year in annual property taxes" (Resolution).  These provisions ensure that the city does profit from these deals.  (Without the tax credit I do not believe the city could have lured private developers to downtown Columbia.)  Because of the university's sustained growth one might think that developers would already be lured to Columbia without the tax credit.  But due to a variety of factors including the economy, I believe developers needed a little more reassurance about Columbia.  The alternative to the tax credit would be that the university would have to spend money to build new dorms.  While this seems to be a viable option, it would only further hamper the tax base of Columbia because University of South Carolina buildings are tax exempt and could possibly cause the tuition rates to hike to help pay for the cost of another new building.  As of late 2015 the council reported that it was up to 3.1 million dollars in tax credits for the complexes that had been approved for the program and that construction had completed (Ellis).  According to Mayor Steve Benjamin, "This tax cut is going to yield hundreds of millions of dollars in taxes for Richland One, the county and the City of Columbia" (Kuenzie).  Although it is hard to imagine a tax cut creating an influx in tax revenue, an article by Jack Kuenzie points out that "much of the real estate where these projects are being built has provided modest tax revenues until now" (Kuenzie).  For example the area where the Greyhound Bus station was produced roughly "$25,000 a year in property taxes", but when the "huge student housing development opens at the site, that tax bill could skyrocket to $650,000"; or roughly 26 times what the property had been generating (Kuenzie).  That is after the tax break has been included and that is just one of the developments.  I think it is easy to see that the city comes out a winner in this situation.  The argument against giving the tax break was that it would already hinder a strained tax base and as a result city infrastructure and really the Richland County school systems would be the real losers in the situation.  Instead the tax credit has lured developers in to areas that were either underused or just being wasted.  Another example of this is the complex on the corner of Blossom and Huger Streets.  Before the area began being developed the area was used for baseball parking.  Now, even with a tax break, the property stands to make substantially more for the city as a new student housing development.  This is primarily due to the stipulation in the SRRC that the "use will pay more in taxes after all credits have been applied than any other likely use of the property" (Resolution).  This is an important part of the resolution because it somewhat guarantees that the city isn't losing money.  Another stipulation of this resolution allows the Columbia City Council the right to review and approve or deny any other assistance that may already be available to a particular project (Resolution).  This is important because some of the projects are planned for areas that have other types of tax credits available to them and this allows the city to have the final say in whether or not a development can double dip or not.  

The last major concern I had for luring developers with a tax break was that there was no mention of parking and we all know that parking is a nightmare downtown.  The SRRC also had stipulations in place intended to alleviate parking issues.  For a development to be approved for the program, the developers had to have a plan in place that mandated "structured parking and infrastructure with no use of public funds used in construction costs" (Resolution).  This stipulation really sells the idea of the tax break as feasible.  The city is basically saying yes we want you to build here but we want you to do it.  By forcing the developers to provide and pay for their own parking structures, it immediately helps to clear up the concern of infrastructure.  It also alleviates that problem from the state now and in the future.  The SRRC program looks like a slam dunk.  It has lured a lot of private money into the city.  As of late 2015 the city estimates that the new housing complexes represent approximately a 225 million dollar investment.  And it is an investment that will keep giving in the long and short run.  This is because it will help to add more people downtown which will mean more money is being spent downtown.  And because of the infrastructure stipulation in the SRRC taxpayers in the future will not be left holding a bill for these new developments.  

The last major concern I had for these new developments was that the infrastructure of Columbia would be unable to support the new construction and that the new construction could cause Columbia to lose some of its appeal.  The parking and infrastructure part of the resolution alleviated my fears that taxpayers would end up doing heavy lifting for these new developments but I was still concerned about how the city would deal with traffic and developing the rest of the things that are required for student housing.  Things like more places to eat, shop, be entertained.  As far as traffic is concerned the city is already planning several road projects in the area and several more are in public debate stage.  According to Sarah Ellis at the State paper there is a plan to widen bluff road, from I77 to Rosewood Drive, to 5 lanes and there are plans to do something to Bull Street to help alleviate the traffic that is expected to be caused by new construction (Ellis).  I have also heard rumblings at Olympia Community meetings that the new development on the corner of Huger and Blossom Streets wants to begin looking at ideas to build a way to go over the railroad tracks at the end of Huger Street [Which would be amazing].  The plan is being proposed by the new development because even they see a need to create a way to not be blocked in by a train.  These are just a few of the proposed plans to help with the infrastructure in Columbia.  Several of the new developments are more than just residence halls.  They are bringing new retail space all over town.  In Olympia at the Mill at Whaley they added a closer Village Idiot for those Sunday hangover pizzas and a White Duck Taco.  The one true private developer and University partnership is adding 30,000 square feet of retail space over by the Colonial Life Arena.  One of the most positive signs is all of the new restaurants and retail stores that are starting to migrate downtown.  Another positive sign is that a lot of the empty or underutilized land downtown will become more expensive and scarcer.  According to Fred Delk, of the Columbia Development Corporation, "the prices are already hitting two million dollars an acre" (Kuenzie).  This is important because it will allow the city to start to look cleaner and it will also cause an increase in the value of the rest of the property downtown as evidenced by Delk's quote.  There won't be just empty lots and some of the abandoned buildings will be renovated because developers will see the growth that is occurring.  According to the article by Kuenzie "more people downtown also means more demand for all kinds of services and infrastructure, like food stores, for instance".  This change is already somewhat apparent with the addition of national chain retailers like Urban Outfitters.  According to an opinion article in the Daily Gamecock the benefits to these new developments will be immense.  "Living within walking distance means forgoing parking fees and making a car an option rather than a necessity" (Projects).  While this may be a stretch, the allure of creating a more city environment is appealing and it could go a long way in helping Columbia retain some of the graduates from the area.  The thinking behind this is if you like where you live you are more likely to contribute and participate in your community.  "This process of putting down roots will induce students to think about staying in the city after graduation, instead of looking elsewhere for opportunity" (Developments). Trying to keep more of the graduates here is another way to help Columbia in the long run as well. 

One worry I came across in my research was that this might lead Columbia to over gentrify and it would take away the charm of Columbia.  I think that this worry is unfounded.  While this could potentially be something that Columbia needs to deal with the time is not now.  None of the new apartment complexes are being built in locations that were previously occupied.  Instead these new developments are going in places that are currently vacant or unoccupied.  Columbia needs to create a city before it really needs to worry about gentrification.  The money that new developments bring in will go a long way in helping the city's vulnerable and lower income residents by having more money in the tax pool.  It also will move some of the students who occupy houses in Rosewood and Olympia back downtown which will free those areas back up to residents.  The new construction will help the charm of the city.  The locations of these new developments will put people in parts of down town that are being underused.  These new developments will allow residents to utilize areas like the river and Main Street.

Originally I had planned on arguing that all the new housing developments were not going to be good for the city at all for reasons like extra traffic, extra noise, more people downtown which might create lines and make parking even more difficult and because I did not truly understand the tax credit.  But now that I have done the research I have come to the conclusion that while the new additions may not help me they will be extremely beneficial to the city.  While traffic and no parking may seem like a big deal they are really just a nuisance and are really worth it if it ends up helping the city become better.  A recent trip to Charlotte also put in perspective what construction, traffic and parking problems really look like.  And as far as extra noise goes I was recently in Five Points for happy hour and all I heard were train horns and emergency vehicle sirens.  At least construction crews have the decency to end work when the sun goes down.  These nuisances are incredibly minor if that is all it will cost taxpayers to help ensure the longevity of the city of Columbia.  The new housing complexes will help to continue the cleanup and revitalization process that is trying to occur in downtown Columbia.  The housing boom will help to accomplish that by providing more places to live in the city, by creating a bigger tax base for the city by creating an environment in which developers want to invest their time and money. Overall these new developments seem to be a step in the right direction for Columbia and according to Delk we are going to see several more years of sustained growth in the downtown area (Wilkinson).  According to Mayor Steve Benjamin "everyone wins" and that "it really is about creating a real tax base in the city so that we can prosper for the next 50 years" (Ellis).  It is important to note here that the tax credit (which I believe is responsible in large part to the sudden growth) was only temporary.  The tax credit can no longer be applied for and it only lasts for 10 years.  I think it is important that the city has the foresight to see into the future and see the good that can come out of this.  Rhetoric like this and the facts about the tax credit swayed me into believing that these projects could be the start of something bigger unlike the failed first Innovista Project.  Even though I came into this assignment completely against the new construction; through my research of the issue I was able to realize that I was being short sighted in my view on the new developments. Perhaps this is Columbia's "if you build it they will come" moment.

