Can we make smart growth a reality in San Diego? Only if there are sufficient dollars to make it happen. Here is some "insider baseball" on the dilemma that interest groups in our region face when it comes to financing smart growth. The more I think about this and watch the dynamics around smart growth in San Diego, the more I am reminded of the "prisoner’s dilemma" of game theory. This is the social science theory, popularized through discussions of nuclear brinksmanship, which describes the dilemma faced by those who should collaborate, but have to decide whether to do so when they are uncertain they can trust one another.

Exec. Dir. Chuck Nathanson

In a sense, the terms of this "game" have now been set with the decision by SANDAG to delay a vote on TransNet reauthorization until at least 2004. Between the summer of 2002 and November of 2004 a game is going to be played to see if the various interest groups in the region can get what they want out of a smart growth financing package. As in the Prisoner's Dilemma, the best move for everyone would be to cooperate, but someone may choose to defect because of their suspicions about the others' probable behavior.

As I see it, there are now four key players in the game:

The Developers - they want a financing package that will help them to build new projects, but they also want a package that will help pay for land acquisition for lands that fall under the Multiple Species Conservation Plan (MSCP). They are extremely suspicious of the environmental community, who they believe will devote discretionary resources first to acquiring new habitats in the unincorporated part of the County, which are under higher risk of near-term development than the habitats within the urbanized area covered by MSCP.

The Business Advocates - they want a financing package that will facilitate near-term relief from traffic congestion and are suspicious of strategies that put too much money into habitat preservation or unproven transit systems. They also want to generate new money that will help get housing built in the region, particularly in the central city. But they don't want to be perceived by their own members as supporting a tax increase that disproportionately impacts business.

The Environmentalists - they want money for habitat acquisition and open space preservation and also to fund water and sewer infrastructure improvements that will increase the quality of our water and reduce beach closures due to sewer breakages/spills. They also want a financing regime that discourages sprawl, in order to preserve habitats in the future and reduce pollution from urban runoff. With a few exceptions, I don't think they care about the cost of housing in the region.

The Citizen "Watchdogs" - they want any new money generated as part of a financing package to be spent well and they want proof, up-front, that new public investments will be tied to real performance criteria. I don't think they have any specific priorities within the three main quality-of-life issues (habitats/open space, housing costs and traffic congestion/mobility).

Consider the dilemma that these players confront:

1) There isn't enough money in a TransNet reauthorization to get everyone what they want, but TransNet needs to be the backbone of a smart growth financing package, so it should be renewed and the resulting funds should help to support the needs of these competing interests in some manner.

2) Based on current polling and the mood of the public, if any of these major interest groups opposes a TransNet reauthorization ballot measure it will fail, so there should be a strong incentive to cooperate.

3) The logical way for everyone to cooperate would be to develop a jointly endorsed financing package that gets everyone most of what they want, and to implement that package in tandem with reauthorizing TransNet.

4) Preliminary polling suggests that combining multiple functions or uses of funds under TransNet reduces its appeal to the voters. But our work, including the Choice-Work Dialogue exercises, suggests that citizens can "connect the dots" and will embrace an integrated strategy. But again, it's only going to work if no major interest group is campaigning against the initiative.

Recent news suggests that these issues must be resolved in the next two years. San Diego's water quality has fallen to such low points that we are at risk of coming under direct Environmental Protection Agency (EPA) sanction. We are rapidly approaching the point where home ownership will be an option for less than a quarter of San Diego's households. And MSCP will fall apart if new funds don't soon emerge to spur public acquisition of habitat. Plus our own research (highlighted in this issue of the Report) notes that declining quality of life is undermining the competitive advantage of our regional economy.

In particular, I think regional corporate leaders could make an extraordinary difference in this game if they were to endorse an integrated approach to financing a more sustainable pattern of growth.

So let the games begin....