The Infrastructure Challenge
VIEWPOINT by Daniel K. Winton
Orange County is a victim of its own success. Orange County is now the second most populous county in the State, and one of the richest counties in the United States. But, its infrastructure has not kept pace.
By infrastructure, I mean roads, airports and housing, the infrastructure which allows developers to develop and businesses to operate. Without a viable infrastructure system, businesses may well look to migrate to other states (and countries) that do provide such a structure, and the demand for new development will decrease significantly.
Turning first to housing, there is an affordable housing crisis in this county. A crisis may potentially influence locations decisions of businesses, causing some to make the decision to relocate elsewhere, and some not to consider even locating here.
According to the California Association of Realtors, in 2000, only 27% of households in Orange County could afford the median priced home, far below the U.S. average of 53%. According to the published Housing Affordability Index, Orange County is less affordable than all other Southern California counties, and is much less affordable than Boston, Seattle, Austin and Minneapolis.
The rental housing market is even worse, with Orange County behind all Southern California counties, as well as Seattle, Minneapolis and Austin.
What does this mean? Orange County must look east to Riverside County. If Orange County does not address this issue, businesses will go to where their employees can buy homes, including areas surrounding Seattle, Minneapolis and Austin.
As anyone who has spent time on Southern California’s freeways can attest, congestion is again on the increase. In Orange County, commute times had remained relatively stable from 1992 to 1998, but from 1998 to 1999, the two-commute time increased from 65 minutes to 74 minutes, which is now roughly as time-consuming as in the Inland Empire.
The commute on the 91 has increased to the point where the Orange County Transportation Agency is in negotiations to pay to the current operator of the 91 toll road a significant sum in order to add additional lanes. Of course this is only a stopgap measure. Since you can only add a finite number of lanes, additional access routes between Orange and Riverside Counties must be developed.
The Regional Transportation Plan prepared by Southern California Association of Governments includes as toll corridor projects an extension of SR 241 (the current Eastern Corridor) to Riverside County and a toll corridor from Orange County to the I-15 by 2010. Such corridors will provide the needed access to allow employees in Orange County to buy homes in Riverside County, and still have a livable commute.
Air transportation must also be addressed. SCAG predicts that air passenger demand will nearly double by the year 2025, and that air cargo demand will triple. How is this increase in demand to be served? The urbanized airports in Southern California are already at 73% capacity, without any ability to expand significantly. This situation was made only more acute, now that it appears that the conversion of the El Toro Marine Air Station has been taken off the table.
There are really only four alternatives, none in Orange County: Southern California Logistics (George AFB), March Air Reserve Base, San Bernardino International (Norton AFB) and Palmdale Regional Airport, which represent 34,000 acres for airport capacity development. This is to be compared to the existing commercial airport system acreage (LAX, Ontario, Burbank, Long Beach and Orange County) of 7,900 acres. For comparison, Chicago O’Hare Airport is 7,700 acres and Denver International Airport is 34,000 acres.
Unless these four alternatives are developed within the next decade, the projected demand in air travel cannot be met and companies dependent on air travel will choose to look elsewhere.
A new corridor linking Orange County to the I-15 will not only allow access to affordable housing, but it will also allow businesses in Orange County easier access to airports at March, Ontario, San Bernardino and Southern Logistics.
For Orange County to remain viable as an alternative to businesses when they are looking to relocate, Orange County must have an infrastructure system that allows the employees of those businesses to have access to affordable housing within a reasonable commute to the office, while also allowing those businesses to access state-of-the-art airports.
This goal can be accomplished, but we must start now.
Winton is a partner in the Irvine office of law firm Snell & Wilmer and chairman of the regulatory committee for the Orange County Business Council.
