Thursday, March 24, 2005

Highway Sues Mall

The Illinois State Toll Highway Authority is suing Chicago Premium Outlets in suburban Kane County. At issue is the level of traffic generated by the mall and an agreement between the developer--Simon Property Group [one of the largest shopping mall developers in the country]--and the Tollway that Simon pay for improvements to facilitate traffic. The Tollway is seeing traffic back up on the off-ramp, generating safety and congestion issues. According to the article they are suing for reimbursement for $5 million that they have spent to improve access to the mall.

On the one hand, one wonders why local planners in Kane County and the Tollway Authority couldn't anticipate these problems since they were pretty much guaranteed by the plan: when you situate a large regional mall next to a restricted access highway, in a low density area, with no alternative forms of transportation, traffic levels are going to increase. Of course, the agreement on which they are suing was supposed to require that Simon pay for the improvements.

Aside from the fact that land use patterns in this typical suburban setting made this type of conflict pretty much inevitable, one must also look at the role of large publicly-traded real estate developers in promoting a sprawling development that depends on massive public subsidies.

Simon seems to demand public money for many of its suburban ventures. In 1999 they received $42 million from Orange County, California for the re-development of Mission Viejo Mall. Currently, they are demanding that the City of Fort Worth, Texas finance road improvements for a planned mall in the northern Alliance area.

Simon's expectations of public subsidies extends into its plans for constructing its corporate headquarters in downtown Indianapolis in the Capitol Commons Plaza. Space in the high-demand and prestigious plaza--which contains the Indiana State Capitol--was actually given to the well-connected firm.

One can recognize the challenge that many municipalities and government agencies may have when dealing with large developers like Simon who routinely wait for litigation before complying with various laws. For the developer, legal challenges are assumed as part of their costs of doing business. Unfortunately, people who live in affected communities have to live with the consequences of companies' exploitation of poor planning.

In Kane County, residents are taking action to preserve their community with a referendum to increase the amount of protected open space in the county. This protection won't solve all of the county's problems, but it certainly represents a new questioning of 50 years of dominant methods of development.