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(Israel Sundseth/Unsplash.com)

Urban sprawl costs the U.S. economy more than $1 trillion annually, according to a new study by the New Climate Economy, a global commission on the economy and climate chaired by Felipe Calderón, a former president of Mexico. The report estimates that Americans living in sprawling communities bear at least $625 billion in direct incremental costs and impose an extra $400 billion in external costs on governments, businesses, and other households.

This report, Analysis of Public Policies That Unintentionally Encourage and Subsidize Sprawl, was written by Todd Litman of the Victoria Transport Policy Institute, for the New Climate Economy in partnership with LSE Cities. The study estimates that providing public infrastructure and services costs on average $750 annually per capita in the most sprawled quintile (fifth) of American cities, 50 percent more than in the least sprawled quintile cities.

This is consistent with previous research published in the New Climate Economy’s flagship report, Better Growth, Better Climate, which estimated that smarter urban growth policies could reduce global infrastructure capital requirements by more than $3 trillion over the next 15 years.

This research, which was also reported on by the Wall Street Journal, indicates that sprawl is bad for public safety and health. Americans who live in less dense neighborhoods are between two and five times more likely to be killed in car accidents, and are twice as likely to be overweight as those in more walkable neighborhoods. Also, research described in the report suggests that smart growth reduces per-capita crime rates by increasing “eyes on the street” and economic opportunity for people at-risk for criminal activity.

Residents of compact, connected communities save more money and have greater economic mobility than they would in more sprawled, automobile-dependent neighborhoods. Households in accessible areas spend on average $5,000 less per year on transportation expenses, and real estate located in smart growth communities tends to retain its value better than in sprawled communities, due to greater accessibility to services.

These communities are also more inclusive for people who cannot drive: they offer easier access to schools, public services, and jobs, and encourage mixed-income communities. Because of these factors, research shows that lower-income children tend to be much more economically successful if they grow up in smart growth communities.

Lead author Litman explains, “Smart growth is not antisuburb. Instead, it ensures that diverse housing options are available and incentivizes households to choose the most resource-efficient options that meet their needs. We are now seeing growth in demand by millennials and the elderly for affordable, compact housing in accessible and multimodal neighborhoods. However, current government policies tend to favor larger, less-accessible homes. . . . Consumer preferences are changing; government regulations on housing should, too.”

Helen Mountford, global program director for the New Climate Economy, says, “Reducing urban sprawl is good for the economy and the climate. For a real-world example of sprawl versus smart growth, compare Atlanta and Barcelona. Both cities have approximately the same population and the same level of wealth per person, but Atlanta takes up over 11 times as much land and produces six times the transport-related carbon emissions per person as Barcelona. And congested, sprawling cities are costly to the economy—for example, through all the hours that commuters or delivery trucks waste stuck in traffic jams.”

Cities can benefit from increased economic productivity, more affordable housing options, more livable communities, infrastructure cost savings, reduced accident risk, improved public fitness and health, increased opportunity for physically and economically disadvantaged groups, and improved mobility options for nondrivers. These benefits are particularly important in rapidly developing cities where resources are limited and a greater proportion of households are impoverished and cannot afford automobiles.

Nick Godfrey, head of policy and urban development, New Climate Economy, says, “Developing countries in the early stages of urbanization can reduce urban infrastructure and transportation costs by learning from the mistakes made by developed countries. Ninety percent of urban growth between now and 2050 is projected to take place in the developing world. By avoiding urban sprawl, developing countries can stimulate their economic growth while avoiding climate risks.”