Has Albemarle County Reached its Optimal Size?

Albemarle County has a proffer policy in place in which developers pay fees when rezoning is necessary for residential property development.  These fees are intended to raise money for new infrastructure whose consumption increases with population.  Such infrastructure includes schools, roads, and libraries. The concept behind proffers is that as developers build houses, population increases and puts strain on existing infrastructure.  It is this strain that the proffer system attempts to combat.  As of July 2013, Albemarle County requested that developers “proffer” $19, 753 per single-family home, $13,432 per townhome, and $13,996 per multifamily unit.  Essentially, this means that developers that rezone must pay an amount to the county on top of the other costs of building each residence. 

It is possible that the proffer policy is aimed at keeping Albemarle County at an optimal size, a concept explored in Tiebout’s Theory of Local Expenditures.  In his theory, Tiebout assumes that there is an optimal size for communities and these communities make every effort to move to that size.  These efforts by the community can involve policies to encourage or discourage movement into the area.  The proffer program, by imposing additional costs on developers, appears to be a policy aimed at discouraging further movement into certain parts of Albemarle County.  Developers will be less likely to rezone to build housing and will thus build fewer housing units if they expect to pay hundreds of thousands of dollars in proffer costs.  Those developers that choose to rezone despite the proffer expectation will likely attempt to pass off part of the cost to the consumer.  This will result in a higher price of housing, which would likely lead to a decrease in the quantity of housing demanded.  If this occurs, the county will be more likely to remain at the size it believes to be optimal.