Integrate the state's growth criteria into discretionary funding decisions
There is no better way to determine what an administration values than to look at where and how it spends taxpayer money. If a state is concerned about the challenges of growth and development, the state's discretionary spending should support its development principles and goals (see Policies #3, Establish a set of state development principles and #4, Establish a set of measurable state development goals, in this section). One effective way to do this is to use a scorecard system that allots discretionary funding on the basis of how well projects follow the state's growth principles and meet state goals. The Governor can direct the Office of Smart Growth, growth sub-cabinet, or other appropriate agency to develop a scorecard that integrates the state's development principles and goals into the state's discretionary funding programs. Discretionary funding programs support infrastructure and capital investments, which in turn affect the location and character of growth. Importantly, states can spur local reform of zoning and other land use regulation/management policies at the local level by providing — or withholding — state discretionary funds. Integrating growth criteria into these programs can encourage growth in existing communities, reward communities for policy changes that support smarter growth outcomes, and make sure that state investment is consistent with state development objectives.
The first step is to ask the growth sub-cabinet, Office of Smart Growth, or other appropriate agency to translate the state's development principles and goals into criteria that will be used in evaluating funding requests. These criteria should be used to formulate a mock scorecard. The mock scorecard can be used to get the public involved and get local buy-in through a process to refine, finalize, and institutionalize the scorecard. As part of this process, staff will also need to determine whether the growth criteria will supplement or replace existing program criteria.
While criteria are being developed, all available discretionary funds should be inventoried in such areas as housing, economic development, infrastructure, water and sewer, schools, transportation, and recreation. This inventory should include not only state funds, but also federal funds, passed through the state, over which the state has discretionary control. The inventory typically can be completed in two to three months.
It is important that local government officials not see the growth scorecard as an insurmountable barrier. Therefore, it is crucial to educate community leaders so that they understand the scorecard, its purpose, and how it can be useful to them. In addition, the state should provide targeted technical assistance to local governments, especially to help those that need to improve their scores to gain access to state funding. The scorecard provides an important incentive for communities to avail themselves of technical assistance programs that are provided or supported by the state, including technical assistance to help local governments that wish to revise their zoning, building, subdivision or other codes.
- Massachusetts' Commonwealth Capital Program
In 2008, $500 million in low interest funds and $50 million in discretionary grants were distributed through the Commonwealth Capital Program using the commonwealth capital scorecard to evaluate funding requests against a set of smart growth criteria. The resulting score counts for 30 percent of the decision on whether they get a grant or loan in the Commonwealth Capital "family" of grants and loans. The checklist is kept as simple as possible and is filled out electronically.
To help local governments with low scores, technical assistance was made available through the Internet, as well as through site visits. Scores were posted on the Internet, as was all education and support material, to make the process as transparent as possible. Relevant state funding programs were identified on the Internet and consolidated. As a result, many towns without professional planning staff discovered programs for which they were eligible but did not know existed.
— Massachusetts' Commonwealth Capital Program
- Massachusetts Chapter 40R and 40S
The Massachusetts legislature adopted a smart growth zoning statute (Chapter 40R) that provides incentives for local governments to establish smart growth zoning districts. Smart growth zoning districts must fulfill certain density, affordability, and location requirements. Communities receive some incentives upon making zoning changes and receive further incentives based upon building permits issued, which ensures that the funding is supporting actual implementation, as well as planning and zoning. The legislature also enacted Chapter 40S, which created a Smart Growth School Cost Reimbursement Fund to compensate schools for additional costs incurred due to more compact development in the smart growth zoning districts.
— Massachusetts' Chapters 40R and 40S