The theory behind the bill is simple: Housing costs do not end when we sign our rent or mortgage checks. Where we live has other costs associated with getting around: to work, to school, to the grocery store. How much that costs depends on where we live and what options are available to move us from point A to point B.

Given that reality, a true measure of affordability must take into account housing and transportation costs. In 2006, CNT launched the H + T Affordability Index^SM, a web tool that gives a more accurate assessment of affordability by providing homeowners and policy makers the housing and transportation costs for a community.

Just as families need to have the best information before they choose where to live, our state policy makers should have the best information as they invest scarce public resources in housing. With the H + T Index tool signed into law, public officials in five key state agencies will now have the best available tool to guide their investment decisions toward those that will truly reduce the cost of living for working families.

This legislation also positions Illinois as a national leader, making it the first state to create legislation that links housing and transportation affordability to reduce the cost of living for our households. New national priorities that link transportation and housing affordability to the disbursement of federal funds will make Illinois well-positioned to compete for those dollars.

CNT views this as just the beginning. We will work with the five state agencies, including the Illinois Dept. of Transportation and the Illinois Housing Development Authority, to make certain the Housing + Transportation Affordability Index Act will help create better and more affordable housing and transportation well into the future.

Abogo measures the money a typical household, living in a given neighborhood, would spend getting around– including car ownership, car use, and transit use. It also provides the carbon emissions associated with using a car. CNT developed Abogo so that individuals can now measure the true cost and impact of where they live in 337 metropolitan areas in the U.S., in the same way that planners and municipalities have been using the H + T Index to better understand the combined costs of housing and transportation at the regional level, for example.

CNT partnered with the Urban Land Institute and Center for Housing Policy in 2009 to develop the Terwilliger Housing + Transportation Calculators for Washington, D.C., Boston and San Francisco, where consumers can access up-to-date cost data to make informed housing decisions.

Over the next few months, CNT will be refining these tools to help individuals factor in transportation costs when considering how much it costs to live in a particular city. We’re working to calculate better estimates based on the way someone lives now—and to provide information that helps individuals and households make small changes in the way they get around—while saving money and helping to reduce climate impact at the same time.

TRY OUT THE NEW ABOGO TOOL!

As we further refine the calculator, we’re looking for impressions and ideas how to make it most useful. Feel free to send comments to abogo-info@cnt.org. We have also developed an API, so if you’re interested in getting transportation cost information on your website, see here.

This map shows that cities produces less GHG's, per capita, than areas that require more Vehicle Miles Traveled (VMT).

CNT, through our partnership with the Center for Transit-Oriented Development (CTOD), has released, “Transit-Oriented Development and the Potential for VMT-related Greenhouse Gas Emissions Reduction.” This report provides a quantitative analysis of potential greenhouse gas reductions of transit-oriented development from the transport sector.

The research, led by CNT, finds that by living in a central city near transit, the average household can reduce its transportation-related greenhouse gas emissions by 43 percent. The number increases when living near the most location efficient transit zones, which can result in a 78 percent emission reduction.

“This research shows that, in a nutshell, location does indeed matter,” said Scott Bernstein, President of CNT. “Individuals and families that live near transit centers own fewer automobiles, drive fewer miles, and leave a much smaller carbon footprint than those who don’t.”

The report was funded through CTOD’s cooperative agreement with the Federal Transit Administration, and provides more evidence of transit’s role in building economically and environmentally sustainable communities across the country.

“We’ve long known that living near transit can help reduce greenhouse gas emissions,” said Sam Zimbabwe, Director of the Center for Transit-Oriented Development. “This is an important milestone in helping to quantify those reductions, and we hope something that can influence policy and implementation of sustainable communities served by high-quality transit options.”

As a follow-up to the report, CTOD will be working on a toolkit to help communities quantify their emissions reductions and proactively put in place strategies to reduce their carbon footprint, as well as more detailed regional analysis in several other regions around the country.

Download “Transit-Oriented Development and The Potential for VMT-related Greenhouse Gas Emissions Reduction.” (.pdf 5MB)

As we approach the Arch’s 50th anniversary, the “Framing a Modern Masterpiece” competition, coupled with federal dollars, makes improving access to the park and revitalizing St. Louis’s downtown more than just a dream. The competition to properly frame this national masterpiece is underway, and one of the five final proposals got our attention.  City To River aims to turn the Arch grounds into a version of Millennium Park and the highway into a boulevard resembling Michigan Avenue. According to Kevin Muesenfechter of City To River, “The boulevard would allow for easier pedestrian access between the riverfront and downtown, and it would allow for the redevelopment of land along the boulevard that could spark an estimated $1.1 billion in investment over the next 20 years.”

This proposal emphasizes walkability and smart growth to revive downtown St. Louis by turning a highway into a boulevard, an action CNT has strongly supported in the past. For more information on the proposals for the park still in the running, visit the “Framing a Modern Masterpiece” website.

At the recent 18th Congress for New Urbanism, U.S. Housing and Urban Development Secretary Shaun Donovan made a tremendous declaration: “For the first time in the history of federal grant competitions, I want to announce today that HUD will be using location efficiency to score our grant applications”.

The energy in the room was tangible. “We’re breaking down silos”, Donovan asserted, and indeed, this commitment from HUD to weight grant applications with spatial context in mind will advance the comprehensive approach to community development that CNU, CNT and other smart growth advocates have urged for years.

Over the past year, HUD has taken on an impressive task of touring cities, meeting and listening—“from mayors and other officials of both small and large communities, to business leaders in growing regions, to governors of states that have been hit hard economically”—to design and tailor a program that reflects what communities want, with the ability to apply context-sensitive solutions that work for each community. And CNT believes that the outcome and the subsequent announcement by Donovan show a real commitment to developing tools and resources that will help regions become strong economic engines—with healthy communities and reduced household expenses.

“Today, the average household spends more than half of its budget on housing and transportation. They have become American families’ two single biggest expenses”, said Donovan, affirming the findings of CNT’s H+T Index, which shows only two in five American communities—or 39 percent—are affordable for typical households when their transportation costs are considered along with housing costs.

CNT was an early developer of “location efficiency” and used the concept to design the Location Efficient Mortgage® (LEM), along with the Natural Resources Defense Council and the Surface Transportation Policy Project. When elements like compact neighborhoods with interconnected street networks, access to transit, mixed land uses, and concentration of retail and services are brought together, an efficiency of scale can be achieved that reduces the dependence on and the intensity of driving, freeing up more money for housing and other household expenses.

While the concept of energy efficiency has been more well-known and even celebrated, CNT has been a long proponent of the efficiency of locations. In 2008, CNT President Scott Bernstein testified in front of the House Financial Services Committee in support of the proposed “Green Resources for Energy Efficient Neighborhoods (G.R.E.E.N.) Act” by U.S. Rep. Ed Perlmutter (D-CO), arguing that it was a great start in providing incentives to homeowners in becoming more efficient, but that it should not overlook the importance of the ˜location” of a home when determining its efficiency.

These significant investments that HUD will make into planning sustainably complement recent investments by DOT through the TIGER program and the broad goals of the Partnership for Livable Communities to make policy and funding decisions in concert. As Secretary Donovan pointed out, “…it’s time that federal dollars stopped encouraging sprawl and started lowering the barriers to the kind of sustainable development our country needs and our communities want.”

“Secretary Donovan has made exactly the right move at the right time. This is the strongest evidence yet that the Obama administration is doing what it says it would do”, notes Scott Bernstein.

Shaun Donovan’s remarks at the CNU Conference came just two weeks after HUD released its 5-year strategic plan, deeming it a “new direction for HUD”. The 5 points that the plan outlines were implicit in the direction and goals that he stated at CNU. And the agency is already taking on a united front with this message. At the recent National Alliance of Community Economic Development Associations, Deputy Director Ron Sims, in his keynote on institutionalizing policy focused on sustainability, affirmed, “Sustainability is not the exclusive domain of the rich; it has to be for everyone.”

A message that CNT supports entirely. We are looking forward to similar commitments from other federal agencies—namely USDOT and USEPA—as well as state and local governments across the country.

Read Secretary Donovan’s remarks at the 18th CNU.

Read more on location efficiency on our website, including related testimonies and reports.

(Photo by James Hamilton, Shaun Donovan in 2007)

Senator Kwame Raoul led the effort to pass the Housing + Transportation Affordability Index Act (SB 347) in the Illinois Senate last month, and on Tuesday the bill passed in the House with overwhelming bipartisan support, led by Representative Barbara Flynn Currie, Chief Sponsor, and seven co-sponsors from both sides of the aisle.

CNT has been working with Illinois legislators since early 2009 to advance this valuable piece of legislation that applies CNT’s framework of combining housing and transportation costs to planning and making public investment decisions.

Used as a planning tool, the H + T Affordability Index^SM can effectively measure the impacts on household budgets that result from public investments, so that decision makers can choose investments that make sense for our taxpayer dollars as well as for our individual wallets.

Five state agencies participated in the development of this legislation that will provide better access to the costs of both housing and transportation. Having a tool to use as a benchmark will give these agencies the ability to screen how investment decisions will impact the cost of living for residents in metro areas.

The Department of Commerce and Economic Opportunity (DCEO), the Department of Transportation (IDOT) and the Illinois Housing Development Authority (IHDA) can use CNT’s H+T Affordability Index, or a similar measure that includes both housing and transportation costs, to screen and prioritize public investments in MPO areas. In addition, the Capital Development Board (CDB) and the Illinois Finance Authority (IFA) will recommend the use of the Index for new siting decisions.

By encouraging public investments that take advantage of existing areas of greater density, which all communities have, the State is taking initial steps that contribute to lowering the cost of living for families.

Illinois has the opportunity to set a valuable example to other states for how the use of combined housing and transportation data can move regions towards decisions that create more sustainable and equitable growth. While the Partnership for Livable Communities is driving Federal priorities to coordinate housing, transportation and environmental investments, Illinois is leading the states by example to create better and more affordable places to live and work.

CNT joins state leaders to now urge Governor Quinn to sign the Housing + Transportation Affordability Act into law with no delay.

The report, produced in partnership with the Center for Housing Policy (CHP) and CNT, provides a comprehensive analysis of the “cost of place” in 18 regions from southern New Hampshire to Worcester to Rhode Island by quantifying the burdens facing families in those regions to meet the number one and number two expenses – housing and transportation – and highlighting areas with extreme burdens where households spend more than 58% their income on these costs.

The combined costs of housing and transportation vary among the 18 regions examined, ranging from 48 percent of household income in MetroWest to 62 percent in the South Coast. The report finds that one in four households in the study area are located in neighborhoods in which there are extreme cost burdens. In Boston, the cost is 56 percent, due in part to the City’s extensive public transportation system. In fact, Boston had the lowest transportation cost of all the regions studied in the report.

“Within the Boston region, there are pockets where housing is affordable but transportation offsets those lower costs. Many people in the workforce—teachers, nurses, office workers—are forced to spend precious time and money commuting from the homes they can afford to the places where they work,” said ULI Terwilliger Center Chairman J. Ronald Terwilliger. “These findings reinforce that years of ever-sprawling development have resulted in a growing gap between where people live and where they work.” Terwilliger, Chairman Emeritus of Trammell Crow Residential, founded the Center in 2007 to help achieve a measurable increase in the supply of workforce housing in high-cost markets throughout the nation.

CNT’s Scott Bernstein joined J. Ronald Terwilliger, Boston Mayor Thomas M. Menino and New England Regional HUD Director Richard Walega at the April 12 press conference in the Great Hall at Faneuil Hall to announce the report and its companion Web site, www.BostonRegionalChallenge.org. In addition, they unveiled a new online Cost Calculator that families can use to accurately determine their combined housing and transportation costs based on where they live, where they work and how they commute.

“No longer will the true cost of a house be hidden in the Boston Area,” says Scott Bernstein, CNT President. “This calculator gives consumers an insurance policy against the rising and chaotic costs for transportation and fuel. It will help home seekers, both owners and renters, know what it’s worth to take advantage of the region’s mass transportation and local amenities, and in the process, avoid locations that are too financially risky.”

And the implications are not unique to just the Boston region. The findings show that whenever housing is not efficiently located to jobs, stores, schools and other amenities, household transportation expenses soar above the recommended 18% of one’s income. CNT’s Housing + Transportation Affordability Index currently displays this trend for over 80% of the population – 337 metropolitan areas in the U.S.

The release of the report was in conjunction with the ULI Real Estate Summit at the Spring Council Forum this week in Boston. The need to build workforce housing closer to employment centers is among many issues being discussed as part of ULI’s overall efforts to promote sustainable communities.

Of the many reviews of CNT’s recent release of the H + T expansion for 337 metros in the U.S., we thought Transportation for America’s conclusion that our research “turns the conventional wisdom about affordable housing on its head”, hit it on the head.

Indeed, our goal is to challenge and redefine the traditional measure of affordability used by planners, lenders, and most consumers.

CNT’s intensive analysis shows that only 2 out of 5 communities in the U.S. are affordable when transportation costs are added to the traditional measure of affordability.

The Index is providing a tangible quantifier that perhaps helps to explain a growing sentiment in America.  “People are tired of long commutes, they’re tired of congestion, and having transportation options is becoming an increasingly viable political option in some of these areas.”  That’s according to Andrea Bernstein, of NPR’s The Takeaway.

Triple Pundit recognizes even more linkages: “These costs are not just financial. More miles driven means more CO2 in the atmosphere, and more pollution in general. They also mean less time spent with loved ones, or doing something else, whether work or play.”

Adding it all Up

CNT’s comprehensive data is providing decision-makers with valuable information that helps explain a renewed desire in America to live where we work and work where we shop, as observed recently in The New York Times.  Most importantly, it is laying a foundation for undoing one-dimensional policies that have encouraged “drive til you qualify” growth patterns in the name of “affordability”.

Real estate professionals right away recognized the void.  According to the Pittsburgh Post Gazette, “In interviews Tuesday, local real estate professionals said that while most prospective buyers place a premium on location and convenience, they rarely do the math on transportation expenses.  Linda Carnevali, regional manager for Prudential Preferred Realty, said in 23 years she had never seen a prospective buyer compute transportation costs.”

The Washington Post recognized CNT’s implicit policy goals. “The report was issued two months after Transportation Secretary Ray LaHood announced a shift in federal transportation policy to put greater emphasis on non-automotive options, including mass transit and better bike paths and walkways.”

What do we do with this “data-fest”?

We have released the H + T Index and accompanying Penny Wise Pound Fuelish at a critical juncture.  Just as the federal Partnership for Sustainable Communities broadens the federal definition of affordability to include transportation, the Illinois General Assembly votes on a Housing + Transportation Affordability statute requiring state agencies to take housing and transportation costs into consideration when making public investments in urban areas, and CNT and the Chicago Metropolitan Agency for Planning (CMAP) finish Driving: A Hard Bargain, an analysis of H + T costs in the Chicago region (available soon).

The H+T Index fills a critical gap in information and has broad implications for public policy and program investments.

At its most basic level, the Index highlights the need for:

• A new standard of housing affordability;
• Better coordination between housing, transportation and land use agencies and decisions;
• Public transportation investments to be screened for their impact on the overall affordability of housing projects;
• Investments in housing developments screened for their impact on household transportation costs;
• Mass transit investments instead of highway expansions; and
• A broader transit oriented development strategy predicated upon a range of housing types and price points.

Read more about our specific recommendations at the end of Penny Wise Pound Fuelish.

Read more about the H + T release in the H + T Press Room.

The Index for the first time examines 337 metro areas across the country—161,000 neighborhoods and 80 percent of the U.S. population—to provide the only comprehensive snapshot of neighborhood affordability by taking into account the transportation costs associated with neighborhood location and design. Read more of the findings in this brief

On March 23, 2010, CNT President Scott Bernstein was joined by Deputy Secretary Ron Sims of the U.S. Department of Housing & Urban Development , Under Secretary of Policy, Roy Kienitz of U.S. Department of Transportation and Chicago Metropolitan Agency for Planning Executive Director, Randy Blankenhorn, and Managing Director Nick Turner of the Rockefeller Foundation to discuss the findings of the new H + T Affordability Index and its accompanying report, Penny Wise, Pound Fuelish. Listen to the audio of the teleconference.

As HUD Deputy Secretary, Ron Sims, put it, “The Index and report are long overdue. Finally, Americans have the tools to make better decisions about where they live.”

New Website features include

• Expanded to 337 metro regions
• Block Groups identified
• Block Group regional benchmark
• Find low and high values

The H+T Index shows that once transportation costs are factored into the definition of “affordable housing,” the number of affordable communities drops in almost every metro area in the country, resulting in a net loss of 48,000 neighborhoods with combined housing and transportation costs that stress the average family’s budget. Read more background at http://htaindex.cnt.org/about.php

Explore the new H + T Affordability Index for 337 U.S. metros >>
Learn more about and download Penny Wise, Pound Fuelish >>
Read the full press release >>
Visit the Press Room to learn more >>

If passed, SB 374 (formerly known as SB 414) will ensure that five state agencies in Illinois take both housing and transportation costs as a benchmark for affordability into account when planning and making public investment decisions within Metropolitan Planning Organization (MPO) Areas around the state.

The agencies that would use the standard are the Capital Development Board (CDB), the Department of Commerce and Economic Opportunity (DCEO), the Department of Transportation (IDOT), the Illinois Finance Authority (IFA) and the Illinois Housing Development Authority (IHDA) as well as the Illinois Housing Task Force and the Interagency Coordinating Committee on Transportation. These agencies can use the H+T Affordability Index as a planning tool and as a criterion in the allocation of public funding for transit, highways, economic development, and housing projects; the distribution of economic incentives to businesses and the siting of public facilities.

The passage of the bill comes just one week before CNT’s planned release of our H+T Index for 337 metropolitan regions in the U.S. (covering nearly 80% of the population) and as federal agencies move towards a definition of affordability that includes both transportation and housing costs. By implementing the Housing + Transportation Affordability Act, Illinois can provide a valuable example of how H+T data can move regions across the country towards more sustainable and equitable growth.