Value Capture as a Policy Tool in Transportation Economics: An Exploration in Public Finance in the Tradition of Henry George

American Journal of Economics and Sociology, The,  Jan, 2001  by H. William Batt

• E-mail
• Print
• Link

The one available place to link the New York State Thruway to an interstate north to Montreal was at the western edge of settled Albany where the area was largely farmland. The bulk of the land that would be taken was in the rural towns of Guilderland and Colonie, still part of Albany County which the mayor controlled. A sliver of Albany extended out further to the west, the locus of the earliest waterworks servicing the city, originally developed by the first Erastus Corning who was President of the New York Central Railroad and, not coincidentally, also mayor a century earlier. Since the water supply had now been replaced by a larger reservoir further away, this vacant land stood open to development. Washington Avenue, the middle of three corridors extending west of the city, would subsequently extend through the heart of this area, threatening an ecologically sensitive area of pine bush, dunes and even an endangered species of butterfly. No matter that other areas were available to settlement; Washington Avenue Extension is easily accessible to Northway and currently invites--almost demands--development on account of that very infrastructure investment, even though the Corning era passed nearly two decades ago.

In the 1950s the land on the western edge of the city of Albany was largely truck farms. In fact it was some of the best farmland in Albany County and even in the State of New York, because it was at the confluence of the Mohawk and Hudson Rivers, largely flat alluvial terrain.

But the construction of the New York State Thruway, finished in the early 1950s, had already influenced the pace of suburban development in the area, and post-war prosperity and the boom in families further spurred the growth of housing on what was, by city standards, cheap land. The Northway's construction would further influence the pace of development. Saratoga County to the north had receded in importance with the decline of rail service, despite its attractions of thoroughbred racing and gambling. But in the 1970s and 1980s it became the fastest growing county of the State, a suburban community servicing Albany, the seat of government, Schenectady, the home of General Electric, and Troy, the home of Rensselaer Polytechnic Institute. Saratoga County epitomized the development of residential sprawl, while the downtowns of Albany, Schenectady, and Troy across the Hudson River floundered. By the mid-1990s these three cities were suffering major financial problems due to their declining commerce and industry, while the suburbs flourished. Figure 4 shows the area of the Northway discussed in this paper, from its origin at the juncture of Route 20, the old westward post road, to the point where it crosses the Mohawk River/Erie Canal nine miles to the north.

The Northway was thus linked not just to the New York State Thruway but to the two major state highway corridors extending west as well. These were the earlier-mentioned Route 20 and the even more established Route 5 which led to the City of Schenectady. Centers of capital development and major areas of economic activity shifted to the lands close by these corridors, especially to areas accessible to the Northway. Enormous retail shopping centers and office parks soon lined up on either side. Parallel to the Northway was Wolf Road, formerly a farm road, and now Albany County's "million dollar mile." Exacerbating the suburban exodus further was the fact that it was located just outside Albany city limits in the unincorporated Town of Colonie, allowing businesses to take full advantage of lower taxes than the city exacted.