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company towns in good company

By Walker Boyd

Rio Rancho real estate map

Rio Rancho, New Mexico’s third-largest city has been an easy target for environmentalists and critics of development-oriented growth. It relies completely upon the aquifer for its water supply; its municipal government is small (it didn’t incorporate until 1981) and arguably beholden to the interests of corporations like HP and Intel who have moved to Rio Rancho to take advantage of property tax abatement and other government-provided incentives.

But if ahistorical (and unchecked) growth is Rio Rancho’s signature, then  it is really a reflection of the same growth that Albuquerque has undergone. The City of Albuquerque’s population in 1980 was only 3/5 of what it is today.

Rio Rancho and Albuquerque’s stupendous growth underlies many problems they face going into the 21st century.

The other day I was poking around Zimmerman library’s scant collection of books and theses about Rio Rancho. A 1998 thesis by Patricia Pollock argued that “AMREP [American Real Estate and Petroleum, Rio Rancho’s developer]’s sole motive in purchasing land in New Mexico was to tap into the profit potential of land speculation.

Likewise, the growing residential market enhanced the investment potential for individual owners.” Another 1994 article talks about how Rio Rancho is a new template  for 21st-century company towns; in this light Rio Rancho is McDonald, Ohio, and Intel is this century’s Carnegie Steel.

But these arguments cast Rio Rancho as anomalous; despite isolated fears about groundwater and air pollution in Corrales, Intel’s presence has been generally well-received. Despite some frustrations about lost tax revenue, it’s hard to imagine anyone in Albuquerque or Rio Rancho city halls complaining about Intel and the overall boast it has supplied to the regional economy.

And when compared to SunCal, Eclipse Aviation, and any number of other failed developments, Intel comes across as both a model and an exemplar of successful development.

As Clearly New Mexico pointed out, the most recent SunCal bid for TIDD tax-breaks didn’t fail because of organized opposition to the development of the West Mesa, but because their proposal was transparently untenable; politicians know that tax breaks are only worth it so long as gross receipts tax from the actual construction of houses makes up for their losses.

We weren’t so lucky with Eclipse Aviation, but like other failed developments, Eclipse failed not because it was a bad idea but because it was in the wrong place at the wrong time: demand for private jets fell because of the recession, and beleaguered Albuquerque tax payers were no longer willing to subsidize their construction for non-existent customers.

Questions about water and the environment take the back seat to development and growth in cities like Albuquerque. But what if development is permanently stalled, and subsistence, let alone sustainability, becomes a priority?

Here, critics of growth for growth’s sake have more ground to stand on. A critical view of Intel and Rio Rancho yields a different insight on growth. The United States has enshrined freedom of trade in its Constitution, and as long as the status quo prevents New Mexico from assuming a more regional, self-sustaining outlook, national and international trends will determine the arc of development.

But critical uneasiness is well-founded. So long as our economy grew at a rapid pace, projects like the Hoover and Imperial Dams made sense to satisfy a growing population. But as population growth stagnates and housing prices fall, the wisdom of planning for more growth appears more circumspect.

India and China, two economies that are still rapidly growing, can afford audacious projects to mitigate the effects of drought. But the wisdom of such autocratic, growth-at-all-costs government, authoritarian by nature and with annual growth rates as the only clause in the social contract doesn’t fit New Mexico very well.



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