County growth slowed by rising housing costs

Local wages not keeping pace, researcher says

Tiffany and David Ruse almost left Lawrence.

They didn’t want to. But when the young couple started their housing search last year, they couldn’t find an affordable home that didn’t require extensive renovations.

“Our budget wasn’t that great, limited to $150,000,” said Tiffany Ruse, 23. “The houses we looked at were practically falling apart.”

So they started looking in Topeka and elsewhere.

“We were even looking at Oskaloosa,” Ruse said, “and I definitely don’t want to live there.”

A few weeks ago, they struck gold: a good house, within their budget, near Lawrence Memorial Hospital. The Ruses will stay in town.

Fewer people may be making the same decision, however.

The U.S. Census Bureau will release estimates today showing that Douglas County is growing more slowly than at any other time since World War II — 2.8 percent over the last four years in a community used to 2 percent annual growth.

One Kansas University researcher says the slowdown is the result of local housing prices outpacing wages.

At the site of a new subdivision in Ottawa, Deanna Davis, 10, climbs a hill of excavated dirt as neighborhood friends play in the dirt. Although Douglas County's population boom now appears over, the surrounding counties, including Franklin County, are experiencing the same increase as Douglas County did in the 1980s. Deanna and her friends are pictured on Wednesday.

“I think it will continue to slow down until we see income rise again, or until housing slows down,” said XanWedel, at KU’s Policy Research Institute. “Something’s going to have to give.”

City officials dispute the census numbers, however. Another official noted that Lawrence’s growth still beats the state average of 1.7 percent growth.

“I think that speaks to the strength of our economy,” said Lynn Parman, economic development director for the Lawrence Chamber of Commerce.

The reason a population slowdown matters: A community’s growth rate can affect everything from the availability of new jobs to your tax bill.

“It is important,” Parman said.

The numbers

Today’s census numbers show Douglas County added 2,800 residents between 2000 and 2004.

If the trend continues through the end of the decade, the county will end up with just over 7,000 new residents in 2010, a 7 percent increase. The last time the county added fewer than about 10,000 residents per decade was during the 1950s; the last time the growth rate was under 10 percent was during the 1930s.

Wedel said that during the 1980s, the average Douglas County household income grew by 86.5 percent, while the value of owner-occupied homes increased at a slower rate, 45 percent. During the 1990s, the trend reversed. Home values rose by 73 percent while incomes grew more slowly, at 42 percent.

That trend may be catching up with Douglas County, she said.

“I think that’s why we’re seeing the decline now,” Wedel said.

Leavenworth and Johnson counties grew more quickly than Douglas.

And Franklin County, south of Lawrence, had one of the fastest growth rates in the state — 1,200 new residents for a 5.1 percent increase. Ottawa City Manager Weldon Padgett said he believed some of that growth was coming from Lawrence.

“The price of a home here and in Lawrence is very different,” he said.

Parman, however, noted that the census report covers the time period that included the 9-11 terrorist attacks. That resulted in a recession, she said, which slowed growth everywhere.

“Everybody’s percentage increase has been lower than it has been in the past,” Parman said.

No surrender

At Lawrence City Hall, officials weren’t ready to concede the census was correct.

City Manager Mike Wildgen said the city’s own estimates show Lawrence has grown by more than 8,000 residents during the decade, and that doesn’t include the rest of the county.

City Commissioner David Schauner agreed with Wildgen.

“It’s kind of hard to see that as you drive around town, as you see all the new housing starts in West Lawrence and all the new apartment houses we’ve built in the last five years,” Schauner said. “It’s hard to reconcile my visual impression with those numbers.”

Lawrence School Supt. Randy Weseman noted the district had closed down city-centered schools in recent years while building new schools on the outskirts of town.

“Maybe we misinterpret the growth on our perimeters and don’t pay attention to the interior of the city,” he said.

Decade Population % Increase
1900 25,096
1910 24,724 -1.5
1920 23,998 -2.9
1930 25,143 4.8
1940 25,171 0.1
1950 34,086 35.4
1960 43,720 28.3
1970 57,932 32.5
1980 67,640 16.8
1990 81,798 20.9
2000 99,962 22.2
2004 102,786 2.8
Estimate

Schauner has been the lone commissioner to openly question whether Lawrence has an affordable housing problem. He wasn’t sure what to make of Wedel’s analysis.

“Wages play a critical role in the ability of people to live in Lawrence,” he said. “The affordability of housing is important, but I don’t know whether it’s the chicken or the egg.”

Some of City Hall’s biggest-ticket decisions are reliant on estimates of faster growth. A proposed $64 million sewer plant for the Wakarusa River, for example, is based on expectation Lawrence will add 20,000 residents this decade.

Boomtown?

If the community’s growth is slowing, Schauner said, that might not be an entirely bad thing. Taxpayers will face fewer demands to pay for expanded streets, sewers, police and other services.

“Boomtown numbers are difficult to handle in a planned and thoughtful way,” he said. “Some moderate growth seems more sustainable than a boom rate.”

Parman countered that additional taxpayers should help share the burden of government services. And she said that businesses considering Douglas County as a new location — bringing new jobs to the community — take a close look at Lawrence’s growth rate.

“In terms of economic development and attracting new companies, it is a variable that businesses look at,” she said. “If you have positive population growth, it’s usually an indicator you have a strong economy.”

In the meantime, Weseman said, population projections for the Lawrence school district are looking up after a couple of stagnant years — as many as 200 additional students may show up for class in the fall. That, in turn, would lead to increased financial aid from the state, more money for Lawrence classrooms.

But he’s not celebrating yet.

“Nobody seems to have cornered the market on figuring out,” Weseman said of population projections. “We don’t know until the school opens up in August.”