It is the 5,000-pound question mark hanging over the head of city leaders: How fast is Lawrence growing?

For years, that was an easy question to answer. During the last two decades, the U.S. Census Bureau portrayed Lawrence’s population growth as reliable as an old Timex – it ticked along at a steady increase of 2 percent per year in the 1980s and 2.2 percent in the 1990s.

But then the new millennium dawned, and the Census Bureau began telling a different story about the city’s population growth. The Timex, it seems, is taking a licking.

The official population counters now say Lawrence is growing at a more subdued 0.3 percent annual rate. And from July 2004 to July 2005, the Census Bureau said Lawrence’s population actually declined – albeit by just 26 people, or less than one-tenth of a percent.

But if true, that’s still the type of number that makes community planners take notice. After all, population growth is a major factor in determining the need for new homes, streets, schools, stores and other big-picture issues. A growth rate that is less than half what it used to be would require city leaders to look differently at what the city’s needs are for the future.

And for residents, the stakes are high too. Population growth has generally been considered one of the foundations of Lawrence’s hot real estate market. Strong demand for new homes has created wealth for homeowners throughout the city by essentially guaranteeing the value of their homes will grow by 5 percent or more per year. Those increasing values also have provided a steady flow of tax revenues into Douglas County governments.

But if what the Census Bureau now is saying about Lawrence’s growth is true, all that may change. The key question, though, is whether the new numbers are correct. Several city leaders are doubters.

Anthony Klebenstein, of LMK Construction Inc., works on constructing a back deck to a Eudora home. Eudora's more affordable housing may be having an effect on Lawrence's population growth.

“I’m confident they’re off base,” said David Guntert, a planner who tracks population numbers for the Lawrence-Douglas County Planning Department.

Others, though, are beginning to show signs of worry.

“I would not be surprised if the census is correct,” said Tom Bracciano, who as director of facilities for the Lawrence school district follows population trends. “I think we’ve seen a real demographic shift occur in our community. It is very difficult for a young family to afford to buy a house and live in Lawrence.”

Faulty math?

Here’s what the Census Bureau is saying about Douglas County growth in a nutshell: Since July 2000, the city has added just 1,535 residents.

Guntert’s response: “I’m just not buying it.”

He’s estimating that the city has added closer to 9,000 residents during the five-year time period. Simple arithmetic will show that his numbers are a lot closer than the Census Bureau’s, he said.

During the five-year period in question, the city added 3,812 living units – everything from single-family homes to duplexes to apartments. Multiply those living units by 2.3 people – which is the average number of people per living unit in Lawrence, according to the 2000 census – and you come up with 8,767 people. And that doesn’t consider any of the several hundred homes being built outside the city limits.

Even if the average number of people living in a house has dropped some – which is possible if Lawrence is becoming more of a retirement community as some have expected – the number of new living units still suggests more than 3,000 people have been added to the area’s population totals.

But math also could explain how the Census Bureau could be correct. What the city hasn’t factored into its mathematical equation is the vacancy rate of homes in the city. More than half of all the city’s housing is rental housing, so vacancy rates are an important part of the equation.

And some landlords are saying the city is experiencing historically high vacancy rates. Bob Ebey, a leader of Landlords of Lawrence, estimates the vacancy rate of all rentals is 15 percent to 20 percent.

According to numbers compiled both by the Census Bureau and the city, Lawrence has about 20,000 rentals. At a 15 percent vacancy rate, that would equate to 3,000 homes that have no one living in them.

That would mean that Lawrence didn’t really add 3,812 living units during the five-year period, as city officials contend. In essence, the city only added 800 living units that actually are occupied. Multiply that number by 2.3 people per living unit and that equates to an additional 1,840 people, not 9,000 as the city figured.

‘Bit of denial’

Ebey admits he does not have an actual study to back up his claims of such vacancy rates. Instead it is just an estimate based on numerous conversations with a large number of landlords. Douglas County Appraiser Marion Johnson said no comprehensive vacancy study on the rental market – one that looks at both apartments and houses – had ever been done in Lawrence.

Kirk McClure, a professor in urban planning at Kansas University who follows the city’s housing market, said he thought 20 percent would be an overestimate of the vacancy rate.

But he said vacancy rates could be in the 10 percent to 15 percent range, he said, and it is likely the average number of people per unit had declined some. Both of those factors would produce fewer people than the city has estimated.

Enrollment in the Lawrence school district in recent years is the best evidence to support the Census Bureau’s claim, McClure said. Since 1999, the district’s enrollment has dropped by about 5 percent, which McClure said seemed unlikely if Lawrence actually added 9,000 new residents.

“I worry about the school numbers,” McClure said. “I know there are more people home-schooling and I know there are more private schools, but the numbers don’t add up to me. To me, the school numbers are the best corroborating evidence that the Census Bureau is right.”

Other urban planners who are more detached from the Lawrence scene tend to agree. Francis Parker, a professor at Ball State University’s urban planning department, said he would caution any city against believing the Census Bureau has missed the mark by so much. After all, the Census Bureau hasn’t changed its methods from previous decades when the Lawrence estimates were generally accepted.

And he said anecdotal evidence, such as the steady increase in Lawrence traffic, that some city leaders have cited as a cause to disbelieve the census was dangerous.

“Every place has traffic growth that is two or three times the rate of population growth,” Parker said. “It is just not a good indicator. It does sound like some people in your community might be in a little bit of denial.”

Truth or consequences

Parker said community leaders need to get their arms around what the city’s true growth really is if they hope to chart an accurate course for the community’s future.

“What I would tell people is if this is true, don’t get panicked that your growth is slowing down to this point,” Parker said. “It’s not the end of the world. It is just different.”

But Parker conceded slower growth likely would be painful for the city’s building industry. And that could produce ripple effects in the Lawrence economy.

The building industry generally is seen as the second-largest industry in the community, right behind KU. About 7,000 people are directly employed by construction and trade firms. But several thousand others – such as bankers, real estate agents and material wholesalers – are somewhat dependent on the industry.

Whether a slowdown in population growth would automatically equate to a slowdown in property valuations is an open question. Parker said a 0.3 percent growth rate could still allow a community to remain attractive. He said property valuations could continue at or near their current rates if the supply of housing was appropriately adjusted to the new demand for housing.

But private consultants who help communities plan said what usually happened was existing residents were called upon to shoulder more of the city’s ever-increasing costs.

“It ultimately will affect your taxes and your city’s ability to provide services and undertake new projects,” said Brian Sands, a senior associate at Economics Research Associates, a Washington, D.C.-based consulting firm.

And there’s at least one other reason for city leaders to ponder a 0.3 percent growth rate: It decreases the city’s margin of error. Nearly everyone in planning circles agrees that a long-term growth rate near zero – or a negative growth rate – would spell problems.

Interim City Manager David Corliss is among city leaders who aren’t ready to concede the validity of the Census Bureau’s numbers. But he said if the numbers are true, they are troubling.

“It would concern me,” Corliss said. “A community that doesn’t grow will have a new set of challenges that, I think, in all instances are worse than the challenges a growing community faces.”