I’ve been riffing about transit-oriented development (TOD). One place it could work is Dublin Port; another is west Dublin along the Dublin-Cork line. It’s the only way I can see to deliver 50,000 homes per year, year-in year-out for the next few decades.

Building a new city quarter to accommodate hundreds of thousands would have its challenges. Masterplans would need to be drawn. Planning permissions would need to be sorted. Landowners would need to be co-opted. Tunnels would need to be dug.

Taken individually, each one of these problems is solvable. If Ireland hasn’t solved them yet, there are templates out there. Germany knows how to build an S-bahn tunnel. Denmark knows how to masterplan and sort the planning permissions. Brazil or Hong Kong know how to bribe landowners.

It might be that the hard part won’t be copying Germany’s tunnel plan or Sao Paolo’s development auction plan. The hard part might be getting the many powerbrokers in the Irish government pulling in the same direction.

Take the hypothetical plan to upgrade the west Dublin train lines and build lots of housing there. Let’s say there was buy-in for such a plan from the cabinet.

Such a big and complicated plan would touch on multiple arms of the State. It would need support from: the cabinet; the minister for housing; the officials at the Department of Housing; the minster for transport; the officials at the Department of Transport; the minister for public expenditure; the officials at the Department of Public Expenditure; the National Transport Authority; Transport Infrastructure Ireland; CIÉ; Uisce Eireann; Eirgrid; Waterways Ireland; open eir; Gas Networks Ireland; An Bord Pleanála; South Dublin County Council and Kildare County Council. All of this in addition to partnerships with private developers and contractors to get the thing built.

In principle, if the Taoiseach wants something, the many arms of the State should snap their heels and get to it. But that’s not how bureaucracies work in practice. Government workers and departments are no different from anyone else. They act in their own best interest. Sometimes it’s in a department’s interest to do what the Taoiseach wants. Other times it’s not.

Handbrake on

Consider the local authorities. Local authorities would have a lot of say over a big new transit-oriented development on their patch. They’d be involved in the planning and setting out the infrastructure. They could use their power to delay or stop a project.

Would a local authority actually want something like this to happen? It’s debatable. Irish local authorities have a funny setup. They control what can be built on their patch through the local planning department. So they can stop development, or limit it.

It’s normal for local government to control development in their patch. What’s unusual about Ireland is that local authorities don’t benefit financially from new housing on their patch.

Let’s look at Limerick City’s accounts. Limerick City raises about 10 per cent of its budget in taxes. Two-thirds of its budget comes from central government subventions, the rest of it from rents on council housing. Of the 10 per cent it raises in tax, seven per cent comes from taxes on businesses. Two per cent comes from taxes on property and one per cent from development levies. Only two or three per cent of Limerick City’s budget is directly tied to the amount of private housing in the city.

Contrast this to the US, where local governments are usually hungry for growth. They’re incentivised to be hungry. American cities raise much more in local property taxes than Irish local authorities. When houses get built, the city gets more money to spend on schools and policing and what have you.

In Ireland, the local authorities aren’t entrusted with anything as important as schools or policing. Neither are they allowed to raise much money in taxes.

The upshot is that Irish local authorities are more cool on new housing than American cities. They don’t roll out the red carpet. New residents can be a pain in the neck, after all. They use local services, they need new infrastructure, and they discommode locals.

Someone on Twitter — I can’t remember who — once said something to the effect that “the UK has precisely the wrong amount of local government”, and I think the line applies to Ireland too. What it means is that we have exceptionally weak local governments. They don’t take in much tax. They are entrusted to run few government functions. They have little incentive to grow. And the one power we do grant them is the power to block new building.

Scholars have found a strong relationship between local government funding and the amount of building that goes on. In Institutional settings and urban sprawl: Evidence from Europe, Ehrlica, Hilberb and Schöni found that decentralised local governments were associated with 25-30 per cent more sprawl (aka city growth). Another study found that when the UK national government grabbed local property taxes from the local authorities, local authorities responded by building less commercial space.

All of which is to say, if we want a big new city quarter, it’s not enough for the cabinet to decree it. People with the power to stop the plan need to be brought on board. Incentives need to change.

Ireland has two ambitious TOD projects on the go. But they are languishing. In Limerick City, there is a scheme to build 10,000 homes around Colbert train station. And Dublin there are plans for 40,000 homes at City Edge, along the Naas road.

Both schemes were launched to great fanfare. But someone, at some level of government, has slowed them or killed them. The Limerick project has the enthusiastic backing of the Land Development Agency and CIÉ, but it appears to be dead in the water. And I haven’t heard much about City Edge this year.

The company model

One way of getting everyone onside is to spin up a new institution with the power and the incentives to get the job done.

“In Australia, they have quasi-public development companies, known in Western Australia as Land Corp,” said Prof John Renne, a TOD expert at Florida Atlantic University. “There are these massive redevelopment agencies, they come in, they buy the land, they reposition it, they build the public amenities like the streets and the plazas, and then they sell off development parcels to private developers that come in and build the buildings.”

Cathal Fitzgerald, an economist at the National Economic and Social Council, said: “It’s hard to imagine [Ireland building] the Semitan institution they have in Nantes. It’s owned by the local authority, the transport company, the bank, and the Chamber of Commerce and local interests. It’s hard to imagine an Irish institution that’s involved in planning, that’s a private company, and that is bidding for some of the contracts that are rolled out by that same institution. That would be a major ideological leap.”

In Ireland we’re stuck in a local maximum, doing the best we can given our limited and divided state. To do much bigger things, we’ve got to pay attention to the wiring of the state. We’ve got to get everyone pulling in the same direction.