Tipping Point

Some Sacramento suburbs are in trouble. Others are thriving. See where your community stands

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Fifty years ago, if you moved to Arden or Carmichael, you probably had it made.

A house in those new suburbs – with a backyard for barbecues and attached garage for that new car – was the American dream in the booming post-World War II era.

That dream has faded. A Sacramento Bee analysis of 25 Sacramento-area communities finds many of the region’s original suburbs, born in optimism, now struggle with an aging and sometimes shabby housing stock, faded commercial strips and graying populations in need of assistance.

It’s happened as elected leaders, developers and successive generations of buyers focused money and energy on waves of new subdivisions offering bigger homes, newer technology and lower maintenance, as well as modern shopping malls that give governments a jolt of fresh tax revenue. Many of the communities receiving the most attention are far from the region’s urban core, leading to clogged freeways and sprawl.

It’s the greener pastures syndrome, and it’s prompted David Sander, Rancho Cordova vice mayor and board president of the Sacramento Area Council of Governments, and others to say Sacramento’s older suburbs need help.

“It is a massive issue,” he said. “Older neighborhoods suffer as new neighborhoods are built. Wealth moves on. Old corridors die.”

What are those greener pastures?

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The region’s once sleepy outer-edge towns, among them Folsom, Elk Grove, Lincoln and Roseville, have boomed, redefining modern Sacramento over the last 20 years. But some of those communities now face issues of their own that could challenge long-term stability. Some grew too fast. Some lack nearby jobs, forcing residents to make increasingly congested commutes. Some are just becoming expensive.

More recently, residents and newcomers are moving to Sacramento’s central core, revitalizing areas that previous generations abandoned. Oak Park, Tahoe Park and midtown Sacramento are epicenters of the new “infill” development trend.

That inward momentum also includes strong housing growth in the city’s North Natomas neighborhood, as well as in West Sacramento, across the Sacramento River from downtown, which is showing signs of becoming the region’s most dynamic city in the coming decade.

Here is a deeper look at communities in flux, some of them facing a tipping point.

Arden Arcade: For richer or poorer

This sprawling community of 100,000 people, across the American River from Sacramento, was among the first rural areas to be developed during Sacramento’s great post-World War II expansion, promising a new generation a fresh lifestyle with real elbow room.

Bucolic horse ranches, including one that produced Kentucky Derby winner Ben Ali, gave way to rows of ranch-style houses, garden apartments and swim clubs – one of which, Arden Hills, produced 1968 Olympic gold medalist Debbie Meyer.

Today, Arden Arcade still harbors clusters of multi-million-dollar homes in areas like Sierra Oaks and Arden Park. The most expensive home sale in Sacramento County history at $5 million just took place, purchased by the family of developer and Sacramento Kings minority owner Mark Friedman.

Blocks away, however, Arden Arcade suffers from poverty and blight. The community tied for the largest drop in household income since 1980 among the 25 communities analyzed by The Bee, and its incomes are among the lowest in the region. Arden Arcade also tied for the lowest percentage of residents who own their property. Recent data suggest more people per unit are now packing into the area’s many apartment complexes.

Several other suburbs, most notably Citrus Heights and Rancho Cordova, grabbed control of their destinies by voting to become cities. An Arden Arcade cityhood vote in 2010, however, lost decisively, in part because the area is so big that many who live there do not identify with other nearby neighborhoods.

Thomas Wroten, who has lived in Arden Arcade most of his life, is on the area’s planning advisory council. He’s frustrated by a lack of progress in filling vacant storefronts and said some residents oppose change, even if it brings in new investment. “There is enough hindrance to keep redevelopment from occurring in a natural way,” he said.

Yet Wroten says he is seeing young families buying homes. The area is affordable and close to downtown jobs, he said.

“Maybe the numbers don’t show it, but ... the (original) buyers are passing on, and you are getting families looking for something less expensive to fix up. I am seeing that more in the neighborhood now than a decline.”

Carmichael, Fair Oaks, Orangevale: Aging in place

Carmichael, the next suburb out from Arden Arcade, has avoided the economic decline of its neighbor. But its housing stock and commercial areas are aging. And, perhaps more consequentially, so are its residents.

One in five residents here is older than 65, according to census data. It isn’t the only graying community. With some residents on fixed incomes, the Carmichael median household income has slipped below the regional average. The area has 29 assisted living centers, according to caring.com.

Fair Oaks and Orangevale have remained largely fixed in time as well with aging populations. This trio of communities will likely be among the target areas later this year as Sacramento County government officials formulate a strategy for sustaining quality of life for the elderly.

Built mainly as bedroom communities, the trio’s retail economy is small. Store revenues in Carmichael, the largest of the three, are only one-sixth as much as its industrious neighbor, Arden Arcade.

Hoping to spark a resurgence, the county gave “downtown” Carmichael a face lift recently, adding sidewalks on Fair Oaks Boulevard so shoppers don’t have to walk on dirt next to ditches. And local developer Allan Davis and his late wife Nancy made news by opening the Milagro Centre, a labor of love to give Carmichael a restaurant-based community gathering spot.

River City Brewing Co. there has ended the neighborhood’s status as what Realtor and area resident Erin Stumpf called a craft brew desert. But Milagro has yet to find its footing as a revenue generator. Economic development officials say it may take a population turn-over to make businesses such as restaurants more viable.

“It’s almost a vicious cycle,” said Stumpf, a Carmichael booster. “Older residents don’t spend as much money, so there is not as much economic development.”

That change may be coming. Carmichael Chamber of Commerce president Jim Alves and his wife were the first younger couple on their Wilhaggin neighborhood street a few years ago, but now have been joined by others.

He senses a trend. “I think you will see an interesting dynamic.”

BEHIND OUR REPORTING

What is Sacramento's Tipping Point?

Tipping Point is a weekly series by The Sacramento Bee investigating the challenges our region is facing and what policy decisions are being made - and should be made - to shape our future. Find out more by clicking the arrow in the upper right.

How we reported this story

This story started with a concern sometimes expressed in metropolitan areas around the country: Are the early suburbs, which are now 50 years old, decaying?

Our research suggested the issue is nuanced. Communities are always changing. We found that some of Sacramento’s original suburbs, in fact, have lost ground economically. But our data also showed a handful of more recent boom areas that are now starting to show signs of strain. Though journalists are not good at predicting the future, we attempted, based on data and trends, to offer a glimpse of where key communities may be heading.

To do it, The Bee picked 25 local communities representative of the region for this story, including all of the largest cities in the area, and measured how they have changed since 2000.

The main comparisons used in the analysis were population growth, income growth, growth in the homeownership rate and growth in home values. The Bee also looked at age data, poverty rates, commute times, community retail strength, and conducted interviews with planners.

For population growth, The Bee compared data from the 2000 census to data from the census bureau’s 2013-17 American Community Survey.

The Bee used the same datasets to compare income growth. We adjusted income figures from the 2000 census for inflation using national figures from the U.S. Bureau of Labor Statistics. The 2000 census asked respondents about their income in the prior year, so income figures shown are actually for 1999. Homeownership rates were also drawn from those two census datasets.

Home values came from Zillow.com. They are adjusted for inflation using national figures from the U.S. Bureau of Labor Statistics.

Three important caveats

Community boundaries change. Shifts in homeownership, population or income may partially reflect the annexation or inclusion of new areas into an existing community.

Growth in income, population, homeownership and home values are often signs of a healthy community. But that’s not always the case. For example, a healthy community may choose to allow more affordable housing, bringing down median incomes, home values and home ownership rates. Or a healthy community like Davis may choose to stifle population growth.

Census data is often based on sampling and has a margin of error. Data for large communities like Sacramento are more reliable than data for small communities like Rancho Murieta. Likewise, small differences in homeownership, incomes or population over time or between cities may not be meaningful. Look for big differences, or clear trends, in the numbers.

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Folsom: Today’s ‘It’ city

If this were high school, Folsom would be the new cool kid. (Cool kids need a rival, though. In this case it’s Roseville.)

A historic town that remained on the sidelines during the post-World War II suburban rush, Folsom has come on strong since the 1980s, undergoing perhaps the biggest personality change of any community in the region. Nestled by an idyllic stretch of the American River near Folsom Lake and the Sierra Nevada foothills, the city has branded itself as a place for active outdoorsy types who like shopping and dining.

“It’s one of the most highly sought-after communities,” real estate analyst Ryan Lundquist said. “High property values coincide with high school ratings.”

It shows in the numbers. Since 1980, Folsom had the biggest growth in median income among the 25 communities. Folsom residents are among the highest earners, at $107,000 annually, far above the regional average of $64,000.

Schools have a good reputation. The Folsom High School football team is a national powerhouse. Home ownership rates are high. And hillside homes boast some of the best vistas in the region.

Still, rents are high by regional standards, and the median house value had grown to $555,000 in June, according to Zillow, pushing prices out of the range of many home shoppers.

The city has crept up to the El Dorado County line, but is far from done growing. It recently leapfrogged south of Highway 50, where developers plan to build more than 10,000 housing units on rolling hills with prices topping $1 million.

Those ambitious plans are making some residents uneasy. The city has limited water rights and will be stretching itself thin. Growth in the area also has made the Highway 50 commute into downtown Sacramento a slog, and the bet is it will get worse.

Rancho Cordova: A tale of two cities

Rancho Cordova is a city divided between past and future. New Rancho, south of Highway 50, is quietly becoming a magnet for young families by offering more affordable housing than Folsom up the road, some of it in urban-style, small-lot designs. The city boasts perhaps the best jobs-to-houses balance in the region with its growing office parks, industrial area and new technology companies.

It’s even got a modest hip factor going: A craft beer “Barrel District” of brewhouses has formed on the east side in the industrial area near Sunrise Boulevard.

But the story is different north of the freeway. Original Rancho, which grew up along the once bustling spine of Folsom Boulevard, is tired, dated and struggling economically.

Overall, Rancho Cordova home values – at $350,000 – are still below the regional average, as are home ownership rates and household incomes. But those numbers would have been worse, local officials say, had residents not rebelled against the county government in 2003 and formed a city.

Rancho Cordova incorporated as a city in 2003, joining Citrus Heights (1997) and Elk Grove (2000). The new city created a “blight busters” program and launched code enforcement sweeps of dilapidated apartment buildings.

The city is investing in Folsom Boulevard corridor physical upgrades. It has joined a Civic Lab experiment, sponsored by the Sacramento Area Council of Governments, to turn the Mather Field light rail station area, where there is a community college outlet, into a tight mix of housing, offices and retail.

City Councilman David Sander, who has studied the national decline of inner-ring suburbs, says he believes local government control, in this case, cityhood, helps aging areas fight for survival. “The county (government’s) range of responsibility is so broad — for that agency to maintain a sustained focus on a particular set of issues that will define successful long term success for specific neighborhoods is quite challenging.”

“A focused commitment to sweating the details, with an eye to the long-term health of the neighborhood is what is needed for success here. There is no simple formula or ready-made solution — it is an ongoing detailed entrepreneurial management, facilitation and brokering of opportunities and resources that lead to success in these communities.”

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Lincoln: The reckoning

By the numbers, Lincoln looks like one of the region’s success stories of the past two decades.

Bay Area retirees years ago discovered its oak-studded hillsides and neatly designed retirement communities. Median incomes soared in the last generation to $79,000, putting Lincoln in the upper half of Sacramento-area communities. The poverty rate is low, and home values are among the highest in the region.

Congestion in downtown has dropped since the state built the Highway 65 bypass, taking logging trucks off local roads and offering more room for the city’s distinctive street-legal golf carts.

But the city’s meteoric two-decade growth from a cozy 11,000 to nearly 48,000 has left it in a financially precarious place. A scathing state audit this spring accused city officials of mismanaging city funds, shuffling money from one fund to another to hide deficits.

“We grew too fast without having a financial framework to process that much business in that short of time,” new City Manager Jennifer Hanson said.

New Councilwoman Holly Andreatta says officials failed to negotiate an adequate city tax revenue share from new development. One result, she says, is the city has the lowest number of police officers per capita of any 5,000-person-plus city in the state, according to city-data.com. The city had 21 uniformed police officers in 2017, according to FBI data. Galt, roughly half Lincoln’s size, had 30.

Andreatta and Hansen say the city has made progress sorting out its finances since the audit. But distrust of City Hall is high and debates have flared over how much the city should continue to grow.

The city still plans to more than double its current population over time. Andreatta said she wants that to happen at a sustainable pace and for the city to remain the kind of rural town where residents still raise chickens and bunnies. “We do need to take a step back though and just slow down and make sure our house is completely in order.”

Roseville: Warning, traffic ahead

Roseville is a historic railroad town, but its modern history is more about cars. That’s problematic.

Like Folsom, Roseville sat quietly as Sacramento County’s suburbs boomed. But since 1990, Roseville has tripled its population and at times was one of fastest growing cities in the country.

The city landed several major computer companies as employers in the 1980s. But new Roseville really introduced itself as a regional player when it opened one of the largest auto malls in the country in 1989, the Roseville Automall, followed in 2000 by The Galleria shopping mall.

Those malls boosted Roseville’s tax base and made the city a retail sales powerhouse on par with the city of Sacramento.

City residents have done well also. Nearly two-thirds own the home they live in and median house values this spring were high: $462,000. Roseville’s household median income is solid at $81,000 in recent years according to the census, though residents lag neighboring Rocklin, where income was $92,000 and home prices slightly higher.

South Placer’s car culture, though, is now clogging the Highway 65 and Interstate 80 interchange. Placer officials want to rebuild the interchange, but they don’t have the money. A bill now in the legislature would allow south Placer communities to put a localized transportation sales tax on the ballot next year.

Roseville City Manager Dominick Casey is blunt: The highway widening project was needed yesterday. Roseville and south Placer’s quality of life and economic health rely on mobility. Drivers are escaping the clogged freeway by cutting through and jamming city streets. “If that (tax measure) is not successful, there are transportation improvements needed today that won’t be funded for 20 years.”

West Sacramento: Respect, finally

In 1987, when West Sacramento became a city, leaders had a modest ambition: Win some respect.

The area’s few neighborhoods were poor and bracketed by warehouses and industrial shops. The community had no downtown and no identity, other than perhaps a notorious one for its motel-row red light district.

Now, West Sacramento is making others jealous. It has the fastest rising median income since 2000 of the 25 communities analyzed and had the fastest rising home values between June 2000 and June 2019.

But home ownership levels remain below average. And the percentage of residents with a four-year college degree lags behind Roseville, Elk Grove, Davis and Folsom.

Still, the city appears on track to become the most modern city in the region in the next decade as it redevelops its waterfront into a walkable, European-style addition to downtown Sacramento. Those plans include community gardens, dense housing and offices, two new bridges across the Sacramento River, community rideshare programs and some form of urban rail transit crossing the river.

The city has been chipping away for 20 years. It knocked down an old state highway that led to Tower Bridge and had divided the city. Then it ripped out the rail line that separated the city from the river and replaced it with a pedestrian and cycling trail. The city landed the River Cats baseball team and got a stadium built.

The Park Moderns town homes near the river are among the most distinctive residential architecturally in the region. An outdoor riverfront entertainment venue called Drake’s at the Barn has become the civic meeting place city leaders around the region are searching to create in their communities.

City voters have notably been willing to try new things. They passed a tax measure in 2008 to build a streetcar system connected across Tower Bridge to Sacramento. That project has stalled. West Sac may try for a light rail extension over Tower Bridge instead. In 2016, voters approved a tax that funds a preschool and college financial support program, funds homeless intervention and a city subsidy to try Uber-style shuttle buses.

Mayor Christopher Cabaldon says the city is experimental because it had lacked so much for so long that people felt they had little to lose. “We are willing to take some chances,” he said. “Complex problems involve complex answers. We have a ways to go still.”

Davis: Island college town

The city of Davis is secluded by geography – and by choice. Growth is often not a welcome word, making the university city a place where young minds come to be trained, then leave because they can’t find housing or affordable places to start businesses.

Home prices have risen more sharply here than nearly any major community in the last two decades, with a median value of $671,000 in June, according to Zillow. That is second highest among the 25 communities, behind Granite Bay.

City voters control whether new development should be allowed on adjacent farmland. They notably voted down a combination housing and business research and development park next to UC Davis in 2016. They did however approve an active adult community last year.

Slow or no growth is normally a recipe for stagnation. But thanks to an innovative and growing university, Davis has maintained an attractive identity, a healthy downtown and a smart resident profile. In a region where slightly more than 30 percent of residents have a four-year degree, the Davis number is an astronomical 74 percent (A few of those Davis grads do in fact find a way to stick around.)

When Davis does add housing, it usually isn’t run of the mill.

The newest, The Cannery, is a dense urban-style community that boasts a farm, a barn, a community center and fruit stand. However, some homes there are listed for more than $1 million. And tiny Aggie Village offered small houses, close together, each with a separate rental cottage in the rear. The housing was initially offered to university professors as long as they did not already live within 30 miles of campus.

Elk Grove: Houses yes! Jobs, not so much

Elk Grove is the anti-Davis. Since 1990, Elk Grove has gone from 17th to second largest among the Bee’s 25 communities, trailing only the city of Sacramento. That includes an annexation in 2004 of the existing Laguna West area.

Elk Grove home ownership rates are solid. And, despite being hit by the home mortgage meltdown in the 2000s, nearly three out of four Elk Grove households today own the house they live in. That’s far above the regional average of 60 percent.

Home prices also are above the regional average, but still more affordable than Folsom and Roseville.

Elk Grove has become a go-to destination for Bay Area emigrees, some of whom are keeping their Bay Area jobs. Elk Grove households earn $86,000, one of the highest median incomes in the region.

Elk Grove’s Achilles heel is that it doesn’t have the job base that Sacramento and Rancho Cordova do. Residents must commute on average 31 minutes to work on increasingly congested freeways, especially Highway 99, according to census surveys.

The city recently expanded its annexable land area south of Kammerer Road in hopes of turning farm fields into job centers, and is marketing other nearby sites to businesses, without takers at the moment.

City leaders meanwhile now want to extend light rail south of its current Cosumnes River College terminus into Elk Grove to offer commuters an alternative to congested Highway 99.

City of Sacramento: The center (finally) holds

Sacramento remains the region’s central city and home to the area’s bedrock state government workforce. With that comes the responsibility to maintain a strong economic, civic and social center. During decades of mass migrations to suburbia, then to exurban cities like Roseville and Folsom, it struggled to do that.

Now, the center holds again. Golden 1 Center, built in 2016, has been a magnet for visitors and has helped create renewed urban core investment, solidifying Sacramento as the retail and entertainment heart of the region, as well as its key jobs center.

Sacramento Kings’ principal owner Vivek Ranadive has grandly called the downtown area around the arena the region’s “communal hearth.”

The core needs more housing, though, to become a full community – and notably to satisfy people looking for an alternative to the region’s increasingly congested suburban freeways. Central city officials hope to encourage construction of 10,000 new housing units in the next decade. The city has been inching forward on that, but so far builders are finding it easier to finance fancy $700,000 town houses than inexpensive apartments that baristas and service workers can afford.

A test case is about to open at 19th and J streets. Nikky Mohanna, a 28-year-old developer, is finishing construction of a residential tower with some “micro” studio units she plans to rent for less than $1,000 to young workers. “It’s an efficient way of living,” said Mohanna. “To be able to pay down your student debt. And not having to own a car.”

The city’s inner neighborhoods – Oak Park, Tahoe Park, Alkali Flats, Curtis Park, East Sacramento and north Land Park – also have seen a surge of infill housing projects, some of them significant in size, including The Mill at Broadway, The Creamery in midtown, Crocker Village, McKinley Village, The Grounds in Tahoe Park and upcoming Sutter Park in East Sacramento.

Citrus Heights: Sunrise’s sunset

Fifty years ago in the capital region, it was all about Citrus Heights, the country crossroads that stepped up to challenge the big city.

The fastest-growing community in the region in the 1970s, Citrus Heights birthed Sunrise Mall in 1971, with a Macy’s. Across the street, Birdcage Walk had one of the region’s first multiplex cinemas. They were flanked by restaurants, bars and dance clubs, creating a downtown in the suburbs to rival Sacramento’s struggling city center.

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Now, Citrus Heights’ retail realm has hit a tipping point, challenged by internet sales and newer shopping in Roseville and Folsom. The city population has barely budged in 20 years, and median household income, which was among the highest in the region in the 1970s, is now at $54,000, well below the regional average of $64,000.

Like Rancho Cordova, Citrus Heights has been doing house cleaning of less desirable businesses and conducted neighborhood cleanups.

And this month, the City Council launched a framework for redeveloping the Sunrise Mall area, with housing, retail, entertainment and offices. The site could become the city’s “living room,” officials say, morphing “from an auto-oriented suburban center to an amenity-rich, pedestrian-friendly, and experience-oriented regional destination.”

Granite Bay vs. El Dorado Hills: Who’s on top?

Twenty years ago, if you were a CEO, a Sacramento King, or comedian Eddie Murphy, these communities likely were on your house shopping list. The same goes now. So, which is more elite?

Based on median home price, it’s Granite Bay, where the average value is $785,000, according to Zillow. (A check last week of Zillow listings, though, found only a few houses available at that price, and many in the multi-million-dollar range.)

El Dorado Hills, at a $655,000 median in June, actually ranks below Davis, where the median was $671,000.

But the median household income in El Dorado Hills is $127,000, a statistical tie with Granite Bay’s $125,000.

Home ownership rates, again a sampling, are also essentially a tie with El Dorado Hills at 88 percent and Granite Bay at 87 percent.

Eddie Murphy? He chose Granite Bay for a hilltop holiday home in 1998, then sold it a few years later. It recently resold for $5 million.

North Highlands and Florin: Knocked down, but looking up

The Bee data provided some surprises, notably in North Highlands and Florin. These communities are geographically far from each other, but share similar historic economic misfortunes.

Both were hit hard economically nearly 30 years ago when the federal government closed McClellan Air Force Base, Mather Air Force Base and the Army Depot. Florin also lost traction when the big Campbell Soup plant closed in 2013.

Median family incomes in the areas dropped significantly, taking inflation into account, since 2000. And poverty levels in the area are high. Yet North Highlands and Florin, along with Rio Linda and Rosemont, have seen the biggest percentage increases in home values in the region other than Davis and West Sacramento.

That likely has benefited institutional real estate investors who swooped in and bought houses in foreclosure, but also benefited first-time buyers who couldn’t afford higher-priced communities. In the Florin area, Asian and Latino immigrants have turned Stockton Boulevard into an ethnic business corridor. Census data show that nearly one-third of Florin residents are now immigrants.

With prices still low by regional standards, Troy Givans, the county economic development director, said he thinks buyers now see “a value proposition” in those neighborhoods that the children of original immigrant settlers are taking advantage of.

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Tony Bizjak has been reporting for The Bee for 30 years. He covers transportation, housing and development and previously was the paper’s City Hall beat reporter.
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