Arbitrage in the Grass

jc-mg-200-names.jpgJon Christensen writes: Last year I was at a workshop in which a city official suggested that what we need to do to change water consumption patterns in Los Angeles is "villainize the lawn" like we've villainized plastic bags.

Turf Terminators did just that. But now, it seems the tables have turned, topsy turvy, and the villainizer is the villain.

Concerns have circulated in hushed voices for months as more and more people have seen yards after Turf Terminators is done with them. Recently more vocal dismay has spread on social media as Turf Terminators has eliminated lawns in more and more neighborhoods. Last month, landscape architect Mia Lehrer and colleagues wrote an op-ed for the LA Times pleading "Don't gravelscape L.A." And last week, the LA Weekly ran a story headlined "Turf Terminators has gotten rich turning yards into gravel, but is it creating blight?"

At first this seemed like such a nice, entrepreneurial "doing well, by doing good" story.

Turf Terminators will remove your lawn and install drought tolerant landscaping for free. How can they make money doing that? They take the rebates the Los Angeles Department of Water and Power and other agencies offer homeowners for removing turf. And the Terminators take care of the paperwork too. Your water bills go down, LA conserves water during the drought, and a new business thrives, creating jobs. Win, win, win, win, no?

Stanley L turf terminators 600.jpg

At bottom, what we have here is a curious kind of arbitrage: buying a lawn to destroy it at low cost and selling the missing lawn at a higher cost at the same time. Turf Terminators effectively buys your lawn at the low cost of ripping it out and putting in a few plants and gravel or mulch. The company then sells your former lawn to the DWP, for example, for the higher value of DWP's rebate--$3.75 a square foot--and pockets the difference. And you get left with a pretty minimal yard because the marginal profit for Turf Terminators on each yard is not huge.

You can't blame Turf Terminators for finding a good business opportunity and going after it aggressively. And they're not the only ones doing this. They're just the biggest, having converted more lawns than anyone else so far.

This all only works at scale, of course, even when you bring the environmental concerns into play. Turf Terminators and any competitors offering to tear out your lawn for free will only succeed by going big--tearing out lots of lawns cheaply. And significant long-term water savings will only come from widespread adoption of less thirsty landscaping.

But while lawns may be a good enemy, beauty should not be. It can be quite lovely if you switch your yard from turf to xeriscaping. Even better if one or two of your neighbors follow your lead. And better yet if that creates a tipping point, as Emily Green, who writes widely on these issues at thinks it will, and then the rest of your block goes along. Pretty soon you could have a beautiful, varied landscape of plants in your neighborhood that is not only good for conserving water, but great habitat for other creatures, and pretty to boot.

Or not. Instead of a uniform block of lush green lawns, you may find yourself in a uniform, hot block of bleak gravel dotted with a few beleaguered plants.

What's most worrisome about all of this is that Turf Terminators' business model is based on exploiting people's best intentions to do good, while profiting from public incentives to encourage desirable changes. It's a mutually reinforcing circle. It could be virtuous. Or, it turns out, not so much.

Beware the law of unintended consequences. As time goes by and more and more public money goes into these well-intentioned rebates and then into Turf Terminators and its competitors, this combination of good intentions and incentives could turn Los Angeles into a city that is ever more unpleasant to live in. At what price are we arbitraging our future?

There have to be better ways. And there are. Some advocate for more stringent requirements for rebates, such as banning gravel and artificial turf, designating which plants qualify for rebates, protecting trees for shade, and creating landscaping that will absorb water better. Emily Green notes that if we were pulling up vegetation and taking water off of such a wide swath of wild landscape it would require an Environmental Impact Statement.

But how far can and should regulations go in defining people's personal options on their own properties?

The other way is for people to remember there is no free lunch--and no free lawn removal. You get what you pay for. So take the rebates. And rip out those lawns. But, remember, beauty may cost a little more, and take a little more thought, planning, and even sweat equity.

The good news is that your property and your city will be better for it in the long run.

Thinking about ripping up your lawn? Good idea. But first read Emily Green's "After the Lawn" series at KCETLink.

Photo courtesy of Yelp reviewer Stanley L., who gave Turf Terminators four out of five stars.

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