Establishing a Framework for Rural-Urban Fringe Planning-Part 3

At present, many countries have already incorporated the concept of sustainability in each of their own developmental plans and programs. For instance, in Australia, sustainable development has become a buzz word in the planning arena. In South Australia,  ideas like “land-use planning must extend into economic, social and environmental spheres of strategy” and “ a long term flexible framework need to be linked with short term plans” are considered as key principles in strategic planning exercises such as the Adelaide 21 Project (Lennon, 1996). In the Philippines, the  acceptance of “sustainability”  as a very valid developmental goal has prompted the government to formulate the Philippine Strategy  for Sustainable Development  (PSSD) in 1987.

I believe that in essence, the concept of sustainability has fully feathered and may now be used as a yardstick  for objectively deciding what is good,  right, and fair. Therefore, it was deemed  appropriate to use this concept as a framework or guide in assessing the effectiveness and appropriateness of the rural-urban fringe  management system and land-use policies  in the Philippines. 

The relevant definition of what is an appropriate and effective policy would be that which would allow the highest and best use of land  in the rural-urban fringe based on all its economic, social and environmental attributes. Built-in to the policy should be a decision-making tool for identifying what is that  “highest and best use” of land.

“Highest and best use”  is defined by Frederick Babcock in his 1932 work as “that available  use and program of future utilisation of a parcel of land which produces the highest present value” (cited in Wendt, 1972, p.133).  Fisher and Fisher defined it as “a designated use of a spatial unit which will allegedly produce the largest net income over a given period of time” (cited in Wendt, 1972, p.133). Relatedly, the Appraisal Institute defined it as “that use which at the time of appraisal is most likely to produce the greatest net return to the land and building over a period of time” (cited in Wendt, 1972, p.133).

The three above cited definitions take “highest and best use” as a concept central to real estate finance  and said definitions clearly convey the principle of profit maximisation. Another definition of the same context is that provided  by William N. Kinnard, Jr. and Bryl N. Boyce in  An Introduction to Appraising Real Property.  According to them,  “highest and best use (highest and most profitable use; optimum use) is that reasonable and probable use which will support the highest present value as defined, as of the effective date of the appraisal (cited in Webb, 1980, p.58). These definitions however are applicable only in the financial point-of-view. Other factors such as risk (Webb, 1980) and  unquantifiable costs and  benefits  are bound to be left unaccounted for. In this regard, the concept of “highest and best use”  relevant to this research study is that which  will support the optimal realisation of  economic benefits by taking into consideration as much unquantifiable costs and benefits as possible. That means, the decision-making tool for identifying what is the “highest and best use” of a particular parcel of land must grow beyond financial analysis and approximate a full benefit-cost analysis   (BCA) if it is to internalise both the concepts of productivity and sustainability.