By Anne Jordan

While their services may be focused on cyberspace, information technology companies still need physical space for their operations and personnel.

A growing problem, however, is that when dot-coms show an interest in locating downtown — often for the cachet associated with funky digs or a more cosmopolitan culture — landlords are quick to quadruple the rent, and low- and middle-income residents and longtime businesses wind up being displaced. Witness the much publicized backlash in San Francisco’s Mission District against the construction and renovation boom fueled by Internet start-ups. The issue has become so contentious that two propositions are on the city’s November ballot to limit high-tech growth in some neighborhoods.

On the other hand, if tech companies erect their corporate complexes in the suburbs, as has largely been the case with the technology corridor in Northern Virginia, they can become major contributors to sprawl. A controversial plan to build a new Potomac River crossing between Virginia and Maryland, for example, is being backed by the region’s increasingly influential high-tech honchos, despite protests that it would wreak environmental havoc on an area that is largely agricultural.

In more and more places, the goose that laid the golden egg has turned into an ugly duckling. And citizens are starting to demand political leadership that so far has been lacking when it comes to overseeing tech-driven development. If there has been a guiding principle among local officials since dot-coms burst onto the scene several years ago, it’s “the more the merrier,” since they’re considered a “clean” industry.

But as other problems — such as a shortage of affordable housing and a slew of transportation woes — are clearly being exacerbated, if not created, by the technology boom, politicians and planners need to step up to the plate with a vision of how to achieve some sort of balance between its economic benefits and quality-of-life issues.

Several recent news stories indicate that that may be starting to happen in a handful of places. Palo Alto just enacted an emergency ordinance prohibiting high-tech firms from moving into street-level retail spaces. Three other California cities — Redwood City, San Mateo and Menlo Park — have also passed limits or temporary bans on new high-tech development. In essence, they’re calling for a “time out” in order to assess their situation.

The District of Columbia zoning commission has stirred up controversy by restricting the development of data centers or telecommunications switching stations, which the city’s planning director has dubbed “dead zones” because they house equipment but few employees. While critics are saying that D.C. is shooting itself in the foot, Mayor Anthony Williams’ aim is to focus on recruiting job-generating tech businesses.

Some local leaders, at least, are acknowledging that not all tech development is created equal and that revenue is only part of the equation when it comes to deciding what will have the most positive impact on the community. Unfortunately, that lesson still appears to be lost on the San Jose city council.

A few days ago, it approved a plan by Cisco Systems to build a nearly 700-acre campus in the rural Coyote Valley that is expected to host 20,000 workers — and even more parking spaces. While the project will surely secure the city’s standing atop the new economy, the downplaying by local leaders of its effects on the area’s roads and housing is completely irresponsible. After all, they don’t reside in the Silicon Vacuum.

Anne Jordan is managing editor of Governing.

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