In Lexington County, the sound of progress is often a jarring thud from a car’s suspension hitting another pothole. While Lexington’s population has nearly doubled since 1990, according to the U.S. Census, and continues to skyrocket, the infrastructure meant to support this growth is visibly failing. The number of county-maintained roads in good condition has plummeted to 62% since construction in the ‘80s through ‘00s and is projected to fall by another 30% by 2030.
This is the daily reality of those in the 40,000-vehicle crawl along the North Lake Corridor and key intersections like U.S. 1, among many intersections struggling to handle traffic through increasingly dangerous bottlenecks. To complicate matters, the county’s 2,782-mile road network is carved up like a medieval fiefdom among state, county, and town authorities, making a coordinated response extremely tedious.
This physical decay is rooted in a financial reality that is simply unsustainable. The county faces a staggering $175 million backlog just to pave the 240 miles of dirt roads that residents have petitioned about for years. Against this mountain of needed spending, the primary funding source, the state "C" Fund from fuel taxes, provides a mere trickle of $6 million annually.
The math is unforgiving. With the cost to just resurface a single lane of road typically approaching $1.5 million per mile, according to the Federal Highway Administration, the current budget is functionally irrelevant to the scale of the problem. At the current rate, addressing just the existing dirt road backlog would take decades. Additionally, with fuel consumption dropping due to improved fuel efficiency and EVs sweeping the market, combined with Lexington’s fast-growing population pouring more vehicles onto the same strained corridors, it’ll be virtually impossible to pave those roads.
It’s not just roads
Lexington’s strained infrastructure is only one side of the growth crisis. The same rapid population increase that has overwhelmed the county’s roads has also collided with decades of restrictive zoning policies, creating a housing shortage just as urgent. While commuters crawl through bottlenecks on deteriorating roads, many of those same residents are struggling to even find a place to live that’s affordable and accessible.
This shortage is no accident; it stems directly from the first set of zoning ordinances, implemented piecemeal beginning in 1976. These rules created an almost Soviet-style preference for single-family homes while not even including mixed-use districts, making apartment, multi-use and multi-family construction nearly impossible. Under current regulations, Low Density (R1) zones allow a maximum of four units per acre, Medium Density (R2) permits eight units per acre, and even the so-called High Density (R3) zones cap out at just 20 units per acre — and only if they’re located along four-lane roads.
With such restrictions in place, combined with Lexington’s surging population, median home prices have soared to $270,305 in 2025, while average rent has hit $1,533 per month. Homes now sell in just 45 days in what’s consistently described as a ‘very competitive’ market. This excludes young families, forces seniors to stay in homes too large for their needs and pushes essential workers like teachers and firefighters to live farther from their jobs.
The Smallwood Cove debacle illustrates this dysfunction in dramatic fashion. A $733 million lakeside resort community planned for 93 acres on Lake Murray, proposing 1,100 residential units, two hotels, a conference center and a retail space, would have brought major investment and much-needed tax revenue to the county.
Instead, it was slaughtered by public opposition so fierce that Town Councilman Todd Carnes said in a piece by News19 that he had “never seen that ... kind of public input ... for development.” Its withdrawal sent a clear message to developers and businesses: Lexington County is closed for business.
The Lexington Paradox
What happened with Smallwood Cove was not an isolated flashpoint but a symptom of a deeper, self-reinforcing cycle in Lexington County. Infrastructure neglect fuels daily frustrations, frustrations harden into opposition against growth, opposition translates into restrictive policies, and those policies ultimately choke off the very development that could expand the tax base needed to repair the infrastructure in the first place. This is the essence of the Lexington Paradox.
Lexington has trapped itself in a self-destructive feedback loop. Years of underfunding left roads and services visibly crumbling. That erosion of trust breeds public anger, which turns into fierce opposition against new development. Politicians then react with tighter restrictions, which further choke off growth, and with it, the very tax base needed to fix the failing infrastructure.
This dysfunction is now formalized through policies like the April 2021 moratorium on large-scale residential developments and proposals to cap apartment complexes at 200 units with three-mile separation requirements.
The paradox is that, beneath this dysfunction, Lexington’s economic fundamentals are remarkably strong. Lexington Medical Center alone employs 6,500 people. Amazon, Michelin and UPS all anchor operations here. The county’s pharmaceutical manufacturing concentration is 4.3 times the national average. Unemployment is just 4.0% and median household income tops $75,000. On paper, it’s a picture of prosperity.
In practice, that prosperity rests on a foundation that’s cracking. Each day, 124,000 residents leave the county for jobs elsewhere, while 107,000 others pour in. This massive cross-commute degrades the roads, yet those who drive in contribute nothing to maintaining them. Thus deepening the very deficits the county can’t afford to fix.
The solution: taxes for thee
Breaking the Lexington Paradox requires more than frustration and moratoriums. It requires money. The cycle of crumbling roads, opposition to growth and shrinking tax capacity cannot be solved without a significant and reliable funding source. Yet, so far, the solutions placed on the table are inadequate at best.
A proposed $30 annual vehicle registration fee would raise only $9 million annually, while unfairly burdening residents as visitors use our roads for free. Developer impact fees, while already generating $7 million in private road investments in the Town of Lexington, face fierce opposition from the Home Builders Association, which claims proposed fees add $50,000 or more on top of existing $31,000 in fees to home costs, worsening the already tough housing market.
Perhaps there is a more fair solution. The proposed Capital Project Sales Tax (CPST) seemingly represents the best chance to break this destructive cycle. This 1% sales tax could generate upwards of $536 million over eight years, with $382,195,140 for road improvement and repaving, $76,327,808 for dirt road paving, $69,497,052 for intersection improvements and $7,980,000 for bridge projects.
This isn’t just another tax; it’s nearly 90 times Lexington’s annual “C” Fund allocation, offering genuine potential for transformative change. As Councilman Larry Brigham admitted, “We’ve explored every option that we knew to explore to try and help fund the roads, and this is the answer.”
Richland County’s successful “Penny Tax” ought to be used as a model. Since 2012, it has funded $656 million for roadways, $301 million for public transit and $81 million for greenways and walkability projects. The transparency and visible results led to its renewal in 2024: proof that voters will support infrastructure investment when they see tangible results.
At the end of the day, the residents who killed Smallwood Cove were right about one thing: uncontrolled development without infrastructure is a disaster. But their solution to simply stop development is economic suicide. The real solution is to build the infrastructure first, then welcome the development that pays for it. That’s not sentiment, it’s the only path forward and it’s just common sense.