Friday, July 31st, 2009
High Speed Rail and Transit Roundup
Wisconsin is ordering Talgo rail cars capable of 200 MPH operation. These will be placed in service on the Amtrak Hiawatha line for now. This seems to be an effort to build HSR support in Wisconsin, boost its chances of federal funding, and to secure the US manufacturing site for the trainsets.
A mix of federal and state funding is finally getting the CREATE program off the ground in Chicago. This is designed to both dramatically reduce freight rail congestion in Chicago, and also to boost passenger service (Metra and HSR) by building several overpasses.
The CTA “Max” car experiment on the Brown Line came to a halt. This was where seats were removed to make more room for standees and expand capacity. Apparently passengers hated them. That’s why you do a trial. And I think this was definitely a good experiment to try. Kudos to the CTA for first doing it, then being willing to back track when it didn’t get the passenger response they hoped for.
The Tribune has a great story on the private rail car that runs on Metra’s UP-North line.
John McCarron writes in favor of investment in metro transit over high speed rail. (Thanks Robert Munson)
Here’s an awesome op-ed on rational public transit policy from a director of the Bay Area’s BART system. (Hat tip Human Transit)
Best Cities for Singles
Forbes has another one of their controversial lists out, this one their annual “Best Cities for Singles“:
- #3 – Chicago
- #9 – Milwaukee
- #14 – Cleveland
- #19 – Minneapolis
- #23 – St. Louis
- #24 – Pittsburgh
- #28 – Columbus
- #31 – Indianapolis
- #34 – Detroit
- #37 – Kansas City
- #38 – Cincinnati
Given the Midwest bashing of most Forbes surveys, it’s good to see at least some places here get some love.
Newspapers and Urban Culture
There was a mini-furor in online communities in Columbus about this article about dining in Columbus. The Dispatch apparently runs these type of “Where I Eat” articles profiling various locals. In this version, a woman talks about Applebee’s being her favorite restaurant, as well as saying that’s where she would take someone new to Columbus.
Now, nothing against this woman personally. In fact, I’d have to second her endorsement of Potbelly’s, chain though it might be. But there is a legitimate concern about what type of message this is sending about Columbus. I’m not saying newspapers need to be civic boosters, but what is the journalism value in something like this? And how was this person selected?
Clearly, stories like this only allow people from larger cities to have a laugh and reinforces the prejudice against smaller Midwest cities that exists out there in the world. Editors should take care to consider not just how articles will be perceived locally, but also nationally and internationally in the age of the internet. I’m sure there are many fine local restaurants in Columbus, and to cherry pick someone who says Applebee’s is their favorite place does the city a disservice.
The Louisville Metro council has to approve the creation of a new tolling authority to pay for the Ohio River Bridges Project. Some councilors who wanted to have more debate and hearings introduced an ordinance for that which was shot down. However, the recitations section had an amazing collection of facts worth noting. Here is an excerpt (hat tip Broken Sidewalk):
WHEREAS, the Ohio River Bridges Project (ORBP) is now estimated to cost $4.1 Billion; and
WHEREAS, State of Kentucky traffic counts indicate that traffic in Spaghetti Junction did not increase from 1992 to 2007; and
WHEREAS, in 2008 traffic volumes declined by more than 11% on the Kennedy Bridge and by more than 5% in Spaghetti Junction; and
WHEREAS, according to the Texas Transportation Institute 2009 Urban Mobility Report, congestion in Louisville “stayed relatively constant” over the decade from 1997 to 2007; and
WHEREAS, according to INRIX National Traffic Scorecard, in 2008 traffic congestion in Louisville decreased by 39%; and
WHEREAS, six years of actual traffic counts are now available to compare to the assumptions in the ORBP 2003 Environmental Impact Study; and
WHEREAS, a November 2008 study conducted by Wilbur Smith and Associates for Kentucky Transportation Cabinet (KYTC) determined that an alternative which included only an East End Bridge provided the same “system wide performance” as the Ohio River Bridges Project;
There’s a lot more, but I found these particularly compelling. Broken Sidewalk also has even more great 8664 coverage. And a hot off the presses series of pictures that will either make you cry or drool depending on your perspective.
There’s plenty of talk of brain drain and people being sucked up into global cities. But a counter-trend is starting to attract notice as some become disenchanted with high costs and other hassles. And it is affecting surprising places, such as Scranton, PA, which is now growing in population again.
There’s a distinctly white-collar movement behind Scranton’s comeback. A return of college-educated natives from cities like New York and Philadelphia is fueling a population rise and a civic makeover. Bringing them back are the very small-town qualities many once wanted to escape: the likelihood of meeting acquaintances and relatives on the streets. The embrace here of modest ambition. The deeply held belief — only heightened by ridicule from the outside world — that Scranton matters.
For six decades Scranton lost an average of a thousand residents a year, many bound for college. The return of even a fraction of them — along with their families — could confer substantial economic benefits. “There was a diaspora of Scrantonians, and now we’re inviting them back,” says the Chamber’s Mr. Burke. The group has a campaign called Rediscovering Scranton, which includes a Web site with testimonials from returning natives.
A population rise of about 3,000 in the last two years, to about 75,000, has given hope that the long exodus is over. School enrollment is up to 10,000 from 8,500 seven years ago. And downtown is buzzing with the sounds of construction. A Radisson hotel is in the city’s old train station. Other recently vacant buildings now house advertising agencies, architectural firms and financial offices, many started by professionals who have returned.
Cities like Scranton lack a lot of urban amenities. While those are to some extent needed to attract people, they can also be a lagging indicator. The amenities are built in response to people moving in, and its feeds on itself. Here’s another perspective from NPR. Definitely something to watch, though to early to call a major trend. More like “green shoots”.
“Starchitecture” in Action
If you needed any more indication that starchitecture as currently practiced is past its sell-by date, check out this piece in the Las Vegas Weekly about this Frank Gehry building:
A Lesson in Skepticism
A group of people put out a hoax proposal to turn Central Park into an airport. Here’s their proposed map of the site:
This came complete with a realistic web site, as well as Facebook pages and a Twitter account.
I don’t think this really fooled anyone, but what I find interesting is just how similar to almost every real proposal the rhetoric was. For example:
New York City is the cultural and financial capital of the world. It is also our nation’s most densely populated urban area. Yet surprisingly, New York City has no viable airport. JFK, La Guardia and Newark may work for people who live in certain outer boroughs. But they are not an acceptable option for the majority of New Yorkers, requiring travel through some of the most congested traffic arteries in the nation. A journey which by train takes nearly two hours and by automobile can take up to three hours. For a place which purports itself to be the greatest city in the world, this is not a workable model.
Or this from their FAQ:
I own an apartment alongside Central Park. What will Manhattan Airport do to my property value?
History has proven that bringing a transportation amenity to an underserved region elevates the perception and economic well-being of the area. In the past, these types of transformative public works projects have created an influx of interest and new investment in the neighborhoods in which they have been built. There may be some who resist the progress. But as neighborhood residents, small business owners and local civic organizations begin to experience the economic “trickle-down” effect these types of large scale redevelopment projects have precipitated time and time again; Manhattan Airport will be embraced.
What about the environmental impact of building Manhattan Airport?
Research shows that single-passenger car-service and taxi trips between Manhattan and JFK/EWR/LGA account for up to 9% of automobile-created carbon-based emissions in the region. Reducing our environmental impact is a major concern for all of us and preliminary findings indicate that building Manhattan Airport can be a critical first step as we strive to live up to our long-neglected environmental responsibility
I think we’ve all got to admit that the arguments in favor of most projects don’t sound much more impressive than this. They are plausible stories about what would happen, backed up by research that it is difficult to independently evaluate. History has shown that our cities have built way more than their fair share of “Manhattan Airports” based on this exact type of faulty reasoning, many of which had to be ripped out later at significant cost. Of course, not everything will work out as planned and any entrepreneurial venture has high risk of failure, but we should at least look at these things with clear eyed realism. That includes, of course, even the things I’ve spoken in favor of.
Economic Development Roundup
“Unconventional Thinking” A counter-argument to convention center led economic development strategies.
“Failure is not an option; it’s essential“. Thoughts on the culture of innovation.
Failure to invest in new power transmission lines endangers the wind power revolution.
A Ball State University study says city-county mergers don’t help economies.
National and International Roundup
President Obama launches his Office of Urban Affairs.
The NYT Magazine profiles President Obama advisor Valerie Jarrett.
The NYT had a great article on cities that are uncovering long buried waterways, focusing on Seoul. In previous years it was not uncommon to bury urban streams into underground channels that doubled as sewers. Now cities are turning these back into surface streams as recreational and neighborhood amenities.
Let the water wars commence. A landmark federal ruling says Atlanta can no longer draw water from Lake Lanier unless it reaches a water sharing agreement with surrounding states. It has three years to do so. This is big, big news so stay tuned to this one.
Apparently highway spending isn’t the stimulus it was envisioned to be.
The Where Blog has the best collection of High Line photos I’ve seen yet.
The New York Times is exploring whether they can implement a foundation model for news.
The latest from Brookings I’ve yet to digest: “The New Geography of United States Immigration“
Oh, and those Marxists in Toronto (they describe themselves this way, btw) who hate Richard Flordia? They now have their own web site.
O’Hare’s New Runway Improves Arrival Times at Airport and Unclogs US Airways (WSJ) – The title says it all. Keep it coming!
Chicago, City That Works? (Tribune op-ed)
Bid to raze Western Ave. overpass takes shape (Tribune) – Hmm – I don’t think I support this one. Traffic on Belmont is already a nightmare.
Changing strategy direction in Cleveland (Ed Morrison @ BFD)
Proposal for new form of Cuyahoga County government gets on November ballot (Plain Dealer)
Plain Dealer Wants to Profile from Cleveland’s Carcass (Roldo Bartimole @ Cleveland Leader)
Quicken sets mid-2013 target for new Detroit home (Detroit News) – Quicken to move HQ downtown, bring 2,200 jobs. A big win for Detroit.
Is right-sizing the right fix (Free Press) – via @GreatLakesGuy
Is it time for Milwaukee to Consider a Combined City-County Government (Urban Milwaukee)
Is it time to dissolve Milwaukee County government? (Milwaukee Talkie)
City of Steel (and other stuff) to Get Its Turn on the World Economic Stage (NYT) – G20 meeting to be held in Pittsburgh
Pittsburgh Scrubs Up for Visit From the G20 (WSJ)
Cray supercomputers to bring 225 employees to downtown St. Paul (Minnesota Public Radio)
Wednesday, July 29th, 2009
There was big news in Louisville last week as Mayor Jerry Abramson announced he would not seek re-election as mayor in 2010 but instead would seek the Lt. Governor post running on Gov. Steve Beshear’s re-election ticket in 2011.
This is a watershed moment in Louisville politics. Abramson is one of those towering figures, a man who has served five terms as mayor of the city, first prior to consolidation, then, after a brief voluntary hiatus in the private sector, as Louisville’s only mayor of the post-city/county consolidation era. He has been the dominant figure in Louisville politics for the entire time I’ve been old enough to understand such matters. (I only have a brief remembrance of Harvey Sloane as mayor as a child). His tenure and influence over the city is comparable to that of Mayor Daley in Chicago.
Abramson has never lost an actual public election. He’s long been an extremely popular figure and few have really dared to challenge him. But recent times have seen the Abramson magic touch lose its appeal as a series of scandals and populist movements have put pressure on him. Most notably, the 8664 movement (which I’ve endorsed) opposing a new downtown bridge positioned itself squarely against Abramson’s stance, and a wide range of groups have criticized the city’s real estate dealings with the Cordish Company out of Baltimore. Abramson retained a hammerlock on the C-J editorial page, but a collection of critical blogs and anti-Abramson movements began to pick up steam.
While almost the entire establishment stayed with him, I began to notice the same types of dynamics that were present prior to the surprise defeat of Indianapolis Mayor Bart Peterson in 2007. I’d have to say that Abramson was probably more vulnerable than ever in his career, and getting out isn’t necessarily a bad move. And let’s face it, after 20 years as mayor, it is probably time for some new blood. As someone recently told me, the problem with Abramson is that “he sucks the oxygen out of the room”. He so dominates Louisville’s politics that there is no room for any other voices. That’s probably not good.
Still, when looking back, I think it is easy for people to take for granted all the positive changes and momentum that Abramson brought to the table. Back in the 80’s, Louisville was a struggling place, hit hard by the ’80-’82 recession and economic kryptonite as a result of the “strike city” moniker it earned in the 1970’s.
Abramson brought a needed dose of change to the city. While no one could have prevented the declines in manufacturing employment, Abramson was extremely successful at preserving the Ford assembly plant operations. He also was instrumental in bringing the UPS air hub to Louisville, which has arguably been the greatest economic engine of growth in the city. And unlike most sorting hubs, this is also a headquarters operation. UPS Airlines, one of the largest in the world, is headquartered in Louisville, with large white collar employment including, for example, around 900 IT positions. YUM Brands and others were also lured to town or retained.
But it was as a champion of downtown Louisville that Abramson most made his mark. Like many cities, Lousville’s downtown declined mightily. It too experimented with failed fads like pedestrian malls that ultimately did more harm than good. Abramson led the charge in trying to turn this around. The Kentucky Center for the Arts opened just before he took office, as did a small downtown mall called the Galleria. That mall failed like many, and Abramson brought in Cordish to redevelop it as an entertainment venue, though not without controversy. He also expanded the convention center, built a downtown minor league stadium, upgraded facades in the Main St. historic district, and lured a series of cultural institutions downtown such as the Louisville Slugger Museum and Muhammed Ali Center. His creation of Waterfront Park might be his biggest highlight. A new downtown arena is under construction. The 21C Museum Hotel and its restaurant Proof have gotten national media attention.
The focus on downtown shows what I consider to be the mixed legacy of the mayor. As I have long put it, he has 20/20 vision for downtown, can still make out shapes as far as the city limits, but is totally blind beyond its borders. That’s changed a bit of late, but Abramson is still extremely downtown-centric and city-centric.
This dynamic influenced the bridges debate. When support was building for an East End bridge, which even a cursory glance at a map shows to be an obvious link, Abramson was horrified that traffic would be able to bypass downtown. He opposed this span and instead proposed a new downtown bridge instead. The result is the “compromise and build everything” Ohio River Bridges Project we have today.
His worldview was also on display in the debate over airport expansion. Louisville’s airport was small and landlocked. There were various proposals floated to build greenfield airports in Jefferson County or Southern Indiana, but Abramson was adamant that any airport expansion had to take place inside the city limits of the fairly small Louisville. He prevailed on this and ultimately displaced thousands of residents and businesses to build a parallel runway at Standiford Field. UPS is taken care of, but Louisville’s airport remains small and landlocked, with flight paths over many heavily populated areas.
And of course he hated the Caesars riverboat casino in Indiana. Actually, he pretty much hates all economic development in Southern Indiana, since his tax base is heavily dependent on commuter taxes paid by Hoosiers. The results of his opposition to all development outside the city limits has been a history of poisoned regional relations. This will likely haunt the city long term. Once Jefferson County is full and development spills into the collar counties, Louisville is likely to experience the same sort of dynamics as Indianapolis and Cincinnati. A really big difference between those cities is that Indy has had solid regional relations and Cincy very poor ones. The differences are clear in the differing results those cities have had. I think Louisvillians instinctively get this. One reason I believe merger passed after two previous failed attempts is because county residents realized they were now starting to become part of the “inner city” too.
The enlarged scope of post-merger Louisville expanded Abramson’s vision as well. He’s been a big supporter of the City of Parks initiative, which is aiming to build a necklace of parks and trails in outer Jefferson County, for example. I think this is one of the greatest initiatives any city anywhere has going on.
Abramson’s new role seems curious. It’s not an obvious step up from Mayor to Lt. Governor. With Sen. Jim Bunning retiring, that might have been a more interesting choice. Perhaps he felt that anti-Louisville sentiment in Kentucky, which is very strong, would have made it hard for him to get elected. Former Jefferson County Judge-Executive Mitch McConnell made the move from Louisville to state politics, but it wouldn’t have been a slam dunk for Abramson.
And the Lt. Governor role opens up an interesting possibility for Abramson to leave possibly his most important legacy. I noted the strong anti-Louisville sentiment elsewhere in the state. Some years back the C-J even had an editorial cartoon titled “Other Bridges Louisville Needs to Build”, showing bridge building to the rest of the state. If Abramson is able to spend this campaign and four years as Lt. Governor building bridges between Louisville and the rest of Kentucky, finding a way to make common cause together, the positive impact of that on both Louisville and the state can not be under-estimated.
Despite my problems with Abramson’s downtown-centricity, I can respect that he was motivated by a desire to make Louisville great. This is clearly a guy with a burning passion to make sure that Louisville stayed in the game among cities in its general size tier. His general enthusiasm for the city and role as Louisville’s “Cheerleader in Chief” has been key to building positive momentum in the city. Given that it is materially smaller than many of those places, making it happen has been no small feat. It might seem impossible that Louisville could go the way of say Dayton, Ohio. But without a guy like Abramson at the helm in the 80’s and 90’s, I think that could have been more a possible reality than people are willing to consider.
It will take some time to judge Abramson’s legacy. Major parts of it like the bridges project, the arena, and the city center project are yet to be written. But on the whole, I think you’d have to say that Abramson’s tenure has generally been positive for the city. And I give him a ton of credit for a lot of the good things that happened in the last 25 years. If Louisville is on the map today, then Jerry Abramson probably deserves a lot of the credit.
Coverage of Abramson’s Decision to Not Seek Re-Election
C-J Special Section on Abramson
Jerry Abramson Timeline
City can survive without Abramson, leaders say
Candidates line up to replace ‘Mayor for Life’
Tuesday, July 28th, 2009
[ I linked to this piece from my last post, and it proved popular in some quarters, so I’m re-running it here. This post originally ran on February 26, 2007. ]
As my name should tell you, I’m a big lover of cities. I’d much rather vacation in some large metropolis than a sandy beach. I’m a fan of the “great indoors” of the coffee shop, museum, cinema, or opera house much more so than any outdoor activities. Among my urban pursuits is independent cinema. Not too many other people seem that interested in many of these flicks, however, so I often end up seeing them by myself. Now this doesn’t bother me too much. I’m pretty self-sufficient. I learned at an early age that if you are into things that aren’t mainstream, you’d better be prepared to do them alone.
What I find interesting though is the high number of other people that attend these events by themselves. I was particularly noticing this over the weekend as I took in a film. Over half of the audience was people attending by themselves. And it really struck me that this is possibly one of the signs of a strong urban culture. If you are in a place where lots of people are out attending obscure events on their own, this not only shows that you’ve got patrons for them, but you’ve got people with enough passion and self-confidence to go out and do it by themselves in a culture that typically doesn’t see people going to films, concerts, etc. alone. I don’t think there’s any profound insights here, it’s just something I’ve observed.
Monday, July 27th, 2009
A Chicago icon is in danger as Prairie Avenue Books, a huge architectural specialty bookshop, is on the verge of closing. Among its problems: people are coming in to browse then buying for cheaper on the internet. I’ve been to Prairie Avenue (which is actually on Wabash Ave.) and it is definitely worth a trip. The atmosphere is more library than bookshop, which I guess is part of the problem.
This story powerfully illustrates the force of the changing economy and some of the lesser known effects of the internet and globalization. We hear a lot about “spiky cities” and how the global economy is concentrating ever more activity and economic life in a handful of global cities. Chicago is one of those cities, one of the big winners.
Yet even Chicago is not immune to the forces of economic transformation. Any number of its treasured institutions have been hit hard. Chicago once boasted a vibrant independent bookstore scene, but today it is largely chain central, with Amazon.com probably being the bookstore of choice.
More significantly, what this shows is that cities like Chicago are losing their lock on the unique attributes that once made them cultural oases in an otherwise totally drab landscape of “Generica”. Once, if you wanted to be able to buy specialty books about architecture, you almost had to be in once of America’s hand full of top tier cities like Chicago. Now you can be anywhere in America. Amazon.com puts a better selection of architectural books within the grasp of my hometown of Laconia, Indiana (pop. 29) than Chicagoans had access to a mere 10-15 years ago. Amazing.
I used to think about what it would mean practically to relocate from Chicago to a second tier Midwest city. What important things would I have to give up? I identified two major items: live opera and clothing. But heck, today even these aren’t a problem. While most small cities have only tiny regional companies, the Met Opera HD simulcasts beam the best of New York City into the Midwest’s smaller cities. I’ve never actually attended, but I’m told by opera aficionados who have that it is better than being in the theater.
Similarly, sites like styleforum.net and Ask Andy About Clothes give me access to in depth information about everything form the cutting edge of fashion to classic tailored clothing. And the internet lets me order almost anything ready to wear or off the rack from the comfort of my own home.
Think about it. Fifteen years ago if you moved from Chicago to Columbus, Ohio, it would have been like getting exiled. Even getting a decent cup of coffee would probably have been a challenge. Today, that’s no longer the case. While Chicago certainly has more and better stuff than Columbus by a mile, people in Columbus today have access to urban amenities that Chicagoans didn’t only a short while ago. You can enjoy opera, clothing, a nice meal out, great coffee, local agricultural products, etc.
This is the counter-trend of the global city phenomenon. This is the Friedmanesque flattening phenomenon in action on a micro scale and it has important implications.
- It means that, despite the economic advantages that accrue to major global cities, much of the advantage that they previously held over other places has been in fact eroded. The gap between Chicago and Columbus in terms of urban amenities is now a matter of “more and better” whereas before it was a matter of “have and have not”. Those are very different equations to someone evaluating a move.
- Smaller cities should have reason to believe they can attract talent – if they get their act together. Some major knockout criteria have been eliminated. Indeed, we’ve seen the rise of smaller cities like Portland and Austin and Charlotte. The highest value added functions of the global economy may continue to be located in global cities, but there are plenty of other things smaller cities can do if they are able to leverage their new opportunities and attract the talent necessary to pursue it.
While the Amazon effect could theoretically reach anywhere, I don’t see it really filtering down to much smaller places, at least not ones without universities, or to rural and small town areas. It might enable a few people here and there who want those environments to do so, but I believe, and trends seem to back this up, that people who like these urban amenities like the stimulation that comes from being able to enjoy them with others who feel the same way. And the critical mass of people like that has always been in cities. I wrote before about the “aloneness of an urbanophile“, and indeed most urbanites aren’t afraid of doing things by themselves, but few people want to be perpetually like that.
Will the Midwest’s smaller cities find a way to make this work for them? Time will tell.
Friday, July 24th, 2009
This is the last in my two-part mini-series on good economic development in Indianapolis. As I said, there’s a reason that Indy is the fastest growing large metro area in the Midwest and is one of the best performing economically. It’s not all just good luck.
This one focuses on Indy’s internet marketing cluster. This is a group of nearly 70 companies locally that are focused on the marketing space, totaling over 1,000 employees. This includes companies that are both profitable and rapidly growing such as Exact Target (which recently raised about $75 million in VC funding) and Compendium Blogware, both based downtown. These companies are still actively hiring in the recession.
What’s good about this? Lots of things I’ll outline:
1. It’s a focused micro-cluster. It combines both emerging high tech trends such as software as as service, with good old fashioned business expertise of which Indy has plenty. Again, so many places have “high tech” strategies. But high tech is about as broad a category as can be. Neither Indy nor any other Midwest city is Silicon Valley and never will be. So having more focus in areas where these cities can bring to bear unique expertise is important. The future does not belong to the megalithic employers of yesterday. It belongs to clusters of smaller companies that in aggregate add to up to what an old school factory or corporate HQ used to bring. If one of these companies gets big, that’s great. But bigness shouldn’t be the goal. You add up a few of these clusters like this one, motorsports, etc. and you start to have the makings of a diverse urban economy.
2. It is a collection of many companies. This is important. If you only have one dominant employer in a particular industry, labor is going to think twice about taking a job there. If you are out, you’re gone. But in this marketing cluster, you’ve got lots of choices, and there are always new ventures being formed. It’s less risky to be in this business in many regards.
3. It is an ecosystem. The beauty of having lots of diverse companies within a cluster is that they create a network providing business services that span the value chain. This might be irrelevant nationally, but locally it has important benefits. If you looking to start a company in Indy, high tech or no, you can get access to most of the cutting edge marketing services you need locally and as sort of default choices. The critical resource in almost any business is management time and attention. If you start a business in Indy and want to do email marketing, you just hire Exact Target and you’re done. You can spend your precious bandwidth on other things rather than researching marketing service providers. Also, since they are local, you can physically show up at the office if there is a problem, something not to be discounted.
Jane Jacobs talked a lot about why large cities were fountains of entrepreneurship and innovation. One things she noted and illustrated with several examples was how so many new enterprises were able to find all the components and services that they needed locally. Come up with the greatest idea in the world, but if you have to scour the globe to find everything you need, you are operating at a huge disadvantage to those who have everything they need easily at hand.
4. It is building a culture of serial entrepreneurship. One of the things that has been less common in the Midwest than the West Coast is entrepreneurs who go on to new ventures after cashing out of their last one. But we see here people who have worked at multiple startups. Compendium Blogware founder Chris Baggott, for example, was also one of the founders of Exact Target. That doesn’t mean that either or both of those companies couldn’t ultimately fail, but at least there are two bets on the table that have the chance to pay off. Doug Karr, who works with Baggott as Compendium, is on his fourth company in the space.
5. It’s collaborative. The leaders and employees of these businesses know that they aren’t necessarily in competition with each other, and that anything that builds tech success in Indy only makes it a better and more attractive location for all such businesses. As Tory Burk put it, “What is impressive is the existing collaboration between these leading marketing technology companies. We all want each other to be wildly successful, we all believe Indianapolis is the greatest city to start and grow a company, and we truly support each other (through partnerships, integrations, joint events, and resources)”. And as David Castor said, “I work with SaaS companies all over the globe – but I find very few places where SaaS companies support one another like Indy.” One way they do this is through industry forums like SaaS CEO Executive Roundtable. These types of knowledge sharing organizations are critical.
6. Perhaps most importantly, these businesses employ lots of non-techies with traditional Hoosier skills. As Baggott noted, “Another point on this is that most of these jobs are not necessarily ‘Tech’ jobs. 80% or more of the employees of these companies never touch code. They deal with customers and prospects….something that really takes advantage of our strengths in Indianapolis.”
This is critical to recognize and trumpet. Leaders are trying to renew the economies of our states to be relevant in the 21st century. But so many of the targeted industries are oriented towards the educated elite – life science and high tech come to mind. If you are a lower skilled worker who just got laid off, why would you want your tax dollars going to support this? The majority of Midwesterners don’t have college degrees. How does the new economy benefit them? It is imperative that we are able to make real in a tangible way how focusing on new economy companies benefits the average person in our communities. For example, most Hoosiers don’t know much about developing software. But they know a lot about things like sales, customer service, being a receptionist or other office service worker, etc. These types of companies need those kinds of skills. Not every job is an elite knowledge worker job. And that’s actually a good thing.
7. This is an organically developed industry. This cluster spontaneously came into existence. It wasn’t a result of a top down program to create the next big industry. This means it probably has a lot more staying power. I believe that government programs can do a lot to create the conditions necessary for certain target industries to flourish, but ultimately there’s always a question of whether the industries so created can survive without subsidies. And if your town never produces industries without subsidies, that calls into question its real economic health. I’ve illustrated several examples of the “top down” type economic development success in Indy. Here is a great example of bottoms up. And it’s something that has been enabled through the pro-business atmosphere that prevails locally. Again, as Baggott put it, “What’s great about Indianapolis is, the government stays out of my way.”
So there is a lot of goodness here. I don’t want to claim this is a super-unique to Indy thing. I think most successful Midwest cities can point to similar examples. And I’m sure most cities have marketing services locally available. I’m just using this an example. Feel free to share similar examples from your city.
I think this cluster also shows one other great thing about the Midwest generally, namely that it is focused on companies that are designed to generate actual profits. So many Silicon Valley startups are about build it and they will come type products where the founders hope to find a way to make money later. Even hugely popular services like Facebook and Twitter make virtually no money.
In the Midwest, people start businesses to make money. This is probably considered a weakness versus Silicon Valley, but could it be simply a differentiated strategy? And perhaps one that is more relevant to the age we live in at that? As Doug Karr put it, “In other parts of the country, tech is tech and startup capital runs like flowing honey into any dumb idea without a revenue model. Here in Indianapolis, the leaders of our companies have grown out of hard work with solid business models.” The best known exponent of this approach is Chicago based software company 37Signals. They literally wrote the book on the topic, Getting Real, which is definitely worth checking out. Is the focus on actual business models something that could drive Midwest success in the future? Time will tell.
More Indianapolis Economic Development
Wednesday, July 22nd, 2009
[ This article is very, very draft and really would require a lot of research and analysis to do properly, so please keep in mind its provisional nature. It’s almost just the sketch of a concept ]
Why have so many Southern cities proven to be vastly more demographically and economically successful than those of the Midwest? When you look at the problems that supposedly plague the Midwest – low educational attainment, poor physical fitness, minimalistic government services, unsightly built environments – you find that the South is actually in worse shape on many of them. Yet it outperforms.
Let’s not overstate the case. Much of the South is impoverished and not successful. Cities like Memphis and Birmingham are not on many people’s lists to emulate. But the list of successful cities is impressive: Atlanta, Charlotte, Nashville, Austin, Dallas, Houston, and Raleigh all come to mind. Now these are sprawlburgs to be sure and not the types of urban environment many would want to live in. But given their growth they clearly appeal to a lot of folks, and let’s face it, most Midwestern cities are sprawlburgs as well.
Conventional wisdom would ascribe this to climate, low taxes, and lower cost non-union labor. And there is some of this to be sure. But I’d argue that cultural factors play a major role as well, notably the historic aristocratic character of the South, combined with a clear-eyed self-awareness these cities have about their standing in the world.
Alexis de Tocqueville is justly famous for his “Democracy in America”. Beyond just being arguably the greatest book ever written on America, it is also notable for its contrast of the aristocratic social state and the democratic one. Tocqueville was a great admirer of democracy, but he also saw clearly that with the passing of aristocracy, something would be lost.
Aristocracy was based on hereditary class divisions, rooted in a particular geography. For those at the top, their greatness was self-evident. This led to a strong sense of self-regard and belief in the possibilities of what they could achieve. As Tocqueville noted, “In aristocratic society, the class which gives the tone to opinion, and has the supreme guidance of affairs, being permanently and hereditarily placed above the multitude, naturally conceives a lofty idea of itself and of man. It loves to invent for him noble pleasures, to carve out splendid objects for his ambition. Aristocracies often commit very tyrannical and very inhuman actions; but they rarely entertain grovelling thoughts; and they show a kind of haughty contempt of little pleasures, even whilst they indulge in them. The effect is greatly to raise the general pitch of society. In aristocratic ages vast ideas are commonly entertained of the dignity, the power, and the greatness of man.”
Now the South was not an aristocracy, but its slave economy and plantation culture gave it some of the characteristics of one. The plantation owner was a like a feudal lord, and the slaves his serfs. And the class gulf between the two unbridgeable. Plantations homes even resembled manor houses. Indeed, even long after the passing of slavery, many of the places populated by hereditary blue bloods are Southern (and of course Northeastern). Places like Mobile or Charleston. Places where your pedigree still matters.
Among the aristocratic characteristics that survive in the South today are an immense attachment to native soil, and exceptional pride of place. This reaches its apex, of course, in Texas.
Then you have the Irish and Scotch-Irish heritage of much of the south, and its clear influence on the social state. James Webb in his book “Born Fighting” notes the importance of this culture and its fierce individualism and warrior spirit to America. Other cultural stereotypes might include a lack of concern with aesthetics (often remarked upon), hot headedness and quickness to take offense, and frugality. Perhaps the greatest prominent embodiment of this was Scotch-Irish President Andrew Jackson, who famously fought several duels.
Combine the aristocratic traits with those of the Scotch-Irish and you get the Southern city culture. Namely, places with a significant attachment to their particular locale, high ambition, and an in your face braggadocio and swagger about it all.
The contrast with the Midwest could not be more clear. The Midwest, largely settled by Germans and Scandinavians, is historically less individualistic, with more permeable social class, less attachment to place, and with a premium on modesty, decorum, etc. As Tocqueville noted, with a democratic social state the average state of man is higher than in an aristocracy. The worst abuses and excesses do not exist. But nor are lofty heights reached. The lows are higher but the highs are lower.
What this results in is Southern cities that are hungry and ambitious, and Midwestern cities satisfied with the status quo and which value the comfortable middle. I’ve noted before that the failure of the Midwest is to a great extent a failure of ambition. I’m reminded again of what Bob Morgan, head of the Charlotte Chamber of Commerce said:
“To understand Charlotte, you have to understand our ambition. We have a serious chip on our shoulder. We don’t want to be No. 2 to anybody.”
It’s tough to imagine a Midwest city other than Chicago having this attitude. (Interestingly, the origin of many Chicagoans is different from that of the rest of the Midwest. There were huge numbers of Irish immigrants (similar to the South) and also a lot of eastern Europeans. What role did that play in shaping the character of Chicago?).
When you don’t even want to win the prize, it’s hard to do so. Most Midwest cities are just happy to be here. Southern cities have an unquenchable thirst to succeed. Perhaps neither way is right or wrong, but clearly the Midwest way is not economically successful today and people are voting with their feet to move South.
One other difference I notice, and I have no clue where this comes from, is that despite the bravado of these Southern cities, they are keenly aware of their deficiencies, often to a far greater extent than the Midwest. I’m known as a tough grader, and when I write about Midwest cities I frequently get dissent from the local booster clubbers. But when I wrote a couple of pieces on Nashville, noting not just the many good things about it but also its weaknesses, the people on the Nashville message boards said, “Yup, you just about nailed it.” Nashville might be printing up t-shirts saying they are the “New Los Angeles”, but they also know that they are lacking the high culture department, for example, and are peddling hard to catch up. In this case, they built the brand new Schermerhorn Center to house their orchestra and also have spent a lot of money to boost its budget and significantly raise its artistic levels.
Most Midwest cities seem oblivious to the world around them. They will talk about how great they are to be sure, but this is a hollow boosterism. It’s not based on any desire for greatness. Rather, it is just a marketing line. A lot of these places wouldn’t know world class if it landed on their heads. The world is passing them by and they don’t even know it. Again, Richard Longworth noted how Midwest cities and states have no idea what is going on next door to them, much less around the country and around the world.
Is there hope for change in the Midwest? Time will tell. But it is imperative to up the ambition level and benchmark realistically against world, not to just sit there sullenly while Midwest cities sink into the mire. Given the deep historic roots these behaviors seem to have, however, change is likely to prove very difficult. But if the impoverished, racist South could change and turn it around, it doesn’t seem impossible that the Midwest eventually could as well, particularly if some outside forces broke its cities out of their current pattern.
Monday, July 20th, 2009
In my recent blog survey, someone made a comment that really made me pause and think: “I respect that it’s one of the few urban planning blogs to talk about black people and their roles in the community.“
It is unfortunately true that so much urbanism discussion is about things – buildings, transit lines, roads, etc. But cities are first and foremost about people.
Our Midwestern cities have large African American populations and a robust black cultural life. Being from this part of the country, it is impossible for me to imagine a city without black people on the street. Whenever I visit a city with very few black people, it just seems “off” to me, like there is something missing or wrong.
The first black president in history is from Chicago. Incidentally, he’s the first president of any race from these parts in quite some time. Right now in Indianapolis, the Indiana Black Expo Summer Celebration is wrapping up. This is possibly the largest ethnic or cultural festival of any kind in the entire country. Michael Jackson, arguably the world’s greatest entertainer at one point, was from Gary, Indiana. Detroit is famous for its Motown legacy. Halle Berry is from Cleveland. Langston Hughes was born in Missouri and also spent many years in Cleveland. The list of distinguished African Americans with Midwestern roots would probably fill up one of my mega-long blog posts.
Yet African Americans tend not to feature prominently in urbanist discussions of our cities and their future, save perhaps in hyper-segregated Detroit. I can understand that people are hesitant to forthrightly discuss race because it is a subject matter that is sensitive. But perhaps there is nothing more important to talk about.
Race has arguably been the most powerful force shaping our cities. Racism, the Great Migration, civil rights struggles, fair housing, busing, block busting, white flight, riots, public housing, the emergence of black political leaders and especially mayors, red lining, and so much more. There is a long history there, much of it we can’t be proud of.
We can’t roll back the clock and start over. We are where we are. It’s about how we move forward. Institutionalized racism has been significantly eliminated. Social attitudes have changed a lot. But clearly race is a subtext in almost any discussion of urban issues, from transportation, to crime, to education, to neighborhood redevelopment, to regional governance. Anyone who thinks we are totally beyond racism should spend some time reading the comments on articles of their hometown newspaper web site.
In nearly all of our cities we see a black community that has not shared in civic success or which has disproportionately been hit by civic failure. This is not only a disgrace, it will block those cities from finding urban success properly so-called. No city that leaves an entire segment of its community behind can truly claim success, no matter how many gleaming towers or swanky restaurants it might have.
I will make two arguments for cities with significant black populations. One, those cities will never be truly successful or achieve their aspirations if their black populations do not share in civic progress. Two, one of the strongest predictors of urban success is how a city engages its black population.
Consider Atlanta. It has been one of America’s fastest growing regions for a long time. It has a heavy rail subway system, significant urban infill development, the busiest airport in the country, many corporate headquarters, a strong entrepreneurial culture, and a core city population boom that puts any Midwest city to shame, including Chicago. It should not be surprising that Atlanta has long been a major African American center, was known as the “city too busy to hate”, and today is arguably America’s premier city for African Americans. Good for black people has meant good for white people too. Contrast with nearby Birmingham, Alabama and see the difference. Once those cities were about the same size, by the way.
Or consider Houston. Another massive Sunbelt boomtown. This is the city that opened its doors to tens of thousands of New Orleans residents displaced by Hurricane Katrina, mostly black. Many of them decided to stay on in Houston. Houston sees attracting these new African American residents not just as charity, but as good for Houston’s growth.
I think it is time for Midwest cities to step up to the plate. You always see these civic strategies that talk about “building on assets”. Well, one of the greatest untapped assets of our cities is their African American populations. Why not look there to find not just a group that needs help, but rather a potential growth engine for the community? I won’t claim this will be easy to figure out. But it is imperative that we start.
It starts with education. There is nothing more important to success in the modern economy than a quality education. I am reminded of research Richard Longworth cited in “Caught in the Middle” about how even in economically ravaged Michigan, most white people still don’t see education as critical. The Midwest has never put a priority on education, even for its white majority. Hence its educational attainment levels. Imagine then the priority that has been put on urban districts with majority black populations? I think we are all familiar with the state of our inner city schools. I won’t claim this is a Midwest specific problem, or that the school system is entirely to blame, but clearly education is the absolute first step on the road to success for anyone, black or white.
I’ll have more to say on this topic in the future. But to wrap up this post I thought I would provide some data to give some perspective on our Midwest black communities. The data below is the percentage black population in the core county of a given metro area. For comparison purposes, the United States is 12.3% black. This data is as of the 2000 Census.
- Chicago (Cook County) – 26.1%
- Cincinnati (Hamilton County) – 23.4%
- Cleveland (Cuyahoga County) – 27.4%
- Columubs (Franklin County) – 17.9%
- Detroit (Wayne County) – 42.2%
- Indianapolis (Marion County) – 24.2%
- Kansas City (Jackson County) – 23.3%
- Louisville (Jefferson County) – 18.9%
- Milwaukee (Milwaukee County) – 24.6%
- Minneapolis (Hennepin County) – 9.0%; St. Paul (Ramsey County) – 7.6%
- Pittsburgh (Allegheny County) – 12.4%
- St. Louis (independent city) – 51.2% ; St. Louis County – 19.0%
As you can see, other than the Twin Cities, every large metro in the Midwest has a sizeable black core county population. A lot of places seem to have a core county population of around 25%.
It strikes me that it’s pretty hard to have a successful city if a quarter of your population isn’t coming along in the journey. So it is important for urbanists and those who love cities to be focusing on this in addition to (not instead of) things like attracting people who are already highly educated, drawing the middle class back to the center, downtown redevelopment, etc.
Saturday, July 18th, 2009
In the Midwest Milwaukee was #1 (#13 nationally) and Cincinnati was #2 (#15 nationally). It’s interesting to contrast this performance versus the metro areas that are normally top ranked.
City Population Estimates
The Census Bureau recently released city population estimates. Here is how my core cities stacked up in terms of core cities gaining population, and core cities losing population. The change data is year over year, 2008 vs. 2007.
Gaining Population (by greatest percentage gain):
- Columbus (+8,024; +1.1%)
- Minneapolis (+2,989; +0.8%)
- Chicago (+20,606; +0.7%)
- Indianapolis (+3,517; +0.4%)
- Kansas City (+1,888; +0.4%)
- Milwaukee (+1,836; +0.3%)
Cincinnati and Louisville each changed by less than 100 people
Losing Population (by greatest percentage loss):
- Cleveland (-4,265; -1.0%)
- Detroit (-4,878; -0.5%)
- Pittsburgh (-1,668; -0.6%)
- St. Louis (-1,302; -0.4%)
Indianapolis, Columbus, and Louisville all have annexed large “suburban” areas so it isn’t an apples to apples comparison. The fact that Louisville as a city was flat despite it being a consolidated city-county government is troubling.
For Indianapolis, we can use the population of Center Township as a proxy for the old city. Center Township gained 403 people last year, marking the third consecutive year of growth and accelerating growth. Could this indicate an inflection point for the core city? Time will tell.
I consider core city population growth a key measure of civic health, particularly in underpopulated places like Midwest cities. It’s great to see so many Midwest cities actually growing, even if it is not at a rate that would repopulate their cores any time soon.
Top States for Business
- #11 – Indiana
- #19 – Iowa
- #23 – Kentucky
- #26 – Missouri
- #29 – Pennsylvania (welcome Pittsburgh)
- #32 – Minnesota
- #43 – Wisconsin
- #45 – Ohio
- #46 – Illinois
- #49 – Michigan
Not an inspiring finish to say the least. California and New York were the two worst states. The best was Texas, followed by North Carolina, Florida, Georgia, and Tennessee. Given the economic performance we’ve in fact seen in these states, it’s hard to argue with the rankings.
Vanishing Fort Wayne
Vanishing St. Louis is one of the best blogs out there, chronicling the decay and demolition of the unique and historic urban fabric of St. Louis that is going on right before our eyes. Well, the author took a road trip to Fort Wayne, Indiana and produced stunning imagery that I hope he won’t mind my reproducing here. Please visit the main article on the lesson of Ft. Wayne.
Picture of downtown Ft. Wayne in 1960:
Downtown Ft. Wayne today, with all parking lots and garages, vacant lots, and empty lawn area shaded in red.
Indiana Government Center “Landscaping”
A reader sent in this photo he took of a man spraying what appears to be herbicide into concrete planters at the Indiana Government Center:
Here’s a shot of the results:
And what this looks like in context:
Think about how much more inviting this space would be if they actually planted things instead.
National and International Roundup
A major article in the Toronto Star suggests the bloom is off the rose for Richard Florida and his tenure there.
Even posh Mayfair in London has problems with vacant homes.
Planetizen also weighs in on shrinking cities with a piece called “Don’t Fear the ‘Dozer“
I may have mentioned this previously, but the National Trust for Historic Preservation is conducting a survey of mid-century modern homes in New Canaan, CT. It is great to see modern architecture getting increasing recognition as historically worthy.
Daniel Burnham Memorial: Design stirs spirits, but location stirs questions (Blair Kamin @ Chicago Tribune)
Architect Daniel Burnham’s vision still offers lessons (David Roeder @ Sun-Times)
The Second City is Becoming Second Home City (NYT)
36 Hours in Cincinnati (NYT Travel Section)
Second Ambassador span no longer needed (Detroit News)
City abandoned home plan: Fix it up or we tear it down (Indy Star)
Thursday, July 16th, 2009
Indianapolis is among the top performing Midwest cities on a number of measures. For example, it has the fastest population growth of any metro area over one million people and it is also among the best performers in terms of employment. It can be tempting to view this as a product of good circumstances or good luck – state capital, center of state, only large city in state, Eli Lilly, etc. And all of those are important to the city’s success to be sure. But I think it misses a lot of the flat out good decisions that good execution that have contributed, particularly in the economic development space.
I’ve highlighted some of these before, but I thought I’d start out another mini-series with more good examples.
First, I recently noted how many cities mistake real estate development for economic development. Indy hasn’t been immune to the lure of the large publicly subsidized real estate project. But when Indy has done it, it has generally been in the service of some greater strategy that paid off, such as amateur sports and events, not just a random series of “next big thing” projects.
This strategy created the Wholesale District, probably the best such revitalized multi-use district of any Midwest peer city and one of the top in the country. The city has a mall, an arena, stadium, convention center, and 4-5,000 hotel rooms all in a small area, combined with tons of restaurants and bars, along with some offices, residential space, and other destinations like the Mexican Consulate. Everything feeds on each other synergistically. This environment has been very attractive to events, creating a business that, as Gov. Daniels recently noted, is a “cash cow” for the state.
Just as one specific example, the new Lucas Oil Stadium. The Indy Star ran a recent article on all the events that it booked (as well as some challenges). What I found amazing about this is that notorious stadium critic Prof. Mark Rosentraub at the University of Michigan actually had some decent words to say about it. “In this economy, to be honest, I think Lucas is doing an amazing job.” And, “This was an investment in human capital to use the Downtown as a linchpin to attract highly skilled workers for Eli Lilly, banks, insurance companies, the kinds of workers we will need in the 21st century. When the economy is in good shape, these facilities will work.” This is from the guy who literally wrote the book on why stadiums are a bad investment.
Moving on, I wanted to go out on a limb and highlight something I think is a good strategy even though it is just getting started and hasn’t paid dividends yet. That is the new Energy Systems Network, the new economic development initiative focused around green tech.
I’ve long criticized the “me too” economic development strategies every single city and state seem to have in the hot sectors du jour: life sciences, high tech, green industry, and advanced manufacturing. It’s not so much that these are bad sectors to go after, but a completely generic, undifferentiated and unfocused strategy for a location with no competitive advantage just isn’t going to cut it. Alas, that’s what most of these are.
But when you look at this Energy Systems Network, a few things stand out. Once, it is largely a private sector led iniative. It’s another project of the Central Indiana Corporate Partnership. Now that, in itself, is not unusual as most cities have such a corporate vehicle that is the main backer of economic development. But here it looks like most of the investment is going to be coming from private companies pursuing actual products, not a government boondoggle fund.
The ESN is focused, looking at a few specific subsectors: wind and solar power, hybrid/plug-in vehicles, second generation biofuels, distributed power generation, and systems integration. Now, lots of people are chasing wind and solar, but for that one, so what? Power generation using those technologies is not a winner take all type industry like so many others that feature major clustering effects. And Indiana is doing well. Where nominally progressive states like Wisconsin are slow out of the gate with wind power, Indiana something like 14th in the country in it, and was number one in increasing its wind power capacity last year, with many more projects in the pipe.
As for vehicles, local companies have joined forces to collaborate on two initiatives. The Hoosier Heavy Hybrid group is looking at building more efficient trucks and something called Project Plug In is looking at a large scale pilot for plug-in vehicles and smart grid technology in Central Indiana. Could both of these fail? Of course. Entrepreneurial ventures frequently do. But that’s ok. And at least these guys are looking at specific things they want to do, not just a bunch of pie in the sky dreams. And there is a base of expertise to work from.
I do think corn based ethanol is bad energy solution, but given that Indiana has a large agricultural base, excluding that probably would have been politically impossible.
On the whole however, you see something here that is reasonably focused and looks at where Indiana can apply its expertise not to take over the world, but to get its fair share of the pie. And they are trying to do it with actual products. Compared to the marketing based initiatives you often seen in the econdev world, the contrast is clear.
More Indianapolis Economic Development
Tuesday, July 14th, 2009
Cleveland has been unfairly portrayed as the epicenter of the housing crisis in America. One publication after another, national and international, has piled on. Yet why here? Clearly the Inland Empire areas, Miami condos, Phoenix, and even Minneapolis have had very bad housing situations, many of them arguably worse than Cleveland.
I guess it is just easy to pick on Cleveland, the “Mistake on the Lake”, and tales of decline there fit with a narrative that people are already primed to accept. I’ll admit to not always being so kind to Cleveland myself. So today, I wanted to highlight a couple of great positive national articles about Cleveland, while also using them to other ends.
The first is a great New York Times piece on the rebirth of the Cuyahoga River. You may recall that this river famously caught on fire 40 years ago. Today, it is a totally different story.
The first time Gene Roberts fell into the Cuyahoga River, he worried he might die. The year was 1963, and the river was still an open sewer for industrial waste. Walking home, Mr. Roberts smelled so bad that his friends ran to stay upwind of him. Recently, Mr. Roberts returned to the river carrying his fly-fishing rod. In 20 minutes, he caught six smallmouth bass. “It’s a miracle,” said Mr. Roberts, 58. “The river has come back to life.”
On Monday, people who have worked for years to clean the Cuyahoga will celebrate at its banks. “It’s just remarkable,” said Steve Tuckerman, the Cuyahoga River specialist for the Ohio Environmental Protection Agency. “I never thought I would see in my lifetime, let alone in my career, such an amazing comeback of a river.”
America has cleaned up its waters greatly since the Clean Water Act. Still, the turnaround of the Cuyahoga is amazing. Once one of America’s worst polluted industrial rivers, now you can fish there. Contrast that with, say, the Indiana Harbor Canal, which remains unsafe according to every measure the EPA tracks.
But this article holds a cautionary note, not just for Cleveland, but for almost every older American city. Despite remarkable progress in creating a river you can fish in, Cleveland is still facing $5 billion in future costs to fully comply with the Clean Water Act. That’s not a mis-print. It really is $5 billion.
Cleveland is far from alone. Indianapolis faces $3.5 billion in costs. Cincinnati in excess of $3 billion. And so it goes. In city after city the largest public works project by far is some sort of sewer remediation project, often involiving so-called “deep tunnels”, to eliminate combined sewer overflows.
To put this in perspective, the previous largest public works project in the history of Indianapolis was the entirely new terminal complex at the airport that opened last year at a cost of $1.2 billion. The sewer project is three times that. It will exceed the cost of the aiport, Lucas Oil Stadium, the new convention center, Conseco Fieldhouse, Circle Center Mall, the new Central Library, and the Cultural Trail – combined. It should come as no surprise this is destroying cities fiscally. Jefferson County, Alabama (Birmingham) is on the verge of bankruptcy. Other cities will be forced to raise water and sewer rates to ruinous levels to cover the cost.
This may clean up the water to some extent but will have offsetting environmental harms that could be worse. First, many suburban areas already have separate sanitary sewers and effective stormwater management. Thus they may not have to incur any significant compliance cost in the future. With central cities like Indianapolis forced into tripling or more their already high rates, suburban districts like Carmel, Fishers, and Noblesville look even more attractive financially. Thus, sprawl is encouraged. This leads to more automobile usage and air pollution which is actually a greater danger to human health than CSO overflows, to say nothing of CO2 emissions.
I am a supporter of clean water. I believe in it. I think the Clean Water Act was a good thing and the Cuyahoga River cleanup illustrates why. But the last ten percent is the hardest to get. Looking at the cost/benefit from a purely local point of view, is there any way Cleveland will get $5 billion worth of improved public health, economic, or recreational benefits out of this project? It is extremely unlikely. And what is the opportunity cost? Huge. Think of what you could do with $5 billion. Cleveland could solve its abandoned home problem, renew a huge chunk of its infrastructure, build more transit, invest it back in lower taxes and fees, and much more – all things that could make a huge difference in that city.
If we as a nation want to realize the vision laid out in the Clean Water Act, then I think it is imperative to do so in a way that actually net helps the environment and makes central cities more, not less attractive. The easiest way to do that is for the federal government to pick up the bulk of the costs of compliance for CSO problems. Given that every city has spent years fighting with the EPA over this, I think it is fair to say there are no solutions that have been gold plated at the municipality’s request. And by the way, the deep tunnel project that everyone uses as the example of how to do it, Chicago’s, was largely paid for by the federal government.
If you wanted to name one policy that could help keep our central cities competitive, I would argue it is federalizing the cost of CSO overflow remediation, alleviating billions of dollars of crippling liabilities in almost every large metro area.
Bonus Good Cleveland News
To bookend this with another positive article about Cleveland, our friends at the New York Times had another great piece, this one on the East Fourth Street entertainment district. The article has a fantastic photo of a street filled with people drinking and dining at sidewalk cafes, but alas I can’t reproduce it.
About a third of the $110 million project is retail space and two-thirds is housing. The redeveloped area has 14 restaurants, eight bars, a 16-lane bowling alley, a coffee shop, a theater, a nightclub and a concert stage that attracts national acts. Above the restaurants, the developer, the Cleveland-based MRN Ltd., has built 322 rental apartments.
I must say, that putting in 322 rental units was very smart. That’s not a tiny number, and rentals are doing much better than condos in this market. Quite prescient. Plus the rent at 1,200 square feet for $1,200 is pretty good.
The article also shows the tenacity of the developer who brought it into being:
Most of all, East Fourth Street reflects the stubbornness and daring of Rick Maron, the founder of MRN Ltd…..It took seven years, Mr. Maron said, to identify, locate and strike deals with more than 250 separate landowners who held title to the properties. Mr. Maron said the slow pace enabled the family to settle on a development strategy and a public-private financing plan that enabled the street to develop organically over time, like a real urban neighborhood.
The article is worth a read.