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Sunday, April 29th, 2012

Replay: Megaregions – A Review by Aaron M. Renn

This review of the book Megaregions, edited by Georgia Institute of Technology Professor Catherine L. Ross, is the second in my three part series on megaregions. I put my cards on the table in my post with initial skepticism about the usefulness of the concept. I will follow this up with a look at potential applications of megaregionalism in the Midwest.

I was very struck by the quote at the top when reading the book. How often to do you find people questioning the very validity of the topic at hand when writing a piece for a book on it? The fact that Ross brings in people who are willing to ask tough questions about megaregions is a testament to her intellectual integrity. It would have been very easy to simply glom onto a topic that shows some early stage notions of being popular in the world at large and trying to flog it for all it was worth. Indeed, Ross is known on this topic, but here she takes an opportunity to shine a light on this emerging concept to see what she might find without excessive boosterism on the subject. As she notes herself in the book, “The quality of a new idea can be judged by the possibilities it creates, especially when such possibilities stimulate new and unbounded interpretations and allow more innovative and beneficial outcomes.” I see this book as dedicated to exploring some of those possibilities and trying to collect and develop frameworks for understanding it and applying it.

The book consists of thirteen chapters, each written by different authors, exploring some aspect of the topic, including looks at Europe and Asia. I will focus primarily on the United States, but don’t want to mislead into thinking this is a US only book.

One of the key questions to answer is, just what the heck is a megaregion? There are a few definitions, but the one I thought was best came from America 2050, a project of New York’s Regional Plan Association. They describe it as “a large, connected network of metropolitan areas that are joined together by environmental, cultural, infrastructural, and functional characteristics.” In short, it is a collection of linked metro areas in a given region. There is an entire chapter in the book devoted to ways to identify and delineate megaregions. And, of course, map them. Here’s the map America 2050 created using their approach:

A few things jump out from this map. First, the megaregion is really an eastern US concept. West of Texas, most of these regions have one main dominant metro, possibility with a satellite or two. The exception the Pacific Northwest “Cascadia” region. Second, the megaregion concept relies heavily on intuitive eyeball appeal. That is, we look at the map and see these clusters of regions and it just seems to make sense that they are related, apart from any academic methodology of boundary delineation. That’s not to say there isn’t logic behind the map, but I believe a lot of the popular appeal comes from its intuitive plausibility. America 2050 does a great job of recognizing this when they reference the cultural aspects of the megaregion. We think of, for example, the Midwest and Northeast as having distinct regional history, culture, values, and economic structures. This powerfully reinforces the intuitive appeal of megaregions. The idea is that we have cities in close proximity, with a lot of common culture and problems, so wouldn’t it be great if they figured out how to work together to solve them?

America 2050 doesn’t have the only map going. Richard Florida, a leading popular exponent of megaregions who wrote a paper on the subject with Tim Gulden and Charlotta Mellander called “The Rise of the Mega-Region“, used images of light emissions from the space to draw boundaries of areas that seemed continuously developed. Here’s his map:

Florida’s definition is based on continuously built up areas, but doesn’t necessarily imply any functional integration, though he has posited this is the case.

And here is the map that is being distributed with the Ross book’s promo materials:

Reading the book and looking at these maps really crystallized in my mind possibly the biggest appeal of megaregions to federal level planners in the Unites States and Europe, even though I have never seen it actually stated anywhere. Namely, megaregions are a convenient abstraction for federal level thinkers to make sense out of the large number of diverse metro areas in America and Europe.

Think about it, there are a huge number of metro areas in the United States. There are a bit over 50 metro areas of over one million people. The Brookings Institution Metropolitan Policy Program deals with the top 100 metros in America. These numbers are simply too high to give proper attention to each.

I’ve championed the notion that there is no one size fits all urban policy and that cities need to develop unique strategies and solutions based on their unique local context (see, “The Mayor as CEO” for instance). But think about it from the standpoint of a think tank in Washington or New York, or from that of Adolfo Carrión, director of the White House Office of Urban Affairs. How do you cope with policies for 250, 100, or even 50 metros? It would be extremely difficult. But it is certainly feasible think about 10-12 megaregions. I think that’s one reason why people so much want there to be validity to the megaregion concept. It provides a very convenient intermediate level of abstraction between the large scale United States (or Europe) and the fine grained detail of individual metro areas.

Brookings did this by positing a “Great Lakes” region to help organize a portion of its thinking. And I did too. As someone who has expressed skepticism on megaregions, I’ve got to admit that my own blog is to some extent a product of that thinking. One of the keys to its success was to pick a topic scope greater than the individual city (and thus to have more than purely parochial interest) but smaller than the nation (where I likely would never have been able to gain traction amongst long established big names). The 12 one million plus metros I focus on is conveniently similar to the total number of megaregions in the US (and the 12 Florida identifies in Europe). And I’ve been able to extrapolate out lessons from them that are relevant cross-regionally, and also to a broader audience as well. The metros of the Midwest actually have a lot of diversity. The strengths, weaknessnes, challenges, and opportunities of, say, Chicago, Detroit, and Columbus are radically different. They require very different policy approaches. Nevertheless, there seems to be some benefit in thinking about them together.

So apart from any real world manifestation megaregions might have, they are an important organizational construct in creating a hierarchy in any sort of large, multi-city geography like the United States or Europe. Megaregions enable people to conceptualize and manage these complex, fine grained territories. It is applying to metro areas the same regional aggregation concept used for functions like the Federal Reserve System (12 regional fed banks) or the federal district court system (11 appellate districts). That is, megaregions are necessary purely as a level in the hierarchy, even if they prove to be a phantom level. They can be defended purely on the basis of organizational and managerial theory even if they have no other application. Indeed, the fact that people persist in trying to find applications for them despite the lack of clear cut success to date shows that at some level they intuitively understand this organizational need.

Robert E. Lang and Arthur C. Nelson had a chapter that hints at this as well, noting that the mere act of formalizing a construct by the government causes people to start paying attention to it. Their example is how the OMB created the construct of “micropolitan areas”. Clearly the idea is that if the federal government created official megaregion definitions, and reported data against it, the concept would take on a life of its own by virtue of that. (Data collection would likely be trivial since megaregions would no doubt be made up of counties, such as by creating a layer above Economic Area). Their idea seems more to create something called a megapolitan area rather than a megaregion, however.

Tridig Banerjee has an interesting chapter further trying to refine the megaregion concept by identifying types of megaregions along a two by two matrix (which, with my management consulting background, I of course love). The dimensions are “galaxy” vs. “corridor” and “mosaic” vs. “network” (hierarchical). The Midwest would be a galaxy-network. Scott Campbell has a chapter asking a number of useful questions, such as the one at the top of this piece.

Ross herself seems particularly interested in the transportation aspects of megaregions, and this is one where it seems to have the most direct applicability. For example, most of the various high speed rail proposals out there revolve around megaregions. There are shared corridors of interest, such as interstate highways, and other important features, such as the Great Lakes. The question is whether these are items of relevance to a megaregion properly so-called, or if they are just the focus of ad-hoc “coalitions of the willing”. I actually suspect the latter as there are many of these (think of the I-69 and I-35 NAFTA corridor coalitions for example, or California’s high speed rail proposal) that exist independently of megaregions. In my view a megaregion would need to represent some true community of interest, in the way that a metro region does, to represent some sort of truly functional element, and I haven’t seen it yet. In fact, I have argued that even things like the Midwest high speed rail network shouldn’t be thought of as a network, but rather as a series of point to point connections linking outlying areas to Chicago. Chicago will not be an HSR hub in the way that O’Hare is a hub – that is, for traffic interchange. Indeed, in we see this in Europe, where there is very little transfer traffic of this type. There seems to be something to this megaregional transportation idea, but I’m not sure what is yet.

The piece I found most compelling was the chapter by Saskia Sassen. In my original piece on megaregions I noted that lots of people talk about them, but no one says what it is we should actually do with them in order to create real value. Sassen suggests how this might happen. Here’s an excerpt:

I argue that the specific advantages of the megaregional scale consist of and arise from the coexistence in one regional space of multiple types of agglomeration economies. These types of agglomeration economies are distributed across diverse economic spaces and geographic scales: central business districts, office parks, science parks, the transportation and housing efficiencies derived from large (but not too large) commuter belts, low-cost manufacturing districts (today often offshore), tourism destinations, specialized branches of agriculture (e.g., horticulture or organically grown food), and the complex kinds of agglomeration economies evident in global cities. Each of these spaces evinces distinct agglomeration economies and, empirically at least, is found in diverse types of geographic settings, from urban to rural, from local to global.

The thesis is that a megaregion is sufficiently large and diverse to accommodate a far broader range of types of agglomeration economies and geographic settings than it typically does today. This would take the advantages of megaregional location beyond the notion of urbanization economies. A megaregion can then be seen as a scale that can benefit from the fact that our complex economies need diverse types of agglomeration economies and geographic settings, from extremely high-agglomeration economies evinced by specialized advanced corporate services to fairly modest economies evinced by suburban office parks and regional labor-intensive low-wage manufacturing. It can incorporate this diversity into a single economic megazone. Indeed, in principle, it could create conditions for the return of particular activities now outsourced to other regions or to foreign locations.

I wrote a four part series in early 2009 called “Reconnecting the Hinterland” which was all about searching for value in attempting to foster a re-created interlinked economy between Chicago and the rest of the Midwest. An answer to Sassen’s question is actually what I was looking for. The simplified idea being, to find some economic activities in which geographic proximity, though not necessarily always in a dense, face to face setting like downtown Chicago, is a source of value; to ask, is there some medium between the “spiky world” of Manhattan and the Loop and the “flat world” of China and India?

I don’t want to jump the gun and go into detail, since that is a part of the next part in this series, but if you are interested, you might want two check out two pieces in that series, “Metropolitan Linkages” (about extended labor markets) and “Onshore Outsourcing“.

One curious omission from this book was the difference between megaregional and non-megaregional locations and whether there was some benefit to being in a megaregion. I can’t help but notice that in the Midwest, Kansas City (in most maps) and Des Moines are both outside of the megaregion yet are two the of the absolute best performing metro areas. Not being part of a megaregion does not appear to have hurt them any. I’d be interested to see some analysis on this.

In any case, for those interested in these things, this is a nice survey book to pick up. It is accessible to the general educated public, but is written in the style beloved of academics, so is likely to be very dry to all but those who are wonky about this stuff. Read the Sassen excerpt to get a sense of what is in store. For those who are in the planning or related fields, it is worthwhile to educate yourself on the megaregion concept to be able to parse a lot of the rhetoric out there about it. Reading this book would be a good way to do so.

I’ll leave you with this quote from Lewis Mumford’s The City in History, to give a perspective from one of the all time great screedmasters on this subject:

Instead of creating the Regional City, the forces that automatically pumped pumped highways and motor cars and real estate development into the open country have produced the formless exudation. Those who are using verbal magic to to turn this conglomeration into an organic entity are only fooling themelves. To call the resulting mass “Megalopolis”, or to suggest that changes in spatial scale, with swift transportation, in itself is sufficient to produce a new and better urban form, is to overlook the complex nature of the city. The actual coalescence of urban tissue now taken by many sociologists to be a final stage in city development, is not in fact a new sort of city, but an anti-city. As in the concept of anti-matter, the anti-city annihilates the city whenever it collides with it.

Don’t hold back Lewis, tell us how you really feel.

This post original appeared on December 6, 2009.

Thursday, April 26th, 2012

Common Driver Behaviors

Steve Vance, who co-runs the Chicago transport blog Grid Chicago, is a huge bicycle advocate. He put together the following short video from clips he shot cycling around the city showing how drivers commonly behave on the streets of the city. If the video doesn’t display, click here.

Thursday, April 26th, 2012

More Parking Madness in Providence

As a quick addendum to my Providence series, here’s a graphic put together by Greater City Providence that highlights all the parking in downtown Providence. As in most downtowns, it’s pretty staggering.

Tuesday, April 24th, 2012

First Time to the D by Alan Sage

[ This week I kick off another two part mini-series on a city from guest authors, this time Detroit. First up this travel piece from Yale undergrad Alan Sage. Next week Pete Saunders will check in with a book review - Aaron. ]

In the urban studies seminar I took last semester, our professor saved one day of class to tackle a surprise subject, one he would choose about a week before based on what the urbanist community was most heatedly debating at the time. So it came as no surprise when he sent out Philipp Oswalt’s opus on shrinking cities and announced we would be discussing Detroit.

Coming into such a wide field as urban studies, especially in a school where there’s no cohesive urban studies program but rather a smorgasbord of classes in various departments catering to specific interests, caused me a fair degree of trouble in deciding where to focus my attention. But the idea of shrinking cities captivated me immediately, as I imagine it has many other urbanists, perhaps because it is so simple a problem yet spawns infinite creative solutions. Ideas like urban farming appeal to my analytical side: there’s a poetry to the simple theory that as land value returns to the level at which it depends on what the land can produce rather than larger economic forces, its owners ought to appropriate its usage accordingly. Neighborhood stabilization techniques involving the eased acquisition of adjacent vacant properties, like the one Mayor Dave Bing is piloting right now, offer the same beautiful simplicity, harking to the idea of country estates, now economically possible given Detroit’s current land values.

But as these ideas captivated me, I realized that they might make sense theoretically but not practically; after all, while it’s great if a farm can bring fresh produce to a food desert, one doesn’t necessarily want to be walking by cornfields in inner-city Detroit after coming home from a late show, and who knows what kind of brownfield remediation expenses might be required. Filled with questions like these, I decided I would make a trip to Motown during spring break to see the much-discussed metropolis with my own eyes. After some attempts to convince my academic compatriots that the Motor City promised everything anyone could want in a college spring break, I realized I would be voyaging alone. But that was okay—for my French class, I had been watching a language learning program called French in Action, a story which centers on an amicable college student named Robert who takes a semester off from school to travel alone to Paris and “find himself.” I figured I would create my own version of French in Action, promenading on Woodward, Grand River, Gratiot, Michigan, and Jefferson: the Champs-Élysées equivalents of a city once called the Paris of the Midwest.

I landed at Wayne County Metropolitan around one in the afternoon on a hazy Tuesday, armed with a backpack and the address of Hostel Detroit, a quirky lodging in Corktown that seemed to be the perfect fit for my purposes. As my cab exited the Fisher Freeway onto Rosa Parks Street, the driver asked me if I had ever been there before. He seemed a bit disconcerted about my purposes for going to the desolate locale in “North Corktown” (the “East Williamsburg” equivalent of Detroit). The hostel inhabits the northeast corner of Vermont and Spruce, streets whose names invoked in my mind the images of a bustling American downtown. But other than the hostel, the other corners are all barren lots.

I heard the faint hum of French Canadian radio as I entered the hostel’s welcoming common room. I sought out the source of what sounded like Edith Piaf and found Michel Soucisse, Hostel Detroit’s skinny-as-a-twig manager, whose patronizing “Oh baby, this is Detroit” I would come to expect as the consistent answer to my naïve questions about Motown.

I dropped my bag on the bed and Michel laid out a guide to Detroit on the table. I told him a bit about my urban studies background, and so he shared his thoughts on living in a shrinking city. Originally from Quebec, he told me that Detroit was a place where people who’ve rejected mainstream society can come to create a society based on alternative principles. I received my first “Oh baby” when I asked him how often the 37-Michigan bus comes and how I should plan on getting around the city.

Equipped with knowledge of which restaurants warranted a visit, I left the hostel and headed to Mudgie’s, a “high ideal” deli serving up large quantities of locally grown produce. Along the way, I traversed Michigan Avenue, which felt safe but a bit unsuitable for walking on account of the building-street width ratio. I realized I wasn’t all that familiar with this sort of uncomfortable walking sensation, having spent my childhood in New York, a city where building heights are rarely low enough to offer pedestrians that undesirable sensation.

The crowd at Mudgie’s was surprisingly diverse. I knew Detroit was a 80-plus percent African-American city, but having seen the handiwork of gentrifiers in New York I expected there to be a hard-and-fast divide between the different communities. (Anyway, if you find yourself in the neighborhood, the Ivy was a delicious vegetarian option at Mudgie’s.)

My sojourn next lead me to the People Mover, an infamous transportation folly that I felt obliged to experience. It was while riding up the escalator at the Fort/Cass station that I had the first taste of the eerie aesthetic of Detroit. The downtown is much like a 70s science fiction fantasy, what with an automated monorail that no one rides and the GM skyscrapers at the Renaissance Center, which seem like a lair of evil if there ever was one. Beneath Detroit’s drôle de métro, it seemed like the elite presided over a dystopian empire of misery. I certainly hope I don’t sound like a proponent of ruin porn, but I’m not trying to separate the city’s inhabitants from the changes in its built environment. Rather, this sci-fi-esque ambiance is a product of urban planning initiatives that sought to turn downtown Detroit into a safe haven for the elite completely separate from other residents of the hulking metropolis. The People Mover and skywalk systems seem designed to allow people never to have to set foot on the once mean streets of downtown, and any economic development professional can tell you this means less potential for small businesses to profit off of foot traffic. And the Renaissance Center doesn’t exactly invite pedestrians to enter after stepping off of a DDOT bus—I certainly felt uninvited as I attempted to cross Jefferson Avenue on a windy afternoon.

My first night in the Motor City concluded at Seva, a vegetarian restaurant behind a trendy gallery in Midtown, Detroit’s culture capital. As I nursed a glass of $3 rosé, I felt like Robert in French in Action as he nursed a kir in the Closerie des Lilas. I think part of why I continually felt a similarity between Paris and Detroit resided in the sense that both feel like places one goes to find oneself. Both are cities of great reputation, one famous and one infamous, but nonetheless places where it feels like incredible events are always on the brink of occurring.

I hopped on the 53-Woodward bus after dinner, and switched at the Grand Circus to the 18-Fenkell. Ford Field and Comerica Park were both nearby, and as I waited for the 18 I ruminated on what had led planners to place large temporal structures in the heart of downtown Detroit. It seemed as if in the great urban redevelopment efforts of Detroit planners had thought very “approximately” about the effect of projects. Sure, the People Mover certainly seems like it would attract riders since it goes to all the important downtown sights, but if every place it goes to is within a 10 minute walk why would anyone waste the time to take the train? Stadiums seem like they’ll revitalize a city since they attract large crowds, but they’re temporal structures, only serving their intended function for a small percentage of the time. Of course very few structures serve their purpose 24 hours a day (which is why planners prefer mixed-use developments these days), but any sports arena will be on the far low end, only attracting large crowds at very, very specific times, rarely for long enough to spur much by way of nearby development.

After a surprisingly restful night in the hostel’s group room, I started my morning off with breakfast at a coffee shop on Larned Street right under the People Mover. After some thoroughly mediocre over-medium eggs and a cup of hot, black coffee, I headed over to the Rosa Parks Transit Center, where I would dérive around the city, taking whatever bus line caught my eye. On a whim I eventually chose the 48-Van Dyke/Lafayette.

After leaving downtown, we passed by tranquil Lafayette Park, which my professor from freshman year (and esteemed urban planner in New York) Alexander Garvin had described as a truly successful towers-in-the-park project. It turned out Michel lived in Lafayette Park, and told me he would never reveal how little he paid for rent lest New Yorkers descend upon a too-good-to-be-true deal. Michel told me an older resident of Lafayette Park once told him that news of the ’67 riots didn’t reach the neighborhood until well after the fact. I commented that it seemed secluded and lacking much by way of commerce, and Michel agreed, but added that it wasn’t a problem since there were a few grocery stores within a few miles drive. Perhaps the rules of mixed development that have such profound impacts in walkable cities don’t quite apply in the kingdom of cars.

Soon the #48 bus entered the East Side of Detroit that is familiar to followers of the mainstream media. I suppose I would be rehashing to write in detail about the rows of empty lots, burnt out buildings, and high ratio of abandoned to occupied commercial structures. But one aesthetic element I found particularly captivating was the design of store signs: a good many of them are hand-drawn. Although these weren’t the districts conquered by the creative class, I was reminded of what Michel had told me about Detroit being a place full of creative freedom. In Detroit, land is cheap enough that people can start the kind of grocery store for which a whimsical, hand-drawn advertisement is more appropriate than computer-generated signage. These ideas were confirmed when I visited Heidelberg Street the following day.

The landscape felt absurd as we passed a stretch of Van Dyke adjacent to an almost completely-vacated district, not too far from City Airport. We paused at a railroad crossing, and everyone moaned as the lights started flashing and the arms came down. But a sigh of relief was breathed when the engine revealed itself not to be dragging a long train, but a single car. The ambiance of the moment and surrounding area made me feel a bit like I was in a Don Delillo novel; there was a certain absurdity to the colorful abandoned storefronts in the midst of empty grids and frequent railroad crossings serving ever-decreasing quantities of freight. I imagined a future in which the bus would pause for the passage of an engine carrying absolutely nothing. If planned shrinkage were ever to be politically feasible, I imagine some of these neighborhoods near the airport would be the first to go.

After my trip through the East Side, I walked through the Eastern Market, which sadly wasn’t open on a Tuesday, looking for somewhere to lunch. The deeply industrial feel of the area struck me. Huge trucks passed up and down Russell, and the sheds where the farmer’s market is held on Saturday were gargantuan. I was expecting to see the touristy sort of farmer’s market one finds in New York, which is more to offer the luxury of fresh produce than to serve any sort of utilitarian purpose. But Detroit’s Eastern Market is a powerhouse of commerce, a market to rival any of the greats in Taiwan or China.

I ended up dining at a Thai place called Sala Thai housed in the abandoned Fire House No. 5. After a quick Pad Thai, I went back to the hostel and then on a long walking tour of Woodbridge. Having wandered around the digital streets of Detroit on Google Maps before arriving in person, I imagined Woodbridge and Corktown as some of the most dangerous areas. They seemed to possess a great deal of urban prairie, and like a good student of Jane Jacobs, I posited this would mean fewer eyes on the street and thus danger. But something very strange has happened in a city shrinking as fast as Detroit: there are so few people in these districts that emptiness doesn’t mean danger. In that regard, it really is a lot like the countryside. Not to mention the clear lines of sight created by having empty lots in every direction.

When Michel told me what areas of the city to avoid, he explained that the parts generally regarded as most dangerous were those that formed a belt around the city. The far western parts of the city near Evergreen; the northern parts around 7 Mile and Dexter; and the eastern parts around Mack Avenue and Gratiot. Even a quick YouTube search on Detroit hip-hop will present one with rappers citing these neighborhoods as particularly infamous and dangerous to reckon with. One song is titled the “Linwood Dexter Way”; another simply “I’m from Seven Mile”; and there’s even a group called the “Gratiot Boyz.” But Woodbridge isn’t one of those areas a rapper would feel legitimate citing as perilous. A Buddhist temple and art galleries have felt comfortable entering the area, so I don’t imagine crime is at the kind of level where it becomes a daily concern in a resident’s life. The idea that what I’d dare call the least desirable neighborhoods (with a few exceptions, like the choice Palmer Woods areas) are in immediate proximity of the suburbs was certainly counter-intuitive to me. Cities very often disobey the notion of gradients one might expect to find.

My tour of Woodbridge concluded in Midtown, and as it was getting late, I stopped at Slow’s “To Go,” a branch of the famous barbeque joint whose ability to lure suburbanites to Corktown went as far as to attract the Times’ attention. I savored their delectable veggie chicken as I waited for the 16-Dexter bus on Cass Avenue. Of all the streets I saw in Detroit, I think Cass Avenue might have the greatest potential to be reborn as a vibrant urban thoroughfare. Its downtown portion offers sights of incredible architecture, like the dilapidated Hotel Eddystone. Up a little north, it passes by some quirky shops and a loft development on Canfield. Then you’ve got the university, the Detroit Institute of Arts (D.I.A.), and the Museum of Contemporary Art just a short walk away in Midtown, and the New Center at the end of Cass. I imagine other urban planners have had the same idea, since the Techtown incubator is located near the northern end of Cass. Combine all this with the street’s relatively small width, making it friendly to pedestrians, and pretty frequent transit service on the 16 line, and you’ve got a killer boulevard.

My last day in the D Michel gave me a tour of his favorite Detroit spots in his car, starting on Belle Isle and traveling through the Villages near the Manoogian Mansion. But he concluded his tour on Heidelberg Street, which remains my most prominent memory of this short adventure. For those unfamiliar with the Heidelberg Project, it’s the brainchild of an artist named Tyree Guyton, who came back to the neighborhood he grew up in after serving in the army during the Vietnam War only to find his neighborhood ravaged by the riots and ensuing neglect. And thus he unwittingly became one of the grandfathers of tactical urbanism, picking up a jar of paint and drawing polka dots on an abandoned house. Before long, he had transformed an entire street of abandoned houses into a tremendous art exhibit, and not one easily understood. The pieces range from the surreal to the deeply political, with human-sized fake syringes sticking out of the grass in one section, and stuffed animals overflowing from a house in another. Some of the project was destroyed by Coleman Young in the name of urban planning, but thankfully it still survives today, constantly changing with the whims of Tyree and the other artists who’ve collaborated on the Heidelberg Project.

To me, Heidelberg Street represents a deeply political reclamation of urban space, a willingness to take the built environment and make it represent the true feelings of a neighborhood, rather than paint over suffering in the name of improving the city. In the end, Heidelberg Street has achieved its artist’s goal of getting people to come into a neighborhood they once feared (and perhaps still fear), simply because it’s too original to miss. If it does contribute to the blight, which it may, its honesty makes it worth it.

I spent my last few hours in Detroit wandering up and down Woodward Avenue, taking in the much-celebrated Diego Rivera mural at the D.I.A. and visiting the old Fisher Theater in the New Center. I even stopped by a crêperie called “Good Girls Go to Paris” on Woodward Avenue, just for the sake of completing my French in Action fantasy.

At the end of the trip, I realized I wanted to write a piece about my experiences in the Motor City, capitalizing on the fact that I was there for a short enough time to have a feel for my visceral reactions—the emotions that would accompany a longer stay don’t cloud my vision. In my urban studies classes, I’ve found we as students have a tendency to confound the questions of how we do change a city in such-and-such way with how we should change a city.

They’re very different questions, and I think that at the end of the day planners should be concerned with how we do accomplish the feat rather than what feat we’re aiming for—that’s a decision for the citizenship. Thus I tried my very best to use my immediate feelings about Motown to guide my urban theory. If at the end of the day, Detroiters think the creative class is a plus for the city, simply because they expand the tax base, then that’s a decision they’ll have to weigh against gentrification. As a budding urbanist, my goal is to understand where each of these decisions may lead.

Alan Sage is an undergraduate at Yale University. He edits the Urban Collective blog for Yale’s urban studies organization.

Sunday, April 22nd, 2012

What Exactly Does an Infrastructure Bank Do For Us Anyway?

Infrastructure banks are back in the news thanks to Chicago Mayor Rahm Emanuel’s plan for his billion plus dollar Chicago Infrastructure Trust. This trust would leverage private funds to finance infrastructure improvements in his city. I’m not taking a position on whether or not it is a good idea or a bad one. Partially that’s because I can’t figure out exactly what it is or what its actual value delivered is. This has nothing to do with Rahm’s proposal per se. I was equally confused back when President Obama proposed his National Infrastructure Bank.

The concept, as I understand it, is that an infrastructure bank is some type of investment fund. It collects money from private and in some cases (e.g. Obama’s proposal) public sources. These funds are then invested via some criteria into infrastructure projects that generate some type of financial return such that the original investment can be repaid over time.

So far so good I guess. The question I have though is what does this actually do for us that we can’t already do? Let’s examine some potential sources of value and what infrastructure banks might deliver on them:

1. They might raise funds in a debt constrained environment. In the Chicago proposal, we hear that the city is staggering under a huge debt load such that it can’t borrow any more money without negatively affecting its credit rating. Ok. So explain me this, if private investors put money into a project and expect to be paid back by some revenue stream over time, how is that not debt? This strikes me as very similar to some privatization transactions, which should be basically seen as a type of off balance sheet borrowing. For example, in the case of the Chicago parking meter lease, the city really just borrowed $1.1 billion from Morgan Stanley and is paying it back to them over 75 years in the form of quarters.

I’m not saying these types of financing activities are all bad. But we’ve seen enough of what happens when companies load up with special purpose vehicles and off balance sheet transactions to know that it dramatically reduces transparency. This will make it difficult to assess just how much debt the city has taken on. If the ratings agencies haven’t caught on to this, you can believe they will at some point if more cities shift to these types of financing structures.

Unfortunately, infrastructure banks are often presented as if they are “free money” to the public. I believe this greatly misrepresents the reality. Any money invested by the bank has to be paid back. An infrastructure bank seems to be just another fancy name for borrowing money. We should probably evaluate it just like we do debt.

2. They might be a vehicle for pools of private funds to be invested in infrastructure. There are two items here: private funds and pooling. We already have many ways in which private funds can be invested in infrastructure. The first is called the bond market, which is a well established mechanism. The second is through more traditional public-private partnerships such as privatization transactions, development projects, etc. It’s hard to see how an infrastructure bank uniquely contributes here. There are already ample means for private funds to be channeled to infrastructure.

An infrastructure bank also pools funds from various investors, which has value. But so to bank banks. And so do various purely private infrastructure funds of the type that already invest in toll roads, water systems, etc. It’s hard for me to see any unique value infrastructure banks bring here.

3. They might limit public risk. Potentially the repayment of the investors could be ring fenced to only the revenue streams of the project. For example, any tolls collected on a new toll road. This would be unlike general obligation bonds, which are backed by all the taxpayers of the city.

There’s clearly value here, but there are also other traditional vehicles like revenue bonds that accomplish the same purpose. Revenue bonds may not be the easiest mechanism however, since they typically require a separate contracting entity like a utility or special purpose authority, and investors want to know that there are stable revenue streams to repay them, like sewer fees.

An infrastructure bank might be good where some of these are not available. For example, the project Chicago has highlighted as an example of where to use its infrastructure bank is to retrofit buildings to make them more energy efficient. There may not be an easy way to use revenue bonds for this. Also, the exact energy savings might not be predictable.

In these cases, the investment might look more like equity than debt, since the ability to get repaid is uncertain. I’ve often seen privatizing contracts in this light. They include a hedge against future risk. For example, when Indiana privatized the toll road, they hedged their risk against traffic declines, which in fact happened during the Great Recession.

Of course, to get someone to take on your risk, you are going to have to compensate them. Thus the rates on this type of financing should be higher.

This raises two fundamental risks. The first is whether or not the city overpays a private entity to take on that project risk. The second is that the city might write a terrible contract such that it really doesn’t outsource much risk at all.

I used to crow about how privatization transferred risk to investors. After reading some of these contracts and seeing how they operate in practice, I’m much more skeptical. In practice, most of these contracts ensure that the public retains almost all of the risk associated with the deal. For example, pretty much the only risk the parking meter lessee took on in Chicago was whether or not people continued to put quarters in the slot. Anything else – like hosting a NATO summit that requires meter closures – is the city’s responsibility.

As I noted in my piece “The Privatization Industrial Complex,” cities are pretty much at the mercy of sophisticated investors who do transactions like this day in and day out for a living. Even in a sophisticated financial town like Chicago, multiple contracts have blown up in the city’s face. The idea that somehow governments will do a better job of negotiating deals with an infrastructure bank than they’ve done with other private investors seems dubious.

However, if you can develop a good framework for this, it does show what I think is one clear advantage of an infrastructure bank construct: it sets up a replicable structure through which these types of investments can be made such that you don’t have to make it up from scratch every time.

4. They might promote rational prioritization of investments. This was something Obama touted for his infrastructure bank. The idea is to somehow depoliticize investment decisions and channel money to the highest priority projects. I would agree this might be a valuable thing at the federal level. And we’ve seen some examples of how it can work, such as the BRAC process for military base closures. But Republicans clearly saw the risk that this would become in effect a slush fund for the President to use to reward supporters. The TIGER process I thought showed that there could be a pretty fair allocation of transport funds on a discretionary basis however, though clearly its decisions favored the President’s view of transport priorities.

In any case, given the lack of a clear and easy to understand rationale for why, if these projects will generate funds to repay the initial investment, any government involvement is need to lure in private funds, it’s easy to see why this wasn’t going anywhere, particularly when there is a fundamental disagreement on the vision for transport infrastructure in America (e.g., high speed rail) and on infrastructure spending and the federal role in it generally.

At the local level this seems less valuable. For example, Rahm can already pretty much channel investment anywhere he wants. If we wants a rational allocation of funding to high priority projects, there’s nothing stopping him from soliciting input on what those projects are from various advisors, then making it happen.

5. They might circumvent costly public contracting rules. Privatizing advocates sometimes suggest that for items with large capital expenditures such as highway or airports, private companies can implement these much more cost effectively because they aren’t subject to burdensome public contracting rules. Unlike public officials, who have an incentive to award contracts to their pals, these private companies have an incentive to make money, so they don’t need the legal framework around public procurement.

From an infrastructure bank perspective, I’m not sure how this would work. Is this just a financing activity that otherwise channels money through the normal bidding process? Or is it an entire separate contracting structure. Given that in Chicago the mayor has promised to abide by minority set-aside requirements and such, it seems like the latter.

It’s hard to see how this would be anything new compared to traditional privatization. Also, the public is likely to want many of its key policy goals such as supplier diversity or open records to be followed in any case. And for major construction, I think people are delusional if they think non-union labor is going to be used.

Again, I’m not saying an infrastructure bank is bad, but I’ve yet to see any clear and compelling explanation of the value proposition. It strikes me as just yet another alternative borrowing structure. I’m happy to be shown wrong on this. But if I’m confused, it’s easy to see why lots of other people are too and why there is so much skepticism around the concept. Feedback welcome.

Thursday, April 19th, 2012

Providence: The Quiet Revival by Alon Levy

[ Here is the second in the two part guest author series on Providence. Alon Levy of Pedestrian Observations brings his typical keen insight to the city - Aaron. ]

Rustwire’s recent article about Providence, and a less recent article on the Urbanophile, have made me think about Providence’s growth. The Urbanophile comes strongly on the side of the power of its coziness; Rustwire takes the opposite track, talking about redevelopment and about the problems of the current recession, which has hit Rhode Island particularly hard.

With the caveat that I’m familiar mainly with the East Side, let me say that the redevelopment is unimpressive. Providence doesn’t look like it’s booming (in reality, its metro area income growth is high), and the city itself is very poor. That said, it doesn’t look very poor – not just on the East Side, which is solidly upper middle-class, but also near downtown. Downcity has a lot of urban renewal hell, but it doesn’t look especially bad.

To me the contrast is with New Haven, a city I’ve visited many times over the last few years, and there’s simply no competition. Although New Haven’s Chapel Street is busier and livelier during than anything I’ve seen in Providence, away from it the city looks post-apocalyptic (and even then, Thayer Street generally stays open later than Chapel). Yale student housing is in glorified project towers surrounded by too much parking, and a never-completed freeway stub and elevated parking structures cut off the main campus from the medical center. Providence has its share of freeways slicing neighborhoods apart, but the East Side managed to avoid them, and its housing stock is normal buildings, developed by different individuals over hundreds of years. Perhaps this better urban integration is why despite being poorer than New Haven, Providence maintains lower crime rates, echoing Jane Jacobs’ points about safety.

In other words, Providence is starting from a much better base than peer cities, though, going purely by income, nearly all secondary Northeastern cities are growing fast. The issue is not that Providence is rebranding itself as the Renaissance City, or Creative Capital. It’s that it was messed up less than other cities. Worcester has almost nothing next to the train station. New Haven has housing projects that I know people who are afraid to walk through. Providence has sterile condos and a mall, but next to them are some nice secondary shopping streets, and beyond them, in the right directions, lies intact urbanism, on the East Side and in Federal Hill.

If anything, most relevant government policy even in recent decades has hurt city walkability. In the 1980s, the city moved the railroad tracks north of the river, severing them from the East Side Railroad Tunnel. Simultaneously, it built Providence Place Mall and today’s train station, covering what used to be elevated track. The project was meant to remove an eyesore from downtown, but instead just moved the station to a more inconvenient location, and the mall sucked retail out of Downcity streets. Even what Rustwire calls highway removal was really a realignment: the I-195 river crossing was moved to a more southerly location since the old route was not up to the latest design standards, and this also happened to move the freeway farther away from Downcity and reunite it with the previously-isolated Jewelry District. There’s nothing wrong with that realignment, but it’s the kind of project Robert Moses would’ve supported.

On top of this, the attitude toward economic development is just embarrassing. Last year, I went to a meeting featuring smartphone app writers who claimed that “Providence is like a startup,” without a shred of irony about using this word to refer to a 17th-century city. A representative from the city government talked about the subsidies the city is paying to young entrepreneurs to just come live here.

And still the revival continues. Rhode Island may have one of the highest unemployment rates in the US today, but income growth is high; things are slowly getting better. The most visible growth in the US is in population rather than income, and so the usual markers are new housing starts, new infrastructure, and a lot of “coming soon” signs. Providence of course doesn’t have much of this. Instead, people are getting richer, slowly. RISD students occasionally go down the hill to Downcity (though Brown students don’t, since Brown’s campus is much higher uphill).

Economic growth in the richest countries is slow enough that people don’t perceive it. Instead, they think it’s the domain of countries that are catching up, such as China, where it’s so fast it includes new construction and the other markers that signify population growth in the first world. In the long run, it matters that a city’s income grows 1.8% a year rather than 1.1%, but it’s not visible enough to be captured by trend articles until long after the spurt of growth has started.

This article originally appeared in Pedestrian Observations on March 7, 2012.

Wednesday, April 18th, 2012

Real Scene: Berlin

I linked a couple weeks ago to a series of video shorts on Detroit. One of them was a documentary about the city’s techno heritage. The same producer created videos of other techno scenes as well, including the one below of Berlin.

It’s an interesting overview of a slice of Berlin’s famous creative scene, but I wanted to highlight a couple points about it. First, per the video, the thing that originally drew creatives to then West Berlin was a West German law that residents of West Berlin were exempt from compulsory military service. Second, a key catalyst for the explosion of the techno scene was the collapse of the Berlin Wall. This led to a mass exodus from East Berlin that left many abandoned structures with no clear legalities around their ownership or use. The curious and creative Western draft avoiders then went to explore these and ended up creating the techno scene.

I think this is interesting in assessing policies to lure the creative class and what you need to do to support a creative scene. There was no policy to attract creative people to the city. They came on their own to exploit a loophole in a law wholly unrelated to creativity. Once there, they took advantage of cheap, available spaces with few restrictions on what to do, catalyzed by a massive social upheaval.

This suggests the genesis Berlin’s creative environment was an accident that can’t be replicated by others. The one item that seems amenable to copying is cheap spaces with few restrictions. Indeed, this is sort of what we see playing out in Detroit at present. It’s hard for cities perhaps to produce the spaces in the first place, but they can make a choice to keep their hands off when people start experimenting. Detroit did this unintentionally through government incompetence and severe resource constraints. Whether other more capable city governments can resist the urge to intervene is a question yet to be answered. For more thoughts on this, see Detroit as Urban Laboratory and the New American Frontier.

Here’s the video: If it doesn’t display for you, click here.

Tuesday, April 17th, 2012

Yet Another Privatization Debacle in Chicago

I have been and remain a staunch defender of privatization done right, but done poorly it can be a disaster. It looks like we are seeing yet another example of this unfold in Chicago.

You are probably familiar with the now infamous Chicago parking meter lease. But prior to that the city had similarly leased parking garages downtown east of Michigan Ave. This transaction hadn’t done anything to raise concerns with me so far. I’m not sure why most city governments would be in the parking garage business in the first place. Put ‘em up on eBay I say.

But as it turned out, the city, in order to goose its returns, had promised the vendor who leased the garages a monopoly on parking. Lots of privatization contracts have no-compete clauses in them that prevent the government from operating a competitive facility for the duration of the lease. I’m not sure that’s good public policy, but it’s not a slam dunk decision either way. But the Chicago garage lease goes far beyond that and promised that the city would not allow anyone to build a garage that was open to the public in the area where the leased garages are. Wow! In effect, the city rezoned the area by contract without telling anybody. (A legit rezoning would have required notifying property owners, etc. as well as getting aldermanic signoff) It looks like the previous administration once again sold off the right to set public policy to a third party – this time for 99 years.

Naturally this has come back to haunt the city. Morgan Stanley, which controls both the meters and the garages, has filed a $200 million arbitration claim against the city. They claim that the city allowed the developer of the Aqua skyscraper to open a parking garage to the public in a restricted area, and this has harmed the value of their lease. If true, this looks like a very straightforward breach of contract.

This new claim comes on top of a $13.5 million claim over the parking meters related to allowances for handicapped parking. That’s a particularly dangerous claim because it could be recurring and if annualized and adjusted for inflation would mean that Chicago would end up owing over one billion dollars over the lifetime of that contract!

Rahm must be going crazy over these deals he inherited. This is what happens when you sign deals that don’t get subjected to proper public scrutiny. The timing is also less than ideal for Rahm as he tries to get his infrastructure bank proposal approved by a skeptical city council.

The Chicago experience should definitely cause other cities to think hard about privatization. Privatization should be about competition, not contractually enforced monopolies. It should not unduly restrict the ability to change public policy to meet future needs. The term should be strictly limited (50, 75, or 99 years is ridiculous). Deals featuring large up front payments should be avoided where possible, and subjected to strict controls on spending the windfall if not. And the contractual terms need a thorough vetting.

More on Privatization
Parking Meters and the Perils of Privatization
Can Chicago Get Out of Its Parking Meter Lease?

Principles of Privatization:
Part 1: Taxonomy of Transactions
Part 2: Value Levers
Part 3: Use of Funds
Part 4: Guidelines for Action

Sunday, April 15th, 2012

Nashville Rolls On

I have a friend in Nashville and try to get there about once a year for a visit. He knows my insatiable desire for urban exploration, so tries to take me around to new places each time, which is awesome. A couple of my previous trips were documented in the posts “Impressions of Nashville” (from 2007) and “Nashville: Next Boomtown of the New South” (from 2008). As with previous visits, I want to highlight a few observations I had.

The first is, “What Great Recession?” Yes, Nashville surely suffered from this, and there’s a notable absence of private sector construction visible that testifies to that, especially in marked contrast to my first visit in 2007. Yet what you feel in Nashville is a sense of vitality and a sense of optimism. This is a place that hasn’t lost faith in its destiny.

I think that can’t be overstated in a city. It feels good to have the wind at your back. It feels good to be in a place where the people believe they are headed towards better days and towards a better future. Just like bandwagon sports fans, people want to sign up to be with the winning team and while the future can’t be predicted, Nashville looks like a winner and its people believe they are winners. I can feel the difference in the air versus say even the best performing Midwest metros like Columbus or Indianapolis.

Nashville was the 12th fastest growth large metro in America in the 2000s, growing at 21.2% and adding 278,000 people during the course of the decade. Last year, like most regions, growth slowed, but remained healthy at 1.4%. During America’s “lost decade” of job creation, Nashville added 36,000 jobs. Nashville’s job growth last year ranked 5th among large cities at 2.4% or 17,400 new jobs. The sense of optimism is fully backed up by the numbers. Lots of places would kill to be performing like this.

Beyond simple internal growth, Nashville is an attractor city. People from outside want to move there and I’ve met many people originally from someplace else. While this is changing or diluting the culture – southern accents are in decline in various precincts, for example – in ways some might not like, as I’ve noted before, having a critical mass of outsiders is very important to urban success.

The driver of this seems to be the music industry. I’ve gotten in the habit of asking people why they moved to Nashville. Music is by far the most common answer. (In fairness, perhaps this is something that’s de rigueur to say, and people don’t want to admit to having moved for more prosaic reasons). That industry is clearly key to the city. Not only is it economically important in its own right, but it draws media attention and even draws celebrities (not all of them country stars) to live there. Music is like a lot of other industries. It’s easier than ever to get into the game and I suspect most cities have a vastly better music scene than they did a decade or two ago, yet the peaks of the industry are also higher than ever, and Nashville is one of the peakiest of all.

The other thing music drives is tourism. Nashville is a big (but thankfully not too big) tourist draw. Again, this creates brand awareness and drives economic growth, but also exposes people to the city. I’d say that increases the likelihood of attracting people. My point of view on Nashville before visiting it would have been to assume it was a sort of hillbilly heaven, but I learned it was more cosmopolitan by visiting it. It’s a city I could actually live in. Drawing visitors gives Nashville the opportunity to tell its story and make a pitch for the place.

Nashville also is implementing some very forward looking urbanist policies. I noted before their form based code, high quality basic urbanism of the new development in the central city, and legitimate infill densification. They continue to up their game here, with a major rezoning that effectively eliminates traditional zoning in the downtown apart from banning heavy industrial use, and eliminates minimum parking requirements. That’s huge and we’ll see what dividends it pays over time.

Everything isn’t perfect in Nashville. My friend worries that if he ever lost his job, there would be few corporate opportunities available to someone with this skill profile. Nashville doesn’t yet have the large and diverse employer set of major cities, making planting your flag there somewhat risky outside of industries like music and health care. Assuming the city continues its growth, this will be addressed over time. But it’s something that should inform the city’s recruitment efforts. The city is very focused on trying to lure corporate HQ relocations. But trying to lure an HQ where there’s little overlap with the existing industry base might not be the best idea.

Also, Nashville suffers from a notable lack of quality in some areas. I previously mentioned their second class infrastructure standards. This place too often suffers from a southern “bare bones” feel, even in new development. Also, the architecture is extremely conservative. This seems not to have harmed their growth and perhaps really isn’t that important in the short term, no matter how much I might want it to be. Where I believe it makes a difference is over time as things age. If things are super-cheaply done and notablw mostly for being new and to contemporary style, they may lose their appeal over time and end up as struggling redevelopment zones 20-30 years down the road as so many other places have.

But that’s a problem for another day. For now Nashville continues to rock and roll, as it were.

Thursday, April 12th, 2012

US Metro Population Growth Slows

Last week the Census Bureau released 2011 county and metro area population estimates that showed overall slowing population growth and particularly showing slow to halting growth in exurban counties. I’ll come back to the exurbs in a minute, but first a look at a map of metro area growth last year:

Metro area percent change in population, July 1, 2010 to July 1, 2011. Source: Census Estimates via Telestrian

Here’s the county map:

County percent change in population, July 1, 2010 to July 1, 2011. Source: Census Estimates via Telestrian

Someone once said to me about Chicago’s Mayor Daley that if he did something you liked, he was a visionary genius leader, but if he did something you hated, he was a corrupt machine dictator.

That seems to be how too many urbanists view the Census Bureau.

Back in the 90s when the Census estimates showed cities growing more slowly than boosters believed, they pressured the Census Bureau into adjusting the estimates to provide higher values. As it turned out, in most cases even the original estimates for cities proved inflated. In fact, the 90s were actually better for a lot of major cities than the 2000s were (e.g, New York, Los Angeles, and Chicago). This led to a new narrative that the Census had undercounted cities somehow.

Now this new data shows slowing exurban growth. All of a sudden, the Census Bureau has become once more a source of Gospel Truth, and I’ve seen many articles suggesting that the exurbs are dead, killed by rising gas prices and new Millennial preferences.

Let’s not get ahead of ourselves here.

Yes, exurban growth slowed recently. While cities on the whole fared more poorly than expected in the last census, we did see strong growth in downtowns and adjacent areas. I myself wrote about improving migration trends for core cities. That’s good news worth celebrating for cities. But don’t overstate the case.

I have a different though admittedly speculative take on the exurbs. I think a chunk of the fringe migration was from very low end home builders skipping out beyond established jurisdictions into unincorporated territory with few buildings restrictions. They threw up dirt cheap homes there and often sold them to people with marginal credit and income who had no business buying homes, using a variety of gimmicks to do so. (I know someone who sold homes for one of these builders, so I heard about some of these). Loose credit policies and government guarantees fueled this. The housing crash killed this market. Now that subsidies for this type of growth aren’t available, so that market is probably never coming back.

But when the economy improves and the market normalizes, I’d expect some level of suburbanization to resume. Part of the logic is simple math. If you add up the population of the municipalities of New York City, Los Angeles, Chicago, Philadelphia, San Francisco, Boston, Seattle, Washington, Portland, and Miami you only get 20 million people. That’s only about 20% of what the Census Bureau is projecting for just population growth by 2050. With the difficulties of building in urban areas, there’s no way to accommodate just the new growth even if everybody wanted into the city. In other words, there’s just no way there is going to be some massive back to the city movement. I hate to break it to you, but that’s reality.

Here’s the full list of large metros, sorted by population growth percentage:

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Aaron M. Renn is an opinion-leading urban analyst, consultant, speaker, and writer on a mission to help America’s cities thrive and find sustainable success in the 21st century.

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