NLC Focuses on Early Primary States for 2016 Presidential Elections Task Force

This is a guest post by Emma Lieberth.

Senator Bernie Sanders speaks to the crowd at the Iowa State Fair. The former mayor of Burlington, Vt., Sanders is one of four former mayors running for president.

Senator Bernie Sanders speaks to the crowd at the Iowa State Fair. The former mayor of Burlington, Vt., is one of four former mayors running for president.

The author, with (clockwise, from top left) 2016 presidential candidates Rick Santorum, George Pataki, Hillary Clinton and Ben Carson at the Iowa State Fair.

The author, with (clockwise, from top left) 2016 presidential candidates Rick Santorum, George Pataki, Hillary Clinton and Ben Carson at the Iowa State Fair.

The Iowa State Fair has become a rite of passage for candidates on both sides of the political isle vying for the highest office in the land. Presidential stump speeches on the fairgrounds are as popular of an attraction as the food on a stick and famous butter cow. Over the course of three hot and humid days, I took part in the festivities on behalf of the members of the National League of Cities (NLC). On the road to 2016 and beyond, we’re determined to make sure the concerns of local officials and the communities they serve are addressed by the candidates.

“Local officials in Iowa have more access to Presidential candidates than any other state in the country,” said Alan Kemp, Executive Director of the Iowa League of Cities. “The issues that NLC fights for are not partisan issues. These are important issues that matter to local governments across the country. It’s important for the 2016 candidates to hear from us.”

Several candidates took turns speaking at the Des Moines Register Soapbox while others just stopped by to visit with caucus-goers. The candidates largely spoke about their plans for healthcare, views on Planned Parenthood, immigration and threats to national security; and while these are critical issues that need to be addressed, I didn’t hear much about what their plans are here at home surrounding economic development, the country’s infrastructure and ways to improve public safety. In the recent 2015 State of the Cities Report released by NLC, economic development was the most commonly addressed topic in mayoral speeches followed by infrastructure and public safety.

Iowa State Fair attendees cast their votes with corn kernels.

Iowa State Fair attendees cast their votes with corn kernels.

As we get into the race for President, NLC is dedicated to being the voice for city leaders and bringing the conversation around local issues to the forefront of the 2016 race and reminding the next administration about the issues local officials face daily.

In March 2015, NLC President Ralph Becker, mayor, Salt Lake City, Utah, named a bipartisan group of 17 city officials and state municipal league executive directors to serve on the NLC 2016 Presidential Election Task Force. The goal of the task force is to raise the visibility of city issues during the presidential election cycle, the task force will develop an actionable plan that includes tools and resources for NLC members to engage candidates on city issues.

Representing the National League of Cities at the Iowa State Fair.

Representing the National League of Cities at the Iowa State Fair.

Next month, we will be releasing our platform on issues critical to local governments. NLC wants to be a resource for the every campaign on issues surrounding local governments and will be reminding the candidates of their importance. We encourage local officials around the country to join us – let’s speak up and let our voices be heard.

About the Author: Emma Lieberth is the Program Manager for Strategic Partnerships at the National League of Cities. Follow her on Twitter @emmalieberth.

Affirmative Action at UT Austin: Why Cities Should Take Note

The Supreme Court has decided relatively few affirmative action decisions, such as this case involving the University of Texas at Austin (pictured above) – so all are of interest to state and local governments that use race as a factor in decision-making. (Gregg Mack/Getty Images)

If you were going to bet on the outcome of a Supreme Court case — much less the Court’s reasoning — you should avoid the Fisher case. It’s anyone’s best guess.

For the second time the Supreme Court has agreed to decide whether the University of Texas at Austin’s race-conscious admissions policy is unconstitutional in Fisher v. University of Texas at Austin.

Per Texas’s Top Ten Percent Plan, the top ten percent of Texas high school graduates are automatically admitted to UT Austin, which fills about 80 percent of the class. Unless an applicant has an “exceptionally high Academic Index,” he or she will be evaluated through a holistic review where race is one of a number of factors.

UT Austin denied Abigail Fisher, a white Texan who did not graduate in the top ten percent of her class, admission. She sued, claiming Austin’s use of race in admissions violates the Fourteenth Amendment’s Equal Protection Clause. She argued that using race in admissions is unnecessary because, in the year she applied, 21.5 percent of UT Austin admissions were minority students.

The Supreme Court has held that the use of race in college admissions is constitutional if race is used to further the compelling government interest of diversity and is narrowly tailored. In Fisher I the Court held that the Fifth Circuit, which upheld UT Austin’s admissions policy, should not defer to UT Austin’s argument that its use of race is narrowly tailored.

When the Fifth Circuit looked once again at UT Austin’s affirmative action plan, it concluded that it is narrowly tailored. The Top Ten Percent Plan works well at increasing minority student enrollment because Texas schools are so segregated. But a number of well-qualified students are excluded — specifically, minority students who performed well at majority-white schools but weren’t in the top ten percent of their class. If race wasn’t considered during holistic review, almost every student admitted would be white because of the test score gap between white and minority students. And as a result of holistic review, a much higher percent of white students are admitted — but generally between 25-30 percent of the overall number of black and Hispanic students are admitted through holistic review.

A dissenting judge questioned much of the majority opinion, fundamentally arguing that while UT Austin claimed it is trying to achieve a “critical mass” of diverse students, its definition of “critical mass” is unknown, immeasurable, and unclear. So it is impossible to know whether UT Austin’s use of race is narrowly tailored to meet this goal. While the dissent said that “critical mass” isn’t a number, it questioned whether the number of black and Hispanic students admitted through holistic review — 216 out of 6,322 — is large enough to contribute to UT Austin’s critical mass objective. The dissent also questioned the merits of assuming that minority students admitted via the Top Ten Percent Plan are “somehow more homogenous, less dynamic and more undesirably stereotypical than those admitted under holistic review.”

Why did the Court take this case yet again (especially considering Abigail Fisher graduated from another university years ago, Justice Kagan will recuse herself again, etc.), and what will it say? The possibilities are endless, but cities should monitor this case nonetheless. Lyle Denniston discusses a few possible outcomes on SCOTUSblog.

Lisa Soronen bio photoAbout the Author: Lisa Soronen is the Executive Director of the State and Local Legal Center and a regular contributor to CitiesSpeak.

5 Ways Cities Are Making Their Communities More Walkable

People in communities across the country are increasingly stepping out to let city leaders know that walkable communities are important to them. And not just in big cities or college towns. It’s happening in small- and medium-sized cities, too.

Walkability Infographic

According to the U.S. Department of Transportation, the number of walking trips has increased more than twofold, from 18 billion annual trips in 1990 to 42.5 billion in 2009. (Daily Infographic)

Simply put, if destinations are close by, people will walk to them. Results from recent national surveys show that people want to live in walkable neighborhoods, e.g., those that include sidewalks and have amenities such as restaurants, shops and parks within walking distance.

The Urban Land Institute found that 50 percent of people consider walkability a high or top priority when choosing a place to live. In a survey done by the National Association of Realtors and the Transportation Research Center at Portland State University, 79 percent of respondents indicated that being within walking distance of amenities such as parks and shops was an important factor in the decision of where to buy a home, and 85 percent indicated sidewalks were also important. Furthermore, this survey found that although all generations like to walk, Millennials (people ages 18-34) prefer walking over driving by 12 percent, the largest margin than any other generation.

Businesses are responding to this demand. A new study of approximately 500 different sized companies found that more businesses are moving to walkable downtown locations in small and large cities in an effort to attract and retain employees, because they know that their current and potential employees value neighborhoods within close proximity to restaurants, arts and culture and public transportation.

Cities are responding to this demand as well by developing policies and designing neighborhoods with walkability in mind. Here are a five approaches being used in cities across the country.

  • Walking Audits
    A walking audit can be used to assess the physical environment of an area to improve the infrastructure for pedestrian safety. Walking audits can enhance certain areas within a neighborhood or corridor, a path from home to school or to one’s place of employment. These audits are a powerful tool that can be used to engage community members in conversations about what they see in their neighborhoods. Often the findings from an audit are used for improvements in safety and access, and are incorporated into a city’s pedestrian master plan or a city’s general plan. AARP has a useful Sidewalks and Survey Audit Tool.
  • Complete Streets
    Complete Streets” are designed for safe access for all users regardless of their ability, age or how they travel from point A to point B, including those who travel by foot or wheelchair. Complete Streets often include sidewalks, frequent and safe places to cross streets or intersections, accessible pedestrian ramps and signals, multi-modal bridges and other elements to ensure pedestrians are protected when they travel. Complete Streets approaches will look different in rural locations versus urban areas. Over 700 regional and local agencies have adopted Complete Street policies, and each year Smart Growth America highlights what they consider to be the best policies.
  • Revitalization Projects
    Local parks can be popular draws for residents and visitors alike. Cities have been revitalizing parks to serve as destinations in and of themselves, to function as places to connect different parts of neighborhoods, and improve distressed neighborhoods. Park revitalization models are popping up that are intentional about ensuring that neighborhood parks are walkable and incorporate social equity into their design.

    IMG_1152

    Chicago’s Daley Bicentennial Plaza was recently transformed into Maggie Daley Park, which provides an opportunity for children, families and adults to walk and explore a park downtown. (Tracy Wiedt)

  •  Healthy Corridors
    Many cities are making enhancements to commercial strips, such as improving safety for pedestrians through sidewalk and intersection improvements. The Rose Center for Public Leadership, a partnership between NLC and the Urban Land Institute, is working with four cities to redevelop their corridors to positively impact the health of residents and their communities. These projects are also focusing on enhancing connectivity to surrounding neighborhoods, many of which are inhabited by low-income families and people of color.
  • Health in All Policies
    Residents who live in walkable communities often have better health outcomes. To effectively incorporate health elements into policy decisions, cities are turning to a “Health in All Policies” approach to address walkability and pedestrian safety. Health in All Policies is a concerted approach used by decision-makers from various sectors to ensure public policy either positively impacts health or does not negatively impact health.

This week, during lunch, after work or over the weekend, take a walk downtown! See what your city has to offer, whether it’s a new restaurant or a park you haven’t visited before – explore downtown.

About the Author: Tracy Wiedt is the program director for Health & Wellness at the NLC Institute for Youth, Education, and Families. Contact Tracy at wiedt@nlc.org.  


Financial Inclusion Takes Center Stage in Nashville

This is a guest post by Erik Cole.

This is the fourth post in our financial inclusion blog series. This post highlights Nashville’s Financial Empowerment Center and the impact that their programs and services are having on the community.

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Nashville Mayor Karl Dean with clients at the Nashville Financial Empowerment Center. (photo: Erika Chambers ©2015 United Way of Metropolitan Nashville)

In 2013, Nashville Mayor Karl F. Dean partnered with the United Way of Metropolitan Nashville to create the Nashville Financial Empowerment Center (FEC), which consists of two main centers and six satellite sites across Davidson County. The Center was established to strategically address the needs of the 17 percent of Nashville’s population who live below the poverty line.

Based on New York City’s model, Nashville’s Financial Empowerment Center offers free one-on-one financial counseling to residents. Counseling services are integrated into existing social service agencies and public locations such as Nashville’s public libraries. Counselors are professionally trained and provide their clients with assistance in:

  • Budgeting and building savings
  • Reducing debt
  • Opening safe and affordable bank accounts
  • Establishing and improving credit

Mayor Dean quoteThe Financial Empowerment Center is a key piece of Nashville’s economic and community development portfolio. This portfolio also includes Bank On Music City, which connects unbanked individuals and families to bank accounts and quality financial education programs; the Nashville Alliance for Financial Independence; and the United Way’s Volunteer Income Tax Assistance program, which provides free tax return assistance to low- and moderate-income people.

Making Financial Inclusion a Reality
In order to make the idea of the Financial Empowerment Center a reality, Mayor Dean’s office and the United Way of Metropolitan Nashville pursued funding from Bloomberg Philanthropies’ Cities for Financial Empowerment (CFE) Fund. In January 2013, the CFE Fund selected Nashville, along with four other cities, to receive a $16.2 million, three-year investment. The other cities chosen include Denver, Philadelphia, San Antonio and Lansing, Mich.

Since opening in March 2013, Nashville FEC staff have helped over 3,200 people and held more than 10,000 individual counseling sessions. The FECs have helped residents reduce their collective debt by over $1.9 million and increase their savings by over $500,000.Rosa Moore quote

With the help of her FEC coach, Rosa has continued to attack her debt, paying off several accounts in full. She also pursued consumer protection claims against a creditor as part of a national settlement. She has further built an emergency savings account to protect her in the future.

Nashville has seen success integrating financial counseling into a multi-cultural community center, the Casa Azafrán Community Center. By co-locating with existing nonprofits at the center, this FEC site is able to offer wrap-around financial support services to individuals in need and help move them toward self-sufficiency. This center has effectively created an environment in which residents have a one-stop-shop for all their social service needs.

The FEC’s partnership with Habitat for Humanity promotes financial education and counseling with the ultimate goal of helping families in need to secure and maintain a home. This partnership with Habitat has resulted in four families becoming homeowners to date, and several more are currently working towards homeownership. These families began this journey with large amounts of debt and very low credit scores.

Looking to the future, Mayor Dean and the United Way of Metropolitan Nashville plan to integrate other partners into the FEC model. They are working with local partners to integrate financial counseling into youth employment and workforce development efforts as well as public housing and support services for homeless families.

This November, Nashville will host NLC’s annual Congress of Cities conference. Don’t miss our workshop on financial inclusion, which will feature an in-depth look at the innovative programs that cities, including Nashville, are implementing to address their residents’ financial challenges. The workshop will also highlight the results from our recent report, Local Financial Inclusion Efforts: A National Overview.

Erik Cole
About the Author:
Erik Cole was named Nashville’s first Director of Financial Empowerment in February 2013. The Nashville Financial Empowerment Center is a public/private partnership based in the Mayor’s office. He is also a former two-term Metro City councilmember.

NLCU Summit: Q&A with the University of Central Florida’s Roy Reid

This is a guest post by Brian Egan.

Roy Reid serves as Executive Director of Communications at the University of Central Florida, pictured above. (photo: Mathew Hasegawa)

NLC is excited to announce the addition of Roy Reid, Executive Director of Communications at the University of Central Florida, to our lineup for the 2015 National League of Cities University (NLCU) Annual Leadership Summit in Orlando, Fla.

Roy is an expert in communications, public relations, and trust building. In addition to working with the nation’s second largest university, Reid has provided his expertise to global corporations such as Walt Disney World Resorts, Walmart and CSX. This September, Reid will lead a session on Building a High-Trust and Resilient Culture. In anticipation of our Annual Leadership Summit, NLCU sat down with Roy to ask him a few questions.

NLCU: What makes you passionate about this topic?

Roy: I have worked in the communications, public relations, public affairs and marketing space for more than 25 years. In that time, I have spent a majority of the time helping leaders deal with issues and crises. With a front row seat to some of the most challenging issues, I find that those who have a more intentional and engaging effort in earning, cultivating, and restoring trust are more likely to thrive in good times and bad. I find that this effort will cultivate a culture that prioritizes people, strengthen relationships and improve results.

NLCU: What does a high trust and resilient culture look like?

Roy: Outputs and outcomes are at or better than expected. People are engaged in their work and not just present. Issues are addressed head on with no fear and a commitment to the mission. Efficiencies and effective processes are improved on regularly. Risk is mitigated because people have an assurance that others are operating with a high degree of ethics. Employees are fiercely loyal and retention of great employees is high.

NLCU: From your experience, talk about a success story involving a leader building and maintaining a high trust and resilient culture.

Roy:  I will provide two. I live in Orlando, Florida, and have a great working relationship with our Mayor Buddy Dyer.  Since taking office in 2000, Mayor Dyer has always been about cultivating relationships and earning trust with the people around him. Perhaps the best example of his commitment to trust and relationships can be seen in three major initiatives over the past ten years: Lake Nona, SunRail, and the Downtown development. In each of these efforts, the mayor had to take a stand on issues and lead others to understand the importance to take risks in achieving greater results for our community. Throughout those three efforts he took responsibility for the relationships and worked to ensure that people understood the need, risk and benefits. Today, Lake Nona stands as an example of collaboration with private and public sector leadership and is delivering on its promise of economic development and improvements to quality of life in Central Florida. SunRail just completed its first year of operation and is the first leg of transit options that will grow into a network of rail options to move people throughout the region. Downtown Orlando is evolving into a place that people desire to live, work, and play with world class facilities and venues. There is much work to do in each of these areas and the mayor stays on the point of helping ensure that the right people and resources are in place.  In addition, the culture of City Hall reflects this idea and the culture there fosters a strong expectation of trust and results.

The other person I would cite is Ken Bradley, the CEO of Florida Hospital Winter Park and former Mayor of The City of Winter Park. I worked with Ken for a number of years at Florida Hospital and can attest to his commitment to first build trust and cultivate relationships in the effort to achieve great things. In 1999, we were part of the team that led the effort for Florida Hospital to acquire Winter Park Memorial Hospital. Throughout the process, our plans were framed up by the idea that we had to bring people together first (many of whom may have been at odds on other matters) to develop collaborations that would facilitate a smooth transition and ultimately deliver a high performing hospital. The hospital today is a shining example of how a healthcare provider works in conjunction with the community to deliver care. In addition, Ken served three terms as Mayor in Winter Park, taking the city through some of the most controversial and important transitions over the past decade.

NLCU: Why should elected officials be passionate about this topic?

Roy:  With all the distractions, political matters and interest groups, elected leaders must have clarity in how they will earn, build, cultivate, repair and restore trust so they can serve the communities effectively. Today’s marketplace and landscape are more convoluted and people are far more demanding of greater engagement and transparency from leaders — especially public officials. Research is clear that there is far greater skepticism and doubt in the minds of the public regarding public officials and government.

NLCU: What skills will local elected officials gain from your session?

Roy:  They will better understand how trust works. They will learn how trust can be measured in their culture. They will understand four guiding principles for how they should engage others each day. Finally, they will understand the four attributes that people look for in people they trust and understand how to strengthen them.

NLCU: Thank you, Roy. We look forward to hearing more about building a high trust and resilient culture when you speak on September 17 at the Annual Leadership Summit in Orlando.

***Click here to learn more about the NLC’s Annual Leadership Summit and register***

About the Author: Brian Egan is an intern from American University at NLCU, the National League of Cities University.

NLC Hosts 2015 State Municipal League Summer Meetings

This is a guest post by Emma Lieberth.

Downtown Detroit.

Hart Plaza in downtown Detroit.

Downtown Philadelphia.

Downtown Philadelphia.

Every year, the National League of Cities organizes two annual conferences for the 49 state municipal leagues. This year, the State Municipal League Staff Workshop was held in Philadelphia, Penn., from July 15-17 and the State Municipal League Executive Directors Workshop was held in Detroit, August 4-7.

Staff from 34 state municipal leagues attended the 2015 gathering in Philadelphia hearing from speakers on a range of sessions including trends in social media, state legislative issues, member engagement, conference planning, non-dues revenue and leadership.

State League staff share best practices at the State League Staff Workshop in Philadelphia.

State League staff share best practices at the State League Staff Workshop in Philadelphia.

Executive directors and deputy directors from 41 state municipal leagues came together in Detroit for the 2015 State League Directors Workshop. League directors had the opportunity to discuss leadership and management strategies, state league legislative and legal advocacy, non-dues revenue, new federalism and to share best practices. Attendees also took a mobile tour of Detroit to see the challenges and renaissance the city is currently experiencing.

Downtown Detroit.

Downtown Detroit.

“These two meetings are a way for staff of the state municipal leagues and league directors to get together annually and compare notes on issues impacting local governments and officials,” said Scott Hancock, Chair of the 2015 State League Steering Committee and Executive Director of the Maryland Municipal League. “These meetings provide an invaluable networking opportunity and help us be better organizations for our members. The state municipal leagues founded the National League of Cities and these two meetings further strengthen our relationship.”

Next year’s State Municipal League Staff Workshop will be July 15-17 in Kansas City, Mo., and the 2015 State Municipal League Executive Directors meeting will be August 2-5 in Phoenix.

About the Author: Emma Lieberth is the Program Manager for Strategic Partnerships at the National League of Cities. Follow her on Twitter @emmalieberth.

How to Build a New Type of Urban Practice: Analyzing NLC’s Economic Indicators Report

This is a guest post by Ben Hecht. This post is the first installment in a series focused on NLC’s 2015 Cities and Unequal Recovery report, which highlights the findings of our 2015 Local Economic Conditions survey.

If we want to see dramatically better results, we need new ways of solving the complex problems facing American cities. The findings from NLC’s 2015 Local Economic Conditions survey highlight three opportunity areas where we can focus our attention to catalyze lasting change.

(photo: Bill Dickinson)

Many findings in the 2015 Local Economic Conditions report, recently published by the National League of Cities (NLC), mirrored what we at Living Cities are seeing in the field. We believe that the following three areas, highlighted in the report and below, are particularly important to understand and harness if we are going to build a new type of urban practice that gets dramatically better results for low-income people in cities:

Entrepreneurs, Small Business, and the Rise of ‘Urban Serving Businesses’

The NLC’s finding that “new business startups and business expansions are driving improved economic health in cities” couldn’t be more true. And it’s different than in other recoveries. For example, in our Integration Initiative sites in Albuquerque, N.M. and New Orleans, civic leaders are intentionally tapping into the potential of local entrepreneurs of color and unique contracting opportunities to build growth businesses and to get low-income people and people of color into jobs, especially at a sustainable, living wage. Encouragingly, the Kauffman Foundation recently selected Albuquerque as part of a new project to learn about and identify the best ways to build a local ecosystem to support these emerging entrepreneurs.

Relatedly, we’re seeing the rise of what we’ve termed ‘Urban Serving Businesses,’ structured as social enterprises and otherwise, that are building their businesses in cities, creating jobs and often delivering products and services that are improving the lives of low income people and the communities in which they live. Accelerators like Tumml and participants in efforts like Code for America and Venture for America are great examples of this trend. This is an area of opportunity for cities, and one that Living Cities and our partners are exploring on the job creation front. We’re about to undertake a landscape scan, in partnership with Deutsche Bank, to understand the state of that emerging sector, the ecosystems that currently exists to support them, and the gaps that inhibit their growth and long term success. We’re also interested in learning if a collaborative like Living Cities can play a role in that ecosystem, and what that role could look like.

Addressing the “Skills Gap” Problem from Cradle to Career

Yet, even as businesses grow, we’re still seeing that educational attainment and workforce preparation remain a challenge. As the NLC study found, the misalignment between skills available in the community and the needs of businesses is worsening. This reality is part of why we are a big supporter of the StriveTogether Network, where we’re learning about and testing promising solutions to fixing the skills gap permanently by re-engineering the systems that are failing our kids, from cradle to career. We’re particularly encouraged by the recent announcement of the six sites selected for funding from Strive’s Cradle-to-Career Accelerator Fund. In each site, leaders from the public, private, philanthropic and nonprofit sectors have come together to achieve needle-moving change across the cradle to career continuum, from readiness for Kindergarten to college completion and securing of a good job. They are using data for continuous improvement, disaggregating by race and income, and working to re-direct dollars from approaches that aren’t getting results to those that do. More than two dozen other sites are primed to learn from them and follow in their footsteps.

Innovative Affordable Housing Solutions: Looking the Problem with Fresh Eyes

Finally, the NLC’s study confirms what we are reading about in the papers and on social media every day. Despite “rising residential property values,” the “lack of affordable housing is a major concern facing cities.” We’re seeing communities across the country realize that the tried-and-tested tools that they’ve long relied on to attack the problem are grossly insufficient to address current conditions. That has catalyzed places like San Francisco and Boston to develop new approaches to building market-rate, mixed income, and affordable housing for their residents. In Boston, for example, the Mayor’s Innovation Team (i-team) is tackling the city’s affordable housing challenge in new and creative ways by helping agency leaders and staff through a data-driven process to assess problems, generate responsive new interventions, develop partnerships and deliver measurable results.

NLC’s new report highlights exactly the areas where we need to focus our attention. It provides further fuel for the argument that we need new ways of solving many of these old problems if we want to get dramatically better results. There are many promising solutions out there — in Albuquerque, Boston, Cincinnati and beyond. We all need to help them to succeed and to move them from the periphery of practice to the mainstream.

About the Author: Ben Hecht  was appointed President & CEO of Living Cities in July 2007. Since that time, the organization has adopted a broad, integrative agenda that harnesses the collective knowledge of its 22 member foundations and financial institutions to benefit low income people and the cities where they live. You can reach Ben on Twitter @BenHecht.

 

New Evidence That the Tax Exemption Matters

Tax-exempt municipal bonds provide support for infrastructure projects such as the Leonard P. Zakim Bunker Hill Bridge in Boston, pictured above. (photo: Will Damon)

Walking down Commonwealth Avenue in Boston this summer, it was hard to imagine more than six feet of snow in this very place not more than a few months prior. Although the snow has melted (finally), a wake of potholes is a daily reminder to residents, businesses and government of the critical need for sound infrastructure.

Most infrastructure projects, including roads, schools and sewer systems, are paid for by tax-exempt municipal bonds. This places municipal bonds squarely at the center of inquiry between increasing infrastructure needs and decreasing public investment.

A new white paper released this month by ICMA and GFOA, Municipal Bonds and Infrastructure Development – Past, Present and Future, helps to untangle the relationship between bond market conditions and infrastructure investment. Demographics and politics appear to play a larger role in capital spending levels than do interest rates, the study finds, but of critical importance is the tax-exempt nature of municipal bonds.

The post-recession slowdown in local and state infrastructure investment would have been significantly worse had the tax-exemption not been in place. “If the federal tax exemption for municipal bonds were repealed, state and local governments would have paid $714 billion in additional interest expenses from 2000 to 2014,” notes author Justin Marlowe, University of Washington. “For a typical bond issue this would mean $80-210 in additional interest expenses per $1,000 of borrowed money.”

Other key findings from the new report include:

  • In 2014, state and local governments invested nearly $400 billion in capital projects, a significant slowdown in spending. Total state and local capital spending has not yet returned to pre-Great Recession totals.
  • Approximately 90 percent of state and local capital spending is financed by debt.
  • There are more than one million municipal bonds in the market today, issued by more than 50,000 units of government, and their total par value is just over $3.6 trillion.

Financing methods, such as pay-as-you-go and public-private partnerships, are explored as alternatives to tax-exempt municipal bonds. Although effective for some types of capital projects, these methods should be viewed as complements to tax-exempt financing, not robust alternatives, notes the report. For example, “[PAYGO] can take decades to save up the requisite capital, and on a present value basis, debt becomes cheaper at some point in the intermediate to long-term future.”

With limited alternatives, the instability of a federal funding stream and a recession hangover that continues to stifle political inclination toward financial risk, the importance of the tax-exempt municipal bonds cannot be understated.

About the Author:christy-mcfarlandChristiana K. McFarland is NLC’s Research Director. Follow Christy on Twitter at @ckmcfarland.

Economic Recovery, Pop-Ups and Sports Stadiums: This Month in Economic Development

Our monthly roundup of the latest news in economic development filtered through a city-focused lens. Reading something interesting? Share it with @robbins617.

Cities and Unequal Economic Recovery. How are local economies faring now that the worst of the recession is behind us? NLC recently surveyed mayors across the country to find out. In Cities and Unequal Recovery, NLC’s Christiana McFarland and Emily Robbins examine local economic indicators in cities and reveal that economic recovery is following two distinct paths – economic conditions are improving for some, but worsening for others. The report serves as a resource for cities on implementing inclusive growth strategies around affordable housing, workforce development, and wages in order to encourage equity in local economies. Check out the report’s coverage in the Wall Street Journal.

LEC Infographic 2015-03

Mayors are Talking, and We’re Listening: State of the Cities 2015. Economic development, infrastructure, and public safety are the top three issues on the minds of mayors this year, according to the second annual analysis of mayors’ state of the city speeches conducted by NLC’s Brooks Rainwater, Christiana McFarland, and Micah Farver. Among the speeches analyzed for State of the Cities 2015, 75 percent discussed new or ongoing economic development strategies. Take a peek into the minds of mayors in the report, and also check out the Fast Company op-ed and the Washington Post article.

Examining the Pop-Up Phenomenon. Pop-up programs, such as temporary retail markets and short-term occupancy of vacant office space, are a relatively new recruitment technique for economic development. This interesting article from The Guardian explores how pop-ups are popping up across the country, and examines whether or not these temporary solutions could lead to permanent benefits within our cities.

Are Local Businesses Vanishing? Speaking of vacant storefronts, this Governing piece highlights how gentrification in New York City is displacing local mom and pop businesses at a higher rate than ever. In particular, businesses are seeing their rents double or triple in price because of high-demand. A local blogger made the striking observation that, “Small businesses aren’t just struggling – they are being targeted for assassination.” NLC recently covered this issue in a blog post, along with some strategies cities are using to address commercial vacancies.

How the “Dark Store” Method is Hurting Commercial Property Tax Collection. The Institute for Local Self Reliance recently shared an eye-opening report on how big box companies can potentially manipulate property tax assessments in their favor, while putting local government budgets in jeopardy.

Ideas of the Month: The Old Takoma Business Association in Maryland recently launched a tailored loan program for small businesses funded by local investors from the community. Also, in Baltimore, a very generous restaurant made reservations during Restaurant Week only for those who can’t afford to pay.

What We’re Reading. The City Initiatives for Technology, Innovation and Entrepreneurship (CITIE) report from Nesta, Accenture, and Future Cities Catapult. (This is really a must-read.)

John Oliver, host of HBO's "Last Week Tonight."

John Oliver, host of HBO’s “Last Week Tonight.”

For a Laugh. HBO’s John Oliver from Last Week Tonight made some really interesting arguments for why local governments shouldn’t financially support the construction of privately-owned sports stadiums. Get ready to get outraged. (Note, some of the language is NSFW.)

Thing to Know: The Internet of Things. Get used to hearing this phrase. The Kauffman Foundation offers up an explanation for why it matters.

Links to previous editions of This Month in Economic Development are here, here, here, here, and here.

Robbins_small (2)About the author: Emily Robbins is the Senior Associate of Finance and Economic Development at NLC. Follow Emily on Twitter: @robbins617.

 

A Smarter Way to Make Smart Cities

This is a guest post by Isabel Munson.

Songdo, South Korea has been billed as the world’s first “smart city.” (Image: Gale International)

Today, when we hear the term “smart city”, massive interventions powered by some of the world’s largest companies come to mind.

Take the $35 billion+ city of Songdo, South Korea, which was built from the ground-up with the help of Cisco. The planned city boasts 16 miles of bike paths, 40 percent of its area dedicated to outdoor spaces, and a designation as the biggest project outside the U.S. to be included in the LEED Neighborhood Development Pilot Plan (and first LEED Accredited district in South Korea). Most impressive of all is the city’s pneumatic waste disposal system, which funnels garbage from every kitchen in the city directly to a central waste processing center. Only seven employees handle waste for the whole city, and there are no garbage trucks or cans on the street.

But how can you make a smart city if you don’t have several billion dollars or the ability to build a development from the ground up? Aren’t expensive projects by big companies the only way to make your city smart?

Though it may seem counterintuitive, small interventions powered by small companies can have almost as large of an impact with a fraction of the price. The creation of small smart cities companies may seem unrelated to any municipality’s actions, but cities can do a lot to encourage and empower these innovations.

For example, the mayor’s office of New Urban Mechanics in Boston focuses on incorporating futuristic design and technology into the city’s development. Its willingness to invest resources and take chances on new technology has helped small companies succeed while ensuring that Boston remains innovative. I work for one of those small companies, Soofa, a MIT Media Lab spinoff founded in 2014. With the support of New Urban Mechanics, Soofa was able to pilot 10 pieces of smart urban furniture — solar-powered charging benches — just a few months after creating the first prototype.

Soofa CEO Sandra Richter with Boston Mayor Marty Walsh and the first Soofa protoype. (Mashable)

Soofa CEO Sandra Richter with Boston Mayor Marty Walsh and the first Soofa protoype. (Mashable)

The feedback gained from this pilot phase allowed Soofa to make major bench improvements and complete their first production run this spring, with benches being installed in seven U.S. states.

The new Soofa Bench, with changes made based on results of the Boston pilot program. (Soofa)

The new Soofa Bench, with changes made based on results of the Boston pilot program. (Soofa)

Across the river, Cambridge was also willing to take a risk on a new startup by being an early adopter of Soofa Benches and a R&D partner. The Soofa Bench features a sensor brain that detects the environment around it — from noise and nitrogen levels to humidity and temperature. Cambridge realized that this wealth of data gained from urban environments can be harnessed for more effective city planning, evaluating the efficacy of various programs and developments, and most importantly, helping citizens enjoy their urban spaces! As such, Cambridge was willing to be Soofa’s R&D partner as they develop the most comprehensive sensor brain and data platform possible.

So, why are small interventions better? When entrepreneurs envision ways to improve the city, they dream big, but are constrained by cost and practicality. The resulting products have big potential with a much smaller price tag. Installing a bench is much easier than retrofitting aged infrastructure with sensors, and more cost effective. A solar-powered bench can seem like an unnecessary expenditure, especially to smaller cities, but this investment enables cities to be more efficient and enjoyable in the future.

Creating a space where local entrepreneurs can have their city-improving ideas heard and potentially supported by city governments is critical to the creation of smart cities. Even if no investments are made, gaining the input of stakeholders from professors to designers and engineers is invaluable to future city planning. Chicago’s Array of Things project is another great example of a city using their valuable local academic and technological resources to create a low-cost, high-impact smart cities intervention.

A rendering of the Chicago Array of Things sensor boxes’ functionality. (Chicago Array of Things project)

A rendering of the Chicago Array of Things sensor boxes’ functionality. (Chicago Array of Things project)

Chicago still took input from smart-cities giants like Cisco, but made a conscious choice to loop in local talent for the research and design behind the project. Though here we encourage cities to support small companies creating smart cities interventions, we must give big companies credit where credit is due. Without their push to encourage smart cities projects, smaller companies would never be able to sell their products or get funding — because no one would know what a smart city is! The research, awareness and funding from major companies in the smart cities space has been invaluable. That said, any city can be cost-effectively made into a smart city through small interventions powered by small businesses.

So, how do you future-proof your city? Prioritize the creation of civic innovation offices similar to New Urban Mechanics to support local talent and small businesses. Small, agile interventions end up having a big impact.

About the Author: Isabel Munson is the Data Strategy Lead at Soofa, an Internet-of-Things company dedicated to creating social, sustainable and smart cities. Her other musings on smart cities, #Soofatalk, may be found at www.soofa.co or @mysoofa.