Using Data to Improve Accountability in Economic Development Programs

This post was written by Ellen Harpel, founder of Smart Incentives and president of Business Development Advisors LLC (BDA), an economic development and market intelligence consulting firm. Post originally appeared on the Smart Incentives blog.

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Data is one of the key elements of the Smart Incentives 4×4 framework that enables communities to make sound investment decisions. Unfortunately, good data on how well incentive programs work is often lacking. This lack of data hinders both economic development professionals in their day-to-day work and policymakers in their leadership and oversight roles.

Last year one report concluded unhappily, “We simply don’t have the information we need to make good decisions about incentives.” The Pew Charitable Trust’s widely-cited 2012 report, Evidence Counts, found that “half the state have not taken basic steps” to provide evidence of whether incentives work well or not, and “no state regularly and rigorously tests whether those investments are working,” though many states have taken valuable steps to begin to understand and evaluate the impact of their incentive programs.

Here we consider 3 data themes: available resources, challenges in data collection, and organizational advice to improve data management.

1. We have better data than ever on existing state incentive programs and past deals thanks to the Council for Community and Economic Research (C2ER) State Business Incentives Database and Subsidy Tracker 2.0 from Good Jobs First. These resources provide a great start for understanding the incentives environment. Further, many states are striving to improve the quality of reporting on their incentive use, providing new insights into existing programs.

2. We know we still need to improve data collection to assess compliance and outcomes associated with incentive deals, but we first must overcome substantial challenges. These include but certainly aren’t limited to:

  • Applying consistent definitions to the various measure of merit, including how we count jobs (all, new, over a baseline, full-time (by number of hours worked?), part-time), wages and investment
  • Accessing data sources to obtain and validate these measures by project
  • Determining project timing for compliance versus evaluation purposes
  • Tallying the exact cost of each incentive, both on a project and a program basis. This is particularly challenging for many tax–based incentives taken as needed over a multi-year period. Further, should costs be calculated by project? by annual budget impact? by program?
  • Deciding who should collect the data and how the data management effort should be staffed and funded

3. Enabling economic development organizations to address these data challenges requires significant effort, including the following critical steps:

  • Assembling a team with analytical skills as well as subject matter expertise. The team should encompass economic development knowledge, experience working with businesses, political awareness, analytical skills and information system expertise. You’ll probably have to look beyond your own agency to pull together the talent you need.
  • Asking the right questions to guide data improvements by defining the current situation, describing an improved state, focusing on the most important issues that need to be addressed, and agreeing on a desired outcome.
  • Collaborating with other agencies to collect data and share analytics expertise. Development finance entities, tax and revenue departments, and workforce or labor departments are all potential allies for data collection, analysis and verification of incentive use and compliance.
  • Setting expectations at senior levels for analysis and accountability in incentive programs. Staff must know that their efforts to track compliance and performance are important to the economic development mission and the organization’s leaders.

Smart Incentives works every day to provide state and local governments the data and analytics they need to identify what works and to enable sound decisions when awarding incentives. Founder Ellen Harpel is also pleased to be part of the Center for Regional Economic Competitiveness team working with the Pew Charitable Trusts on the Business Incentives Initiative, designed to improve data collection, management and reporting within state incentive programs.

HarpelAbout the Author: Ellen Harpel is President of Business Development Advisors (BDA) and Founder of Smart Incentives. She has over 17 years of experience in the economic development field, working with leaders at the local, state and national levels to increase business investment and job growth in their communities. Contact Ellen at eharpel@businessdevelopmentadvisors.com or ellen@smartincentives.org. Follow Ellen on Twitter @SmartIncentives.

Supporting Small Businesses through Economic Development Offices

This is a guest post written by Jason Rittenberg.

Bakery Square in Pittsburgh is a mixed-use redevelopment project of CDFA member Urban Redevelopment Authority.

Bakery Square in Pittsburgh is a mixed-use redevelopment project of CDFA member Urban Redevelopment Authority.

Incubators. Microlending. Accelerators. Crowdfunding. From rural areas to large cities, from the middle of the country to the coasts, today’s economic development entities — and their jargon — are all-in on encouraging small business finance.

Communities are increasing their support with good reason. Small businesses account for more than 99 percent of firms, 49 percent of employment and 42 percent of payroll in the country.[1] Further, small business lending continues to struggle out of the recession. While overall business lending is up nearly 25 percent from 2008, bank loans of less than $1 million remain down 14 percent over the same period.[2]

So communities are focused on helping small businesses, and from a constituent and need perspective, it makes sense for them to do so. But what does it mean to “help” a small business? For that matter, what is a “small” business? The answers to these questions are actually complex.

The U.S. Small Business Administration (SBA) defines a small business as having fewer than 500 employees, covering 99.7 percent of all firms. However, 90 percent of firms have fewer than 20 employees, and 62 percent have fewer than five. The difference in sophistication, goals and needs of a business with no employees is vastly different from a business with 10 employees, which is again exponentially different from a firm with 200 employees. Infusionsoft put together an infographic in 2012 to help illustrate these differences.

Given this variation, communities looking to support small businesses of any stripe need to think strategically about their economic development goals and needs before proceeding. Development finance programs require non-trivial commitments of resources to be effective and should therefore be entered into only as part of a comprehensive regional strategy. At the organization I work for, the Council of Development Finance Agencies (CDFA), we refer to this approach as the “development finance toolbox.”[3]

In the area of small business access to capital, CDFA has seen a wide variety of city and state programs be successful. Technical assistance, seed and venture capital, credit enhancement, and lending programs — as well as incubators, microlending and other trendy solutions — can all contribute to small businesses in different ways. The keys to success are to match the right program to real community needs and to find the right partners to assist in implementation.

Small business needs, foundational finance programs, and innovative support programs are all being covered as part of the Providing Small Businesses with Access to Capital forum being held in Kansas City, MO on October 8-9, 2014. Economic development, small business development, and other city staff are encouraged to participate in the event to learn about the latest and best practices for encouraging this critical sector of the local economy.

Rittenberg_HeadShot_blogAbout the author: Jason Rittenberg is the Director of Research & Advisory Services for CDFA. He oversees numerous projects, including the State Small Business Credit Initiative Coalition, and is the course advisor the CDFA Intro Revolving Loan Fund Course.

 

 

 

[1] U.S. Census Bureau. (2012). Latest Statistics of U.S. Businesses Annual Data. Retrieved 8/19/2014 from: http://www.census.gov/econ/susb/

[2] Simon, P. and Loten, A. (2014, Aug. 17). Small-business lending is slow to recover. Wall Street Journal. Retrieved 8/19/2014 from: http://online.wsj.com/articles/small-business-lending-is-slow-to-recover-1408329562

[3] Rittner, T. (2009). Practitioner’s Guide to Economic Development Finance.

Business Incentive Initiative

This post was written by Ellen Harpel, founder of Smart Incentives and president of Business Development Advisors LLC (BDA), an economic development and market intelligence consulting firm. Post originally appeared on Smart Incentives blog.

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Local businesses in New York City’s West Village. Source: Flickr user wallyg

City leaders have many concerns about the cost and effectiveness of economic development incentives in their communities, as we learned from the session on economic development financing tools during last year’s Congress of Cities. A new initiative working to develop best practices for evaluating incentives at the state level will help local elected officials whose communities use state incentive programs for business attraction. It should also provide some guidance for cities striving to assess their own local incentive programs.

The Pew Charitable Trusts recently announced the launch of the Business Incentives Initiative. This Initiative will help improve data collection, management and reporting within state incentive programs in order to “improve decision-makers’ ability to craft policies that deliver the strongest results at the lowest possible cost.”

Pew and the Center for Regional Economic Competitiveness will engage leaders from seven states (IN, LA, MD, MI, TN, OK, VA) to develop best practices for evaluating economic development incentives by:

  • Identifying effective ways to manage and assess economic development incentive policies and practices.
  • Improving data collection and reporting on incentive investments.
  • Developing national standards and best practices that states can use to successfully gather and report data on economic development incentives.

As project manager Jeff Chapman explained in an interview with Bloomberg BNA:

This initiative builds on Pew’s ongoing project to help state policymakers implement ongoing evaluation of economic development incentives. As states work to measure the effectiveness of these programs, they often find they lack the data needed to determine whether an incentive is producing the expected outcome. Further, there is currently no source that has identified and compiled the best practices on how to overcome this obstacle.

All states were invited to submit proposals to participate, and seven were selected. They have agreed to commit top decision-makers from economic development, revenue, and other relevant state agencies to work intensively with Pew throughout this 18-month program. Each of these seven states has also already begun to address the challenges associated with economic development incentive program management and evaluation. The Pew team will work with the states to develop and implement tailored solutions for each state, while also paving the way for development of best practices and training that will be available to all states.

I am pleased to be part of the Center for Regional Economic Competitiveness team working with Pew on this important effort. Our role will be to leverage our economic development and incentives expertise to provide technical assistance to the states.

Here at Smart Incentives, we have emphasized the importance of data, analysis, transparency and accountability in economic development incentive use. The lack of quality data regarding compliance and effectiveness is a significant problem for the economic development field and policymakers trying to do what’s best for their communities. The Business Incentives Initiative represents a notable step forward in enabling smart incentive use in all states.

HarpelEllen Harpel is President of Business Development Advisors (BDA) and Founder of Smart Incentives. She has over 17 years of experience in the economic development field, working with leaders at the local, state and national levels to increase business investment and job growth in their communities. 

Contact: eharpel@businessdevelopmentadvisors.com or ellen@smartincentives.org. Follow Ellen on Twitter @SmartIncentives.

What It Takes to Cluster

This is a guest post written by Daria Siegel, Director of Launch LM and Andrew Breslau, Downtown Alliance Senior Vice President of Communications and Marketing.

Tech Tuesday’s took place at the South Street Seaport during the summer of 2013.  Hundreds of technologists gathered for conversations related to innovation and technology at this weekly public event series.

At Tech Tuesday’s during the summer of 2013, hundreds of technologists gathered for conversations related to innovation and technology at this weekly public event series.

It seems everybody these days wants a “tech cluster.” Municipalities across the country are repositioning themselves as tech friendly in hopes of capturing some of the promise the industry might hold for their local economy.

Here’s the rub though: a tech cluster can’t happen just anywhere. It needs two primary ingredients. One harkens back to that oldest of business clichés “location, location, location” and the other is a bit more under a municipality’s control: a coordinated strategic marketing campaign.

The beginnings of a meaningful tech cluster are rooted in the strength and breadth of a location’s irreducible assets. Even in the face of the digital economy’s decentralizing potential, agglomeration is essential. One of these desired clusters can’t be faked, plunked down just anywhere or retrofitted neatly in the postindustrial landscape (unless you have access to an extraordinary amount of capital i.e. Las Vegas). A preexisting creative cluster or digitally dependent core industry, robust academic assets, cutting edge telecommunications resources, access to financial resources for start-up and mature businesses alike and multi- modal transportation networks are just some of the characteristics that enable viable tech clusters.

If those assets constitute the hardware needed to animate a tech cluster, the software is marketing. In order to build the right marketing software, a location has to first be ruthlessly honest in its appraisal of what its “hard” assets are. Whatever your store of hard assets is, it will take a partnership amongst a consortium of stakeholders and investments in branding, social media and organizing to make the most of your locality’s strategic and competitive interests.

In Lower Manhattan, we’ve been doing just that.  In September of 2013 we created LaunchLM, an initiative to galvanize and grow the technology and digital communities in Lower Manhattan. Over the past year, the number of tech companies in Lower Manhattan grew by 24 percent, from nearly 500 to 600 companies today.  And that doesn’t even count digitally oriented media and other creative industries. We believe the potential to build on that is vast.

Lower Manhattan has a legacy rooted in innovation. From AT&T building its first headquarters here in 1916 to being the location of the first transatlantic telephone call, Lower Manhattan has always teemed with possibility. We’re blessed with unsurpassed transportation access, a rich pool of knowledge workers, space for businesses to let at a variety of price points, the nation’s most advanced fiber optic network and we possess an already bustling mixed use environment.

By partnering with the real estate industry, LaunchLM provides venues for programming and events targeted toward the creative industries sector, like the holiday party hosted by LaunchLM and Control Group at 4 World Trade Center.

LaunchLM provides venues for programming and events targeted toward the creative industries sector, like the holiday party hosted with Control Group at 4 World Trade Center.

LaunchLM grew out of a committee convened by the Alliance for Downtown New York—New York’s’ larges Business Improvement District. The committee, made up of stakeholders in the tech sector, real estate professionals, industry associations, community leaders, venture capitalists and entrepreneurs, met for a year discussing and debating the kinds of catalysts needed to help Lower Manhattan reach its potential with the industry.

Two bedrock principles of the effort were clear and became the pillars of LaunchLM. The effort had to make those it was seeking to influence the parties who defined our direction and also make them partners in content making.  The effort needed to be by and for the technologists, executives and locational decision makers and influencers that make or break clustering. It also had to be an effort that was committed to for the long haul. Whatever work was undertaken would have to be sustained with constant investment and effort over time. Years, not weeks. To quote the Carpenters “we’ve only just begun.”

Launch likes to think of itself as relentlessly active and patient at the same time.

Whether it’s our restless pursuit of building virtual community through our rich website, Twitter, Instagram and Facebook accounts, the attention we pay to SEO and email list building or the regular public programming we sponsor from Start-up Open houses to talks on the frontier of data science to discussions on the intersection of food and tech, we keep our ear to the ground about the industry’s latest trends and concerns and then invite them to partner with us to produce relevant content. We never forget it’s their industry, we help produce the venue, the crowd, make connections and spread the word.

This is the key to marketing to the Tech sector. If it’s ersatz –you’re done. Be what you advertise.

In addition to making content, Launch is an advocate. Among other things, we educate the real estate community about the particular needs of tech clients–flexible space, bike rooms, etc. You can look to our website as a resource for tech friendly buildings in the district. We also energetically engage with government, educational institutions and the not for profit sector on the industry’s needs and agenda. We strive to be a connecter, problem solver and industry champion.

Our next step will be creating a physical space where programming, networking and pedagogy can have a home. In the months ahead, LaunchLM will become a three dimensional destination where industry associations and startups, out of town executives and companies can come set up and shop, conduct business, sponsor hackathons, do product demos and convene audiences. All that and have a killer cup of coffee at the same time. Never forget that caffeine is the fuel that the Tech industry runs on!

Our results so far? Great press about the district’s assets, a constant drum beat about possibility, promise and achievement, a robust and growing social and communications network, a new sense of community, new connections between the real estate and tech industries and a palpable sense of momentum.

We’re confident that it’s the dynamic interplay between the intrinsic appeal of Lower Manhattan and how and with whom we sell it that will ultimately tell the tale of our “cluster.” We’re also confident that, with the course we’re setting, the oldest neighborhood in New York City is going to play a big role in defining the City’s economic future.

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Andrew Breslau is a Senior Vice President for the Alliance for Downtown New York. A former press secretary in New York City government, a not for profit executive and producer at CNN, he manages the Alliance’s communications, marketing and technology teams.

 

 
Daria_headshotDaria Siegel, an urban planner, serves as Director of LaunchLM, an initiative designed to champion the growing technology sector in Lower Manhattan, created by the Alliance for Downtown New York.

Local Governments Expand Incentive Programs for Technology Companies

This is a guest post by Ellen Harpel, president of Business Development Advisors and Founder of Smart Incentives.

Incentives are taxpayer backed programs used to influence business decisions and spur company investment or job creation in specific locations. Incentive use has expanded tremendously over the past several years, though the exact amount of money devoted to incentives is unknown.

We do know that incentives are no longer reserved for special, targeted projects, but are offered to entities of all types and sizes. They include bonds, grants, investments, loans, and tax breaks. They might be used to provide capital, reduce taxes, prepare or purchase a facility or site, build or extend infrastructure, or recruit and train a workforce.

Over the past few weeks several communities in the Greater Washington region have either proposed or implemented changes to their incentives policies in the hopes of attracting more technology companies. Here is a quick rundown of some of their actions:

Arlington, VA: Proposed expanding the definition of eligible businesses that can take advantage of Technology Zone incentives that reduce the Business Professional and Occupational License tax on gross receipts. If implemented, smaller business (<100 workers) and expanding firms (not just new businesses) in a broader set of technology fields will be eligible for a 50% rate reduction ($0.18 instead of $0.36) in all 4 of the County’s Technology Zones.

Digital DC: The District of Columbia has committed $1 million to a venture fund that would provide $25k-$250k grants to early stage tech entrepreneurs locating in a designated corridor in the city. These businesses would also be eligible for funding for building rehabilitation or office construction. Digital DC adds to existing DC Tech Incentives and incubator/accelerator programs supported by the city.

WeWork co-working space in DC’s Shaw neighborhood, part of the city’s newly designated technology corridor. Photo Credit: WeWork

WeWork co-working space in DC’s Shaw neighborhood, part of the city’s newly designated technology corridor. Photo Credit: WeWork

Prince George’s County, MD: Approved creation of a science and technology business district in order to create jobs by providing tax incentives, streamlining permitting and approvals, and fostering collaboration among academia, government and industry. The district in the northwestern portion of the County includes College Park (University of Maryland), Greenbelt (NASA Goddard Space Flight Center) and Beltsville (USDA).

Alexandria, VA: A Business Tax Reform Task Force has as one of its objectives to “identify revenue or other incentives that the City can deploy to attract businesses and encourage beneficial development aligning with the City’s Strategic Plan.”

Incentives have become more important to business investment decisions and the day-to-day work of economic development. We founded Smart Incentives because we believe it is vital for state and local leaders to have access to high-quality business intelligence, data and analytical tools to make the best decisions for their community.

Smart Incentives helps communities make sound decisions throughout the economic development incentives process. We serve cities and economic development organizations by providing in-depth business research on companies seeking incentives and business case analyses for incentive projects. Smart Incentives is also at the forefront of efforts to develop better processes for monitoring compliance and evaluating the effectiveness of incentive programs.

HarpelEllen Harpel is President of Business Development Advisors (BDA) and Founder of Smart Incentives. She has over 17 years of experience in the economic development field, working with leaders at the local, state and national levels to increase business investment and job growth in their communities. 

Contact: eharpel@businessdevelopmentadvisors.com or ellen@smartincentives.org. Follow Ellen on Twitter @SmartIncentives.

WUF7: The Mayors Forum Part II — Individual City Solutions

This is the fifth post in a series of blogs on the World Urban Forum 7 in Medellin, Colombia.

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In my previous blog, I wrote that the focus of the Mayors Forum was on inclusiveness in order to create a “city of opportunity.” However, I would be misleading you if I implied that each mayor was striving to create a “city of opportunity” in the same way. What they shared was an outcome. How they got there very much depended on how developed, how democratic and how wealthy the city is.

This was exemplified by the diversity of approaches for creating a city of opportunity. Some focused on transportation, others on broader infrastructure, others on job creation, others on education, and still others on public spaces, and for most, a combination of different strategies was necessary. But two things did seem to underlie their approaches regardless of the strategy: inclusiveness and money.

The mayor of Barcelona, Spain underscored this when he said, “We can have the noblest ideas, but if we do not have the financial resources to draw upon, there is nothing that we can do to change our cities and create opportunities for our residents.” He called on national and state governments to respect the work that cities do by ensuring that cities have the resources they need to be a city of opportunity. And the mayors of Medellin, Colombia and Asker, Norway reiterated the importance of involving all residents in the decision-making process and not just the rich or advantaged.

In Santiago de Chile, this process enabled the city to move forward with the development of an adequate urban mass transit system. Prior to development of this system, the city and its residents were supporting the 30 percent with cars, while the rest had to make it on their own. Once the city came together to discuss a solution to the problem of moving its residents from home to work and school, they were able to reach agreement that there needs to be a transportation system, including roads and mass transit, that provides 100 percent of the population with access to everything the city offers.

In Nanjing, China, the focus has been on building a metro system that will serve the poorest sections of the city. While not sharing the deliberative process that led to this decision, the mayor did note that if they failed to create a system that benefited the poorest, the city would remain divided and the poorest residents would have no opportunities to access education, jobs and important social services.

And the mayor of Medellin, Colombia, chimed in by underscoring yet again the importance of his city’s metro system to the least advantaged residents of Medellin, and how important it has been to ensuring that they can get to work, to school and to the services they need. “We were able to transform a two-hour or more commute by bus and foot from the most remote sections of the city into a 45-minute commute to the downtown. In this way we were able to give our residents back two and one-half hours of their day, and increase their happiness.”

In Delft, Netherlands and Budapest, Hungary, the opportunities provided by effective transportation networks were already there; what was lacking was the ability for many of the residents to enter the job market because the skills they had were not the ones local businesses wanted. Delft’s strong technology sector, a driver of job creation, was limited in its ability to absorb unskilled workers. To address this, the city entered into agreements with construction companies, service providers and others who hire lower skilled workers, requiring that they first hire local unemployed residents before recruiting from elsewhere.

Budapest, a city with low relatively low unemployment, still faced enormous employment issues. Long term unemployed residents were not being hired, and young people were also not being incorporated into the workforce. In response, the city set up its own public works program for low skilled workers and worked in partnership with local businesses to ensure that long-term unemployed workers were considered for jobs; and if they were not hired, the city would step in with high-skilled opportunities. The same was done for the city’s youth.

For some of the mayors, there could be not hope of creating a city of opportunity unless the city was safe. In Johannesburg, South Africa and Gombo, Congo, the latter having just been torn apart by a civil war where young people were often soldiers, the response could not simply be having more police. Efforts to move the youth away from violence required their complete engagement in each city’s development, so that the young people saw a future for themselves in the city in which they live.

Finally, many of the mayors spoke of the need for accessible and meaningful open spaces, and educational systems that included pre-school and after-school programs.

But all of this came down to one issue for each of these mayors, and that was the creation of a city filled with opportunity, where every resident feels a part of the city, has pride in their city, and benefits from being part of the city. As the mayor of Medellin put it, “We want every resident to be happy; to feel good about where he or she lives, and to benefit from every aspect of life that the city has to offer.” Something every United States mayor wants for their residents as well.

WUF 7 Day One: Are ‘Cities of Opportunity’ Really Possible?

This is the second post in a series of blogs on the World Urban Forum 7 in Medellin, Colombia.

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The theme of the United Nations World Urban Forum 7 in Medellin, Colombia, is “Equity in Development — Cities for Life;” or what I prefer to call “Cities of Opportunity.”

According to the United Nations, it is now estimated that two-thirds of the world’s urban population live in cities where income inequality has been increasing. In many cases, this increase has been staggering. These inequalities can be seen in urban spaces, with cities divided by invisible borders that create social, cultural and economic exclusion.

This conference has been designed to provide city leaders with the tools they need to create cities in which the design, governance and infrastructure of cities has a direct and positive impact on the lives and opportunities of their inhabitants. In other words, this conference is about ensuring that cities of opportunity remain possible, and become a reality.

Over the conference’s seven days there will be lectures, dialogues, discussion groups, training sessions, roundtables and assemblies.

Among these will be:

  • A mayors’ forum in which mayors and their representatives will discuss how urban planning, design, legislation, governance and finances can be strengthened to ensure equitable local development; and share experiences how urban leaders have been able to reduce urban inequalities and move toward equitable development;
  • A United Cities and Local Governments (UCLG) sponsored discussion on how to provide basic services to under-served communities;
  • Training sessions addressing diverse topics such as the use of public space to reduce inequities, food security in low income areas, workforce strategies in urban slums, building safe cities through inclusive participation, sustainable communities, learning to respond to mega-disasters, ensuring resiliency and responding to youth violence;
  • Assemblies designed to address major urban issues including youth, gender equality and business; and
  • Side events such as one on urban innovation and inclusive governance meant to supplement the conference’s agenda.

Among the speakers will be such luminaries as:

  • Richard Florida, professor at the University of Toronto and New York University and senior editor of The Atlantic;
  • Joseph Stiglitz, Nobel Laureate in Economics and professor at Columbia University
  • Judith Rodin, Ph.D., president of the Rockefeller Foundation
  • Richard Sennett, professor at the London School of Economics and New York University;
  • Ricky Burdett, professor of Urban Studies and director of the London School of Economics Urban Age Programme; and
  • Sarah Rosen Wartell, president of the Urban Institute.

What remains to be learned in the ensuing days is how cities of opportunity should be conceptualized and ultimately implemented. Stay tuned.

Partnerships Key to Twin Cities Light Rail

This post was written by Roger Williams and Mark Weinheimer to introduce a new case study from NLC about the partnerships that contributed to the construction of the Central Corridor light rail line in St. Paul and Minneapolis, Minnesota.

St-Paul-light-rail

One of the ways cities have tackled challenges to their resiliency has been to undertake transformational projects. These cities have recognized that staying the same, or doing small things, don’t necessarily bring about transformation. But strategically placed projects involving the key challenges of efficient transportation, economic development, community preservation, and job creation can make a difference.

But, given the scope, size and impact of such projects, cities have had to build partnerships and relationships with a diverse group of stakeholders and residents to get these efforts moving. Quite often, they also have had to work to overcome a legacy of past missteps that have eroded community trust and devastated communities.

Despite concerns that partnerships take time and large projects consume resources, study after study shows that  transportation alternatives that are regionally focused, cost effective, located close to affordable housing, and that get residents to their jobs help make cities more amenable to innovative industries and more resilient.

The relationships that were forged by the Twin Cities of Minneapolis and St. Paul, Minnesota, as they undertook the Central Corridor light rail project connecting their downtowns, is an example of how municipalities are coming together with a wide range of partners to overcome obstacles and make these transformational projects a reality.

Working with the philanthropic community and a broad spectrum of civic organizations that serve the communities impacted by the project, local leaders in the Twin Cities developed a template for planning that other cities can learn from.

Far reaching strategic alliances and the “plan-full” approach that involved diverse groups, along with the leadership roles played by various actors and sectors, are the key elements that have enhanced this project’s chances for success. The leaders were able to successfully create a shared vision for vibrancy, economic viability, and neighborhood resilience.

The result is not only a new light rail line, but an increased number of affordable homes nearby, preservation of other homes, new arts and cultural offerings, and a vital retail sector that reflects the ethnic diversity of the communities along the rail line.

The Central Corridor light rail line which is scheduled to open in mid-2014 will also provide cost effective transportation for the residents to connect them to jobs in both cities and in the region, and in general strengthen the attractiveness of living in these communities.

Investment in Nation’s Infrastructure is Economic Lifeline

President Obama used the backdrop of the historic Union Depot Station in Saint Paul, Minn. to announce another round of federal TIGER grants – the Transportation Investment Generating Economic Recovery – competitive grant program that has provided 270 communities with an opportunity to make strategic multimodal transportation investments since its inception five years ago. The $600 million in TIGER grants and the president’s proposal for a four year transportation authorization program to replace the current MAP-21 which expires this fall. 

As a new intermodal hub for Saint Paul, the station will connect the Central Corridor Light Rail, Amtrak passenger service, local transit and intercity bus services and a bicycle center. The new light rail line and the station already have generated new housing, retail development, new jobs and increased economic growth. Saint Paul Mayor Chris Coleman, NLC’s President, told Congress in December that the federal support for the new rail line has generated more than $1.2 billion worth of investment in new housing and employment opportunities within the 18 station areas along the 11-mile route. Sixteen colleges, university and hospitals within blocks of the new line employ 67,000 people and are working together to strengthen the neighborhoods.

Similar stories in Normal, Ill. and Atlanta, Ga. demonstrate the power of strategic federal transportation investments. City leaders in Normal sought to bring back the city’s downtown but a TIGER grant helped them realize their plan, as Mayor Chris Koos told a Capitol Hill audience this week at an event sponsored by Transportation for America. With a new quarter percent sales tax, a four-percent hotel tax, and a TIF district, the city was able to invest in creating a welcoming place for community members to gather, eat and shop. Private investment followed with new shops and restaurants and plans for additional mixed-use office buildings and condos are being planned.

In Atlanta, Ga., the Atlanta BeltLine is developing a network of public parks, housing, retail and multi-use trails linked to transit along a 22-mile rail corridor. Funded by a Tax Allocation District (TAD), the project covers more than 6,500 acres of the city. Housing, jobs and new businesses continue to be established near the corridor including $400 million in new private real estate development has been invested within a block of the Historic Fourth Ward Park borders, and $775 million in new development has been invested within a half mile of the Eastside Trail. The $25 million federal investment, including an $18 million TIGER grant, continues to reap economic benefits for Atlanta, the region and the nation.

Against the backdrop of federal investment in transportation and its capacity to generate economic benefits, the president offered a new four-year proposal to fund federal transportation investments. Chairman Bill Shuster convened a roundtable to discuss the future of the federal transportation program and how to pay for it. With funding almost depleted, the president is proposing a $302 billion, four year transportation authorization. The current program expires on September 30 and funding from the federal gas tax is projected to run out before then. House Ways and Means Committee Chairman Dave Camp also unveiled a tax reform proposal that includes $126.5 billion to replenish the Highway Trust Fund.

In a statement, Chairman Shuster said, “I am committed to moving forward with fiscally responsible transportation solutions to promote competitiveness and economic growth, reform programs and focus our resources where they are needed most. Chairman Camp and President Obama have presented proposals that I hope will bring increased focus to the challenges facing the Highway Trust Fund and the importance of the federal role in our national transportation system.”

The national transportation network is a lifeline for our nation’s economy. The federal partnership to maintain that investment means jobs and economic growth. Finding a comprehensive funding solution will allow local leaders to make the long-term investments and planning decisions their communities need.

Community Partners Support Baltimore Neighborhood Growth

What makes a great neighborhood? Why do millennials for example, or any other demographic subgroup, choose one city over another or one neighborhood over another? Several factors that are consistent across many research studies include affordable housing, safe and walkable streets, access to employment and mobility networks, options for entertainment and recreation, and the often intangible characteristic known as buzz.

Baltimore_SIBaltimore city leaders have set a goal to attract 10,000 new families (some 22,000 individuals) by 2021. In addition to place-based strategies targeting downtown and neighborhoods, the city is seeking young knowledge workers and demonstrating its openness to immigrants. Extensive investments in education and new school construction are designed to lure families with children. Similar to other cities, it is the character of neighborhoods – solid housing stock, parks and open space, proximity to jobs and entertainment – that will have a significant influence on whether or not Baltimore can achieve ambitious growth goals.

A diverse set of partnerships lie at the heart of efforts in the City of Baltimore to revitalize neighborhoods, grow population, and support community prosperity. The coalitions across the city draw expertise and support from philanthropies, real estate developers, educational institutions, church congregations, community development stakeholders, business owners, housing advocates, and city officials. “Big tent” mobilizations are emphasized.  Whether in East, Central, or West Baltimore, partnerships focus on holistic approaches that address challenges of housing, neighborhood stability and vitality, human capital development, commercial improvement, and grass roots empowerment.

The city government does not lack for allies.  Among the most prominent (detailed in a related NLC case study) are: Southeast Community Development Corporation (SECDC); East Baltimore Development, Inc. (EBDI); Central Baltimore Partnership (CBP); BRIDGE Maryland; and the University of Maryland BioPark at the West Baltimore medical center campus.

There is considerable room for optimism in Baltimore. Driving around the city, whether in Hampden or along Charles Street, or the revitalized 36th Street commercial corridor, there are reminders that the city has good bones. Its iconic buildings, broad avenues, and promising neighborhoods constitute a firm foundation for prosperity and growth. Although challenges remain, the community partnerships are a formidable force for positive change in Baltimore.

Brooks, J.A. 2010
About the Author: James Brooks is NLC’s Director for City Solutions. He specializes in local practice areas related to housing, neighborhoods, infrastructure, and community development and engagement.  Follow Jim on Twitter @JamesABrooks.