Growth & Justice Blog

Less Government? We Tried That. It's Not Working.

The Star Tribune's front-page story today finds that "less government'' is the overwhelming consensus "vision'' for Republican gubernatorial candidates. Peggy Lee and most Minnesotans want to know: Is that all there is?   

Leaving aside that this mantra sounds more like hard-right, activist-energizing radio talk than inclusive vision casting — and has to be extremely disappointing to hundreds of thousands of moderate and progressive Republican voters — we need some context here.   

The Price of Government, an official state Minnesota Management and Budget measure, shows that we DO have less government over the last decade, ever since the no-new-taxes religion, like some southern invasive species, got a hold on the North Star State. (See page 13 of the PowerPoint presented at the capitol last week by State Economist Tom Stinson and State Demographer Tom Gillaspy).

The bar graphs clearly show that our governments are using about two percentage points less (15.5 percent in 2008 compared to about 17.5 percent through the 1990s) of our personal income share than those governments were spending when the economy was actually doing better. Huge income tax cuts in 1999 and 2000 left us with chronic  budget crises, and the promised payoff in sustained, tide-rising economic growth didn't materialize, either.  

Wealth concentration at the top got worse, bridge and road conditions deteriorated, public school course offerings were cut, and thousands of working low-income folks lost their health care. And our economy is slumping and beginning to underperform the national average on some key indicators.  

We surely could use some more judicious restructuring and redesign of how we do our government work. But the basic things government provides are essential for our shared prosperity and quality of life.  

NOTE: The Price of Government measure is one of the most comprehensive of all the measures we have to describe the size and role of government. It counts state and local government revenues as a percentage of total income and therefore accounts for inflation, population growth and economic growth. It was instituted at the behest and with the approval of business groups in the late 1980s.

— Dane Smith

Funders Collaborative seeks benefits "beyond the rail"

Today I took a ride along the future Central Corridor Light Rail Line. (Can we get a new, Hiawatha-like and less colonic-sounding name, stat?)

The guided bus tour was sponsored by the Central Corridor Funders Collaborative to highlight some of the big picture issues associated with the new line, scheduled for completion in 2014. Fittingly, it began in St. Paul's Frogtown and ended at Prospect Park in Minneapolis, the neglected middle of the route linking the two downtowns.

In many ways, it's the stretch with the most to gain or lose — where small businesses will thrive by reaching more customers or go under because their current customers get diverted by the construction; where residents will find it easier to get to jobs and other opportunities in the metro area or be driven out of their homes by higher rents; where the ethnic character of the area gets enhanced or scattered, just as happened when I-94 was built.

The Funders Collaborative is a group of local and national funders exploring ways to promote planning and collaboration to ensure that adjoining neighborhoods, residents and businesses broadly share in the benefits of public and private investment along the Central Corridor Light Rail Line.

The Collaborative supports the building of the light rail line, but it recognizes these big public infrastructure projects get planned, funded and built with a focus on ridership and construction and operating costs. How the investment benefits the local businesses, surrounding neighborhoods, and the people who live, work and access opportunity along the line is a secondary consideration.

It's not that small business success, affordable housing, and the quality of the places that grow up around transit lines are overlooked entirely. But the federal funding formulas that decide where transportation dollars go don't weigh these issues with the same gravity — even though they are arguably far more important for the community over the long run. It also means the parties responsible for getting the line built — in this case, the Met Council — can't get sidetracked by niceties or they risk losing the funding because a competing and more spartan project shows better numbers.

What happens next is predictable. Big institutions (MPR and U of M) get comparatively more attention to their needs, while poor neighborhoods are told to wait. Less powerful groups file lawsuits. Various advocates feel shut out of the process and compete with each other for scarce resources. And public officials who have tried to enlist broad participation tear their hair out.

Turning the Central Corridor into a place of opportunity — especially for the people who already live and work there — is a far more noble goal than getting more people to use transit. And most of the businesses, neighborhoods and public officials connected to the line would agree that's the goal most worth pursuing.

But no single government entity is in charge of the big picture for the whole line. Coalition-building is not the way most residents want to spend their spare time. Community-led planning doesn't rate many news stories. And nascent efforts by barely established groups don't fit the way foundations traditionally give out grants.

Until the Funders Collaborative came along, no one had accepted the role of helping the promise of transit-oriented development happen on a comprehensive, corridor-wide scale. 

The rail line has yet to be built, and the efforts of the Funders Collaborative and its community partners have yet to spread the benefits "beyond the rail." We won't see the results for a decade or more, so today's tour was hardly stop-the-presses news. But it's a good start.

— Charlie Quimby has done some consulting with the Central Corridor Funders Collaborative

When Stimulus Worked for All.

From our Golden Valley yard, we can hear the thrum of traffic from Hwy. 100, once known as the Belt Line and Lilac Way.

Today, there's little evidence in this sound-wall-to-sound-wall carscape of a connection to the Great Depression and the Works Progress Administration (WPA). But a restored Lilac Park, dedicated this week near Highways 7 and 100, offers a modest reminder of what public investment can accomplish — and what may be lacking in today's attempts to stimulate an ailing economy.

This appeared in MinnPost today.

— Charlie Quimby

Funding transportation through "value capture"

After the bruising battle over the 2008 transportation bill, the Legislature requested a study of "value capture" as a potential way to raise revenue for future infrastructure investments in Minnesota. The University of Minnesota's Center for Transportation Studies has released its analysis of eight potential strategies for funding transportation based on the concept.

Currently, transportation improvements are funded by general revenue (based on the assumption that all benefit indirectly from the transportation network) and user fees, such as gas taxes and transit fares. The rationale for value capture is based on the relationship between transportation networks and urban land value. [See diagram.]

Investment in transportation infrastructure — ranging from new roads and freeway interchanges to light rail lines and transit stops — improves accessibility to desirable locations such as jobs, shopping and entertainment. Property thus made more accessible tends to become more valuable. Developers and landowners benefit from this higher land value.

Value capture mechanisms seek to harvest a payback from the value created by the public investment. The revenue is then directed to pay off the improvements or finance new ones.

The study is quite lucid in spelling out the pros and cons of eight potential value capture approaches based on four criteria — economic efficiency, equity, sustainability, and perhaps most important for the Legislature, feasibility.

It will come as no surprise to students of tax policy that the most feasible measures have relatively low visibility to general taxpayers.

Perhaps the most intriguing of the eight approaches is Transportation Utility Fees (TUFs). TUFs treat transportation networks like other utilities and can be based on factors related to transportation demand, such as parking, square footage or type of facility. They are simple to administer and generate a stable revenue stream. But, as with any new "fee," there are drawbacks to getting them authorized in the first place.

The 12-page policy summary, "Harnessing Value for Transportation Investment," is worth a look by anyone interested in finding new ways to raise money for transportation. [Download Policy Summary]

— Charlie Quimby

Hollowing out the public sector affects public safety

Our continuing and increasingly dubious experiment with starving the public sector in Minnesota is producing almost daily reports of questionable budget cuts.   A Star Tribune front-page story on disappearing lifeguards at public beaches is the latest manifestation of our increasingly penurious fiscal policy.    Anti-government conservatives like to claim that much or most of government investment is unnecesssary or superfluous, and that all we really need are military forces, courts and police to protect property.   But it turns out that a relentless ratcheting down of public investment affects public safety in myriad ways:  crumbling bridges, less attention to mesothelioma incidence in northern Minnesota miners, Local Government Aid cuts that force police and emergency service layoffs, hospital reimbursement cuts that hamper emergency rooms in the midst of an ongoing swine flu pandemic, and on and on.    Public safety is a primary responsibility of our entirely legitimate and mostly effective state-and-local government systems.    Most of the things those governments do eventually have something to do with public safety and providing for the "General Welfare," an often overlooked primary goal that is spelled out in the United States Constitution.    And these systems can't be funded without fair and ample tax revenues.

Dane Smith

Infrastructure investment could raise its sights

A recent commentary by Chip Halbeck, executive director of the Minnesota Housing Partnership, asks: what is infrastructure?

If it means the basic physical makeup that enables a community to function, I argue that housing fits the definition. Fortunately, for the most part the free market has provided communities with the needed housing component of infrastructure. But there is a sizable and growing segment of the population for which the market cannot provide homes that are both affordable and safe.

Halbeck's piece suggests a new federal stimulus package that would fund local government grants to make low-income housing safe and more energy-efficient. He argues that such rehab work would also provide more low-skilled and entry-level jobs in more places than would large scale infrastructure projects. (Architecture 2030 has proposed a similar national stimulus buy-down program for residential buildings and an accelerated-depreciation program for commercial buildings.)

Whatever you think of his proposal, the larger point is apt.

The nation's financial woes are rooted in a housing catastrophe that has dumped thousands of foreclosed homes on the Twin Cities market alone. Vacancies and abandonments threaten the fabric of neighborhoods. Yet, instead of recognizing this impact, there's a transportation-centric coloring to our view of infrastructure spending. Roads, bridges, transit and auto companies dominate the discussions.

Moving people and goods more efficiently from place to place is a worthy economic goal — but we cannot ignore the condition of those places. And we know that more lanes and extensions into exurbia  can ultimately increase energy use and environmental impact.

What's more, transportation only consumes 29 percent of the nation's energy, while more than 51 percent goes to electricity generation and residential and commercial heat and power. Increasing the energy efficiency of our building infrastructure could provide long-term paybacks for building owners, renters and the environment.

It can also provide long-term savings for the public.

One recent example is the recently built Schaar's Bluff Gathering Center in Dakota County’s Spring Lake Park Reserve. The structure is 90-95 percent more energy efficient than comparable parks facilities, and ranks within the top 1 percent of all sustainable structures as compared to the U.S. Green Building Council's registered buildings.

It generates its own power with an onsite wind turbine, reuses rainwater to flush its toilets, and incorporates wood reclaimed from a sawmill that park employees once operated on the site.

The building is designed to react to current weather conditions. Its HVAC system is linked to operable windows so that the two don’t work against each other; automated shading devices react to the sun’s path. It even feeds local animals with its edible landscaping.

[design: MS&R photos: Andrea Rugg]

The designer, Meyer, Scherer & Rockcastle, was the first Minnesota architecture firm to sign on to Architecture 2030's standards for meeting fossil fuel, greenhouse gas emission and energy consumption goals.

The project began as a conventional building, but evolved through a design process that tapped  an inspiring site, a parks manager's passion for sustainability and the County Board's openness to a non-traditional approach.

Conventional procurement would have focused on managing the design/build budget and been leery of innovation. The major difference at Schaar's Bluff was a county staff dedicated to the environment who felt secure enough to encourage the unconventional and take it to the public for their input.

Starting from a carbon neutral "energy budget" helped lead to a building that stayed within the fiscal limits while delivering a long-term a balance of economic, aesthetic, environmental and social values.

In the desire to create economic stimulus, we should not labor only to lay rebar and concrete. Dakota County has shown how visionary government can render enduring beauty and public utility in difficult times.

— Charlie Quimby

Safe bike travel offers lessons in infrastructure

The Star Tribune editorial, "Don't let thugs derail bike trail use," is right in spirit. But in response to a rash of muggings along the popular central bikeway, it makes an array of suggestions — better lighting, increased police presence, night-vision security cameras, citizen bike patrols and avoiding riding alone — that miss a larger point about safe infrastructure and its use by the public.

Safety strategies that rely on counter-measures and modified user behavior represent a design failure. And a purely engineering- or cost-driven approach to infrastructure almost guarantees we will end up with issues later.

The editorial notes that "portions of the greenway and Hiawatha trails are more dangerous because of the surrounding geography and inadequate lighting."

Another way of putting it would be: The danger comes from treating commuting purely as a problem of moving most efficiently from point-to-point. The trail fails to recognize its true connections to the surrounding city.

The trails are more dangerous because they were built like roadways and rail lines — for specialized vehicle use through a featureless trench or concrete wasteland — rather than as human-scaled outdoor passageways that naturally connect people and destinations. This problem "geography" along Hiawatha was created decades ago by scrubbing the landscape of trees, residences and commercial buildings so it could be remade as a transportation corridor. Then the entire area was neglected until recently.

Don't get me wrong. I love the Midtown Greenway and use it at all times and seasons. The designers and community advocates who championed the trail were well aware of its challenges, and they incorporated features to mitigate problems with the location. It will only get better as more community connections are made and more people discover it.

But here's what real safety looks like along a bike trail or city street.

We can design our infrastructure like parking ramps and equip them with cameras, emergency phones and occasional patrols. Or we can emulate our parks and most beloved commercial streets — places that encourage a mix of activities and promote gathering, visibility and access year-round.

Reaching our destination safely and efficiently is indeed important, but we ignore the quality of the journey at our peril.

— Charlie Quimby

Moving toward more sustainable, efficient and affordable transportation

Next year Congress is slated to take critical action on federal legislation that will shape most of the nation’s transportation system for years to come — action that could steer our nation toward more sustainable, efficient and affordable transportation. 

Congressional reauthorization of this surface transportation legislation presents an excellent opportunity for smart thinking about how best to invest public sector dollars in ways that spur growth and expand economic prosperity for all Americans, right in keeping with the Growth & Justice philosophy. 

A national coalition called Transportation for America (T4America) issued an ambitious call this month for a federal transportation package that deals with transportation challenges and policies in a broader context of important national policy issues, including economic opportunity, climate change, energy security, health, housing and community development.

T4America’s brief, five-point platform [download pdf] points out the national economy depends upon our network of roads, rails, transit lines and pathways but notes, too, that the transportation network is in disrepair and offers too few affordable, efficient and convenient options to too few Americans.

The five points from T4America are sensible enough: Modernize and expand the nation’s transit and rail network to reduce our dependence on oil and to better connect metro regions.

• Modernize and expand the nation’s transit and rail network to reduce our dependence on oil and to better connect metro regions.
• Invest in cleaner, greener modes of transportation, including transit, bikeways and walkways.
• Invest in and restore existing highways, bridges and transit systems before building new roads that will require more public dollars for maintenance and repair.
• Stop wasteful spending on federally funded projects that offer little in the way of economic return and on projects that increase our dependence on oil.
• Offer more affordable and efficient transportation options to help Americans avoid traffic congestion and high gas costs, and promote housing options that match well with new possibilities offered by the evolving transportation system.
  

T4America says these policy pathways will benefit the nation by reducing the transportation costs for American families, creating jobs, reducing our dependence on oil, helping communities cope with traffic congestion, reducing the carbon emissions that contribute to climate change, and restoring neighborhoods that retain their value as places because of their transportation networks and their access to job sites.

Congress would be wise to consider the T4America platform as it begins work on the federal transportation package that will lay out specifics for the next six years of investments, policies and choices regarding highways, bridges, transit, safety, and bike and pedestrian routes. 

The ideas in the platform undoubtedly will get fair airing from Minnesota Congressman Jim Oberstar as he leads the federal reauthorization effort from his position as chair of the U.S. House’s Committee on Transportation and Infrastructure.  Good thing.

— Matt Kane

Reverse privatization improves emergency, fire services

GRAND JUNCTION, COLORADO — As a part-time Colorado resident (but income-tax-paying Minnesotan), I keep an eye on developments in governance and tax policy out here. After all, this is the birthplace of the Taxpayers Bill of Rights (TABOR), and Colorado's experience offers some lessons to Minnesota legislators who might get overly excited about managing state revenues and budgets by referendum.

Last week I ran across a story that might give pause to those who are enamored by the prospect of privatizing public services.

In Grand Junction, starting two years ago, the city fire department has done a sort of reverse privatization — taking over ambulance services once run by a private company and assuming the role as sole ambulance provider for roughly 1,200 square miles of the Grand Valley.

Critics blasted the city’s takeover of emergency medical services because it was estimated to cost taxpayers $1.55 million over five years. They also panned the ouster of American Medical Response and the company’s 28 employees who served the community for a decade.

By all accounts, AMR had done a good job. I talked with police and county sheriff officers who praised the reliability of service and competence of the company's workers. Area hospitals were concerned, too. 

But two years later, criticism in this conservative community of about 120,000 has melted away. Ambulances get victims to the hospital faster. Fire stations are better staffed (with 35 people per day versus 21). Crews going to fight fires respond faster, and captains on the scene are able to better coordinate efforts and oversee safety.

And the department is operating in the black.

Assuming responsibility for taking medical patients to the hospital and between medical facilities has generated more money for the Fire Department than first anticipated. Operations Chief Jim Bright said he expects the department to end the year with a $250,000 fund balance.

 

One former AMR worker who now works for the department said even though AMR provided high-quality emergency medical services during its tenure: “I saw the side of things where it was always down to the very bottom dollar.”

The dollars still matter, but now they're all going back into the community and the people being served.

— Charlie Quimby

Managing transit: A conversation with the Civic Caucus

In June I met with members of the Civic Caucus to discuss ongoing, major transportation issues in Minnesota. The non-partisan Civic Caucus, described as “a Minnesota e-group of senior policy wonks,” convenes once a week to engage in dialog on public issues and surface creative proposals for change.

This post is based on their report of our discussion. A second post will address congestion, suburbs vs.cities and other issues they raised.

The divided metro transit structure is a practical accommodation to reality.

Commenting on divided transit authority between the Metropolitan Council and county governments in the metro area, Kane said the arrangement is a practical accommodation to reality. A new quarter-cent sales tax for transit is, by law, being imposed by county governments, not the Metropolitan Council.  It is somewhat unrealistic to put the county commissioners on the hook for raising the funds and expect them to hand off decision-making authority to another government entity. 

Thus, the counties are empowered to decide how the new tax money will be distributed, consistent with the Metropolitan Council's policy plan. In the best of all worlds, you'd probably place more authority in the Council, but we have to be practical, he said. Moreover, many legislators consider the Council to be too closely tied to the Governor, because all Council members are appointed by the Governor to terms that are co-terminus with the Governor.

Growth & Justice is not a fan of the sales tax, Kane said, because it hits lower income persons disproportionately.   

Minnesota transportation funds have been distributed as “entitlements,” rather than according to need. Fairness and accountability are likely to improve.

It was noted that several weeks ago, Ken Orski, a national transportation consultant, was critical of the way transportation funds are distributed in Minnesota. Orski's concern was that the funds are largely distributed to different levels of government according to statutory or constitutional formulas that bear little relationship to need.  In effect, Orski said, the funds are "entitlements" for various levels of government.

Kane noted that the 2008 Legislature changed a formula for distribution of funds among counties to give greater account to transportation needs, not just an automatic distribution among counties, irrespective of needs. He also said that the Legislature has an interest in assuring that all parts of the state are treated equitably in distribution of revenue.

There are good reasons to place authority for transportation at the metro level as well as the state level.

A Civic Caucus member inquired whether more leadership and planning responsibility ought to exist at the state level, because of the critical role that transportation plays in the overall economy of the state.

Kane agreed that a statewide transportation system allows the safe and easy movement of people and goods.  It makes places accessible to people. And it lays the base for business activity that fosters economic prosperity. Commerce needs roads, and businesses incur costs from congestion delays and poor road conditions.  Wise investments in transportation infrastructure help put Minnesota’s households in a better position to benefit from economic growth. And a high-quality transportation system makes for faster commutes, reduced delays, fewer accidents, less fuel consumption and better air quality.

He noted, however, that it is useful to place some authority at the metro level, instead of with the state, because experience nationally has shown that metro-level decision makers are more likely to explore a variety of options for dealing with the much more complex transportation problem in the metro area, and more likely, too, to consider transit as a viable option. Because of the much larger number of trips and the accompanying congestion in the metro, investments in transit are important.

— Matt Kane