Rushford, Minnesota, or Trading Places Part 2

From Thursday to Saturday of last week, I joined other members of the Minnesota Design Team for a Rushford project in Rushford, Minnesota.  The Design Team is a volunteer organization of planners of every stripe – our team included architects, hydrologists, a transportation planner, urban designers, public finance and economic development consultants. 

The process is akin to an extended charrette based on a volume of input received from community residents.  The goal is to give additional tools and ideas to towns across Minnesota, which they can tailor and implement to improve the economic climate, physical design and political efficacy of their community.  It’s worked statewide since 1983.

For most readers, Rushford’s name will conjur images of the flash flooding that devastated the town and surrounding region in August, 2007.  The U.S. Army Corps of Engineers presented recent findings suggesting the rainfall (in excess of 17 inches in areas of the watershed) approximated a “500-year flood” level.  Collecting from a large area, the water converged on Rushford, flowing at over five times its usual volume and reaching a rate of 38,000 cubic feet per second.  The impact of water that topped over levees and was trapped in town by the remainder of the dike system, has been tremendous.

The financial impact of the flood will exert a toll on Rushford for years to come.  Many homeowners did not carry flood insurance, noting its cost.  Today, mortgages remain due while some properties are now a lot with a hole in the ground, the homes having been demolished and removed.  The state of recovery for businesses appears to have benefited from a state-appropriated $35 million dedicated to relief for damaged businesses across southeast Minnesota. 

Still, citizens emphasized to us that Rushford, a settlement since the 1850s, has a long history of which the flood is just one recent chapter.  The physical attributes of the place are striking – the confluence of the Root River and Rush Creek, the high bluffs typical of the geologic form known as the Driftless Area in southeast Minnesota, western Wisconsin and northeast Iowa. 

Other strengths come to mind.  School enrollment has diminished modestly but is projected to be stable in the next 5-10 years.  Tax base has increased over 10% annually since 1999.  A company called Rushford Hypersonic recently announced a partnership with the University of Minnesota to develop nanotechnology products from University research and patents.  From one large coop employer in town, I heard words I don’t often hear:  “We have adequate access to a pool of skilled workers.”  Each of these trends is significant and positive.

Rushford and Washington, D.C. – the first subject in this series – are more different than they are alike.  However, one of the key themes I discussed in the last post was the need for public and private entities to invest together in the success of places and the people who create them.  Rushford is a great example of a community prepared to distinguish itself through investment of financial and sweat equity.  My chief hope, beyond their success, is that these investments address safeguarding the town from future flooding.

The Urban Engine, or Trading Places Part 1

Monument_bills

Welcome to the first in a short series of three posts inspired by three very different places.  I’ve spent today immersed in national and global issues thanks to the Federal Policy Forum hosted by the International Economic Development Council here in Washington, D.C. The second and third posts, as you’ll see, will address local development issues in a mid-size and small community.

Between the articles I read on the airplane, the content of the sessions and accessory conversations with other participants, I have notes on papers small and large hanging from folders and pockets and briefcase.  It’s all related to a notion I sketched out in a post about regional differentiation a few months ago, but I’d like to summarize a new line of inquiry related to the conference.

Bank of America CEO Ken Lewis and Pennsylvania Governor Edward Rendell have led an effort described in the publication of Retooling for Growth: Building a 21st Century Economy in America’s Older Industrial Areas (see a summary of the book here).  The content is unabashedly “metrocentric” in light of the following metrics outlined in a session today.  The nation’s largest one hundred metro areas:

• Use 12% of American land area;

• House and employ 65% of our population;

• Are home to 74% of college graduates;

• Generate 78% of patents; and

• Create 75% of gross domestic product.

In the words of Paul Brophy, a consultant who hatched the project, the metro areas are engines for economic, social, scientific and cultural development despite the increasingly conspicuous absence of a significant federal role or resources.  In particular, he says, to move the U.S. forward it is critical to harness and foster entrepreneurship, human capital, infrastructure and what he termed “quality of places” in our urban centers.  A few thoughts on the prospective form of such infrastructure and placemaking improvements:

• Establishment of a National Infrastructure Bank to provide coordinated, significant, long-term dollars for urban infrastructure reinvestment, with accountability measures in place for both the local and federal partners involved.

• Perhaps as part of or independent from the infrastructure bank, aggressively fund urban transportation networks, including transit.  Spendy, yes.  Essential to be competitive, definitely.  This month’s Urban Land magazine reports that the City of London’s Crossrail project will extend subterranean Underground lines at a cost of $30 billion.  The business community, in a testament to the project’s competitive potential, will fund much of the investment.

• Adoption of local, state and federal policy that recognizes the missed opportunity that vacant and polluted urban land represents, and enables its reuse as developed property or open space such as parks.

• Perhaps most germane to the Cents of Place forum, standardization of the development process and fundamental property tax reform is also in order.  In Minneapolis and St. Paul, Minnesota – contiguous and mutually dependent municipalities – zoning codes and the development process continue to remain estranged.  And, as documented by a property tax report I authored last year, the current property tax system stifles the concentration of tax base upon which the health of our urban areas (and the states that rely on them) will rise or fall.

• Adoption of at least a regional, and at best a statewide approach to subsidies that seek to attract businesses location.  This idea is hardly new:  See the Economic War Between the States report published by the Minneapolis Federal Reserve in 1994.

• Focus on retaining the talented people who arrive in your region from Bangalore or Missoula or Moscow, to pursue educational experience.  See the integrated approach Philadelphia has taken to housing, employing and engaging students before they graduate and leave.

Resolving these underlying finance and policy issues is a priority that simply can’t wait.

Still with me?  Then, dear reader, indulge yourself and browse over one other publication I encountered today:  The 2007 State New Economy Index compiled by the Kauffman Foundation.

Photo:  Musely, Flickr

The Urban Engine, or Trading Places Part 1

Monument_bills

Welcome to the first in a short series of three posts inspired by three very different places.  I’ve spent today immersed in national and global issues thanks to the Federal Policy Forum hosted by the International Economic Development Council here in Washington, D.C. The second and third posts, as you’ll see, will address local development issues in a mid-size and small community.

Between the articles I read on the airplane, the content of the sessions and accessory conversations with other participants, I have notes on papers small and large hanging from folders and pockets and briefcase.  It’s all related to a notion I sketched out in a post about regional differentiation a few months ago, but I’d like to summarize a new line of inquiry related to the conference.

Bank of America CEO Ken Lewis and Pennsylvania Governor Edward Rendell have led an effort described in the publication of Retooling for Growth: Building a 21st Century Economy in America’s Older Industrial Areas (see a summary of the book here).  The content is unabashedly “metrocentric” in light of the following metrics outlined in a session today.  The nation’s largest one hundred metro areas:

• Use 12% of American land area;

• House and employ 65% of our population;

• Are home to 74% of college graduates;

• Generate 78% of patents; and

• Create 75% of gross domestic product.

In the words of Paul Brophy, a consultant who hatched the project, the metro areas are engines for economic, social, scientific and cultural development despite the increasingly conspicuous absence of a significant federal role or resources.  In particular, he says, to move the U.S. forward it is critical to harness and foster entrepreneurship, human capital, infrastructure and what he termed “quality of places” in our urban centers.  A few thoughts on the prospective form of such infrastructure and placemaking improvements:

• Establishment of a National Infrastructure Bank to provide coordinated, significant, long-term dollars for urban infrastructure reinvestment, with accountability measures in place for both the local and federal partners involved.

• Perhaps as part of or independent from the infrastructure bank, aggressively fund urban transportation networks, including transit.  Spendy, yes.  Essential to be competitive, definitely.  This month’s Urban Land magazine reports that the City of London’s Crossrail project will extend subterranean Underground lines at a cost of $30 billion.  The business community, in a testament to the project’s competitive potential, will fund much of the investment.

• Adoption of local, state and federal policy that recognizes the missed opportunity that vacant and polluted urban land represents, and enables its reuse as developed property or open space such as parks.

• Perhaps most germane to the Cents of Place forum, standardization of the development process and fundamental property tax reform is also in order.  In Minneapolis and St. Paul, Minnesota – contiguous and mutually dependent municipalities – zoning codes and the development process continue to remain estranged.  And, as documented by a property tax report I authored last year, the current property tax system stifles the concentration of tax base upon which the health of our urban areas (and the states that rely on them) will rise or fall.

• Adoption of at least a regional, and at best a statewide approach to subsidies that seek to attract businesses location.  This idea is hardly new:  See the Economic War Between the States report published by the Minneapolis Federal Reserve in 1994.

• Focus on retaining the talented people who arrive in your region from Bangalore or Missoula or Moscow, to pursue educational experience.  See the integrated approach Philadelphia has taken to housing, employing and engaging students before they graduate and leave.

Resolving these underlying finance and policy issues is a priority that simply can’t wait.

Still with me?  Then, dear reader, indulge yourself and browse over one other publication I encountered today:  The 2007 State New Economy Index compiled by the Kauffman Foundation.

Photo:  Musely, Flickr

Private Sector: Repay Energy Improvements with Consequent Savings

Around the New Year, I received an ambitious invitation to provide research and policy analysis to University UNITED, as they pursue a stated goal to “make University Avenue the greatest street in America.”  UNITED is a coalition of regional boosters and community organizations currently working to maximize the impact of the coming light rail investment along the most prominent street connecting St. Paul and Minneapolis, Minnesota. I have since that time been coordinating research on business improvement districts and other policy measures for UNITED.

Energy_base_map_co2

In addition to its advocacy of transit-oriented development and concentration of urban tax base generally, UNITED has of late become more involved in efforts to evaluate carbon emissions for University Avenue and the region, and facilitating efforts to engage private partners in reducing the local carbon footprint. 

UNITED is working with partners to fill a key role in the process of managing emissions:  With HK Climate Solutions, UNITED is aggregating warehouse and office space along University Avenue into packages exceeding one million square feet.  Together, these buildings are then inspected for energy-conserving capital improvements, which are installed by third partner Johnson Controls.  Broadly speaking, the cost of the improvements is financed by Johnson Controls and repaid from the energy savings generated.  Once the equipment is paid for – and it’s typically amortized over ten years – all of the energy savings (which range around 20-50%) flow to the building owners.

Eddie Krakhmalnikov and Executive Director Brian McMahon are running the program, dubbed the University Avenue Green Street Initiative.  Krakhmalnikov says the real estate investors involved in the retrofits know the energy improvements “have huge effects, and are good not only for their image but their bottom line as well.”

Yesterday’s Star Tribune article on municipal efforts to manage carbon emissions noted that in St. Paul’s case, only 2% of emissions are from public sources.  Anne Hunt, aide to St. Paul mayor Chris Coleman, suggested that “trying to engage the private sector is going to be a big challenge.”  The promise of the UNITED/Johnson Controls/HK Climate Solutions initiative may well prove it surmountable.