Lesson of Glendale, Arizona: don’t put so much public money into sports stadiums

The Super Bowl will be played in Glendale, Arizona but the suburb’s push to become a sports center has not exactly paid off:

As the Coyotes and Cardinals sought new facilities in the early 2000s and efforts failed to build them in other parts of the Phoenix area, Glendale stepped in. The city helped pay for the Coyotes’ arena with $167 million in bonds in 2003, and as the hockey team’s finances began to fade during the recession, Glendale went all-in to keep the team in Arizona. The city dished out $50 million earlier this decade to keep the team and continues to make annual payments toward the arena, but the money it is getting in return has not met expectations.

The football stadium was built in 2006, but Glendale was not on the hook for the costs of the $450 million retractable-roof facility. It was funded primarily with new taxes on car rentals and hotels in the Phoenix area, but that financing hit a snag last year when a judge ruled that the car rental tax was unconstitutional, leaving a major funding source for the Super Bowl venue in jeopardy. The issue is still being argued in the courts.

Glendale is far from alone. Cities and states nationwide have long struggled with how much public money to spend on stadium projects. The effort to build a new stadium for the Minnesota Vikings became embroiled in controversy over a financial commitment by the state that opponents said was excessive. The St. Louis Rams are at the center of a debate over whether to spend public money on a new stadium. Topeka, Kansas, is immersed in a fight over a motorsports track that has drawn comparisons to hockey in Glendale…

In the case of the Super Bowl, he believes the city is paying dearly. He said Glendale will actually lose a “couple million dollars” by hosting the event. It’s spending huge amounts of money on overtime and police and public safety costs associated with hosting the Super Bowl but getting very little in return.

Super Bowl visitors are mostly staying in Phoenix and Scottsdale and only showing up in Glendale on game day, meaning the city won’t see much of a boost in tax revenue. And the city was hoping the state would reimburse Glendale for its police overtime costs, but lawmakers have scoffed at the idea.

Teams and cities typically sell stadiums as engines for economic development. Think of all the fans who will be there! You can build around the new facilities! This will put your city on the map! But, such stadiums come with big costs including tax money that is often used as well as a whole host of other infrastructure concerns (from police to building hotel rooms). And the winners in such schemes are often the team owners who don’t have to pay completely out of pocket for facilities that can immensely boost the value of their team. (A thought: just imagine a team owner selling the team for a big profit – and many current sports franchises would turn such a profit today – and having to reimburse the community for costs incurred.)

But, if Glendale hadn’t built these stadiums, some other community might have fallen over themselves to make it happen…

Loss of housing wealth hits black suburbanites hard

The housing and economic crisis of the last decade has hit black suburbanites particular hard:

But today, the nation’s highest-income majority-black county stands out for a different reason — its residents have lost far more wealth than families in neighboring, majority-white suburbs. And while every one of these surrounding counties is enjoying a strong rebound in housing prices and their economies, Prince George’s is lagging far behind, and local economists say a full recovery appears unlikely anytime soon…

The recession and tepid recovery have erased two decades of African American wealth gains. Nationally, the net worth of the typical African American family declined by one-third between 2010 and 2013, according to a Washington Post analysis of the Federal Reserve’s Survey of Consumer Finances, a drop far greater than that of whites or Hispanics…

Not only is African American wealth down, but the chances of a quick comeback seem bleak. Just over a decade ago, homeownership — the single biggest engine of wealth creation for most Americans — reached a historic high for African Americans, nearly 50?percent. Now the black homeownership rate has dipped under 43?percent, and the homeownership gap separating blacks and whites is at levels not seen in a century, according to Boston University researcher Robert A. Margo…

Many researchers say the biggest portion of the wealth gap results from the strikingly different experiences blacks and whites typically have with homeownership. Most whites live in largely white neighborhoods, where homes often prove to be a better investment because people of all races want to live there. Predominantly black communities tend to attract a narrower group of mainly black buyers, dampening demand and prices, they say…

Scholars who have studied this dynamic and real estate professionals who have lived it say the price differences go beyond those that might be dictated by the perceived quality of schools, or the public and commercial investment made in particular neighborhoods. The big difference maker, they say, is race.

In other words, simply promoting homeownership – a key part of the ideal of the American Dream and also something taken as a sign that various groups have made it – is not the complete answer for thinking about equality among different groups. What homes people own and where they are located also matter. Decades of research in urban sociology and related areas shows that blacks and other minorities often don’t live in the same suburban settings as white suburbanites. Their homes tend to be located in poorer neighborhoods and neighborhoods that have higher non-white populations. This is due to a variety of reasons including long-term white wealth that gives whites better opportunities to move to wealthier and whiter places, zoning practices in wealthier communities that tend to limit cheaper or affordable housing (examples here and here), mobility patterns among whites that show they leave neighborhoods and communities as they become more non-white (the process of “white flight” continues in some suburban areas), and patterns of mortgage lending as well as renting that tend to take advantage of poorer and non-white residents. Tackling the issue of residential segregation still matters today even as more minorities and poor residents move to the suburbs.

 

Translating communism into urban design principles

Here is a look at how the Soviet Union designed cities:

With this assumption, Soviet planners made some logical steps to promote density. They built nurseries and preschools as well as theatre and sports halls within walking distance to worker’s homes.   Communal eating areas were arranged. Also, wide boulevards were crucial for marches and to have a clear path to and from the factory for the workers. The goals of the “socialist city” planners were to not just transform urban planning but human behavior, helping such spaces would breed the “urban human”…

Alexei Gutnov and his team set to create “a concrete spatial agenda for Marxism”. At the center of The Communist City lay the “The New Unit of Settlement” (NUS) described as “a blueprint for a truly socialist city“. Gutnov established four fundamental principles dictating their design plan. First, they wanted equal mobility for all residents with each sector being at equal walking distance from the center of the community and from the rural area surrounding them. Secondly, distances from a park area or to the center were planned on a pedestrian scale, ensuring the ability for everyone to be able to reasonably walk everywhere. Third, public transportation would operate on circuits outside the pedestrian area, but stay linked centrally with the NUS, so that residents can go from home to work and vice versa easily. Lastly, every sector would be surrounded by open land on at least two sides, creating a green belt.

Gutnov did acknowledge the appeal of suburbia — “…ideal conditions for rest and privacy are offered by the individual house situated in the midst of nature…”, but rejected the suburban model common in America and other capitalist countries. Suburbs, he argued, are not feasible in a society that prioritizes equality, stating, “The attempt to make the villa available to the average consumer means building a mass of little houses, each on a tiny piece of land. . . . The mass construction of individual houses, however, destroys the basic character of this type of residence.”

The author is insistent on comparing these to current planning practices but let’s be honest: all urban planning is based on some sort of ideology. Many Americans may prefer suburbs to these Soviet cities but suburbs have their own logic based around private property, individualism, and local control. In other words, neither Soviet cities or American suburbs “just happen”; there are a series of historical events, decisions made by key leaders (often in government and business), and meanings that contribute to particular spatial landscapes.

New survey suggests 66% of millennials (who want homes) still prefer suburbs

Perhaps that generational shift back to the city will take some time: a new survey shows a majority of millennials would prefer to live in suburbs.

Some demographers and economists argue that the preference of millennials, also called Generation Y, for city living will remain long lasting. And surveys of these young urban residents have tended to show that they don’t mind small living quarters as long as they have access to mass transit and are close to entertainment, dining and their workplaces.

But a survey released Wednesday by the National Association of Home Builders, a trade group, suggested otherwise. The survey, based on responses from 1,506 people born since 1977, found that most want to live in single-family homes outside of the urban center, even if they now reside in the city…

The survey, which was released at the association’s convention in Las Vegas, found that 66% want to live in the suburbs, 24% want to live in rural areas and 10% want to live in a city center. One of the main reasons people want to relocate from the city center, she said, is that they “want to live in more space than they have now.” The survey showed 81% want three or more bedrooms in their home…

The survey results, though, could be skewed because they included only millennials who first answered that they bought a home within the past three years or intended to do so in the next three years. That excluded young people who intend to rent for many more years, which is a large and growing group, in part because of hefty student debt and the tight mortgage-lending standards of recent years.

Interesting twist there at the end – of those who have or intend to buy homes, the suburbs are still the place (and only 10% wanted to live in a city center) to go.

I do wonder at the three categories presented: city center, suburbs, and rural areas. While the last one is pretty easy to define, what is the boundary between the city center and suburbs? If I’m thinking about Chicago, does living in the city center include every part of the city of Chicago (which has a lot of neighborhoods of single-family homes) or does it refer to living in the denser Loop and right nearby?

Debate the data: are millionaires leaving New Jersey in large numbers?

A new report suggests some millionaires have left New Jersey:

New Jersey lost roughly 10,000 millionaire households, but those affluent families who remain still account for 7 percent of the whole state, the researchers said…

A high tax rate for top earners may have led to some migration out of the state, according to David Thompson, the lead researcher.

By losing those 10,000 millionaire households, the Garden State returns to third, where it was ranked from 2010 through 2012. Since the last report, Connecticut lost only 1,000 millionaire households, as it vaulted to the second spot, the group said.

And alternative interpretations:

“If millionaires were truly trying to flee NJ’s top income tax rate, we probably would have lost a lot more when the rates were higher,” Whiten said. “But during the 2000s NJ almost doubled the number of tax filers above $500K at a time when the tax rate was increased on them, twice.”Wealth has been reported leaving the Garden State before, however. In 2010, a Boston College team found that in a five-year period some $70 billion in total wealth left for other parts of the U.S.

Last year, a report by the Morristown-based Regent Atlantic wealth management firm released a report entitled “Exodus on the Parkway” that claimed so-called “tax migration” began in 2004, with the state’s passage of the “millionaire’s tax.” The report found that a couple with an income of $650,000 who moved to Pennsylvania would save some $21,000 per year in taxes, adding up to $1.65 million over 25 years, if invested. Most families with incomes of $500,000 per year or more were departing New Jersey for either the Keystone State or Florida, the Regent Atlantic authors added.

“The phenomena is there, that people are leaving – but people in New Jersey have high incomes,” said Joseph Seneca, professor of economics at the Edward Bloustein School of Planning and Public Policy at Rutgers University.

My interpretation: no one really knows whether 10,000 millionaire households leaving is a big number or not. If the true figure was 5,000, might those who oppose higher taxes still argue that taxes are pushing a large number to leave? And if the true number was 15,000, would this be enough evidence that taxes really are making a difference? Because this appears to be an ideologically laden debate, each side can look at the 10,000 figure and make a reasonable interpretation.

Here are two ways around the issue that both make use of comparisons. The first way would be to compare the New Jersey leavings over the years. Is the 10,000 figure more or less than years past? The second would involve comparing the leaving rate across states. This new report looks at millionaires per capita across states but why not compare the leaving rate per capita across states? Then, people in New Jersey could decide whether they are concerned with having similar or different rates compared to states with other policies.

O’Hare Airport now officially world’s busiest airport again

Occasionally status anxious Chicago can breathe a little easier: O’Hare was just certified the world’s busiest airport.

While 2014 traffic at O’Hare was down by 0.2 percent, it lost less traffic than the Atlanta airport, where traffic declined by 4.7 percent, according to new FAA data. O’Hare had 881,933 arrivals and departures; Atlanta had 868,359.

But the Atlanta airport is likely to retain the title of busiest airport for passenger traffic.

City officials have said international passenger volume have helped O’Hare totals. In the last 18 months, O’Hare and Midway airports added six new international airlines and dozens of destinations, according to the city.

O’Hare regains bragging rights to the title it had mostly owned since the dawn of the Jet Age, when it surpassed the number of flights at Midway Airport, which had been the leader.

As a transportation center, this looks good for Chicago. Yet, there are two more negative signs: Atlanta may still have more passengers (which number matters more?) and flights were down (Which may have more to do with airlines consolidating as well as trying to cut costs by filling existing flights). Additionally, the lead over Atlanta isn’t that big. I’m guessing this means the competition will continue for years to come and I am curious to know if Chicago and/or O’Hare have some plans in the works to keep their regained lead.

Happenings since Canadian National purchased the EJ&E tracks in 2008

Here is a recap of what has happened since the 2008 purchase of the EJ&E railroad tracks by Canadian National:

In December 2008, the Surface Transportation Board approved CN’s request to buy the smaller EJ&E, which extended in a half-circle from Waukegan to Joliet. Suburbs traversed by the EJ&E fought the plan, citing extra freight train traffic. The board agreed with CN that the purchase would reduce regional freight congestion but imposed numerous conditions on the railroad as a result and included a period of federal oversight until Jan. 23, 2015.

Last month, the STB extended the monitoring period until Jan. 23, 2017, citing concerns about additional freight traffic in the region.

Mongeau said the railroad’s acquisition of the EJ&E “gave CN what it was looking for — a route around Chicago,” that has a trickle-down effect on other railroads by taking its trains off other crowded tracks.

The railroad has spent $700 million on upgrades and safety improvements since 2008.

Twenty-eight out of 33 towns affected by the merger signed mitigation deals with CN, Mongeau noted. Holdouts included Aurora and Barrington, which fought against the merger and campaigned to extend the monitoring period.

In October 2014, there were 1,620 blocked railway crossings lasting 10 minutes or more on the EJ&E. In October 2009, early in the acquisition phase, there were just nine, according to CN data….

On tracks between Lake Zurich, Barrington and Hanover Park, traffic on the EJ&E grew from about five daily trains prior to the merger to 17 in October 2014.

This was a big issue for a number of suburban communities in the mid-2000s as they wondered how the purchase would affect freight traffic as well as block crossings, create more noise, and potentially harm property values. It sounds like the monitoring is intended to keep tabs on these changes and help ensure the railroad and communities work together. Yet, it is still important to keep the big picture in mind: moving traffic onto the EJ&E tracks can help alleviate freight traffic elsewhere, addressing the problem of the railroad bottleneck in the Chicago region. This sort of issue makes the case for metropolitanization where communities and government could come together and solve problems facing numerous municipalities.

Pace wants to “change the suburban transit environment” with new bus routes

Pace has an ambitious proposal intended to link important areas in the Chicago area via bus:

A wide-ranging network of suburban bus routes could transform the way people commute and shop, connecting people to job centers in Naperville, Elgin and Elk Grove Village, according to an ambitious $2.3 billion plan shared by Pace on Tuesday.

Express buses with high-tech amenities would take riders from the south suburbs to O’Hare International Airport. Or from McHenry south to Oswego via Randall Road. Or from Evanston to O’Hare along Dempster Street.

And buses would travel on the shoulder of the Jane Addams and Edens expressways, bypassing car traffic…

Pace has submitted its plan for an innovative suburban Rapid Transit Network to Congress, which asked for candidates for a program called Projects of National and Regional Significance. The agency revealed details of its proposal to the Tribune on Tuesday…

The network is composed of two service types: arterial bus rapid transit and suburban expressway service.

Mass transit that connects suburbs is sorely needed in the Chicago region. The current system of buses does little to add on to the existing hub-and-spoke railway system that connects the suburbs to downtown. New buses provide a flexible form of transport compared to railroads; rather than having a fixed track and sunk infrastructure costs, buses can take advantage of existing important roads and highways.

However, I suspect this plan has a lot of hurdles to overcome even beyond the federal funding they are seeking.

1. How do you get suburbanites to consistently ride the bus? Trains are one thing but buses seem to have a different status.

2. Can schedules between mass transit options be lined up?

3. Can the buses actually get people to places rather quickly and at most times of the day? The current bus system tends to take long amounts of time compared to driving.

4. Perhaps the most important question: is there enough density along the proposed lines to have consistent numbers of riders who need to go where the buses are going? Density contributes to riders which leads to more buses which leads to more options. Going to the airports makes sense – both Chicago airports are busy (O’Hare may just be the busiest in the world again) – as does more highway buses to Chicago but linking residences and businesses is a more difficult task. Downtown Naperville may be lively but how many live near there who would commute by bus elsewhere? Are there concentrations of people living along Randall Road? I wonder if there is any way to encourage denser developments – apartments, condos, townhomes, rowhouses – near such bus lines to help provide more potential riders.

MLK streets in the US contained in a “nation within a nation”

Many American cities have streets named after Martin Luther King Jr. and many are located within black areas:

Across the country there are 730 streets named after civil rights leader Rev. Martin Luther King Jr…

For his book “Along Martin Luther King: Travels on Black America’s Main Street,” author Jonathan Tilove visited nearly 500 Martin Luther King streets across the country. In his book, he described a “nation within a nation” as “a parallel universe.”

“For many whites, a street sign that says Martin Luther King tells them they are lost,” Tilove wrote. “For many blacks, a street sign that says Martin Luther King tells them they are found.”

And Dr. Martin Luther King Jr. drive in Chicago has its own complicated past:

Instead, a South Side designation was boosted by Mayor Richard J. Daley. It was a move Adam Cohen and Elizabeth Taylor describe as “disingenuous” in their Daley biography “American Pharaoh.”

Foes when King was alive, Daley, by supporting the renaming, was attempting to portray himself as a forward thinker on race relations ahead of the 1968 Democratic National Convention, the biographers said.

In dedicating the street, Daley “invoked King’s devotion to nonviolence in a verbal formation that made it sound as if Daley had the idea first,” Cohen and Taylor wrote.

Par for the course in a racialized country: where the effects of race extend even to street names. That said, I wonder what would happen in some major cities if there were efforts to extend MLK street into white and/or tourist areas…

“Using a Real Life SimCity to Design a Massive Development”

As a massive SimCity fan, I find this use of predictive urban models intriguing:

596 acres, 50,000 residents, $4 billion dollars and even a 1,500-boat marina: Everything about the proposed Chicago Lakeside Development, developer Dan McCaffery’s massive micro-city being built at the former site of the U.S. Steel Southworks Plant, is on a different scale. It follows that the design process for this mixed-use project requires a different set of tools, in this case, LakeSim, an advanced computer modeling program. Developed as part of a collaboration between the University of Chicago, Argonne National Laboratory, Skidmore, Owings & Merrill and McCaffery Interests, this program functions like a customized SimCity, analyzing and simulating weather, traffic patterns and energy usage to help architects and designers plan for a site that may eventually contain more than 500 buildings.

“A lot of the Big Data approaches tend to be statistical in nature, looking at past data,” says Argonne scientist Jonathan Ozik. “We’re modeling a complex system of interactive components, running the data forward, so what we end up having is your SimCity analogy, energy systems interacting, vehicles and people moving. What we’re doing here is using a complex systems approach to tackle the problem.”…

The challenge for planners is predicting how so many different systems and variables will interact. LakeSim gives them a framework to analyze these systems over long timelines and run millions of scenarios much quicker than past models — hours as opposed to days — asking “hundreds of questions at once,” according to Ozik. The program is a step forward from similar modeling software, especially valuable at a site that in most respects is being built from scratch.

This seems quite useful at this point but it will be necessary to look at this down the road once the site is developed. How much time did the model save? How accurate was the model? Did relying on such a model lead to negative outcomes? If this is a predictive model, it may be only as good as the outcome.

Interesting to note that the commenters at the bottom are wondering where all the people to live in this development are going to come from. I assume that demand is appropriately accounted for in the model?