Chicago is a global leader in data centers

The Chicago region is a world leader in data centers:

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The Chicago area is tied with Atlanta as the fourth-largest data center market in the world, behind Northern Virginia, Silicon Valley and Singapore, according to a new study by Cushman & Wakefield. The study cites low cost of land, a robust development pipeline and lower power costs than most large data centers as advantages for Chicago.

The study also notes that Chicago-area sites come with “sizable incentives,” a factor that helped bring Facebook/Meta to DeKalb.

In 2019, Illinois created the Data Center Investment Program, offering an exemption from state and local sales and use taxes for companies that invest at least $250 million and create 20 new operational jobs in a data center. The program also requires the data center to be carbon-neutral.

In other words, there is money to be made by putting data centers in the Chicago region.

But, what do data centers offer back to the community? They might sit in buildings that the public does not know are data centers. They may not offer that many jobs; the data center under discussion in DeKalb in the article cited above is a more than 2.3 million square foot facility on 505 acres that will employ 200 people. They are getting tax incentives.

Of course, this is the way the development game is played in the United States. If these deals are not cut, companies will claim they will go elsewhere and they can find more favorable conditions elsewhere. The new data center will end up in Iowa or a “business-friendly climate.” The tech companies are desired by many communities so they will get good offers.

More positively, part of Chicago’s strength over the decades is its position in key infrastructure. The center of important railroad routes. Busy airports. The convergence of commodities from the whole Midwest. The creation of financial instruments. And now data centers.

As technology changes, municipalities change their ways to capture tax revenue

More Americans are streaming television and movies. This means municipalities need to reconsider cable taxes. Here is one example from the Chicago suburbs:

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Village trustees Monday voted 4-2 to approve the 5% entertainment tax as part of its upcoming budget. The tax would take effect July 1.

Village officials budgeted $25,000 in revenue from the new tax, which would tack 77 cents onto a standard monthly Netflix subscription costing $15.49 or 15 cents to an Amazon video rental costing $2.99.

“This is a modern version of the original telecommunication tax,” Village Administrator Erika Storlie said, adding that the village has seen a decrease in taxes collected from cable subscribers as more people drop cable television in favor or streaming services…

Chicago adopted an entertainment tax charging 9% on streaming services in 2015. In March, a judge dismissed a lawsuit filed by Apple Inc. challenging the tax. Though Apple’s complaint was dismissed, the judge left the door open for Apple to file an amended complaint.

Evanston, where Storlie served as city manager before coming to East Dundee, has charged a 5% entertainment tax on streaming services since October 2020.

Several thoughts about this:

-This is a relatively small tax in this community: the story above suggest its will generate $25k in revenue. Even in a small suburb, the money this generates will only do so much?

-I could imagine the argument that infrastructure is required to provide streaming services and taxes like these would help communities cover these costs. (I could also imagine – very faintly – the logic of a vice tax to limit the hours upon hours that Americans spend in front of televisions and screens…but limiting television watching via taxation seems somehow un-American. )

-I do not recall seeing much about public discussions of such taxes within communities. Is the tax so small that it does not attract much attention? Do residents not have a compelling argument against a streaming tax?

-Entertainment taxes are sometimes used for visitors or more public activities such as tickets for sporting events or theater shows. A streaming tax is aimed more at residents than visitors.

Many municipalities need consistent tax revenue streams as they look to provide services and balance budgets. This is one way to help achieve that goal.

Autonomous railroads and the importance of shipping goods by train

An exploration of autonomous trains in the United States includes this graphic about how cargo is moved in the country:

At this point, railroad shipping is very important: roughly one-third of cargo goes via train. This only follows trucks. And I wonder how this data works when cargo goes much of the way via train but then needs to make it “the last mile” from the railyard to specific locations.

So how much might autonomous railroads help? Here is some suggestive data:

A European Union-funded study published in 2020 found that moving to newer systems for managing trains could increase the capacity of existing rail networks by up to 44%. An internal study by Wabtec indicates in the U.S. the increase could be even higher, up to 50%. An increase of that magnitude in the ton-miles carried by America’s rail network would be the equivalent of moving approximately one million fully loaded Boeing 747-10 passenger jet planes from coast to coast every year.

Combine this with autonomous trucks (which, according to this piece, may take longer than moving to autonomous trains) and drones and perhaps more future goods could be moved even more quickly.

Global supply chain problems lead to 25 mile train backup at Chicago area railyard?

As concerns mount about global supply chains, I found one Chicago connection involving the region’s important role in the nation’s infrastructure:

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In Chicago, one of the country’s largest railyards – the size of 500 football fields – was at one point backed up for 25 miles…Cities like Chicago and San Antonio – the busiest international land gateway in the country – have been particularly affected by the bottlenecks.

Chicago is an important railroad center for the United States. With multiple intermodal facilities, helpful nearby highways and airports, numerous warehouses, and port options, many freight trains carrying a lot of important material pass through the region.

With that said, where exactly do the train delays in the Chicago region fit within the larger supply chain problems? Most of the news I have seen on the topic emphasizes the problems at major coastal ports where ships are waiting to be unloaded. If the ports could move through the goods already waiting, would they simply then get stuck in Chicago and similar locations?

If the problems in the Chicago region are confined to railyards and intermodal facilities, I would guess most people in the region have little reason to know about the issue. They may notice empty shelves in stores but not know that some of the goods might just be a few miles away on a railroad track. Unless you happen to drive by such locations and see something – and some of them and their activity are visible from major highways – or hear something specific in the news, the supply chain issues could be anywhere.

Water shortage hits the Colorado River and the agreement governing water distribution dates back to 1922

Updating infrastructure to meet new challenges is an issue in numerous areas, including in securing water. The current case of the Colorado River illustrates how updating is needed:

The 1922 compact overestimated how much water was in the river system to begin with. And now there’s even less. On top of that, the rules about divvying up the water – whether you’re a city, an irrigation district, or a rancher – essentially operate like dibs or calling shotgun in a car.

The phrase that people like to use in the West is “first in time, first in right.” The water users who arrived first in these places where the water is used and claim the water when they got there, hold the most senior water rights, and their water rights remain senior no matter who comes after them. Those senior water rights trump junior water rights even to this day, with an exception: The law says that if you don’t use those senior water rights to their full extent every year that they could be confiscated and given to somebody with more junior water rights…

Why has the frontier mindset survived to 2021 in the way we think about and legislate water?

Part of it is cultural. The culture of the West survives. In the north, in the mountains, it’s a culture of rugged individualism, and in the south, it is still a bit individualistic and conservative. The rights to the water track to the history of the place, not to how it has evolved in more modern times. [These] cities didn’t exist in the mid-1800s, so they have very junior water rights now, even though that’s where most of the people are. So literally the largest volume of water goes to the people in places with the deepest historical roots.

Future battles about access to water will be fierce, particularly in places where less water is available than in the past.

Will this slow growth in states where growth has been a feature of life for decades? This could affect communities, metropolitan areas, states, and a whole region.

Does this help break the obsession Americans have with green grass lawns? The drought in California half a decade ago could have been just a taste of the future.

Does this become a major issue in elections? How exactly does a water distribution renegotiation occur, particularly if elected officials have little direct influence?

What would a more collectivist mindset to water look like in the United States compared to a more individualistic approach or one rooted in history in the area? I could imagine a quick switch of systems would be difficult but phasing in changes over time might be possible.

Adjusting city infrastructure to meet new challenges

What is underneath the streets of older major cities may not be enough to face new weather patterns and additional challenges cities face today. Here are some of the efforts from recent years in New York City:

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New York had its first climate-related wake-up call nine years ago, when Hurricane Sandy brought a storm surge that flooded low-lying areas and, yes, subway stations. Since then, the city has spent almost $20 million on climate-proofing the city, according to the Mayor’s Office of Resiliency. But some of that funding went to solving a different problem than the one presented by Ida: water coming from the rivers. This week, all the wet stuff fell from the sky, threatening even areas above sea level…

Now, after years of updates, 60 percent of New York City has a combined sewer system, which uses a single pipe to carry both wastewater and stormwater to treatment plants. During heavy rainstorms, the system can get quickly overwhelmed. The detritus of city living—trash, plants, general gunk—clogs drains, further gumming up the works. “So if you get a really big kahuna like this, I don’t think it really has a shot at draining that out fast enough to avoid flooding,” says Farnham.

The city has worked to separate those combined sewer systems and to clear clogged drains, especially when storms threaten. It has raised and in some cases eliminated subway grates, which were built to allow fresh air to flow down to dank underground spaces but which now look like holes to let more water in. In some places, the MTA constructed flood-proof doors, which can close when the water gets too close.

More generally, cities like New York can create more green infrastructure to help with their water problems—basically, less pavement and more dirt. You might, for instance, create roadside green spaces where water can percolate before moving into stormwater drains, removing trash and pollution in the process. Los Angeles has been doing this to catch rainwater. “This is a long-term thing,” says Horodniceanu. Retrofitting cities to deal with what’s coming, and what’s already come, will take gobs of one of the scarcest resources of all: much more funding.

As cities expand and change, fixing the infrastructure already there to incorporate new technologies and grow the capacity is a difficult task. How disruptive will the efforts be? How much will it cost? It could be much easier in the long run to anticipate these issues way ahead of time and proactively make changes rather than only act after a major issue is exposed.

Water is particularly destructive as much of modern life depends on the fact that water will be excluded from the system. Residences, businesses, mass transit, electronics must be dry to function well. If there is an overwhelming storm or a breach of the water defenses, water can quickly wreak havoc both in the short-term and long-term. Cities require a lot of things to go right to properly go about their business but water can quickly disrupt this operation.

The recent events in New York City and New Orleans also remind me of the planning that can go into highways and parking lots: they can be constructed with peak use in mind. The parking lot needs to be large enough to handle the biggest crowds, hence the shopping mall parking lots that can handle Thanksgiving weekend shopping but are not fully used throughout the rest of the year. Or, the highway that needs more and more lanes to handle rush hour traffic while there are many hours when that capacity is not needed. Sewers need to handle really big storms or events. But, in each case, can the largest need be forecast correctly? Adding lanes to roads can increase the traffic. Right-sizing parking lots can be tricky. And planning for the rare storm is hard, particularly if conditions are changing. Similarly, people will not be happy in these cases if there is not enough capacity and there will be calls to fix the problem afterward.

Building the ability to disperse billions in rental aid assistance in the US

Congress has allocated billions for rental aid assistance amid COVID-19 but it takes time and infrastructure to distribute it to American renters:

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With millions of Americans out of work due to the pandemic, the eviction moratorium helped keep people in their homes — but it also put a squeeze on landlords. To help, between the December and March COVID relief packages, Congress approved more than $46 billion in rental assistance. Exact amounts renters and landlords can receive depend on their income and where they live, but renters could get enough to cover rent from as far back as March 13, 2020, unpaid utilities and even, in some cases, future rent.

But by the end of May, only $1.5 billion had gone out. And officials are racing against the clock: The federal eviction moratorium ends July 31…

“While we have substantial funds through the American Rescue Plan, we as a nation have never had a national infrastructure to prevent unnecessary evictions,” White House American Rescue Plan Coordinator Gene Sperling said recently during an eviction prevention summit.

While there had been some state and local rental assistance programs, the scale of this program was beyond what they’d handled, a Treasury official said. State and local entities had to build IT systems and hire staff. Some programs did not even open until May or June — but since opening, a Treasury spokesperson said, there has been an exponential increase in renters getting money. Landlords and renters can apply directly for funds through their states, counties and in some cases tribal authorities depending on where they live.

Unprecedented times lead to unprecedented processes? Putting the money into the right hands in a timely manner is no easy task. The steps include:

-approving the monies and making it available

-letting people know that the money is available

-encouraging applications

-processing applications

-disbursing funds

-applying the funds to rent

-overseeing the program during the process and afterward

If it comes together, millions of Americans will be able to stay in their housing and landlords will rent they were waiting for.

Now, to tackle the broader issues of affordable housing in helpful locations…

The foresight of old railway viaducts

In regions like Chicagoland where there are numerous railroad lines and at-grade railroad crossings, old viaducts exhibit a measure of foresight that benefits today’s residents:

Google Street View image of Vollmer Road viaduct

That factory still operates as Chicago Heights Steel, and the cobblestone portion of Main Street is mostly a driveway leading to it. But just past the factory is a secret passageway of sorts, an ancient viaduct just wide enough to allow one vehicle to pass under the old Elgin, Joliet & Eastern railroad tracks…

There are areas, though, where there are no ways around it, and if you get stopped, you just have to abide. I’ve lived in those areas, but I don’t anymore. The main train line by me is above grade and it’s great. The old Illinois Central tracks, which include what’s now known as the Metra Electric District commuter line, traverse the area atop a big berm as unobstructed motorists cruise underneath through a series of viaducts from Sauk Trail all the way into the heart of Chicago.

According to Metra, the grade separation was a direct result of Chicago hosting the 1893 World’s Columbian Exhibition — city leaders didn’t want messy train deaths to tarnish the event’s image. In the years after those initial express trains from downtown to Jackson Park for the World’s Fair, commuter trains made their way to the suburbs, with Flossmoor getting service in 1900 and Matteson by 1912. The raised platforms, tracks and viaducts followed with the entire line being above grade by the 1920s…

Viaducts are harder to come by these days than they were in the golden age of railroads, and I only know of a few that have been constructed in my lifetime. Despite the hassles that can come along with them, motorists, and likely train engineers too, are happy we have the ones that are here.

Even as railroad lines help put many suburban communities on the map and still provide access to big cities, many local residents just see them as a hassle for the traffic and noise they create. With the automobile dominating suburban travel, trains are nuisance when they block vehicle flow.

I am familiar with numerous railroad viaducts in suburban communities in addition to the ones mentioned above in the south suburbs of Chicago. They were ahead of their time as they allowed access under the railroad tracks, sometimes even before cars were around. Local leaders and officials they foresaw the problems that might arise between ground-level traffic and trains and therefore separated the two flows to let each move on their own. This helps avoid safety issues that still plague communities today.

At the same time, not all of these viaducts have been treated well. As the article notes elsewhere, they can have drainage issues. Their original size is often an issue as today’s vehicles and/or traffic flow is larger, meaning that old viaducts need to be expanded. Letting one car through at a time is better than nothing but many communities would benefit from two lanes each way being able to go under the tracks. Foresight in infrastructure is helpful but it needs consistent attention to keep up with repairs and expanded suburban populations.

The language of “human infrastructure” versus human rights

President Joe Biden was in the Chicago suburbs yesterday and talked about his proposal for infrastructure improvements in the United States:

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President Joe Biden promised jobs and better access to education in an appeal that may resonate with suburban swing voters during a historic trip to McHenry County College.

“America is back,” Biden said Wednesday, promising to fund transportation through an infrastructure package that faces opposition in Congress…

During his remarks, the president touted the infrastructure program and the American Families Plan, which includes checks of up to $300 for eligible families starting this month.

“That’s good for families and is good for the economy and it will create more jobs,” said Biden, who repeated the word “jobs” several times during his speech.

Infrastructure often refers to physical structures operating in the background of society. Electricity, gas pipelines, power plants, roadways and mass transit lines. I would guess many people do not think about these much until there is a problem or it becomes very visible. As a recent example, I drove down a highway that had a pipeline pass over the roadway. While I know that pipelines are essential, I do not think about them much until I hear about them on the news (the recent pipeline ransomware, the Keystone Pipeline, etc.).

The Biden administration is pushing to include more human capital elements in its infrastructure plan. In terms of the essential pieces for society to function, jobs, health care, and other benefits are indeed important. Particularly in the era of the knowledge economy and more attention paid to inequality, including a more human element to infrastructure would hold some appeal.

At the same time, I wonder if the goals of the Biden administration fall more into the category of human rights. Should people have a right to a job, which provides income and worthwhile activity? Should there be a right to good affordable housing? A right to Internet access?

Perhaps the political calculation is that moving toward a conversation of human rights is a bridge too far. Americans have resisted the right to housing or public housing. But, call it infrastructure and housing is not guaranteed but rather an important foundation for society. On the other hand, electric lines and gas lines are essential for everyday living yet are they a right? Is the difference that infrastructure might require a cost while rights are supposed to be free or really cheap?

Given the current public conversations, this may be the way societies are headed: people should have more rights. Universal basic income might be the next area where this occurs: jobs are not enough and people should be able to have a guaranteed income source to have a decent life.

For now, American political leaders will debate exactly what infrastructure means. At the least, there will be acknowledgement that numerous building blocks of social life must be in place for desired outcomes.

The scale of American shipping illustrated in one broken-down semi with 14,000 chickens

Americans are used to highways, semi-trucks, and breakdowns. They might not be as familiar with what can be in some of the trucks that break down:

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Loucks, a mechanic at Super Truck Service in west suburban Addison, didn’t think anything of the call. But when he got to the semi, he found 14,000 live chickens in the trailer…

He couldn’t tow the truck the nearly 30 miles back to the shop because tipping the trailer up could be even more dangerous for the chickens, Loucks said, so his team chained up an axle and had the semi drive back to Super Truck Service on eight wheels instead of 10. That meant driving 35 to 40 mph down I-90, which wasn’t a very safe option either, Loucks said.

After returning to the shop at 562 S. Vista Ave. in Addison, and with the temperatures rising, Loucks said the first thing he did was grab a garden hose as he started to “water the chickens,” despite being afraid of birds.

Three things stand out to me in this short story that might be easy to ignore since vehicles break down all the time:

  1. The number of chickens on one truck is astounding. Ask people on the street how many chickens would fit on a truck and I wonder how many would be close to this number.
  2. While this is a large number of chickens, this is just one truck. Therefore, this is just a drop in the bucket in the number of chickens in the United States. According to Statista, there are over 1 billion chickens in the United States.
  3. There are numerous ways to ship goods and animals. Moving all of this requires a lot of infrastructure behind the scenes that helps get eggs and chicken to grocery shelves. Put #1 and #2 together and you need a lot of ways to transport everything.

The United States is a large country with a big economy and a critically important set of structures and vehicles that get things where they need to go. Semis and other trucks are needed to help make this possible.