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2014: A Landmark Year for Subsidy Accountability

January 14, 2015

Two-thousand fourteen was a banner year for our movement, hands down. The first move to require standardized subsidy-cost reporting! The first half of a legally-binding two-state cease fire deal! The first state ban on tax-break commissions! A big surge found in state disclosure of subsidies! Big improvements to our Subsidy Tracker, enabling first-ever mash-ups! And a governor apparently shamed to stop his partisan job piracy forays!

GASB Finally Weighs In: After a decades-long conspicuous absence, the Governmental Accounting Standards Board (GASB) announced in October that it would soon issue a draft standard to require states and localities to account for the revenue they lose to economic development tax breaks.

This is a truly tectonic event in the decades-long struggle to rein in corporate tax breaks. When states and localities start issuing the new data in 2017, we predict it will enable massive new bodies of analysis and policymaking: in state and local finance, tax policy, government transparency, economic development, regionalism and sprawl, public education finance, and campaign finance.

The day the Exposure Draft was published on October 31, we swung into action, issuing a critique of it, speaking on two webinars and answering many queries. We are posting exemplary comments here.  If you haven’t filed a comment with GASB yet, the deadline is January 30. Contact us ASAP if you need help.

FASB Enters the Debate, Too! In late December, GASB’s sister group, the Financial Accounting Standards Board (FASB), which effectively regulates private-sector bookkeeping, revealed that it too is debating whether and how to require disclosure of state and local tax breaks by the recipient corporations. The FASB process is well behind that of GASB, but this is equally tectonic.  See “Disclosures by Business Entities about Government Assistance.”

Missouri Enacts Half of a Bi-State Cease-Fire: In July, Missouri’s “red” legislature and “blue” governor agreed on legislation that is the first time a state has enacted a legally binding half of a two-state “cease fire” in the economic war among the states. Kansas has until July 2016 to reciprocate: the ball is in your court, Gov. Sam Brownback!  Credit for this victory belongs to a group of 17 Kansas City-area businesses, led by Hallmark, who went public in 2011.

Disclosure Found in 47 States plus DC: In January, we issued our latest 50-state “report card” study on state transparency of company-specific subsidy data. We found that only three states—get with it, Delaware, Idaho and Kansas!—are still failing to disclose online (more than double the 23 states we found disclosing in 2007). But we also found that reporting of actual jobs created and actual wages paid is still lagging: only one in four major state subsidy programs discloses actual job-creation outcomes and only one in eleven reports wages.

First-Ever Ban on Tax-Break Consultant Commissions: In September, California became the first state to ever ban consultant commissions on an economic development tax break. It’s a reform we have long called for and would become commonplace if states registered and regulated tax-break consultants as lobbyists.

Subsidy Tracker “2.0” Upgrade: In February, we unveiled a massive upgrade to Subsidy Tracker, linking more than 30,000 subsidy awards to their ultimate corporate parents and issuing “Subsidizing the Corporate One Percent,” showing that just 965 companies have received three-fourths of recorded subsidy dollars. Later in the year, we mashed up Tracker data with the Forbes 400 and with low-wage employers to reveal more than $21 billion in subsidies fueling economic inequality.

Perry Quits Partisan Job Piracy: 2014 was also notable for what didn’t happen. After our September 2013 study chastising Texas Gov. Rick Perry for making interstate job piracy a partisan sport and for issuing deceptive disclaimers about who funded his highly publicized trips to six states with Democratic governors (Texas taxpayers are footing part of the bill)—and a follow-up blog basically daring him to do it again—he never did, and will leave office January 20th.

Truth in TIF Taxation: In July, Cook County, Illinois started showing property taxpayers how much (in both dollars and percent) of their taxes are going to tax increment financing (TIF) districts, the largest jurisdiction known to be doing that in the U.S.

Property Tax Losses Revealed: In studies covering Chicago and Memphis, we revealed that property tax losses—either to TIF in Chicago or PILOTs in Memphis—are costing enormous sums that could be meeting other needs: 1/10th and 1/7th, respectively, of their entire property tax bases. The studies helped block a tax hike in Chicago and changed the debate in Memphis.

Privatization Slowed: Only one more state privatized its economic development agency: North Carolina. After our October 2013 study, Creating Scandals Instead of Jobs, documenting scandals nationwide, provoked editorials in three of the Tarheel State’s leading newspapers, Gov. Robert McCrory’s plans to fast-track a new privatized entity were slowed. It was later created, but with many of the safeguards we recommend if a state chooses such a structure.

Transit Investments as Economic Development Done Right: In case studies in St. Paul and Normal, Illinois, we documented the broad job-creation benefits for more than a dozen Building Trades crafts when transportation investments build transit hubs that spur massive new transit-oriented development. We even gave cautious approval to Normal’s use of a related TIF district.

It was also the year Tesla ran a five-state public auction for a battery plant. Kudos to the Progressive Leadership Alliance of Nevada, California Budget Project, Southwest Organizing project in New Mexico, Arizona PIRG and Texans for Public Justice who staged a high-profile outcry with us, calling out Tesla for its Old Economy whipsawing behavior. Ultimately, Nevada overspent for the trophy deal at $1.3 billion and will go down in history as the birthplace of what we dubbed the “tax credit capture zone,” a new benchmark for tax-break greed.

Almost a Record Year for “Megadeals.” As we found in an update of our “Megadeals” study and entries in our Subsidy Tracker database: we now have 298 such deals documented over $60 million and some over $1 billion. Only 2013, with its record Boeing megadeal of $8.7 billion, cost more than 2014.

Finally, 2014 was the year we said goodbye to Bettina Damiani after her stunning 13-year streak of achievements at Good Jobs New York: the best local disclosure law in the country (won in 2005 and later improved); an online database of >41,000 deals; a radical overhaul of the process by which the NYC IDA relates to the public (enabling project interventions from diverse grassroots groups); $11 million in improper rent deductions disgorged by the New York Yankees; a racetrack defeated on Staten Island wetlands; and assistance to hundreds of community groups, unions, environmentalists and journalists challenging the status quo. One of Bettina’s tangible legacies: the space for new mayor Bill de Blasio to do things like saying no to JP Morgan Chase’s demand for $1 billion to move across Manhattan (with our database documenting its huge past subsidies and job shortfalls).

If you like what we do, please support Good Jobs First: we have a lot in the works for 2015, too!

Posted in California, Corporate relocations, GASB, Job Piracy, Kansas, Missouri, New York, Privatized Economic Development Agency, Property Taxes, Smart Growth, Subsidies, Subsidy Tracker, Tax Credits, Texas, Transit, war among the states, Yankee Stadium | Leave a Comment »

Bosses for Buses

May 29, 2013

For Release Wednesday, May 29, 2013
Contact: Greg LeRoy 202-232-1616 x 211

“Bosses for Buses”
Study: Employer Support for Transit is Surging Locally but Fractured Nationally

Washington, DC—American employers are organizing and winning better public transportation in many metro areas. Major employers such as universities and hospitals and coalitions of businesses help explain why state and local ballot initiatives for transit consistently win more than 70 percent of the time.

Yet at the national level, there is not a unified corporate voice for transit; this has been especially evident during three recent federal debates that affected this vital public service. Instead, there are disparate voices speaking only to selected aspects of transit.

Local business coalitions—united by geography—are mostly powered by companies that depend on transit, whereas national advocacy is dominated by companies that make a business selling to transit agencies. As well, there are competing priorities within public transportation circles, such capital budgets versus operating funds.

Those are the key conclusions in a major study released today by Good Jobs First cataloging the many kinds of businesses that support public transit and the diverse ways they express that support. “Bosses for Buses” is believed to be the most wide-ranging study ever published on the subject; it was released at a national tele-press conference and is available at http://www.goodjobsfirst.org/bossesforbuses.

“The remarkable local support for transit demonstrated by so many employers is truly heartening,” said Greg LeRoy, executive director of Good Jobs First and lead author of the study. “But the lack of a unified corporate voice on federal transit issues is equally disheartening. It begs the big-picture question: when will the growing corporate consensus for transit outside the Beltway translate into stronger action inside the Beltway?”

The study finds most promising the formation and growth of business-led groups in specific metropolitan areas,  as well as some outstanding individual large employers—often “eds and meds,” or universities and hospitals. And every day, tens of thousands of employers subsidize transit use—or facilitate the use of pre-tax income for monthly transit fare cards or commuter van pools.

At the national level, many businesses that sell goods and services to transit agencies belong to the American Public Transportation Association (APTA), the voice of big-city transit agencies. The study also describes how employers participate within the Community Transportation Association of America, the Association for Commuter Transportation, and Best Workplaces for Commuters.

Aspects of the 2009 federal stimulus, the belated 2012 reauthorization of the surface transportation act, and the big January 2013 federal income tax compromise all bore upon transit, yet none drew a unified corporate voice for transit service. Nor has there been corporate support for federal aid to shield transit operations from the catastrophic national wave of service cuts, fare hikes and route abandonments seen since 2008.

The study profiles outstanding networks and companies:

  • Washington University in St. Louis, which has anchored Citizens for Modern Transportation, a winning coalition, and has long promoted and subsidized transit use by its workforce and student body;
  • Cleveland Clinic and University Hospitals of Cleveland, the city’s two largest employers, which led the successful campaign for the HealthLine, one of the nation’s most successful Bus Rapid Transit (BRT) lines;
  • Friends of Transit in the Phoenix metropolitan area, a winning spinoff of the Greater Phoenix Chamber of Commerce, with its “Transit Means Business” campaign grooming the next generation of business leaders for transit;
  • The Baton Rouge General Medical Center, which joined with other employers and a faith-based community group to win a 2012 ballot initiative that will over time double the amount of bus service there;
  • Amalgamated Transit Union Local 726 on Staten Island, New York City, which organized riders and businesses to win dedicated bridge bus lanes, larger buses, and a fare cut that more than doubled ridership;
  • Move LA, a large business, labor and environmental coalition that has won legislation that will nearly double the size of Los Angeles County’s fixed-guideway transit system;
  • Ameriprise Financial, an investment services firm in Minneapolis that was the biggest early supporter of Metropass, enrolling 47 percent of its 6,000 downtown employees in the program’s first month;
  • Purple Line Now!, a business-backed coalition that is now winning a sorely needed arc-shaped light rail line connecting inner-ring suburbs and four subway “spokes” in the Maryland counties that straddle Washington, DC;
  • Transportation Management Association of Lake-Cook, a longstanding transportation demand management project with “Shuttle Bug” service linking corporate office parks and campuses north of Chicago with transit;
  • McCaffery Interests, a Chicago-based integrated development firm that specializes in large, mixed-use transit-oriented development (TOD) projects;
  • United Streetcar of Clackamas, Oregon, rebirthing the long-lost streetcar manufacturing industry in the United States with good union jobs and high domestic U.S. content; and
  • “Third-party administrators” such as WageWorks and Edenred that manage the business of collecting pre-tax income and providing monthly transit pass cards. This obscure niche industry has recently undergone a great deal of consolidation, and with the Association for Commuter Transportation, it advocates to ensure that federal tax benefits for transit are at parity with those for parking.

In sum, the study finds corporate support for transit in America to be remarkably broad and diverse, but also highly fragmented. Just when market forces and energy policy beg for a unified national employer voice for growing and improving transit service, what we find instead are disparate voices speaking only to selected transit issues.

“Public transit is far too important to be left only to those companies that make their business selling to transit agencies,” concluded LeRoy. “Far more numerous—and deserving to be heard—are those employers that depend on transit for their workforces. When will they organize nationally?”

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Americans for Transit

June 14, 2012

Responding to the nation’s public transportation crisis, the Amalgamated Transit Union (ATU) and Good Jobs First (GJF) announced today the launch of Americans for Transit (A4T), a new non-profit to create, strengthen and unite grassroots transit rider groups.  They also announced Andrew Austin as A4T’s founding executive director.

Ridership on buses, trains, and ferries is skyrocketing with Americans taking 10.4 billion rides in 2011 – the highest number in decades.  But due to the recession, 85 percent of transit agencies have had to cut routes, borrow money and/or increase fares just to keep running.

“Transit is a major social justice issue of our day,” stated Larry Hanley, ATU International President and Chair of the A4T board. “Ridership is the highest in decades, but riders have suffered the worst wave of fare hikes and service cuts in post-war history. These are tax hikes imposed on the working poor, plain and simple. Americans need better, affordable transit service. The ATU and Americans for Transit will work to make that happen by organizing more riders, workers and advocates to fight for public transit.”

“Andrew Austin stood out because of his terrific track record as field director of the Transportation Choices Coalition in Washington State,”  said Greg LeRoy, GJF executive director and A4T secretary-treasurer. “He values local community organizing, is savvy with social media, and has a sophisticated grasp of transit policy.”

Americans for Transit is the latest response by ATU and GJF to the nation’s transit crisis. Since Hanley’s election in the fall of 2010, the two organizations have staged two community-labor “boot camps” training grassroots groups and local union leaders in 95 cities how to organize riders, and published Transit Rider Organizing: A How-To Manual that compiles eight case studies of winning campaigns, catalogs best practices, and provides the first-ever national directory of grassroots rider groups.

“Despite federal gridlock on the surface transportation act, at the state and local level Americans continue to show terrific support for transit,” said Austin. “Recent votes in Louisiana and Wisconsin prove again that Americans believe transit is critical for a healthy environment, a strong economy, and fairness to the working poor, seniors, students and the disabled.”

For more information stay tuned to Americansfortransit.org, which will be live soon, and follow us on facebook at facebook.com/AmericansForTransit.

The Amalgamated Transit Union is the largest labor organization representing transit workers in the United States and Canada. Founded in 1892, the ATU today is comprised of over 190,000 members in 264 local unions spread across 44 states and nine provinces.

Good Jobs First is a nationally recognized resource center promoting accountability in economic development and smart growth for working families.  Click here to read the Transit Rider Organizing Manual online.

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Manual for Organizing Transit Riders Features Creative Community Victories

December 22, 2011

Good Jobs First today published a grassroots organizing manual for riders of public transportation seeking to preserve and improve transit service.

“Organizing Transit Riders: A How-To Manual” is a 64-page resource guide that includes six case studies of successful transit-funding campaigns plus interviews with the nation’s two oldest transit advocacy groups, the NYPIRG Straphangers Campaign in New York and the Bus Riders Union in Los Angeles.

The manual was funded by the Rockefeller Foundation and is freely available at www.goodjobsfirst.org.

“This manual draws upon two community-labor ‘boot camps’ we staged with the Amalgamated Transit Union,” said Greg LeRoy, director of Good Jobs First and primary author of the manual. “In recruiting to the boot camps, we found a motley rainbow of community groups organizing transit riders. Most had never met before and they shared terrific stories.”

“We applaud Good Jobs First for issuing this manual,” said Lawrence Hanley, International President of the Amalgamated Transit Union, the nation’s largest union of transit workers. “Transit riders deserve a greater voice and rider organizing is critical to stemming the national tide of service cuts and fare hikes that are actually tax hikes on the working poor.”

The manual’s case studies feature exciting campaigns in the Twin Cities and Denver metro areas, Spokane and King County in Washington state, St. Louis County, and Toronto, Canada. The case studies are written by the community organizers who orchestrated the campaigns. The manual also includes an annotated set of links to other campaign resources, a series of constituency-recruitment checklists, a summary of common elements of successful campaigns, and a directory of every known grassroots group organizing transit riders in the U.S.

Good Jobs First is a non-profit, non-partisan resource center promoting accountability in economic development and smart growth for working families. It has published studies for 11 years looking at economic development subsidies and the geographic sprawl of jobs, job access via transit, organized labor’s role in smart growth, and transit-oriented development.

Posted in Transit | 1 Comment »

Bondholders of Yankee Stadium Garage Bonds Get Extra Innings

March 25, 2011

The April 1 deadline for the Bronx Parking Development Corporation to get its act together is no prank. Thanks to a glut of parking space at the new – subsidized to the hilt – Yankee Stadium, the parking garages, also subsidized to the hilt, have gone so unused the owners are struggling to pay its bondholders. It was widely reported that the $237 million in private activity bonds to finance the garage were going to default at the end of next week. However, today Juan Gonzalez at the Daily News reports that directors at the firm agreed to dip into its debt reserves (again) to pay the bondholders as well changes to its operations, like getting approval for expenses from an appointee chosen by the bondholders.
 
We can’t say New Yorkers didn’t see this coming.

(more…)

Posted in New York, Stadiums, Subsidies, Tax-Exempt Bonds, Transit, Yankee Stadium | Leave a Comment »

The Recovery Act: The Transparency Gift that Keeps on Giving

February 18, 2011

Largely lost in the partisan bickering over the stimulus has been the law’s enormous positive impact on improving government transparency. The American Recovery and Reinvestment Act of 2009 (ARRA) is not just the most transparent federal spending bill in U.S. history—the changes it pioneered will endure even after the stimulus winds down.

By now, many curious Americans have explored spending and job-creation on ARRA projects in their communities at recovery.gov. About 35 percent of ARRA funding is revealed there: every grant, loan and contract. And the reporting extends beyond the primary recipient one level down to sub-recipients. But few people noticed that the Office of Management and Budget applied that extended reporting to the main federal disclosure website USAspending.gov (created thanks to a bill championed by then-Senator Obama).

Even fewer people noticed that the quality of ARRA data improved greatly in October 2010: we can now trace the money as it changes hands three times, instead of two, to sub-sub-recipients. For people concerned about companies tied to political contributions, offshoring of jobs, violations of workplace laws, etc., this deeper data is a potential gold mine for accountability.

In a little-noticed provision, the Recovery Act also required privately-held companies that do a large share of their business with the federal government to reveal the compensation of their five highest-paid executives. We blogged about this when the first round of data came out, revealing executive pay at the high-profile “Beltway Bandit” consulting firm Booz Allen Hamilton.

The Recovery Act has also enabled a side-by-side analysis of transportation spending—comparing job creation from highway-building versus public transportation—that was simply not possible before: apples-to-apples data did not exist. However, in early 2010 Smart Growth America, the United States Public Interest Research Group and the Center for Neighborhood Technology issued “What We Learned from the Stimulus,” finding that transit construction creates 84 percent more work-months than does highway-building. That reinforced our own 2003 finding, in “The Jobs Are Back in Town” that smart growth creates more work for Building Trades union members than does sprawl.

ARRA data and the mapping functions at recovery.gov have also encouraged more people to think about the geographic distribution of government spending (one of our pet peeves here at Good Jobs First). For example, the Voices of California Coalition examined ARRA spending by local jurisdiction and found many hard-hit communities getting little if any dollars and jobs.

In New York City, Community Voices Heard coupled ARRA jobs data along with data from the local public housing authority and its own door-to-door survey work to prove that, despite HUD Section 3 rules intended to ensure that public housing residents get job opportunities when their residences are rehabilitated, very few ARRA-funded jobs went to New York City Housing Authority residents. See “Bad Arithmetic.”

In Texas, the Center for Public Policy Priorities reported on that state’s performance on weatherization spending and Policy Matters Ohio mapped where clean energy jobs were created, finding they were “well targeted to areas of economic distress.”

Finally, we here at Good Jobs First have closely monitored how state governments have mirrored Uncle Sam’s ARRA transparency boost, publishing two “report card” studies on state government Recovery Act websites. Every single state put up such a website—even though they had no legal obligation to do so!

Of course, the states did have more obligations than anyone else to provide ARRA jobs data, since so much of the money flows through state agencies, making them primary recipients. So it was no exaggeration to call ARRA “a giant crash course on disclosure for state governments.” And lo and behold, in December 2010 when we revisited the issue of how well state governments disclose their own spending for job creation, we found the number of states naming names online had jumped from 24 to 37.

Posted in Climate Issues, Disclosure, Economic Recovery, Federal Job Subsidies, Green Jobs, Jobs, Smart Growth, Transit | 1 Comment »

NYC “Wins” JetBlue Headquarters

March 29, 2010

Last week the airline JetBlue declared New York City the winner in a relocation contest against Orlando, Florida. The airline said it will move 880 employees from its current headquarters in Forest Hills, Queens to Long Island City, also in the borough.

The announcement however, seems premature as a public hearing – a necessary step in securing some of the subsidies – hasn’t been scheduled. This makes us wonder, how rock solid is this deal? And remarkably absent from the Mayor’s press release is any mention of the total value of the subsidies the airline anticipates; Good Jobs New York has learned it is approximately $30 million. In addition to retaining its current jobs, JetBlue is expected to transfer 70 jobs from Connecticut and expand its staff by 130 at its new location, the Brewster Building (the location of an ill-fated subsidy deal). Included in the subsidy deal is the right for JetBlue planes to bear the iconic I (heart) NY logo.

This proposal conjures up ghosts of corporate retention deals past:

  • No public hearing announcement.
  • Minimal details: No Memorandum of Understanding between the airline and the city detailing the proposal has been made public. Did the city conduct a cost/benefit analysis showing that these incentives are a wise investment?   If so, how will the city ensure that the company creates and retains the jobs it promised? JetBlue officials report it conducted an “exhaustive” study that led the company to make its location decision, will the airline make that study public?
  • Previous tax-payer investment: The airline already benefits from tax-free bonds that helped build its impressive new terminal at JFK airport and is one of the busiest carriers there.  JetBlue is also benefiting from the upgrade to one of JFK runways (financed by the Port Authority, Federal Aviation Administration and funds from the American Recovery and Reinvestment Act) and is expected ease its notorious delays and improving service for the airline.

If there’s an upshot, it is that the Bloomberg Administration changed the game, albeit slightly from the days of Mayor Giuliani, by incorporating job creation rather than just retention into subsidy deals. Yet, it has been less than stellar in holding large companies accountable – Pfizer and Metropolitan Life Insurance, for example – and in leveraging subsidies for new jobs at the new Yankee Stadium.  

The ability to make this deal transparent and accountable is up to the Mayor. There’s still time, and it seems even some of those on Wall Street are looking for some answers.

Posted in Jobs, New York, Subsidies, Taxes, Transit | 1 Comment »

Struggling Chicago finds $25 million for United Airlines

September 3, 2009

Last month, the City of Chicago offered a substantial tax increment finance (TIF) subsidy of $25 million to an ailing United Airlines (UAL) if it promised to relocate its operations center to the Willis Tower (formerly the Sears Tower). Use of TIF as a relocation incentive is problematic given net new jobs are not being created and TIF is intended to help revitalize downtrodden areas, not encourage occupancy in skyscrapers.

The TIF subsidy encourages UAL to leave its current operations center next door to Chicago’s O’Hare Airport, shifting commutation patterns for 2,800 employees –employees who probably use airport facilities.  The operations center used to house UAL’s headquarters between 1961 and 2006 until the city gave tax breaks and incentives to UAL for a new office in the Loop. Why would an airline relocate its operations center 19 miles away from the world’s 4th busiest airport?

Historically, Chicago and outlying suburbs use incentives in controversial ways. In 1989, Sears, Roebuck & Co. announced that it was seeking to relocate from the Sears Tower to cut costs (see page 36 of our 2003 report, A Better Deal for Illinois). The State of Illinois feared losing $411 million in income taxes (from 5,400 jobs) and 2,200 ripple-effect jobs if they left Illinois. An affluent suburb 29 miles northwest of the Loop put together what was the largest subsidy package ever in Illinois history at $178 million. The state not only chipped in but expanded the definition of ‘blight’ in Illinois’ TIF law so that the wealthy suburb could buy 786 acres of land with TIF bonds to be repaid out of Sears’ property taxes.

Although Sears promised to make up shortfalls in the property tax revenues (and did in 1998 and 2001), missing was a clawback relating to the 5,400 jobs which the state based its incentive rationale on from the get-go. Sears never approached the original employment number, which begs the question: did it move out of necessity or to avoid paying for mass layoffs and the negative media attention?

The City of Chicago is in a pinch. Two recent winters have threatened the city’s budget to the brink of collapse and forced the mayor to lease the city’s parking meters to a private entity for 75 years. Despite city coffers in ruin, TIF funds overflow. A new report by the Chicago Coalition for the Homeless shows TIF-funded units are disproportionately sold or rented to high-income households. Recent investigations indicate that TIF dollars are awarded on dubious basis in lieu of need in a city full of questionable zoning practices. Moreover, a recent $10.4 million TIF deal fell through, leaving the city without the jobs it paid for. Despite this, the city resists passing TIF sunshine laws.

Chicago’s 158 TIF districts covering 30 percent of the city are diverting revenues that would otherwise keep schools solvent, plow streets, maintain public transit, and fix potholes. TIF has strayed from revitalizing distressed communities and is instead being used to shuffle tax base across the region. Moving jobs does not create new jobs. TIF reform is long overdue in Illinois.

Posted in Clawbacks, Disclosure, Financial Crisis, Illinois, Job Piracy, Jobs, Property Taxes, Subsidies, Tax Increment Financing, Taxes, Transit | 4 Comments »

Can Slowdown in the Chicago Suburbs Lead to Smarter Growth?

October 23, 2008

Chicago-area advocates of more sensible growth and land-use policies got a boost this week when Chicago Tribune columnist John McCarron urged the region’s public officials to see one upside of the painful economic crisis: a chance to put the region’s “suburban sprawl machine” into reverse.

McCarron, an expert on urban affairs and state and local fiscal policy, cited problems in previously booming Chicago exurbs, where higher gas prices have made long commutes painfully expensive, and where affordable housing and public transit are limited or non-existent. He called on the region’s public officials to rethink the “anything goes” development and land use policies that have led to massive traffic congestion, high commuting costs, “monster” mortgage payments, and the loss of agricultural land.

The editorial described the redevelopment of an old naval air station in suburban Glenview as an example of more rational, energy-efficient and compact suburban development based on accessible public transit. A recent report by Chicago Metropolis 2020, a business-oriented civic policy group, predicts that seniors and low-income immigrants (two groups leading the region’s population growth) will demand more such compact and transit-rich communities, as well as more affordable housing.

Even if the recession limits some smart growth investments, McCarron believes local governments can still require private developers to take common sense steps to increase energy efficiency, transit access, and the number of pedestrian walkways.

Besides McCarron’s suggestions, other smart growth measures, affordable even in a recession, include promoting the state’s little used “business location efficiency” incentive, which provides a moderately larger corporate income tax credit to companies locating near affordable housing and public transit. McCarron is certainly right to urge Illinois officials to respond to a bad economy with policies that both promote more sustainable development and save taxpayer dollars.

Posted in Financial Crisis, Illinois, Smart Growth, Sprawl, Transit | Leave a Comment »

The Golden State Goes Greener

September 5, 2008

In California, an historic effort to reduce greenhouse gas emissions from passenger vehicles by curbing sprawl will likely soon become law. Senate Bill No. 375 would compel local planning agencies to make planning choices that reduce vehicle miles traveled between residential areas and employment centers. The bill has passed both the California Assembly and Senate and currently awaits Governor Schwarzenegger’s approval. He is expected to sign.

SB 375 provides a mechanism for reducing greenhouse gas emissions by the single largest producer, cars and light trucks. The bill’s broad coalition of supporters maintains that changes in land use and transportation policy must be made to achieve the state’s emissions reduction goals. To this end, SB 375 provides the California Air Resources Board (CARB), charged with reducing greenhouse gas emissions, with the authority to coordinate their efforts with metropolitan area transportation and land use planning.

The bill mandates that metropolitan planning organizations (MPOs) include sustainability strategies in their community growth and transportation plans. It integrates housing, transportation, and climate change policies for all 17 MPOs in the state. The bill’s basics:

• Transportation planning: CARB will set regional greenhouse gas reduction targets in consultation with local governments. Those targets will be incorporated into each region’s long-term regional transportation plan.
• Housing planning: Each region’s Regional Housing Needs Assessment (RHNA) – the mandated process by which local jurisdictions address their fair share of regional housing needs – will be adjusted to become aligned with the land use plan in each region’s regional transportation plan. This adjustment will result in a “fair share” redistribution in which municipalities growing more jobs must also provide for a larger share of housing and is inclusive of affordable housing near municipalities with strong job growth.
• California Environmental Quality Act reform: Environmental review will create incentives to implement the strategy, especially for transit priority projects.
• Green strings: SB 375 offers local governments regulatory and other incentives to encourage more compact new development and transportation alternatives. Local governments found to be in noncompliance with the new plans will be ineligible for state and federal funding.

In one efficient stroke, S.B. 375 mandates regional cooperation in several major policy areas. It compels regional governments to take steps toward correcting jobs-housing imbalances. It positions affordable housing near central business districts. Finally, it coordinates a shared responsibility strategy for greenhouse gas emissions reductions. Let’s hope that the passage of this legislation will serve as an example to other states seeking to rectify the host of problems caused by sprawling growth.

Posted in Climate Issues, Smart Growth, Sprawl, Subsidies, Transit | Leave a Comment »

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