Amid the largest economic shock in generations, public officials and private investors need to understand how the economic fallout is playing out locally to make informed decisions about investments, policies, and resources required to best position cities for future recovery and growth. HR&A recently assisted Rochester’s Destination Medical Center (DMC) – a public-private partnership that includes the City of Rochester, the Mayo Clinic, and the State of Minnesota – as it updated its 20-year economic development plan to integrate post-pandemic economic projections into its investment strategy.
The DMC’s 20-year plan spells out critical planning and investment decisions in Downtown Rochester, including demand for housing, office, hotel, retail, and other uses – this makes understanding the pace and nature of recovery central to decision-making. To guide planning, HR&A first contextualized how the economic shock in downtown Rochester has compared with national trends based on its unique drivers of activity, including medical tourism and R&D, and then projected economic recovery scenarios informed by precedent pandemics and how public health measures are likely to impact those activity drivers. These projections are being used to inform economic policies and investments in the years ahead.
See HR&A’s detailed analysis of recovery scenarios here
See HR&A’s Analysis and the full DMC plan here
As climate events increase in intensity and frequency, where communities can live and flourish is shifting. Individuals and communities are and will continue to be forced to move. In response, community resettlement must be considered a viable adaptation strategy and incorporated into planning processes and programs.
HR&A Partner Phillip Kash and Analyst Hannah Glosser teamed up with CSRS to offer ten principles to guide program design as cities face the new realities of extreme weather risks.
Read the full report here.
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How is the Thanksgiving meal like a Just & Resilient Recovery? The last eight months have reminded us how interrelated all aspects of urban life are – public health and economic security, open space and democracy. As we continue to work toward a new normal that is more equitable than the last, our strategies more closely resemble a potluck spread than any single course. Click through the images below for a recap of some of our Just and Resilient Recovery thinking to date. Happy Thanksgiving!
Image by Santo Jacobsson. Santo is an illustrator based in NYC and Minneapolis. His main work is multicultural and explores duality. Find more at santojacobsson.myportfolio.com and his Instagram: @santo.jacobsson.
Looking for a recipe for a real side dish in your meal, check out Nova Jacobson’s Sausage Stuffing, courtesy of Candace Damon, and the Morine family Spoonbread with Leftover Turkey recipe from Madison Morine!
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| A JUST & RESILIENT RECOVERY What the meal is built around |
HOUSING SECURITY Safe and warm |
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| SMALL BUSINESS RECOVERY Shop local |
EQUITABLE INVESTMENT Enough to go around |
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| FUTURE OF WORK Live, work, play |
WORKFORCE OPPORTUNITY Our daily bread |
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| OPEN SPACE Picnic in the park |
RACIAL JUSTICE A celebration of herstory |
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| UNIVERSAL BROADBAND Zooming into digital inclusion |
FOOD SECURITY A healthy side |
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| CIVIC PARTICIPATION Making Thanksgiving our own |
TRANSIT INVESTMENT Pulls everything together |
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| DATA INTELLIGENCE Everyone deserves a slice |
BANKING REFORM Keeping all cups full |
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| PUBLIC HEALTH Protect and respect |
CLIMATE RESILIENCE Water, water everywhere |
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| REGIONAL PARTNERSHIP Connecting urban and non-urban |
COMMUNITY ADVOCACY Bringing home the bacon |
The following policy proposal is based on a workshop conducted in September 2020 with: Mason Ailstock (HR&A), Scott Andes (Carnegie Mellon University), Deborah Crawford (University of Tennessee), Bob Geolas (HR&A), Will Germain (Ventas), Bruce Katz (New Localism), Julie Wagner (Global Institute on Innovation Districts), and Kate Wittels (HR&A Advisors).
Read the Full Report Here
Following a challenging election season, the Biden-Harris transition team is now drawing up plans for their policy agenda. Their task is hardly enviable. As we enter 2021, the United States faces four epochal crises: a public health emergency, an economic downturn, climate change, and a reckoning with systemic racism. Addressing these challenges will require a new approach to investing in our communities that stimulates more diverse economic growth, promotes social equity, and taps into knowledge creation that solves, rather than compounds, our twin health and environmental crises.
Federal investment in innovation districts provides a significant opportunity to address these challenges. The antithesis of monocultural research parks, innovation districts combine academic institutions, corporate R&D, startups, and entrepreneurial support organizations in mixed-use neighborhoods that promote creativity and collaboration, often in service of urgent societal challenges. Decades of research now demonstrates that the innovation economy thrives best in porous, multisectoral settings. By leveraging geographic proximity in its allocation of research funds, the federal government can thus dramatically amplify the impact of its R&D dollars. Similarly, by linking educational and workforce programs in low- and moderate-income neighborhoods to nearby innovation districts, the federal government can create a more sustainable economic engine for communities that are currently disconnected from the knowledge economy. Finally, by embracing its role in supporting regional innovation ecosystems, the federal government can reshape the country’s economic geography on a more equitable basis, creating new opportunities for job growth and investment in the nation’s heartland.
To support the growth of innovation districts, federal policymakers must focus on three interlocking policy domains. First, investments in district development will provide the dense physical environments necessary for innovation economies to thrive. Second, investments in talent development will cultivate the expertise needed to drive cutting-edge research and diversify the talent pipeline of local workers and students. Third, investments in research and development will supercharge local and national competitiveness by channeling federal R&D spending to specific innovation geographies.
Building on recent Senate proposals, including the Endless Frontier Act and the Innovation Centers Acceleration Act, there are a number of important actions that the federal government should take.
District Development
The federal government should support the growth of innovation districts in communities throughout the nation by:
- Creating a federal Innovation Zone (IZ) program that funds programmatic and physical investments in districts with emergent innovation ecosystems that, barring federal support, would be unable to capitalize on these latent knowledge economy assets.
- Seeking competitive proposals from local consortia bridging private industry, higher education, and local government.
- Awarding funds to innovation districts that are distributed throughout the country, with an emphasis on supporting places that have yet to emerge as innovation hubs.
Talent Development
The federal government should support the upskilling and reskilling of the nation’s workforce by:
- Supporting the education and recruitment of diverse research and entrepreneurial talent in high-tech fields relevant to specific IZs.
- Requiring co-location of educational and vocational facilities within IZs to facilitate job placement and access to the innovation ecosystem across the skills spectrum and enhance connections to adjacent low- and moderate-income neighborhoods.
- Funding the training of a diverse and resilient labor force with STEM skills through targeted partnerships with community colleges, four-year colleges, workforce investment boards, and the K-12 system.
Research & Development
The federal government should enhance domestic R&D activity by:
- Targeting R&D funding to universities and businesses within specific IZs and incentivizing partnerships between companies, educational institutions, federal research entities, and state and local governments.
- Encouraging commercialization within university settings by amending grantmaking criteria to incentivize applied research and restructuring Technology Transfer Offices into loss-leading, third-party entities operated independently from university administrations.
- Providing seed funding for the creation of IZ-specific venture capital funds that can increase access to financing for new companies.
With a new presidential administration preparing to take office – and the country facing a cascading set of crises – now is the time for the federal government to invest in the growth of innovation districts, particularly in regions that have yet to benefit from the new economy. With a thoughtful and intentional re-alignment of federal policies supporting innovation and economic development, place-based investments in infrastructure, talent, and R&D can leverage the power of proximity to supercharge American innovation and in so doing lay a foundation for a new and more inclusive era of prosperity.
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As we tally the results of our #UrbanismOnTheBallot roundup, we’re also looking forward to this year’s Talking Transition programs in communities that are ushering in new leadership.
The time between Election Night and the first 100 days of an administration presents an opportunity to restore the strength of democracy at the local level – to foster community-driven policymaking that creates the change residents and businesses want. Talking Transition is a program that helps newly elected leaders engage with the communities they represent during this critical moment to shape a more just and resilient administration.
In Harris County, TX, the third most populous in the country, Talking Transition helped connect the new administration to more than 200 community-based organizations. In New York City, the program helped elevate housing affordability to a top administration priority through civic engagement that reached 50,000+ New Yorkers in less than 2 weeks. In Baltimore, an HR&A program modeled on Talking Transition engaged 5 community organizations and trained over 30 Community Data Fellows who led data collection and analysis efforts to ensure equitable data control.
Do you know a newly elected leader who would benefit from this type of inclusion that translates new ideas into meaningful action? Let us know!
Our team of experts follow up and discuss which local ballot measures passed, which failed, and most importantly, why? It’s the #UrbanismOnTheBallot follow up!
| Affordable Housing | Transit |
| Open Space | Equitable Budgeting |
| Digital Inclusion | Tax Responses to Crisis |
AFFORDABLE HOUSING
More local funding for affordable housing
By HR&A Partner Phillip Kash
All of the affordable housing bonds we were tracking passed by healthy margins, with the exception of San Diego‘s where a majority of voters supported the bond (57%) but 2/3 support is needed for passage. The bonds were all for relatively modest amounts:
- Raleigh $80 Million
- Charlotte $50 Million (another $50 million was approved in 2018)
- Denver $40 Million for homelessness
- Baltimore $12 Million
The smaller bond sizes should be more manageable for cities to deploy quickly – an issue that has plagued larger bonds like LA’s 2016 Bond, which have struggled to turn funding into housing at the scale promised and needed. On the other hand, these smaller bonds may be insufficient to make a difference even if they are deployed. This concern is already being raised in Raleigh just days after the City passed its largest housing bond ever.
Voters delivered mixed messages on housing affordability delivered via regulation.
- California voters rejected Proposition 21, which would have given local governments greater power to enact rent regulations. A similar referendum was rejected in 2018, and a law was passed following the rejected referendum capping rent increases at 5% plus inflation, which is viewed by most housing advocates has having had little practical impact.
- In Portland, ME voters issued a split decision – supporting a local rent regulation requirement but rejecting a limit on short-term rentals (think AirBnB). Portland’s rent regulation is far more renter friendly than California’s, limiting rent increases to inflation plus increases in property taxes. A similar rent regulation referendum was rejected three years ago. The rejection of the short-term rental restriction may produce an interesting interaction with the rent regulation restrictions as landlords weigh shifting from long-term to short-term rental.
- Boulder, CO passed a local fee on rental properties intended to fund legal representation for tenants facing eviction. There is a growing movement to create a right to counsel for tenants in eviction court. It remains to be seen how much traction this trend will gain.
- Nevertheless, support for transit in fast-growing metros has increased across recent election cycles. Previous transit initiatives failed in Austin in 2000 and 2014, and Gwinnett County rejected a 2019 transit measure by over 90,000 votes. The influx of new residents to these cities will continue to expand the demand for transit investments as their infamous traffic jams will continue to plague commuters returning to work. The question becomes “who pays for it?” – local residents, the state/region, or the federal government. Many local transit authorities depend on a dedicated source of local funding; the sales tax increase in the Bay Area and property tax increase in Austin provide long-term, sustainable revenues.
- Both the number and dollar value of transit initiatives on the ballot in 2020 were lower than in 2016. We don’t know why that was the case, although certainly, the pandemic and resulting recession may have been factors that affected a reduced number of referenda for transit and other public spending. We also suspect that the lack of a meaningful federal program for transportation, and uncertainty about federal matching dollars, dampened local enthusiasm. To that end, HR&A is hopeful that the Biden-Harris victory in the Presidential election, which will propel “Amtrak Joe” to the White House, is a sign of brighter days ahead for transit funding nationwide.
- In solidly “red” Collier County, FL, over three-quarters of voters approved a second round of funding for Conservation Collier, a 17-year old conservation and recreation program that’s been lauded for its past success in equitable investment. That’s up from 60% in the initial vote in 2002. By increasing taxes on the median home by about $75 a year, the county will raise $250-300 million. In approving the referendum, voters overruled some County Commissioners who had suggested the program ought to rely on donations for new funding. County Commissioner Penny Taylor rebutted, saying “we value authentic Florida… We came together, Democrats and Republicans, and said, ‘[W]e are willing to put money aside for it.’”
- In Rochester, MN, 61% of voters decided to more than make up for $1.7 million in budget cuts that the City Council had determined to be necessary due to COVID-19 fiscal stresses, even though doing so will require raising property taxes by $33 a year for the median homeowner. This collaborative advocacy effort of the Trust for Public Land (TPL) and Rochester Parks and Recreation won in 50 of 52 precincts and by a larger margin than virtually all the top-of-ballot candidates, including President Elect Biden (54%), Senator Smith (51%), and all winning candidates for Rochester School Board and City Council.
- The priciest initiative we followed was Portland, OR’s agreement by almost 2/3 of voters to increase property taxes for the median homeowner by $151 a year in order expand equitable access to parks. The funding – estimated to total $58.6M annually – will fill a $16 million hole in the system’s operating budget due to a drop in recreation fees during the pandemic, obviate the need for at least some of those fees in the future, expand programming for low-income residents, and make a dent in hundreds of millions of dollars’ worth of deferred maintenance. Portland voters delivered mixed messages on other urbanist issues – rejecting new transit but welcoming a new police oversight board.
- 770,000 voters (nearly 90%) in Chicago said “yes” to support an “act to ensure that all the city’s community areas have access to broadband internet.” Alderman George Cardenas (12th Ward) sponsored the measure to gauge whether Chicago should do more to provide internet access as the city prepares to ensure 100,000 Chicagoans have access to the internet over the next four years through $25 million from Chicago Public Schools, $20 million from philanthropy, and $5 million in CARES Act funding.
- In Denver, more than 225,000 voters (84%) approved a measure for the city to join a growing list of 120+ Colorado communities that opt out of a State law that prohibits local governments from providing broadband internet service – a measure that passed by similar margins in Englewood, and Berthoud, CO.
- Meanwhile, in the town of Lucas, TX, 2,677 voters (60%) voted against investing $19.2 million in a fiber network to reach all homes. This defeat illustrates the challenges of capital-intensive approaches to broadband in medium and lower-density neighborhoods, as well as the potential for technological innovations that enable lower-cost networks – the type of approach that the City of New York is advancing with its Internet Master Plan.
- A proposal to tax commercial property differently than residential property – that would have yielded an annual estimated $11.5 billion in desperately needed funding for schools and other services – involved an amendment to the 1978 Proposition 13, considered the “third rail” of California politics. With powerful interests and $139 million of total spending by both sides, opponents’ arguments about adverse impacts on commercial tenants during a pandemic and fears that the measure could eventually lead to further Prop 13 changes impacting residential development carried the day.
- Graduated real estate transfer taxes on higher-priced sales in Culver City and Santa Monica attracted some opposition, but were each supported by more than 80% of their voters. Another such measure in San Francisco with more fierce opposition earned support from 58% of its voters. These measures all clearly targeted the new resources to assist local economic recovery, among other purposes.
TRANSIT
Are we waiting on the Feds?
By HR&A CEO Eric Rothman
Our country’s divisions in the national elections were evident in support for local transit initiatives. Overall, voters approved around 90% of transit referenda across the country, though the losses include a few large-scale efforts. We were excited to see resounding voter approval for transit ballot initiatives in two regions where we have done extensive work. In Austin, voters approved two initiatives for a combined nearly $8 billion: Project Connect, which will bring several light rail lines and a new tunnel to the Capital region, and Mobility Elections, which will support walking, cycling, and complete streets. In the Bay Area, voters passed emergency funding support for CalTrain commuter rail, whose ridership has been decimated by the COVID-19 pandemic.
We were disappointed to see voters reject the Get Moving 2020 initiative in Portland, OR and the expansion of MARTA heavy rail in Gwinnett County, GA, which lost by a razor-thin margin of just over 1,000 votes. While transit referenda tend to fare better in bluer metros, the results do not align directly with top-of-ballot choices. In Gwinnett County, 58% of voters cast ballots for Joe Biden, meaning that a significant number of Biden voters opposed the transit measure. Nearly 58% of Portland-area voters opposed the Get Moving 2020 measure, which would have funded 150 transportation projects, despite the metro’s deep-blue political bent.
OPEN SPACE
People love parks
By HR&A Vice Chairman Candace Damon
All 27 of the parks referenda that we were watching won in landslides. Results in Traverse City and Garfield Township, MI, were simply the most extreme example of a nationwide trend: while record turnout delivered a host of very close decisions, including one race decided by two votes, locals committed to a 20-year 0.3 mill levy with 72% of the vote in order to renew a commitment to a recreational authority and its capital and operating budget.
As many of us wonder how the other half our fellow Americans could have voted to affirm values so unlike our own, this author wonders whether a broadly shared commitment to quality open space could provide an opening for dialogue.
Readers may recall we were particularly interested in three referenda, which will create new sources of operating revenue to make parks more equitable and inclusive.
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EQUITABLE BUDGETING
Investing in a fairer future
By HR&A President Jeff Hebert
National conversations about social and racial equity tend to focus on Washington personalities and policies, but many injustices, and the means to address them, depend on local government action. Last Tuesday, multiple municipalities took steps to address inequity. San Francisco voters overwhelmingly approved almost $500 million in bonds for homelessness prevention and mental health services, in addition to investments in parks and streets. A Baltimore measure to raise $160 million for affordable housing, schools, community and economic development, and public infrastructure gained over 85% of voter support.
Two other successful initiatives particularly caught our attention. A majority (57%) of Los Angeles County voters supported dedicating funds for additional community investment and alternatives to incarceration for the explicit purpose of correcting racial injustices. Measure J stipulates that the voter-dedicated funds—10% of the County’s locally generated, unrestricted revenues—may not be spent on prisons, jails, or law enforcement agencies. Rather than a one-off budget concession, this apportionment is to remain in effect indefinitely. As Vox’s Roge Karma suggests, this positive vision for the use of public funds—for housing, mental health programs, jail diversion, employment opportunities, and social services—is the other side of activists’ “defund the police” campaigns. Focusing more political energy on what to fund rather than on what to cut may yield more victories like this one in LA County: Karma cites a Reuters/Ipsos poll in which 76% of respondents supported moving “some money currently going to police budgets into better officer training, local programs for homelessness, mental health assistance, and domestic violence” whereas only 39% supported “dismantling police departments” to fund the same types of programs.
Meanwhile, a majority (52%) of Dallas voters approved $3.5 billion in bonds for the Dallas Independent School District (DISD) to repair and upgrade school facilities and invest in school technologies. While this amount will not cover all of the $6 billion in needs identified through DISD’s master planning process, it will fund the renovation of over 200 campuses and the creation of 10 new campuses and 14 replacement schools. DISD will also invest in 4 new Student and Family Resource Centers aimed at addressing racial inequities in historically underinvested neighborhoods—guided by a Child Action Poverty Lab process that HR&A supported. These investments will also prevent adding to a backlog of deferred maintenance, which currently amounts to hundreds of millions of dollars. DISD projects that, as Dallas thrives and the property tax base grows from new construction and appreciation of existing properties, it will be able issue new debt without raising taxes.
DIGITAL INCLUSION
Everyone wants it, but how?
By HR&A Managing Partner Danny Fuchs
Five ballot measures in three states last week demonstrate the crux of the universal broadband problem: everyone wants to address it, voters are supportive of greater local authority to do it, but the details of implementation present obstacles.
As there are growing calls for $100 billion in federal investment for universal broadband – from both the left and the right – we’re excited to be working with local governments, foundations, and innovative broadband businesses to help translate this intention into action at the local level.
TAX RESPONSES TO CRISIS
Formidable, well-funded statewide opposition
By HR&A Partner Paul J. Silvern
We tracked a variety of initiatives that sought to raise new revenues to meet the fiscal challenges of these troubling times. Statewide measures were a split decision, while local measures were mostly approved. Certainly the merits of each measure as the voters saw them mattered, but so also did the sophistication of opposition campaigns and the scale of financial resources that supported them. Voters may also have understood more clearly how proposed local measures could provide direct benefits to solve immediate economic and other problems.
Among the statewide measures with more significant campaigns and war chests on both sides, California’s proposed property tax amendment was declared defeated by a 48%-52% margin, while a graduated income tax amendment in Illinois was defeated by a much wider 55%-45% margin. On the other hand, Oregon’s tobacco products tax won 67%-34% and Arizona’s higher tax on upper-income brackets passed 52%-48%. Among local measures to increase existing taxes or add new ones, Alameda County, San Francisco, Culver City and Santa Monica won their proposals, but a fire protection measure lost once again in San Diego.
The difference in outcomes between statewide and local measures was particularly evident in California:
“Let’s move beyond abstract proposals to concrete implementations of the local state-run banking model. Americans deserve a better, healthier, and more inclusive financial system.”
– Nik Milanovic, Forbes
HR&A’s Public Bank Feasibility Study for the City of Philadelphia was featured in a recent Forbes article on the process for creating public, state-owned local banks across the US. The report, authored by HR&A Partner Andrea Batista Schlesinger and Director Ariel Benjamin outlines the steps to create a City-controlled public bank that puts to work the City’s banking power in the interest of Philadelphians. According to the Forbes author, the recommendations provided within HR&A’s report could serve as a model for a broader system.
Read the full column here.
Learn more about HR&A’s work with public banking here.
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Much more is on the ballot on Tuesday than the White House, Congress, and hundreds of State Houses and City Halls. Local ballot measures may unlock billions of dollars in new spending authority, change the powers of local governments, and shape a more just and resilient recovery – or not.
We’ve worked with our team of experts and collaborators to highlight more than 50 of these measures across 8 issue areas – it’s #UrbanismOnTheBallot
| Affordable Housing | Transit |
| Open Space | Equitable Budgeting |
| Digital Inclusion | Tax Responses to Crisis |
| Additional Measures |
AFFORDABLE HOUSING
Will cities’ role in housing continue to expand?
As growing cities face a housing affordability crisis, voters will weigh in on dedicating additional local funds for affordable housing and expanding and strengthening rent regulations. The majority of these referenda are products of long-running campaigns to increase the role of local governments in addressing affordable housing. These votes will be a good indication of whether voters continue to view affordable housing as a pressing issue – a budget priority. – HR&A Partner Phillip Kash
- Voters in Raleigh, N.C. are deciding on the City’s largest-ever affordable housing bond. Portions of the $80 million raised would be used for public-private partnerships, gap financing, and purchasing land for affordable housing along new transit lines. $50 million in bonds on the ballot in Charlotte could increase the supply of affordable housing in North Carolina’s largest city, too.
- In Detroit, City government is seeking permission to issue $250 million in bonds to rehab 8,000 homes and demolish an additional 8,000 homes that contribute to blight. HR&A is helping the city develop the programs that would enable Detroiters to access affordable housing and make neighborhood improvements through this program.
- Californians will consider lifting limitations on local rent controls once again. On the other side of the country, Portland, Maine could limit rent increases to the rate of inflation and restrict short-term-rentals to owner-occupied properties.
- Coloradans could embrace new taxes to stem the tide of homelessness. In Denver, increasing the sales tax by 0.25% would mean an additional 1,800 units of supportive housing. In Boulder, a $75 annual fee per unit on landlords could mean $1.9 million to provide legal representation to tenants facing eviction.
- Nonprofits could get a boost in Georgia. Statewide, voters could exempt nonprofits from taxes on properties they are using to build or repair single-family homes for affordable housing. In Atlanta, voters could exempt homes located on community land trusts from $30,000 in property taxes.
TRANSIT
Will cities build back better with transit?
In the face of devastating and disparate impacts of the COVID-19 pandemic, transit investment remains critical to the well-being of our communities. Ballot initiatives across the country seek new funding to invest in diverse mobility options – including rail, bus, walking, and cycling - in support of a just and resilient recovery. In Austin and Portland, equitable access, affordable housing, and anti-displacement measures are incorporated into mobility proposals. And as core suburban areas like Georgia’s Gwinnett County seek to strengthen their position as centers for knowledge economy jobs, they are increasingly finding that high-quality transit connectivity within the metropolitan region is essential to their competitiveness. – HR&A CEO Eric Rothman
- Propositions in the Austin, TX, and Portland, OR metros would fund improved transit connections and diverse mobility options with equity in mind. Austin Prop A, a property tax increase of approximately 4% would fund a $7.1 billion mass transit system and some 27 miles of rail service while earmarking $300 million for anti-displacement measures and affordable housing along the TOD routes. Austin Prop B includes infrastructure like sidewalks, bikeways, and transportation safety projects, and is viewed as a climate change prevention and transportation measure. Portland’s Measure 26-218 would fund ~150 transit projects in 17 regional corridors through proposed projects including light rail, rapid regional bus, and off-street biking and pedestrian improvements.
- In Gwinnett County, GA, the expansion of the Metropolitan Atlanta Rapid Transit Authority (MARTA) through a 1% sales tax is up for vote. Voters have rejected joining MARTA in the past; this latest proposition promises local control, with County residents sensitive to the idea that funding would be used for MARTA operations elsewhere in the region.
- In the Bay Area, voters could authorize a measure to increase the sales tax by 1/8 cent to support the operations and expansion of Caltrain. The system risked closure this past spring with the vanishing of its regular ridership.
OPEN SPACE
Will voters overrule City Hall on parks’ budgets?
We have come to rely on parks as never before – for respite, celebration, protest, and emergency response. Simultaneously, as is usual in fiscal crises, parks systems’ budgets have been among the first and most deeply cut. Efforts to restore or increase parks’ budgets include bond measures to acquire land for future parks and build dreamt-of parks. More exciting (if less sexy) are the 10 or so initiatives that will increase funds for the maintenance functions that ensure parks deliver on their promise. (Thanks to the Trust for Public Land’s (TPL) excellent ballot tracker from which we were made aware of many of these measures.) We’re particularly interested in the results of three referenda, which seek to create sources of operating revenue that will make parks more equitable and inclusive, including by reducing user fees, strengthening programs for families, and focusing on career tracks. – HR&A Vice Chairman Candace Damon
- In Rochester, MN, voters are considering whether to raise property taxes for the median homeowner by $33 in order to better maintain the parks system, including by “improv[ing] access to existing parks and recreational facilities for kids and people with disabilities.” The initiative is a product of TPL collaboration with the City’s Parks and Recreation Department.
- In Portland, OR, the City Council referred a five-year parks and recreation local property tax levy pricier than Rochester’s to the voters. With an annual increase of $151 for the median homeowner (same median home value as in Rochester), the proposed tax increase will restore budget cuts and “center equity and affordable access for all,” including by offering more free programs to low-income households. It has been advanced by Portlanders for Parks and endorsed by a diverse group that includes the Portland Business Alliance, Nike, and a host of groups focused on the concerns of local communities of color.
- In Collier County, FL, a second round of funding for Conservation Collier, a17-year old program to acquire and maintain land for conservation and recreation, is on the ballot. Proposed to be funded with a property tax levy that will increase taxes on the median home by about $35, 25-35% of funds raised will be dedicated to maintenance costs. Vincent Keeys, president of the local branch of the NAACP, stated, “As this pandemic, … environmental justice, and racial injustice ravage this nation, … we often look to Mother Nature for the cure.” Keeys, who grew up across from Fairmount Park in Philadelphia, noted the importance of reclaiming healthy green spaces for communities of color and low income and applauded Conservation Collier’s past success in equitable investment.
EQUITABLE BUDGETING
Will voters approve new spending on equity?
Budgets are statements of priorities. We’re watching referenda that could unlock $4.7 billion to advance more equitable spending. Three cities – Baltimore, Dallas, and San Francisco – all have bond issuances on their ballots, while Los Angeles County’s referendum would set spending guidelines for existing revenues. All four initiatives would invest in community members who face neighborhood disinvestment and discrimination. As one example, $41 million of the Dallas Independent School District’s bond program would be earmarked for Student and Family Resource Centers for building racial equity, which HR&A and the Child Poverty Action Lab helped conceive. – HR&A President Jeff Hebert
- If Dallas voters approve the largest bond election in Texas history, they will invest $3.7 billion in new and renovated school facilities, $41 million of which for the aforementioned community resource centers with wraparound services.
- Los Angeles County voters could require that their government spend at least 10% of the general fund on community alternatives to incarceration. This would protect $400 million from being spent on law enforcement or jails, instead guiding it to housing, mental health programs, and social services that could keep people out of the criminal legal system.
- If two-thirds of San Franciscans sign on to Measure A, they will dedicate $239 million to open space, $207 million to mental health supports, and $41.5 million to improving public streets and plazas.
- A host of ballot measures for new borrowing in Baltimore could mean $72 million for public buildings and infrastructure, $38 million for school facilities, $38 million for community economic development, and $12 million for affordable housing.
DIGITAL INCLUSION
Will cities take charge of their broadband future?
In a year that has highlighted America’s digital divide, in which 18.4 million households lack broadband internet service, communities across the country are asking voters to help them connect all residents. Some are asking for new powers to override State limits on local sovereignty while others are asking to take matters into their own hands and invest millions of dollars to ensure internet access for all. With ISPs maintaining near monopolies in many cities, these attempts for greater local control are inevitable, and could unlock greater innovation at the local level. – HR&A Managing Partner Danny Fuchs
- The most ambitious effort belongs to Lucas, TX, where voters could approve more than $19 million in public bonds to create a city-run broadband utility that would offer subscription service to local households and businesses. The measure follows a feasibility study that recommended a 108-mile backbone fiber network to connect all residents and businesses within city limits.
- In Colorado, Denver, Englewood, and Berthoud could join a growing list of 120+ Colorado communities to opt out of a State law that prohibits local governments from providing broadband internet service. While the measures would not automatically establish municipal broadband, voter approval would permit the cities and towns to experiment with public options.
- As Chicago prepares to spend $50 million to expand broadband access to 100,000 residents, voters will weigh in on the question: should “all the city’s community areas have access to broadband Internet?” – a chance to justify bolder investment still.
TAX RESPONSES TO CRISIS
In a year of crisis, will taxes provide relief?
As states and municipalities recover from a year of unprecedented public health and climate crises, ballot measures seeking to create new tax revenue have emerged as important sources to fund increased expenditures. Most of these initiatives levy new sales, utility, and/or parcel taxes. Many, however, go beyond flat-rate general fund tax increases to create more progressive tax structures that focus on high-value property sales and businesses with disproportionately high executive incomes. These tax increases would generate new revenue to ensure effective crisis response, including economic recovery and future disaster preparedness. – HR&A Partner Paul J. Silvern
- San Francisco residents will consider a host of tax-related measures: restructuring business taxes, doubling the real estate transfer tax for high-value properties, and taxing businesses whose ‘overpaid executives’ earn more than 100 times as much as their median employee in the city.
- In Los Angeles County, Culver City and Santa Monica are considering increases to property transfer taxes to fund a mix of local services. Culver City’s graduated rate would raise $6 million per year and Santa Monica’s flat rate would raise $3 million per year.
- Voters across California could modify property tax limitations introduced in 1978, requiring that commercial and industrial properties are reassessed to market value every three years, among other changes. These changes do not affect existing property tax limitations on residential or agricultural properties, however.
- Arizona’s increased income tax on individuals earning over $250,000 and couples earning over $500,000 would increase funding for public schools, especially teacher salaries. Illinois voters, meanwhile, could repeal their state’s flat income tax, allowing for the introduction of six graduated tax brackets.
- In wildfire-stricken California, Berkeley and San Diego County voters could authorize parcel taxes to fund fire protection.
- Oregon and Colorado voters could increase taxes on tobacco. Oregon would focus funding on healthcare programs. Colorado would turn the revenue toward health, housing, and education.
ADDITIONAL MEASURES
Will systemic change win at the ballot box?
Ballot measures often come in waves, as the most urgent issues of the day inspire change and as citizen-led efforts in one jurisdiction spark action in another. More than two dozen local and State initiatives this year would reform policing and address mass incarceration. As the pandemic continues to batter the economy, worker safety nets are on the ballot. And the trend toward cannabis legalization could make its way to four additional states, with direct investment in restorative justice in at least two.
- Justice is on the ballot across the country, as numerous cities and counties, from Oakland to Philadelphia to King County, WA, are weighing reforms to police oversight, policies, and budgets in the wake of George Floyd’s murder at the hands of police in May. California is considering measures to restore voting rights for people on parole for felonies and to end cash bail, while Oklahoma would prevent prior non-violent felony convictions such as drug crimes from factoring into sentencing for people convicted of other non-violent felonies. The Vera Institute offers a deep dive into justice issues on the ballot.
- Workers could gain or lose rights as the pandemic continues to batter the service sector. In one of the country’s highest profile (and the costliest) referenda, California’s Prop 22 would reclassify drivers for Uber, Lyft, and other gig companies as independent contractors rather than employees, reversing a 2019 state law that extended labor protections to these workers. The gig companies argue workers benefit from the flexibility of independent work; Prop 22 proponents say only employee classification can protect workers’ interests. The voters will decide. Meanwhile, Colorado could become the first state to enact a paid leave policy by referendum, and both Florida and Portland, ME, could join the wave of jurisdictions establishing a $15 minimum wage.
- Four states could legalize marijuana this year. Arizona has the most progressive measure, with proceeds from a 16% sales tax distributed among community colleges, justice reinvestment, public safety, and infrastructure. Licenses would also favor people from communities impacted by marijuana laws. New Jersey would become the first state in the mid-Atlantic with legal cannabis. South Dakota and Montana round out the list.
Written by Danny Fuchs, David Gilford, and Ariel Benjamin
Universal high speed internet access is foundational to addressing American inequality, particularly in education, employment, and healthcare. Nearly every effort to address inequality relies in some way on the internet. Yet more than 18 million American households live without a broadband subscription, 13.9 million of them in metro areas. In urban counties, people of color represent 75% of all unconnected residents.
The private market will not close this digital divide on its own. Nearly 28 million American households have a single choice of broadband provider; millions more live in duopolies. Government primarily serves as a regulator—recently, an anti-city, anti-competition regulator—with a few programs that subsidize internet service providers’ (ISPs) service of low-income residents.
New models of public-private partnership are essential to achieve universal broadband. The public and civic sectors have three principal tools to shape these partnerships:
- Investing capital directly in building networks, deploying fiber and other infrastructure;
- Making real estate assets available to support broadband deployment —especially street poles, which are essential for 5G deployments; and
- Aggregating demand for internet service to leverage collective buying power.
Given the scale of the required capital investment, complex regulatory framework, and essential nature of street poles to 5G, government will be a part of any comprehensive solution. However, communities themselves need not wait to act. Detroit’s Equitable Internet Initiative and New York City’s NYC Mesh and Silicon Harlem show how neighborhood-governed broadband infrastructure can be deployed to provide faster, cheaper service with better privacy than incumbent ISPs’. These community organizing efforts are essential to a more equitable broadband future. Scaling them presents opportunities to unlock local economic opportunity, prioritize community values in the delivery of services, and begin closing the digital divide. Bringing these efforts to scale will require attention to these lessons of the initial efforts:
Aggregating demand changes private partners’ development economics.
ISPs invest where they can be assured a reasonable rate of return. In deciding whether to expand to a new neighborhood, an ISP estimates revenue that will accrue through adoption (the rate at which a household subscribes to any internet service) and take rate (the rate at which a subscriber household chooses a particular ISP over the competition’s). This expected revenue is compared to estimated costs: financing the required infrastructure investment, operations and maintenance costs, and the cost of marketing and sales to new customers. When communities pool households or businesses, they are guaranteeing a take rate while reducing customer acquisition costs. This permits ISPs to provide bulk discounts and assurances on performance and other community priorities, like privacy.
Aggregating demand can take different shapes, such as bulk purchasing internet service at negotiated rates or guaranteeing a threshold of monthly revenue and/or underwriting the service provided to low-income subscribers. Aggregated demand can help ISPs finance critical network investments in areas where broadband infrastructure is poor. In areas where affordability is a challenge, aggregated demand can connect households across larger geographies.
Collective purchasing enables organizations to obtain better services and pricing.
From school districts to church groups, community development corporations to unions, organizations can approach ISPs to evaluate options, negotiate rates, and reduce overall costs. As with home heating oil buying clubs and community group-led solar installations, group purchasing programs have achieved cost reductions, while empowering members to make educated decisions on topics from price volatility to sustainability. Among these early successes, we number:
- The New York City Department of Education’s (DOE) recent purchase of 300,000 internet-enabled iPads to enable remote learning. In April, DOE reported paying T-Mobile $10 per month per device for unlimited data, 70% less than the typical retail price for this service.
- Chicago Connected’s issuance of a Request for Proposals to connect low-income households with the best-possible internet service package, including minimum speed thresholds. This public-private partnership that aims to close Chicago’s digital divide, intends to guarantee payment to the ISPs, reducing risk while unlocking a new customer segment for the provider.
- South Bend, Indiana’s non-profit business accelerator, enFocus’ development of nCloud, a shared IT purchasing program for non-profits to access the local dark fiber network, ChoiceLight. Aggregating the high-speed internet needs of over 20 organizations allowed each to receive connectivity for less than 10% of a commercial provider’s rates.
- At a smaller (and less effective, less equitable) scale, condo boards in some urban areas have negotiated with incumbent carriers to wire buildings for fiber-to-the-home by committing that a specific percentage of residents sign up for service.
Scaling this approach will require cross-sector collaboration and specific expertise.
While such successes should be celebrated, they have not yet achieved scale. Organizations that have large membership or stakeholder bases, from universities to unions, are best positioned to create larger-scale programs. Yet delivering aggregated demand to ISP partners requires skillsets and expertise outside most of these organizations’ core competencies: few are well-positioned to surmount administrative and regulatory hurdles, nor to deliver on customer service responsibilities. Helping to build this capacity—whether in-house to the nonprofit or contracted out—will require the involvement and partnership of philanthropy, technology firms, marketing experts, and entrepreneurs in bespoke combinations—unless and until national models emerge. Nonprofits with large memberships that successfully grapple with this challenge will not only provide new benefits to their members, but also secure a source of unrestricted operating income. One approach that seems to have significant promise is for these organizations to bundle their aggregated demand into a municipally led public-private partnership, enhancing what local governments can offer private partners.
Nonprofit-led demand aggregation presents an opportunity to help local governments build capacity.
On its own, aggregated demand will not close the digital divide. It will not expand broadband networks to serve every neighborhood, ensure public ownership of fiber infrastructure, fund robust digital literacy programs, or unlock the street poles critical for the delivery of 5G. While it may help enable, it cannot force capital investment in a new network. Local government has the power to coordinate these levers, although it may not have the resources. Helping local nonprofits develop demand aggregation programs is a starting point, but equally important is understanding what else is needed, specifically infrastructure investment and leveraging real estate assets.
Developing that understanding is critical: local and regional governments must position themselves for an evolving landscape and forthcoming federal investments. Broadband is poised to be a central piece of the next big federal infrastructure bill, already passed in the House of Representatives, and any future comprehensive federal COVID-19 recovery package is likely to include quick-spend broadband infrastructure support. In addition to federal money, broadband infrastructure will likely draw private capital to fund deployment. Telecom industry analysts are predicting rising demand for fixed broadband as people seek better performing internet at home, and private investors began the year with a record $1.5 trillion in unspent cash and are eager to invest. Communities with ready-to-go broadband plans, as well as the administrative capacity and the political support to advance them, will be ahead of their peers to take advantage of these substantial future sources of funding.
HR&A Advisors is excited to announce that our Partner, Jeff Hebert, has been appointed as the Company’s President and elected to our Board of Directors. “Our Partners and I are thrilled to have Jeff on our executive leadership as President,” said HR&A’s CEO Eric Rothman. “Jeff’s client work and experience with urban revitalization, economic development, urban infrastructure, climate resilience, inclusive growth and equity are central to the recovery and future success of American cities.”
Jeff will join Board Chair John Alschuler, Vice Chair Candace Damon and CEO Eric Rothman in the leadership of the firm and will retain a client practice. Jeff’s promotion advances the firm’s broader strategic management changes and leadership transition announced at the end of last year.
Since joining the firm Jeff has led real estate market analysis, economic analysis, climate resilience, and strategic planning projects for clients across the country and has most recently been a leader of the firm’s A Just and Resilient Recovery initiative and Covid-19 economic recovery consulting. For the past year he has served on the firm’s Management Committee.
I am honored to join the leadership of HR&A. In my new role as President, I will have greater opportunity to shape the future of the firm while continuing the work of meeting the challenges that cities face. I thank my partners, and especially John, Candace, and Eric, for this exciting opportunity.
– Jeff Hebert
The CEO and President will work together to ensure that HR&A remains an industry-leading consulting firm that provides strategic advisory services for clients in the public, private, and non-profit sectors, focused on real estate, economic development, and public policy. HR&A will also be at the forefront of providing solutions to the complex and interconnected challenges cities continue to face around race, class, climate change, inclusive economic growth, crumbling infrastructure, technological innovations, and housing affordability. As President, Jeff will ensure that the firm has the talent and business infrastructure to provide outstanding and innovative service to our clients.
“Jeff is an exceptionally talented professional and represents a new generation of leadership at HR&A,” said HR&A Chair John Alschuler. “As he becomes President and joins our Board, I look forward to him building on HR&A’s mission to improve economic opportunity, quality of life, and the built environment.”
Prior to joining HR&A, Jeff served Mayor Mitch Landrieu and the City of New Orleans in many capacities, including as the First Deputy Mayor & Chief Administrative Officer, Chief Resilience Officer, Executive Director of the New Orleans Redevelopment Authority, and the Mayor’s blight czar. In these roles he managed the day to day operations of City Hall, tackled the crippling blight issues plaguing New Orleans, and refocused over $250M in place-based development investments. He began his career working on the redevelopment of Downtown Brooklyn.
In addition to his role as President of HR&A, Jeff is the Co-Chair of FUSE Corps, and serves on the advisory boards of the ULI Center for Sustainability and Economic Performance and the Reinvestment Fund.
HR&A is a leading, national consulting firm providing services in real estate, economic development, and public policy. HR&A has over 100 employees with experience as public servants, non-profit managers, city planners, economists, and real estate developers based in our offices in New York, Dallas, Los Angeles, Raleigh and Washington, DC.
“There is no going back to the Manhattan retail landscape of 10 years ago or even 10 months ago. We must rethink how we use ground-floor spaces and focus those efforts on the avenues—or some subset of them—to create a critical mass of activities and experiences. Without doing so, we risk losing the vitality of Manhattan altogether.”
HR&A Principal Sulin Carling penned an op-ed in Crain’s New York on the dire straits of Manhattan retail and why business improvement districts, civic organizations and government should be re-thinking storefronts as we emerge from the pandemic.
Read the full op-ed here.