About Those Suburbs and Cities

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As the dimensions of the mortgage crisis both expand and get clearer, a new picture is emerging of a nation in pain that simultaneously is coming to new conclusions about what it means to be safe and secure in America. For the first time since post-war federal policy ganged up on cities to promote suburban expansion, cities are rebounding in remarkable ways and suburbs appear to have reached some kind of new limits to growth. The evidence of this profound shift is easy to find if you look.

First, here in Michigan and across much of the country, the towering growth in homeforeclosures is hitting the newest suburbs at least as hard, and in most cases harder than it is striking the state’s cities. Foreclosures in West Bloomfield and Birmingham are occurring at the same or higher rates than the rate of foreclosures in Detroit and its older suburbs.

The same is true, according to this article in the Atlantic Monthly, in Florida, California, Colorado, Georgia and other states.

Cities meanwhile are attracting new residents and new wealth, so much so that vast tracts of the urban landscape in cities as different as New York and Salt Lake City, Boston and Denver, Seattle and Knoxville, Chicago and Atlanta, and dozens of others, are being completely rebuilt.

This is a remarkable transformation. For most of my life cities were places to dismantle, not build. I was a kid in the 1960s when city officials and U.S. housing administrators teamed up to tear down much of White Plains, N.Y., my home town, as part of the federal urban renewal program. An elegant network of narrow streets and historic offices and walk-ups was replaced by Houston-like boulevards. A windowless mall was built near the center of town that became one of the most dangerous places to shop in the whole state. White Plains gradually came to its senses and slowly began to replace the urbanism that was removed, and the city is experiencing its own economic and cultural renaissance.

Chicago, too, is undergoing more than $1 billion in new housing, retail, and commercial investment along south Michigan Avenue, an area that encompasses hundreds of acres of old warehouses, storage buildings, and light industrial facilities. Boston is building a new city above the Big Dig. Los Angeles is rebuilding Grand Avenue. New York is planning 45 million square feet of homes and offices above a rail yard along the Hudson River.

A third bit of evidence is the popular clamor for modern transit. Grand Rapids recently won federal approval for a new rapid bus system, and as much as $29 million in US support to build the 10-mile line, which could be the first rapid transit line built in Michigan since early in the 20th century.

Northern Virginia is planning to build a new streetcar line, which would join a growing number of other streetcar systems, including operating lines in Portland and Kenosha, Wisc. And Atlanta is considering a new streetcar line along its famous Peachtree Street.

What appears to be occurring in the United States? Time-wasting, costly, energy-inefficient, land-consuming, and obsolete exurban patterns of development are taking new forms. The institutions that supported the old patterns are grievously injured. Citibank today announced a $23 billion write off connected to sour loans in its mortgage business. The American auto industry continues to shrink. Developers are going bankrupt, among them Levitt and Sons, which built the first auto-dependent cookie cutter suburb after World War Two, New York’s Levittown.

Coming up in their place are builders of new transit systems, designers of new green housing and LEED certified office buildings, and the entrepreneurial high tech businesses popping up downtown in small places like Traverse City, and big places like Charlotte.

Toronto Transit City

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In 1954, the year that Detroit was busily completing the Lodge Freeway and starting construction on the city’s other major highways Toronto (see pix) opened 12 stations on the Yonge Street subway line, the city’s first. Since then Toronto has built three more regional rapid transit lines, 69 stations, and nearly 43 miles of subway and rapid transit track. The city’s subway and surface streetcar system carries 1.2 million passengers a day, many of whom also use the seven commuter train lines into town. Only New York and Mexico City have a more extensive rapid transit system than Toronto. Detroit, meanwhile, has none.

 The contrast between the two cities in economic competitiveness, quality of life, and opportunity is just as stark. Detroit’s population, now less than 900,000, is less than half of what it was in 1954, when the number of Detroit residents peaked. The Detroit metropolitan region, where 4.8 million people live, has grown by roughly 100,000 residents since 1970. The number of vehicles, meanwhile, has increased by 1.6 million during the same period. Southeast Michigan has the highest rates of racial and economic segregation, joblessness, income stagnation, home foreclosure, heart disease, diabetes, and obesity of any major metropolitan region in the United States.

Toronto, meanwhile, has steadily grown to a city of 2.5 million, and the population of the metropolitan region — 5.1 million — is nearly double what it was in 1970. The largest city in Canada, and the fifth largest city in North America, Toronto also challenges New York as the continent’s most racially diverse and most prosperous. 

Toronto’s economy is booming, and a great deal of its well-being has to do with how regional managers and residents view rapid transit as an excellent investment for responding to the new market signals of the 21st century. Canada was a signatory to the Kyoto Accord, which commits the country to reducing global climate change gases by 2012 to 6 percent less than the levels produced in 1990. Canada also has a national transit strategy that calls for:

  • Improving the global competitiveness, quality of life, and environmental sustainability of Canada’s cities.
  • Requiring cities to have land use and transportation plans that favor transit as the primary means of accommodating future travel demand.
  • Providing funding necessary to maintain and expand Canada’s urban transit systems in order to accommodate population growth and to allow transit to attract a larger share of the total travel market.
  • Providing increased mobility for people so that they can take advantage of the employment, educational, recreational, and many other opportunities cities offer.
  • Improving air quality and, in doing so, improve people’s health and their ability to enjoy outdoor spaces and activities.
  • Ensuring the long-term economic stability and environmental sustainability by reducing climate-changing emissions and reliance on fossil fuels.

These, by the way, aren’t just hopeful words. Canada means what it says, and nowhere is it more visible than in Toronto. On June 15, Ontario’s Premier Dalton McGuinty announced that the provincial and federal governments are teaming up to spend $17.5 billion to modernize and build roughly 550 miles of rapid transit lines throughout the Toronto metropolitan region by 2020. It is the largest and most extensive metropolitan rapid transit investment in North America since New York spent $24 billion from 1982 to 1999 to modernize its aged subway and bus system. That investment helped to spur an economic and demographic revival that reestablished New York as a choice place to live and do business.  

Toronto already is a grand place. Its downtown is a hub of activity 24/7 with outdoor cafes busy well into the evening. Its suburbs, though jammed with vehicles, are a display of gleaming office towers set amid a natural and agricultural landscape that the provincial government is determined to conserve. One of the region’s land use plans calls for preserving 1.8 million acres of open space and farmland in the region; one million acres already have been saved. 

Detroit turned down a $600 million federal transit grant in 1976 and can’t agree even now on using $100 million in federal funds to revive a heavy commuter rail line between Ann Arbor and the central city.  Toronto’s new transit construction plan, meanwhile, will reduce pollution, congestion, and travel costs in a world where temperatures are rising and gasoline is heading to $8 a gallon. If you were a young person, which city is more inviting?  

Mode Shift Postcards From Around The Nation

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 Though it’s completely understandable why the triple whammy of rising peak oil energy prices, global climate change, and record population growth might get you down, here are a number of promising Mode Shift trends that indicate the end is not nigh.

Singles now head the majority of American households and are repopulating America’s great cities. This from Baltimore, according to the May 29, 2007 edition of the Baltimore Sun: “Across Baltimore, single women – old and young, black and white – are buying houses, many for the first time, at rates far exceeding the national average. According to a 2006 survey conducted by the National Association of Realtors, 40 percent of city homebuyers last year were single females, nearly twice the national average and the Baltimore County rate.”

In Denver, the expanding Fastracks regional rapid transit system is encouraging suburban communities served by the light and heavy commuter rail lines to embrace higher density neighborhood development. The reason: It makes sense in a transforming world. “Metro Denver now averages 4 or 4.5 homes per acre,” reports the Denver Post. “Increasing that to 6.5 or 7 houses per acre will mean smaller lots, which use less water than larger lots, and more compact developments, which will shorten the length of vehicle trips and improve the air quality. Perhaps as valuable is the intangible effect of improving transit for commuters and creating more jobs that are closer to home.”

California Attorney General Jerry Brown is using the newly approved Global Warming Solutions Act, which requires reductions in greenhouse gas emissions, to challenge sprawling patterns of development. The San Francisco Chronicle reported on May 27, 2007, that Brown and lawyers in six other pending cases are using the landmark law enacted last year by Gov. Arnold Schwarzenegger to argue that the “state must rethink the kind of immense and far-flung housing developments that have defined California land-use patterns for decades. The global warming fight has given new ammunition to the battle against sprawl, which detractors argue creates more cars on the road and energy use and is therefore a key ingredient in the climate-change crisis that threatens the California coastline and snowpack. The need to rein in sprawl has not received much attention from Schwarzenegger, who has garnered international attention as he has talked about creating more efficient cars, boosting solar power, and developing new carbon-trading markets for industry. But experts, including the governor’s own climate advisers, argue that changing how housing is developed is key to meeting the emissions reductions.”

Lawmakers in the Arizona state House, by a 50-1 vote, late last month approved new legislation that has already passed the state Senate and provides authority under the state growth management law to limit new sprawl in communities that have tight water supplies. Democratic Governor Janet Napolitano, who supports the measure, is expected to sign the bill any day. The Los Angeles Times picked up the story in its May 27, 2007 edition:  “Legislative approval of the measure came a quarter-century after the 1980 enactment of a historic groundwater management law imposing new pumping and irrigation restrictions in ‘active management areas.’ Those areas include Phoenix, Tucson and Prescott. Those urban-oriented restrictions were aimed at curbing groundwater depletion that outpaced natural replacement. Subsequent population growth in the nation’s fastest growing state has started to crowd some rural areas, leaving some straining to secure adequate water supplies. In parts of eastern and northern Arizona, residents have to truck in water.” 

Indianapolis (see pix) is gaining national recognition as one of the nation’s most significant comeback cities. According to an article in the June 1, 2007 edition of the Rochester (Minn.) Post-Bulletin, Indianapolis has invested more than $6 billion of public and private funds in a host of downtown projects. More development is on the way — again through public and private partnerships — and $3.2 billion more in construction and renovation efforts are on the drawing board.  “Some 1,500 residential units — condos, houses and apartments — totaling nearly $348 million will be completed by 2010. In just the past few years, the inventory of hotel rooms has increased 44 percent to a total of 5,338 rooms.”

Why Cities Are Thriving

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Packaged Facts, a useful site for keeping track of demographic and economic trends, just published an analysis of US Census figures that concludes singles now head the largest number of American households. For years demographers have documented the declining size of the US household and the rising number of total American households. Now we find that the single person is the majority.  

Packaged Facts found that “America’s 89.6 million singles head over half of America’s households — 50.3%, according to the 2006 U.S. Census. Several trends converge to make singles the majority group. Adults are marrying later (or not at all), divorce rates remain high, and increasing numbers of adults live together without exchanging “I dos.” “More racially diverse than the overall population, singles are also younger: 57% are less than 45 years old, whereas nearly a quarter are Baby Boomers.”

The Mode Shift point is that the place that more singles are choosing to call home also happens to be America’s urban areas, according to US Census figures. Central city neighborhoods are gaining population for the first time since the 1940 and 1950s. Singles seek cities for a number of obvious reasons — jobs, entertainment, social networking, tribalism. Still, my own reporting from various metropolitan regions across the country in recent months — Knoxville, Salt Lake City, Seattle, New York, Washington, Chicago, Detroit, and Grand Rapids — indicates that single people — young, middle age, and seniors — also are motivated by time and expenses. They’re finding it less expensive and more efficient to live in cities where housing costs may be higher, but those costs are offset by much lower transportation expenses — less driving. They also have more time because the places in their lives are closer, and many feel safer now in the city than they do in suburbs that can be very isolating.

The effect of this demographic trend, coupled with rising energy and land costs and static incomes, is having profound effects on housing choices and development patterns. These are becoming more apparent to builders and planners. Dwellings, enormous now, will start to become smaller, closer together, and closer to metropolitan centers. Salt Lake City is a good example. Townhomes and apartments built close to the region’s rapid transit line are selling out even before they are built. Many buyers are single. The homes are priced and sized right — $200,000 for 1,400 square feet — and located near the center of things.

Inc. Magazine Hot Cities: Not One in Upper Midwest

The annual tally of American “Boom Towns” in the May issue of Inc. Magazine includes not one — repeat, not a single large, midsize, or small city in the Great Lakes region that qualifies among the nation’s top generators of new jobs. If the entire Midwest is considered, the only two cities that sneak onto the list are Springfield, Missouri (ranked # 20 among midsize cities) and Dubuque, Iowa (#15 among small cities). 

The list does include some of our favorite Mode Shift metropolitan regions in the midst of implementing a new economic development strategy based on environmental sensitivity, energy efficiency, land conservation, rapid transit construction, and more compact patterns of housing and business development. Salt Lake City is ranked 10th among large metropolitan areas, followed by Washington, D.C. (#13), Sacramento (#15, see pix) , Houston (#17), Seattle (#18), and Portland (#20).

That still leaves the upper Midwest out of the picture, and for good reason. Consider Michigan, my adopted state. The auto industry here has been shrinking for 35 years. Cities are the most economically and racially segregated in the nation. The state’s joblessness is the highest in the nation, and its fiscal deficit ($700 million to $900 million, depending on who’s counting) is the largest. sacramento.jpg

Though blessed with an astonishingly beautiful landscape and abundant natural resources, especially fresh water, the state still views the 19th century strategy of exploitation as more capable of generating jobs than a modern stewardship approach that weighs industrial innovation with robust conservation. Michigan should be the global leader in all things water, just as California is the global leader in computer technology, and New York is the global finance and media capitol.  The state government ain’t listening much. Michigan ranks 47th out of the 48 contiguous states, according to a new analysis by the Land Policy Institute at Michigan State University, in per capita public spending on natural resource protection and conservation. Only Georgia spends less per capita. 

Now you might think that such dismally telling statistics might get a few people in our state capitol upset. Hardly. For months now Democratic Governor, Jennifer M. Granholm, and Legislative leaders of both parties, have been wrangling not about how to leverage public dollars to innovate, but over the old canard of raising taxes or cutting spending to close the deficit, which is now threatening to prompt big reductions in public school budgets and health care. 

The governor argues that a tax increase is needed. Republicans, who last year enacted a $1.9 billion tax cut for businesses (20 percent of the state’s general fund revenue) without developing a replacement, say more program cuts are needed, not more revenue. 

The GOP’s view here is consistent with the party’s thesis that tax cuts stimulate economic actvity. That theory, though, has been proven completely false in Michigan.  During the 1990s, Republican Governor John Engler, helped by a Republican-led Legislature, enacted a continuous series of measures that reduced the percentage of income that state residents pay in state taxes from 8 percent to roughly 6.7 percent, according to an analysis by the Citizens Research Council, a respected non-partisan public policy research group in Livonia. Michigan is in the middle of the national pack in the percent of income wage earners and companies pay for taxes.

The cuts, though, drained billions of dollars from state revenue and hurt the public institutions and programs that other states are fortifying to improve their competitiveness. In Michigan, tax cuts translated into a $275 million reduction in state aid to universities over the last four years, $172 million cut from human services over the last five years, $323 million cut from public schools, and $447 million in cuts in revenue sharing to operate cities and towns. State employees gave back $186 million in concessions to save money, and 7,400 jobs were cut from the state payroll. 

In other words if tax cuts truly made a difference, then Michigan would not be the national leader in joblessness, would not lead the nation in the number of educated young people who leave the state to seek opportunity elsewhere, and not be at the very back of the national pack in creating new businesses and jobs. The data show that tax cuts grievously injured the state’s well-being and competitiveness. 

Trouble is the Democrats have no counter proposal except tax increases. Neither Democrats nor Republicans are talking about the fact that Michigan state government will spend $40 billion this year to support a menu of programs, $10 billion on economic development alone, and is using that money to vigorously pursue an economic strategy that is firmly mired in the 20th century. Highway building instead of rapid transit. Taxpayer subsidies to lure new companies that aren’t coming. Agriculture programs designed to supply global markets with cheap grain and milk, and are producing dairy and hog factory farms that are among the state’s largest water polluters. Investment programs for infrastructure that penalize cities and spur new development in the countryside. If you want to see what happens in a place where new ideas are not seen as a virtue, and partisan division and turf protection trumps collaboration, come to Michigan.

A last thought: Seeking a Mode Shift economy that delivers good jobs, business opportunities, and a high quality of life is not a partisan issue. Utah, the most Republican state in the country, also put the Provo and Ogden metropolitan regions on the list of Inc. Magazine boom towns. The state achieved its robust economy by investing state funds in new industries like computers and outdoor recreation, and by building one of the most robust rapid transit systems in the nation. Tax cutting was not high on the operating agenda. Utah’s population (2.5 million) is 75 percent lower than Michigan’s 10 million residents. The state budget is $10.8 billion this year. Utah also has a $1.8 billion budget surplus.