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The Price of Mobility
How Do We Fix the Gas Tax?

What are the hardest long-term problems around these days? Global climate change? Stateless terrorism? Nuclear proliferation? The possibility of pandemics? OK, so funding highways and transit isn’t in that class of problem, but clearly we need to make major changes in the way we plan, build and pay for mobility. Reason: We’re running out of money doing it the old way.

The problems of transportation finance are obvious: The cost of projects is spiraling out of control, and revenues from traditional sources (the tax you pay at the pump) aren’t keeping pace. Hence, this startling projection: The federal Highway Trust Fund, which is used to pay the federal share of highway and transit construction, will run out of money as soon as 2009. What happens then? The feds will start cutting back on payments they had promised to make.

And that’s just part of the problem. State transportation revenues are also in big trouble. Reason: States use pretty much the same method of finance that the feds do, a per-gallon tax at the pump.

So something is wrong with the gas tax. What is it? It’s the per-unit nature of the tax. Think about it: If you traded a Chevy Tahoe this summer for a Prius, you’re buying many fewer gallons of gasoline to travel the same distance. Hence, you’re paying less in taxes. And even if you didn’t trade in that Tahoe, the gas tax doesn’t keep up with the need. Reason: It’s not indexed. While sales taxes, property taxes and income taxes rise with changes in price, value and income, the gas tax remains flat, dependent on greater fuel consumption for higher revenues.

But even that understates the problem. For reasons that are hard to grasp (the construction boom in China, among others), the price of highway construction has soared in recent years. The Georgia Department of Transportation, for instance, says its road building costs are up more than 40 percent in the last two years.

So put it together: Hyperinflation in construction plus pokey revenue equals crisis ahead. What to do?

States are trying a couple of things to buy time. First, they’re building toll roads and allowing private companies to finance and build new lanes (which are tolled) to bring in additional revenues. Second, they’re shifting more of the cost of construction and maintenance to the local level. A recent study of road and transit improvements in the Washington, D.C., area predicted that, between now and 2030, localities would bear 17 percent of the region’s cost of transportation, up sharply from what a similar study predicted just three years before. “This is the great state shift — or the great state shaft,” the chair of the Fairfax County, Va., board of supervisors complained to the Washington Post.

It’s obvious, though, that these finger-in-the-dyke solutions won’t work for long. The feds and the states must figure a new way of paying for transportation, one that rises with the cost of construction and demand for mobility. What would that be? Good question. Let the brainstorming begin!

Posted November 28, 2006


You Can Get There
The Emerging Downtown Advantage

Since the 1970s, people have been aware of the major geographic changes in metropolitan areas, not just the movement of families to the suburbs (people have been aware of that since the 1920s), but the commercial reordering as well. In the early 1990s, we finally got a name for the clustering of work in the suburbs, “edge cities,” and with that name, a firm understanding that we live and work in regions with multiple business districts. Turns out, though, that some of these places work better than others.

Background: What we learned from the book “Edge City: Life on the New Frontier,” published in 1991, was that unlike residential growth, commercial development (work and retail) doesn’t spread evenly across the landscape; it clusters, mainly around major highway intersections. Hence, Washington, D.C.’s Tysons Corner, Atlanta’s Perimeter Center, Tampa’s Westshore area. These suburban districts were creations of the post-World War II highway construction boom, but they were accidental creations. Nobody set out to create business districts at these intersections; they just happened.

Now, consider what happened with traditional downtowns at the same time. Even as some businesses were leaving, downtowns improved their positions as true transportation hubs. The interstate highway system (for better or worse) sliced through neighborhoods to bring in people from all over the region. Transit systems were started or upgraded to haul people downtown. Where intercity rail was important, the big train station was almost always located downtown. Result: Today, it’s easier in many metro areas to get to downtown than to one of the edge cities. And as congestion worsens, that could be a huge competitive advantage.

You can see the advantage starting to tilt things in the Seattle area, where a new, sophisticated study of commuting times shows that, if you live in Everett on the northern end of the metro area, it takes longer to drive to the edge city of Bellevue than to downtown Seattle, even though the mileage is the same. And downtown’s advantage is growing. That is, congestion is increasing everywhere, but it’s getting worse faster in the suburbs. (You can find the study of Seattle congestion by clicking here.)

Well, if downtowns have such advantages (they were designed as hubs and offer choices for getting to work, including transit), why haven’t they competed more effectively in the past? Because congestion wasn’t as great a problem in the 1980s and 1990s. As the study makes clear, the daily commute has escalated since the 1990s from annoyance to full-blown crisis. (Snapshot: If you set out at 7:40 a.m. on a weekday to drive from suburban Auburn to Renton along Highway 167, a trip of less than 10 miles, it will take more than two and a half hours. In 2003, the same trip would have taken a little more than an hour.) How long will businesses and their workers endure such agony? Not long, we suspect.

Footnote: How can Washington State’s transportation department be so precise about the growth of congestion? Because it buries electronic sensors in highways to measure speed and volume. This is, DOT officials told the Seattle Times, a far better way of measuring congestion than studies that guess what it’s like based on traffic volume and highway mileage.

Posted November 27, 2006


In Some Places, Quite Large
The Size of America's Closet

Which big city has the highest percentage of gays, lesbians and bisexuals? No surprise, it's San Francisco. But several others at the top of the list might surprise you: Seattle, Atlanta and Minneapolis.

That's the order in which cities appear in a new study of gay America by the Williams Institute at the University of California Los Angeles' law school. Given that gays are not always eager to identify themselves, the institute is estimating, based on government surveys. Even so, this may be the best estimate around of where gays live in the U.S.

First, the numbers: 15.4 percent of San Franciscans are gay, lesbian or bisexual, the study says. In Seattle, it's 12.9 percent, Atlanta is close behind at 12.8 percent, Minneapolis is 12.5 percent, followed by Boston (12.3 percent) and Oakland, Calif. (12.1 percent). Sounds like a lot and it is. There are 8.8 million gays in the U.S., the institute estimates, or about 4 percent of the adult population.

But if you look at the places with the highest percentages, you may notice that they are relatively small cities at the center of large metro areas, and that's one reason the percentages of gays are so high: These cities don't take in large suburban areas, where gays are less likely to live. (Hence, Los Angeles and New York are not at the top, even though they have large gay populations.)

In fact, when you look at metro areas, you see a somewhat different order. Yes, San Francisco-Oakland are at the top, followed by Seattle-Tacoma, but they're now followed by Boston, Portland, Ore., and (big surprise) Tampa-St. Petersburg. (To view the study, click here. To find the estimates of individual cities, look in Appendix Two.)

Another interesting finding: The number of same-sex households is increasing very fast, up 30 percent since 2000. This doesn't mean that the number of gays is increasing as fast; rather, researchers told the Seattle Times, it means gays are more comfortable living as couples and disclosing their sexual orientation to government survey takers. "Basically," one told the newspaper, "we're looking at the size of America's closet."

Posted November 22, 2006


Real Change
Baltimore's Nickel-and-Dime Approach to Homelessness

Question: What do you get when you combine the problem of panhandling, the need for financing long-term strategies for dealing with the homeless and a bunch of old parking meters? Answer: a small but ingenious solution.

Baltimore and its downtown organization, the Downtown Partnership, have been thinking a lot about homelessness and panhandling. As everywhere, these are big impediments to downtown renewal (visitors hate walking a gauntlet of panhandlers; residents hate stepping over people camped on the sidewalks). The good news: Baltimore city government is ready to commit itself to the only strategy that seems to work, an approach called "housing first". Better news: The Downtown Partnership has come up with an idea that may cut down on panhandling while helping pay a portion of the expense of programs for the homeless.

That's where the old parking meters come in. The organization has painted some old-style, headed-for-the-scrap-yard meters (the ones that accept only nickels, dimes and quarters) and installed them along busy streets. Rather than dropping a quarter in a panhandler's cup, residents and visitors are invited to deposit it in a "Make a Change" meter. When they do, the meter briefly changes signs, from "despair" to "hope."

How much money will be collected a nickel or dime at a time? Hard to say, since few places have tried this. Probably not a lot. But the aim isn't as much to collect money as it is to change behaviors that hurt cities (people giving to panhandlers). "The idea here," a Downtown Partnership official told the Baltimore Sun, "is to educate the public that it's OK to give, but we want you to give where you're helping to make a change." All the change collected will go to Baltimore Homeless Services Inc., a non-profit that helps steer people out of homelessness.

Footnote: So what is "housing first"? It's a set of programs based on separating the hard-core homeless from those who are down on their luck and treating them differently. The hard core are people so ravaged by drug or alcohol abuse, poor health or mental illness that they will always be wards of the state. The idea is to move this difficult minority into permanent housing where they are surrounded by services that keep them off the streets. Once the hard core are gone, the temporarily homeless become much easier to deal with, through shelters and conventional counseling. Baltimore is one of many cities trying this approach these days.

Posted November 21, 2006


Downtown 2.0
When Center City Hits Warp Drive

Let’s say your city accomplishes everything it hopes for with its downtown. There are lots of expensive new condos, a lively mix of retail and nightlife, a well-functioning transit system, an acclaimed baseball park that fits seamlessly into its surroundings. People aren’t just living and working downtown but traveling from afar to luxuriate in the scene. So what exactly would success look like? It might look like a nightclub in San Diego called Stingaree, where people happily plunk down $350 for a bottle of Grey Goose vodka.

San Diego’s downtown, you see, has hit warp drive. And whether it’s your idea of a good time or not, clearly somebody is having fun there. And spending a lot of money having it.

The latest fad in downtown San Diego, the San Diego Union-Tribune reported recently, is bottle service in nightclubs. That’s where you promise to consume a quantity of very expensive liquor in return for a quick table. (Otherwise, go stand in line.) Average tab for a large party with a couple of bottles of super-charged vodka, mixers, olives, onions and fawning service: $1,600. And the tables sell out nearly every Saturday evening, the nightclub’s owner told the Union-Tribune.

If you’re guessing that this is about something other than conspicuous consumption, you’re right. It’s really about supply and demand. As furiously as entrepreneurs are putting up fancy hotels and nightclubs in downtown San Diego, the demand for a good time is outstripping it. Hence, the need for bottle service to separate the big spenders from the hoi polloi.

Welcome, in other words, to Downtown 2.0, when businesses and downtown officials stop priming the pump and start coping with the gusher. In San Diego, the residential population downtown has nearly doubled in the last six years (from 17,000 to 30,000). And it’s no longer just empty-nesters, the newspaper reported; it’s young professionals — and affluent ones at that.

According to one close observer of San Diego’s housing market, single people now need to make about $75,000 a year to afford a place downtown, and couples need $130,000 or more. And since the vast majority of residents are childless, this gives them lots of cash to spend on, well, $350 bottles of vodka. “The people who live downtown are lifestyle-driven,” he told the Union-Tribune.

And it’s not just residents. Downtown San Diego has become a stopover for affluent weekenders who might have flocked to Los Angeles or San Francisco in years past. “The buzz is that San Diego is [Miami’s] South Beach 10 to 15 years before the boom,” one owner of a hip new hotel told the newspaper.

The Union-Tribune interviewed one of these hipsters, a 26-year-old real estate agent who was celebrating a friend’s birthday by dropping a few hundred bucks at Stingeree. Why party downtown? “Pacific Beach was cool when I was 21,” he said, referring to a nearby surfing beach. “But as you are heading into your late 20s and early 30s, downtown is more sophisticated. PB is good when you only have $40 in your pocket.” Tip: Hang on to that $40, though. After drinking vodka all night, you’ll need it for the cab ride home.

Posted November 20, 2006

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