Can we re-charter our US cities for success?

My company’s headquarters is located in downtown St. Louis. As an urban planner in the new south, my frequent trips to our mothership have granted me the opportunity to explore much of the urbanism, both good and bad, that this region has to offer. And let me say, St. Louis have some absolutely extraordinary urbanism. From historic walkable neighborhoods rich in architectural character to vibrant business districts to its rich cultural amenities, St. Louis provides its residents with the potential for a very high quality of life.

For the outsider, most think that St. Louis, at least the city of St. Louis, extends from the Mississippi River to the Missouri River. And with the airport (as a city facility) located not too far from the Missouri River, this is arguably correct. But in reality, the city itself ends as a corporate entity at the western boundary of the 1200 acre Forest Park. Beyond that lies dozens upon dozens of incorporated jurisdictions including large swaths of unincorporated St. Louis County. I suspect that in years past they simply denoted that area as “beyond this there be dragons.” Today, the population of St. Louis County is nearly three times that of the city but is spread across 91 incorporated jurisdictions.

With a few notable exceptions such as Webster Groves, Kirkwood, University City and Clayton, many of these cities are little more than incorporated neighborhoods with some comprised of just a few streets and houses. Fourteen of these “cities” have less than 500 people with the smallest one (Champ) clocking in with 12 residents.

The result of this “pandemic of place” is evident. Complex taxing structures, municipal inefficiencies, fractured decision-making, and hyper-competitive tax base stealing runs rampant across the area. Some have adapted to these growing costs by creating strategic alliances with neighboring “cities” to contract for services and reduce operating overhead but most are hamstrung by soaring costs (and expectations) and declining revenues.

The question I ask myself every time I visit, which has been more than 50 times over the past decade, is whether a city/county with such great urbanism, can ever be truly competitive in the new economy. And unfortunately, I have yet to come up with a positive answer. This answer has nothing to do with its physical structure which is in many ways far superior to a Charlotte or a Phoenix. Rather, what holds it back from truly being competitive on the national or global scale again is the political structure. By my estimate, the regional probably contributes nearly as many politicians per square mile as Washington, DC. (Assuming a minimum of 5 elected officials per city times 91 cities and the County Council equals 450 plus the City of St. Louis’ 29 alderman and one Mayor for a grand total of 490 elected officials – perhaps someone from the local municipal league can provide a more accurate number). Regardless, even if the number is half of that, it’s still too many to provide a truly competitive region with appropriate representative leadership and effective decision making.

This issue resonated with me on my last trip to St. Louis as I read the current issue of Harvard Business Review. One of the lead stories was a listing of breakthrough ideas for 2010 and coincidentally one of the issues addressed governance and political structures for competitive cities.

Entitled “Creating More Hong Kongs,” Paul Romer, the senior fellow at the Stanford Institute for Economic Policy Research suggests that charter cities can help to change the rules for struggling economies. Focused particularly on the emerging third world, the suggestion was that if a Cuba or an India created a new port city with open-market rules more like Hong Kong than like North Korea, it could help to give a boost to that nation’s overall economy much like Hong Kong’s free-market tendencies have done for the rest of China.

So as I sat there and reflected on the thesis, I realized that the opportunity for a truly new city and not just an extension of an existing urban area, while possible in a place like Dubai or Mumbai with rapidly growing populations, is not likely to produce an overwhelming number of new entrants for the first world which desperately needs a means to reinvent itself to better compete on the global scale. Rather, I wondered if this idea of a charter city could extend to the re-invention of an existing city or urban area. How many communities across the United States are plagued by byzantine bureaucracies that are so ingrained that decision making is more like an Olympic sport than a deliberative, predictable exercise? How many places have tried strategic reform when a more generalized carpet bombing was necessary?

St. Louis certainly isn’t alone in this, though the sheer breadth of decision makers poses a unique challenge. In other areas of the country, particularly the northeast, the levels of government offer a similar conundrum. Just how many county, township, town, and village governments are necessary to manage the exact same populations that are in fact shrinking, not growing. And even if they are growing, is this still the right approach?

Is there leadership, particularly at the state level to impose such a change on areas that are clearly dysfunctional? Cities and counties are, after all, creatures of the state and can be created and dissolved in a single act. And what are the catalyzing events that make such a radical change possible? Does the area have to be so decrepit or abandoned, like parts of Detroit or Buffalo (with apologies to the great areas of both) to bring about this type of change? Even San Francisco, with its beautiful urbanism, is considered by many to be governed by a structure that is one of the most bloated and ineffectual in the country.

All of this brings to me a clear focus that in order for cities to thrive in the new economy they must be much more than beautiful, functional, urban places. They must be well governed, from the individual neighborhoods to the Mayor’s office, without being onerous and contradictory to the future vision. Part of this is a discussion on development codes, but it really speaks more to the daily policies of service delivery and business support that a city is best able to provide.

So, is there hope for the St. Louis and it’s hundreds of tiny body politics to be positioned for the future? Can they effectively set aside their individual tax base needs to compete in the global economy? The current economics of St. Louis appear more like a shell game, simply moving tax base around, often in the form of new retail centers that bleed off the adjacent jurisdiction. And often, these “projects” have been at the expense of population, forcing whole neighborhoods to move in order for “progress” to occur. And to be fair, they are all doing it. To point fingers would be futile because you would be spinning in circles. And with declining population, most economists will tell you that no new revenue is being created - it is simply being moved around from one shiny new big box to the next. And we also come to understand that the St. Louis region is really on the precipice of becoming a shrinking city, a place where population growth is inversely related to land consumption.

How would things be different if St. Louis County were comprised of say, eight to ten cities rather than the current 90 plus? And what if one of those new cities were a charter city with a radically different structure that had previously been imagined before? Because to consolidate and yet to continue the same business as usual is more than a missed opportunity for incremental progress. It might just be a missed opportunity for truly global competitiveness that restores St. Louis to the prominence of centuries past and ensures that we aren't having the same conversation about St. Louis or Memphis or Charlotte in fifty years that we are having about places like Detroit and Buffalo today.

Shrinking Cities: What can we learn from Detroit?

The post below is written by Peter Zeiler who serves as the Transit Station Area Development Coordinator in the Neighborhood & Business Services for the City of Charlotte. He can be reached at pzeiler@CharlotteNC.gov.

Back up in Detroit I spent a lot of time and energy focused around the Shrinking Cities project and discussing the issue with local and global policy makers.

One of the key points missed in planning for a shrinking city is property ownership & control and the costs to actually a policy of shrinking. Disinvestment is not linear or block by block. A city managing decline must rationalize the chaotic decay in order to effect any meaningful change other than the natural entropy – which as we have seen is not a viable model.

The costs to return large tracts of patchwork land in neighborhoods back to natural or agricultural (or even industrial) uses is staggering.

As an example, a project I worked on in Detroit over a seven year period was to basically apply the coup de grace to a dead neighborhood. Out of 1,600 homes in 1940 in the target neighborhood, only about 400 were still standing. 100 of those were vacant, the other 300 were about half owner occupied, 85% were sub-code and the households were largely impoverished. Nearly 700 of the vacant parcels were already owned by the City through tax foreclosure.

The neighborhood was surrounded by industrial uses in a classic pre-zoning land use pattern. The goal was to remove the vestiges of the trapped neighborhood, move the residents to other neighborhoods that had a chance to survive to help stabilize them and then backfill the site. The site would become an industrial / office park with excellent freeway access and tax free status for 15 years through a program known as Renaissance Zones (businesses would be exempt from all non-bonded property tax, utility taxes and all local and state business taxes- and we would sell them the newly cleared land with significant writedowns).

Shorty story – it failed. Miserably.

The cost to relocate households averaged about $150,000 - $200,000 per household despite the fact that their homes were valued generally at less than $30,000. Following state and federal guidelines for eminent domain added significant (and wholly justifiable and ethically correct) expenditures. Then came the task of tracking down and condemning vacant 40’ x 90’ residential lots – at an average expense of $35,000 per parcel.

Once the majority of the site was acquired the physical work needed to be engaged. Because we were demolishing a significant number of structures, the entire site needed to undergo a full EPA analysis – meaning house by house investigation for contaminants which would be part of an overall environmental program. No just bulldozing the home, you had to check each and every one and – for example - mitigate ACMs like linoleum mastics by hand. $3,000 per unit demos skyrocketed to upwards of $60,000 per in some cases. There were significant costs to relocate water, sewer, gas and electrical infrastructure that ran through the site and connected to other neighborhoods. Infrastructure is a network, not a system of nodes that can be switched off arbitrarily and thus creates reengineering and rerouting challenges. Then the vacant land and abandoned streets had to be remediated (lead, arsenic etc in soils, PCB plumes from neighboring uses) and grubbed.

In short nearly $120 million was used to create a 50 acre industrial park - without roads. Recall the Empowerment Zone program of the Clinton era that was to spark urban redevelopment was criticized as squandering tax payer dollars by granting $100 million to each of six cities. The entirety of the Detroit Title IX money could have been consumed and still not been enough for the 50 acres of the site.

The result of all this is a 200,000 square foot JIT (just in time) warehouse facility that employs 60. Even with generous land write-downs and nearly full tax exemption for 15 years, the site did not attract users. There are simply no jobs left in southeast Detroit and no reason to move jobs there. Now if that is the cost for 50 acres, the math for even 10% of the 138 square miles of Detroit would be staggering.

This isn’t to say that the goal is not worthy or that it can’t be done. Flint, MI and Youngstown, OH have moved towards managing decay but they are timid steps still. The concept is viable and no longer groundbreaking in a policy context. The next step that needs to be taken to advance the policy of managed decline is a true accounting of its costs and a national program to address it.

I have a hunch that when people see the cost of managed decline and its non-existent ROI, the costs of regeneration will seem like chicken feed in comparison. If we are gun-shy to spend $100 million in ten years in Detroit for regeneration, how gun-shy will we be for the billions to create forests?

The time has come to move beyond the idea. If urbanists and environmentalists want to move the managed decline argument forward, it’s time to start hanging a price tag on it. It may be that the most compelling argument for sprawl containment and smart growth is the exponentially higher cost of returning developed land back to nature for which we are now beginning to have an understanding of the full and quantifiable costs.

Food for thought.