Houston Mayor: I Do Not Want the City To Participate in Migrant Child Detention

Houston Mayor Sylvester Turner said he would do everything in his power to avoid his city becoming an “enabler” of a new migrant detention center slotted to open in his city, suggesting state and local permitting mechanisms that could stall its operation.

In remarks Tuesday during which he declared his strong moral opposition to a federal policy of separating migrant children from their parents, Turner said his city has not yet approved several permits necessary for the facility to operate, and urged the facility’s operators to “reconsider” their role in its operation.

“There comes a time when Americans, when Houstonians, when Texans have to say to those higher than ourselves: This is wrong,” he said in a press conference, noting that he has thus far tried to avoid the politics of ruffling people’s feathers. “This is just wrong.”

Between May 5 and June 9, the federal government has reportedly separated 2,342 migrant children from their parents, following the Department of Justice’s “zero tolerance” policy, through which the government seeks to detain and criminally prosecuted all adult migrants crossing the border without papers—including those who are seeking asylum.

Many of the kids separated in this process have been housed at facilities meant to be temporary, until the Department of Health and Human Services (HHS) finds them a sponsor family. In recent weeks, the human impact of that practice has come into vivid relief: stories about how traumatized children tucking under drawings of their family under their pillows; audio recordings of kids wailing for their moms and dads, pleading with officers to call their relatives; reports from these facilities of children sleeping in giant cages some have likened to “dog kennels.”

In Houston, an unused warehouse in east downtown is reportedly going to be used as such a shelter. In what Turner described as irony, he said he intended to seek a lease of the facility, which has previously been used to house people displaced by Hurricane Katrina and the homeless, for a long-term homeless operation. It was intended to be a site for not just housing, but the a delivery of free meals and behavioral health services in a county-city collaboration.

“We thought it would be the best way of reducing the homeless population and bringing them together,” Turner said.

Turner said the city was not informed that the facility was being used to house migrant kids, and only found out about the new tenants once reporters and activists got wind and sounded alarm. Southwest Key Programs, the company contracting with the federal government to operate their other child detention centers in South Texas, would also be in charge of the planned one in Houston. On Tuesday, Mayor Turner met with HHS and Southwest Key representatives to confirm this news—and express his disapproval.

“They did say they will provide compassionate care—and let me just say, I do not question their intent,” Turner said. “But I do not support this facility being used for this purpose.”

Turner pleaded with the building owner and contractor to reconsider. “I do believe that as a result of the conversation we had today that they are taking a second look at which direction they want to proceed,” Turner later added.

And he pointed out the many pending steps in the city’s domain before the facility is cleared for business: the fire department’s inspection, the health department’s food and shelter permit, for example. He also noted that the state has not yet licensed the facility, either—imploring it not to do so.

“I do not want to be an enabler in this process. I do not want the city to participate in this process,” he said. “I don’t want our facilities and property owners to participate in this process.”

Asked if there was any realistic way he could stop the facility from opening, Turner stated again that the fire department has not yet approved the facility, adding that its chief is with him 24/7. “So I don’t plan to get over there right now,” he said, hinting at how he might slow-walk that approval. With regard to the health department’s shelter approval, he said the city wants to be “meticulous” in evaluating the facility, given that it would be used for children.

“I don’t want anyone to criticize me for moving too quickly or in haste because others may have moved in haste on this policy so we’re going to take the necessary time to make sure that we are prudent, that we are efficient, and we take every conceivable step that is in the best interest of the kids in this facility,” he said.

On June 21, mayors around the U.S. plan to descend on Tomatillo, Texas, to protest the federal government’s child separation policy, following a resolution they passed urging the Trump administration Congress to do the same at a recent U.S. Conference of Mayors gathering. In addition, the mayors are putting together a list of steps they can take in their backyards in the coming days, after surveying the situation near the Southern border.

”We are assessing what local tools we have in our toolbox of practical things we can do,” said Mayor Steve Benjamin, of Columbia, South Carolina and president of the Conference. “Is it possible we can set up a tracking system so the children could find out if and when their parents are deported? Can we arrange for on-site counselors and childcare workers? Can we help fund immigration lawyers for parents and children, so they have access to counsel?”

In Houston, an unused warehouse in east downtown is reportedly going to be used as such a shelter.

It remains to be seen how far these policies go, but at least for now, mayors are using some strong words to galvanizing local support.

“The day that we as Americans sanitize or anesthetize ourselves to behaviors and actions and policies is the day that we are all in trouble. So let’s be very careful that we not say we will leave it to the policymakers to change the policy,” Houston Mayor Turner said.

“We are the policymakers. We are the people.”

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Nothing Is ‘Sexier’ Than Building a Highway Over the Everglades

Miami’s Kendall Parkway extension: another sexy highway. (TransitAlliance)

In Florida, infrastructure and wildlife are frequently paired in name. There’s Alligator Bridge and the Bridge of Lions; a Turtle Parking Lot, an Armadillo Avenue, at least a few Snake Roads.

There’s also the Dolphin Expressway, also known as State Road 836, a 15-mile, six-lane, tolled expressway that runs east to west through Miami-Dade County. Since 2014, local officials have been discussing a 13-mile, $650 million extension of 836 to serve the community of Kendall, a notoriously traffic-jammed part of the county. On Wednesday, commissioners will vote on whether to send the latest proposal for the “ Kendall Parkway” from the Miami-Dade Expressway Authority, which would manage the new road, up to Tallahassee for round one of state approval.

This draft offers two potential routes, both contentious. One is pressed against the county’s urban development boundary, which is designed to prevent further sprawl into the Everglades, the ultra-fragile wetland habitat and critical watershed. Many Kendall residents are supportive of that plan, expecting it to shorten their commutes, but don’t all love the idea of a multi-lane highway so close to their homes. So the MDX came up with a second proposal that sends the new road about a mile further west, outside the urban development boundary—and straight through what’s formally known as Bird Drive Basin, i.e., “the flowing heart of the Everglades’ famed River of Grass,” as the Miami Herald put it.

Smart-growth advocates and environmentalists are displeased with both ideas, which would seem to encourage growth ever closer to the imperiled Everglades. More lanes also won’t solve congestion, as a matter of science. Induced demand, as CityLab readers may know, is a bedrock principle of traffic engineering. Road space and peak-hour congestion have a one-to-one relationship on urban expressways; when one grows, so does the other. “Our traffic problems aren’t going to be solved by adding more highway and, by the way, paving over wetlands that are going to recharge our groundwater,” Celeste De Palma, the director of Everglades policy for Audubon Florida, told the Herald last week. “That just seems crazy.”

Miami-Dade Mayor Carlos Gimenez, an outspoken supporter of the Dolphin Expressway extension, disagrees. When one woman stood up at a public meeting in West Kendall on Monday to point out that induced demand is real, Gimenez reportedly responded, “That’s one of the dumbest things I’ve ever heard.” He has repeatedly fought efforts to expand transit across Miami-Dade County, despite running twice on pro-rail mayoral platforms. The regional Metrorail system is suffering from a shrunken budget, service cuts, and decaying rolling stock. Back in 2002, county voters approved a half-cent sales tax to pay for 88 more miles of track and 635 new buses. But instead of funding transit, that money has essentially turned into a slush fund for road projects, according to Streetsblog.

Meanwhile, Gimenez has become somewhat of an evangelist for autonomous vehicles, arguing that cheap and convenient on-demand rides will make transit a thing of the past. For a moment, it seemed as if Gimenez might get on board with “trackless trains,” (that is, autonomous buses), but it seems that time has passed. On Tuesday, responding to a tweet characterizing his remarks at the West Kendall meeting as an “attack,” Gimenez tweeted, “There has been no ‘attack’ … simply [stating] facts.”

Sexy highway, Miami! (TransitAlliance)

So what is the larger justification for more highway? According to TransitAlliance, a local transit advocacy group, it’s just what’s politically sexy. On Monday, the organization launched an online campaign against the Kendall Parkway plan at www.anothersexyhighway.com. It’s a parody of a dating-site profile, fake-hosted by “MDXXX.” Although you can’t swipe, you can scroll through “cards” that primp up the project’s flaws in tongue-in-cheek language. “While other cities invest in more transit, better transit, and free pre-school (yuck!), our toll money is designed to do one thing and one thing only—generate more toll money, for more sexy highways!” reads one. “Trapping everyone in cars forever means more traffic, and more tolls—it’s a win-win!” There’s even a sexy highway song that plays in the background.

You may remember TransitAlliance from other clever online campaigns in support of Miami-Dade riders. In February, they built a real-time Metrorail “audit” that displays trains that fail to arrive as scheduled. After that, they crafted a suite of data visualizations that showed the county’s “dismantling of the bus system.” Marta Viciedo, the co-director of TransitAlliance, said that there was so much wrong with the Dolphin Expressway extension proposal that it couldn’t be expressed forcefully enough with mere statistics. Her hope is that the somewhat clickbaity campaign will reach outside the usual choir of transit supporters and get more Miamians writing letters and making phone calls to elected officials protesting the extension before this vote (which won’t be a final decision) and potentially the next. “The idea was to do something a little more lighthearted and make fun of something that’s a little ridiculous to be happening in the first place,” she said.

When it comes to wildlife and development in Florida, those shots seem to come easily. The Sunshine State was declared a global biodiversity hotspot in 2016, with more endemic flora and fauna than anywhere on the North American coastal plain. Quite a lot of it endangered. One can suppose it’s an expression of local pride to slap the name of species on so many roads and highways. But what kind of pride names the asphalt after the animal whose habitat is getting paved over? It’s a bit like the highway version of housing developers who name their subdivisions after the natural features they’ve erased. Extended further, the Dolphin Expressway would look more like a trophy.

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Grenfell’s Problem Wasn’t Just Lax Regulation

The Grenfell tragedy in which 71 people died a year ago was a shocking reminder of a worldwide problem: When buildings burn down and lives are lost, the media rehashes well-trodden narratives that shame landlords and the municipal inspections that are supposed to keep them in check. This is usually followed by calls for more safety inspections. But this is the wrong way of addressing the problem: a case of too little, too late.  

Instead of simply increasing regulation and inspections, governments must remove the opportunity for exploitative profit by insisting on rent controls, providing subsidies for necessary repair work, and re-upping their role—both in ownership and management—of housing, before we are dealing with dire situations.

In addition, my research shows that if municipalities do not invest in housing, even the best of intentions can perpetuate housing inequality. I learned this after three years of researching housing inspections in Chicago. Consistent with other studies, I saw inspectors’ ire at negligent landlords. One inspector told me that after his 20 years of inspecting deplorable living conditions, he prays for some landlords to go to “landlord hell.”

Inspectors act on their anger by doling out as many building code citations as possible and insisting that landlords fix them. Quantitative analyses of ten years of citation data back this up: Inspectors give out more citations to large rental properties that they think are poorly managed. They do try to penalize bad landlords.

But my research also illuminates the unintended consequences of these well-intended actions: rent hikes. My statistical analysis of over 280,000 building code citations and five years of rental data verifies that every citation and violation that is then fixed is associated with a 5.4 percent rent increase, a number that is consistent when normed across properties of the same age, size, value, and neighborhood.

I went on a housing visit with an inspector who ended up citing a landlord for 35 violations, ranging from sparking electrical outlets to a dangerous porch. If these get fixed, my analysis predicts that the landlord would raise the rent from the current amount of $750 to $926 by next year. If the landlord fixed none, the rent would only increase to $771 (based on the average increase for that part of the city). Landlords raise rents to cover the costs of citations.  

When good intentions have inadvertent effects, these effects are not dispersed evenly. Low-income and minority tenants are both the most likely to live in poor housing conditions (as demonstrated by a wealth of other studies), and thus also most vulnerable to suffering the brunt of the unintended consequences that my research reveals. Introducing proactive rental inspections—aimed at cracking down on bad landlords—risks making this issue much worse.

To be sure, not insisting that landlords fix up properties is also bad for tenants. But my research shows that many people have it wrong about whose side municipal inspectors are on.

While inspectors can be unsympathetic to tenants, if we consistently ascribe poor motives to inspectors, there is little hope of securing their efforts to improve housing. By misconstruing inspectors’ actions, housing organizations and activists cannot accurately capture how inspections work and are unlikely to be able to effect progressive change at the municipal level.  

This is not just about Chicago. Other cities face similar patterns in a dearth of affordable housing, aging housing stock, subpar housing conditions, racial disparities in housing inequality, rising costs of construction, and calls for increased regulations. We can use these lessons learned from Chicago to effect change in other cities too.

Yes, investing in housing will cost money. But new proactive inspections won’t come cheap either. Housing activists could lobby governments to invest in housing instead of calling for increases in its regulation. Additional regulation—even if well-intended—will only perpetuate housing inequality, unless municipalities remove the opportunity for exploitative profit by insisting on rent control and providing subsidies for necessary repair work to existing housing. Governments need to choose investment as an alternative path to increased regulation. Most fundamentally, municipalities must invest in housing. Investment could mean subsidizing repairs, rent controls, or building and managing more state housing.  

Though it may seem easier to increase regulations, we should do the hard work now and figure out which kinds of investments make most sense in various communities. Many cities are debating a proactive rental inspection ordinance, as cities realize current housing inspections are incapable of preventing poor housing and negligent landlords. But this new well-intended legislation is also doomed to perpetuate housing inequality, unless municipalities invest in housing itself. We need to invest now.

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I Survived D.C.’s First ‘Sweat Crawl’

It hurts to laugh, but then, there’s not much to laugh about. It even hurts to writhe in pain, and of that, there is plenty.

In a cruel twist to the lyrics of the Beyoncé song, , explaining Ehrenreich’s argument:

Like workout culture, wellness is a form of conspicuous consumption. It is only the wealthy who have the resources to maintain the illusion of an integral and bounded self, capable of responsible self-care and thus worthy of social status. The same logic says that those who smoke (read: poor), or don’t eat right (poor again), or don’t exercise enough (also poor) have personally failed and somehow deserve their health problems and low life expectancy.

Being mindful of that, I settled into a series of stretches and restorative poses—guided by a slender man with the sensual, somber air of a ballerina. That day, he wore cream-colored nail paint, and a bunch of japa malas around his wrist. I’d taken his class before, and had quite enjoyed it—I’d appreciated his focus on administering a challenging sequence instead of doling out Hindu philosophy. The latter can be a tad awkward if you’re the only Indian person in class. At the end of our 30-minute session, he bid us “namaste,” as is customary in American yoga classes. (In India, “namaste” is something one says to a nosy neighborhood auntie or an elderly visiting relative.)

I responded by silently folding my hands in gratitude.

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CityLab Daily: Why Ford Sees a Future in Detroit’s Old Train Station

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What We’re Following

Motown classic: In recent years, American automakers have been rebranding as “mobility” companies, pitching a more communal future of transportation… so of course Ford bought a train station. With the acquisition of the Michigan Central Station in downtown Detroit, the company is putting a physical stake in the city’s future.

In four years, the 1913 Beaux-Arts depot that saw its last train depart three decades ago will become the central hub of Ford’s 1.2 million-square foot corporate campus in the neighborhood of Corktown. But the company’s downtown presence isn’t just a perk to attract a younger workforce; it’s also a test ground for autonomous vehicles. CityLab’s Laura Bliss has the story: Ford’s Detroit Investments Are Bigger Than a Train Station.

Andrew Small

More on CityLab

We Can Create Better Jobs—by Fixing the Bad Ones

More than 65 million Americans toil in insecure, low-paying jobs. Instead of hoping they will all find different, and better, jobs, we should upgrade the ones they already have.

Richard Florida

More Than 300,000 U.S. Homes Could Flood Regularly by 2045

A new study finds that at the high end of predicted sea-level rise, many thousands of homes in the U.S. could flood 26 times a year.

Oliver Milman

Mass Incarceration’s Complex Statistics

A new study from the Vera Institute of Justice says that we should look closely at the populations, and relationship, of local jails and state prisons.

Teresa Mathew

Water Cremation Could Change the American Way of Death

Some people see “aquamation” as a greener—and gentler—way to treat bodies after death, but only 15 states allow it for human remains.

Emily Atkin

The Story of South Dallas in the Cover Art of Nas’ New Album

A photo of five young black boys holds the story of drugs, racial segregation, and despair in South Dallas.

Brentin Mock

Burden of Roof

You already knew the rent was too damn high, but how long has that been the case? Harvard’s Joint Center for Housing Studies finds in its latest State of the Nation’s Housing report that the gap between rents and renter income has been growing for a long time. The yellow bars on this chart show that the share of households that are burdened by housing costs has doubled since the 1960s—from 23.8 percent then to 47.5 percent in 2016. And the affordability gap is far from making ends meet: Adjusting for inflation, the median rent payment rose 61 percent between 1960 and 2016, while the median renter income grew only 5 percent during the same time.

CityLab context: If rent were affordable, the average household would save $6,200 a year

What We’re Reading

How the Koch brothers are killing public transit projects around the country (New York Times)

Black families were pushed out of Portland. Can this program bring them back? (PBS NewsHour)

U.S. housing market continues to rebound, despite increased inequality (Curbed)

Climate change-related heat waves will be deadly for people who are homeless (Slate)

South Bend’s “Mayor Pete” gets married, takes his husband to a parade (New York Times)

Tell your friends about the CityLab Daily! Forward this newsletter to someone who loves cities and encourage them to subscribe. Send your own comments, feedback, and tips to hello@citylab.com.

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We Can Create Better Jobs—by Fixing the Bad Ones

When politicians and pundits talk about creating better jobs, they typically cite two strategies. The first, emphasized by economic nationalists and populists like President Trump, is to use trade and other policies to bring high-paying manufacturing jobs back to American soil. The second, emphasized by progressives, is to use education to prepare less advantaged workers for higher-paying jobs.

But even if we did both, we would not put a significant dent in the jobs problem. The reality is that high-paying knowledge jobs employ just a third of the workforce, and only 5 or 6 percent of Americans do manufacturing work. Even with the unemployment rate at less than 4 percent, more than 65 million Americans—almost half of the entire workforce—toil in low-paying jobs in fields such as food service, retail, and personal and health services.

The only real solution to America’s jobs problem is to make these currently low-paying and precarious service jobs into better, higher-paying jobs.  

In a new study that I conducted with economists Todd Gabe of the University of Maine and Jaison R. Abel of the Federal Reserve Bank of New York, we examined the year-to-year transitions (e.g., keep the same job, become unemployed, move into a better job) of workers in low-wage jobs. We tracked the employment situation of these workers between 2011 and 2017, the period of the economic recovery.

We also created an index of job quality that accounts for average hourly wages; whether the job provides a standard 40-hour work week; the likelihood of benefits; and the prestige, or social desirability, of the job, as determined by previous academic studies. Using this index, we divided America’s employment landscape into four distinct quartiles, from high-paying, good jobs to low-paying, low-quality jobs.

Our overall findings are disturbing. Just a small fraction of low-wage workers move into occupations that offer a path to higher wages and a better life. America’s low-wage workers are more likely to become unemployed than to move up the economic ladder.

America’s bad jobs—that is, those in the lowest quartile—pay an average wage of $13 per hour. They deviate by an average of seven hours from a 40-hour work week and provide benefits for less than half of those who hold them. (By contrast, the highest quartile of workers has an average wage of $37 per hour and deviates from the average work week by about three hours; 90 percent of the workers in this group have benefits.)

Workers in the lowest quartile are significantly more likely than those in the other quartiles to become unemployed or exit the workforce after one year. They are also much less likely than even those in the second quartile to move up the economic ladder, demonstrating the extent to which low-wage workers are stuck at the bottom of the economic spectrum.

(Florida, Gabe & Abel)

Almost 7 percent (6.7 percent) of America’s low-wage workers become unemployed within a year, which is nearly four times the rate for high-wage workers (1.8 percent). Low-wage workers exit the labor force at a rate of more than 10 percent per year, nearly three times the rate of high-wage workers. And low-wage jobs are the least stable; low-wage workers are the least likely to stay in their jobs and the most likely to switch jobs.

Even more troubling, just 5.2 percent of low-wage workers are able to upgrade to a higher-quality job in a given year. (Of this 5.2 percent, 2.9 percent move into a second-quartile job, 1.7 percent into a third-quartile job, and just 0.6 percent into a high-wage job.) By contrast, 91.3 percent of high-wage workers either remain in their job or get another high-paying job.

Which higher-quality jobs offer workers the best chances for doing better?

As the chart below shows, truck drivers are the big outlier here, as the occupation with the largest share of workers who transitioned into better jobs. Other occupations that provide low-wage workers a good shot at doing better include nursing aide, wholesale and manufacturing sales representative, customer-service rep, secretary, and administrative assistant.

(Florida, Gabe & Abel)

While these job types might help people move up the economic ladder today, not all of them will be a long-term source of economic mobility. Secretaries and administrative assistants, for instance, are steadily being replaced by new software applications. Eventually, truck drivers will likely be replaced by autonomous vehicles. The job types with better long-term prospects are those that involve people skills, including communication, presentation, and organization.

There is a wide range of factors that make it hard for low-wage workers to move up. The chart below focuses on one of the most important, education. Having a four-year college degree or higher is associated with a 7.4 percentage-point increase in the likelihood of finding a better job. That likelihood increases more modestly for those with two-year college degrees or some college. Education is also negatively correlated with becoming unemployed or leaving the labor force.

(Florida, Gabe & Abel)

Age is a significant factor, too. A 20-year increase in age is associated with a 6 percentage-point increase in the likelihood of remaining in the same job over the course of a year. Younger workers might be more willing to experiment with different job types, or might accept a low-wage job with the expectation of moving up the economic ladder later. Older workers are likely more risk-averse, opting for the stability that seniority brings—even in a low-wage job—over the opportunity to find a better job.

While it is important to develop new and better approaches to expand education and improve workers’ skills, these alone will be sorely insufficient to solve America’s low-wage-job problem. In the past, manufacturing jobs offered family-supporting wages to the less skilled and less educated—people like my own father, with a seventh-grade education.

Those jobs were not always good jobs. We made them good jobs, through labor laws and unionization, among other things. As my father often reminded me, when he started work during the Great Depression, it took nine family workers to make a living wage. But when he came back from his service in World War II, the very same job in the very same factory enabled him to get married, buy a home, and put my brother and me through college.

It’s not as if service jobs are damned to be low-wage occupations forever. Indeed, as MIT’s Zeynep Ton has shown, they are amenable to the same kinds of upgrading as manufacturing work. Companies that implement what she calls a good jobs strategy, paying workers more and involving them more deeply in their work, are likely to see a combination of higher productivity and better customer service, which leads to higher profits.

An under-appreciated way to solve America’s jobs problem and rebuild the middle class is to turn the millions upon millions of low-wage jobs we actually have into better, higher-paying ones.

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Ford’s Detroit Investments Are Bigger Than a Train Station

In recent years, several of the largest automakers in the U.S. market have rebranded as “mobility” companies. To varying extents, General Motors, Toyota, Ford, Daimler, and BMW have promised shareholders their participation in creating the autonomous, cloud-connected, and he’d like to see the ground floors converted into a public space filled with shopping, dining, and urban bustle. “We really want this to be a hub of life for this part of town,” he told the Times. On the timeline of progress for downtown Detroit’s revitalization, one columnist for the Detroit Free Press called Ford’s announcement “the city’s biggest comeback moment yet” and “a turnaround of miraculous dimensions.”

Though Ford’s electric and autonomous vehicle subsidiary will be based at the Corktown campus, Hackett said that he hopes that employees will move between there and the company’s Dearborn headquarters, which is also slated for an overhaul, as well as its Ann Arbor location, close to the University of Michigan’s self-driving vehicle test grounds. Business teams should not be siloed from one another, Hackett said; he gave the example that a truck engineer working on F-150s in Dearborn might need input from a “smart” software engineer working in downtown Detroit. The funds to expand in Corktown will come from the estimated $1.2 billion already planned for the Dearborn changes.

The move into Detroit aligns Ford with other companies looking downtown for their new and future footprints in order to attract a younger workforce that values a central location. Google, Microsoft, and Facebook have all carved out prominent space in San Francisco and Manhattan, even as they’ve kept their flagships in Silicon Valley. Older companies have also joined the urban migration in the hopes of shedding their images of suburban, nine-to-five stalwarts. General Electric is in the process of relocating to Boston from Fairfield, Connecticut, while Aetna flirted with pulling up stakes in Hartford for a move to New York City. McDonald’s has shifted its headquarters from an Illinois suburb to downtown Chicago.

For a “mobility” company, though, a downtown presence isn’t only a human-resources perk; it’s also a product test ground. Last year, Ford invested $1 billion in Argo AI, an autonomous vehicle LiDAR developer. In January, it purchased Autonomic, a cloud-based digital platform for managing transportation systems, and TransLoc, a startup that builds software for streamlining urban transit. Launched in 2016, Ford’s Smart Mobility segment has also worked closely with city governments around the world to develop products designed to solve local transportation snags directly. Over the past two years, Ford made forays in ride-hailing and bikesharing services in San Francisco and autonomous vehicle testing in neighborhoods in Miami and Ann Arbor. Earlier this month, it launched a “City of Tomorrow” competition in Pittsburgh, where it will draw ideas from locals about how their daily travel experiences could be improved.

“It’s time to bring streets into the sharing economy,” Hackett declared in his keynote address at the Las Vegas tech convention CES earlier this year, where he talked about the company’s various efforts to spread “smart” parking technology and cloud-based transportation systems.

Streets are already shared, of course, since they are public property. And not all communities have welcomed the penetration of connected sensors and “smart,” demand-based mobility offerings from companies like Alphabet, Uber, Microsoft, and other tech heavyweights. Advocates and public officials have reason for concern that the future of automobiles may be a lot like its past with respect to how they’ll shape cities. Just as 20th-century automakers lobbied for the creation of the highway system, which plowed through neighborhoods and divided cities, the industry’s efforts to wring profit from urban streets today may further inflate the influence of private sector on public space.

Will Corktown residents happily invite product testing in their community? Hackett told CityLab that the company plans to work with residents and business owners in the neighborhood to learn about how the company’s present and future offerings could help them. Detroit Mayor Mike Duggan has been supportive, he added. “We want to make this a community-based experience,” Hackett said. “The city is really excited because they get to pioneer in ways that relate to transportation, too.”  

But it also remains to be seen whether Ford’s buzzy cocktail of future-mobility tech adds up to a winning business strategy. During the first quarter of 2018, the company’s “Smart Mobility” arm, which includes its autonomous vehicle projects and city solutions initiatives, reported $102 million in losses during the first quarter of 2018, Forbes reported in April. That segment lost about $300 million for the full business year of 2017, the company said in January. Profits are slumping at the country’s number-two automaker, which has struggled with the rising cost of critical manufacturing materials and internal inefficiencies. In April, Ford announced that it planned to discontinue most passenger cars from its U.S. catalog by 2020 and will focus on new trucks, S.U.V.s, and electric vehicles in order to drive up margins.

That renewed emphasis on F-150s and the like has also raised questions about Ford’s stated commitment to shrinking carbon emissions from the transportation sector, which the company often relates to their “city solutions” projects. So has the company’s appeal to President Trump, alongside other major automakers, to revise federal auto emissions standards. But Hackett insists that it is all of one strategic piece. “The industry has made tremendous progress,” he said. “Electric vehicle technology is coming in faster than we thought and the promise of connectivity is that we can get rid of more traffic and waste.” Now, Detroit will have a major stake in the bet that that holds true.

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Thinking About a P3? Better Ask These Questions First

The City Accelerator cohort on Urban Infrastructure Finance focused on innovative tools, models and revenue sources that can help cities across the country address their infrastructure challenges, while promoting equity for diverse communities and incorporating the realities of climate change. In this series, we will explore some of the ways in which cities can allocate infrastructure project risks to the private sector through innovative use of public-private partnerships (P3s). Part 1 focused on the reasons cities might decide to pursue (or not pursue) P3s for a given project. In Part 2, we explored some common (and less common) P3 models. In our final installment, we share the evaluation process being used by one cohort city, Washington D.C., to explore how P3s can help solve its infrastructure needs.

Over the past few decades, Washington, D.C., has experienced the kind of growth that most other cities would envy. More than 1,000 new residents move to the District each month, and tourism is at an all-time high.

Residents old and new, as well as visitors, expect urban infrastructure to keep up with demand. But while D.C. government has invested billions in housing, schools and transportation, the city faces a structural deficit and a debt cap that will likely be exhausted in the next few years. Combined with uncertain revenues from the federal government, D.C. – like many large cities across the country– is looking to deliver innovative projects efficiently and effectively, maximizing limited dollars for the benefit of its residents.

D.C.’s Office of Public-Private Partnerships (OP3) was launched in November 2015 to serve as the clearinghouse and procurement adviser for other city agencies seeking to utilize P3 models. As a member of City Accelerator’s cohort focused on creative approaches to infrastructure finance, OP3 is developing a strategy for identifying P3 opportunities, working with other District agencies to prioritize projects, and selecting an appropriate P3 model that maximizes innovation, quality and equity.

OP3 is still fairly new, and its approach to evaluating P3 projects is continuously being refined. The following describes the stages of a typical project evaluation, but these steps are iterative and would be customized or adjusted based on a project’s type, scale and objectives. OP3’s Guidelines, which are publicly available online, go into greater detail on the formal steps and criteria they consider for the high-level screening of projects.

The Initial Screen

OP3’s project-screening process includes a realistic assessment of the project’s goals and objectives. This could begin with an evaluation of the relative importance of the asset. Does the project address a critical infrastructure need for residents? Is this project driven by need for a new asset, or the condition of something that already exists?

If the project seems to align with overall city policy, the next set of questions relates to feasibility. Is there a funding source (either from a new revenue stream, capitalizing underutilized value, efficiency savings or general fund budget) to support the project for its entire lifecycle? Would the project generate revenue of its own? An early stage cost estimate and broad scope of work should be completed for the project. A preliminary value-for-money (VfM) analysis compares estimated costs against the expected economic and social benefits of a project, and provides a basis for prioritizing the project among others under consideration.

Determining whether a project could be a good candidate for a P3 may boil down to an assessment of risk. OP3 reviews the types of risks the District is best positioned to retain versus those that it believes can be more cost-effectively mitigated by transferring to a private partner in a P3 project. But, as discussed in previous installments of this blog series, this transfer typically requires higher upfront costs (resulting in long-term savings if properly allocated to the private partner) and more managerial oversight.

A potential P3 should be of sufficient size, scale and complexity to justify these higher costs; the threshold will vary by location and type of project. A large-scale project typically entails more (and more severe) risk that a city may want to explore transferring to a private partner. Smaller projects may not justify the higher transaction costs of a P3 procurement, but could also be opportunities to pilot innovations with limited exposure to risk. If a standalone project doesn’t seem large enough to justify a P3, consider whether the project could be bundled with other, similar projects in a single procurement (e.g. the renovation of a group of school buildings).

The agency who will ultimately “own” the project should have the capacity and capability to effectively manage the procurement. At the same time, if a city doesn’t have much experience completing or maintaining similar projects in the past, or if previous efforts have gone awry, the project may be a good candidate for a partnership with the private sector.

OP3 also examines whether similar types of P3 projects have been done elsewhere, and what lessons or best practices were learned. The market should be studied to ensure a sufficient level of interest from qualified bidders. Typically, a city’s ability to enter into a P3 is governed by state law.

The Intangibles

Equity is another important dimension to infrastructure finance decision-making, whether considering a P3 or any other type of transaction. Increasingly, cities in the US are wrestling with the consequences – intentional and unintended – of structural racism and economic inequality. Applying an equity lens to P3 prioritization means understanding whether the project could benefit underserved populations and communities, creating pathways to jobs, income and wealth for city residents and closing gaps among racial and socioeconomic groups. Cities should assess whether significant aspects of the project could be provided by minority- or women-owned firms; in fact this is an articulated requirement of many public sector procurements.

Political feasibility should be evaluated early and often. Unlike a formal cost-benefit assessment, there’s no formal methodology for taking a community’s temperature and judging support for a major infrastructure project. It is essential that cities convene the relevant stakeholders – residents, labor unions, the business community and others – and discuss the potential impacts of a project generally, and a potential P3 specifically. Would residents need to pay user fees for something they currently receive without charge? Would privatization mean a reduction in public sector jobs? Would private funding create new opportunities or unlock innovations to benefit city residents? Listen carefully and gauge residents’ support. Ensure that citizens affected by a major project – those who benefit and those who may be inconvenienced – feel empowered to contribute their ideas meaningfully and that their concerns are addressed thoroughly. A robust community engagement process requires more time and effort upfront, but typically makes any project – especially a complex public-private partnership– more likely to succeed.

Red Light, Green Light

If the project seems feasible, the political and social risks seem minimal, and a P3 structure seems desirable, a VfM assessment can reveal whether the benefits of a P3 would be greater or less than a traditional public sector procurement. Many laws governing P3s require this type of comparison. At this point, it should become clear whether a P3 model is preferable to its public-sector comparator. If so, it can be added to a running “pipeline” of projects that could be feasibly advanced as a P3. Projects should be prioritized within the pipeline based on policy objectives, an analysis of infrastructure needs and a review of market conditions. The pipeline should be reviewed and refreshed regularly, and projects should be advanced to the formal procurement process as timing and other conditions allow.

From here, OP3 can develop an Request for Information (RFI) to solicit information and insight as well as market interest from the private sector regarding a potential P3 project. The information gleaned from the RFI, which is typically used for more complex or novel projects, may be used to build a Request for Qualifications (RFQ), through which potential bidders can establish their qualifications for the project. Responses to an RFQ may be helpful in refining the project scope, financing structures and project agreement requirements. At this point, the city can issue an RFP to pre-qualified bidders, and select the proposal that offers the greatest value and potential for innovation and project success.

Wrapping It Up

Public-private partnerships have increasingly become a part of the local government infrastructure toolkit. They are being used to deliver large-scale capital projects that remake entire neighborhoods, and less-visible, but essential, “smart city” technologies that have the power to transform our relationships with the cities in which we live.

Cities around the country are searching for new ways to use limited resources and address critical infrastructure needs, from transportation and housing to resiliency and emerging technologies. The emerging use of P3s by cities, including D.C.’s OP3, will reveal many best practices, key considerations and adaptable strategies in the coming years that will hopefully help local policymakers better align their capital budgets with their capacities and goals.

This piece was originally published on Governing.com.

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CityLab Daily: How Do You Fix the Bus? We Asked the Drivers.

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What We’re Following

Driver knows best: Bus drivers observe a city from a unique vantage point. They interact with riders more directly than train drivers, and constantly navigate the busy streets. So who better to ask about redesigning New York City’s buses than the people behind the wheel? A survey of 373 Brooklyn bus operators did exactly that, and the drivers have some ideas that could not only make their daily grind easier, but could also improve service and win back riders. Read the latest in CityLab’s Bus to the Future series: How Do You Fix the Bus? We Asked the Drivers.

Courtside: The Supreme Court punted on two closely-watched partisan gerrymandering cases on Monday (New York Times). Justices asked a lower court to reconsider a challenge to a Wisconsin congressional district map and ruled against a challenge to a district map in Maryland with an unsigned opinion. CityLab context: How Gerrymandering Is Containing City Power

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