All posts in “Featured Work”

Mayors Rebuild Puerto Rico

June 28, 2018 / Comments Off on Mayors Rebuild Puerto Rico

On September 20th, 2017, Hurricane Maria made landfall on Puerto Rico. Electricity was knocked out across the island and the accumulated damage was widespread and unprecedented. Already burdened with weak physical and economic infrastructure, the island is still struggling to restore basic services and recover from the staggering storm-related death toll, which is in excess of 4,600 lives.

 

To support those on the front lines of recovery, HR&A has partnered with the Open Society Foundations to design, manage, and execute the Mayor Exchange, a peer exchange and technical assistance program to improve the capacity of and resources available to Puerto Rico’s mayors. Through the exchange, we have matched 14 mayors from the US mainland with 14 Puerto Rican mayors to create a network of support through knowledge sharing and a series of reciprocal visits.

 

The Exchange also facilitated two day-long technical assistance workshops to build the capacity of Puerto Rico’s mayors and municipal staff on topics such as resiliency planning, fiscal health, and economic development.

 

 

HR&A’s is honored to be leading the charge on this work. “We are already making an impact,” says partner and lead of the Inclusive Cities practice, Andrea Batista Schlesinger, “influencing the ways Puerto Rican cities think about resilience, bringing mayors across party lines together for the first time to advocate for their interests, and offering technical assistance that would otherwise be unavailable. It’s work to be proud of, but the needs are so profound that we are but scratching the surface.”

 

The Exchange is co-chaired Mayor Pedro García Figueroa of Hormigueros, Mayor Javier Jiménez Pérez of San Sebastián, and former Mayor Mitch Landrieu of New Orleans, whose deep understanding of the important role that mayors play in leading their cities through recoveries from disaster has been an invaluable resource to this program. See below for the list of mayors matched to date.

 

 

Puerto Rico Mainland US
José Santiago Rivera, Comerío Rahm Emanuel, Chicago, IL
Roberto Ramírez Kurtz, Cabo Rojo Gary McCarthy, Schenectady, NY
Nelson Torres Yordán, Guayanilla Jorge Elorza, Providence, RI
Ángel Pérez Otero, Guaynabo Tom Tait, Anaheim, CA
Pedro García Figueroa, Hormigueros Mike Duggan, Detroit, MI
Carlos Delgado Altieri, Isabela Stephen Hagerty, Evanston, IL
Julia Nazario, Loíza Rahm Emanuel, Chicago, IL
Jesús Márquez Rodríguez, Luquillo Chris Cabaldon, West Sacramento, CA
Jorge Márquez Pérez, Maunabo Catherine Pugh, Baltimore, MD
María Eloisa Meléndez Altieri, Ponce Mitch Landrieu, New Orleans, LA
Carmen Yulín Cruz, San Juan Jim Kenney, Philadelphia, PA
Javier D. Jiménez Pérez, San Sebastián Mark Stodola, Little Rock, AR
Bernardo Márquez García, Toa Baja Paul Soglin, Madison, WI
Luis Javier Hernández Ortiz, Villalba Ravinder Bhalla, Hoboken, NJ

 

Interested in learning more about the program? Contact Partner Andrea Batista Schlesinger.

Better Incentive Policy

November 20, 2017 / Comments Off on Better Incentive Policy

Today, cities across the United States use incentives to drive job creation, capital investment in buildings and infrastructure, and neighborhood revitalization. For many jurisdictions, incentives represent substantial public expenditures, whether these occur in the form of direct loans and grants, foregone tax revenue, or pledges of local government credit. In 2012, the New York Times found that the total value of annual state and local incentives granted exceed $80 billion.[1] The ongoing courtship of Amazon by cities vying to host the company’s second headquarters – with economic incentives cited by Amazon as a key criterion – has again brought such incentives to the forefront of national policy conversations. Given the scale of the investments involved, local policymakers and members of the public are increasingly concerned with ensuring that incentives deliver progress against core economic development objectives and generate the greatest public benefit for the least cost.

 

Aligning Incentives to Advance Public Policy Objectives

 

In most cases, cities’ incentives toolkits are legacy policies that were developed within a different market and policy context, with programs oftentimes rooted in underlying state statutory frameworks. For this reason, the toolkits that exist today may be more reflective of past environments instead of present conditions. In cases where cities have begun to see the fruits of successful efforts to attract investment in their downtowns and core adjacent neighborhoods, many are re-evaluating the need for subsidy in new development projects in strong submarkets. As cities look toward promoting greater inclusivity, local administrations are also looking to how their incentive programs can best support equitable investment across a wider range of neighborhoods.

 

Cities must periodically reassess their toolkits to ensure that the structure and deployment of their incentives advance policy objectives and address current-day market challenges. In assessing their incentive toolkits, city leaders must ask themselves a fundamental question:

 

How effective are our incentive policies in advancing progress against the critical economic and community development challenges we confront as cities today?

 

Agreeing on economic and community development policy goals is an important starting point. In some cases, doing so requires cities to find ways to reconcile potentially conflicting goals. For example, cities may need to consider how best to balance a desire for the greatest aggregate job growth with an interest in supporting quality jobs that offer living wages and viable career ladders.

 

Answering this question also requires accurate measurement of the costs and benefits of incentive deals, including the opportunity cost of foregone tax revenue and an understanding of the public benefits delivered. In many cases, this requires careful efforts to collect and verify data on incentivized projects, a clear methodology to measure program outcomes, and a willingness to revisit approaches to project evaluation metrics and tracking processes.

 

Finally, a constant concern in managing incentive programs is ascertaining that the level of incentive provided is commensurate with the need – “but for” the provision of the incentive, a given project would not have happened. Asymmetrical information issues can frustrate public sector efforts to ensure the efficiency of their programs, as businesses and developers seeking incentives have better knowledge of their capital and operating costs and the corresponding need for public subsidy to fill any financial gaps. In some cases, cities will rigorously “gap test” projects to assess the level of subsidy required. In other cases, economic development departments can periodically evaluate the relative need for incentive support citywide, studying different types of development projects within a range of submarket conditions. Cities can then vary the level of subsidy to better reflect market realities and encourage delivery of public policy objectives. In some cases, cities have leveraged this knowledge to directly address matters of equity; one example is a “recapture” of excess tax increment for incentive deals within strong submarkets, to be reallocated for investment in historically underserved neighborhoods.

 

Innovative Approaches in Cincinnati, Columbus, and New Orleans

 

With assistance from HR&A, the cities of Cincinnati and Columbus, Ohio, and New Orleans, Louisiana, have all undertaken strategic reviews of their incentives programs within the past two years.

 

Cincinnati sought to assess the relative effectiveness of its incentive programs in achieving its economic development goals, as well as identify how to adapt its incentive regime moving forward, given the city’s growing momentum as a place to live and work. HR&A helped Cincinnati develop a strategic framework defining when and how to deploy specific incentive programs, including creating a standardized set of metrics, based on historical data, to enable deal comparison within and across programs. We also helped create a single database for all incentive programs, building on the data we compiled for our study, as well as user-friendly tools and reports for project evaluation and performance tracking, streamlining project review by staff and City Council and more clearly communicating the public benefits of projects.

 

Columbus sought to understand the need for incentives to catalyze development in different submarkets, as well as the overall competitiveness of its commercial incentives. HR&A helped the City identify opportunities to re-calibrate its current incentives in different market contexts to maximize public benefit. We recommended recapturing a portion of the value offered by incentives in more prosperous submarkets to support investment in distressed areas, strategically leveraging funds and targeting them where they are most needed. In addition, we reviewed the City’s portfolio of commercial incentives, and identified opportunities to use incentives to support the creation of higher-wage jobs and drive place-based investment.

 

For New Orleans, HR&A is currently leading a comprehensive assessment of the City’s incentive portfolio to enhance its alignment with broader economic and community development policy goals. HR&A conducted a deep dive assessment of four priority incentive programs to identify their relative efficiency in achieving desired outcomes for different types of projects. We are providing the City with a strategic framework for deploying its incentive toolkit, consisting of initiatives to streamline oversight of incentive programs, create program-specific mandates that help to maximize delivery of public goods such as affordable housing and workforce development, and expand program access and deepen incentives for underserved communities.

 

 

If you’re interested in how HR&A can help your city maximize the value produced by your incentive policies, please contact Partner Cary Hirschstein.

 

 

[1] Story, Louise, “As Companies Seek Tax Deals, Governments Pay High Price,” New York Times, December 2, 2012.

 

High-Speed Rail Meets High-Speed Growth

December 8, 2016 / Comments Off on High-Speed Rail Meets High-Speed Growth

California’s proposed high-speed rail (HSR) system has the potential to spur dramatic economic growth throughout the state. While public attention is largely focused on the benefits of three-hour commute from Los Angeles to San Francisco, the biggest beneficiaries of HSR might be California’s smaller towns and cities. At this year’s Rail~Volution Conference, HR&A Principal Judy Taylor examined how stronger connections between California’s major economic hubs and its mid-sized cities will drive economic growth.

 

  1. Access will attract new residents, but mid-sized cities must revitalize their downtowns to remain competitive. Palmdale and Bakersfield are mid-sized cities within a two-hour drive of Los Angeles that will benefit from high-speed rail. These cities will automatically attract new residents by offering shorter commutes and more affordable housing options than the suburbs of Los Angeles. However, each city can drive additional growth by reorienting commercial and residential development around new rail stations to draw regional economic growth from the periphery to the city center.

 

  1. Targeted development strategies and public improvements around station areas will go a long way. Many smaller cities face physical barriers to growth due to decentralized economic activity; these challenges are often compounded by years of under investment in their downtowns. Through targeted investments around station areas, and land-use policy prioritizing density and infill development, these cities can create competitive urban environments that offer desirable housing, jobs, and connectivity.

 

  1. The creation of a new type of central coordinating body would help drive additional growth. With the termination of California redevelopment agencies and their broad range of redevelopment powers, there is a need to establish a new type of independent entity, likely a public-private partnership, with the ability to coordinate investments. In addition to managing current growth, such a body could also help to advocate for future investment and provide a precedent for future high-speed rail stations to serve as economic anchors for these cities.

 

HR&A is advancing station area planning high-speed rail in both Bakersfield and Palmdale, California. Currently, we’re identifying market opportunities to develop competitive, transit-supportive amenities with the goal of transforming station areas into attractive downtown destinations with new residents, businesses, and visitors from around the region. Learn more about HR&A’s approaches to transit-oriented development across the nation.

Great River Passage Parks Master Plan Approved

June 27, 2012 / Comments Off on Great River Passage Parks Master Plan Approved

 

The St. Paul Parks and Recreation Commission unanimously passed the Great River Passage master plan on June 28, 2012. HR&A prepared the management, funding, and implementation strategy portion of the plan, which was developed by Wenk Associates. The central recommendation of the plan is to unify 17 miles of parkland along the Mississippi Riverfront (an area totaling 3,500 acres) to create a more connected, more natural, and more urban park. The plan also suggests creating an “urban promenade” along portions of the downtown riverfront, offering additional tourism and river-oriented recreation opportunities.

 

When implemented, Great River Passage will remake the Mississippi Riverfront as a world class amenity for St. Paul’s residents, workers, and visitors, and will transform the city as a whole by sparking economic development in downtown and in surrounding residential neighborhoods. It will be managed by a new division of the Parks Department, implementing one of the key outcomes of HR&A’s work on the project.

 

The City and County will review the master plan in the next stages of the approval process, expected to conclude in December 2012. The full master plan is available here.