7 Billion for a Transportation Revolution

That’s the election news from Austin, Texas. A pretty hefty purchase for a metro of 2.2 million people. More on the deets from the local Patch:

The project came in two separate parts for voters, Proposition A and Proposition B — both of which gained support from the majority of registered voters. The former, which passed with 59 percent of the vote, calls for an 8.75-cent increase per $100 valuation to the city’s property tax rate, resulting in around a 4 percent increase to the total bill, toward a high-capacity transit system known as Project Connect. Prop B, which passed with 68 percent of the vote, provides for $460 million in debt issuance toward transportation improvements —sidewalks, bikeways, urban trails, safety projects and the like.

This wasn’t the first run at a rail transportation package in the capital of Texas. It wasn’t for lack of need. The urban’s center’s population growth for the decade ending in 2018 was 37%. Yet two prior funding attempts had failed. This time things were different.

“There were three main arguments that were made,” says Austin mayor Steve Adler. “One was congestion. One was climate change. One was mobility equity in our city.”

This time the city was all in. The focus was not only on light rail to improve commute times and to connect various parts of the city, goals which appeal to those who could better use the hour from a daily commute, and to those who prioritize emission reduction. But the plan also provides for “transportation infrastructure including sidewalks, transportation-related bikeways, urban trails, transportation safety projects (Vision Zero), safe routes to school and substandard streets.”

Let’s count the public objectives: transit, health, environment, access to jobs, recreation, safety. And lest you think they forgot about housing:

The plan, funded by an increase in property taxes, also includes $300 million to help make sure that as transportation improves in some neighborhoods and housing values rise, residents aren’t displaced from their homes due to gentrification. They’ll do this by offering rent subsidies, building more affordable housing, and giving financial assistance to home buyers. 

Austin’s business success and hence population boom has put it in the enviable position of having a need for all these public projects as well as the financial ability to fund them, which they have tied directly to the assessed values of real estate.

But what about cities that just need one of those amenities, or even just a leg of light rail, or upgrades to a suite of bridges, or replacement of a water treatment facility? What are the standard pricing mechanisms and what are they tied back to in such a way that is financially acceptable to all those who support the improvement? What are the combinations that upsell a project and close the deal, such as this one in Austin?

Minnesota passed a 1.87 billion bonding at the fifth special session held in 2020. Two years of touring and evaluating worthy projects, and still the delays and posturing and addon’s. The beauty of a standardized pricing mechanism is that the crazy haggling is reduced to more amenable swings. And more importantly people don’t feel the hazy disbelief that I did when I walked away from a souk off the central square in Marrakesh after paying $20 for two sad sticks of incense.

Remote real estate

Saint Helena hangs in the Atlantic between the eastern reaches of South America and the west shores of Africa.

It is one of the most isolated islands in the world and was uninhabited when discovered by the Portuguese in 1502. It was an important stopover for ships sailing to Europe from Asia and Southern Africa for centuries.

A five day ferry ride from Cape Town takes Napoleon buffs to his final resting place on the island. See more great photos from The Atlantic.

Put me in title

In the is-it-private-or-is-it-public game, I agree that a home is a private good. The event which makes you a home owner is a closing, which in Minnesota, is usually held at a title company. On the chosen day the buyers and sellers sit down (pre-Covid) and the buyers sign up for a mortgage to finance the purchase while the sellers sign over a warranty deed. Done deal. No take-backs. The fees include a little state tax and filing fees so the documents are filed publically in the county recorders office.

The process almost seems trivial but it so powerful. This singing over of a title and its public recording in a government office is the most significant feature of private wealth in the US system.

Interestingly, there are a whole assortment of local norms and customs revolving around closings across the United States. Most states either close at the table or over an escrow period. In Wyoming, however, real estate agents conduct the closings. Also specified and unique to almost every state is a foreclosure process. Most weigh heavily on consumer protection. And here is an interesting table breaking down all the nit picky processes and fees.

Owning a home is a staple of the American dream. Owning a home ties you to a community where you participate in measure of all public venues: public safety, pubic schools, public transportation, parks trails and the environment, governance and civic pride.

The History of Hennepin Ave Bridge

When trying to understand why some goods and services are provided in the private sphere versus the public sphere, let’s consider the history of the Hennepin Ave Bridge. Back when Minnesota was just a territory, full of trappers and prospectors and a military force down the river at Fort Snelling, two entrepreneurs took it upon themselves to get folks across the mighty Mississippi. From MNopedia:

In 1847 businessman Franklin Steele and his friend John Stevens established a rope ferry from Nicollet Island to the western side of the river to help travelers cross.

While the ferry helped initially, an increase in traffic necessitated new construction. In 1851 a bridge was built from St. Anthony to Nicollet Island to make the trek to the island easier for travelers. A short time later Steele and local business leaders took steps to build a bridge that would reach both sides of the river.

On March 4, 1852, Steele and his associates were granted a charter by the Territorial Legislature to build a bridge. The group formed the Mississippi Bridge Company and soon after began planning for a new bridge along the same path as the rope ferry. 

The bridge opened to the public in January of 1855. The business partnership of Steele and Stevens charged a toll of 3 cents to the 1450 residents on both sides of the banks to alleviate their $36,000 investment. But there were problems.

The bridge was almost immediately plagued with safety issues. On March 25, 1855, a tornado tore through the area, nearly destroying the bridge. Although it was rebuilt and reopened on July 4, safety and capacity concerns persisted throughout its lifetime that eventually led to its being replaced.

After 14 years, the bridge changed ownership from private to public ownership.

In 1869 the charter the Mississippi Bridge Company held on the bridge expired and Hennepin County paid the company $37,500 to assume ownership. The toll requirement continued until the bonds sold to buy the bridge were paid off in 1872.

This bridge, as well as all other highways and bridges in the state, continue to operate as part of a public transportation infrastructure system. Why some products are deemed private and some are public is a topic this blog will continue to explore. Products and services that meet the demands of numerous groups, whether business groups, family groups, associational groups and so on, in conjunction with a need for some measure of public safety seem better suited to the public sphere.

Meet the Met

The Metropolitan Council was conceived a little over fifty years ago with the foresight that the Twin City Metropolitan Area of Minneapolis and St. Paul would benefit from a multi-county planning entity. Large infrastructure projects like transit and water/sewer in particular would be best coordinated regionally in lieu of by an aggregation of cities. The 17 member council serves at the pleasure of the sitting governor. Here is a nice fact sheet providing an overview of the council’s latest accomplishments.

The council wields a tremendous amount of power for an unelected body. Over the years objections to this structure have been voiced by champions of both the left and the right. But for the time being, it is a structure which continues to influence the growth of residential settlement through patterns of transportation provided by bus and light rail, and through the provision of city and water.

In a presentation last week, Charlie Zelle, the chair of the council stressed that his agency is responsible for planning. In light of this spirit, I would like to propose a new way to frame up some of the research.

There are two new infrastructure projects which will offer circulation options for residents. First off, a new interchange off interstate I94 will provide direct access to the city of Dayton, a third tier suburb. Dayton, with a population of 6,302, was bypassed for development and become donut hole to suburban expansion while the populations of neighboring communities grew: Maple Grove to 71k, Champlin to 25k and Rogers to the NW to 13K. The mayor of Dayton touts the economic potential that will be unlocked by the anticipated increase in vehicle traffic from the off ramp.

The second infrastructure project is the Southwest Light Rail which recently received its Full Funding Grant Agreement from the Federal Transit Administration. This transit option links the four SW suburbs of St. Louis Park, Hopkins, Minnetonka, and Eden Prairie to the City of Minneapolis.

Excitement around Southwest LRT in not just confined to transportation advocates, already the alignment has seen hundreds of millions of dollars of private investments along the line. From affordable housing to commercial centers, Southwest LRT is making an impact on the state’s economy a trend which will continue far into the future.

Both of these projects will allow a new pattern of circulation for residents. One will experience growth and transformation from rural low density to suburban. The other will allow a built community to circulate more readily to and from the downtown core.

Whereas commuters and businesses are often the focus of the benefits to transit, I would be interested in seeing how all pubic goods in these communities fare following the completion of these two projects. Are there effects to public safety? Are the public schools over-loaded or better-funded? Are people healthier due to better access to medical care?

Maybe part of the concern regarding representation within the Metropolitan Council is for this reason; for the need to voice both the positive and negative impacts of transit and water/sewer infrastructure (restrictions) on the suite of public goods underwritten by a city. Elected officials, especially mayors, manage a boutique of goods for their residents, and they are not seeing the Council take all of them into consideration