Tactical Economy?

I have written a few blog entries and posted a few videos at the Local Economy Revolution book web site this week about an event that I participated in last weekend in Middlesboro, Kentucky.  This small town on the edge of the Cumberland Gap held an event called Better Block Boro, and I was one of three national figures who were invited to come, participate and share our expertise.  The other two, Mike Lydon of The Street Plans Collaborative and Matt Tomasulo of Walk Your City, helped the participants implement some tactical urbanism strategies to demonstrate the impact that some relatively simple improvements could make in terms of the downtown area’s quality of life.

I, on the other hand, spent most of the day in “pop-up” conversations with Mike, Tom, Isaac (the downtown program manager) and many others about how low-cost, low-risk improvements like these impact local economies.  With everything that was going on, we had a lot of food for thought.

You can review some of the photos and videos from that event at localeconomyrevolutionbook.com.

Tactical urbanism at work.  Guerilla historic markers.  Makes you realize the potential right in front of you, See more examples at http://wp.me/p3SamA-1m
Tactical urbanism at work. Guerilla historic markers. Makes you realize the potential right in front of you, See more examples at http://wp.me/p3SamA-1m

As I was driving away from Middlesboro that afternoon, I started thinking more directly about how the principles behind tactical urbanism might be applied to revitalizing local economies as well.  There’s several spoken and, sometimes, unspoken assumptions behind tactical urbanism that drive this strategy’s relevance and increasing importance for communities these days.  Without cribbing from any of the standard sources, here’s my interpretation of why Better Block/tactical urbanism efforts have become such a powerful part of the urban planning landscape:

  • They focus on improvements that are achievable in the short term.  Rather than waiting to pull together the funding, the plans, the approvals needed to do a Big Project, they emphasize doing what they can do with what’s available.  Pallets get turned into chairs and bike racks and tables and hanging planters (how many uses can you think of for a wooden delivery pallet?  A whole lot more than I had come up with, apparently).  Vacant lots get turned into outdoor dining spaces and music stages, and extra parking spaces turn into community gathering spots.
  • They place emphasis on the community education that comes from the improvements as much or more so than the actual thing they build themselves.  The goal of a pallet street chair isn’t just to give people someplace to sit.  It’s to give them a real-world lesson in the impact of making public spaces comfortable for people to hang out in.  The implicit realization: many places have had such paltry human-scale public space investment over the last couple of generations that building support for meaningful investments means physically demonstrating what we can do and how it can impact the community.
  • They know that iterative is OK.  A Better Block event is by its nature a little messy.  You have volunteers working on a dozen little projects, things being built out of castoffs, “scavengers” hunting for more wood or tarps or whatever, and a constant stream of “Where can I find an extension cord?” “Do you know where the staple gun is?”  “What do you need me to do?”  The goal isn’t to do everything.  It’s to do enough, this time, with what we’ve got, to move things forward, to spark some understanding and some energy, to get farther down the road to something better than we are today.

One thing Mike Lydon told me is that when his firm proposes to design conventional streetscapes or park improvements or the like anymore, they add a tactical urbanism piece to their proposal — they want to build something physical, something temporary, to maintain the community’s desire to implement the full plan during the long period between finishing the pretty pictures and getting the funding and approvals together to build the permanent project.  They’ve come to understand that people need to see forward momentum, that simply designing something to plop into a space often doesn’t empower the change in minds and hearts necessary to make real community change happen.  After decades of working with urban planners and designers across the spectrum, I felt like a veil had been lifted.

 

The broad conditions that I think have led to the growth of tactical urbanism pull from the same zeitgeist that is impacting how we do a lot of the work that we find ourselves needing to do with our community’s economy.  That includes:

  • Not enough money to do the big projects that we relied on in years past
  • Increasing awareness of the complexity and interrelated impacts that those big projects can generate
  • Increasing levels of peoples’ ability to access and spread their own information (or misinformation) about your Big Project’s feared impacts
  • Increasing distrust that the Big Project will have all the benefits that its supporters promise.

For physical planners, those Big Projects might have been multi-million dollar streetscapes or parks.  For people in economic development and revitalization, that might be big commercial building projects, things that require big financial incentives, big business recruitment.  Just like the streetscapes and the parks, those kinds of economic projects still happen in many places, but the broad trend seems to be that they are getting harder to do, demand more and more money and staff time and community energy, and too often fail to live up to their promised impacts.

So, this is the germ of an idea, and I’m putting it out to you for your ideas, thoughts, brick-throwing exercise, whatever.

I think that we need to start developing a Tactical Economy toolkit.  When people want to do Better Block stuff, a quick Google search can give them all sorts of ideas for projects to try and stuff to build.  Part of what people find when they do that search is simply ideas that they might not have come up with otherwise (how often do you think of putting up guerilla historic signs?), while the other part is specific plans and step-by-step instructions, such as to build a chair.  Not exactly something you want to just take a flyer at and then leave out for people to sit on.

We need both of these in  Tactical Economy toolkit.  Some of the tools might be pretty straightforward to implement – the challenge may be simply helping people think of them.  Others might require some how-to instructions.

What do you think?

 

 

Economic Impact Studies: The Number is not your friend

I’m excited today to introduce a new guest blogger, Peter Mallow.  Pete’s a one of a kind.

Really?  Really.

How many people do you know who have developed subdivisions, fought with small town planning commissions, run a civil engineering firm and completed a Ph.D. dissertation on the use of statistical regional analysis and modelling methods to link  health services to health outcomes within a geographic region?

I didn’t think so.

One thing that always strikes me about Pete is that he has developed this amazing ability to understand and work with data that is way over my head, but connect that back to immediate real-world planning and economic development issues in a way that shines new light on the whole scene.  Sometimes it’s like having a guide to the underworld of how we think… or don’t think… about the data behind our development assumptions.  And he isn’t afraid to call it as he sees it, or to tread in where others might fear to go.

Pete and I have done a very well-received presentation a few times called Don’t get Fooled Again: Understanding and Interpreting Economic Development Projections.    You can see an annotated version of that presentation here and listen to a podcast of that presentation here.  Now that Pete is an official Ph.D. as of a couple of weeks ago, he has kindly agreed to write here on a somewhat regular basis to help us think through the assumptions and mistakes that we make when dealing with economic impact studies… and how even us non-math types can handle them better.

So….I am delighted to introduce you to the esteemed Dr. Peter Mallow!

____

An article published in the Journal of the American Planning Association in 2002 by Brent Flyvbjerg suggested that economic evaluations for large projects – typically the kinds of evaluations done when public dollars are sought to support a project – are intentionally underestimated.  Flyvbjerg followed up this claim with a recent article in the journal Cities, in which he accused planners of deliberately lying about the projected economic impact of projects as shown in those evaluations and attempting to cover up these lies through its professional organization, the American Planning Association.

I think Flyvberg has identified a crucial problem regarding the economic evaluations used to support large projects.  But I think he focused on the wrong piece of the equation.  There will always be an occasional “bad apple” who has intentionally mislead, or a major miscommunication that leaves one side of a disagreement feeling cheated.  As I read these articles, I am reminded of a far more common problem that I see when it comes to understanding and using economic evaluations:

Ignorance.

With all the demands on a planner’s or economic developer’s time, some ignorance is to be expected.  Almost by definition, these professionals have to be generalists first and specialists last.  Because of that, communities typically feel that they need an expert to tell them what economic impact the new project will generate, or how the cost and benefits will stack up, or how many TIF dollars will be generated.  In some cases, planners and economic developers simply rely on the project applicant’s own economic evaluations because the community doesn’t have the resources to hire their own number-generating consultant or buy the software package that promises to spit out that number for you.  In other cases, they get their own consultant or software, but the fundamental problem remains the same.

It’s easy, very easy, to rely on an expert or software package that promised to give you a “certain” answer.  That certain answer? It’s The Number, the one specific number that everyone clings to promote the project.

You have most likely encountered The Number. The Number tells you how many new jobs, how much investment, how much tax revenue, etc. is going to come as a result of the public investment.

People love The Number.  Decision makers love having a clear answer to point to, and the media loves having a number it can easily report.  The Number becomes its own living creature, and the project skeptics and detractors can only wait for the inevitable.

The inevitable?

The inevitable, unexplained, and unexplored uncertainty that is buried in the assumptions and methods behind The Number.  At some point in the future, a seemingly innocuous assumption will change and the actual impact of the project will change dramatically.  When that happens, the project skeptics and detractors will pounce.

And guess who gets caught in the crossfire.

So what do we do?  Too often, planners and economic developers think that their only choice is to run with The Number and deal with the inevitable down the road.  After all, they will argue, life is not certain, and time doesn’t allow us to pick apart the assumptions, methods, and the results embedded in The Number.

And many of you would probably add: Mallow, the money won’t allow it, either.

That’s all true.  But, let me propose an alternative.

If somebody, anybody, tries to sell you on The Number, the only thing you can be certain of is that The Number will be wrong.  Think about a stock investment for a minute.  You have no idea what the value will be in five years…or one year.  You hope it will be higher than today, but would a trustworthy financial advisor assure you that the $10,000 you invest in a stock today will be worth $15,552.35 in one year, or $32,535.97 in five years?

Of course not.  They will give you a range of the most likely future values under different growth or loss scenarios.

Instead of accepting The Number, demand to know the plausible range of jobs, tax dollars, economic impact, etc., given what we know.  Or ask for a range of scenarios — what happens to The Number if the building doesn’t fill up as fast as they project, or the average payroll turns out to be less, or the cost of steel spikes in the middle of construction.  What then?

You can do that.  And you and your community will be better off for it.  After all, you’re not evil.  And you’re not even really ignorant.  You just need to know what to demand, and demand it.

 

The impossible got done: restoring the Fort Piqua Hotel

When you work in community revitalization, you find yourself telling  a few stories over and over again, because they so beatifully sum up the possibilities that struggling communities can’t always see in front of them.  This podcast tells one of the stories that I have been using for years: the revitalization of the Fort Piqua Hotel in Piqua, Ohio.

It’s hard to demonstrate in pictures the outsized impact that this building has on the city of Piqua — both during its decades of vacancy, and in its restored state today.  For a smallish rural city, this sucker is massive — four stories of Richardsoniam Romanesque stone massiveness covering most of a city block.  Drive into town, and you see this thing miles before anything else downtown comes into view.  It literally dominates the landscape.  Imagine how it must have dominated the community’s self-perception during the years upon years that it sat vacant.

Dewberry.com

Since this building is so ostentatiously out of scale with not just the physical, but the economic landscape of a small city, finding a feasible mix of uses for it presented almost as stiff a challenge as finding the money in a small town to pay for it.  As the Fort Piqua story demonstrates so well, mixing uses (and funding streams) results in a more sustainable development, but it also requires a very steady hand in terms of managing all those moving parts.  As you will hear, working multiple funding streams also means working multiple funders — funders whose rules, expectations and plain old bureaucracy can undermine all but the most tenacious, persistent and savvy communities.

fortpiquaplaza.com

There’s a lot of awesome elements to this story — from the often-overlooked and potentially lucrative demand for banquet hall space in small communities (amazing how often that’s a niche that old buildings can fill profitably)  to the years-long determination of those who fought to make this happen, often in the face of people pointing to the long string of attempts that had failed before.  For me, perhaps the most amazing part of the story — and the part I didn’t know before this conversation — was the way that the community stepped up at the moment of need to fill the final gap and make this revitalization happen.  Piqua is a sort of mini-Rust Belt town — not a place where people or businesses have a lot of cash to spare.  But dozens of people put their own money into making this revitalization happen — not because it was some kind of venture capital bet, but because their community needed it.  And because they believed.

dewberry.com

The great part of community revitalization consulting is when you get to touch the hem of communities like this — when you have the awesome priviledge of witnessing the power of people to make great things happen.  Sometimes it makes the rest of the trudge worthwhile.

Thanks to my friend Bill Lutz for sharing this story, and thanks to Piqua for giving us all a new reason to believe that revitalization is possible.  Enjoy!

https://soundcloud.com/wiseeconomy/bill-lutz-ft-piqua-hotel

Registration open: Creative Financing (sponsored by OCMA), February 28

 I’m delighted to invite you to my third training session with Mark Barbash and Jim Kinnett: Creative Financing to Help Create Economic Development.  We hope you will join us for an in-depth, case study-based analysis of both private and public strategies available to finance projects in Ohio communities. We will look at case studies of creative financing projects, including the role that banks will play, local, state and federal financing programs, and the latest on JobsOhio /Development Services Agency programs.
In a departure from previous sessions, this seminar will be held at the Crowne Plaza Hotel, 33 E. Nationwide Drive, Columbus.  It will be held on Thursday, February 28, from 2 to 5 PM.  The change in location and time is for the purpose of making attendance more convenient for persons attending the OCMA Winter Conference.  You do not need to attend the Winter Conference to attend this training session.  Please also note that registration for this session is not included in the Winter Conference registration fee. Separate registration through this link is required.  
 
In keeping with past sessions, the registration fee for this seminar is $125.00 and includes activity materials and a workbook.
To register, please go to http://wiseeconomy.com/speaking-and-training/register-ocma/ . Please send me a note at della.rucker@wiseeconomy.com if we can answer any questions.  Thanks again, and we look forward to seeing you in Columbus!

Also, if you’re interested in this training or others in the series for your organization, but Columbus isn’t nearby… Mark and Jim and I know how to drive cars and get on airplanes.  And we’re nice.  Give us a call.

Here’s a quite well done review of a neighborhood in Chicago and how a magic bullet called Tax Increment Financing (TIF) didn’t create the revitalization funding that was projected. Two lessons here: 1) Not surprisingly, TIFs are not the sure-fire solution that they have been sometimes touted as. If the TIF district does not generate property tax increases naturally, it ain’t gonna work. 2) If a consultant generates a one-point, single-number projection of the future economic impact of any project, don’t accept it. Demand a range of potential outcomes that cover a range of possibilities – what happens if there is less development that full buildout? What if there’s a lot less? What changes to which factors in the assumptions will have the biggest impact on the outcomes – for example, if the land use mix changes from the initial game plan, how will different possible mixes affect the projected outcome? At this moment in history, we should be acutely aware of the fact that simple linear projections of the future aren’t worth the paper they’re printed on. If we settle for that kind of intellectual laziness, from either consultants or ourselves, we cannot pretend to be surprised when the results don’t turn out as we hoped. We must be more practical and more aware of the full range of possibilities if we are going to create wise – or just reasonably functional- communities. Hat tip to Storm Cunningham of www.revitaliz.com for this link.

RT @restorm Chicago discovers TIF can’t revitalize all by itself in poorest neighborhoods. http://t.co/bBCBUjJU

Funding improvements – another reason to look under every rock.

From the Downtown Idea Reporter — sorry,  I don’t have the full story, but the following bit  is intriguing.  Who knew that the USDA would help fund a downtown parking lot?  Of course there are a lot of conditions, depending on which USDA grant they used.  But a sign again that there are often more options that we might think at first.   

BID spearheads parking lot improvement project, cuts
Borough’s costs by almost 50 percent
============================================
The Washington Business Improvement District (WBID) in
Washington, NJ, shows a downtown group repositioning itself
for future growth by taking on new financial activities.

The WBID received approval for a USDA-backed loan that
will allow it to begin much-needed improvements to a
municipal parking lot.

What’s especially remarkable is how much money the
WBIDs taking the lead on the project will save taxpayers –
almost 50 percent of the borough’s original $1.2 million
estimate.