Houston Strategies

Five steps to save the Obama presidency

2009-11-19T21:47:00.001-06:00

I usually try to avoid politics on this blog, but this Forbes op-ed from Joel Kotkin on saving the Obama presidency not only resonated with me, but also touches on some of the subjects I cover
here. Describing the administration as "Moveon.org run by the Chicago machine" is painfully to the point. He notes:

I suggest these things because, for all his missteps over the past year, Barack Obama is my president and I want him to succeed. But to do so, first he needs to hit his own reset button -- and the sooner the better.

His five recommendations are:

Forget the "Chicago way"
Focus on real jobs, not favored constituencies
Step on the (natural) gas (clean energy independence that would be a big boost for Houston)
Rediscover America
Chuck the Nobel; Embrace Exceptionalism

#4 is directly relevant to common topics on this blog:

Obama's people need to understand that 80% of America live in suburbs or small towns. They do not want to live in dense cities or realize a move there would mean living in less than idyllic conditions. If Obama wants to shape a green America, he must find ways that work with the majority's preferences.

But so far the president's housing, transport and planning advisers seem to be pushing the death of suburbia and promoting ever more densification. It's hardly surprising, then, that suburbs and small towns feel left out. After finally starting to inch toward the Democrats, they are now turning again to the right. If Democrats want to retain their majority, they need the strong support of these constituencies -- without it the Congressional majority will be gone by the end of the second term, if not the first.

I think it's a problem all presidents face: no matter how centrist they aspire to be, they have to deal with extreme left or right Congressional leadership (since the most lopsided districts tend to have the most stability and therefore seniority) - and the farther down administration appointees get from the President, the more extreme left or right they tend to be - because that's the supporter base they draw from. These extremists undermine centrist Presidents in the million little actions that happen every day in DC. It's an inherent flaw in the system, and the system needs to be fixed.

Houston=Brooklyn? plus rankings, not-so-smart growth, anti-poverty incentives, mixed-use difficulties

2009-11-16T21:44:00.001-06:00

Clearing out some smaller items:

In case you missed it, Randal O'Toole had a must-read Sunday Chronicle op-ed on how smart growth would not save Houston from future Ashby high-rises, and in fact would create more.
New Geography: Smart Growth loses Houston mayor's race. Hat tip to Josh.
Has anybody seen a chart similar this one for Texas or other states? Note to politicians: incentives to stay in poverty are not good.
An older Dallas Morning News article I recently came across on the difficulty of filling the ground-level retail space in mixed-use projects, which seem to be more popular with planners than with retailers, usually because of the difficulties of access/parking. The upper-floor residential is not enough to support the shops or restaurants. This may become more of a problem in Houston as development happens under the Urban Corridors ordinance near the LRT stations. Hat tip to Neal.
From the national DMIBlog: Is Houston becoming the new Brooklyn? Not much news here, but might be of interest if you want to see an outsider's perspective. Hat tip to Jessie.
The Milken Institute has released its 2009 Best Performing Cities list. Houston scores very well at #5, up from #16 last year and by far the largest metro in the top 10. Austin is #1, and Texas has 9 of the top 25. Hat tip to Neal.
Continuing the rankings theme, a few cultural ones from Travel and Leisure magazine (out of 30 cities):

Theater: Houston #5, Austin 23, San Antonio 24, Dallas 27.
Museums: Houston #8, Dallas 24.
Classical Music: Houston #5, Dallas 22.

A nice sweep of our in-state rivals, and not a very close one at that. Hat tip to Brian.

The essence and future of TX vs. CA

2009-11-12T18:08:00.003-06:00

I know there have been a lot of articles and references to Texas vs. California recently in this blog, but, well, there's a new one with some genuinely new contributions to the argument ("America's Future: California vs. Texas", Trends magazine, hat tip to Jeff). And it says some nice things about Houston too, so how can I pass on it? The beginning of the article is here - including an overview of both states' situations - but here are some key additional excerpts:

...Both the Brookings Institution and Forbes Magazine studied America’s cities and rated them for how well they create new jobs. All of America’s top five job-creating cities were in Texas. It's more than purely economics and regulation can explain, though. Texas – and Houston in particular – has a broad mix of Hispanics, whites, Asians, and blacks with virtually no racial problems. Texas welcomes new people and exemplifies genuine tolerance. When Hurricane Katrina hit, Houston took in 100,000 people. Not surprisingly, Houston has more foreign consulates than any American city other than New York and Los Angeles.
...
But, how did this happen? What’s wrong with California, and what’s right with Texas? It really comes down to four fundamental differences in the value systems embodied in these states:

First, Texans on average believe in laissez-faire markets with an emphasis on individual responsibility. Since the '80s, California’s policy-makers have favored central planning solutions and a reliance on a government social safety net. This unrelenting commitment to big government has led to a huge tax burden and triggered a mass exodus of jobs. The Trends Editors examined the resulting migration in “Voting with Our Feet,” in the April 2008 issue of Trends.

Second, Californians have largely treated environmentalism as a “religious sacrament” rather than as one component among many in maximizing people's quality of life. As we explained in “The Road Ahead for Housing,” in the June 2009 issue of Trends, environmentally-based land-use restriction centered in California played a huge role in inflating the recent housing bubble. Similarly, an unwillingness to manage ecology proactively for man’s benefit has been behind the recent epidemic of wildfires.

Third, California has placed “ethnic diversity” above “assimilation,” while Texas has done the opposite. “Identity politics” has created psychological ghettos that have prevented many of California’s diverse ethnic groups and subcultures from integrating fully into the mainstream. Texas, on the other hand, has proactively encouraged all the state’s residents to join the mainstream.

Fourth, beyond taxes, diversity, and the environment, Texas has focused on streamlining the regulatory and litigation burden on its residents. Meanwhile, California’s government has attempted to use regulation and litigation to transfer wealth from its creators to various special-interest constituencies.

They go on to make six forecasts:

...expect to see California’s loss of jobs to Nevada accelerate...
...expect to see a backlash in California and across the country against regulations, especially green initiatives that can’t clearly demonstrate a positive ROI...
Watch for the smart money, including venture capital, to begin migrating to Texas for start-ups in many areas, including energy, info-tech, manufacturing, and biotech. Just as Delaware’s tax laws once encouraged numerous businesses to incorporate there, even when they had no connection to the state, Texas will become a magnet for new businesses by offering cheap land, a favorable regulatory environment, a business-friendly culture, and a large supply of skilled labor. Unless California revamps dramatically, expect to see its economy languish, even as the recovery takes off.
To make its business climate even more business-friendly, Texas will invest heavily in secondary education and work hard to attract the best talent to its research universities (note the recent Tier 1 proposition and funding). Keep an eye especially on the University of Texas, which already has a first-rate campus and faculty. Within 10 years, UT, as the locals call it, may well rival Stanford or Berkeley.
Other states will adopt tort reform measures pioneered in Texas. Unlike California and most other states, Texas has been aggressive in minimizing the enormous burden of frivolous lawsuits...
Look to Texas to become a cutting-edge cultural mecca. Houston has always offered a vibrant cultural scene, ever since the Alley theater company was founded there in 1947 by Nina Eloise Whittington Vance. In the 1950s, John and Dominique de Menil moved to Houston with one of the most significant private collections of art in the world and began donating art and money to the Houston Museum of Fine Arts. Both institutions have grown to world-class status since then. In the coming years, this trend will spread to the major cities of Texas (take that, Dallas!), attracting the best talent and money and shifting the cultural balance of the nation away from New York and San Francisco.

I can personally vouch for #5. I was just visiting my brother out in CA, and a friend of his with a small store was being hit with a large disability discrimination lawsuit for a minor oversight (handicapped parking was marked on the ground and had the requisite walkways and ramps, but lacked a pole sign). Evidently this has become a cottage industry in California, where lawyers guide the disabled through stores looking for very minor violations of a vague law (things like high shelves or tables), then sue (expecting a quick settlement, of course). Under CA law, discrimination guilt is assumed if there's anything in the store the disabled can't do that a normal customer can do, regardless of the availability of employees to provide assistance. His friend was clearly exasperated with the unwinnable situation. Just plain nuts.

As Jim Goode says, "You might give some serious thought to thanking your lucky stars you're in Texas."

Update: a related op-ed. Hat tip to Ginny.
Update 2: Reposted over at New Geography.

Planes vs. high-speed vs. 'higher-speed' rail in Texas

2009-11-09T18:09:00.000-06:00

This story on the Eurostar London-Paris high-speed rail caught my eye yesterday in the Chronicle Travel section. I have ridden it before, and it is a wonderful service. The speed is deceptively quiet until a train going the other direction passes by in the blink of an eye at a 300mph net speed difference. And London and Paris have great local transit connections at each end, of course. It was during my McKinsey management consulting days, and the travel department bought me a first-class ticket on a non-peak train, so I ended up with an entire first-class car, and hostess, to myself. Not bad at all...

But I digress. What jumped out at me from the article was the one-way prices:

First class: $425
Second class (i.e. coach): $300
Advance purchase restricted second-class/coach: $80-$160

Now, since the most touted route for Texas is DFW-Houston, let's look at comparable flight prices:

Continental first-class walk-up fare: $264
Southwest walk-up coach: $136-$151
Southwest advance-purchase restricted coach: $49-$106

So, for a route of roughly the same distance, HSR is roughly twice as expensive as current airplane service, which, by the way, is one of the most frequently serviced routes the country between Southwest, Continental, and American.

So tens of billions are spent to provide service that is twice as expensive as we already have? No wonder everybody wants the Feds to pay for it.

A more cost-effective alternative for Texas may be "higher-speed rail" running around 100mph on existing tracks (the 'higher' is relative to existing trains, not HSR, so we have the confusing situation of higher-speed rail being slower than high-speed rail). More here and here, as well as a Texas track map. This would also be compatible with the plans for 290 and Galveston commuter rail.

I've been collecting some other HSR links for a while now that are worth passing on:

Famous economic blogger Megan McArdle's viewpoint in The Atlantic
The Austin Contrarian on the messed-up map currently proposed (which connects Houston to NOLA instead of the rest of Texas) and the possible negative secondary effects on flight service (not just the flights that compete directly, but flights elsewhere that depend on those flights to feed them passengers).
The HAIF HSR debate (hat tip to Jessie)

Texas schools are better than you think (but still have a long way to go)

2009-11-05T17:33:00.000-06:00

For a while I've been wanting to do a post on this McKinsey report titled "The Economic Impact of the Achievement Gap in America's Schools" (main report, supporting charts).

First, the (very) bad news:

This report examines the dimensions of four distinct gaps in education: (1) between the United States and other nations, (2) between black and Latino students and white students, (3) between students of different income levels, and (4) between similar students schooled in different systems or regions.

The report finds that the underutilization of human potential as reflected in the achievement gap is extremely costly. Existing gaps impose the economic equivalent of a permanent national recession—one substantially larger than the deep recession the country is currently experiencing. For individuals, avoidable shortfalls in academic achievement impose heavy and often tragic consequences via lower earnings, poor health, and higher rates of incarceration.

But within the report is small silver lining for Texas:

...differences in public policies, systemwide strategies, school site leadership, teaching practice, and perhaps other systemic investments can fundamentally influence student achievement. California and Texas, for example, are two large states with similar demographics. Yet as shown in Exhibit 7, Texas students are, on average, one to two years of learning ahead of California students of the same age, even though Texas has less income per capita and spends less per pupil than California. (details on p.58/57 chart here)
...
...the best-performing state for low-income blacks (Texas). (#2 for low-income whites behind MA, based on 4th-grade math)

So much for the argument that more money is the answer to improving public schools.

Some other nuggets from the slide pack of supporting charts:

Houston is near the top of metros for math performance of low-income black fourth-graders, and well above the national average (p.57 of pdf, labeled p.56).
On the downside, HISD is five points behind the Texas state average (p.65/64).
Texas is the #2 state for black graduation rates behind AZ. 68% is still way too low, but it is only 8% behind whites, one of the smallest gaps among states. Surprisingly, some of the largest gaps are found in most progressive/liberal/blue states. (p.66/65)
"California has the most students of any state and has a relatively high income level but low achievement level. Texas is the second most populous state with a medium income level and relatively high achievement levels." (p.114/113)
Schools and districts have a lot to learn from each other, especially from the best ones: "Across Texas districts, test passing can vary by 25 percentage points. Within Texas districts, school achievement levels can vary by 20-30 percentile." (these are adjusted for demographic differences) (p.55/54)

What might account for Texas' advantages? The report doesn't really say, but we can speculate.

Stronger private charter schools providing public school competition? (KIPP, YES)
Weaker teachers' unions make it easier to implement reforms and remove bad teachers?
Texas culture/work ethic?
A weaker welfare/safety net incentivizes student performance and parental support?
Being a right-to-work/weak-union state might also incentivize student performance and parental support: education is the path to a better job rather than dropping out and getting a comfortably-paid blue-collar union job. Unskilled labor does not pay well in Texas, and that's a pretty strong incentive to learn skills.

Your own thoughts/reasons are welcome in the comments.

For more on this, and how far Houston and Texas still have to go, I highly recommend checking out and supporting local Houston nonprofit 'Children at Risk'.

Voting, Houston's greatness, top ranking, and more

2009-11-02T18:03:00.000-06:00

Continuing from last week: originally, my plan was to break up the smaller misc items into two posts of five items each, but then three new items came up over the weekend, so you get eight in this one. The first three are the new ones:

Wondering who to vote for Tuesday? The Chronicle does a pretty good vetting, and their endorsements are here. Print it and take it with you to the booth.
Kevin Kirton, the developer behind the Ashby high-rise, made a good case in Outlook yesterday not only for his development, but also for our (usually) predictable rules of development:

Houston already has a plan for development that works. That plan is to 1) establish a basic set of rules, 2) provide a level playing field, 3) enforce the rules fairly — without regard to political influence, 4) accommodate growth with roadway and utility infrastructure, and then 5) allow the market and consumer demand to determine the best land use.
These simple principles, supported by a fair and mostly uncomplicated set of regulations, have allowed this city to grow at a pace and with a vitality unmatched by any other major city in the nation. For example, our form of planning has given us the largest medical center in the world, as well as Greenway Plaza, a major employment center close to the homes of the people who work there, and the Galleria, one of the most widely imitated retail and commercial districts in the world. Perhaps surprisingly to some, it even gave us Montrose, just named a national Top 10 Neighborhood by the American Planning Association.

The Chronicle has this story on internet wifi being offered on San Antonio express commuter buses to attract riders, which has already been successful in Austin. Why isn't Metro doing this?
The Austin Contrarian on the health benefits of congestion pricing and keeping traffic in free flow.
Marc Nathan over at Startup Houston on what makes Houston great. He also has embedded a Rice event promo video that focuses on Houston starting at the 3:30 min mark. Pretty well done. Bet you didn't know our town was that cool, did ya? He also linked to a CNN photo essay on Houston.
Fortune ranks Houston the 4th-best city in the country to start a small business, and the #1 very large city. Here's their profile of the city. Hat tip to Marc.
A NYT story on our rapidly expanding natural gas reserves due to new drilling technologies, and how that might change the energy future of the country. And now the Chronicle is doing their own article series. That's how innovation works. Everybody thinks they know all the answers, and then something comes out of nowhere and changes the game.
DART is about to run so many light rail trains through downtown Dallas that it may create true traffic gridlock. My understanding is that Houston may face the same risk when the east-west line opens downtown. It will take some amazingly sophisticated train and traffic signal synchronization to keep things running smoothly down there. Same for the Uptown/Galleria line on Post Oak... Hat tip to Barry.

Toll plans, TMC problems, empty nesters, Ashby regs

2009-10-29T17:14:00.004-05:00

Yet again I've let the backlog of smaller items get too large, so I'm going to have to break them up into a couple of posts.

If you missed it, here's my reaction over at my Chronicle Opportunity Urbanism blog to the front page story on the survey desiring more land-use regulation, mainly based on the stream of Ashby high-rise stories over the last two years. Also, Kendall Miller of HRG has an excellent response letter in the Chronicle (4th letter down).
A cold splash of reality from a recent Wall Street Journal article on urban living without a car:

...demographers and economists have predicted that many aging baby boomers would opt for smaller, easier-to-manage dwellings once their children left home. Those predictions helped spur a surge in loft and condominium developments in many U.S. cities, as well as efforts to develop so-called walkable communities.
So far, the bet hasn't paid off. "The developers that anticipated a big increase in condominium living in center cities are sorely disappointed," says Gary Engelhardt, a professor at Syracuse University who's studied the influence of boomers on the housing market. The housing bust has led many people who might have sold their suburban homes to stay put. But even when the market recovers, Mr. Engelhardt says, "I don't foresee a massive movement back in center cities for older individuals."

Why not? From what I've heard, it's what you'd expect: not only do empty-nesters have deep ties to their current suburban community (church, friends, etc.), but they also want a home big enough to welcome their children and grandchildren for frequent visits.

While listening to a pros vs. cons lecture on the potential Rice-Baylor merger, I heard about this recent article in Nature on the financial troubles in the Texas Medical Center.
More on the Med Center: NY Times Sunday in-depth piece on MD Anderson cancer hospital here in Houston.
If you're interested in HCTRA's long-term plans for new toll road projects, they're detailed here, including a nifty map (pdf is best for detail). Hat tip to Triton at HAIF.

UPDATE: Evidently the Fairmont Parkway has been taken off the current version of that map. Details here. It implies they may do it non-tolled. I hope they definitely keep the RoW here for a future freeway at some point. Tolled or not, it will be needed, if only to take some of the load off of overcrowded 45S. And the population out there is exploding. It's a great alternative to the waterfront and one of the Port terminals. Hat tip to Eric for the update.

The rest next week.

Rice's chairman on Houston and its challenges

2009-10-26T18:56:00.000-05:00

Jim Crownover, former McKinsey director and current chairman of the board at Rice University, spoke at event last week and made some interesting comments on Houston. He discussed some of the incredible growth Rice has seen in recent years, and expressed hope for the Baylor merger. The benefits to Houston of the Jones Business School at Rice were also outlined, including:

$1 billion annual contribution to gross area product (that includes salaries of all alums)
$345K impact per alum in Houston
The Rice Alliance for Technology and Entrepreneurship has helped launch over 230 startups by connecting them to $500 million in funding.

But he also listed the four major challenges Houston faces in the next decade:

K-12 education
Energy - will we maintain leadership? He thinks Rice can help here with a balanced approach of policy, economics, and technology.
Health care - will we maintain leadership? Federal health care reform and Baylor's decline from financial problems are key issues here.
Mobility/transportation: congestion growth and energy price increases will continue and our density is unlikely to change in a meaningful way, making mass transit a very difficult problem to address.

He didn't offer solutions - just said these issues need top-to-bottom focus. But he did express optimism about Houston's ability to unify and address these problems, as compared to northern cities with high legacy problems and costs, and west coast cities with "dis-integration" weaknesses (i.e. a lack of unity in solving problems). I tend to agree that our relative unity is a very important strength, and one we should preserve at all costs - even through feisty mayoral elections...

Report from the HRG Smart Growth Conference

2009-10-22T17:50:00.001-05:00

It went quite well. Thanks to those of you who plowed through the rain to attend. If you're interested in some of what was said, the Land Use Prof Blog has a report. I'm also hoping to link to some of the charts and video when it's up. But in the meantime, here are a few of my observations and a portion of my intro speech:

Sam Staley from Reason went in depth on how land use regulation works in other cities vs. Houston. The bottom line difference was staggering: 3-4 months for development approval here vs. 2-4 years elsewhere! And that time difference adds massive uncertainty, risk, and costs.
Commissioner Todd Staples said Texas has the highest productivity per person and GDP per person vs. any nation. While I believe that's in the ballpark, I'm not sure that includes some of the smaller, super-wealthy countries like Norway, Luxembourg, or even Switzerland (not to mention some other states). But impressive nonetheless.
Wendell Cox pointed out that, on a global basis, the most sprawling cities have the shortest average commutes, with access to more jobs and higher productivity. Some of the most dense cities, like Hong Kong, NYC, and Sydney, had the longest average commutes.
Luis Vera of San Antonio LULAC spoke out against the inherent minority discrimination in smart growth policies, including home unaffordability and diverting transit resources from buses to rail.
Mike Inselmann of Metro Studies had data showing Houston is currently the #1 metro in the country for homebuilding, followed by DFW and then dropping off rapidly in other metros.

And here's the main body of my introductory speech:

We’re here today to talk about Smart Growth. Let me read the definition from Wikipedia:

“Smart growth is an urban planning and transportation theory that concentrates growth in the center of a city to avoid urban sprawl; and advocates compact, transit-oriented, walkable, bicycle-friendly land use, including neighborhood schools, complete streets, and mixed-use development with a range of housing choices. Smart growth values long-range, regional considerations of sustainability over a short-term focus. Its goals are to achieve a unique sense of community and place; expand the range of transportation, employment, and housing choices; equitably distribute the costs and benefits of development; preserve and enhance natural and cultural resources; and promote public health.”

Kinda hard to argue with? Doesn’t sound too bad? It’s a siren song that has certainly attracted a large number of communities across the country. But they have not only found that it requires extremely intrusive government control and intervention in markets to get the desired outcomes – something that seems to run against the grain of our American charter based on freedom – but it also has created many unexpected negative side effects, the most painful being the loss of affordability (from housing supply restrictions) and the price bubble that led to the recent crash. The loss of home affordability has been particularly hard on poor and minority communities. Dr. Edward Glaeser at Harvard has built a substantial academic reputation exposing these affordability problems from excessive government regulation, ironically from some of the supposedly most progressive governments. One study from the University of Washington found that regulations added $200,000 to the median price of a home in Seattle.

Additional smart growth ramifications include:

Costly transit investments, particularly light rail, with low ridership that fail most cost-benefit calculations and often financially hobble their transit agencies, forcing painful bus service cutbacks on the most vulnerable transit-dependent populations.
Inadequate road investments leading to rapidly worsening traffic congestion and gridlock, along with increased air pollution.
Increased taxes to afford the needed development subsidies, transit investments, and infrastructure upgrades to accommodate increased densities in areas not designed for it.

Houston has been lucky to avoid most of these fads and problems, and has remained the most affordable major metro in America. Just one data point from Coldwell Banker: the equivalent of a $155K house in Houston would cost $357K in Denver or Portland and $536K in smart-growth paragon Boulder.

Here a few of my own related observations from my blog:

Growth is good. Despite the hidden anti-growth attitude in smart growth, studies of cities show that a doubling of population is accompanied by more than a doubling of creative and economic output. The larger the population of a metro, the greater the innovation and wealth creation per person.
People want space. Sprawl is not evil. Throughout history, even going back to the medieval nobles and their country estates, people have always desired more personal space as they have grown more affluent. Make this space unavailable by forcing density through regulation or inadequate transportation, as in Europe or Japan, and not only does housing become unaffordable, but fertility rates will drop below replacement levels as families shrink. If they can’t increase the size of their home, they will shrink the size of their household, which creates a financially destabilizing demographic implosion.
Density has limited appeal. As young people push marriage later, we have a new twenty-something stage of life where people want to live in a dense, vibrant, urban core. But, inevitably, as they marry and start families, space, cost, and school concerns draw them to the suburbs. Cities should absolutely offer good urban lifestyle options to those who desire it, but it will always be a relatively small part of our population.
People cannot be forced into the dense core or on long commuter transit rides against their will. If people can’t access nice, affordable homes and good schools within a reasonable commute, employers will move out to suburbs, leading people to move even further out, expanding sprawl, and draining the core’s tax base.
Most southern cities, like Houston, have a pedestrian-hostile tropical climate several months of the year. While northern transit-based cities benefit from a personal warming technology – the coat – the only personal cooling technology that exists for southern cities is an air-conditioned vehicle.
Cities that are hostile to the car will stagnate. The car is now a permanent part of our culture. Busy lifestyles require its comfort, speed, and convenience – but the propulsion technology will change to be greener and more energy efficient. This represents the future for the vast majority – not dense, transit-oriented living.
Planned density almost always fails. Planners try to protect low-density areas and designate high-density ones, but, inevitably, NIMBYs protest and shoot down the high-density development if there is a regulatory mechanism for them to do so – like a zoning board they can influence. Recent data shows that Houston’s free market approach builds one-third more density per capita than Portland’s highly prescriptive, planned approach. And a recent ULI advisory panel was emphatic in recommending that Houston not adopt zoning.
Commuter rail rarely works in a post-WW2 car-based city. Old cities in Europe and America were built with dense cores for the primary mobility mode of the time: walking. Rail allowed people to move to the suburbs and still commute to the single dense core of jobs (like Manhattan or downtown Chicago). Newer, mostly post-WW2, car-based, Sunbelt cities like Houston have decentralized jobs spread over many different centers, like downtown, uptown, the medical center, Greenway Plaza, the Energy Corridor, Westchase, Greenspoint, Clear Lake, and more. Less than 7% of our jobs are downtown. Trying to connect commuters to these job centers with rail would not only be astronomically expensive, but would lead to impractically long commute times with multiple transfers and long walks for people to reach their final destination buildings. Instead, there is a better commuter transit solution for these types of cities: frequent nonstop express buses and vanpools in managed lanes that whisk commuters directly to their job center and then circulate to get them right to their building without transfers, waits, or long walks in unpredictable weather.

These speakers today will outline what has worked and what has not with smart growth. I’m hoping this can help us make improvements to define a vision for a “Smart Growth 2.0”. One that, for instance, enables popular new urbanist developments by removing barriers and regulations rather than adding them. With that context, let me move on to our speakers.

Free conference this Wed on the issues of smart growth

2009-10-19T08:33:00.001-05:00

HRG is putting on a free conference this Wednesday afternoon at the GRB downtown: "The Truth About Smart Growth: Setting the Stage for the Housing Collapse - National Conference About What Works & What Hurts." I will be doing some speaking at the event, and look forward to seeing as many of you as possible there. Should be a lively discussion. We're even hoping for some of the mayoral candidates to come by for a briefing. Details and registration are here.

Experts from around the nation and world will be on hand in Houston, October 21st to discuss the advantages and pitfalls of “Smart Growth” approaches to urban development. Of national significance is the role that market distorting policies have had on the housing collapse and, by comparison, alternative growth strategies used by some cities that have avoided such pitfalls. We expect both local and national media attention to this timely topic.

The conference is set for the George R. Brown convention Center from 2 to 5 pm on October 21st and will feature speakers and topics including:

1. Ron Utt, The Heritage Foundation - Price Inflation Through Public Policy” “Housing Bubbles” evidence from UK study indicating price inflation as a direct result of the Town and Country Planning Act.

2. Wendell Cox, Demographia- How Texas’ regulatory environment helped us resist the economic downturn.

3. Sam Staley, The Reason Foundation - How Houston’s free market land use system is superior, the advantages of it, and how it compares to the traditional planning process.

4. Mike Inselmann, Metro Studies - Case study of national housing prices and trends - Which areas were most affected during recent housing bubble crisis and what types of regulations caused the problem.

5. Randal O’Toole, The Cato Institute - Present an alternative vision that achieves same goals. What are mild incentives to encourage market driven growth? The fiscal impacts on local governments.

6. Luis Vera, Pacific Legal Foundation, LULAC – “Protecting land owner/ home owner rights” in courts - will examine what smart growth policies do to affordability and the damaging effects that they have had on the middle and lower class.
7. Special Guest: Todd Staples, PAC! Off: It's My Land - Presentation of a new pro-Proposition 11 coalition comprised of associations and state leaders concerned about abusive takings of private property by government eminent domain.

As you can see, this respected group of scholars will be discussing the myths and the realities of centralized government growth and development controls, significantly, here in the largest American city without zoning—and in the city that has resisted the worst effects of the housing downturn.

Lessons for Houston from the global urban revolution

2009-10-18T17:27:00.000-05:00

Thanks to a generous invitation from the World Affairs Council of Houston, I was able to attend a recent talk by Jeb Brugmann, author of "Welcome to the Urban Revolution: How Cities are Changing the World", on "Cities of the Future: Ideas for Houston from Cities of the World." Most of his talk focused on the benefits and risks of the rapid urbanization of our planet, especially in the developing world (with a focus on India). He articulated four primary benefits that are driving the global rural-to-city migration:

Concentration: making markets with proximity economies of scale. Our own example is the concentration of flower shops along Fannin north of the Medical Center, not to mention various farmers' markets.
Density: the most efficient possible cost structure. His developing world examples were similar to what you'd see in the NYC immigrant tenements 100+ years ago. While I agree that, in a world of walking and transit mobility, maximizing density is important, I don't think it's necessarily the optimal answer when societies become wealthy enough that other mobility technologies start to dominate, like the personal vehicle. It is all about maximizing connections to other people, and that is a combination of density and mobility, or what I refer to as opportunity zones.
Association economies
Extension of urban infrastructure and connections

As for urbanization risks, he mentioned several: crime (inc. organized crime), populism from income disparities, disease spread and mutation, and the financial/housing crisis. I did not know that the Pearl River delta in China, home to hundreds of exotic live animal markets, is a major source of mutating animal diseases that jump to humans (like SARS a few years back).

The most interesting part of his talk was on Curitiba, the Brazilian city famous for its BRT transit system. Some of his points on their system offer good lessons for Houston:

The transit system is profitable, which is unheard of.
100 private bus companies compete
Not master planned (more organic)
Dedicated bus corridors
Different optimally-sized buses by route
Boarding tubes/shelters like the subway, to speed payments and boarding
385 routes
40-second headways (not sure on how many of the routes)
45% of daily trips are profitably served by BRT
They have the most autos per capita of any Brazilian city, but the least gas usage per capita

This amazing high-service, low-cost system could easily be achieved in Houston if we were less obsessed with pouring billions into rail.

He ended abruptly by saying the new urbanist, mixed-use densification of San Jose, CA represented the future, and Houston should emulate it. He said they wanted to move away from the private corporate campus model of the tech companies. I don't buy it. Can you imagine Google or Apple maintaining their security if their buildings were part of a mixed-use campus open to the public? And San Jose's transit system is one of the larger disasters in America. A key excerpt:

...VTA has “the worst operating statistics of any American transit operator.” The reason for this, he says, is that San Jose — being built mostly after World War II — is one of the most spread-out urban areas in the country. Not only are people spread out, but jobs are spread out, with no job concentrations anywhere.
This makes large buses particularly unsuitable for transit because there is no place where large numbers of people want to go. So what was VTA’s solution when its bus numbers were low relative to other transit agencies? Build light rail — in other words, use an expensive technology that requires even more job concentrations.

Now it has one of the, if not the, poorest-patronized light-rail systems in America. So what is its solution? Build heavy rail, a technology that requires even more job concentrations.

The initial analysis for building BART to San Jose, Rubin notes, projected that it would cost more than $100 to get one person out of their car for one trip on BART (!!!). (By comparison, most bus improvements cost $2 to $6 per new ride, while light rail usually costs around $10 to $30 per new ride.) To make the numbers look better, VTA assumed that downtown San Jose would grow to be 80 percent the size of downtown San Francisco, which Rubin considers unlikely in the extreme. Even if it builds this BART line, VTA admits it doesn’t have the money to operate it.

VTA is now so heavily in debt that when the dot-com bust hit Silicon Valley, it was forced to cut transit service by nearly 20 percent. The in turn contributed to a 33 percent loss in transit riders. This makes San Jose’s light rail a true planning disaster and suggests that BART to San Jose, if it ever gets built, will be an even bigger disaster.

The fact that VTA is willing to sacrifice its transit riders in order to persue a dream of ever-more-expensive rail transit leads Rubin to conclude that, while he doesn’t know for sure if VTA is the worst-managed agency, “if there is a worse one out there, I hope I never find it.”

Does any of this sound ominously similar to Houston's direction?

I think there will be many more mixed-use, new urbanist projects, and they will be popular, but they will not be fundamentally transforming either San Jose or Houston. We will change the propulsion technology of cars before we make any mass, fundamental shift to density and transit.

On the other hand, he did make one point that I wholeheartedly agree with: it is extremely important to have a vibrant local developer community to do customized local development for a particular city's situation. Customize the urbanism, transit, and transportation to the city. Curitiba went against convention with BRT over heavy rail like NYC, London, and Tokyo. Houston should do the same.

Summer 3Q09 Highlights

2009-10-07T20:33:00.000-05:00

First, a quick note: I'll be traveling over the next week or so, and probably not blogging.

It's time for the Summer 3Q09 quarterly highlights post. These posts have been chosen with a particular focus on significant ideas I'd like to see kept alive for discussion and action, and they're mainly targeted at new readers who want to get caught up with a quick overview of the Houston Strategies landscape. I also like to track what I think of as "reference posts" that sum up a particular topic or argument.

Don't forget we offer an email option for the roughly twice/week posts - see the Google Groups subscription signup box in the right sidebar. An RSS feed link (Atom) (or RSS 2.0) is also available. As always, thanks for your readership.

September

Why the feds should stay out of high-speed rail (and most transportation)

August

July

And from Spring 2Q09

June

Mitigating some issues from Houston Urbanism (last paragraph)
Securing Houston's economic and world-city future
Ike Dike (affordable hurricane protection for Houston)
Why rail to the airport doesn't make sense

May

And don't forget the highlights from the first four years. For what it's worth, I think the best ideas are found there, often in the first year (I had a lot "stored up" before I started blogging).

Touting Houston's approach to planning

2009-10-07T06:21:00.000-05:00

Just wanted to pass along some of the great excerpts/quotes from this morning's front page Chronicle story on Montrose's award:

Eclectic, walkable and one of top 10
Montrose, the central Houston community known for its diverse lifestyles, vibrant street life and stately historic homes, is being honored by the American Planning Association today as one of the country's 10 great neighborhoods.

Houston's sprawl, absence of zoning and reputation for haphazard development might make its recognition by the national planning establishment something of a surprise. Yet the qualities cited in the award for Montrose — its walkable street grid, carefully preserved historic districts and eclectic mix of homes and businesses — reflect Houston's preference for private rather than government-imposed planning, experts said.

In the early 20th century, long before it became the focus of slum-clearing urban renewal projects or the heart of Houston's gay and lesbian community, Montrose was an elite master-planned suburb, said Stephen Fox, a Rice University architectural historian.

“Its planning has really come from the developers of the individual subdivisions rather than representing any public policy,” Fox said.
...
Robinson, an architect who serves on Houston's City Planning Commission, said the award shows that effective planning need not be imposed through heavy-handed government policy.

“It doesn't have to always be a prescribed method of growth,” Robinson said. “It's organic. The street grid, the sidewalks have meant that without zoning and for the most part without restrictive covenants, the area has been able to grow and adapt.”

The street grid — a web of straight streets with short blocks and none of the cul-de-sacs favored in suburban neighborhoods — has helped keep Montrose walkable since the days when people stepped off streetcars and walked to homes or shops, Robinson said.

David Morley, a research associate at the American Planning Association, said Montrose's pedestrian-friendly nature was an important factor in the award.

“It's one of the few places in Houston where people get out of their cars and walk around,” Morley said.

Marlene Gafrick, Houston's director of planning and development, said the award should help to dispel Houston's undeserved reputation as an unplanned city.

“I believe planning occurs at many levels, and one of the differences between Houston and a lot of cities is that a lot of our planning comes from the ground up rather than the top down,” she said.

Thoughts on recent transportation news

2009-10-05T16:44:00.000-05:00

The Chronicle has had several transportation and transit related articles in the last few days. The first, on different agencies and plans for commuter rail, discusses Metro vs. the freight rail district vs. the city of Galveston. All three proposed lines have flaws that could potentially make them as stupid as Austin's new line (Christof's word, not mine). Two stop at the 610 loop rather than getting into key core destinations because of inside-the-loop rail congestion. The third, Metro's 90a proposal, stops in Missouri City, rather than continuing to where all those med center workers actually are in Sugar Land. That's because Metro's service area does not include Ft. Bend County.

It's almost like all of them want to build a white elephant so they can then point to the low ridership and make an argument to sink a lot more into extending it to where it actually should have gone in the first place. And nobody is talking about the critical problems of commuter rail in multi-centric, job-dispersed Houston: it is slower, less frequent, far more expensive, and drops you farther from your destination (in the heat, humidity, and rain) than express commuter buses in HOV lanes - all of which will be canceled as the rail lines get built. Why are we so hell bent on rushing headlong to a less convenient and more expensive transit system?

The second story is on the mayoral candidates and their mobility plans. Most of it sounds pretty reasonable. Except this:

[Peter] Brown said, “You can't serve a low-density city like Houston with a bus system.” (huh?!) He did not specify what he wants Metro to focus on instead, but called for the bus and rail systems to be “integrated.”

“We've got to have a rationalized plan for rail, and bus to feed the rail,” Brown said. “We've got to encourage people to live closer to where they work.”

If transit can't serve a low density city with buses, what the heck is the answer? It sure isn't rail, which is all about heavy density and ridership. And if you look at what happened after the Main St. line opened, "integrated" is a code word for "we're going to cut your convenient, direct, single-bus route and make you transfer several times to different trains and buses." Oh, and system ridership will drop sharply as a result. Great plan.

As far as "encouraging" people to live closer to work: it's not like people are idiots and want to live as far from work as possible. They weigh up a lot of factors to make their housing decision, including affordability, schools, home quality, amenities, and balancing the demands of two different commuters that are likely to change jobs several times. Every job center in Houston has tons of housing all around it - but there are very good reasons most of the employees in those job centers don't choose that housing.

Or maybe Peter wants the major employers of Houston to leave for the suburbs where their employees are, draining the city's tax base?

Lastly, there is this op-ed today urging Metro to take care with the light rail planning and construction. It ended with a challenge of sorts:

Our city's brightest minds and most experienced voices need to articulate a vision for the city's future growth and its transportation solutions that is in-step with the historic heartbeat of Houston.

For the record, mine is here and here.

Houston culture and brand, moving Americans, HSR, rail maps, and more

2009-10-01T19:31:00.001-05:00

Another set of smaller items:

HSR ridership rarely gets anywhere near projections, creating serious revenue shortfalls. "High speed rail is an unprofitable train wreck."
Houston ranked as the #8 cultural capital in America, according to Forbes. Hat tip.
Americans are relocating less (mainly because of the economy and difficulty selling homes), but when they do, Texas is a favorite. And DC. At current trends, all of America will eventually move to DC and work for the federal government or a contractor within a few decades (OK, I made that up, but it feels like it). Hat tip to Sarah.
Christof maps out high-speed rail vs. local commuter rail in 5 major regions of the country, including Texas. Check it out for the amazing maps alone. Click on the maps once to have them fill your browser screen, then again to zoom in. The detail is incredible. Metro should contract out their route system map-making to Christof.

I heard an interesting new candidate for Houston's tag line/brand/identity the other day: "Houston: A New Energy" (credit to Marc Nathan). I like that a lot. Plays off the whole Energy Capital thing, but also hints at initiatives in alternative energy, nanotech, and biotech. It also reflects the entrepreneurial energy here. Another variant would be something like "Warm Energy" to reflect the hospitality/friendliness - but that one doesn't work as well. What do you think? I'd love to hear other suggestions in the comments.

How Houston stacks up on income and cost of living

2009-09-28T17:39:00.000-05:00

I recently came across this document from Atlanta with a lot of interesting data comparing 17 large and/or fast-growing American metros, including Houston (hat tip to 'Rail Claimore'). Some observations:

We're one of only three cities that are both very large and the fastest growing since 2000, along with Atlanta and DFW. I don't think it's a coincidence that all three of the large, fast-growing metros are below the national cost-of-living average, and all of the large, slow-growing metros are well above it.
At 89.4 (vs. 100 for the national average), we have the lowest cost-of-living index of any of the metros, particularly dominating the grocery, housing, and misc goods and services categories (all three of which I think are directly related to our no-zoning, low regulation, hyper-competitive development environment). We're near the best in transportation and health care. Our biggest weakness is utilities, which is not surprising given our climate.
Speaking of utilities, wouldn't the smart growth argument say that density reduces those costs? Yet NYC has the highest utilities index of all of the metros at 145.
Our per capita income rose a respectable 15.2% from 2000 to 2005 to $39,199, above CPI inflation at 13.4%. Oddly, Dallas, Austin, Chicago, and especially Atlanta lagged far behind. I think that may partially reflect the dot-com crash.
Austin, Atlanta, Dallas, Chicago, and Philly lost boatloads of higher-paying jobs. Again I suspect the dot-com crash. Houston held up because we had less exposure to the tech crash.

Overall, Houston ranks strongly, even with most of the data before the run-up in oil prices. But a lot has happened since this 2005/2006 data. I imagine the housing crash combined with the recession would rearrange a lot of these rankings, although I still suspect Houston would hold up well (and Austin and Dallas would probably look better than they do here). If you come across similar documents with more recent data, please pass them along. Thanks.

Why the feds should stay out of high-speed rail (and most transportation)

2009-09-24T19:34:00.001-05:00

Set aside for a minute whether high-speed rail (HSR) makes sense or not on a cost-benefit basis. Regardless of whether it does or not (and some smart people are arguing not), I'd like to make the argument that federal funding has no place in HSR. Instead, it should be left to individual states or regional state coalitions.

The federally-funded interstate system was originally conceived for defense purposes - rapid mobilization - after Ike saw the German autobahns. Freight and people movement were obvious beneficiaries, over short, medium, and long distances. It is a comprehensive network that crosses state lines, which argues for federal involvement. The government made the minimal investment it had to make - road beds - and people/companies paid for vehicles and fuel. Fuel was taxed to pay for it all. If EZ-tag technology had been available at the time, I suspect they would have tolled it all instead to pay for it.

Airports followed a similar arrangement: government provides the landing strips and terminals while private companies provide the vehicles and fuel. Passenger ticket taxes pay for the infrastructure. As airports are a local decision, they are (mostly) paid for locally, although regulated federally for standardization and safety.

HSR is targeted at medium distances only, making it more of a state/regional decision (i.e. a small collection of states). It also requires huge subsidies, as the government provides the track, cars, and energy. There is nothing directly related that can be taxed to pay for it (like fuel taxes for roads and passenger ticket taxes for airports). You could try to tax the rail tickets, but if they were fully priced they would not attract nearly enough riders. So no matter how you slice it, in the end the government (i.e. taxpayers) will be paying the majority of the cost of moving each passenger. The infrastructure cost cannot be covered by direct user fees, as demonstrated in other countries.

Rather than compare HSR to the interstate highway system, the better analogy would be airports. Imagine if California said, "Feds, give us money to build a few airports in key CA cities and provide a subsidized government-run airline to provide frequent intra-state service where tickets are priced way below cost." Put that way, people would recognize the idea as absurd, and tell California to do it themselves if they think it's such a good idea.

The problem is that a simple program that made sense at the time - a federal gas tax to build an interstate highway system - has evolved into a Frankenstein monster of massive federal involvement in enlarged urban freeways, local rail transit, and now high-speed rail - areas where they simply do not belong. Local transportation planners have shifted decision making from "What are the best cost-benefit investments we can make to move people in our area?" to "How to do we grab our 'fair' share of the federal pie, regardless of whether or not the project is something we would consider with our own money?" And that is leading to a lot of boondoggles being built around the country, culminating recently in the famous Bridge to Nowhere in Alaska.

The answer? The feds need to get out of the transportation business beyond minimal maintenance of the interstate highway system (the basic four lanes - not the expanded urban freeways). Let local entities make local decisions on transportation investments, including funding, and a whole lot of waste will magically disappear.

Update: This has been re-posted over at New Geography.

HSR, carbon impact, tech jobs, low stress, NPR, and more

2009-09-21T18:01:00.001-05:00

Tonight I just want to pass along a few smaller items of interest:

Christof has a couple of interesting new posts on his Intermodality blog, including ten transportation opportunities of the next mayor and third-generation commuter rail.
The Wall Street Journal has a special section story today about the potential negative economic effects of carbon cap-and-trade on Texas.
America 2050 has a new report out recommending priority high-speed rail corridors (overview blog post). I find it strange that Houston-Dallas is the 10th highest ranked city-pair, ahead of all Chicago pairs, yet it still recommends HSR for Chicago before Texas. While I'm a pretty strong HSR skeptic, I appreciate their point that the two highest priority corridors are Boston-DC and the California coast, and if any HSR is going to happen, that's where the focus should be instead of sprinkling the money around the country in places that make far less sense. Of course, I also believe those places should pay for it themselves, rather than with federal money. Also check out the per-capita GDP rankings on pg.4, where Houston places a very strong 4th behind SF, DC, and Boston - and well ahead of NYC and Dallas. Hat tip to Victor.
Houston is a top 10 city for tech jobs, according to U.S. News World and Report. Note the lack of Austin or Dallas on the list, which surprised me.
An article on how Houston real estate is so much healthier than Phoenix. Hat tip to Jessie.
Houston is low stress compared to other major cities according to Forbes, ranking 32nd out of 40. Other Texas cities were even lower stress, with Austin the lowest. And the three larger cities than Houston ranked at the top: Chicago, LA, and NYC.
NPR on the international popularity of HCC. Hat tip to Christopher.

"Take Houston Community College. Thanks in part to an aggressive outreach campaign, the school has the highest percentage of international students of any community college in the U.S."

Finally, if you haven't heard already, NPR was doing a series of stories on Houston last week (hat tip to Mark). This is the lead story, which contains links to the others. Two stories will particularly appeal to readers of this blog: this one on our approach to growth (including great comments by Rice prof Stephen Klineberg and Harvard professor Edward Glaeser), and this interview with Mayor White, which include discussion of energy efficiency, Ashby, light rail, and TOD.

I already mentioned that last item at the end of a post last week, but thought I'd mention it again since it was sort of buried at the bottom there.

Critiquing Gene Locke's Transportation Plan (and HRG, NPR)

2009-09-18T17:54:00.001-05:00

Today I attended mayoral candidate Gene Locke's transportation briefing, during which he unveiled his transportation plan, which had the usual stuff (improve regional coordination, get more state and federal money, etc.) but also introduced a few novel items (including the cute C.H.O.I.C.E.S. acronym).

I also had the opportunity to attend the Quality of Life forum last evening, in which all the major mayoral candidates contributed their particular policy dish to a political buffet intended to appeal to the most democratic palette possible. Over the course of the evening, the mayoral candidates spoke about parks, trails, trees, water, visual blight, etc. So this one is easy to sum up: "We all support improving quality of life within tight city budget constraints." No news there.

Here are some of the Gene Locke plan points that jumped out at me, most of which I support:

Creating a "City Department of Mobility" and a Director of Mobility. Long overdue.
Syncing traffic lights across the city as well as regionally. Fantastic idea. Although, good luck with cities like Bellaire, West U., and the Villages, which seem to revel in making it as slow as possible to cross their cities. Of course, their motivation is understandable: they don't want the Houstonians' traffic. But then, we do control their water supply, so we might have some leverage there...
Expanding HOV service, which would mean longer hours, more Park-and-Ride centers, and, most importantly, increased service to business centers outside of downtown like Uptown/Galleria, Greenway Plaza, the Medical Center, and the Energy Corridor (a tough one because of widely spaced destinations).
Getting real-time bus status online. Locke mentioned an iPhone, but I think any plain cell phone should be able to text a stop number to Metro and instantly receive a text reply with the bus routes headed to that stop along with their estimated times of arrival.
Bring back the downtown trolleys. (And maybe also in Uptown and the TMC-Rice Village area.)
"Reducing bus fares to increase ridership." That one's a direct quote from the plan, which went on to say that the city would "also look at a pilot program to eliminate bus fares at certain times" (like rush hour). Similar to Bill King's op-ed, this concept could substantially increase ridership, reduce cars on the road, and speed trip times (no fumbling for money).
Promoting transit-oriented development, or "TOD," which can help accommodate growth without adding much traffic. Significantly, Locke does not support government planning to dictate how or where to build. "Let the market figure it out." Huzzah!
Accelerating commuter rail. My long-time readers know I have mixed opinions when it comes to commuter rail. Some lines may make sense in narrow circumstances, but economics tend to force the shutdown of any express buses that even remotely compete with the rail line, often leading to longer commutes for riders (more stops and transfers, slower net speeds, longer walks to their final destination).

In Q&A, Locke endorsed continuing Mayor White's Safe Clear program, a very successful program recently backed up by a study. As far as what to do with the 25% of Metro's revenue that they turn over for "general mobility" (i.e. street improvements), he believes that decision will be decided by the voters. Personally, he would like to see some flexibility in how it's spent to improve regional mobility. I don't see any of Metro's member cities wanting to give it up, including Houston Public Works, despite Metro's desire to redirect it to transit/rail.

Overall, a pretty good plan.

Speaking of mayoral candidates, Houstonians for Responsible Growth came out with their endorsement yesterday of both Annise Parker and Gene Locke, while, not surprisingly, taking some shots at Peter Brown. Chronicle coverage and Brown response here. Even though some people believe HRG = "evil developers against neighborhoods," they're really a broader collection of well-intentioned people that want to preserve the strengths -- including vibrancy, competition, and affordability -- of Houston's historical free-market approach to development. That includes reforming and strengthening deed restrictions to protect neighborhoods. And don't forget that developers transform underutilized land into better and higher uses by increasing property value, which adds to the city's tax base to support public safety, schools, libraries, parks, flood control, and infrastructure investment and renewal.

Finally, if you haven't heard already, NPR is doing a series of stories on Houston this week (hat tip to Mark). This is the lead story, which contains links to the others. Two stories so far will particularly appeal to readers of this blog: this one on our approach to growth (including great comments by Rice prof Stephen Klineberg and Harvard professor Edward Glaeser), and this interview with Mayor White, which include discussion of energy efficiency, Ashby, light rail, and TOD.

Houston a "World Capital of the Future"

2009-09-13T18:17:00.000-05:00

Joel Kotkin has an article on the "World Capitals of the Future" (originally in Forbes), focused mainly on emerging countries, but with a nod to a handful in North America, including Houston (Forbes detail page).

Of course, none of these cities' wealth or economic power have passed leading global centers like Tokyo, London, Paris, New York, Chicago, Los Angeles, Seoul, Singapore and Hong Kong. But our list of emerging global cities is clearly gaining on them – and with remarkable speed.
...
Not all our emerging cities are in the developing or former Communist world. North America boasts at least three genuine emerging world cities: Calgary, in Canada, and Houston and Dallas. These regional economies have been built around energy and expanding industrial power. They also have enjoyed rapid population growth. Last year, Houston and Dallas grew more than any other metropolitan region in the country; over the past decade, their populations have increased six times more rapidly than New York, Los Angeles, Chicago or San Francisco.
But it's not all a demographic game; cities like Phoenix and Las Vegas have similarly enjoyed rapid growth but do not fit on the rising global cities list. The key difference lies in the Texan cities' rising corporate power. Houston, with 27 Fortune 500 firms, has passed Chicago in the number of Fortune 500 companies, while Dallas, with 14, ranks third. Together, the two Texan cities account for about as many Fortune firms as New York, once home to almost a third of the nation's largest companies.
...
These emerging world cities also have survived the housing crisis much better than their national competitors. The growth of India and China has created an ever-richer market for commodities, as well as expertise residing in places like Perth, Calgary, Dallas and Houston, much of it built around commodity and resource extraction. The evolving ties between burgeoning world cities also spill over into the growing tourism industry in Perth and the expanding medical service complex in Houston.

Do you think he missed any? Atlanta? Others? Arguments for or against any of the choices? Let me know what you think in the comments.

Hat tip to Frank.

Why it's good Houston lost the 2016 Olympics, plus job sprawl, traffic, and HSR

2009-09-03T22:29:00.001-05:00

I recently came across this story on crumbling public support for the 2016 Olympics in Chicago, as the costs, risks, and hassles become more clear.

The Tribune/WGN poll is the first measure of public sentiment since Daley did an about-face in June, saying he would sign the standard host city contract giving the city full financial responsibility for any losses -- a move that triggered a firestorm of criticism. Until then, the city had been lobbying for amendments to the contract that would recognize the city's limited guarantees.

Poll respondents made it abundantly clear that they disapprove of Daley's promise of an unlimited guarantee in the event the Games lose money, with 75 percent opposed.

In a city already upset over the privatization of parking meters and worried about further cutbacks in government services, those respondents who talked to reporters expressed concerns about the economy, the cost of hosting the Games and traffic congestion.

Even a majority of those who favor the Olympics opposed using taxes to cover losses and were against the unlimited guarantee.
...
...experts said the findings could hurt Chicago's chances.

"When less than half of the folks polled indicate they'd be willing to support the Olympics, that's certainly not an enthusiastic mandate for bringing the Games to Chicago," said sports finance expert Dennis Howard of the University of Oregon. "I can't speak for the IOC members who will be making the decision, but I'd be fairly certain this would not help the cause for Chicago."
...
The poll comes a month before the International Olympic Committee selects the host city for the 2016 Olympics. Chicago is competing against Tokyo, Madrid and Rio de Janeiro.

Sorry Chicago. I think they call it the "Winner's Curse" (they won the U.S. contest). London is also dealing with serious budget problems for the 2012 Olympics. All in all, it looks like a good thing we were bypassed.

Moving on to a few smaller items:

A Brookings study on increasing 'job sprawl', a big reason commuter rail makes less and less sense as fewer and fewer people (proportionally) work downtown. Some of the core points:

Only 21 percent of employees in the top 98 metro areas work within three miles of downtown, while over twice that share (45 percent) work more than 10 miles away from the city center.
Employment steadily decentralized between 1998 and 2006: 95 out of 98 metro areas saw a decrease in the share of jobs located within three miles of downtown.
In almost every major industry, jobs shifted away from the city center between 1998 and 2006.

From Reason:

Study: Reducing Traffic Congestion Would Spur Huge Economic Growth
How much would your city's economy grow if its roads were free-flowing instead of jammed? A new Reason Foundation study by David Hartgen and Gregory Fields examines how reducing gridlock would increase economic output and worker productivity in eight cities across the country. In Dallas, getting rid of traffic congestion would boost the economy by $46 billion a year. Denver would get a $38 billion increase in Gross Regional Product if it had free-flowing traffic conditions. Atlanta, Charlotte, San Francisco and Seattle would all see more than $10 billion a year in economic growth if they prioritized infrastructure projects and eliminated severe traffic congestion.

Sorry, nothing specific on Houston, which I guess means they think we've done relatively well on freeway investments compared to other cities (juicer targets for their analysis). Still, I'm sure we'd see big gains from reduced traffic congestion too (probably comparable to Dallas' $46 billion/year).

And finally, Newsweek's Robert J. Samuelson joins the growing chorus of critics of high-speed rail.

I'm on vacation next week (Chicago, WI, MN), so probably no more blog posts until sometime the week of Sept 14th.

Is a 'SmartCode' the answer to Ashby?

2009-08-31T18:41:00.000-05:00

Andrew over at neoHouston has a really thought-provoking and detailed post (including a chart and map) on how a 'SmartCode' could be applied in Houston to prevent problems like the Ashby high-rise. It also includes a wonderful defense of Houston:

On the other hand, many in Houston, including myself, believe that Houston’s free-market culture is a key component of its success as a city. While it may be messy, there’s no denying Houston’s role as the Opportunity City. Providing opportunity means staying clear of heavy-handed regulation.

For three generations other cities have regulated land use with conventional zoning. The principle of conventional zoning is this: by separating all the major kinds of land use, the “most sensitive” land uses are protected from the offenses of the “cruder” land uses.

Historically the purpose of these ordinances was to prevent new factories from dumping heavy pollution on previously non-industrial communities – thus wrecking their property values, and often their health and safety. The goal was to push smokestacks out to specific “zones,” and by defining these zones to allow people who didn’t want soot falling on their head to plan their construction activity accordingly.

However, as time went by this concept has morphed and grown into a very heavy set of regulations. In most cities today, the government essentially draws a map dictating what is allowed to be built, where it is allowed to be built, and what it has to look like. The state is therefore trying to predict the market, which never works well. This results in constant conflict between property owners and developers (who want to build what will sell) and the city (who “knows better” what should go where).

Here are my reactions to several of the issues he raises:

Developers can't predict if the city will choose to 'attack' their development with obscure and arbitrary regulatory enforcement: absolutely a problem that must be addressed. Kudos to Houstonians for Responsible Growth, which is pushing this issue hard.
Land speculation is preventing dense transit-oriented development near the rail lines: the market will eventually work this out, although I support the idea of higher property taxes for vacant and underutilized land in the urban corridors to incentivize development.
Our 'one-size fits all' parking and setback regulations that tend to create the same type of low-density, car-oriented development everywhere: Although I do think that is what the market mostly wants in hot-and-humid Houston, I agree they need to be relaxed, and the new urban corridor regs are definite step in the right direction.
The need to improve street connectivity to disperse traffic as density increases: Yes! And that is one benefit I see coming from the city's revival of the traffic impact analyses on new developments - it just needs to be less arbitrary and encourage reasonable mitigation without being onerous. And the city needs to step up and do its part to plan the street connectivity improvements as the growth warrants it.

On the surface, his SmartCode proposal seems pretty reasonable, but I have some serious concerns (beyond just the linkage with 'smart growth', which has been very problematic). Overall, this seems like extreme overkill relative to the problem - the proverbial "elephant gun to kill a mosquito." As I've pointed out before, are 'out of scale' buildings really that big of a disaster? Look at the towers scattered around River Oaks, Montrose, the Museum District, Greenway, and Uptown. As far as I can tell, they have had no substantial negative effect on property values or quality of life in those areas - and I suspect we will eventually see the same result after the Ashby tower is built.

He believes the necessary 'upcoding' would happen easily over time to accommodate growth, but would it really happen or would the NIMBYs block it? I suspect if we had had the SmartCode in place 50 years ago, Uptown, Greenway, and the TMC would have never developed (not to mention the Energy Corridor, Westchase, or Greenspoint) - much to Houston's detriment (yes, some of that would have gone downtown, but I suspect more of it would have gone further out).

There is a huge risk to taking a relatively successful system and going for a radical overhaul - whether that change is a SmartCode or the previous call for 'comprehensive planning'. It could be hijacked by all sorts of interests (especially NIMBYs, since it would be required to go through a zoning vote). It could create regulations that 'solve' all sorts of problems we don't have and result in unintended consequences. Yes, our process of handling deed restrictions need streamling and refinements, as do TIRZs, but do SmartCode special districts really add anything new? The T1 and T2 designations are barely discussed, but would generate huge controversy in this town, as witnessed by the problems created the last time Council tried to shut down development in the floodways and flood plains. Now take that circus times a hundred for something of this scale. What a nightmare.

The answer, in my mind, is taking our existing, successful system and incrementally tweaking it to fix the specific problems we want fixed, several of which are discussed in his post.

Kudos to Andrew for putting a bold proposal out there for discussion (many parts of it I agree with), not to mention a great defense of Houston's current approach, but, to abuse a cliche, why (over) fix what ain't (that) broke?

CA disease, DC danger, Ashby, rail, peak oil, toll roads, free buses, and more

2009-08-27T16:21:00.000-05:00

Smaller misc items and some of my recent Opportunity Urbanist posts:

In catching up with my badly backlogged newsfeeds, I found several items on the Antiplanner of interest:

A ranking of states by both personal and economic freedom, where Texas scored very highly on both.
A developer claims that Houston is too competitive and, despite our reputation, is not actually all that "developer friendly" because of the difficulty of making profits in such a competitive environment. In most other cities, substantial regulations create "barriers to entry" that limit developers to a small oligopoly with the resources to push through the regulations, and the lack of competition substantially boosts their profits
How the 'Prius Effect' undermines the environmental case for light rail
AP/Cato and Glaeser sum up the problem with high-speed rail: the costs are more than double the benefits even with generous assumptions. Hat tip to Barry.

Just passing along without comment or endorsement: a former MIT prof gives the arguments against peak oil theory in the NY Times.
Joel Kotkin has a piece on the dangerous rise of the powerful centralized capital (DC) over everybody else, including major commercial centers like NYC and Houston ("Rome vs. Gotham"). Hat tip to Holmes, who suggested Francisco D’Anconia’s “Money” speech in Atlas Shrugged by Ayn Rand as commentary:

“When you see that trading is done, not by consent, but by compulsion--when you see that in order to produce, you need to obtain permission from men who produce nothing--when you see that money is flowing to those who deal, not in goods, but in favors--when you see that men get richer by graft and by pull than by work, and your laws don't protect you against them, but protect them against you--when you see corruption being rewarded and honesty becoming a self-sacrifice--you may know that your society is doomed.”

Houston on U.S. News' "America's Best Places to Find a Job 2009"
CNN notes that foreclosures are slowing in Houston, that we're extremely affordable, and that future housing risk here is very low.
Bob Poole at Reason analyzes the past, present, and future prospects for private toll roads in Texas.
NYC ran a free transit bus experiment, and found substantial speed improvements because of faster boarding times: 24%, meaning a bus could make four runs in the time it currently takes to do three - which of course would be helpful for handling the extra demand due to free service. Since the farebox is typically only small percentage of overall transit revenue, this would be a relatively small loss for a big gain in service. More on the pros and cons of free transit here. Hat tip to John.

And here are some recent posts on my Opportunity Urbanist blog over at the Chronicle:

Have a great weekend.

Houston’s Texas Medical Center May Outgrow Downtown Dallas

2009-08-23T09:35:00.000-05:00

A quick pass-along from Bloomberg. A few good excerpts:

Houston, the fourth-largest U.S. city, has been buoyed by construction in the Texas Medical Center, an area with 3,000 job openings that is likely to become larger than Dallas’s downtown, said Jeff Moseley, chief executive officer of the Greater Houston Partnership.
As a result of the medical center’s expansion, Houston may emerge from the economic decline quicker than the rest of the nation, Moseley said today in an interview.
...
Houston, which is known as the energy capital of the world, sees about 40 percent of its economy still coming from oil, natural-gas and renewable energy industries. Many of the 3,000 energy-related establishments based in Houston, including Apache Corp. and Schlumberger Ltd., have contributed to the loss of thousands of oil and gas jobs since December in the state.
‘Nothing Like It’
The Texas Medical Center, located less than 4 miles (6.4 kilometers) from downtown Houston, continues to gain in size. Expansion plans over the next five to six years have the cluster of hospitals, medical schools and doctor offices outgrowing the current size of downtown Dallas, Moseley said. It’s already larger than the combined downtown districts of Texas cities Fort Worth, San Antonio and El Paso, he said.
“There’s nothing like it on the face of the globe, nothing even close,” he said. “It has been a tremendous help to this economy.”
The Texas Medical Center, which is made up of 47 institutions, has 72,600 workers, according to its Web site. The area occupies more than 1,000 acres and has 5.1 million patient visits a year. The center has $7.1 billion in approved building and infrastructure investments.

When they say "largest", they mean sq.ft., not jobs. See this graph on sq.ft. growth vs. downtown Dallas and Houston (which it will also pass in a few years). According to this fact sheet, downtown Dallas has 135,000 jobs, which is 20% of all jobs in Dallas (that's probably the city of Dallas, not the metro or DFW). The last job count I heard for TMC is 75,000 with rapid growth to over 100,000 by 2014. Why the space vs. jobs discrepancy? Normal commercial space is pretty much all for employees, while medical facilities use lots of space for patients and visitors. Still, nothing to sneeze at, and an incredible economic pillar and growth engine for Houston.

Hat tip to Jessie.

My new Chronicle blog, Opportunity Urbanist

2009-08-20T18:10:00.000-05:00

The Houston Chronicle recently asked me to write a City Brights blog for them, and I couldn't say no to such a great opportunity to reach a whole new audience. I started it earlier this week and they put me on the home page the first day, which I have to say was pretty cool. I also have the option over there to react to current news stories and they will link to my reaction from the story itself, which can certainly channel a lot of additional traffic. I decided to name it "Opportunity Urbanist" to differentiate it from Houston Strategies, but the topics covered will be the same.

I plan on continuing to support both blogs. Because Houston Strategies has an email list associated with it, I'll keep the infrequent longer posts/essays over here (cross-posted there). There I'll try to do more frequent smaller posts (something that would be annoying here with my email subscribers), usually reacting to something in the news or posted on another blog (something I'd like to do more of). Seeing as it's a whole new set of readers, I'll also repost some of my older 'best of' highlight posts from the Houston Strategies archives - so if you haven't been with me since the beginning (2005), I'd recommend keeping watch over there to catch some of my better early stuff. So Houston Strategies readers and email subscribers don't miss out on the smaller posts there, I'll usually bundle them up into a single long summary post over here from time to time. I'm also well aware that Hearst can decide to shut that blog down at any time, so I want to make sure the most important content is replicated to Houston Strategies for posterity (and Google indexing and searching, of course).

I know that sounds complicated, but we'll figure it out as we go along. If you want to be sure to catch everything, just add both RSS feeds (HS, OU) to your newsreader (I'm a big fan of Google Reader).

As always, thanks for your readership and support.

Opportunity Urbanist