January 24, 2008

Harassing the Bloggers

The town of Oro Valley, Ariz., has backed off a demand that a 71-year-old resident register his blog as a political action committee after he used it to endorse two candidates who were running against incumbents.

A number of attorneys in Arizona, including Clint Bolik with the Goldwater Institute, agreed the town was completely out of line and that Art Segal, whose blog, www.letorovalleyexcel.blogspot.com, is often critical of local government policies and activities, is well within his First Amendment rights to support of any local candidate.

Bloggers such as Segal are not required to register with the government to express an opinion unless they cross the boundary into financial support, Bolick told the Arizona Daily Star.

“His blog is not a political action committee,” the attorney said. “He is simply a citizen expressing his political views.”

The clear intent of the town was to silence political opposition, Bolick said.

Oro Valley changed its mind after awkwardly defending the move, claiming that, upon receiving a complaint about the site from an anonymous citizen, local election law required it to demand Segal register. Yet one check of the rules and officials would have learned that they don’t apply to bloggers.

What’s good is that, in the end, it’s another case where Internet blogging is afforded First Amendment protections. Blogging is a legitimate form of journalism and commentary. There have been more organized attempts to silence bloggers by attempting to argue that they are not truly “media” of not “professional journalists.” Witness Apple’s lawsuit to close down Think Secret, which excelled at doing exactly what I and my one-time Electronic News colleagues were encouraged to do week after week—scoop insider company and product news. Apple “won” that suit by succeeding in closing the site. Or was it simply that Nicholas Ciarelli, who as a 13-year-old had Apple’s PR people tearing their out, grew up and had other things to do, like attend Harvard, reportedly with some cash from the Apple settlement?

So, on some level, it’s gratifying to see a town’s attempt at blogger intimidation turn out to be acknowledged for the petty power play it was.

The whole affair left Segal — who said he has given no money to the candidates he endorsed months before hearing from the town — with a bad taste in his mouth.

The resources that town officials spent trying to strong-arm him into compliance would have been better used to address issues important to Oro Valley residents, he said. "It's just another example of the wastefulness that this town has shown a propensity to do on much too many occasions," Segal said.

Posted by steve.titch at 02:20 PM

January 10, 2008

Eliot Pitbull Spitzer's New Target

You could knock me down with a feather: New York's Democratic Governor Eliot Spitzer – a big government liberal best known for using dirty tactics to terrorize political opponents and company CEO’s – proposed a bold new plan to cap property taxes in his recent state-of-state address. The plan, which seeks to impose a "fair and effective cap" on school taxes in New York, is remarkable for two reasons: One, it has been proposed by a big government liberal. Two, it will drive teachers unions, a key Democratic constituency, totally bonkers. But the governor seems unfazed. He insists that though the cap is a “blunt instrument,” it is necessary to force “hard choices and discipline when nothing else works” to rein in wasteful spending by schools.

Ronald Reagan couldn't have said it better!

Read New York Post columnist, E.J. Mcmahon’s, take here: http://www.nypost.com/seven/01102008/postopinion/opedcolumnists/eliots_excellent_idea_804389.htm?page=2

Posted by shikhad at 07:44 AM

January 08, 2008

RFID “For The Children”

In another ill-conceived government effort, no doubt designed “for the children,” the Middletown, R.I., school district plans to place RFID chips in the backpacks of school kids to track when they get on and off the school bus.

The idea has the American Civil Liberties Union, not to mention the usual anti-RFID crazies, riled up. I don’t like the idea either, but for different, and I hope simpler, reasons.

Look no further to find that the company supplying the technology to the trial is run by the brother of the Middletown school district’s facilities director. That alone is reason to spike the plan.

Steven Brown, executive director of the ACLU Rhode Island chapter, is right when he calls the plan “a solution in search of a problem.” Even if you think RFID tracking is a good idea, the Middletown approach is hardly efficient – all the chip will record is when a child got on and off the school bus. (What about kids who walk or carpool to schools?) And even then, what’s really being tracked is the backpack, not the kid. Given the upper-middle class paranoia that fuels such government-sponsored "let's-track-our-children" ideas (Middletown neighbors tony Newport), it's easy to imagine the cross-departmental chaos a group of mischievous 10-year-olds could create simply by exchanging their backpacks. Above all, this plan should be opposed simply because it is poor use of taxpayer money. It won’t make children any safer. It’s a matter of local government officials letting themselves be seduced by tech sizzle.

What’s regrettable is that ideas like this bring the tinfoil helmet crowd out of the woodwork declaring that RFID is an automatic identity theft and privacy threat. While we should be careful about proposals to use impose RFID for personal tracking (even for our own “safety and security”), it has many beneficial applications. Yet hysteria over the technology has already seen efforts such as California’s ill-conceived proposal (vetoed by Gov. Schwartzenegger), to ban all commercial investment or development of the technology within the state.

Much of this legislative action is based on misperceptions over what RFID can and cannot do. For more clarity, see my post from about a year ago.

Posted by steve.titch at 02:17 PM

October 31, 2007

Govt. Bureaucracy Hampers Fire Efforts

Another fire season has resulted in tragedy in Southern California and, once again, the federal, state, and local governments have shown that they still haven't learned how to deal with the threat. By now, you have probably heard about a lot of the bureaucratic bungling and red tape that impeded response efforts. As a San Diego resident, I had a front-row seat to the ineptitude. For example, despite the fact that the city is surrounded by three military bases, military assets went unutilized or underutilized. State rules require each federal helicopter to carry a licensed "fire spotter" from the California Department of Forestry and Fire Protection (Cal Fire). Unfortunately, Cal Fire didn't have spotters available, so nearly two dozen Marine, Navy, and California National Guard helicopters remained on the ground. In addition, two of the National Guard's C-130 cargo planes were unable to help because they still have not been fitted with tanks to carry thousands of gallons of water or fire retardant, despite promises to do so four years ago after the Cedar and Paradise fires ravaged the area. (For more details, see this Associated Press story.) Meanwhile, government officials from the president to the governor to the mayor to the County Board of Supervisors to spokesman from various government agencies constantly held press conferences where they stood around and congratulated each other on what a great job they were doing.

Some may say that the problems in responding to the fires in San Diego and elsewhere were just a matter of poor leadership. While this is true to some extent, I think there are problems with allowing government to handle such issues in the first place, problems that no change in leadership can fully address. The problem can be illustrated in the difference between public and private property and the different incentives of public land managers and private property owners. Government land management tends to be reactive, while private property management is proactive. Why is it that we never hear about the government clearing overgrown brush, creating fire breaks, or conducting controlled burns throughout the year, rather than responding only after there is a crisis and throwing money at the problem when it is too late?

Fire prevention is essentially about risk management and property protection, two of the things that free markets handle best! Author and columnist Lew Rockwell recently wrote an article on this issue. According to Rockwell,

Are we under the impression that private markets can't handle risk management? Private markets specialize in protection of property, particularly against natural risks. If the land were privately owned, it would be protected against burning through better management. If it had to be burned, the burning would be controlled. Unexpected events like droughts and winds would be calculated into management decisions.

What's more, there would be serious liability issues. Any owner of property who let fires rage would be directly responsible for imposing fires on others. This is the way markets work. If my bathtub overflows, floods my house, and then the waters flood my neighbor's house, I am responsible via my insurance policy. So, yes, there would be a price to pay for fires on your land that harm others' property.

What do we have today? We have fires that are no one's responsibility.

Perhaps it is time to rethink allowing government to manage our fire prevention efforts.

Posted by adam at 05:39 PM

September 13, 2007

Broadband in the Sticks

Market failure – two words heard when discussing the spread of broadband to small cities and less densely populated areas.

Market failure – the chief reason municipal broadband activists give when citing the need for government to fund infrastructure projects like Utah’s UTOPIA. There are some areas of the country, they say, where private investment won’t go. There are some areas of the country, they say, that offer no profitability to attract enterprises. The government, dammit, must step in.

Oh, really?

In catching up with my e-mail alerts, I came across “Zayo Plans Broadband Success in the Boonies” by Carol Wilson in Telephony OnLine. Seems like one entrepreneurial start-up sees opportunity in small markets.

Zayo Bandwidth is getting its start with the acquisition of a series of regional fiber networks, and founders Dan Caruso and John Scarano have lined up $225 million in funding from major venture capital firms, including Battery Ventures, Centennial Ventures, Columbia Capital, M/C Venture Partners and Oak Investment Partners. Caruso and Scarano are both veterans of ICG Communications and Level 3 Communications and are strategically positioning their new company to cover areas they believe are not well-served today.

The initial two acquisitions are PPL Telcom, an Allentown, Penn., company that serves the Northeast via a 4600-route-mile fiber network and Memphis Networx, a 200-route-mile fiber network serving that metro area. In addition, Zayo has definitive agreements in place to buy Indianapolis, Ind.-based Indiana Fiber Works (IFW) and Minneapolis, Minn.-based Onvoy.

“Our strategy is to acquire unique fiber-rich assets throughout the country to create a company that provides large bandwidth responsibly, quickly and reliably,” Scarano said in an interview. “We are being selective in the markets we invest in. Where we are buying the assets, there is limited deep metro competition. We generally do not have assets in NFL cities, but mostly in Tier 2 and Tier 3 cities that have ties to NFL cities. By investing in those areas where incumbents have not invested and where other competitive carriers have largely not invested, we will be able to keep up with the bandwidth demands of businesses in those areas.”

For those who have followed the muni broadband controversy, the fact that one of Zayo’s first investments was in Pennsylvania, where state legislators passed legislation preventing municipal government from setting up competitive broadband operations, is particularly significant. And in Tennessee, municipalities face stern tests and voting requirements before they can set up broadband operations. Opponents said these laws would lead to entire regions missing the digital era. Free marketers said laws like these, in keeping governments out of the market, would make states more attractive to a new generation of broadband investors.

Let me know when Zayo hits Utah.

Posted by steve.titch at 09:22 PM

August 31, 2007

Missouri Court Weighs Wireless Tax

A Missouri court reportedly is close to a decision on whether the state is entitled to some $500 million in taxes from wireless phone service providers.

The case pits AT&T against 22 Missouri cities, and is one of a several suits between wireless carriers and Missouri municipalities that form a larger legal dispute dating back to 2001. The cities argue wireless carriers are legally liable for a utilities licensing tax that is paid by the state’s landline telecom companies. The cellular companies claim they are not utilities as defined by Missouri and should be exempt.

At stake is an estimate $500 million in taxes, plus interest and penalties that could add hundreds of millions of dollars to the bill, according to the Wall Street Journal, which referenced the Missouri Municipal League as the source.

But it is questionable whether wireless service, a deregulated, competitive business that relies far less on public easements and right-of-way than landline phone networks, really qualifiy as “utilities.” But far be it from the local tax man to shy away from stretching a definition, especially as more users migrate to wireless.

Here’s a snippet from Chad Garrison writing on the Stlog at the St. Louis Riverfront Times.

Moreover, as consumers have canceled their landline phones for wireless service, many cities have seen their tax base drop dramatically. Mulligan says University City collected nearly $800,000 in telecom taxes in 2000. Last year the city collected less than $500,000. Statewide, Mulligan estimates the amount of disputed or back taxes involving cell phones now reaches more than a half-billion dollars.

A ruling is pending from St. Louis County Circuit Court Judge Bernhardt Drumm Jr. on a motion for summary judgment in the AT&T lawsuit. On Sept. 12 Drumm is scheduled to decide whether the case merits class-action status. If it does, it would automatically include more than 200 other municipalities.

Aren’t wireless customers are already overtaxed as it is?

“Our customers are tired of having state and local governments treating them like ATM machines, so we are fighting on their behalf,” John Taylor, a Sprint spokesman, told the Wall Street Journal. He noted the average Sprint customer pays 17 percent of their bill in taxes.

A May 2007 study of telecom taxes published by the Heartland Institute that surveyed 59 U.S. cities found the average tax rate on wireless services was 11.78 percent. This ranged from 21.35 percent in Omaha, Nebraska to 3.62 percent in Carson City, Nevada. The wireless tax rate in Kansas City, Missouri, the only Show-Me State city examined in the Heartland study, was 10.14 percent.

Posted by steve.titch at 01:07 PM

August 14, 2007

Now there's four...

A fourth city has followed in Sandy Springs, GA's footsteps and hired a private company to provide virtually all services. Chattahoochee Hill Country, Ga -- a new community of about 2,500 citizens. Under the contract, CH2M Hill OMI will design, implement and operate all of the municipal processes and services that citizens will receive when the city formally opens Dec. 1.

Posted by geoffs at 05:50 AM

June 20, 2007

Another New Sandy Springs?

Residents of south Fulton County voted overwhelmingly in favor of forming a new city -- Residents of Chattahoochee Hill Country in the southwester corner of the county passed with 83 percent approval.

The municipality will have fewer than 3,000 people scattered over 33,000 rural acres. While a governing structure has not been decided for CHC its highly possible that they will follow in the footsteps of Sandy Springs, Johns Creek and Milton and choose a largely privately operated city.

Posted by geoffs at 12:35 PM

May 16, 2007

Montgomery, MD 1st County to Ban Trans Fat

Yesterday the Montgomery County (MD) Council passed a unanimous ban on trans fat and the local restaurants will be the ones to suffer for the dramatic changes they will be forced to make.

The Council divided trans fat into two categories: fried foods and baked goods. The deadline for removal of fried foods is 2008 since a "suitable" replacement has already been found. Since no such substitute has been found for baked goods, the Council decided to allow an extra year for implementation of the ban.

In an additional layer, the Council is allowing restaurants who are unable to meet the initial deadline to apply for an extension until 2010 but, in the meantime they are required to place a sign in the window notifying the public that they are cooking with trans fat.

Montgomery County, MD Council member George Leventhal said, "“The sign will alert customers that what the place is selling could be injurious to their health. That’s not a great incentive to dine there.”

See the story in The Examiner here: http://www.examiner.com/a-729632~Montgomery_passes_trans_fat_ban.html

Posted by akh at 05:03 AM

April 18, 2007

NLC Koolaid--personal debt edition

The National League of Cities is on the job to protect all you dumb schmucks from your poor financial management. They are pushing Maxed Out a "call to action to prevent exploitation of consumers in difficult financial circumstances. Cities, states and the federal governmetn all have roles to play in ending predatory business practices and helping workers, especially lower-wage workers, make the most of their hard-earned dollars."

We all know the government is expert and "making the most of hard-earned dollars"--they never waste a dime.

Not to mention the unmitigated gall of an elected official saying this.! No payday lender ever took as much of a poor person's paycheck as taxes do every single payday. Hey NLC, wanna help the poor, get behind smaller governemnt and lower taxes!

Posted by adrianm at 05:19 PM

April 04, 2007

Arizona Subsidy Backlash

In today's Wall Street Journal (password needed for full article), new legislation would put some restraints on the practice of dolling out millions in subsidies to attract development. Under the proposal, sponsored by Sen. Ken Cheuvront, a Phoenix Democrat, Arizona cities would lose a dollar of state revenue for every dollar they offer as incentives.

In the past five years, cities in the Phoenix metropolitan area have given more than $300 million in incentives to retail developers.

Proponents argue that developers will move to other states or that localities will lose tax dollars. First, move to other states? Phoenix is one of the fastest growing areas in the country, if they can't support development without subsidy we're all in trouble. Even the Arizona Republic agreed in a March 24th editorial, "With the region's growth machine at full throttle, success is a given." Second, so you have to spend $100 million, in tax dollars, in order to raise tax dollars. Great logic.

Posted by geoffs at 01:02 PM

March 22, 2007

Municipalities pooh-poohed this one, too

Someone or something disrupted service for 1,000 of the 3,800 users of Moorhead, Minn.’s municipal wireless network in late February, the Minneapolis Star-Tribune is reporting.

Let’s recall that early critiques of municipal systems mentioned that radio systems that use unlicensed spectrum, as Moorhead’s does, would be prone to interference from everything from microwave ovens to garage door openers to radio controlled remote control toys.

More chilling was the city’s response. Purely on the say-so of GoMoorehead network administrator Kevin McClain, who believed the source of the interference was a local residence, police shut down power to the house and executed a search warrant for “a directional antennae” (it’s not clear whether the newspaper or the search warrant made muddled the use of the singular indefinite article and the Latinate plural of antenna).

You’d need a lot of radio power to jam wireless service to more than quarter of GoMoorehead’s user base. Although the interference stopped when the power was cut off, police found nothing at the home and no arrests were made. So either the interference was unintentional or the home itself was not the source of the problem.

So what happened? Police are still investigating. The paper does not report the perspective of the hapless homeowner. My money’s on the likelihood that the interference stemmed from a problem within the network itself, not a malicious attack. It’s not as if Moorhead has no history of interference problems. Here’s a trade paper report from last October on Moorhead’s use of a device to detect and resolve RF problems.

“It's alarming just how much interference is out there that you don't know about,” Travis Durick, wireless network engineer for the city, told SearchNetworking.com.

At [Minnesota State University-Moorhead], cordless phones and microwaves often interfere with or create trouble on the wireless network, Durick said. In one instance, four small wireless surveillance cameras installed in one building tucked behind lighted exit signs interfered and made the wireless channel unavailable. Complaints came pouring in. Durick said he found the access point that wasn’t working and replaced it, but there was still no connectivity. Using Spectrum Expert, he was able to determine why the access point wasn’t transmitting and was able to fix the problem.

The city of Moorhead’s Wi-Fi deployment created a different set of challenges. In many cases, too many devices were operating on the same channel and were canceling one another out.

Either way, the city’s reaction was overkill and serves as another example of why municipalities shouldn’t be in the broadband business in the first place. Say what you want about the phone and cable companies, but they can’t turn off your electricity on a mere whiff of suspicion.

Posted by steve.titch at 02:31 PM

January 10, 2007

"One of the best ways to find funds is to look in other people's pockets"

That's what Atlanta Mayor Shirley Franklin said upon annoncing that she wanted to increase the city's general fund some $250 million or some 40 percent. Atlanta currently does not have a $250 million surplus - new taxes and fees are certainly on the horizon. The new funds will be used to improve city services and cover growing health care costs for its retirees -- a false dichotomy if I've ever seen one. In fact a Bain & Co report conmpleted for the city a few years noted that Atlanta spends more per capita for the same type of services than comparable cities...that they had a workforce that is 21 to 37 percent larger...and that they had not undertaken significant outsourcing or privatization of some central services functions such as information technology and motor transport services. Before looking in other people's pockets maybe the mayor should do some work herself bring Atlanta in line with comparable cities.

If that wasn't enough of a slap to taxpayers, Georgia Trend magazine, just named Franklin "Georgian of the Year." Among the chief reasons (and I couldn't make this up) “accomplishments like balanced budgets.” Its true that when she entered office she was faced with a looming deficit...at that time she pushed through a one percent sales tax hike and a hefty hike in property taxes to boot!

Posted by geoffs at 01:29 PM

December 11, 2006

Glamour boy mayors

America’s suburbs are growing in economic influence, while cities are declining. But these days when it comes to politics, big-city mayors often get promotions. That’s especially interesting because back when cities enjoyed more influence mayors often found that their upward political mobility stalled:

Here’s Joel Kotkin:

    But today, mayors across America are riding an unprecedented wave of upward mobility. Here in California, for example, the men most widely touted to become governor once the Terminator terminates are not any of the myriad of statewide Democratic officeholders, but two high-profile mayors, San Francisco's Gavin Newsom and Los Angeles' Antonio Villaraigosa.

    And this is not just another weird California phenomenon. Earlier this month, Ed Rendell, former mayor of Philadelphia, was easily re-elected governor of Pennsylvania. Another mayor, Martin O'Malley, became governor of Maryland despite a less-than-stellar record in governing crime-ravaged Baltimore.

    There are others on the way. Houston's highly effective Mayor Bill White and Denver's popular "hip and cool" John Hickenlooper are already seen as serious contenders to being elected governor.

    And for the first time in more than four decades, a former mayor, New York's Rudy Giuliani, stands as a serious candidate for president.

Sure many mayors haven’t done much to actually improve their cities. Take San Francisco’s Newsom:

    He's already lost the Olympics and maybe the 49ers as well. He has failed to reverse San Francisco's business-repelling political culture or its reputation for left-wing lunacy. The city's looming long-term fiscal crisis, largely the product of bloated public employee pensions, also has not been dealt with.

    But never mind these boring details. Like O'Malley, Newsom is young. He's handsome. He exudes a hip-and-cool image that commands attention from local media, members of the opposite sex and political elites. If he starts campaigning in Hollywood, meager content and appealing looks can be counted on as a winning combination.

More here.


Posted by tedb at 10:12 AM

November 14, 2006

In San Antonio, Time Warner Customers Don’t Have to Write Congress

It’s 11 days until Thanksgiving and neither Time Warner Cable nor Cablevision Systems, representing some 49 million homes, have signed deals to carry the NFL Network. The Wall Street Journal today has an article about the ticking clock, as the fledgling network, owned by the National Football League, will launch a series of weekly live game broadcasts beginning Turkey Day.

That means unless the NFL and cable companies come to terms, fans in cities like San Antonio, a Time Warner market, or the New York City area, Cablevision territory, won’t get to watch the Denver Broncos battle the Kansas City Chiefs over a second piece of pumpkin pie. Or will they?

Reports the Journal, “Indeed, the league will be counting on those regional fans, those in NFL-less cities as large as Los Angeles and gambling and fantasy aficionados….Much will depend on how angry those fans get, and how much that anger translates into calls to congressional representatives and attorneys general.”

But the author forgets that in San Antonio, thanks to statewide video franchise reform in Texas, NFL fans have a choice. So do customers in Cablevision’s New York City markets, where Verizon competes with its FiOS service (not in every suburban municipality, however, because New York State has yet to take up franchising reform). Quick visits over to AT&T’s U-Verse and Verizon’s FiOS sites confirm that the NFL Network is available as part of lower-end channel packages. So consumers in these markets don’t have to spend time navigating the government’s complaint bureaucracy; they can simply change providers. Ain’t that grand?

In the past, negotiations between programmers and cable companies could go on at length, as was the case when George Steinbrenner moved his New York Yankees to the Yes Network and then sought a higher fee from Cablevision. My gut tells me that the presence of competition, the cable companies will settle a lot faster, maybe not by Thanksgiving, but before the end of the current season. That’s good for consumers everywhere and another example of how competition and franchise reform improves cable service and value.

Posted by steve.titch at 08:35 AM

November 06, 2006

Westchester Candidate Sees Cellular as a Public Utility

It was only a matter of time before it happened, but a candidate for office in the upscale Westchester County, N.Y., community of Lewisboro has called for the creation of a municipal utility to offer residents cellular phone service.

Local conservative columnist J.D. Piro, writing in the local weekly, The Lewisboro Ledger, reported statements by Tom Herzog, the nominal Republican candidate for town supervisor, during a debate last week, and took them to their logical conclusion.

“Saying that cell phone service is now a 'necessity,' Mr. Herzog suggested, in all apparent seriousness, that cell phone service should be a public utility, reasoning that people would then treat cell towers like telephone poles.

”Now there are really only two ways to make cell phone service into a public utility. One is for the government to seize the local assets of the commercial wireless service providers in the area. Perhaps Mr. Herzog, who claims to be a fiscal conservative, can consult with Venezuelan President Hugo Chavez on the cheapest way to do that. The second way is to spend several million dollars developing a local operation to compete with companies that have a national service footprint and 20 years of experience.

”Since Lewisboro is not Venezuela, it’s doubtful the first option will get out of the box. The second option represents a significant budget expenditure, since Lewisboro — a town that can’t even expand its library — would have to build a functional digital cellular system from scratch. Not even the fiscally questionable wireless initiatives being considered by a number of U.S. municipalities attempt to do that.”

It’s a classic example of how even at the lowest levels, governments never shy away from finding more ways to increase size and interference. Herzog’s proposal came as a suggestion as a way to solve a dispute over placement of a cell tower that would greatly improve coverage of the area. The irony, of course, is that tower dispute stems from restrictive zoning laws that regulate where companies can build place towers to begin with.

Herzog also raises all sorts of issues when he equates cell phone towers with telephone poles. Telephone poles can be easily erected on town right-of-way, i.e., alongside public roadways. Cell towers have to be placed more strategically and comprise a lot more than just a stick in the ground. Radio cabinets and controlled environment vaults are usually part of the package--hence the zoning battles in Lewisboro and elsewhere. Is Herzog implying he would declare cell service a utility in order to use eminent domain to force cellular tower placement on private property? He never goes as far to say so, but that’s a real concern whenever a government official uses terms “utility” and “necessity” close together. While the idea is doubtful to ever come to fruition, Lewisboro recent past shows an affinity for regulatory takings, namely in the form of an overreaching wetlands law that allows the town to block modification or development of any piece of property where any standing water is found. .

If I lived there, I’d be a little discomfited.

Posted by steve.titch at 07:59 AM

August 29, 2006

Government Lags Private Sector in Katrina Rebuilding Efforts

As we mark the first anniversary of Hurricane Katrina's devastating landfall today, it is fitting that we look at the progress that has been made in rebuilding the region--and the lack of progress. As Harry Mount explains in a recent article for the UK's Daily Telegraph, there have been stark differences in the rebuilding effort between the public and private sectors:

[W]hile private business has flourished, public works have failed miserably. Schools are only just opening. University departments have been closed for good. Courtrooms don't have enough judges to deal with the renaissance of America's murder capital.

Mount continues:

This mismatch between private and public has nothing to do with shortage of public money; after Katrina, President Bush promised £58 billion ($110 billion) in federal aid for the victims. New Orleans and its crooked ways are partly to blame. Only this weekend, a pair of Bobcat excavators worth £50,000 ($95,000) were stolen from the Lower Ninth Ward, one of the hardest-hit areas of the city, where they were being used to build a memorial to the victims of Katrina.

But the chief culprit is a federal government clogged with bureaucracy and indecision, incapable of spending money even when it's got tons of the stuff.

The American government can just about arrange an orgy in a brothel -- fraudulent applications for Katrina aid were spent on champagne and prostitutes -- but it is hopeless when it comes to large-scale federal construction projects.

This paralyzing bureaucracy is not limited to Katrina recovery efforts, either. As Mount notes, the same maladies have impaired rebuilding efforts at the World Trade Center site as well.

In the five years since September 11, one building, 7 World Trade Centre, the third and least-known skyscraper to collapse that day, is the only one to have been rebuilt.

At 7 WTC, the site's leaseholder, Larry Silverstein, worked unencumbered by the attentions of government. As a result, the £350 million ($665 million), 52-storey tower went up this May without a hitch.

A couple of hundred yards from 7 WTC, Ground Zero is still a great big empty concrete tub.

Mr Silverstein owns the lease to the Ground Zero pit and the rights to rebuild all the space lost within it. But, while 7 World Trade Centre is outside the pit and entirely under his control, construction inside the pit is run by government, principally George Pataki, the outgoing governor of New York State.

We should take these lessons to heart when we consider options for rebuilding of the Gulf Coast, the World Trade Center site, and future disaster areas. It is not government planning, but market forces, that allow for the quickest, most appropriate, and most economical recovery of disaster areas. People and businesses will seek opportunities to invest their resources and offer their services where they are most needed--if only government will get out of the way and let them do it.

Posted by adam at 02:57 PM

August 08, 2006

LA Present Edges Out LA Past

Last week I mentioned a piece I wrote for the LA Business Journal. It’s now reprinted on reason.org:

    If given the choice of living in today's LA or the Los Angeles of a generation ago, which would you choose? I'll stick with today's Southern California.

    For the glass is half-empty crowd, let's start with the common complaints – many of which aren't as bad as they seem at first glance.

    Take gas prices. As much as they hurt, UCLA researchers note that we pump a smaller portion of our incomes into our cars than we did in the 1980s.

    What about LA's smoggy reputation and awful air quality? The California Air Resources Board finds the number of days that LA has exceeded the 1-hour ozone standard has dropped from 192 in 1975 to 75 last year—an impressive 61 percent drop.

    And then there's the crime. Outsiders often regard LA as one giant playground for gangs, but the serious crime rate has been cut in half since 1980.

Whole thing here.

Related: We’re All Supermen Now

Posted by tedb at 11:38 AM

July 18, 2006

Millions for Billionaires—L.A. Edition

Here’s Joel Kotkin:

    AIDED BY MAYOR Antonio Villaraigosa, downtown Los Angeles' boosters are poised to dip again into the pockets of taxpayers to help finance a splashy new project. The cost this time is up to $300 million in loans, tax breaks and fee waivers for a $750-million, 54-story complex — including a 876-room Marriott Marquis, a posh 124-room Ritz-Carlton and 216 luxury condos — across from the Convention Center.

    The Convention Center has been a consistent money loser for years, costing the city $30 million annually in debt service. Even Villaraigosa calls it a "white elephant."

    And this pachyderm has been to the public trough before. In 1988, the city financed a $500-million expansion of the center based on promises that a bigger and more modern facility would catapult L.A. into that elite circle of cities that thrive on the convention business.

Kotkin references a Brookings study, which dismantles the economic case for publicly financed convention centers.

    So if the hotel subsidy doesn't make economic sense, who benefits from the largesse? The biggest winner from the new public investment stands to be billionaire Phil Anschutz, whose $2.5-billion, 27-acre L.A. Live project — billed as "Times Square West" — is slated to be built adjacent to Staples Center. The refracted prestige of a new Ritz Carlton and luxury condos in the neighborhood would add luster to Anschutz's project, the proposed home of the West Coast headquarters of ESPN and a Grammy Award museum.

Whole thing here.

Related: Millions for Billionaires—Minneapolis Edition

Related: Hand-outs for Billionaires


Posted by tedb at 03:22 PM

July 10, 2006

America’s Sweatiest City

It’s not Houston, not Miami either:

    For the third time in five years, Phoenix has been named the sweatiest city in the United States.

    Proctor and Gamble Co. handed out the distinction in their fifth annual sweat survey. El Paso, in 2004, and San Antonio, in 2002, were the other two cities to take home the title.

    According to the study, they estimated how much sweat an average person would produce after walking around for one hour during the summer months.

    With an average temperature of just over 93F last summer, it was concluded that the average person would produce 26 ounces of sweat per hour in Phoenix.

    According to Jay Gooch, a sweat expert with Old Spice, Phoenix residents could combine to produce enough sweat in less than three hours to fill an Olympic sized pool.

If sweat production is what we’re after, then maybe Old Spice’s “sweaty” list should be mixed with Men’s Fitness’s annual “fattest” list. Old Spice measures the sweatiness of an average person (I think 175 lbs is the figure used), but why not use the average weight of folks from Phoenix, El Paso, etc. instead? Don’t bigger bodies produce more sweat?

Based on this approach, which city would be sweatiest? Actually, seems like many of the same cities—El Paso, San Antonio, Phoenix—would be at or near the top of the list. Other cities that score high on fat and (at least from my experience) sweat include Chicago, New Orleans, and New York.

And for those of you who wonder how dry-heat Phoenix could out-sweat a giant sauna like Miami:

    the distinction for the most uncomfortable city to live in did not go Phoenix. Instead, that distinction went to Miami because of the humidity as well as heat.

    Gooch says, "In Phoenix you sweat much more than in Miami, but it evaporates quickly as it is such dry air so you don't notice as much. In Miami the sweat stays on your skin."

Yet Americans don't seem to mind the sweatiness of the South and West that much. After all, the Sun Belt is where the most growth(pdf) is these days.

Sweaty article here.

Fatty article here.

Posted by tedb at 03:01 PM

June 27, 2006

Want to subsidize that stadium? Don’t forget the “hunker-down” and “skedaddle” factors

    A new statewide study co-written by a University of Texas at Arlington economist found that sales tax revenue drops by more than $560,000 every time a city hosts a regular-season NFL game.

    NBA games lower sales tax revenue by $16,000 per game, the study found, while NHL and Major League Baseball games tend to boost average sales tax revenue by small amounts.

    "When it comes to NFL games, that number seems awfully large and negative, but I'm convinced it's there," said UTA's Craig Depken.

    Large traffic jams that accompany Dallas Cowboys and Houston Texans games also lead to what Dr. Depken calls the "hunker-down" and "skedaddle" factors. Fans might spend money in Irving during a Cowboys game, but more residents are likely to avoid gridlock by staying home or driving to a neighboring city to shop or dine.

According to the study, NBA Finals games produce a modest boost in economic activity, but not enough to make up for drain other playoff games bring. Certain pro game seem to generate revenue. The Super Bowl was the biggest winner and political conventions were the biggest losers.

    Critics of the study say it is too focused on sales tax revenue and doesn't take into account many benefits of professional sporting events.

    Linda DiMario, president and CEO of the Arlington Convention & Visitors Bureau, said she's seen plenty of studies like Dr. Depken's in the past. Most have a narrow focus, she said.

    The teams promote civic pride, attract millions of dollars in free publicity and help support adjacent businesses, Ms. DiMario said.

Often adjacent businesses don’t get much in the way of positive impact because fans spend their dollars inside the stadium. But hey, if owners of pro sports teams want to build fancy stadiums with their own dough, then more power to ‘em.

And how about all that civic pride and free pub?

    Football has increased Irving's name recognition, [Maura Gast, executive director of the Irving Convention and Visitors Bureau] said, but all people know is that the Cowboys play there and it's near Dallas. That doesn't necessarily translate into a big boost in tourism.
Article here; UTA study here. (Thanks to Stacey for the tip.)

Len recently pointed to this:

    But while arenas with big-time tenants may bolster a city's self-image and quality of life, evidence shows they have a minimal economic upside. Most operate at a loss.

    In "The Economics of Sports Facilities and Their Communities," published in 2000 in the Journal of Economic Perspectives, authors Andrew Zimbalist of Smith College and John Siegfried of Vanderbilt University argue that "independent work on the economic impact of stadiums and arenas has uniformly found that there is no statistically significant positive correlation between sports facility construction and economic development."

    The authors cite several studies, including one by sports economist Robert Baade that found "no significant difference in personal income growth from 1958 to 1987 between 36 metropolitan areas that hosted a team in one of the four premier professional sports leagues and 12 otherwise comparable areas that did not." The authors' conclusion: Arenas put a drag on the local economy by hurting spending on other activities in the city and boosting municipal costs such as security.

Related: Subsidies and Lies

Related: “large public subsides cannot be justified on economic grounds”

Related: Big Box Boondoggles

Posted by tedb at 04:46 PM

June 20, 2006

WeHo (trying) to Free Weed

    First West Hollywood officials required that pet owners be known as "pet guardians." Then they banned cat declawing and even considered outlawing pet cosmetic surgery.

    On Monday, the Westside town famous for its novel municipal lawmaking took a stab at legalizing the recreational use of small amounts of marijuana.

    But achieving that goal might prove difficult.

    The City Council approved a resolution that urges the Los Angeles County Sheriff's Department to make marijuana-related offenses a "low priority" that deputies should largely ignore.

    In doing so, it became the first city in Southern California to request that its law enforcement agency look the other way at recreational pot use and target only the sale of marijuana.

    ...

    San Francisco and Oakland have passed similar rules. But unlike those cities, West Hollywood lacks its own police force. Instead it contracts with the county sheriff for police services.

LAT article here; thanks to Courtney for the tip.

WeHo has no authority to force the county department to comply with its vote and Sheriff Baca isn’t going to side with the City Council.

But is it better to spend more than 10 grand per weed arrest?

When cops focus too much on marijuana-related arrests, their priorities get hazy:

    In Florida, our research reveals that the War on Drugs was fought at the expense of property crime as police efforts shifted to drugs. This means that the chances of being arrested for a property crime falls, and burglars can commit more crimes before they are apprehended. We estimate there was a 10 percent increase in property crimes due to reallocating police effort from property crime to drug offenses in Florida between 1984 and 1989. Drug policy expert Mark Kleiman confirms this view: “much of the increase in local drug enforcement during the 1980s came at the expense of other law enforcement efforts... As a result, certain kinds of property crimes are treated as unworthy of investigation or prosecution.”

And how about those unintended consequences:

    A 1994 National Bureau of Economic Research study found that youth tend to drink more beer when the price of marijuana rises, with the result being more traffic fatalities. Beer drinkers are either more likely to drink and drive or they are more dangerous drivers than those in a pot stupor. Research shows that alcohol impaired drivers are more aggressive than those under the influence of cannabis.

Such trade-offfs are especially in significant in bar/club-rich West Hollywood.

More from Bruce Benson and David Rasmussen here.

Posted by tedb at 07:55 PM

March 29, 2006

San Fran Studies Congestion Charge

    [T]he San Francisco County Transportation Authority soon will receive $1.04 million from the Federal Highway Administration -- and add $260,000 in local funding -- to study how to implement a program similar to London's 3-year-old system of charging a flat fee to drive downtown during business hours.

    That's $1.3 million to figure out how to collect millions from drivers willing to pay the freight to give a financial boost to public transit systems and perhaps curb traffic congestion.

    And that's how, not if.

Article here.

Related: Privatization Watch cover story: Coming to America? A Cautionary View on Importing London-Style Congestion Pricing

Posted by tedb at 09:30 AM

March 22, 2006

Major League Boondoggles

An interesting article in Sunday's Boston Globe explored the thinking behind the massive taxpayer subsidization of major league sports teams and stadiums, despite an abundance of evidence that such efforts fail to create jobs or spur economic growth:

For a decade and a half, the belief that sports teams were economic drivers helped persuade cities and states to shower billions of dollars on major league sports teams, most of it to build state-of-the-art stadiums like the Detroit Tigers' Comerica Park, the Seattle Seahawks' Qwest Field, and perhaps most famously the Baltimore Orioles' Camden Yards-the 1992 ballpark that set the standard not only for how ballparks would look, but how they would be built and paid for. "Build the Stadium," went a 1997 slogan for a new San Francisco football stadium, "Create the Jobs!"

But Menino isn't the only one to have had second thoughts in recent years about the wisdom of such largesse. Bitter public disputes have broken out in a few other sports cities over whether to give public funds to the local team. The most recent ballpark to be built, St. Louis's new Busch Stadium, was paid for almost entirely by the Cardinals after city and state officials refused to commit public funds. A proposed Manhattan stadium for the New York Jets died last year when the state government refused to chip in the asked-for $300 million. The political battle over the funding of Miller Park, in Milwaukee, was so vitriolic that former Wisconsin governor Tommy Thompson refused to set foot in it for years after it was built.

This new skepticism of public sports team funding is thanks in part to a small community of economists who have taken up and methodically rejected many of the claims made about the economic benefits of major league sports teams: that they create jobs or bring money to local businesses or otherwise spur economic growth. "Generally speaking," says Andrew Zimbalist, a professor at Smith College and a leading sports economist, "the independent research suggests that we can't anticipate any economic impact" from sports teams and stadiums.

. . . .

As for new jobs, sports teams and their stadiums do create them, but remarkably inefficiently, according to Roger Noll, an economics professor at Stanford University and co-editor, with Zimbalist, of "Sports, Jobs, and Taxes" (1997), one of the most comprehensive works on the public funding of sports. In Baltimore, he says, the cost per job created by Camden Yards was $125,000, whereas for the city's other urban redevelopment programs it was $6,000 per job. And $125,000, according to Noll, is actually pretty efficient for a sports stadium.

University of Chicago economist Allen Sanderson puts it another way. "Cities would be better off," he says, "if the mayor were to go up in a helicopter and dump out $100,000."

According to the article, there are several reasons that cities still fork over gargantuan sums for stadia, despite the paucity of economic justification for them:

  • Monpolistic major league sports organizations limit the supply of teams, driving up the "price" cities are willing to pay to have them (e.g., subsidies, land deals, stadium lease deals);
  • Politicians see major league sports teams and shiny new stadia as status symbols worthy of public funding;
  • Though they're financial losers, stadiums can serve as catalysts for urban redevelopment and revitalization; and
  • Many people simply like sports and value them in a way that transcends traditional cost/benefit analyses.

It's great to see the Globe take on this topic, as taxpayers in numerous cities have been sold a bill of goods over the last two decades. For more on the folly of taxpayer-subsidized stadiums in specific cities, check out Sam's op-ed on Indianapolis' proposed football stadium and convention center expansion, as well as Adam's op-ed and Jacob's article on D.C.'s baseball stadium.

Posted by lengilroy at 09:39 AM

March 10, 2006

“Smoking is prohibited everywhere in the city”

    Because it's getting hard to keep track of all the places where you're not allowed to smoke, the city council of Calabasas, California, decided to start over from scratch and make things simple. "Smoking is prohibited everywhere in the city," says a Calabasas ordinance that takes effect on March 17, "except as otherwise provided."

    The exceptions are private residences, up to 20 percent of hotel rooms, "smokers' outposts" in shopping center parking lots, and "any outdoor area in which no non-smoker is present and...it is not reasonable to expect another person to arrive." The smoke-free areas, a.k.a. "everywhere else," include sidewalks, streets, bus stops, parks, the outdoor seating of bars and restaurants, and apartment balconies near common areas such as pools or laundry rooms.

Read Jacob Sullum’s column here.

Update: City Has No Plans to Jail Smokers—Yet

Related: Cigarrette Sales Hit 55 Year Low

Related: Smoking Bans Reach Another Disturbing Milestone

Related: No Smoking in NYC Bars and Outdoor Smoking Bans in San Francisco

Related: Good News—No Wait, Scratch That


Posted by tedb at 12:28 PM

March 03, 2006

What Price Free WiFi?

The news that Wireless Philadelphia has finalized terms with EarthLink pre-empted this post yesterday, but I made an oblique reference to its source when I tossed out a comment about the buzz Philadelphia was getting as a model for municipal wireless.

Craig Settles, who dissects the process of the Wireless Philadelphia project in Fighting the Good Fight for Municipal Wireless, is one of the few municipal wireless consultants who is willing to talk about the hard facts of the task at hand. In a new paper, “What’s the Price of Free?” he has published the replies to a list of questions he sent to various analysts and municipal IT officers about the challenges of municipal WiFi, particularly free WiFi. It makes interesting reading for anyone following the municipal wireless trend.

The 13 respondents include Ben Gibson, director of wireless and mobility networking at Cisco Systems; Chuck Haas, CEO and Co-Founder of MetroFi; Kim Crossman, a municipal wireless activist with San Francisco’s Webnetic; Cindy Mullen, CIO of St. Paul, Minn.; and Berge Ayvazian, executive vice president of wireless mobile technologies at the Yankee Group.

The 33-page document amounts to a virtual roundtable on the experience municipalities have had with wireless to date. While difficult to boil down to a sound bite, most participants agree that cities begin these projects with unrealistically high expectations, basically about cost of the technology and the willingness of vendors and service provider partners to provide equipment and services for free or at extreme discounts.

In short, there is no such thing as free WiFi, and while municipalities can expect a high level of cooperation from vendors and partners, they need to be acutely aware that their interests don’t always coincide. Those cities that fail to grasp this are the one’s most likely to either fail, or on the other hand, be grossly taken advantage of by an aggressive corporate partner. The worst case scenario is likely to occur in cities that attempts to mount municipal wireless purely for a political payoff, such is the case in San Francisco.

In summarizing his findings, Settles cautions municipalities with the following observations:

* Put too much emphasis on free during the vendor search, you’ll scare away what might be your best options for a quality network;

* All this talk about free can raise expectations among citizens that can’t be met;

* “It’s free, what do they have to complain about” is a perception that will lead to needless headaches, rude awakenings and a possible regime change at City Hall;

* Overemphasis on free can lead to inferior networks, inadequate maintenance and technology obsolescence;

* A hands-off approach to vendor relationships leads to hands-on aggravation when stuff hits the fan;

* Don’t pay attention to the financial well-being of your vendors, bad things can happen;

* “Free now, pay later” brings out the worst in some politicians.



Settles and his survey participants conclude that in order to be successful, a city has got to approach wireless as if it were a business—that it be able to perform due diligence on partners, challenge vendors on technology claims and evaluate service partner marketing plans. They also need to be able to articulate their interests and realistically assess their partners' ability to meet them.

Now if governments truly operated like businesses, I wouldn’t be a libertarian. The trouble is governments, by nature, do not. Nor are they designed to. If this is what’s needed to run a successful municipal wireless operation, it’s no surprise so many have failed. “What’s right with a little common business sense?” Settles asks of cities. He already asks too much. Cities don’t have any business sense. Just read any one of the blog entries here.

In fact, in some of the very places that Settles’ group praise, like Minneapolis, the pushback has been that the government is behaving too much like the incumbents it seeks to challenge.

So after reading the responses in Settles’ paper, I come away with the question: if municipal wireless is so hard to mount, and requires cities to master skill sets they do not inherently have, why should they do it at all? Why not just leave it to the pros with the skills and the business sense?

The more I read about the way the municipal sector is handling its pursuit of wireless, the more I have my doubts whether any of them will be truly get what they are being promised. Philadelphia is the exception. San Francisco is the rule. In the end, there are going be many more failures, disappointments and political recriminations for the few success that emerge.

Posted by steve.titch at 12:46 PM

February 27, 2006

Regulation for Revenue

This book review from 1994 holds up well in our post-Kelo world:

    The disputes about growth involve the issues of property rights, taxation, and government planning for public works such as transportation and water. But the growth issue opens a window on some of the larger and more ominous ailments of modern political economy, the nature of which is hinted at in the main title of Alan Altschuler and Jose Gómez-Ibáñez's recent study, Regulation for Revenue: The Political Economy of Land Use Exactions.

    The phrase "regulation for revenue" refers to the recent but now widespread practice of imposing large "impact" fees, special assessments, and exactions on new residential and commercial real-estate development. Only about 10 percent of American localities imposed exactions before 1960, the authors note, while by the mid-'80s about 90 percent did. Regulation for Revenue is the most thorough survey to date of the surprisingly limited amount of economic literature that has been produced on this subject. And although the authors do not set out to be partisans on one side or another, they clearly recognize that crafting regulatory systems explicitly to produce revenue, as opposed to a traditional "compelling state interest" such as health and safety, represents "a dramatic power shift...from the owners of property to government officials."

    The other notable feature of this book is its recognition that "relevant market signals are almost entirely absent" from most aspects of urban planning today. The discussion of the virtue of road pricing and other market-based policies shows how ideas once confined to the pages of REASON have become part of the mainstream discussion.
    The use of impact fees and exactions--as high as $40,000 for a single family home and $30 per square foot for commercial development in California--soared in the '80s, ostensibly as a way to get around anti-tax sentiment and voter-imposed tax limits such as California's Proposition 13 or Massachusetts's Proposition 21/2.

    For goo-goo ("good government") types, impact fees have the obvious attraction of being even more thoroughly hidden than their first cousin, the value-added tax. "They do not show up on anyone's tax bill," Altshuler and Gómez-Ibáñez write, "and while they are likely to drive up developer prices they remain imperceptible even to purchasers as a distinct cost item." Together with the enhanced regulatory regime to which impact fees are ineluctably linked, this new way of governing development has led to huge new opportunities at the local government level for socialist-minded reformers and has contributed to the bureaucratization of local government across the country.

Whole thing here.


Fore more examples of government greed, go here, here and here.

Posted by tedb at 01:22 PM

February 23, 2006

More Dominoes Fall

Another north Fulton County community has taken the first step toward cityhood. On Wednesday, the state House approved the measure for John’s Creek - the second new community to reach this step since Sandy Springs was incorporated in December...while privatizing most of their services too!

What's more interesting though is that a bill in the state Senate could also create two additional new cities in south Fulton calling for the creation of two cities south of Atlanta. One would be Chattahoochee Hill Country, the other, South Fulton City. That would be four new cities - while they all might not follow the Sandy Springs model of governance, it is an interesting dynamic that is forming in the Atlanta metro area....

Oh, but wait, its moved beyond Georgia into Orlando, Florida (ok, not exactly the same conditions and they're probably not related) but a movement to create East Orlando is afoot.

Posted by geoffs at 07:51 PM

February 21, 2006

Pension Reform and Managed Competition in San Diego (& Houston?)

Otis White comments on San Diego mayor Jerry Sanders' plan for the city, which includes pension reform and managed competition:

First, about the pension fund: Sanders wants to stomp on the benefits brake by limiting the pensions of new hires and making it much, much harder to award additional benefits to existing workers. He hasn’t announced yet what kind of pension system he’d like for new employees — that will be the subject of union negotiations this year — but it must be “affordable,” he says. To restrain city hall from handing out new benefits in the future, he’s pushing for a charter amendment requiring a referendum before any increases could take effect.

Now, about the management changes: Sanders wants to bring “managed competition” to San Diego. What’s that? It’s the management system Stephen Goldsmith pioneered when he was mayor of Indianapolis in the 1990s. (Goldsmith wrote about his experiences in a book titled “The Twenty-First Century City: Resurrecting Urban America.” You can find an outline of his ideas, from a 2001 New York Times op-ed piece, by clicking here.

As mayor, Goldsmith championed two ideas, privatization and competition. Privatization alone didn’t work, Goldsmith wrote, because private monopolies weren’t that much more efficient than public ones. So simply turning the water department over to a private company wouldn’t accomplish much. But if you could carve up the city into zones and let a number of providers (including city workers themselves) compete to haul garbage, tow abandoned cars, fix potholes and so on, wonderful and surprising things happened, Goldsmith found. Services improved, work processes were streamlined, productivity soared and costs declined dramatically.

Amazingly, city workers often turned out to be the high-quality, low-cost providers, once they were allowed to compete. “The problem,” Goldsmith wrote in his book, “is that [municipal employees] have been trapped in a system that punishes initiative, ignores efficiency and rewards big spenders.” A system ... well, like San Diego city government.

The full article is here (scroll to the bottom of the page). For more on these topics, check out Reason's study on pensions, as well as our How-to-Guide on managed competition.

And Houston blogger (and friend) Tory Gattis thinks managed competition would be great for Houston:

The internationally-read Economist magazine recently noted that unions are getting traction in Houston. They also seem to be making inroads in city government. While I sympathize with people's desires to increase their compensation and benefits, doing it through monopoly power seems like a bad idea (I've never understood why it's bad for a company (i.e. "capital") to abuse monopoly power to increase profits but good for labor to do the same thing). It distorts what should be a simple supply-and-demand market of jobs and labor: the organization offers a job at a market pay rate, and you can choose to take it or look elsewhere.

. . . .

...[Managed competition] seems like a great way to accomplish two objectives at once: better and cheaper city services in a structure that is far less fertile for unionization. I know Mayor White is a Democrat - which tends to be a pro-union party - but he has to realize this system would be far healthier for Houston in the long-run. How about giving it a try?

I fully agree with Tory here, and I think that it would dovetail nicely with Mayor White's goal of continuing to improve the efficiency and responsiveness of city government.

(hat tip: Tory Gattis/Houston Strategies)

Posted by lengilroy at 05:39 AM

February 14, 2006

Areas Follow in Sandy Springs Footsteps

The author of a Georgia bill that will create a new city in the same vein as Sandy Springs explains himself.

Posted by geoffs at 06:20 AM

February 10, 2006

The Dogma of Municipal WiFi

When free-market libertarians and big-government liberals gang up on you, you might as well give it up.

If you think that the $353 million dollar public tax giveaway for the proposed Twins stadium is a sweet deal for billionaire Carl Pohlad—the richest owner in major league baseball—and a raw deal for the public, then you will cringe at what is poised to be an even more blatant act of corporate welfare: Minneapolis’ plan to outsource a citywide wireless (Wi-Fi) broadband network project that will provide internet access everywhere in the city.

This is not from an article in Reason. Quite the contrary, it’s the lead that kicks off a 2,000-word screed that serves as the cover story, "The Selling out of Public WiFi," in the current issue of Pulse the Twin Cities, a left-leaning alternative weekly in Minneapolis-St. Paul.

Fresh from having to defend the Minneapolis WiFi plan against a St. Paul Pioneer Press editorial that questioned why the city government should be meddling in a functional market, Minneapolis Mayor R.T. Ryback now must fend off attacks from the Left.

Ryback countered Pioneer Press criticism by stating the Minneapolis plan is a public-private partnership. No taxpayer money will fund it. The $25 million project will be managed by either EarthLink or U.S. Internet, the two finalists.

That’s precisely the problem, writes Aaron Neumann in Pulse, who’d rather see the City of Minneapolis shoulder the whole project itself, even though he freely admits in the article that, under the current plan, the city won’t have to battle bigger, stronger commercial Internet players, and, besides, has nowhere near $25 million lying around to fund such a venture.

But when you’re a muni loonie, practicalities don’t matter. We’ve already seen big-government liberals gang up on the San Francisco municipal wireless plan, which also seeks to outsource construction, management and ownership. It’s a growing trend. Municipal governments have considered the independent studies of the cost of ownership, like JupiterResearch’s finding that WiFi costs $150,000 per square mile over five years, the security liabilities inherent in wireless data networks and the competitive picture, and have wisely punted.

That’s what appalls the Left the most: they are losing another opportunity to increase the size and intrusiveness of government. For all they talk about bridging the digital divide, increasing broadband penetration and making cities “hip,” for the true believers such as Neumann, if the government isn’t doing broadband, they’d rather not see it done at all.

As with all forms of dogma, irony is lost. The reasons Neumann lists to fight the project – that it amounts to corporate welfare, that its finances won’t be transparent, that there will be no accountability for quality service, aren’t reasons to increase government involvement. They are reasons why governments should not be involved at all. I don’t think these "public-private" muni wireless franchises are a great idea, either, but they are far better than creating another city bureaucracy. In the end, I hope that most cities realize these broadband networks will expand without (or despite) cozy city arrangements.

I’ve spent time with state and local legislators, and even officials from muni wireless consultants such as Civitium. While we disagree on the fundamental principles behind municipal wireless and broadband, there is no question that their motives are driven by a desire to expand cheap, reliable Internet access. Still, as cities study the empirical costs of these ventures, most are wisely backing away from direct government ownership.

This has forced the muni loonies to raise the volume and, in the process, reveal their real agenda – and it has nothing to do with broadband. At heart, like much of the environmental movement, the “nutrition” police, and the anti-Wal-Mart “low-prices-hurt-the-poor” crowd, muni broadband activists are driven by an emotional, dogmatic antipathy for business. But such radical rhetoric doesn’t play well in City Hall. Dare we mention that Philadelphia, San Francisco, Portland, Ore., which along with Minneapolis, have outsourced “municipal” wireless, all have Democratic administrations. You can’t blame pro-business conservatives and libertarians for this one.

Posted by steve.titch at 10:49 AM

February 06, 2006

Recycled Recycling Myths in Seattle

Did you know that it's now illegal in Seattle to not recycle? There was a great piece by James Thayer in the Weekly Standard recently highlighting the absurdity of this latest effort to promote recycling:

    On January 1, placing more than 10 percent recyclable materials into a garbage bin became illegal in Seattle. An offending bin is tagged with a bright yellow slip that announces, "Recycle. It's not garbage anymore." The un-emptied bin is then left at the curb in hopes that the homeowner will learn the lesson and remove the reusable material by next week's collection. Businesses that offend three times are fined $50.

    . . . .

    Echoing widespread Seattle sentiment (85 percent of the city's citizens approve of curbside recycling), the Seattle Times editorial board has concluded that "Recycling is a good thing." After all, using a bottle twice must be better than using it once, saving resources and sparing the landfill.

    The truth, though, is that recycling is an expense, not a savings, for a city. "Every community recycling program in America today costs more than the revenue it generates," says Dr. Jay Lehr of the Heartland Institute.

Thayer's piece is well worth a read and debunks some prevalent recycling myths. Among them:

  • Aren't we running out of landfill space? No.
      Clemson Professor Daniel K. Benjamin notes that rather than running out of space, overall capacity is growing. "In fact," he says, "the United States today has more landfill capacity than ever before." He adds that the total land area required to contain every scrap of this country's garbage for the next 100 years would be only 10 miles square. The Nevada Policy Research Institute's numbers are even more dramatic: an area 44 miles square and 120 feet deep would handle all of America's garbage for the next millennium.
  • Aren't landfills a public health hazard? No.
      America's image of landfills was fixed decades ago, and is that of Staten Island's Fresh Kills, a vast swampy expanse of detritus, with huge Caterpillar tractors trundling over it, and clouds of seagulls obscuring everything above ground. Fresh Kills received New York's garbage for 53 years before it was closed in 2001. Modern landfills have nothing in common with the place. Benjamin says that new landfills are located far from groundwater supplies, and are built on thick clay beds that are covered with plastic liners, on top of which goes another layer of sand or gravel. Pipes remove leachate, which is then treated at wastewater plants. Escaping gas is burned or sold. A park or golf course or industrial development eventually goes over the landfill.

      Fresh Kills also looked dangerous, a veritable soup of deadly poisons and nasty chemicals, seeping and dissolving and dispersing. But that's not the case with new landfills. Daniel Benjamin writes, "According to the EPA's own estimates, modern landfills can be expected to cause 5.7 cancer-related deaths over the next 300 years--just one death every 50 years. To put this in perspective, cancer kills over 560,000 people every year in the United States."

  • Aren't we saving natural resources by recycling? Hardly.
      Almost 90 percent of this country's paper comes from renewable forests, and to say we will someday run out of trees is the same as saying we will some day run out of corn. According to [Cato's] Jerry Taylor, we are growing 22 million acres of new forest each year, and we harvest 15 million acres, for a net annual gain of 7 million acres. The United States has almost four times more forested land today than it did 80 years ago.

      Are we running out of that other staple of recycle bins, glass? All those wine and beer bottles are manufactured from silica dioxide, the fancy term for sand, which Jay Lehr points out is the most abundant mineral in the earth's crust.

      Nor will we ever suffer a shortage of plastic, which is made from petroleum byproducts. Today more petroleum reserves are being discovered than are being used up. And plastics can now also be synthesized from farm products. Lehr concludes, "We are not running out of, nor will we ever run out of, any of the resources we recycle."


Be sure to check out Reason's recycling research for more info on the subject.

Posted by lengilroy at 10:22 AM

January 24, 2006

Follow the Leader: Sandy Springs

Its official - legislation has been introduced in Georgia to create two new cities on the heels of the success of Sandy Springs

Posted by geoffs at 06:37 AM

January 20, 2006

Houston City Council Drops Municipal League Membership

The Houston City Council deserves a nod for taking a stand for taxpayers yesterday:

    In what could be the first of future trends, shock waves were sent yesterday when the Houston City Council failed to pass a resolution renewing its membership in the Texas Municipal League, a lobbying group that has fought property tax appraisal caps.

    At issue was whether to pay $68,000 in dues to the Texas Municipal League, which represents the collective concerns of cities such as Houston before the Legislature & Congress.

    “This week, the Texas Municipal League was sent a strong message -- don't mess with Texas taxpayers,” said Americans for Prosperity-Texas director Peggy Venable.

    . . . .

    The Houston City Council was prepared to deny Mayor White's request to spend almost $70,000 to pay dues to the organization. Once the probable outcome became clear during debate, the Mayor decided to not ask for a vote, instead saying he would use private money to pay the city's TML membership dues.

    . . . .

    The Texas Municipal League has actively lobbied against the capping of property appraisals and worked against taxpayer protection legislation, similar to a "Taxpayer Bill of Rights" sponsored by Rep Carl Isett (R-Lubbock) during the last Texas legislative session.

    . . . .

    Last year, Houston voters approved a city "Taxpayer Bill of Rights" to limit city spending to population increases and inflation, with taxpayer approval required for spending above that cap. Mayor Bill White worked to thwart the will of Houston voters by challenging that vote in the courts, using tax dollars to fight against the voters.

Read the full article here. And check out this related post from last week.

Posted by lengilroy at 10:19 AM

January 11, 2006

District Court Sides With Houston's TABOR

Some great news today on Houston's Proposition 2, a local tax and expenditure limitation modeled after Colorado's Taxpayer Bill of Rights (TABOR):

    In a defeat for Mayor Bill White's administration, a district court has ruled that the city of Houston must operate under two revenue-cap initiatives approved by voters in 2004.

    The city had argued that a limited cap backed by the mayor, called Proposition 1, took precedence because it received more votes. Backers of Proposition 2, put on the ballot by resident petition, said the city had to put both caps into effect, and sought a court order.

    In a summary judgment issued late Monday, state District Judge Tad Halbach agreed with the Proposition 2 plaintiffs.

    The city will appeal the ruling, which the mayor and controller say has no immediate practical effect on city revenues since this year's budget was written to allow for both revenue caps.

    . . . .

    Under Proposition 1, the city caps annual increases in property tax revenue and water and sewer rates to the combined rates of population growth and inflation. Proposition 2 would limit annual revenue increases from all sources — including aviation and convention money — to the combined rates of population growth and inflation.

    . . . .

    Bruce Hotze, a plaintiff in the case, said he was pleased by the ruling.

    "I'm extremely disappointed that the mayor continues to fight the will of the voters at the ballot box," he said.

    Harris County Tax Assessor-Collector Paul Bettencourt said he hopes the city does not appeal the decision.

    "All you are doing is throwing taxpayer dollars away. A summary judgment is a pretty strong statement," he said.

For background, Prop 2 is designed to reduce the cost of city government each year by limiting the growth of city revenue to the combined rates of inflation and population growth. If the city exceeds this limit, the excess revenue must be refunded to the taxpayers or be subjected to voter approval before the city could spend it. It covers all city revenues collected in a fiscal year, including property taxes, sales taxes, water and sewer fees, airport revenues, and pollution fines.

For more background on Prop 2 from the initiative's backers, see here.

Posted by lengilroy at 06:53 PM

December 09, 2005

Look who’s slimming down

    "It makes some of the Republican administrations across the country look bad, if the bastion of liberalness is taking the lead on this," [David Williams of Citizens Against Government Waste] said with a laugh.

San Francisco’s hipster Mayor, Gavin Newson, is taking aim at city spending. He’s targeting things like cars, cell phones and copiers:

    [C]opying costs alone more than doubled from 2001 to 2002 from $7.4 million to $15.1 million.

    Under the Newsom administration, San Francisco has trimmed its car fleet by 370 vehicles saving taxpayers $2.2 million, while cell phone use is $1.9 million under budget and copier- and print-related expenditures are down $1.8 million over last year, according to the Department of Administrative Services.

Article here; via the mayor’s own blog.

Posted by tedb at 11:02 AM

September 29, 2005

The important business of governance

Marty Markowitz is really into erecting big, Brookyn-touting signs. His latest--“Leaving Brooklyn? Oy vey!”--can be seen by motorists who leave Brooklyn via the Williamsburg Bridge:

    The huge sign, affixed to a cross beam of the bridge high above the bustling traffic, is a sweet victory for Marty Markowitz, president of the borough, home to a large Jewish population.

    When Markowitz first approached the Department of Transportation about the sign in January 2004, he was rebuffed because the agency felt it would be distracting to motorists.

    After "revisiting" the issue, the DOT allowed the sign to go up two weeks ago, Markowitz said Wednesday. "I'm thrilled."

    Markowitz said he is responsible for many other signs …

Such as:

    "Not Just A Borough, An Experience"; "Name It...We Got It"; "Like No Other Place in the World"; "Believe the Hype."

By the way, Markowitz is running for reelection.

Article here.


Posted by tedb at 07:25 PM

September 15, 2005

Sandy Springs Selects Contractor

As reported here before, Sandy Springs selected a contractor to manage the city's administrative functions and run the hands-on parts of the government.

Following a unanimous vote Wednesday by the commission, CH2M Hill-OMI immediately will begin working out details on how to operate the newly created city of almost 90,000. But it will do so without a contract, which could be approved Dec. 1 at the earliest. That's when the community of Sandy Springs officially becomes the city of Sandy Springs.

The proposed contract is worth $32 million - nearly half what the city was expecting to spend! Oliver Porter, the chairman of the commission said: "That's more service for less cost than anything we could've hoped for."

Posted by geoffs at 03:08 PM

September 01, 2005

Why didn’t they leave?

Tyler Cowen mulls over some possible explanations here.

Posted by tedb at 01:06 PM

Wall Street Journal readers

Check out Joel Kotkin’s piece on New Orleans.

Posted by tedb at 12:40 PM

July 12, 2005

NAACP wants slavery tests for contractors

    The NAACP will target private companies as part of its economic agenda, seeking reparations from corporations with historical ties to slavery and boycotting companies that refuse to participate in its annual business diversity report card …

    The group's strategy will include a lobbying effort to encourage cities to enact laws requiring businesses to complete an extensive slavery study and submit it to the city before they can get a city contract.

    Such laws exist in Philadelphia and Chicago, which can refuse to grant contracts because of a company's slavery ties although neither city has done this. Detroit and New Orleans are considering similar bills.

Whole article is here.

(Via Sploid.)

Posted by tedb at 10:43 AM

June 15, 2005

Is getting wired no longer enough?

Related to the previous post by Adrian, is Intel's list of the most “unwired” cities in America:

    Seattle is now the most unwired city in America, according to Intel Corporation's third annual "Most Unwired Cities" survey …

    This year's survey sheds more light on what previous Intel Unwired Cities surveys were indicating - that connecting to wireless Internet access points with laptop PCs and other wireless-enabled devices in public places is becoming part of everyday life in America …

    Following the Seattle-Bellevue-Everett-Tacoma, Wash. area on the list of top 10 unwired regions are San Francisco-San Jose-Oakland, Calif. (No. 2); Austin, Texas (No. 3); Portland, Ore.-Vancouver, Wash. (No. 4); Toledo, Ohio (No. 5); Atlanta (No. 6); Denver (N o. 7); Raleigh-Durham, N.C. (No. 8); Minneapolis-St. Paul, Minn. (No. 9) and Orange County, Calif. (No.10).

Here’s the press release and here’s the complete list.

I bet plenty of local leaders are already waving this list around, going on and on about how important it is to move up it. Meanwhile their schools are probably awful, traffic congestion is probably mounting, infrastructure is probably crumbling, etc …

Posted by tedb at 05:34 PM

May 26, 2005

Government won’t get out of the john

New York’s City Council just passed a new bill:

    New buildings and buildings undergoing major renovations will be required to install two toilets for women for every one provided to men.

    The current law, enacted in 1984, requires a 1-to-1 ratio. But men can "zoom in and zoom out," while women end up waiting in long lines, noted Councilwoman Madeline Provenzano (D-Bronx), chairwoman of the Housing and Buildings Committee.

    "This is a quantum leap into the 21st century," said Councilwoman Yvette Clarke (D-Brooklyn), chief sponsor and architect of the bill.

    The bill approved yesterday is a compromise version of a proposal that would have required virtually all buildings - new and old - with public rest rooms to have two facilities for women for every one designated for men.

    In a deal with Mayor Bloomberg, the original potty-parity bill was flushed because of complaints over its potentially huge cost to owners of bars, restaurants and theaters and to publicly owned facilities, such as stadiums.

    The bill approved yesterday, 50-to-0 with one absentee, mandates the 2-for-1 rule only for new buildings and existing ones that undergo renovations whose costs exceed 50% of the value of the building. The law could take effect as soon as the fall.

Sigh.

(Via Sploid.)

Posted by tedb at 05:15 PM

May 19, 2005

"Whatever" wins in landslide

Antonio Villaraigosa will be L.A.?s next mayor, but what?s with all this landslide talk?

Peter Gordon explains:

    The LA Times reports that of the City's 3.8 million, only 1.4 million are registered to vote. Of these, the winner received 18.6% while the incumbent came in with 13.1%. More than 68% of those registered stayed away. All of this in a City where approximately 1.9 million are eligible to vote (over 18 and citizens). The proportions, then, were more like 13.7 % for the winner, 9.7% for the loser and 75% for "whatever".

And Joel Kotkin worries about the rise of ?cool? mayors:

    Villaraigosa represents the latest trend in big-city mayors: the cool chief executive. The world is now filled with such characters, usually handsome and telegenic, who often seem more like celebrity endorsers for their cities than tough-minded chief executives ?

    Detroit's Kwame Kilpatrick, for instance, was elected in part because he sold himself as "the hip-hop mayor" who would turn the Motor City into the next "cool city." Kilpatrick's recent missteps ? such as having family members use a luxury SUV leased at public expense ? have somewhat tarnished his appeal. The city's continuing descent into the later stages of municipal collapse has not helped. But other "cool" mayors are still getting good reviews, from the media and, in many places, from voters as well. Indeed, several of these ? Denver's John Hickenlooper, Baltimore's Martin O'Malley and San Francisco's Gavin Newsom ? were recently among Time magazine's top U.S. mayors ?

    [N]either O'Malley nor Newsom has been able so far to rescue his city from continuing economic decline. O'Malley's strategy in crime infested Baltimore ? based on attracting gays and bohemians ? strikes some as slightly superficial. What's the point of being hip and cool if you're being mugged?

Where have all the crusty pothole-filling mayors gone?

Posted by tedb at 10:32 AM

April 18, 2005

Scoring the mayors

Here’s Time’s list of the best and worst big city mayors.

Staffers apparently put their heads together with a bunch of “urban experts” to come up with the list. (Chicago's Daley is on top).

Here’s their approach:

    It is tempting to judge our mayors for the little things that make city life livable, the depth of the potholes, the smell of the streets, whether or not the traffic lights are in synch. But the best mayors have also been those who act on a grand scale, building bridges, saving schools, finding the funds that cities forever lack.

Funds that cities forever lack? Hmmm. Are cities forever lacking funds or forever mismanaging them?

And acting on a "grand scale" makes me nervous. The mag points to Denver’s John Hickenlooper (who should win an award for his name alone) as someone who did just that:

    And in his biggest score, he won approval for a $4.7 billion mass-transit plan, which involved persuading voters, along with about a dozen mayors in seven regional counties, to back a sales-tax hike.

What if he had proposed a less grand plan that did a better job of improving transportation? Would Time magazine still ooh and ahh over him?

Anyhow, let’s just get to what people really care about.

Here are Time’s worst mayors: Dick Murphy, Kwame Kilpatrick, and John Street.

Posted by tedb at 09:50 AM

April 09, 2005

Variable Rate Pricing Boosts Waste Diversion Rates

...according to this paper by UC Berkeley law professor Peter S. Menell. Here's the abstract:

    In the late 1980s and early 1990s, it was widely reported that the United States faced a solid waste crisis. Existing landfills were reaching capacity or being shut down because of more stringent regulations while waste volumes were continuing to rise. At the time, several market-oriented policy analysts advocated the adoption of variable rate charges for mixed refuse in conjunction with curbside pick-up of recyclables (without charge) as a means of reducing waste volumes and diverting recyclable material to more valuable uses. During the course of the past decade, such policies have been adopted widely throughout the United States - approximately 20 percent of the U.S. population now face variable rate charges for mixed refuse collection. Even more have curbside collection of recyclable materials. This article collects and reviews empirical studies evaluating the effects of variable rate pricing. It finds that these policies have been quite effective as a means of boosting diversion rates beyond the levels that can be achieved through curbside collection of recyclables alone. The overall cost-benefit analysis of such programs is modestly favorable. Since many states and communities have committed to achieving specified waste diversion targets, variable rate policies have been a cost effective policy tool. The experience with variable rate policies represents a promising example of non-coercive, information-oriented government intervention. With a relatively small budget and no authority to impose household solid waste policy on local governments, EPA has been remarkably successful at developing and diffusing effective solid waste management policies. The economic theory underlying variable rate pricing has proven, after some tinkering at the implementation stage, to be quite workable in practice. In fact, the practical realities of implementing charges have shown that theoretical perfection in terms of getting the prices right is less important in the grand scheme than keeping the transaction costs manageable. Looking forward, variable rate pricing can be expected to become even more economically advantageous as recycling markets continue to mature, landfill tipping fees rise, and improved technologies for curbside collection, monitoring, billing, and measuring waste develop.

Posted by lengilroy at 02:51 PM

April 04, 2005

Big Bellwood is Watching You

From the "Orwell must be spinning in his grave" department:

    In the hopes of eliminating crime, [Bellwood, IL] officials say they'll have all the public ways in the 3.5-square mile town under camera surveillance within two years.

    Though other cities like Chicago have set up cameras in high-crime neighborhoods, Bellwood will be the first town in Illinois, and possibly the first in the country, to have every public thoroughfare, sidewalk and alley under the watchful digitized eye of the Bellwood Police Department.

    . . . .

    Bellwood's mayor said he welcomed the suggestion that his town might be considered something akin to a Big Brother-land.

    "I wish we could create that image. I would love that," Mayor Frank Pasquale said with a chuckle. Although village officials say their town is not unsafe, and in fact crime has dropped in the last two years, they are aiming for a crime-free future.

Full article here. I don't know what's scarier...the mayor gushing over the "Big Brother" comparison, or the general lack of community outrage for having their entire public lives placed under surveillance.

This is a tough one to challenge. The objection to total monitoring is based on moral and societal -- rather than legal -- arguments, so it's by nature a much hazier playing field. Unfortunately, the tired, old "well if you're not committing a crime then you have nothing to worry about" rationale hits home with a lot of people.

(hat tip: Instapundit)

Posted by lengilroy at 10:41 AM

March 14, 2005

Greedy Governments III

    Chicago officials took the first tentative steps Tuesday toward installation of a citywide wireless network that would allow residents to connect to the Internet from easy chairs, school desks and office break rooms …

How nice of them.

But I’ve got to assume that a lot of the motivation comes from the next line:

    and provide City Hall with a major source of new revenue.

How much revenue might