Cities at Work Newsletter

  • How Mayor Nutter has Turned Philadelphia’s Fortunes Upward

    Listen to  Amie Devero’s full interview with Mayor Nutter on internet radio at Cities at Work on Blog Talk Radio. Just click to play.

    In preparing to write this article, I made the mistake of imagining I might gain an overview of the work done in Philadelphia by the Mayor and his administration over the last 4 years.  But in the 5th largest city in the US, so much is done all the time — and in particular during this administration — that it would have required several whole days of interviews and a book length article to cover it in any real depth.  So, instead of depth, I settled for breadth – too much to penetrate deeply in just 60 minutes.  But although there are many items presented here without fleshing out their details and nuances, there are links through the article which will provide greater information on the initiatives and approaches the Mayor shared with me.  Hopefully they will satisfy curious readers or students of local government with added substance.

    The Mayor of Philadelphia, Michael Nutter, had his hands full when he first took office in 2008.  Along with the recession and its corresponding high unemployment, Philadelphia hadn’t grown in population in over 50 years, adding to the $2.4 billion budget gap the Mayor had to confront.  But unlike many in public office, Mayor Nutter came from a particularly good background to attack the challenges he faced.  Having graduated from Wharton, one of the top business schools in the world, his understanding of finance and management was significant; and his years spent on the City Council made him an expert on Philly’s own way of doing things.

    I suspect most people, like me, will first want to know the answer to the most obvious question: What happened with the budget gap?   The answer is that the $2.4 billion gap was closed, and it was done through a spirit of “shared sacrifice”, based on a 50/50 ratio of cuts to revenue increase.  Nothing was off the table, but some things were further outside of consideration than others.  The choices of the actual specifics would emerge inside the very heart of the shared-sacrifice-model.  Instead of firing employees on a last in first out basis, or according to some other tried formulae, 1400 employees were eliminated, but largely through attrition.

    Between 2009 and 2010, the prison population was reduced 10%, and violent crime decreased and has continued to drop each year.  Reducing the prison population was a great money-saver, but required a constellation of programs and funding to succeed.  Undertaking this reduction began with a careful analysis of who, exactly, was in prison.  It turns out that a large number of prisoners were non-violent, and therefore, not a likely risk to public safety.  So wherever the penal law permitted, non-violent prisoners were released into alternative programs such as transitional housing and jobs programs.  Furthermore, businesses were incentivized with a $10,000 tax credit for hiring ex-offenders – something that was a substantial sweetener in a stagnant economy with too little hiring.

    In order to ensure that those who were released, either early or on time, remained out of prison, the City secured over $550,000 in outside grants aimed at reducing recidivism.  These efforts were compounded by strong anti-crime initiatives on the street and by an aggressive crack-down on illegal weapons in cooperation with State and Federal agencies. The result of these efforts includes a 21.7% decrease in homicides and a 12.7% reduction in violent crime in the City since 2007.

    Prompting hiring by businesses during the country’s worst recession in decades required creativity.  This is a challenge being felt globally, and while Philadelphia hasn’t solved the problem, it has made inroads beyond what was predictable.  From an economic development perspective the results are impressive and include both expansions within and relocations of major corporations to Philadelphia, bringing jobs with them.  Some of the relocations are within the city itself, including 2 major companies going into The Navy Yards, and preserving over 1500 jobs that could potentially have been lost to the city.  Some of this has been aided by the Mayor’s attention to new economy business.  Focusing on sustainability, green and high tech jobs as well as on education and the medical industries has assisted in creating the conditions for new jobs in growing fields.  The intent has been both to create a need for new human resources within businesses who could hire, and sufficient population of the right kind of talent to fill open positions.  New economy businesses often include those focused on sustainability and energy efficiency.  While encouraging green business has a positive impact on economic development, it also produces its intended environmental impact.

    In this double-pronged effort of greening and growing, Philadelphia has encouraged business and developers to embrace green technology and construction retrofits..  For example, a $40m fund has been established to provide bridge funding to businesses that choose to retrofit for greater energy efficiency.   Along with incentive programs for business, Philadelphia has modeled “greenifying” in municipal functions and operations  wherever possible. On-street recycling is available city-wide, and trash is picked using solar-power.  Each green initiative that takes a bit of carbon emission out of the environment also stokes the economy and job growth through start-ups, new projects, construction, and expansion.

    One noteworthy sustainability project under Mayor Nutter’s leadership has been a groundbreaking undertaking by local company NovoThermal Energy to create the US’s first commercial geothermal system, using wastewater to heat the building. “The … .. NovaThermal unit is located in the building’s basement from which it directly accesses the adjacent sewage channel.”   The idea behind this pilot program is to demonstrate the possibility of reducing the cost of heating buildings by up to 50%, creating a swell of sustainable development, retrofitting, investment and corresponding money-saving and reduction in carbon footprint.

    Along with cultivating new economy business growth, Philadelphia has also been attentive to encouraging new business growth, including start-up incubation, technology skills-building and an emphasis on entrepreneurialism.  To assist these new industries in their inception, relocation or growth, the City’s Commerce department has been transformed into a concierge style department, with a comprehensive business portal right on the city’s website.  Some of the specific projects and initiatives that fulfill those roles include Philly Tech-Week, Philly Start-Up Leaders, and many business incubators.  Philly Tech Week, having recently completed its second year, is 9 days long and includes over 80 events.  Its founder, Christopher Wink is committed to expanding its opportunities, and increasing the public’s participation in it.

    During this year’s Tech-Week, the Mayor announced his Executive Order opening the City’s data to the public (wherever consistent with privacy and security concerns ). While it is too early to tell if it is true in Philadelphia, one of the impacts of open government data policies in other major US cities has been to prompt the creation of applications and initiatives that utilize the city’s data as their fodder.  Those applications can provide myriad services to end-users and the City itself, whether culling and analyzing information about parking availability, increasing efficiency in public records searches or providing automated job-hunting for local veterans.   In the short term, however, it largely eases the paperwork associated with accessing information under Freedom of Information laws, making the business of the City’s business more open to all.

    In April of this year the Environmental Protection Agency launched a new program in support of the City of Philadelphia.  Green Cities, Clean Waters is a partnership  between the City and the EPA,  that aims to better manage the City’s storm water using green technologies and infrastructure.  “[The project] is pioneering a broad multi-decade investment in green storm water management practices that reduces sewer over flows to the City’s waterways and enhances communities and the overall environment. “  Green storm water management attempts to capture water where it falls, and immediately integrate it into natural activities like plant growth, landscape irrigation and eventual evaporation so that it doesn’t become a burden on sewers, and empty into rivers and streams, polluting them with the urban effluvia accumulated on the way.  The EPA/City project sets up a long-term plan for both entities to bring to Philadelphia, and eventually the country at-large, examples of new and innovative ways of managing storm water in an ecologically responsible way.

    There are a large number of unique initiatives under the collaboration, many of which will begin in the first five years as various infrastructure projects are in an implementation phase.  The plan is spearheaded by the Philadelphia Water Department, and will be executed over twenty five years.  For more information on Philly’s transformation to a greener city, read this current article in Living Green Magazine.

    One of the Mayor’s areas of interest has been in increasing the business excellence of the City’s operations, creating demonstrable efficiencies that can be measured.  Examples of the results include an increase in productivity in the Office of Business Services.  The time it takes to turn around a case has dropped from 23 to just seven days.  Business cases are also getting handled more quickly.  Most are resolved in fewer than five business days and many as fast as the same day.

    Finally, in order to address public health concerns and create a healthier environment, there have been a variety of inroads.  Among the new initiatives is $15 million which is going toward efforts to make healthy foods more easily accessible in the City by adding to the availability of farmers’ markets in neighborhoods where it is often difficult to find fresh foods — or where shops do not stock it — and by making that farm-fresh food more affordable. “ In 2010, the City created PhillyFoodBucks which are given to SNAP [food stamps] recipients who purchase fruits and vegetables at Farmers’ Markets—for every $10 purchased, the shopper receives $5 in PhillyFoodBuckswhich can be used to reduce the cost of future purchases.”

    Now it isn’t even close to the end of Mayor Nutter’s reign in Philly, but I still wanted to know what he might offer in the way of guidance to other city leaders who are out to produce great results.  His advice was eloquent, but at its heart, rather simple.  “Know your budget and your core principles, and be honest with the public.”  And once again, showing his business background, he explained that in truth, he was the CEO of a $4b operation, with 22,000 employees, and Board of Directors in the City Council and 1.5m shareholders – to all of whom he must answer.  But his management and finance acumen never overshadow his commitment to public service and to distinguishing government from business.

    As I said at the onset, this is more of a wide-angle view than an in-depth expose.  As is probably obvious, there are simply too many projects to try to be comprehensive in a single article.  Perhaps Mayor Nutter will write a memoir of his administration eventually, and elucidate many more of his efforts, successes and perhaps, failures too.  But it bears saying that as the incoming President of the US Conference of Mayors, Philadelphia’s Mayor is a great example to others throughout the country and the world.  Perhaps the most telling statistic is the advent of the first population increase in Philadelphia in over 50 years, as revealed in the 2010 census. In some ways, that says it all – people are coming to Philly!

    For Mayor Nutter, his closing admonition to Mayors and city leaders – and probably to all who want to better the place where they live, work and play, is:

    “Love your city.  Love your people.  Love your work.  Never stop trying to do better today than you did yesterday.”

    For more information on any of the projects or departments mentioned here, use the links provided, or visit the City of Philadelphia’s web portal, where there are copious quantities of information, links, documents, videos and much more.  It can be found at www.Phila.gov .

  • New Success Built on Old Strengths: How Des Moines Keeps Winning

    Listen to the full, unabridged interview with Mayor Cownie.*

    As I prepared to interview Frank Cownie, Mayor of Des Moines, the sheer quantity of awards this capital of Iowa had received started to seem overwhelming.  Just to further compound that sense of overwhelm, hours before the scheduled interview date, Forbes Magazine named Des Moines the number 2 city in America for finding a job, behind only Washington DC.  It was hard not to wonder… What’s so special about Des Moines, Iowa that has elicited so much praise?

    One of the things that emerged in the course of the conversation was that, while so many cities have been focused on looking for the newest, coolest, highest tech solution to modern challenges, the answers often reside in the least trendy of places.  Not high tech, but low tech; not sophisticated, but fundamental; not novel or innovative, but instead, the familiar and fundamental.  A lot of what is working in Des Moines and in Iowa is a modern approach to leveraging traditional products and services, using long-lived core competencies, and creating new business models from within the heart of bedrock industries that have been here forever and yet are as essential and valuable today as they were in the early 19th century.  So, while other communities may focus their economic development efforts on attracting new technology companies Des Moines remains focused on its core strengths: financial services and insurance, and the new businesses that synergize with them.

    Des Moines is set located in the center of America, at the juncture of two rivers, the Raccoon and the Des Moines. It is located on and surrounded by some of our nation’s most fertile and productive agricultural land and has the Midwest vista that many see as charming, with 2 rivers that wind through town, scenic bridges and the natural undulations of the land formed by the movement of water over millennia.  It also has huge temperature and precipitation fluctuations from season to season, with copious rainfall in later spring, and consistent snowfall during the winter.  Plus, it is prone to flooding and has experienced the worst in its history over the last 10 years, including a flood in 2008 said to have been the “high water mark” of the previous 500 years. To compound the flooding and freezing temperatures, Des Moines is in a tornado zone. The Mayor, T.M. Franklin (Frank) Cownie, is intimately familiar with all of these Iowan traits. He was born and bred in Des Moines, as were his parents before him.  Among many business interests, Cownie owns and operates Cownie Furs, a descendent of Des Moines’ history as a fur trading capital.  Cownie’s business background, coupled to a core belief in public service has led to his strength in building business and government collaborations and partnerships. That mix of private and public working in concert has helped to create a period of growth and accomplishment previously unseen in Des Moines.

    Even before Cownie was mayor, Des Moines had a proud tradition of investing in beautification programs throughout its neighborhoods and parks, as well as in it s downtown corridor. So there was a path and community commitment in place for ongoing investment in quality of life programs.   The community is proud of its ongoing investment in quality of life programs.  But the work done under Mayor Cownie’s administrations has significantly contributed to that trend.   In the last 5 years alone, Des Moines has won more top ten rankings than is practical to list here.  Amongst that enormous list of accolades and top rankings are high rankings in the following lists: 10 Best Cities for the Next Decade (by Kiplinger’s), Best Cities for Young Professionals (Forbes), and the Best for Business (MarketWatch).  There are another 30 or more similar accolades the City has been awarded during the past couple of years.  They are all listed on both the Convention and Visitors Bureau the City’s and the the Greater Des Moines Partnership’s websites.

    So you might say that something is working in Des Moines.  Much of what Mayor Cownie describes conjures a sense of an ethos of attending to the city’s livability on an ongoing basis.  Rather than provide a list of specific projects, he points to a perpetual conversation with business owners and other City customers about what is important to them.  Some examples of the ongoing collaboration between the City and its businesses include the Principal Riverwalk, the World Food Prize, an exemplary public art project, 4 miles of weather protected sky-walks and more.

    Cities have all seen a rise in interest in their downtowns, and have largely encouraged that growth in an effort to re-grow city centers and bring vitality back from the sprawling suburbs.  But often, efforts to grow a downtown end up with high-end condominiums occupied by wealthy retirees or high-paid executives, and no affordable housing for the people one hopes will work in the restaurants, bars and retail outlets that the city leaders visualize lining the streetscape.   Des Moines has grown more than its commercial property occupancy rate.  It has grown a vibrant downtown community for all ages and economic levels.  The skywalks mentioned above were not just for comfort.  (“[T]he thought was that by putting skywalks on the second level of buildings, retail corridors could be created at the entrances to those skywalks. Shoppers would stop to buy while walking to the garage or to lunch.” That is to say, the intent behind much of the infrastructure investments has been to consider how it would impact all potential customers, including large companies, but also, service employees, renters, homeowners, retail and visitors.  Des Moines has experienced a 400% Increase in rentals, so it seems that the steps taken to build a magnetic downtown have worked, attracting people of all walks of life, income levels and background to live, work and play in the downtown.  It is not a downtown with only banks and insurance companies, it is a city that also has rental housing that young service employees can afford, making it possible to live and work downtown, and possibly walk to work rather than drive.  The fact that the cost of living in Des Moines is 8% lower than the national average certainly helps young people and lower wage employees to live better and closer to the city center – as it does all people.  Having a concentration of businesses, housing and recreation in the downtown also makes it possible to live comfortably without the pressure of expenses like car repairs and with reduced anxiety about rising gas prices, as driving is less critical than it is when commuting miles to work every day.  Of course, less driving also helps to reduce the city’s carbon footprint, adding to its overall greenness – something else that the Mayor believes is critical to his city.

    The Mayor’s office along with the Greater Des Moines Partnership all spend time regularly visiting with businesses of every size and looking for ways to enhance the business environment and build the vitality of the city’s economy.  Of course, in some ways, this is true of every city.  But there is unique character to Des Moine’s strategy.  Across the country, cities are attempting to form industry clusters – often to replace clusters that are believed to be too low-paying or insufficiently “modern”.  In Des Moines, they could hardly have more traditional industry clusters.  The city’s economic foundation comes primarily from the financial sector, from financial services and insurance.  And Greater Des Moines is also home to many agricultural businesses, including Dow Chemical and Monsanto.

    But instead of seeking to replace or displace those stalwarts, they have developed new and novel ways to build an entire ecosystem of industry in support of those business segments.  For example local business incubators support budding entrepreneurs who have innovative business ideas by renting them space very inexpensively and providing mentoring through the incubator.  That’s not unique – incubators are popping up all over the country – and there are plenty in Des Moines, with various missions and focuses.  In one incubator in particular, a requirement of these start-ups is that they be in the business service or service area.  For most start-up businesses, despite the advent of Internet marketing, it’s easier to sell locally where you can realistically meet your prospective customers and look them in the eye.  By directing new businesses toward a synergistic role with already sustainable local business verticals– the insurance industry, the agricultural trade, sustainable building and so forth—developing businesses grow into a kind of instant role in a supply chain, strengthening the entire local economic system. So along with the globally-oriented technology start-ups and Internet companies that are growing in Des Moines (especially with the support of the universities and community colleges), there is an emphasis on building businesses that will find a strong, already fully developed, economic base in Des Moines.

    This emphasis on the traditional, long-standing businesses has several very modern twists on it – some of which have global implications.  As an agriculturally rich part of the country there are a number of ancillary businesses that are also strong – those that support agriculture. It’s no surprise that John Deere is based in the state of Iowa and its financial services and logistics divisions are headquartered in Des Moines.  Many other farm equipment companies are based in the region, like Vermeer, based in Pella, and the seed company Pioneer (a subsidiary of Dupont) is in greater Des Moines.   So this ecology of industry clusters in and around the businesses that have been stalwarts of the Iowan economy for decades, continues to flourish.  As important as this is to the local, regional and state economies, there is also a global advantage.  Nationally, the pressure is on to grow GDP and shrink the nation’s trade deficit.  With that in mind, finding ways to sell outside of the local – even outside of the national economy — are inherently smart moves.  Exporting to China, India, Pakistan, Africa, Latin and Central America and more are ways to build the country’s trade strength – and ways to build a local economy as well.  Recently, Chinese Vice President Xi Jinping visited Des Moines as part of a trade mission to the US.  The resulting deal is bringing upwards of $4.3b in soybean purchase alone to the local economy.   That kind of deal casts the trade deficit in a slightly different light – the same new perspective that pervades the Des Moines success story: Traditional products and services that form a core competency in the Des Moines region, are more exportable than manufactured new technology.

     

    While the Chinese and other Asian economies may be able to provide low-cost manufacturing of high tech goods, they lack many of the natural and cultivated resources we have.  They can never produce enough nutritious food for their population; there simply isn’t enough land.  They are unlikely to master the kinds of agricultural skill, agri-technology or the development of farming and other heavy equipment that we have.  They don’t need to – they can buy from us. They can certainly develop brains and innovate in a variety of areas – but no future will eradicate the need to grow or eat food. With China’s growing population, a commensurate need for biotechnological know-how and the food it produces exists – and with its growing economic strength and the corporate and personal wealth that comes with it will come a demand for food that is attractive for survival and attractive for discretionary spending.   That allows for the natural evolution of the agricultural cluster in and around Des Moines to continue to grow in its sophistication, encompassing biotechnology, bio-engineering and so forth.  But the theme is clear,  it is all organic growth, none of it artificially constructed for the sake of “economic development”.

    Returning to the mayor’s commitment to “greening” Des Moines, this too is far more than PR or artifice. The Mayor has advocated for and has been joined by the city as a whole in supporting adoption of environmentally friendly technology and sustainable practices and principles for at least the last six years. “In 2006, the City Council adopted twelve goal statements, one of which was for Des Moines to become a Sustainable Green Community. In 2007, City Council adopted the Energy Conservation and Environmental Enhancement Policy which provided goals and a number of principles based on the built environment, the natural environment, and property management, acquisition, and disposal.”    In November of 2011, Mayor Cownie was awarded the National Environmental Hall of Fame Award.  Des Moines has the first public library likely to be certified LEED Platinum (Franklin Avenue Library) as well as the first certified LEED Platinum commercial office building of its size in the world (Wellmark Blue Cross Blue Shield building.  And the City’s annual report contains a substantial sustainability section. The Mayor’s and the City’s highly visible efforts on the green front has produced so much of a groundswell that many local businesses are embracing the ROI of investing now in sustainable development.  They receive incentives from the City, but the level of support goes beyond that.  The businesses undertaking LEED certification are not simply looking for tax credits, they see a long-term and perpetual ROI on going the distance toward sustainability, and doing so now.  Moreover, in every project and initiative – many of which have no direct green-oriented impetus – sustainability emerges as a benefit.

    I started off by referencing a culture in the Des Moines City Hall of collaboration between the local government, the business community and the citizens. That clearly exists.  The large companies in Des Moines, those in the insurance and financial services industries, clearly have had a hand in supporting the ongoing economic strength and growth of the city.  They are significant job-creators with a stake in continuing to attract smart employees.  Des Moines has a lot of those kind of businesses, more than many cities their size (1 for every 568 residents).  But that same culture of involvement penetrates to a far more grassroots level than is common.  Rather than there being a clear delineation between the participation and dialogue of the city with huge companies versus mom and pop enterprises, there is genuine collaboration between large and small businesses, profit and not for profit, elected officials, City employees and citizens who are all dedicated to working together.  For example, in the East Village, an area that had lost much of its luster over years and had several buildings slated for demolition, the City got on board with a potential project that required the buy-in of residents and businesses in the neighborhood.

    The buildings (like those in many parts of America) had been built in the 1960s.  They were products of an aesthetic that envisioned a future of cement, with sweeping vistas of blank walls.  The renovation concept started with that visual impact. A common approach to that issue is to tear everything down and start new.  But of course, new buildings look, well… new.  Des Moines had developed a master plan for the redevelopment of its downtown corridor which incorporated renovation of historic buildings with unique architecture that has made the landscape a brilliant combination of new and old.   So in the East Village, instead of a clean sweep, the proposal was to remove all of the facades and to reveal the brick beneath, or in some case, add brick and make the street look more varied and less planned.  The City in collaboration with local citizens offered to provide all of the streetscaping necessary to support the new facades.[i] Along with that streetscape plan, and in a commitment to include local talent and local visions, they held a contest for cool design of bike racks.  Again, the City returns to its sustainability theme…encouraging the use of bicycles without adding regulation or even talking about cycling per se.  Designs ranged from free-form sculpture to a metal, spotted dog lifting his leg – and all of them are bike racks.  Over the course of 10 years or so the area has become a trendy place to live, work and visit.   Perhaps most importantly though, the successful transformation can be owned by everyone.  The city had a role – but so did the developers, landlords, business owners, residents and cultural groups.

    For most residents in most cities, quality of life is a truly personal and local phenomenon.  While grand city issues are extremely important – everything from the comprehensive development plan to jobs growth – most peoples’ direct experience rarely extends far beyond one’s own block or dog-walking range (or commuting traffic).  In Des Moines, the City has taken the same collaborative approach at the very local level, with an outreach program that goes directly to the neighborhoods to listen in at meetings, offer information and solicit ideas for how to make life better at this very local level.  They do this in a couple of ways. Des Moines has 61 strong Neighborhood Associations whose leaders work with the City to identify issues and opportunities.  This system has enabled the effective allocation of resources and empowered neighborhoods to prioritize their needs, cultivating a partnership between the City and Neighborhood Associations that has led to satisfaction and benefits beyond what one can quantify.

    In addition to the collaboration between Neighborhood Associations and the City, Des Moines has a “Neighborhood Based Service Delivery Program” that sends Parks, Police and other City professionals to neighborhood meetings quarterly, to both hear the specific concerns and mood, and to solicit input. “The primary objective of these teams is to assist neighborhoods in identifying and prioritizing concerns, planning a course of action and implementing solutions to solve problems.” The Police even have a Facebook page to promote and support their efforts.

    There is clearly much more to say about Des Moines and its success.  Maybe the best way to find out if it all really is as great as every media outlet in the country has suggested is to go there.  But in the interim, Mayor Cownie offered his perspective on what he has learned as mayor, and what he thinks might be helpful to those who may want someday to lead a city, or those who find themselves in that role already.  It comes down to collaboration and working together.  He has led through example and through demonstrating that shared visions have more support and success than those that are dictated.  Like most businesspeople, he couches this approach in strategic terms.  It’s critical to know where you want to go, to have a vision – one that includes your own as Mayor, but also the vision of the citizens and businesses in a shared whole.  But to achieve that, you have to start by evaluating where you are now, what your strengths and weaknesses may be, and create clear plans to accomplish filling the gaps between the present and that future. In Des Moines, many of those plans are in place, and while the City seems to have succeeded in fulfilling a vision, Mayor Cownie sees a great deal further to go.  His vision is to continue to create more economic, cultural and quality of life opportunities in Des Moines.  Given the track record of accolade piled on accolade, it won’t be surprising to see that trend continue.  But perhaps by watching how Des Moines shapes its future those of us in other cities can improve the quality of life in our hometowns, and perhaps join Des Moines on the one or several Top Ten lists.

    Additional Materials

     

     

     

     

     

     


     

     

    [i] Janis Ruan lead the downtown landscaping  vision along with the Fleur Drive renovation which was funded by Ruan Companies and the City

    * Although the interview is complete and unabridged, additional material is included in this article.

  • Grapes of Wrath In Reverse: Oklahoma City as Land of Opportunity

    I recently had the opportunity to spend some time interviewing Mayor Mick Cornett of Oklahoma City about the huge transformation of his city, both in terms of how it’s perceived and its real economic results.  As an aside, my plan had been not only to provide you with a written summary of our conversation, but to post an audio file so that the entire interview would be available.  Alas, the technology gods were frowning, and when I hit “play back” on my (allegedly) state-of-the-art audio system, the hour-long recording was empty – yes, completely empty.  So, for this first issue of Cities at Work, only a written record is available.  However, I have the assurance of Mayor Cornett, that if clarity is lacking due to the author’s poor recollection of detail, he will respond to any questions or points of clarification you make.  So send your questions to me (see end of article for email link) and I will be delighted to pass them on to the Mayor. 

    -Amie Devero-

    If you happened not to hear the laudatory news of Oklahoma City’s (OKC) growth and vitality, then it could only have been because you haven’t paid attention.  Amongst some of the recent accomplishments by this capital of the great State of Oklahoma have been:

    • Kaufmann Foundation Names OKC  “#1 City in America to Launch a Business” in (Oct., 2011 ).
    • Oklahoma City Named One of the Nation’s 100 Best Communities for Young Peopleby America’s Promise Alliance and ING (Oct. 2011).  Along with this ranking comes the   information that OKC has more start-ups per capita than any other city in the US.
    • Devon Energy commits to building a 50 story skyscraper in downtown OKC, the first skyscraper to begin construction in the US since 9/11 – and further promises to stay in OKC and continue to build their workforce of 2000 plus high-wage employees.
    • The Boeing Company moved over 250 high-paying jobs from Long Beach, California to Tinker Air Force Base in OKC.  Just two weeks ago Boeing announced a closing in Wichita, from which they are moving a further 800 engineering jobs to OKC.
    • Continental  resources announced a move of 250 workers from Enid to OKC.

    These are just the most public and visible items coming across the transom.  In fact, there is a ton of activity going on, and much of it has been funded through municipal tax-dollars, and supported through the ensuing private sector activity.  So how is it possible that in a national economy with 8% unemployment, a widening income gap, lack of affordable housing and a foreclosure bust, OKC has bucked the trend on all counts?

    Well, as you might imagine, some of it is luck – or at least conditions that no one can take direct credit for producing; some of it is geography; and some of it is culture, a culture of good planning and a strong cohesiveness between the city’s leadership in all factions and its citizens.

    Geography is a plus for OKC, lying as it does at the crossroads of three major Interstate highways – I-35, I-40 and I-44.  That makes getting there pretty easy.  And while it might not seem obvious, one great result of that positioning is a steady flow of tourists and their dollars into OKC – as even in the midst of a recession, a weekend away by car is still a popular choice for a family getaway.

    Another fateful historic OKC  fact was that it never had a 1990s property boom.  Well, the upside of no boom is that there is no bust.  As a result, property prices are stable, and foreclosures are at predictable levels for normal economic times , not astronomically high as they are in so many other parts of the country.  Without the pressure of a property bust, construction activity has been stable and now, as a result of the huge amount of growth in downtown, really strong.
    By strong, I mean, construction is hopping. The downtown is growing.  There are so many projects underway that a sea of cranes hovers within the skyline.  Amongst the projects are the Devon Energy Center skyscraper, a redesign and rebuilding of the entire downtown street grid including the addition of a boulevard and narrowing of most surface streets and the construction of several hotels.  Plus, there is much more on the drawing board.

    As the Mayor spoke, mentioning project after project – most funded by the City—one couldn’t fail to wonder how they are paying for all that.   Cities across the country are broke and finding it impossible to maintain services and necessary infrastructure upkeep, and OKC is pouring dollars into development.  The answer may begin to reveal the distinct culture that seems to be unique to OKC.  It’s a contradictory reality in a city in the most conservative and Republican state in the nation:  Taxes are the source of the funds.

    So how did the OKC city leaders successfully levy taxes to the tune of approximately $90 million dollars a year over the last fifteen years in a conservative, Republican stronghold?  Well, this may be, at least in part, a function of the very special culture and sense of unity that OKC has.  “People in Oklahoma City put the city first”, says Cornett.  He adds that the sense of strength and city loyalty may have been deepened by the 1995 bombing of the Alfred P. Murrah Federal Building.  But that “all for one” culture didn’t start there, because the project-funding taxation began before 1995.

    One clear symptom of that unity is a truly cohesive city government.  While so many American cities are subject to untold municipal shenanigans, from public shaming to Mayor versus City Manager infighting, corruption and embezzlement and frequently  dysfunctional City Commissions and Councils, OKC’s government works together.  The last several Mayoral contests featured easily reelected incumbents. But even in open elections (1987, 1998 and 2004), despite highly contested races, the adversarial campaigns do not translate into adversarial administrations. The City Manager (who actually holds most of the decision-making authority) has been the same person for 11 years.   Further, each new Mayor has embraced the projects that were begun by the previous Mayor, allowing an extraordinary and rare continuity that makes for substantial productivity.
    But such a strong culture can’t build a city on its own.  It took a unique set of projects and associated taxes to get things going and some strong and persuasive skills to get everyone on board.  After all, even in OKC, retired suburbanites are liable to balk at being asked to fund inner city school development.  So, one piece of the puzzle was the Mayor, City leaders and Chamber of Commerce being able to speak to suburbanites and retirees in a way that made sense and resonated with their priorities.  That evangelism started a long time ago, and spoke to the focus of every grandma and grandpa’s greatest concerns – being close to their grandchildren.    Clearly, if there are no lucrative jobs for young people in the city, then homegrown talent will leave, and they will not come home except on the rarest of occasions to visit.  It seems that an OKC brain drain would have touched grandparents where it hurts most, in their hearts.

    The funding projects themselves were accomplished through a series of phased and goal-based initiatives called MAPS(Metropolitan Area Projects).  There were three projects, each one limited and paid for with a $.01 sales tax.  The unique aspect of these taxes was that they had the following qualities in both conception and practice:

    • Closed-end duration
    • Intended to fund specific projects and ONLY those projects
    • No budget over-run funding

    These programs generated a huge amount of funds, and because the funds were earmarked for long-term projects, they also grew in interest as the projects they were meant to fund came to fruition.  Each MAPS project was specific and themed.  The first MAPS project started in 1993 and during the 66 months it was in effect raised $309 million in tax revenue.  In addition, the tax revenue earned interest of about $54 million, also used for the MAPS projects.  In an unusual move, the program was extended by six months so as to “finish MAPS right” – hence its additional six month duration.

    MAPS 2 was primarily used to fund school improvements so that the educational environment would be raised to the standards expected of a growing city that planned to be home to lots of high-paid workers.  MAPS 3, currently underway, is focused on an anticipated huge increase in population by 2030, many of whom will be over 60 years of age.  So the goal is to create a “senior-friendly” city, where all of the lifestyle conditions and services are available for an aging population.  The specific areas of work for the dedicated tax revenue and interest from MAPS 3 will be Community Centers, improved transit (street cars), enhanced and added sidewalks and finally, trails for biking, walking and jogging.   Amongst the great outcomes of MAPS 3 will be senior wellness centers throughout the city that provide swimming pools, fitness classes, libraries, crafts studios and social areas for residents at very low fees.  The total projected revenue (not yet complete) was expected to be raised over the 7 years and 9 months of the MAPS 3 tax period is $775 million  To date, it is ahead of target.

    It hasn’t all been good news – there have been significant hurdles.  In 2008 General Motors closed a manufacturing plant that employed 2300 people.  The loss of the plant was at the source of as many as 4700 job losses, putting suppliers and vendors out of work as well as auto-workers.  But in a fascinating bit of creativity, the county went to its hometown Air Force base and to the Pentagon, to offer the building to the military, tax-free, for its use.  The military was delighted at being able to add to its infrastructure with no investment, and at not having instantly to address its own aging facilities.  This served the county and its incorporated cities despite the expected cost, by avoiding the blight of a disused plant, deepening its ties to the military and the base, and ensuring that jobs in the re-purposed GM plant would eventually come back as jobs for the military.  To accomplish this, the county went hat in hand to the citizens – albeit buoyed up by chamber financial support.   Despite the potential added burden and risk, the county voters, including those in the city of OKC, approved the expenditure of $50 million to purchase the plant and lease it to the military for $1.00 a year – on the condition of the military creating jobs.

    It should go without saying that the migration of more and better paying jobs to the region, coupled to the intense investment made by the county, the city and the chamber in its own assets, also attracts investment from the private sector.  Businesses and non-profits have taken note of what is happening in OKC and they have acted on that.  This is where one ends up back at the beginning of this story– OKC has the most start-ups per capita in the US.  Not an accident, a consequence.

    There is much more,  but let me just jump to the end of our conversation.  When asked what the biggest lessons have been of his leadership of Oklahoma City, Mayor Cornett shared some very interesting insights and admonitions.

    • Mine for gold in the city’s most critical resource, its people.  Use focus groups and surveys and whatever other tools are available to really understand what the customers want and care about, and use that information to develop strategy and initiatives.
    • Beware of boom times.  When things are going ridiculously well, stay aware that they can go badly just as easily.
    • Take the steps to ensure “clean” hand-offs.  It takes a long time to learn the job of Mayor (or City Manager), and having to reinvent the wheel can easily use up 75% of a term.  Whenever possible, build from the past, not over it, and keep continuity with the last administration’s focuses, projects and strategy.

    Mayor Cornett isn’t arrogant or willing to rest on his laurels.  There is still more to do, and undoubtedly obstacles ahead.  But right now, Oklahoma City is enjoying the fruits of its labors and its patience.  A city isn’t built in the course of a single Mayor’s administration, but in a succession of strong leaders who can forge a bond with citizens so that the entire city moves forward together, persistently, with discipline and a shared commitment to the future. Oklahoma City, in a fashion reminiscent of the cattlemen and homesteaders of its history, through old-fashioned planning, hard work, and steadiness – an approach that apparently is as effective in the 21st century as it was in the 19th.
    To hear more directly from Mayor Cornett, watch the City of Oklahoma City State of the City address, being aired on CSPAN.  Also, send questions for Mayor Cornett by clicking here.