A tool kit for value capture policies

Harnessing the value of public assets to support the civic commons

It’s widely recognized that public assets, like parks, libraries and community centers, generate important and tangible benefits for their neighborhoods. But it’s seldom the case that the value of these benefits is tapped to help generate revenue to enhance and maintain the public assets. A new toolkit developed by U3 for Reinvigorating the Civic Commons outlines programs and tactics that neighborhoods and cities can use to capture value from public assets.

Value capture strategies are based on the observation that well functioning public facilities often contribute to local economic growth, business revenues and property appreciation.  Much or all of the economic value from these facilities often spills over to or benefits neighbors or adjacent properties, but doesn’t directly provide additional revenue to finance or maintain the facilities themselves.  Value capture mechanisms aim to close this loop by capturing a portion of the value created by a public investment and using it to help support the asset itself.

Value capture can play an important role, especially in rapidly changing neighborhoods. Public resources, like parks, often play a key role in stimulating additional investment and drawing new residents, with the perception that there’s little benefit for existing residents of the neighborhood. Value capture mechanisms, like tax increment financing, can create a pool of resources for maintaining or improving the public realm, or as some cities have done, subsidizing the construction of affordable housing that keeps the neighborhood accessible for households from a range of different incomes.

The toolkit sketches out a range of different value capture mechanisms, some of which have been employed widely around the country, and others, like land value taxation, that are relatively rare.  The report discusses at what scale (project, neighborhood or city) each mechanism is most appropriate, as well as their merits and drawbacks.

U3’s value capture toolkit was developed collaboratively by practitioners and  philanthropic, economic and civic asset experts. (Full disclosure:  City Observatory’s Joe Cortright participated in this group).  A beta version was of the value capture toolkit was reviewed at a Civic Commons Studio in Philadelphia earlier this year.

Cities, Ideas and Us: Paul Romer’s Nobel Address

Cities are critical to expanding the circle of “us” and generating the new ideas that propel progress

In October, Paul Romer was awarded the Nobel Prize in the Economic Sciences for his work on technology and economic growth.  This past weekend, he gave an address in Stockholm, explaining the gist of his work and its implications.  While on the surface, the economics of long term growth might seem extremely wonky, Romer gave a lively, accessible and entirely non-technical talk touching on a the nature and sources of well-being and development, the critical importance of inclusion to economic growth and the central role of cities in bettering the world.

Paul Romer’s Address to the Royal Swedish Academy (December 8)

A video of Romer’s address is here.  It’s just more than a half hour in length, and well-worth the time.  Here’s our take on what Romer said, punctuated with excerpts from his remarks.

The core of Romer’s work is the observation that our capacity to generate new ideas is essentially limitless. This stands in contrast to the long dominant view that economic growth hinged on, and was limited by the inherently finite nature of physical resources.  This has the dour Malthusian implication–the one that earned economics the nickname “dismal science”–that a growing population inevitably means fewer resources per person.

The Malthusian theory has another implication–not about the trend– but what about what economists refer to as a scale effect.  What’s the effect of having more people at a point in time? Suppose you have twice as many people. Here the conclusion is very grim. Twice as many people means half as much copper per person.  This is just a arithmetic.

This pessimistic, zero-sum world view is deeply imprinted in our behaviors and social structures. We still think and act much as did our stone age ancestors, viewing outsiders as “others” and a threat to our well-being.

Homo sapiens emerged during the Pleistocene, in an era when this Malthusian theory applied with full force. The elements of human nature were shaped by this experience. I want to emphasize the predisposition we have to group people into us and them. Them is a group that poses an existential threat to us. They might steal our resources and there is also an opportunity we might be able to steal their resources from them. Even if all we do is share, there’s less for us when there’s more of them.

The good news is that ideas, unlike physical stuff, can be shared without limit. Our ability to create new ideas, to extract greater utility out of our fixed quantity of physical resources is the process that powers growth. Ideas, everything from the pythagorean theorem, to the photovoltaic effect, can be infinitely shared and re-used without diminishing their utility to all other users. And because each additional mind turned to the task of figuring out better ways to do things potentially adds to our stock of ideas, a larger population implies not less per person, but more.

Ideas mean that people are no longer our rivals–they can be our allies– and this suggests very important possibility that we can take the set of us and expand it.  We can draw bigger circle to include more people inside us, and treat them with the at least indifference or the small appreciation that comes from membership in the set of the set of us.
The implication of this is that the more people we can include in the circle of those who can contribute their labor and genius to the economy, the better off we will be. (This is a key reason why immigration has been such a powerful factor in driving US economic success, and why globalization has increased living standards for the vast majority of the world’s population).  But as current political trends illustrate, we’re a long way from having nations or a world that fully accept the importance of inclusion. The task of shifting human behavior from the zero-sum, beggar-thy-neighbor view to one that recognizes that we all benefit when each of us is able to live up to their full potential, remains to be realized.
Romer parses human progress into three fields, population growth (the vast expansion in human numbers, enabled by agricultural and industrial productivity), material progress (our ability to break the Malthusian cycle, and increase per capita well-being, and finally human progress, our ability to adapt as individual and societies to have a different set of values and behaviors than our predecessors.  We have progressed in this vein, but have further to go:
There’s a third notion of progress, I want to call human progress:  progress not in what we have but in who we are.  It’s the kind of progress that comes from seeing other people–even perhaps starting to see other sentient beings like the the animals we interact with–seeing them as part of us, treating them with at least indifference rather than malevolence and treating them as objects of predation. This type of progress in who we are is even more important than the material progress.
I know that the moral reasoning suggest that we should be capable of that kind of human progress even if in some sense it works to our disadvantage.  But, I must be honest: people are people. It’s a lot easier to get people to think of others as allies, if in fact those others actually help them and this is what the period of explosive population growth shows:  on balance it’s better to have more people they are our allies, they are part of us.
The best example of how this process of expanding the circle works, and produces benefits for all of us, is in the fact that we live in cities. We choose to live in cities, and value them, because of the advantages they afford due to the close proximity of lots of other people with many different sets of skills.
We live in cities with millions of people most of them are strangers and we’re not threatened by them and we don’t try to attack them. This is something that our ancestors in the Pleistocene could never have understood.
Let me just hint at some practical policy applications that emerge from this economics of ideas.  One is to think of cities as chances for people–especially in the developing world–to get the benefits of interaction with other people. Other people are beneficial on net and the words of my colleague Ed Glaeser,  cities make us smarter.

Our ability to enlarge the circle of “us” is critical to achieving the economies of scale that enable idea creation to make our lives better. Cities that work well bring people together, and create a more inclusive “us.” What Romer’s work underscores is that inclusiveness, and the way in which we build great urban spaces is at the heart of both improving human well-being and assuring that its benefits are widely shared.


The limits of Nieman Marcus environmentalism

Conspicuous non-consumption is really faux environmentalism; climate change is a social problem, not a personal one

We’re in the midst of the holiday shopping season, a potent reminder of how consumerism dominates so much of our lives. Even before black Friday, merchants have been flogging their holiday wares; even before all the  Halloween candy had been eaten, the Christmas catalogs were in the mail.  While it’s a reminder of the commercialism that so dominates the season, it also provides a window in the way in which we’ve conflated consumption with status and virtue signaling.

For more than 90 years, Dallas-based department store Neiman-Marcus issues its famously extravagant catalog with a range of complex and exotic goods. It’s not clear how many people purchase, for example custom-made suits of armor, Boeing business jets, or a submarine, , but those that do are no doubt signalling to others, by their purchase, that they have high levels of wealth. It’s a classic behavior of conspicuous consumption, a term coined by Economist Thorstein Veblen in the 19th century.


While that kind of extravagance may be seen as signalling status in some quarters, for many, we really want to let other people know that we care about the environment and that we embrace green values. And for many of us, apparently, It’s not so important to be green, as it is to feel green, and to  be seen by others as being green. Corporations, non-profits and many people are devoting considerable effort to demonstrate their environmental sensitivity to others. That was reinforced a while back when we got an unsolicited promotional request from a consultant who helps companies and cities with branding.

The consultant describes and praises various efforts organizations have employed to differentiate themselves or their products as green or socially responsible. An oil company blended some lower carbon ethanol into their product, and made hay boasting about its (somewhat) lower greenhouse gas emissions. Pizza Hut has famously flogged its efforts to fill potholes. But no one should mistake this kind of self-congratulatory corporate virtue-signalling as a serious response to either climate change or deteriorating infrastructure.

Individually, this greenwashing is harmless enough to simply ignore, but collectively it  pernicious because it creates the illusion that we’re doing something serious to solve these problems, and it thereby  whole diverts energy from the social and political consensus needed to take steps that would deal with these problems at scale.

The pernicious stuff includes, for example, as we’ve documented at City Observatory, the demonstrably bogus claim that a $31 million suburban parking garage–which provides unlimited free parking for employees and visitors–merits any kind of recognition as an environmental paragon, notwithstanding that the US Green Building Council awarded “LEED Platinum” status to just such a garage built, ironically, by the National Renewable Energy Research Lab.”

Similarly, Apple, which has just announced its building a big new campus in the suburbs outside Austin, Texas, brags that the buildings will be powered by 100 percent renewable energy.  Just don’t pay any attention to the fact that the facilities 15,000 employees will all have to travel by car to reach the location because its so remote from the city center and the region’s transit system. The energy consumed by commuting will dwarf the emissions that would be associated with heating, lighting and cooling the building.

The problem with ignoring the energy use associated with commuting and providing green certification for parking garages is that it simply rationalizes sprawl and automobile dependency, and reinforces the illusion that modest technical fixes (especially ones that are endorsed by the certifying agencies) are all that is required to solve the big global challenges we face.

Clearly consumers want to identify themselves and their actions with those who care about the environment, but this kind of branding and mostly trivial actions have almost no meaningful impact on the larger problem.

These often expensive and showy displays of public greenery are not really intended to do anything serious to affect the environment. Instead, they are, as Thorstein Veblen described them acts of “conspicuous consumption” or what we might now call “conspicuous non-consumption.” They’re not undertaken to solve a problem, but merely to bolster the image (or salve the conscience) of the person or organization taking the action.

UCLA economist Matthew Kahn documented that people who lived in communities with more Green Party registered voters in California were more likely to engage in a variety of green behaviors, including riding transit and owning hybrid vehicles. Interestingly, though, he found that greens were disproportionately likely to buy a Prius (a vehicle available only as a hybrid model, signalling one’s green credentials) as opposed to car models that offered both conventional and hybrid powertrains.

By@daguilarcanabal Via Twitter 

Wearing our hearts on our sleeves–or on our bumpers, is no substitute for policies that address problems at scale. A Berkeley Prius owner may rail against overpopulation on their back bumper, but apparently has no qualms about taking advantage of highly subsidized on-street car storage.  Berkeley neighborhood parking permits run $66 per year, or about $5.50 per month, or less than 20 cents per day.

Just as consumerism has twisted and overshadowed the meaning of Christmas, so too does Nieman-Marcus environmentalism threaten to trivialize the causes, nature and solutions of our environmental problems. Ultimately, we have to realize that environmental degradation is a social and not a personal problem. We can’t address climate change solely through acts of personal contrition or self-abnegation, we need to fundamentally change the rules of the game, particularly by taxing carbon, to send powerful and universal signals to everyone about how they should invest, produce and consume (or not consume) in order to have a sustainable planet.


The Week Observed, December 7, 2018

What City Observatory did for the past two weeks

Alert followers will know the City Observatory has been preoccupied for the past two weeks; we’re filling in with a “Two-Weeks Observed” edition this week, and will be back to normal editorial approach this coming week.

1. Does Cyber Monday mean Gridlock Tuesday? The rapid growth of e-commerce and package delivery has raised concerns that freight movement will choke city streets and produce gridlock. We take a careful look at these trends, and see no reason to panic. While its true that the value of e-commerce has increased three-fold in the past 9 years, urban truck traffic has risen by only about 3 percent since 2007. Another plus: the more packages delivered by carriers like UPS, Fedex and the US Postal Service, the more efficient, in terms of time and labor each delivery becomes. Finally, at least one new study confirms that on-line shopping substitutes for physical shopping trips, so that delivery trucks are likely taking shoppers’ cars off the road and may be reducing congestion.

2. Going faster doesn’t make you happier.  If you listen to traffic engineers, it seems like the overarching goal of our transportation system ought to be to move people faster. If that’s the case, you’d think that people who lived in places with higher average traffic speeds would be the happiest. But you would be wrong: it turns out, that if anything, there’s a negative correlation between self-reported satisfaction with an area’s transportation system and its average speed.  Places with faster travel are just more spread out, which means more time spent traveling, ergo, less happiness with the transportation system.

3. Our transportation rules of thumb are “all thumbs.” While it may often seem to have the trappings of quantification or professional endorsements, much of what guides decision-making in the world of transportation is largely ad hoc or out-dated rules-of-thumb. Much of the policy making for transportation is clothed in the pseudo-scientific industry standards that measure levels of service, trip generation, lane widths and parking standards. But as we point out, many of these measures are out-dated, based on flawed data or analysis, or are simply biased in favor of promoting auto-mobility over other transportation modes and competing priorities.

Must read

1. Portland plans to waste $168 million building park and ride lots.  Sightline Institute’s Michael Andersen has a detailed critique of plans to build more than 3,000 parking spaces as part of a proposed new light rail line in Portland. This represents and massive and misguided subsidy to automobile travel. It also flies in the face of Portland’s existing experience, where expensive park and ride slots are only about 65 percent full at peak hours. Rather that cater to car drivers (who will make up only about 15 percent of light rail passengers), that $168 million would be far better spent on affordable housing near the light rail line, or improvements to bike and pedestrian facilities. We’d add one other point–about the only thing not covered in Andersen’s comprehensive takedown: turning the area next to light rail into an auto-choked parking lot makes it less attractive for those who might bike or walk to a station, and also means the land used for parking–which would be an ideal site for transit-oriented development–doesn’t house anyone.

2. Some cities are more equal than others. Akron planning director Jason Segedy has another insightful commentary on the misapplication of popular national narratives to the challenges facing many of the nation’s urban centers. Contrary to popular belief, damn few poor neighborhoods are being transformed by gentrification, especially in the Rustbelt. But that doesn’t stop concerns about gentrification from being advanced even for small steps forward in the most struggling areas.  Segedy argues this is wrong-headed:

Applying national narratives about gentrification, without understanding the realities of the regional real estate market in the Rust Belt, can lead people to the erroneous conclusion that new housing, new people, or any change at all in urban neighborhoods is bad for the people who already live there.  New residential development and private reinvestment is exactly what the traditional working-class neighborhoods of the Rust Belt desperately need.

3.  Does Uber have a fatal financial flaw?  Ride-hailing giant Uber racked up yet another quarter of billion-dollar plus losses. There are critics like Hubert Horan, who make a strong case that far from being a temporary and necessary growth-inducing strategy, per-ride losses are pretty much built into the ride-hailing business model. It’s far from clear that there are economies of scale in the ride-hailing business, and there seem to be few barriers to entry.  This may mean that Uber’s investors will find it difficult to convince financial markets to pay a $100 billion or more they seem to think the company is worth–when, or perhaps if, it ever moves forward with an initial public offering.  Yves Smith of New York Magazine argues that the company may not survive the next decade.

New Knowledge

The Earned Income Tax Credit is a social policy that pays big economic dividends. So-called “welfare” programs get a bad rap in many popular discussions, and its widely assumed that income transfers are simply a deadweight loss to taxpayers. A new study by Jacob Bastian of the University of Chicago and Maggie Jones of the Census Bureau provides data that challenges that view. One of the most important income support programs is the Earned Income Tax Credit, which provides a special refundable tax break for low income households with wage earnings. Bastian and Jones find that the credit prompts additional work effort by low income households; and that additional effort and income produces tax revenues which offset 87 percent of the program’s costs.

Jacob E. Bastian∗ and Maggie R. Jones, Do EITC Expansions Pay for Themselves? Effects on Tax Revenue and Public Assistance Spending, November 30, 2018

In the News

Our critique and questions about a study claiming that the growth of ride-sharing was associated with an increased rate of road crashes was referenced by Science Magazine.

The Week Observed, December 14, 2018

What City Observatory did this week

1. Cities, Ideas and Us:  Paul Romer’s Nobel Address.  Romer, who won this year’s Nobel Prize in the Economic Sciences had some interesting things to say about cities in his address to the Royal Swedish Academy this past weekend. A key insight of his work is the observation that ideas are “non-rival” that they can be widely shared without diminishing their usefulness to any individual. That particular property of ideas both underpins the optimistic prospects for long term economic growth, but also highlights the importance of, in Romer’s words “expanding the circle of us.” Unlike a Malthusian world of fixed physical resources, the non-rival character of ideas implies that we’re better off when more of us or contributing our energy and imaginations to creating more.  That dynamic underlies the reason for cities:  we’re better off in places where there are lots of other people contributing their ideas and talents to the economy.

2. Consuming place: restaurants per capita. We offer up one indicator of how different metropolitan area’s stack up in terms of eating options, our computation and ranking of the number of restaurants per capita. Cities are not just places of production, they’re importantly places of consumption as well, and one of the most important forms of consumption is eating. We’ve tabulated the latest data from the Census Bureau, and ranked the nation’s largest metros from those with the most restaurants per capita (San Francisco) to those with the least (Riverside). See how your city stacks up.

3. A value capture toolkit. Civic assets like parks, libraries and community centers typically add value to the neighborhoods in which they are located, but also tend to struggle to find the resources to maintain or improve themselves. A new toolkit from U3 and the project Reinvigorating the Civic Commons outlines a set of policies and programs that neighborhoods and cities can use to tap at least some of the value created by these civic assets to help support their functioning, and to expand the benefits of a robust civic commons.

Must read

1. A practical response to gentrification:  build more housing.  The New York Times reports on the efforts of Brooklyn pastor A. R. Bernard to build several thousand units of affordable housing as a way for low and moderate income residents of his neighborhood to continue to afford to live there as property values rise. Bernard is proposing to turn his Brooklyn church’s parking lot into an urban village with shops, community space and about 2,100 apartments. Rather than simply objecting to new development, or hoping that things won’t change, this approach holds some promise of fighting displacement in a way that enables a community to be home to people from a wide range of incomes.

2. Why do conservatives hate cities?  The National Review’s Kevin Williamson has an interesting column asking why conservatives seem to take such great glee is denigrating the nation’s cities.  As the red/blue divide has intensified, it’s become increasingly common to heap scorn on anything that happens in urban areas. It’s an increasingly urban-dominated world, it’s not likely to be a winning strategy in the long term.

And there are still millions of Americans who want to advance and to enjoy the best things that American life has to offer, many (though by no means all) of which are to be found in the greatest abundance in American cities and in the cosmopolitan culture that America conservatives once took for granted as something of their own. What do we have to offer them? When is the last time we asked them what it is they like about Brooklyn and Austin? When is the last time we considered their personal and cultural aspirations with anything other than resentment, contempt, and outrage?

3.  3-D visualizations of urban density.  Matt Daniels has a web-based exposition on population mountains that offers some compelling 3-D images of urban density around the world.  They illustrate the spikiness of population. Here are two views of Paris, one focused on the Ile de France, and the other pulled back to show Paris in relation to London and Southern England.

New Knowledge

Gas prices and road deaths.  A new study from New Zealand explores the statistical correlation between gasoline prices and road deaths. Lower gas prices prompt more driving, which in turn leads to more crashes, injuries and deaths.  The study by Australian economists Rohan Best and Paul Burke looks at three decades worth of data for New Zealand. They find a negative relationship between fuel prices as crash deaths: a 1 percent decrease in fuel prices is associated with a 0.2 to 0.8 percent increase in deaths. They conclude that declining fuel prices probably explain about half of the increase in road deaths in New Zealand in the past few years:

How large a contribution did lower fuel prices make to the increase in New Zealand’s road death toll since 2013? The real retail fuel price decreased by approximately 23% from 2013 to 2016. If one were to apply the average fuel price elasticity of road deaths over the period May 2004–March 2017 (Table 5), this would be associated with an increase in the level of road deaths of approximately 16%. It is thus conceivable that around half of the overall increase in road deaths over the period was due to lower fuel prices.

Rohan Best & Paul J. Burke, Fuel prices and road accident outcomes in New Zealand, CAMA Working Paper 57/2018, November 2018.

In the News

City Observatory’s Joe Cortright testified to a Washington legislative committee looking at reviving the ill-fated $3 billion Columbia River Crossing project, warning them not to repeat the mistakes that caused the project to implode 5 years ago, after wasting $200 million on planning–via OPB News.

The Week Observed, December 21, 2018

What City Observatory did this week

1. The limits of Nieman Marcus environmentalism. It’s fashionable to demonstrate one’s green credibility by conspicuous acts of non-consumption, but framing our environmental problems as fundamentally those of personal or moral failures misses the point that we’ve set up a social and economic system that generates powerful incentives to pollute. The solution won’t be found in individual acts of contrition or self-abnegation, but rather in fundamental changes to laws and rules–like a carbon tax–that can achieve scale.

2. Where you can walk and buy local. We use City Observatory’s storefront index to show where there are walkable neighborhoods with mutually reinforcing clusters of customer-facing retail and service businesses in large metropolitan areas through the US. Local businesses tend to thrive, not in isolation, but when they’re located in close proximity to one-another, and where the activity associated with traveling from business to business on foot enlivens the area. This “sidewalk ballet” described by Jane Jacobs underpins the health of local business districts, something we can document visually with the Storefront Index.


Must read

1. Don Kostelec’s Twelve Days of Traffic Safety Myths. Much of the received wisdom about how to design and manage streets and roads, and how to think about safety is based on fictions that are as widespread and durable as Santa Claus. You’ll find a sharp, but well-informed debunking of claims about “Complete Streets” and “Vision Zero”–both slogans that have been watered down to near meaninglessness by highway engineers; a critique of the phony claim that 94 percent of crashes are due to human error; and perennial admonitions for pedestrians to assume “shared responsibility” for safety and done bright reflective clothing.

2. Cities are all about fighting climate change, except when it comes to long-term infrastructure decisions. The Transport Politic’s Yonah Freemark has an insightful analysis of Chicago’s plans to spend upwards of several billion dollars in the coming years to rebuild the city’s lakefront highway. In an article entitled “The politics of wishful thinking: American cities and their commitment to the expressway,” he notes that no serious thought is being given to eliminating Lakeshore Drive, even though it commits the city to decades of auto-dependent transport, makes city neighborhoods less livable, and cuts the city off from it’s signature environmental asset. Leaders like Mayor Rahm Emanuel profess fealty to the Paris Climate Accords, but when it comes to the big, expensive decisions that will shape the city for decades, almost no serious thought is given to moving away from an auto-dominated landscape.

3. How affordable housing reinforces economic and racial segregation. Chicago’s Metropolitan Planning Council has a compelling map and analysis of the location of the city’s formal affordable housing (public housing, plus units supported via housing vouchers and the Low Income Housing Tax Credit). The neighborhoods with the lowest shares of affordable housing tend to be much whiter (54 percent) and higher income (averaging $80,000 median family income or greater) than the neighobrhoods with the greatest concentrations of affordable housing (11 percent white, and average incomes of about $43,000).

New Knowledge

What’s behind rising construction costs?  BuildZoom.com’s Issi Romem has a detailed analysis of how construction costs are changing in markets across the US. There are wide differences in construction costs across markets, and the big differentiator is labor costs. Materials costs are almost identical across metropolitan areas, but the most expensive markets have the most expensive construction labor. Moreover, the situation is worsening: labor costs have been rising faster in the highest cost markets.

As Romem points out, there are several self-reinforcing cycles at work here. Markets with expensive housing are expensive to live in, and very likely require firms to offer higher levels of pay in order to be able to attraction construction workers. Another way to look at this relationship is to imagine that in supply constrained markets, labor shares some of the economic rents that would otherwise go to landowners.

In the News

Bloomberg’s Noah Smith cited our analysis of the literature on the stability of newly integrated neighborhoods in his analysis of Minneapolis decision to legalize triplexes city-wide.

Reihan Salam quoted City Observatory’s Joe Cortright in his National Review article, “Portland Housing Policy: Turning NIMBYs into YIMBYs.”

Crain’s Cleveland Business reported on our ranking of metropolitan areas by their number of restaurants per capita, in “Cleveland’s restaurant boom may be important for progress.”

Where you can walk and shop locally: The Storefront Index

Where are walkable local shopping districts in your city?

There are just six shopping days left until Christmas; while much of our shopping is done on-line or with at big box stores and national chains, many consumers look to support their local businesses during the holiday season.  Where, exactly, can you find the clusters of local shops that representative alternatives to getting malled?

Part of the answer comes from City Observatory’s Storefront Index–we’ve mapped the location of millions of customer-facing retail and service businesses in cities throughout the nation, with an emphasis on identifying clusters of businesses in close proximity to one another–where you could conceivably walk from one establishment to another (or several others).  One great feature of the Storefront Index is that it shows the pattern and density of retail activity throughout a metropolitan area.

Our Storefront Index includes a series of maps, available for the nation’s 51 largest metropolitan areas, that show the location, size, and intensity of neighborhood business clusters down to the street level. Here’s an example for Portland, Oregon. On this map, each dot represents one storefront business. This maps shows storefront businesses throughout the metropolitan area. In downtown Portland, there is a high concentration of storefronts; as one moves further out towards the suburbs, the number of storefronts diminishes, and storefronts are increasingly found arrayed only along major arterials.


A key message of the index is that retail businesses, especially small, local ones, don’t do well in isolation.  They thrive when they’re part of an environment that combines public spaces and private establishments in a dense, and mutually reinforcing array. A local book store, like Portland’s Broadway Books, is more likely to flourish if its located–as it is, near to restaurants, coffee shops, bakeries, florists, and other establishments that generate foot traffic and create a lively and enjoyable place to walk.


Broadway Books is located in one of these thriving l neighborhood business districts: Northeast Broadway.  We can use the Storefront Index map to zoom in to the local area to see the array of businesses lined up along both sides of the street, a walkable string of pearls for shoppers.

As Jane Jacobs so eloquently described it in The Death and Life of American Cities, much of the essence of urban living is reflected in the “sidewalk ballet” of people going about their daily errands, wandering along the margins of public spaces (streets, sidewalks, parks and squares) and in and out of quasi-private spaces (stores, salons, bars, boutiques, bars and restaurants). These urban street spaces are especially active this time of year, when the usual flow of customers is swelled by holiday shoppers. 

You can use the Storefront Index to zoom in to any neighborhood in any of of the fifty largest metropolitan areas in the US; it will show you which places have a diverse array of storefronts in close proximity to one another, and which places have a paucity of such concentrations.


Maps of the Storefront Index for the nation’s 51 largest metropolitan areas are available online here. You can drill down to specific neighborhoods to examine the pattern of commercial clustering at the street level.

We also use the Storefront Index to track change over time, looking at the growth of businesses and street level activity in a rebounding neighborhood in Portland. There’s also strong evidence to suggest that concentrations of storefront businesses provide a conducive environment for walking. We’ve overlaid the storefront index clusters on a heat map of Walk Scores for selected metropolitan areas to explore the relationship between these two measures. While Walk Score includes destinations like parks and schools, as well as businesses, it also measures walkability from the standpoint of home-based origins, while our Storefront Index shows the concentration of commercial destinations.

City Observatory has developed the Storefront Index as a freely available tool for urbanists and city planners to use in their communities. The index material is licensed under a Creative Commons Attribution license (as is all City Observatory material), and a shape file containing storefront index information is available here.

When planning rules of thumb are “all thumbs”

Some commonly used “rules of thumb” produce very bad results 

We all know and use rules of thumb. They’re handy for simplifying otherwise difficult problems and quickly making reasonably prudent decisions. We know that we should measure twice and cut once, that a stitch in time saves nine, and that we should allow a little extra following distance when the roads are slick.

What purport to be “standards” in the worlds of transportation and land use are in many cases just elaborate rules of thumb. And while they might have made sense in some limited or original context, the cumulative effect of these rules is that we have a transportation system which is by regulation, practice, and received wisdom, “all thumbs.”

How we feel about bad rules of thumb. Get it? Credit: Jesper Ronn-Jensen, Flickr.
How we feel about bad rules of thumb. Get it? Credit: Jesper Ronn-Jensen, Flickr.


One of the problems with rules of thumb (or the more academic term, “heuristics”) is that while they may work well in many cases, they may work very poorly in others – and they may be subject to important cognitive biases that lead us to make bad decisions.

Here are five rules of thumb that have led to a distorted view of our transportation problems and their appropriate solutions.

Old rule of thumb #1: We should have a high “level of service” on our streets. Around the country, traffic engineers have long assigned one of six letter grades A through F to describe traffic flow on streets. (A is free-flowing traffic, F is highly congested.) Many planning decisions emphasize the need to maintain high levels of service, which means that roads are designed to be much bigger (and more expensive) than they need to be most of the time. And level of service only measures car travel time on a particular road, ignoring non-car travelers, and – importantly – the effect of more roads on sprawl and overall trip lengths. These flaws have lead California to eliminate level of service as a factor in environmental analyses of traffic impacts.

Old rule of thumb #2: Wider streets are safer streets. It’s long been an engineering axiom that wider roads are safer, because they give cars and others more space to avoid collisions. But the behavioral effects of wider roads overwhelm the supposed safety advantages. Wider lanes encourage vehicles to drive faster, and higher speeds produce deadlier consequences—especially for cyclists and pedestrians. New research shows that the optimal lane width for minimizing crashes and injuries is something like 10 or 11 feet, not the 12-14 feet of many travel lanes in streets around the country.

The wider the lanes, the easier it is to speed. Credit: Pier-Luc Bergeron, Flickr.
The wider the lanes, the easier it is to speed. Credit: Pier-Luc Bergeron, Flickr.


Old rule of thumb #3: We should require “enough” off-street parking for every use. As Donald Shoup has shown, parking requirements spelled out in zoning codes—often based on formidably inaccurate estimates prepared by the ITE (Institute of Traffic Engineers) lead to a situation where every business’s parking lot is sized for the peak hour of the peak day of the year (holiday shopping season at the Mall, example). Not only does this produce more parking than is needed the rest of the year, it turns out that parking “requirements” grossly overstate demand even in peak periods, and especially for urban uses where more people arrive by other means, and park for shorter periods of time. The product of this rule of thumb is that parking is over-supplied, destinations are further apart than they would otherwise be, and walking, transit and cycling are non –functional.

Old rule of thumb #4: We should plan for a certain number of car trips to be generated by every land use, no matter where it is. Another rule of thumb for planning is that every land use “creates” or generates a certain number of trips. But it isn’t necessarily so: the studies used to make these esimates are drawn from large-scale suburban development where proportionately more trips are by auto. A careful analysis of the data shows that trip generation estimates for most uses are overstated by a factor of 2, leading local governments to require even more transportation capacity than is needed—driving up development costs, and inducing additional travel.

Old rule of thumb #5: We should have a hierarchy of streets. The street hierarchy makes an explicit analogy to the human circulatory system. Just as we have an increasingly fine array of arteries, veins and capillaries, so too does the transportation system have freeways, arterials, collectors and local streets. And we’ve abandoned the traditional street grid for a dendritic pattern. It turns out that these hierarchical street systems are less resilient to disruption and have less capacity than the old-fashioned grids they replace, and are especially hostile to non-automotive modes of travel (pedestrians and bikes are forced to take circuitous routes and are hard to accommodate at the intersections of major arterials that have limited “green” time to accommodate cross=traffic and turning movements. The hierarchal system of “arterials, collectors, and local roads that we’ve adopted in place of the traditional street grid has had the effect of making the average trip between any two points longer. Over the past two decades the “circuity” of trips has increased by 3.7 percent in the nation’s 50 largest metropolitan areas. This increase is on top of the increase in trip distance due to sprawl and decentralization.


Our “all thumbs” approach to transportation planning leads to a specific pattern of development that is as inefficient for cars as it is hostile for persons traveling on foot, via bicycle and on transit.

What is needed are a new set of rules of thumb. Like all heuristics, this isn’t meant to be taken as a final set of “standards” to fit every situation – but there are some emerging ideas about what we might emphasize.

New rule of thumb #1: Closer is better. Having more different destinations close at hand facilitates a wide range of mode choices, especially walking and cycling. Mixing uses, which is often anathema under traditional zoning codes turns out to be desirable for consumers and expeditious for transportation.

New rule of thumb #2: Slower is safer. When cars and people on foot and on bikes interact, safety comes from slow speeds even more than separation. Local streets that move traffic slowly are friendlier—and safer—for non-auto modes of transportation.

Source: NYC DOT, Flickr.


New rule of thumb #3: Sharing is efficient. Rather than require every use to provide parking for the peak hour of the year, arranging uses so people can park once, and walk mostly leads to less traffic, greater safety and more congenial, fine-grained development patterns.

New rule of thumb #4: Our objective should be accessibility, not mobility. Many transportation heuristics emphasize speed: how do we make things move faster. But what we really care about is getting to (or being at) our destinations, not rapidly traveling among them. Speed should be secondary to choice.

Of course, these new “rules of thumb” are just a beginning. There’s a lot of work to be done to un-learn and re-think the unfortunate heuristics we’ve employed in thinking about transportation planning and land use. But as these examples illustrate, re-thinking these issues isn’t a purely technical matter: it depends critically on re-imagining the way we visualize and tell stories about how our transportation system works.

Consuming the city: Ranking restaurants per capita

The number of eating places per capita is a key measure of a city’s livability

Cities are great places for consumers.  They provide an abundance and variety of choices, especially in the form of experiences. While our conventional economic indicators don’t fully capture the nature and depth of choices in cities, there are some measures that shed light on which places offer the most.  Today we offer our index of restaurants per capita as one such indicator of where choice is greatest.

There are plenty of competing rankings for best food cities floating around the internet. You can find lists for cities with the most restaurants, the best restaurants, the most distinctive local restaurants… and of course none of these seem to agree (although the “winners” tend to be similar among these lists).

But what about the cities that provide the most dining options per person? And what does restaurant variety have to do with a city’s livability?

One of the hallmarks of a great city is a smorgasbord of great places to eat. Cities offer a wide variety of choices of what, where, and how to eat, everything from grabbing a dollar taco to seven courses of artisanally curated locally raised products (not to mention pedigreed chickens). The “food scene” is an important component of the urban experience.

Restaurants are an important marker of the amenities that characterize attractive urban environments. Ed Glaeser and his colleagues found that “Cities with more restaurant and live performance theaters per capita have grown more quickly over the past 20 years both in the U.S. and in France.”

Matthew Holian and Matthew Kahn have seen that an increase in the number of restaurants per capita in a downtown area has a statistically significant effect in reducing driving and lowering greenhouse gas production. We’ve assembled data on the number of restaurants per capita in each of the nation’s largest metropolitan areas. These data are from the County Business Patterns data compiled by the US Census Bureau for 2012. Note that this category, technically NAICS 72251, includes both sit down, table service restaurants and simpler fast food and self-service self-service establishments. We’re also looking at metro-wide data to assure that the geographical units we’re comparing are defined in a similar fashion—political boundaries like city limits and county lines are arbitrary and vary widely from place to place, making them a poor basis for constructing this kind of comparison.

As you might guess, the metro areas with the most restaurants per capita are found predominantly in the Northeast and on the West Coast. Elsewhere, New Orleans scores high as well. While the average metropolitan area has about 17 restaurants per 10,000 residents, the range is considerable. The San Francisco metropolitan area has more than 23 restaurants per 10,000, while Riverside and Grand Rapids have only about 14 per 10,000. (On this map areas shaded green have the highest number of restaurants per capita; areas shaded red have the fewest. Detailed data on individual metropolitan areas is shown in the table below).

The top six metropolitan areas on this indicator are San Francisco, New York, Providence, Boston, Seattle and Portland. Each of these cities has twenty or more  restaurants per 10,000 population. With the possible exception of Providence, all of these are recognized as major food cities in the US. (And Portland achieves its high ranking without counting the city’s more than 500 licensed food carts.)

In an important sense, the number of different restaurants in an area correlates to the range choices available to consumers. Cities that have more restaurants per capita tend to have larger restaurants (measured by the average number of employees per restaurant).  Interestingly, Las Vegas, which we think of as a tourism mecca, has fewer restaurants per capita than the average metropolitan area. A lot of this has to do with scale—the average restaurant in Las Vegas tends to be much larger than in other metropolitan areas.

This ranking doesn’t include anything about quality–simply quantity–but the higher restaurants per capita can indicate higher competition (and therefore better quality options), or higher demand (a signal that more diversity of options is valued, allowing for more valuable experiences).

While this isn’t a perfect listing of best food culture — each person’s measure of the ‘best food town’ is subjective — it does settle the debate of where you should go to have the largest selection of eatery options.