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Memorial Day Light Read 2023

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For this week’s Present Value post, we’re filling you in on Memorial Day happenings in Philly and catching you up on the latest from ESI.

Happy Memorial Day from all of us at ESI!

 

Events and Activities Around Philly

Things to Do in Greater Philadelphia for Memorial Day Weekend 2023
Visit Philadelphia

Free Admission at the National Constitution Center from May 27 – 29, 2023
The National Constitution Center

Celebrate the start of summer at Spruce Street Harbor Park or visit the Summerfest RiverRink
Delaware River Waterfront Corporation

Parks on Tap takes over Clark Park from May 24 – 29, 2023
Parks on Tap

12th Annual Philadelphia Latino Film Festival runs from May 28 – July 9
Philadelphia Latino Film Festival

The Latest from Present Value

Congestion Pricing in New York: How Will it Work?
By Sam Sklar, Director

Discussing the Future of Cities with Gina Lavery
By Mike Daly, Business Development Manager

How Can we Convince the Public that a College Degree is Still Worth it?
By Dr. Elmore Alexander, Senior Advisor

Can your Downtown Benefit from Office Conversions?
By Dr. David Stanek, Director

The Philly Tree Plan: Sowing the Seeds of a Greener, More Sustainable City
By Melissa Wright, Associate Director

ICYMI: Critical Issues Facing Higher Education

In April and May of 2023, ESI presented a series of weekly webinars addressing critical issues facing the higher education sector. Below are links to each of the recorded sessions.

Anchoring Innovation Ecosystems, featuring Bernadine Hawes
Runtime: 28 minutes

Supplier Diversity on Campus, featuring Angela Dowd-Burton
Runtime: 25 minutes

HBCUs in Economic Development, featuring Dr. Jamie Green and Dr. Joseph Whittaker
Runtime: 30 minutes

Chinese Students in American Institutions – Past, Present, and Future, featuring Dr. Benjamin Olshin
Runtime: 26 minutes

Organizational Leadership in Uncertain Times, featuring Dr. Curtis Gregory
Runtime: 29 minutes

Sustainability, featuring Robert Fleming and Raymond Barclay
Runtime: 30 minutes

The Bottom-line Case for Energy Efficiency, featuring Dan Garofalo
Runtime: 29 minutes

In the News

The New Exhibit at Philly’s Historic Germantown Looks at Race and Class Through the Ground-breaking 1946 Children’s Book ‘Bright April’
By Valerie Russ, The Philadelphia Inquirer

Wilmington’s Grand Prix Returns for its 15th Year this Weekend
By Johnny Perez-Gonzalez, WHYY

List Extra: Greater Philadelphia’s Top Tourist Attractions Brought in More than 20M Visitors in 2022
By Todd Romero, Philadelphia Business Journal

Liberty Bell, Longwood Gardens Among Destinations Awarded Michelin Stars in New Philadelphia Guidebook
By Emma Dooling, Philadelphia Business Journal

Hybrid Work is Here to Stay. These Philly Business Leaders say ‘We Should Stop Complaining’
By Lizzy McLellan Ravitch, The Philadelphia Inquirer

Public Transit Gets the Swiftie Bump
By Diana Ionescu, Planetizen

Congestion Pricing in New York: How Will It Work?

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In April 2023, USDOT released the result of its environmental assessment of New York City’s proposed “Central Business Tolling” project—known more colloquially as “congestion pricing”—after years of examination and review. The result—a “Finding of No Significant Impact” or FONSI—means that the MTA can continue its process to implement a program to toll drivers for entering Manhattan below 60th St.

It’s supposed to have a monumental effect on travel and transportation throughout the New York Metropolitan region, and notably the program aims to accomplish two goals: fewer motor vehicles in Lower Manhattan and fewer motor vehicles traveling below 60th St., from River to River, and more dedicated money for the MTA, which is responsible for running transit and regional rail throughout New York and Connecticut.

Source: https://rpa.org/work/reports/congestion-pricing-in-nyc

 

How Will the Program Work?

The program would work similarly to this, and the final details are not yet finalized, but:

Motor vehicles that would enter Manhattan from the north, or by a connecting bridge or tunnel, would be subject to a fee—a toll of between $5 and $23—to enter the zone outlined in orange above, based on several factors, including time of day and consideration for freight vehicles, residents who live within the tolling zone, and low-income drivers.  More information can be found here, including over 29,000 pages of comments from concerned observers. The gist is that, if successful, New York City can be the first North American city to follow in the footsteps of London, Stockholm, Milan, and Singapore as cities around the world to successfully implement a charge.

What are the Program’s Goals?

According to the FONSI, the Tolling Program’s expected goals are as follows:

  • Reduce daily vehicle-miles traveled (VMT) within the Manhattan Central Business District (CBD) by at least 5 percent.
  • Reduce the number of vehicles entering the Manhattan CBD daily by at least 10 percent.
  • Create a funding source for capital improvements and generate sufficient annual net revenues to fund $15 billion for capital projects for the MTA Capital Program.
  • Establish a tolling program consistent with the purposes underlying the New York State legislation entitled the MTA Reform and Traffic Mobility Act.

The major goal is mode shift. The structure of the Tolling Program’s pricing mechanism is both incentives to take other means into and out of Lower Manhattan and deterrent for driving into one of the most congested business districts in the world. MTA would dedicate the collected revenue to fund nearly one-third ($15 billion over five years) of its plan to build more transit and make sure there are adequate and attractive options for regional travel.

How Do We Measure Congestion Pricing’s Success?

There are three important factors: what we choose to measure, how we choose to measure it, and how we interpret the results. Generally, the mechanism to compare how a project might perform is a benefit-cost analysis (BCA). The idea is relatively simple. A team of interested folks gathers a list of quantifiable benefits, which often include, but are not limited to:

  • Travel time savings: how will a reduction in congestion contribute to faster travel times for remaining drivers. How will this redistribution help save commuters who switched to another mode, too?
  • Reduced car crashes: the fewer the number of traveling vehicles, the lower the likelihood for incident.
  • Reduced noise benefits: fewer cars means potentially less noise.
  • Increased environmental benefits: directly related to both air pollution from car exhaust and particulate matter pollution from the paved asphalt.

A BCA’s execution can be wickedly complex to calculate and interpret correctly. How does the team estimate the number of motor vehicles that currently enter the area? How do they estimate the difference once the policy is put in place? Whose time are we measuring?

The goal is to quantify the benefits, extend them out to some point in the future—usually 30 years or more—and compare these benefits to the total cost of implementing the project.[1] This output is called a benefit-cost ratio (BCR) and is relatively easily interpretable in any context. If the BCR is more than 1, the benefits outweigh the costs, and if it’s less than 1, then the opposite is true. By itself a benefit-cost ratio is not a decision-making tool, but it can be used to compare the relative merit of two projects, or two alternatives for the same project. The team can seek to change inputs, like how much it charges to enter the congestion zone, and compare the outputs to optimize pricing, for instance.

Are There Other Places in the United States Ready for a Congestion Pricing/Tolling Program?

It is way too soon to tell. The program hasn’t been implemented in New York City yet, but it has been successful in other parts of the world—especially Singapore, which piloted a program in the mid-1970s and continues to faregate access to certain parts of its city to motor vehicles. It’s also been implemented in Northern and Southern Europe—London, Stockholm, Milan. In all transportation planning projects, context is king, so simply because one projects works in one place doesn’t mean it will work in any other place without considering a few factors, which include:

Historical Context. Has a program like congestion pricing been tried before? Was it successful? What’s driving this project here and now? What are the conditions of the place that might contribute to success?

Geography. What does the city/region physically look like? What would the congestion boundary look like. For example, London is a radial city—its boroughs spread from a central location and the congestion “zone” is somewhat circular. New York, however, is not. There was a conscious choice to limit the boundary to 60th Street and below, and to have it only cover Lower Manhattan, for now.

Political Will. This is potentially the biggest challenge for congestion pricing—telling the right story to the right stakeholders to understand what the tolling authority/agency wants to achieve is key. The coalition of politicians, riders, nonprofits, transit agency staff can make or break a successful program and it takes a champion and the ability to change minds to get a project this big and complex off the ground.

Let’s follow New York City closely as an exemplar and learn from its process. Other transit-starved cities and regions are looking closely.

 

[1] The BCA will seek to calculate the present values of costs and benefits, which simply considers inflation and the economic idea that a dollar today is worth some amount more than a dollar tomorrow, the next day, or next year.

 

Sam Sklar, Director | Sklar@econsultsolutions.com

Sam Sklar is a director with Econsult Solutions, Inc. (ESI). Mr. Sklar has extensive experience in program and project management, planning, and analysis. As an effective communicator, Mr. Sklar has special expertise in many forms of communications strategies. In addition to his duties at ESI, he publishes a growing newsletter, Exasperated Infrastructures, which covers state and federal infrastructure policy.

 

Parking Wars

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We can no longer stay neutral; reasonable solutions must start to drive our decision making

A woman walks into a restaurant to meet a group of friends. She proceeds to apologize for being late but explains she was looking for parking for the past 20 minutes. This sparked a vibrant discussion that opened their evening. Parking wars is a hot topic in urban environments, with some believing that the world should go to zero car dependency (or somewhere close), others believing owning a car is a right and privilege and have no intention of giving it up, and a lot of opinions and concerns in between.

It’s important to acknowledge the history and complexity of this topic. Owning a car has been built into the fabric of society in America. To the point where if someone tells you they just bought a car, the typical response is “congratulations.” A nod to achieving a piece of the “American Dream,” that includes car ownership. However, vehicle traffic has also contributed to quality-of-life issues including climate change that has a variety of health impacts, traffic congestion and pollution.

To further complicate the matter, parking has become a sufficient source of revenue for cities. Parking provides jobs and tax income that if reduced or eliminated, without thoughtful replacement, could place a strain on City budgets. In Philadelphia, the Philadelphia Parking Authority in 2022 had $275 M in revenue of which $73 M (26%) went to the city of Philadelphia, $18 M (7%) to the Philadelphia School District, and $36 M (13%) went to the PA Department of Transportation. If the City was to wave a magic wand today and grant all the wishes of those advocating to rid the city of cars, the city’s budget would be in peril. It is crucial to account for the lost revenue of important items such as education and the mass transportation infrastructure when considering alternate solutions.

Parking has also become synonymous with terms such as gentrification. Over the past 15 plus years, we have seen a return of urban living that has resulted in residential and commercial development changing the look and feel of neighborhoods. In Philadelphia, one of the most notable projects is the potential building of 76ers arena in Center City. One of the more public backlashes from the stadium is, “Where will I park? Parking and access to the venue will be an absolute nightmare.” However, layered in that is a divisiveness between communities who are opposed to or in favor of the stadium. Complaints about parking has become a way for communities to voice their discontent with changes occurring in neighborhoods.

Approach to Solutions

Reasonable solutions to this complex problem cannot stem from forcing one side to heed to other’s demands. We have to take a more innovative approach that looks at the long-term goals that are implemented in phases, even if the implementation happens over decades.

New Thinking About Parking

Due to the built environment and the long road towards change, vehicles are here to stay for the foreseeable future. MIT professor Eran Ben-Joseph estimates there are 800 million surface parking spaces in the US. This translates into eight available parking spaces for every passenger car. It is projected that by the year 2060, 460 million people will live in the US. (Long, 2014). Following our current trajectory, an increase in population translates into an increase in car ownership. However, this should further incentivize cities to design and manage parking infrastructure in much more efficient ways.

One solution is to help people “rethink” how they think about parking. This can happen through mass transit organizations creating marketing campaigns for people to “Give Us a Try,” persuading current drivers to try mass transit. Another option is motivating people to park once in cities if they are going to multiple locations, incentivizing them with reduced fares for short transit and shared mobility trips to move through various locations.

Emphasize Shared Mobility

Shared mobility, including traditional public transportation, rental, and taxi services is here to stay. But also includes new modes, such as ridesharing with strangers, peer-to-peer car sharing, and shared electric scooters and bikes, pointing to a sizable potential market in the mobility space. In 2019, shared mobility revenues reached 130 billion. By 2030, total revenues are expected to reach between $450 and $860 billion for shared mobility industries. (Heinke, Kloss, Moller, & and Wiemuth, 2023).

The next big innovations in shared mobility include autonomous taxis (robo-taxis) and airborne variants, which have seen a huge acceleration in investment and traction in recent months. There is a range of public and private partnership investments that can help scale accessibility to current and future modalities, helping to ease congestion of parking while providing options for more sustainable living.

Next Steps

As long as people own cars, there will be discussions and arguments on where to store them. While some people will focus on the far ends of each debate. The actual solution will likely end up somewhere in the middle, with more incentives to use shared mobility and public transportation, without completely eliminating the use of cars. Cities are denser areas, where space is a hot commodity, and there are more communities’ interests to balance. The use of cars, parking, and the topic of mobility in cities will continue to evolve as society shifts to the needs of the population.

 

Frank RobinsonFrank Robinson | Robinson@econsultsolutions.com 

Frank Robinson is a vice president with Econsult Solutions, Inc. Mr. Robinson has been a leader in the economic development and sustainable development industries for over 20 years, working with corporate, government and nonprofit clients, banks and credit unions, as well as community development financial institutions (CDFI) and small businesses.

Can your Downtown Benefit from Office Conversions?

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Many cities across the United States are faced with two enduring impacts of the COVID-19 pandemic: vacant office space in their central business districts and a high demand for housing. Many cities across the country, including New York City, San Francisco, Boston, and Atlanta, have adopted or are considering policies to encourage the conversion of offices to residential buildings in their commercial districts.

ESI recently supported New York City’s Office Adaptive Reuse Task Force in developing a report that included a set of recommendations tailored to New York’s unique situation. Here are four lessons we learned from that work that may help you consider whether or not your city should adopt a policy to encourage office conversions.

Know your regulations

There are dozens of hurdles that will prevent an office building from being converted to a residential property—physical design, financing, risk, market conditions, future expectations—but none of them matter if existing land use regulations or building codes don’t allow conversions. Municipal zoning regulations are most likely to affect conversions, but state-level building, health, or safety regulations may also limit the ability of property owners to convert their buildings.

In New York City, there are large sections of Manhattan in which office conversions are either illegal or must meet a series of requirements that make conversions all but impossible. In other parts of Manhattan, office buildings built before 1979 may convert under a set of more lenient regulations than buildings in other areas. The Office Conversion Task Force made several recommendations to harmonize and loosen regulations governing conversions.

Vacancy rates will not dictate conversions

Owners will. When we first started looking at the New York City office market and talking with industry experts, it became clear that there was a subset of buildings in the office market that stood little to no chance of attracting new tenants in a post-COVID landscape. We heard over and over about a sustained “flight to quality,” in which tenants were signing leases for smaller floor area in more amenity rich buildings closer to major transportation hubs.

Landlords with high quality space in desirable locations were happy to oblige the shift, leaving landlords with lower-quality space in secondary locations with excess space. We saw buildings that were 30, 40 and sometimes more than 50 percent vacant with little immediate hope of attracting new tenants. What perfect conversion candidates!

However, most of these buildings are unlikely to convert. Why? Most property owners don’t have the experience to convert a building from one use to another. The risks of trying were too great. Many property owners aren’t willing to sell the building at a loss and would rather wait and see if the market returns. Or they had such favorable terms on loans signed before the pandemic that selling and buying back into the market at higher interest rates made little long-term sense.

Some buildings are more suitable to conversion than others, but most physical constraints can be overcome if someone is willing to pay

The office stock in any given city is a historical record of building materials, techniques, styles, preferences, and space requirements. In New York City, most successful office-to-residential conversions had three common characteristics: they were built before 1940 and had comparatively small floor plates and operable windows. In the 1950s and 60s, businesses demanded open floor plans and innovations in building technologies allowed for ever larger floorplates that continued to expand in subsequent decades.

Modern buildings do present a series of physical design challenges than older buildings, but architects are clever. In conversations with several designers with experience converting offices to residential buildings in New York City, it was clear that there is a design solution to nearly every physical challenge an office building can present. Curtain walls can be replaced to create windows that can open and close. Elevator banks can be moved or removed. Stairs can be installed. Cores can be cut out of the center of a building with large floorplates to allow air and light to reach the interior. Additional floors can be built on top of a building with structural reinforcement. But with every major shift in a building’s design, the costs of conversion goes up, and as those costs go up, property owners and developers will be looking to city governments for incentives.

Office-to-residential conversion is a niche practice, which means financing can be a challenge

Developers in the real estate industry tend to specialize in one building type, for example, high end commercial, low-income housing, large-format retail, or entertainment complexes. This specialization allows developers to deliver buildings with greater efficiency and lower costs. However, most practitioners don’t have experience converting one building type to another, and without a strong track record of success in a given market, lenders may be unwilling to finance conversions.

Office to residential conversions make good urban planning sense. With the right zoning regulations, tax incentives, and financing options, office-to-residential conversions can help meet the demand for housing, help remove excess vacancy from office markets, and bring more foot traffic to neighborhoods that have been struggling since the pandemic began three years ago. However, unless heavily incentivized, office conversions are likely to remain relatively uncommon.

If you are interested in learning more about commercial to residential adaptive reuse, you can contact us here, or read the New York City Adaptive Reuse Task Force Report here.

 

David Stanek | Stanek@econsultsolutions.com

David Stanek, Ph.D., a director at ESI, is an urban planner who specializes in combining data science techniques, geographic information systems, and qualitative research methods to evaluate the role and influence of land use and preservation interventions on residents, places, and municipal budgets. Prior to joining the firm, he was a land use and zoning researcher at the Penn Institute for Urban Research. He has taught land use, urban policy, and public finance at Rutgers University and Hunter College and has consulted on projects for a variety of clients including the World Monuments Fund, Arup, the William Penn Foundation, Ford Foundation, USAID, the Urban Institute, and WSP as well as several municipal governments.

 

The Philly Tree Plan: Sowing the Seeds of a Greener, More Sustainable City

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As cities around the world grapple with the challenges of urbanization, many are turning to nature-based solutions to create more livable, sustainable communities. Here in Philadelphia, the city has taken an ambitious step forward with the Philly Tree Plan, an initiative aimed at increasing the city’s tree canopy cover and enhancing the benefits that trees provide to residents and the environment.

Launched in 2020, the Philly Tree Plan sets out to increase tree canopy in the city to 30% by 2030. This increase in tree coverage is expected to bring a wide range of benefits, including improved air and water quality, reduced stormwater runoff, and a reduction in the urban heat island effect. ESI quantified these benefits and here is what we found:

 

Achieving the desired tree canopy goal is no small feat. It requires a coordinated effort from city officials, community organizations, and residents to plant, care for, and maintain the forestry that will form the backbone of a more sustainable city. To this end, the Philly Tree Plan includes a range of strategies to make tree planting and maintenance a citywide priority. One approach is to work with community organizations and volunteers to plant and care for trees in public spaces, such as parks, streets, and sidewalks. By engaging with local residents and community groups, the city can tap into the expertise and passion of those who are most invested in the health and well-being of their neighborhoods.

In addition, the Philly Tree Plan offers incentives for property owners to plant and care for trees on their land. This not only helps to expand the city’s tree canopy coverage but empowers residents to take an active role in creating a more environmentally-focused, livable city. Finally, the Philly Tree Plan seeks to integrate tree planting and maintenance into city planning and development projects. By prioritizing trees as a key component of urban infrastructure, the city can ensure that they are a central part of the city’s growth and development, not an afterthought.

The tens of thousands of jobs created by the Philly Tree Plan would include numerous potential employment opportunities for workers with less than a bachelor’s degree. These workers would be eligible for various direct employment opportunities related to the Plan, including numerous public-sector tree care and customer service positions. In addition, contracting work associated with the Plan could be used to support new or existing Minority, Woman, or Disabled-Owned Business Enterprises (MWDSBEs) in Philadelphia. This is a critically important opportunity in a majority-minority city where diversity, equity, and inclusion in the private sector is a core concern.

The Philly Tree Plan represents a bold, forward-thinking approach to urban sustainability that puts nature at the center of city planning and development. By sowing the seeds of a greener, more sustainable city, Philadelphia is creating a brighter future for all of its residents.

 

Melissa Wright, Associate Director

Melissa is a former director at ESI. Prior to her time at the firm, she worked for Teach for America as the Director of Performance Measurement and Evaluation. Ms. Wright currently serves as Senior Director for Data and Policy with The City of Philadelphia Commerce Department’s Office of Economic Opportunity.

 

Linking Transportation and Land Use

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The planning profession often has to look ahead, to see the bigger picture, and help connect people to their destination. One principle that helps achieve this is linkage between land use and transportation. This is vital for organizing at the neighborhood, community, county, and regional scales. Transportation services and infrastructure can impact land use patterns, quality of life of an area, and the overall economic trajectory of a region.

Before going too far in describing how this principle can be applied, it is important to define three components:

Land use – The fundamental setting and context for determining application of the land use/transportation linkage principle. Are you dealing with a local neighborhood issue or something at a higher scale that may involve more agencies to consult or review a proposed solution? Are you in a semi-rural area or a dense urban setting? Both the primary project and the associated benefits may be affected.

Transportation – The key determinant that may involve greater review and comment, depending on the mode (highway, transit, vans, bicycles, etc.), scope of the project, the jurisdiction(s) involved and the level of community outreach and information required. Sometimes, however, a controversial proposal may create a level of public interaction that is beyond the initial physical scale of a project.

Linkage – The key ingredient for the principle to work as designed, in order to yield multiple benefits. Linkage can include physical connections, improved accessibility, coordination, and integration. Recognition by participants that these outcomes are important is needed to yield both direct and indirect benefits. Linkage works two ways: the project affects the geographic area, and the geographic area will affect the project. An open and participatory involvement process typically helps to keep all participants informed and maintaining a stake in the outcome.

All professions have various qualifications, standards, and principles that reflect their values and approaches to the issues that they address on a daily routine. These standards are intended to frame ethics and core education and practice requirements to ensure a fundamental level of attainment for practitioners and academics engaged.

Applying the principle

Conceptually, two examples come to mind which demonstrate how linkage can work. One way is through transit-oriented development (TOD), involving a rail or transit line, including busses. In legislation and in local ordinances, TOD usually involves development within a quarter to a half mile radius around a station. This compact area is intended to facilitate use of transit, including walking, handicap access and close-in parking for driver access. Accessibility to the station and transit platforms is also critical. If the new or existing development does not provide effective accessibility, then the result will become transit adjacent development (TAD) rather than TOD. The TOD area can also be used to provide development bonuses for locating there, as well as a rationale for financing mechanisms to capture a portion of the value of new investments to derive funds for other municipal projects. In Pennsylvania, the Transit Revitalization Investment Act (TRID) is intended to support the creation of TODs and the simultaneous funding approach for other investments.

Another way to showcase linkage is through interchange area districts involving cooperating developers, office parks, and shopping centers to create an incentive for locating around the interchange and a financing approach for needed public improvements to benefit both the community and the participants. Here in the Greater Philadelphia region, PennDOT has been an active partner with Business Improvement Districts (BIDs) in Chester (Rt.29 and 202) and Montgomery counties (King of Prussia/Upper Merion) have been successful in such approaches, including working with local Transportation System Management Agencies (TMAs) for supplemental van services in coordination with SEPTA where possible.

How we can help

Land use and transportation linkage works and is available for use in a variety of settings beyond the two instances that I have described. Now is a particularly critical time to identify opportunities to leverage this principle. Understanding how transit adds value to development projects and determining how it can support broader community goals and objectives is crucial for long-term success. Situations like TOD investment will play a significant role in the years to come because of the American Jobs Plan providing significant federal investment across the United States. ESI combines economic, strategic, and analytics capabilities to help clients navigate an ever-changing environment and achieve these types of objectives. Likewise, thoughtful engagement with decision-makers, stakeholders, and the public provides the foundation for sound planning, successful projects, and better communities.

 

Richard Bickel | Bickel@econsultsolutions.com

Richard Bickel is a member of ESI’s Senior Advisory Board. He has been a practicing professional planner for more than 43 years. Richard has been active in the American Planning Association, American Institute of Certified Planners, and Transportation Research Board throughout his career. He currently serves on the Legislative Committee of the Pennsylvania Chapter of APA and was President of the Eastern Pennsylvania Chapter of the APA, one of the forerunners of the current statewide chapter, and a member of the national Legislative and Policy Committee and a site visitor for the Planning Accreditation Board.