The Metropolitan Council sees economic storm clouds on the Twin Cities’ horizon. We are in danger of losing jobs and creative young professionals to more enlightened metro areas, like Portland and Seattle, the council warns.
Its proposed solution? “Thrive MSP 2040”— the council’s new 30-year comprehensive plan for development in our seven-county region. The council has released a draft for public comment and will vote on the plan in May.
In fact, Thrive will likely do the opposite of what the council promises. It will raise our cost of living, lower our quality of life, and drive people and jobs to less-regulated regions, like Atlanta and Houston, which are already growing much faster than the Twin Cities.
Thrive MSP 2040 will give the unelected Met Council the green light to play “Sim City” with the lives of Twin Cities residents. Its unprecedented, top-down controls will transform many neighborhoods; push us increasingly into “stack and pack” high-density housing, and reorganize our region around mass transit. The plan will pour huge sums into light rail, increase congestion, and limit parking to push us to give up our cars and take public transit, walk or bike to work and leisure activities.
Intrusive, expensive change imposed from on high by unelected bureaucrats is a tough sell in a democracy in which people believe they have a right to govern their own towns with their neighbors. Perhaps that’s why the council and its allies are framing this power grab as the price the Twin Cities region must pay to remain “economically competitive” with peer regions. We’re all in favor of prosperity, right?
Thrive’s premise is that in the future, social planning by supersmart unelected bureaucrats will be the key to economic growth. But the facts on the ground tell a different story.
One of the best measures of a region’s economic vitality is domestic migration: the number of people who move there from other parts of the country vs. the number who leave. People don’t move to a metro area for light rail. They move for opportunity.
Which metro areas are attracting people today, and which are not?
Between 2000 and 2010, Met Council data indicate that 132,000 more people moved away from than moved to the Twin Cities seven-county region. By comparison, the Census Bureau indicates that Los Angeles lost 1.3 million and New York City lost 1.9 million. At the same time, people flocked to other metro areas: Atlanta gained 415,000; Dallas-Fort Worth, 318,000; Houston, 241,000, and Raleigh, N.C., 190,000.
What do “people magnets” like these areas, mostly in the South and West, have in common? Less burdensome government regulation and fewer land use restrictions. Both are strongly correlated with greater economic growth.
If we aim to compete with the nation’s most economically dynamic areas, the Thrive plan will push our region in exactly the wrong direction.
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Thrive’s first pillar is increased densification. It will require much more “compact” development in both developing and mature suburbs, with a special focus on cramming people into tiny areas around train stations in the urban core and first-ring suburbs.
If the plan follows typical “smart growth” ideology, it will place significant restrictions on land use beyond the urban fringe, though details are not yet clear. This will artificially restrict the supply of buildable land and drive up housing prices well above historical norms — along with the costs of retail and commercial development.
The measure of housing affordability is the median multiple — the median house price in a region divided by the median household income. In the Twin Cities, the median multiple is 3.1, while in Atlanta and Indianapolis — both thriving metros with little land use regulation — it is 2.7.
On the other hand, in Portland and Seattle — which have stringent urban growth boundaries and strict densification policies — the median multiple is 4.8 and 5.3, respectively. In San Jose, Calif., it is a breathtaking 8.7.
Over time, the Met Council’s densification crusade will likely drive up Twin Cities-area housing prices, reducing discretionary income and the standard of living for all. Our region will become less attractive to businesses, which will have to pay workers more to get them to come here.
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Thrive’s second major component is “transit-oriented development,” or TOD, which the Met Council describes as an “enormous undertaking.” The goal is to reduce automobile use by increasing density, funneling public dollars into transit, increasing congestion, limiting parking, and generally make driving more inconvenient and expensive.
Like housing densification, TOD drives up the cost of living. People come to a metro region for jobs. Research makes clear that a key to regional growth and prosperity is how many jobs they can access within a normal commute time of 30 minutes or so.
The Met Council’s obsession with rail transit is problematic in this respect. Rail transit is enormously expensive and heavily subsidized by taxpayers. Rail may make sense in a handful of older cities, like New York and Philadelphia, where a significant proportion of jobs are in the central business district. But in the Twin Cities, as in most regions, fewer than 10 percent of jobs (7 percent) are located in the principal downtown (Minneapolis), and even fewer (4 percent) in downtown St. Paul. The dispersion of jobs across metro areas is a strong historic trend.
In this situation, cars are by far the fastest and most convenient way to get to the vast majority of jobs here, and will remain so. Transit is not time-competitive with automobiles — transit’s average work trip travel time is at least 1.5 times that of driving alone. Thrive’s focus on transit-oriented development, which disfavors cars and favors rail transit, will reduce opportunity and sap prosperity.
In the Twin Cities region, the average employee can reach only 7 percent of jobs by transit within 45 minutes, according to the Brookings Institution. Drivers, on the other hand, get to their jobs in an average of about 25 minutes.
The Twin Cities is now the nation’s 16th-most-congested region. Congestion decreases productivity and increases freight costs. The Met Council’s densification policies will only make congestion worse, since traffic is heavier in denser areas.
Our region is projected to have just $52 million available annually from 2014 to 2022 for highway congestion relief. After 2022, even that funding will dry up. Yet the Met Council intends to spend at least $1.7 billion on the Southwest light rail project alone, with more rail transit to follow. That’s three times more on one rail project than will be spent in 10 years on highway congestion and bottleneck relief for the entire seven-county region.
Rail transit carries only about 0.2 percent of motorized passenger miles in the Twin Cities region. (Even in Portland, which has spent heavily on rail, it carries only 1.2 percent.) Rail costs about $90 million a mile to construct, while adding a highway lane to expand capacity costs just $10 million a mile. Despite this, the Met Council intends to pour a hugely disproportionate share of tax dollars into rail transit.
A transportation policy that so grossly privileges light rail over the personal mobility and freedom of the automobile — benefiting a tiny share of the population, a handful of large companies, and politically connected developers — is economically indefensible.
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The Met Council professes great concern about the economic plight of our region’s low-income households. Ironically, these households are likely to suffer most from its misguided policies.
The council deplores our region’s lack of “affordable housing.” Yet its drive for densification likely will significantly increase housing prices, which will harm low-income residents. Rents will rise, too. In Portland, for example, income-adjusted median gross rents in high-poverty areas rose more than 2.5 times the increase in the rest of the metro area during densification from 1999 to 2009.
The “gentrification” that accompanies transit-oriented development often disproportionately displaces low-income households, driving them from the urban core to more dispersed areas with less transit. Low-income families also suffer disproportionately when bus service must be cut to pay for light rail serving well-heeled suburbanites, as frequently occurs.
In the future, the metro areas that flourish will generally be those where opportunity can grow unburdened by counterproductive government regulation. The Twin Cities region has many assets — a relatively highly educated population, a strong work ethic and an enviable quality of life. But in an era of global competition, we can’t rest on our past. We have a very low rate of business formation and, in recent years, taxes as well as labor, property and energy costs have escalated substantially. And then there’s our frigid weather.
The Met Council’s new plan will add greatly to the challenges we face. If we want to thrive, Thrive MSP 2040 is the last way to do it.
Katherine Kersten is a senior fellow at the Center of the American Experiment. The views expressed here are her own. She is at firstname.lastname@example.org.