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Think tank’s urban jobs agenda misguided

BY By David Panagore and Jonas Maciunas

5/12/2014
David Panagore
The Connecticut Policy Institute (CPI), founded by Republican gubernatorial candidate Tom Foley, issued a series of white papers earlier this year about economic development.

With the election for the state's top spot heating up and Foley running neck and neck with Gov. Dannel P. Malloy, it's a good time to assess some of the economic development initiatives and thinking from the contender's camp.

By our review, we suspect the results might not be something small government types like Foley can get behind. In fact, when not proposing policies that are already in place, CPI's recommendations are a brazen play to extend and further centralize state power. We were struck by the anti-local and over simplified analysis.

How simplistic? The data used by CPI to chart "urban jobs" and their decline was actually regional, implying towns like Fairfield or Simsbury are equally suffering from Bridgeport and Hartford's "urban" malaise. What this data actually suggests is that the state has a metropolitan jobs problem and that the suburban growth (sometimes at the expense of cities), and urban decline, actually mask this even more significant challenge.

CPI's analysis also oversimplifies the similarities between the state's major cities and makes the same recommendations across the board as though each city struggles for the same reasons. Though each community would benefit from more business activity and jobs, they face different challenges, requiring different approaches for economic development. For example, Bridgeport has about 146,000 residents but only 40,000 jobs. Hartford has only 125,000 residents yet supports 115,000 jobs.

CPI's one-size-fits-all urban centers analysis also assumes permitting and regulations for suburban greenfield development and urban development should be indistinguishable. They view local permitting as a bureaucratic impediment, rather than a complex series of demands driven by the history, density, and conflicts more inherent in urban than greenfield development.

Asserting that local governments "can't get it right," CPI recommends expanding state power to usurp municipal development programs and regulations, smacking of outdated central planning. This recommendation is confrontational, good for big developers, and bad for communities. However, while creating zones where developers could be exempt from local regulations in favor of state standards is a bad idea, streamlining permitting approval is a good one. An alternative to the CPI proposal would be to competitively provide cities with resources to overhaul their regulatory infrastructure, which Hartford has already begun.

Tax breaks are often traded for jobs, either new jobs or retaining existing jobs as a means of driving development. CPI recommends vastly expanding enterprise zone areas, clarifying the rules, and requiring job growth as the measuring stick. While the potential for good is there, more work needs to be done, otherwise the state will be imposing tax cuts, not on a deal-by-deal basis but across the board, fundamentally undercutting local revenue.

CPI has it right that transportation is key to revitalization, but makes expansion of Tweed or Sikorsky airports their only infrastructure recommendation for urban jobs growth. Expansion of the state's transportation infrastructure is critical, and that includes all of the airports, rail and port options. The state needs to determine how its cities and Bradley International Airport fit into the North Atlantic region and, through rail connections, strengthen that relationship with the Boston-Washington rail corridor.

Among the last of CPI's recommendations is for a statewide small business incubator program. This initiative takes a page from Gov. Dannel P. Malloy's playbook, but instead of taking it a step forward, takes it one step back. Incubators are out of date. Created with the best intentions, they have become government-subsidized places for small business to stay on life support in a state of "zombie-preneurship."

The Malloy administration has developed CT Next, a comprehensive set of accelerators, support services, one-stop shops, fostering the existing network. CPI is on the right track, but needs to kick Malloy's plan up a notch, not take one step back. Finally, CPI promotes placemaking in urban development, and endorses improving Bushnell Park, the New Haven Green, and the Bridgeport waterfront. We welcome CPI aboard for seeing the light on that recommendation.

Connecticut's urban jobs crisis is deeply enmeshed in our fiscal crisis. CPI correctly identifies the vicious cycle of urban disinvestment in which deindustrialization, tax base erosion, and higher taxes to maintain services compound each other. Here's a radical proposal to break that cycle: Rather than creating a new tax, or racing to the bottom to cut existing ones, let selected cities keep a portion of the state income tax generated within their boundaries. This would more accurately reflect urban economic activity, ease the property tax burden, allow for improved municipal services and infrastructure, and take the state out of the annual subsidy business.

Our cities should not be wards of the state. Ensuring that they are not, and fostering job growth, requires engagement and empowerment, not doubling down on state control.

David Panagore is the former chief operating officer of the city of Hartford. He writes an occasional column for the Hartford Business Journal. Jonas Maciunas is an urban planning consultant with the RBA Group and previously served as complete streets coordinator for the city of Hartford.