Sunday, August 03, 2008

Our Region's Future Depends on Our Small City

Our region’s ego took a hit last month when the Census estimated that the City of Pittsburgh is now only the 59th largest city in the U.S., down from 54th in 2000, and smaller than places like Aurora, Colorado and Bakersfield, California. In 1950, Pittsburgh was the 10th largest city in the country, but its population has dropped by over 50% since then, one of the largest population declines among any major city.

What caused this precipitous drop? High taxes? The loss of the steel industry? Bad city management?

The primary explanation is actually quite simple – with only 55.6 square miles, Pittsburgh is one of the tiniest of the major cities in the nation. Among central cities in the top 40 regions, only Boston, Miami, Minneapolis, Providence, and San Francisco are smaller in land area than Pittsburgh. Most big cities have at least twice the land area that Pittsburgh does.

In cities with more land area, many people who moved “to the suburbs” stayed within the corporate limits of the central city. But in Pittsburgh, the suburbs are different municipalities, and suburbanization meant population loss for the city.

However, while residents moved out, their jobs did not. Although Pittsburgh ranks only 59th in the number of residents, it ranks 25th in the number of jobs located in the City (in businesses of all types). In 2004, there were nearly 300,000 jobs in the City of Pittsburgh, more than in many cities that are much bigger in terms of population. And the City would probably rank even higher if it weren’t so small; Pittsburgh ranks 6th in the country in jobs per square mile, behind only Boston, Miami, New York, San Francisco, and Washington, DC.

The jobs located in the City of Pittsburgh support families throughout the entire region. In fact, only about a third are filled by people who live in the City. Nearly 200,000 people, from every county in southwestern Pennsylvania and from West Virginia and Ohio, come to Pittsburgh every day to work.

Most people don’t realize how much our region’s economy depends on the City of Pittsburgh. More than 1 out of every 4 jobs in the Pittsburgh metro area are located in the City. Moreover, the City houses three-quarters of the region’s higher education jobs, half of the jobs in finance and company headquarters, and over one-third of the jobs in professional services, health care, and arts and entertainment. Several of these are the sectors that have created almost all of the region’s job growth in the past several years.

And of course, the City doesn’t offer just jobs; it is also the region’s primary source for advanced health care, higher education, culture, entertainment, and sports, which are major attractions for talented workers, regardless of where in the region they live.

The challenge for the City is providing the public services needed to support these jobs and regional attractions, but with a tax base that depends primarily on a shrinking base of residents. Raising tax rates on either businesses or residents won’t work, because it’s too easy for either group to move across the City line to escape them. So it’s critical for the City to attract more residents in order to increase its tax base.

Aren’t the City’s high tax rates a major deterrent to living in the City? Yes, but high gasoline prices are an equally high deterrent to living in the suburbs. What most commuters save in taxes by living in the suburbs is now more than offset by the cost of gasoline and depreciation on their car.

Because of the central role Pittsburgh plays in the region’s economy, it’s a priority for the entire region to make sure the City can attract and retain residents. Strengthening the City’s finances and improving the quality of the City schools are particularly important. Our region’s future depends on having a healthy central city.

(A shorter version of this post appeared in the Pittsburgh Post-Gazette on Sunday, August 3, 2008.)


Blogger Schultz said...

A few comments:

One problem that prevents the city from competing with the suburbs for new residents is its aging housing stock. One solution would to build new affordable ($200k or less) housing units in the city, but a barrier to doing so is the high cost of developing in the city of Pittsburgh. $200k can get you a nice 3 or 4 bedroom home in a suburb like Mt Lebanon, which has the T and also a great school district. It would cost a lot more to purchase the same exact house within the city limits.

2. "The primary explanation is actually quite simple – with only 55.6 square miles, Pittsburgh is one of the tiniest of the major cities in the nation."

How can this be a primary explanation? First, as you noted in your article, Pittsburgh is not among the "major cities in the nation." You also mention cities like Minneapolis having less square miles than Pittsburgh - but Minneapolis is doing pretty well growth wise, aren't they?

Also - look at Chicagoland. Millions of people live in the city, which does have a huge footprint, but millions of people also live outside of the city limits in the suburbs.

I don't think land mass is the most important criteria for growth here in Pittsburgh - but I think smarter use of our existing land is! One way to solve the problem of the lack of housing options in the city is to start a program to demolish all of the vacated and blighted properties in the city. Buffalo NY, my hometown, has undertaken an initiative like this. Razing 1000+ buildings would be a huge, and expensive, undertaking but putting these properties back on the tax rolls is one way to reverse the trend of the shrinking city. Removing the houses will also help in terms of reducing crime and also fires, which often break out in abandoned properties and spread to other residences.

12:22 AM  
Anonymous Anonymous said...

I don't think the answer to the causes of a precipitous drop in our city population was addressed at all!

Just an explanation of one of the smallest factors in this 30+ year old problem to avert readers to the real root of the problem. The loss of the steel industry, in which bad city management compounded the detrimental effects, by lack of action to seek out companies that could have used that kind of labor force. Oh,then our high taxes put the icing on the cake.

Though,I believe it is great that our workforce is becoming more highly skilled and trained I think the city has fallen short of providing living wage jobs for individuals not in the higher education or health care sector.

I thought the idea was to stop the flow of people leaving the city and to attract citizen to our great city! Now, every time I read about progress or even browsing your website "Pittsburgh's Future" of new jobs or progress in this region. It is located outside the city in these very suburbs that our citizen fled to. That will more than likely be filled by these same people. Giving people no reason to flock to the city.

5:24 AM  
Blogger Schultz said...

Lee is correct, no solutions were offered and the root of the problem was not address. It comes down to poor governance and poor policies. Having lived in the city for 11 years and now living on the other side of the fence I think I have a good idea of the things that are driving people out of the city and making most of those moving here from outside the region choose the suburbs.

Here a few of the things that need to be fixed:

1. Quality of the public schools. A few are good, some are okay, but a lot of them are just bad. The city thinks that the Pittsburgh Promise will solve the problem but the promise is nothing more than a diversion, and a gimmick - it does nothing to address the quality of the education.

2. Blight - too much of it and it exists in just about every neighborhood! The city has started buying back the liens on old vacated lots but much more has to be done. They need a massive demolition effort followed by development of quality affordable singe family housing and town homes. Any savings from the bond deal should go towards demolition.

3. Old Housing stock - city needs more newer built homes that a typical family can afford. see above

4. Police response times - the police either ignore your complaints or they take forever to show up.

5. Harold mentioned the disparity in the wage taxes in the city and the suburbs. Since so many suburbanites use the city services and infrastructure, and since the city is in such a huge hole, a commuter tax is needed. I think there should be a commuter tax of 1.5 to 2.0% of wages for those who work in the city and live in the suburbs. They would pay the difference between their local tax and the city tax. That means I would pay a total of 2% on wages - 1.3 to my municipality and .7% to the city. This puts city residents and suburbanites on a more level playing field. It also might make some reconsider moving out of the city if taxes are their primary motive (probably not though, see above!). City residents pay about another 1% in wages taxes for the school system, although the amount that goes to the schools went down over the last couple years.

The bottom line is that your tax dollars go much further outside the city of Pittsburgh. In Mt Lebanon I know my school property taxes are funding a great school system and that my wage and municipal property taxes fund a police force that is responsive.

Also, most of the times it comes down to the children. People want their kids to go to the best schools possible. If it is more cost effective to move better school systems in the suburbs most are not going to think twice about it.

1:23 PM  
Blogger Burgher Jon said...

I agree with almost everything Schultz said... I do want to challenge one thing though... the cost of housing.

Yes, housing in downtown proper is outrageously expensive. There are however more then enough houses of reasonable size that a family could afford in the southside, northside, oakland, bloomfield and the hill. The reason families don't move in to those houses is the services and taxes. The bottom line is that (as you said), people can get better services (police, schools, etc...) for less tax dollars in the suburbs. The reason for that is that the suburbs don't have to provide services to as many places of employment AND they don't have to deal with as many low-income people as the city does. As long as high-income people can avoid paying taxes to municipalities that have to support low-income people just by moving a couple easilly traveled miles, they're going to.

4:15 PM  
Anonymous Anonymous said...

One of the major causes of the decline of central city population that is rarely addressed (but Harold alluded to) is the nationwide (and developed-world-wide) demographic trend towards lower birth rates and smaller household sizes. In a landlocked city like Pittsburgh, which is somewhat exceptional in its inability to annex land, the population had nowhere to go but down during the 2nd half of the 20th century. The 55 sq. mile core city has been 99.9% built-out for decades (we find a giant slag heap to redevelop every now and then), and in the absence of annexation power has been unable to expand its municipal reach to nearby suburbs. This same demographic reality confronted other under-bounded land-locked core cities throughout this period (St. Louis, Cincinnati, even Boston). Many "growing" central cities, such as Omaha and Indianapolis, have actually lost population in their historic cores during recent decades, but have been able to enjoy overall municipal growth due to their corporate expansions. The City of Pittsburgh is one of the most extreme examples of an under-bounded "center of the region" in the country. As a regional economic center with a very local tax base, it does not receive the financial support that it should. In this hyper-fragmented metropolis, we tend to view things as "city" vs. "suburb"/"suburb"/"suburb"... but when you compare the city of Pittsburgh's extremely restrictive taxing and annexation powers to peer cities across the country, you realize just how ludicrous the situation here. Unfortunately, I think it will take a top-down approach from the state government to ever remedy the situation here... as there's too much tunnel-vision small-town-mentality inertia in the hundreds of useless municipalities here to ever get anything done.

7:53 PM  
Blogger Schultz said...

"The reason families don't move in to those houses is the services and taxes."

BurgherJon - i used to live in Beechview. Houses there go for $60k, even less than that, but the problem is they are very old and deteriorating. It was a great little starter home but no central AC in these old homes during this time of year is brutal! The problem is not the lack of affordable houses - the problem is the lack of affordable new houses. Pretty much all of the new residential developments, townhouses on the south side, condos in downtown or in the strip - are too expensive for the typical family.

Regarding Evergrey's comment, I still do not believe lack of land is a barrier to growth. We have over 1,000 abandoned houses in the city. Tear them down and rebuild! That $3million that the city council is talking about putting towards the deficit or street paving should be put in a demolition fund so we can get these properties back on the tax rolls.

11:44 PM  
Blogger EdHeath said...

I think it is crucial to understand why this city and region has lost people since the ‘70’s. Clearly the steel mills shutting down started the population loss, as people who could get out to jobs in other cities left. The ‘70’s too was a time when higher education started to take off, but students who left Pittsburgh for other schools and even many who went to school here left the city when school was done for greener pastures. Meanwhile, a lot of the corporate headquarters based in Pittsburgh also moved, taking employees with them. At a certain point, the unemployed stopped leaving and the corporate headquarters stopped leaving. The population that remained in Pittsburgh was skewed toward the elderly, and instead of leaving they started dying. That still reduces the population, though, and the job growth here, while positive, has been anemic enough that students still fail to return (or stay if they are CMU or Pitt graduate students) when they go away to college.

But some (very) recent changes have given me some renewed optimism. First, as Mr. (Dr?) Miller notes, the price of gas has made the suburbs suddenly less attractive. Second, buying a new house in the last twenty or so years meant buying an energy efficient house. But the fashions of the times meant that new houses grew and grew over the years, and suddenly it was clear that new houses might be “tight” but were no longer energy efficient. As green building became fashionable to at least a few people, that still meant building from new. But just in the last few years, a realization has arisen that maybe rehabbing an older house is the real green building. John Fetterman was quoted on the PBS News Hour as saying the greenest house is the that is already here (he has a vested interest in attracting homeowners, of course).

So I diverge with Chris Schultz in that I don’t think we absolutely need to tear down the thousands of abandoned houses and build new ones. Some houses may be empty because the owners died and either had no relatives or the relatives live too far away to handle a sale. Now, some houses, falling apart or being used as crack houses, should be torn down. But even then I would wonder if the lots couldn’t be used to grown switch grass or some other potential biofuel, before being sold to build new.

I think it would help if city government could get its act together and start initiatives to showcase the city. Build a solar array. Put half the police on bicycles. Buy not Malibu hybrids but Ford Escape hybrids and convert some to plug in. Put Pittsburgh on the front page of the LA Times and Washington Post in a good way, not for amateurish scandals and squabbles.

I suspect if Chelsa Wagner was elected Mayor, she would be the new youngest Mayor in the US, and a woman to boot. That ought to be good for a Daily Show and/or Letterman appearance or two. And after all, if experience is no determinant of success as a President, it is not likely to matter for the Mayor of Pittsburgh either.

12:53 PM  

Post a Comment

<< Home