Economic Development – Goings On
— Regionalism Talk
There was new talk about regionalism this week:
Recent missions to Brazil, Colombia, Germany, Panama and Switzerland included Pinellas County businesses and organizations but were organized and dominated by key economic and political players from Hillsborough County.
The new alliance was announced at the 2014 International Town Hall by the bay area’s top economic development officials: Tampa Hillsborough Economic Development Corp. CEO Rick Homans and Pinellas County Economic Development director Mike Meidel.
That sounds good. What is the focus?
According to the Tampa Bay Partnership, in 2012, exports accounted for only 8 percent of the bay area’s GRP (gross regional product) for the eight-county region surrounding Hillsborough and Pinellas. The bay area ranked 88th among the 100 U.S. metro areas in terms of how much exports contributed to total GRP.
The national average is 12 percent of exports contributing to GRP. If the bay area were to reach that level of exports, it could inject up to $8 billion into the Tampa Bay economy and potentially create up to 40,000 jobs.
That is the case for regionalism right there. (And why has that pathetic export statistic not gotten more attention.) We have no idea why it hasn’t been the standard operating procedure before. (See “Economic Development – Samba Time”)
We are glad they said something publicly, though we have seen that before. Now, hopefully, something will really happen – and hope they know what they are selling.
— Chicken or Egg
Which brings us to a column in the Times about startup culture in the region.
Others suggest that puts the cart before the horse. Until Tampa Bay can demonstrate it is indeed a hub of successful entrepreneurial activity, it’s tough to slap a believable brand on this part of Florida.
That is all very relevant and accurate. We have noted the problem with branding the Tampa Bay area, namely, a lack of vision or actual identity (and how can you brand something when there is no sense of place?). And the lack of regionalism has played a major role in that.
The column then goes on to discuss the different situation in Miami:
Earlier this month, a billionaire entrepreneur named Manny Medina spearheaded a technology conference therecalled eMerge Americas Techweek. It drew 6,000 people, 150 speakers on tech innovation, eight expos, an invitation-only mayoral summit and a cool $250,000 grant from South Florida’s pro-development Knight Foundation.
First, Miami already boasts a global brand as a Latin gateway, tropical urban center, fast-lane lifestyle and the dumping ground of Latin American flight capital (look at those pricey condos going up — again) that’s always looking for viable investments.
Second, Medina — who sold his Terremark data services company in 2012 to Verizon Communications for $1.4 billion — stepped up to lead this effort with the street cred of a local entrepreneur who has hit it big. Tampa Bay’s still looking for that tier of successful individuals.
And third, Miami’s focusing a lot of its tech/startup firepower on one event imposing enough to get national media attention. Tampa Bay’s startup efforts remain spread among its multiple counties, cities, universities and incubators. It still seeks critical mass.
All of that is quite accurate. (more on the Microsoft facility here.) Miami had a preexisting, international brand (namely the Gateway to Latin America with a tropical, cosmopolitan, urban vibe). It also had money and entrepreneurs (they don’t all leave for the “big city”). It also focuses its tech/startup entrepreneurial efforts through its brand – the Latin American connection.
Interestingly, though, that does not answer the first question: “What comes first: a powerful regional brand or a vibrant entrepreneurial community?”
It seems to us that they grow simultaneously – or at least symbiotically. The brand builds allure. Entrepreneurs begin to develop their business and with success, they stay and build the brand. That in turn draws more talent and money.
Whatever is needed first, brand or successful entrepreneurial culture, one thing we know for sure – having neither won’t work.
Ridesharing and the PTC – Talks Begin
Now to the PTC. In a sign of a slight thaw:
Officials with the Public Transportation Commission have begun talks with at least one of the ride-sharing companies to find a “middle ground” that could allow the unregulated car service to operate inside the law in Hillsborough County, according to the agency’s executive director, Kyle Cockream.
“We’re trying to work through some things, but this is not a short-term process,” Cockream said. He declined to identify which of the companies he was talking with most recently, but did confirm he has talked to Lyft officials about several matters, such as insurance coverage. There is a long list of factors involved, Cockream said, primarily because Lyft and Uber operate so differently from taxi and limousine companies.
Well, that is a start. But even if the talks reach a deal, which is by no means guaranteed, there is an issue:
First, Cockream said, he would need to negotiate a preliminary deal with the ride-sharing companies. Then, if those talks succeeded, he would need to bring the proposed deal to the PTC board, issue public notice of any potential board meeting on the issue, and then the PTC would have to formally act.
Right – the rules are made by the PTC, which is made of elected officials. They can make all the needed changes if they want to. The question is do they want to? Maybe they do:
Transportation regulators in Hillsborough County have some bad news for Tampa-area taxi companies, and the Lyft and Uber ride-sharing services that recently started up here: There’s a middle ground to be found, and it won’t make either side happy.
During Wednesday’s PTC board meeting, Crist said he met recently with officials from Lyft, and will soon meet with officials with Uber to try and figure out a way for both companies to enter this market and — legally — pick up and drop off passengers around the region.
At least, the talks are a start, even if the PTC had to be pushed into it.
Economy – How’s the Housing Market?
Hillsborough County puts much of its economic development faith in the housing market. So how is it going?
Median single-family home prices here rose to $156,000 in April, the 29th month in a row of year-over-year price gains, listing data show. Even those appear to be tempering due to weak sales: Unlike the 20 percent price jumps of last spring, the last three months have posted the shallowest gains in nearly two years.
Climbing prices are helping homeowners recover lost equity, though many still owe more on mortgages than their homes are worth, CoreLogic data show. At the start of the year, more than 185,000 mortgages, or about 30 percent of all Tampa Bay home loans, remained underwater.
That debt continues to block prospective buyers from listing their homes on the market. Inventory for the Greater Tampa Association of Realtors has fallen every month this year, stumbling to four months of supply in March, below what agents call a healthy market.
Foreclosures also continue to bedevil the local market, keeping homes tied up in court and off the market. By April, Tampa Bay courts still faced a backlog of 38,000 pending foreclosures, which judges are resolving at a rate of about 2,000 cases a month, state court data show.
After a resilient year in construction, 2014 has so far proven lackluster for Tampa Bay’s new-home industry. In March, crews started building about 500 single-family homes here, down year-over-year for the sixth month in a row, census data show. Building permits, a sign of future growth, were also weak, sagging 17 percent from last March.
In other words, not so good. The lull may be a blip or it may be a sign of weakness in the local economy. Whatever it is, housing is not going to be the driver that fixes our economy. Housing long term is a reflection of the wider economy that will always show through (It is just that elected officials hope it will wait until after they leave office/win their election).
There is one brighter spot:
Meanwhile, thousands more apartments and rental homes have hit the market in the last year, as developers and investors bet big on a shift in consumer preferences toward short-term, low-risk rentals and away from the home-buying American dream. The rate of people who own a home in Tampa Bay fell last year to 65 percent, the lowest point in at least 27 years.
On the other hand, according to an article in the Business Journal on a PNC bank report on the local economy, even though there likely going to be job and population growth:
Income: Income growth locally, however, is restrained by an outsize share of jobs created in low-wage industries such as retail, leisure and hospitality. Florida’s minimum wage is higher than the federal minimum, yet the gap between living income and living costs remains wide.
So even if people buy houses, what kind of houses can they afford, and if they splurge on housing (even just renting), can they afford other things? How will low wages drive a growth in the per capita regional product to push the economy?
The bottom line is that we can’t just rely on population growth and the related housing boom anymore. We need to build the fundamentals of the economy.
Transportation – Getting There
This week the Business Journal had a report on transit use for commutes:
Actually, it is quite obvious. The local transit systems are not very robust (hence, the need for things like Greenlight Pinellas). However, there is something more interesting to us – the rapid growth in usage despite the lack of robust transit systems. A 2008 report in the Times indicated that commuter usage was only 1%.
. . . Steve Polzin, director of mobility policy at USF’s Center for Urban Transportation Research, argues this area still isn’t ready. Not when only one percent of travelers use buses, and where less than a fifth of all trips are for work. And only in Los Angeles are jobs more dispersed than in the Hillsborough-Pinellas area, Polzin says.
Now, 6 years later, it is 1.6%. So we are more than half way to the bus expert’s requirement and still growing. (See here) Since it takes time to plan and build a rail system and given the growth rate of bus ridership even with limited funding and service, now is the time to start planning, right of way acquisition, and funding development.
And that brings us to one other point. We have been critical of Hillsborough County’s transportation planning because 1) it is bad and 2) it is taking a very long time. On the other hand, the Transportation for Economic Development group is supposed to come up with a plan this summer. But that worries us, too. Rushing out something to address a problem one has long ignored is not the optimal method for success.
We just hope given all the delay, they still come up with something comprehensive, rational, organized, systematic, and integrated. Past experience would say it won’t be, but it might Time will tell.
Transportation – This is Intermodal?
We noticed something interesting in a Tribune article about Megabus (and, for the record, again, we have nothing against Megabus):
The space-leasing fee Megabus.com will pay to the Hillsborough Area Regional Transit Authority, or HART, is earmarked for maintenance and security at the Marion Transit Center (MTC) downtown. HART spokeswoman Sandra Morrison said. Megabus.com will pay the transit authority $15,000 annually for five years.
Ok, $15,000 is not that interesting, but that part of the article was necessary to explain later parts:
And the new intercity service coincides with the opening of the Metro510 residential complex nearby. Metro510, which opened last year, is south of the MTC. Another residential high rise is under construction nearby.
Ok, neither building near the MTC is high-rise; they are mid-rise buildings, but that gives the flavor of the article.
“MTC has become a busy intermodal hub for Bus Rapid Transit in Tampa,” said HART Chief Financial Officer Jeff Seward. In addition to regular HART customer transfers, the center also handles buses coming in from St. Petersburg and will now include Megabus customer traffic, he said.
Morrison said adding Megabus to the mix of offerings is part of what HART is doing to focus on new ridership, new revenues and enhanced services. This intermodal approach, she said, is HART’s way of connecting various modes of transportation from bike riders to TECO Streetcar System customers and park-and-ride lot users.
Ok, so here is the point – the MTC is not really multimodal unless you think a bus station that people walk into makes it multimodal. And the streetcar is irrelevant because the streetcar comes nowhere near the MTC and the transit service is bus service (they admit there is no parking). Yes, you can bike to it, but it is not like it is a hub of bike trails or paths.
Really, by HART’s definition, every bus stop is multimodal, which renders the term meaningless (though it sounds cool) which is par for the course for much of the transportation (and other) discussion in Hillsborough County and the Tampa Bay area.
Transportation – What to Do With US41
There was an article in the Tribune about US41 in southern Hillsborough:
As part of that effort, the Florida Department of Transportation District Seven is studying the possibility of widening an 8-mile stretch of U.S. 41 from four to six lanes between State Road 676 (Causeway Boulevard) and Kracker Avenue to the south.
The study also considers the bridges crossing the Alafia River and Bullfrog Creek, which may both need to be replaced, and examines the possibility of adding bike lanes, sidewalks and bus stops along the route.
U.S. 41 is one of three heavily traveled north-south roadways in southern Hillsborough County, running parallel to Interstate 75 and U.S. 301. The goal of this study is to improve traffic flow and safety, FDOT officials say.
Once again, we have no problem with planning. However, is there a timeframe for the improvements?
For now, there is no funding for the widening and bridge replacement, said Project Manager Stephanie Pierce, but the study could help line it up for the future. The analysis should be complete by spring 2015, she said.
“We are looking at what the effects of the widening would be on the environment and what the community impact would be, like purchasing rights of way, would there need to be (business) relocations and is it better to acquire right of way from the east side or the west side,” Adair said.
The county’s Metropolitan Planning Organization, which addresses future transportation needs for the county, doesn’t list this project as “affordable” in its 2035 Plan for transportation improvements, but the plan does mention the need to widen U.S. 41 to six lanes.
So there is no money, just like most other roads in Hillsborough County. That is a result of County policies. Nevertheless, why not toss it in as a project in any future referendum on transportation? If the southern part of the County just wants more roads and to have everyone else to pay for their transportation, they should have to pay for other areas, too. Otherwise, they should have a transportation system like everyone else – poor and overburdened.
Transportation – Pasco Toll Road Postscript
So the private Pasco east-west road is dead. Now what?
The county’s planning staff is looking at several alternative east-west routes, among them Ridge Road, County Line Road, Tower Road and State Road 52. But planners still think an elevated toll road would move traffic more effectively, and they’re betting that it could be more palatable to residents in another 20 or 25 years, after they’ve spent countless hours in stuck in traffic on S.R. 54.
Atefi said the study will include “sensitivity testing” of the various alternative routes. In other words, if the state widens S.R. 52 to six lanes, how many trips would that take off S.R. 54? What if the county widens County Line Road to four lanes? And so on.
The study also will look at widening S.R. 54 to eight lanes. “With the volume we saw, eight lanes is not going to solve it, and we thought going over eight lanes is something you don’t want to do,” Atefi said. “Because you also have to add in turn lanes, and it just gets unmanageable. It’s really not good planning to go beyond six lanes.”
In other words, the problem remains, as do the limited options.
There was one idea typical of Tampa Bay planning – pass the buck:
Zephyrhills City Councilman Lance Smith said the study also should consider alternative routes in Hillsborough County. “It seems to me it’s a regional issues since so much of the traffic is coming up from Hillsborough,” he said.
Thankfully, that did not fly (It’s not like Hillsborough would do anything, anyway.) Yet, opponents of the east-west road still want the idea killed (because their opposition had nothing to do with the road being private):
Leaders of the grassroots Pasco Fiasco group, which organized thousands of toll road opponents, want the elevated highway removed from the county’s Long Range Transportation Plan. They’re still planning a rally May 19 at Sunlake High School.
Good for them. Now, at least, planning in Pasco will return to the standard Tampa Bay – do half measures, wait a generation, and try again.
Economic Impact – Breaking Records and Broken Records
A few weeks ago, the IIFA went off quite well. No big issues. Everyone seemed to enjoy it. Great. Time to move on.
Well, not quite.
In a phone interview, Mark Bonn, president of Bonn Marketing research company, said the figure could drop by $10 million to $20 million, based on revised attendance numbers he got Wednesday. This would bring it closer to earlier estimates for economic impact of $10 million to $15 million.
The $30 million estimate was based on an attendance forecast from February, Bonn said. Corrada said Bonn had been using 31,000 — an early guess at attendance for the April 26 International Indian Film Academy Awards show. Actual attendance at Raymond James Stadium was about 24,000.
“That’s fine. … We’ll go with whatever number he comes up with,” Corrada said by phone Wednesday evening. Corrada added he felt Bonn’s model could underestimate economic impact, since it doesn’t count people who came for the gala weekend but did not attend Saturday’s show.
Ok, $10 million, $30 million. Either is ok. Not spectacular, but fine.
However, it seems that is not enough for some.
The four-day series of events, ending with the April 26 awards ceremony at Raymond James Stadium, generated nearly $32 million in direct spending in Hillsborough County and a total economic impact of $56 million.
Wait a minute – where did the extra $20 million come from? (Apparently, they are not going with whatever number the expert came up with.)
Look, we understand that (and often say) that adding money to the economy allows other people to spend the extra money they make (or save it). That is a good concept for business development planning. However, it is almost impossible to quantify (as noted above by the abovementioned expert – even direct impact is often hard to quantify).
Why can’t officials just accept that there was anywhere between $10 million to $30 million in direct impact and move on? Why the persistent need to over-hype everything? (And, anyway, we thought the idea behind hosting the IIFA was to expose the area to new parts of the world.)
Which leads us to another article about tourism in Hillsborough County we saw this week – not surprisingly about the same agency that gave us the above estimates?
“It means more people are buying merchandise at our shopping malls,” said Visit Tampa Bay CEO Santiago Corrada. “They’re spending more money on restaurants. They’re spending more money on accommodations. They’re spending more money on entertainment.
Setting aside that the “purest” form of economic development (if there is such a thing) is people moving here; starting successful businesses; and growing employment, income and the economy; ok, that is good. A new record. But there is something odd:
Wait – more impact in Hillsborough than in Pinellas, even with their beaches?
Florida State University hospitality professor Mark Bonn, president of Bonn Marketing Research Group, put together the Hillsborough tourism report for January through December 2013. He built his model using data such as hotel occupancy numbers, spending in hospitality industries and detailed interviews with 5,000 visitors last year. Pinellas tourism officials use a different research company and methodology.
Oh, so using the figures comparisons between the counties are impossible.
So this is the thing – just like we have no problem saying the IIFA went off well, we have no problem with saying there is record tourist spending in Hillsborough County. What we do have a problem with is having a public agency that throws out numbers that are essentially meaningless (especially if they are self-serving). It is fine to say Hillsborough County is getting better, but we need numbers that can be compared to other areas and that can be supported. What we definitely do not need is the standard hype we have had for decades.
How little our DNA seems to have changed.
How Many Playing Fields Do We Need? – Cont.
In the race to build playing fields, it seems that Pasco is winning.
Now retired slugger Fred McGriff is in negotiations to join his former teammate Gary Sheffield as part owner of Pasco Sports, the company planning a massive $34 million baseball complex in Wesley Chapel.
In January, Pasco County commissioners agreed to a 45-year contract with Talton to build and operate the complex in Wiregrass Ranch, just north of Tampa. Talton must raise $23 million by mid-July before Pasco will release the $11 million it pledged.
So the Pasco complex has poached to big names from Tampa. Good for them. The real question is who cares if Pasco is winning? We sure don’t. We have no idea why Hillsborough County is in such a hurry to build playing fields on strategically located, public land. It has bigger things with which to concern itself.
List of the Week I
Our first list of the week is biz2credit.com’s list of 2014’s Best Small Business Cities in America. biz2credit.com describes itself as “the leading online credit resource for startup and small business loans, lines of credit, equipment loans, working capital and other funding options.” The list’s methodology uses
a weighted average that includes annual revenue, credit score, age of business (in months), cash flow, debt-to-income ratio, incorporation (C-Corp or LLC vs. sole proprietorship), and business owners’ personal credit scores.
The best city is San Jose, followed by Detroit, Denver, Los Angeles, San Francisco, Las Vegas, New York, Atlanta, DC, Miami-Fort Lauderdale-West Palm Beach, Riverside-San Bernardino, Tampa-St. Petersburg, Sacramento, Indianapolis, Houston, Chicago, Portland (OR), Dallas-Fort Worth, Phoenix, Charlotte, San Antonio, Seattle, Jacksonville, Philadelphia, and Orlando.
Ok. That’s good, though it does not distinguish what kind of jobs the business create, which is important.
List of the Week II
Our second list this week is nerdwallet’s Best Cities for Recent College Graduates. The methodology includes measuring 1) presence of educated peers, income and cost of living, and strength of workforce.
The best city is DC, followed by Seattle, Minneapolis, San Francisco, Austin, Atlanta, Raleigh, Boston, Denver, Columbus (OH), San Diego, Charlotte, San Jose, Nashville, Arlington (TX), Virginia Beach, Dallas, Portland (OR), Houston, and Omaha.
Not good for attracting young talent to start those small businesses.