Tuesday, September 30, 2008

Impact From Wall Street Trickles Down

Who would have guessed that the most serious wave of socialism wouldn’t bubble up from the demands of the unwashed masses but would walk over in Canali suits from Wall Street?

It’s been a long, strange journey, and it may get both longer and stranger, but it does look like the nationalization of key financial sectors will change the traditional way that we view – and or willing to accept - “capitalism at any cost” federal policies and from the notion that government is essentially the vehicle for concentrating great wealth among the privileged few.

It’s no wonder that average citizens are outraged, and the pundits oft-recited talking point about “Wall Street and Main Street” has done little to reduce the volume level of middle America.

Anger And More Anger

It’s not that average citizens are just angry because a handful of people have made billions of dollars. More to the point, their anger is fueled by a simmering, and now open, resentment about legal eagles and financial advisors being able to game the system to make extraordinary amounts of money. In essence, they made billions by setting up a system that paid them to produce nothing concrete.

It was all on paper as they conceived and created a financial system that allowed them to charge obscene amounts of money for managing that same arcane system and for delivering up the paperwork and validations that were made essential by their creations.

Tom Wolfe was right. They were masters of the universe, and they should have been. It was a parallel universe that they themselves set into motion and in which they reigned supreme, as attested to scene after scene of dozens of functionaries sitting in New York boardrooms, being paid handsome sums in exchange for reams of paperwork (and frequent political contributions) as part of a financial sector that was a shadow industry with a parasitic relationship with government.


At least when some of us lost money in betting on Silicon Valley, we were putting our money on the ability of American inventiveness to create breakthrough products that we could hold in our hands. And despite the bubble that burst, we benefit from these products every day in our digital village.

Meanwhile, Wall Street thought of new ways to find the gray area, to build structures that would have made Rube Goldberg proud and to develop financial products that make the explanation of quantum physics easy to grasp. In doing this, they devised ways that they could be paid exorbitant amounts under the pretense that they were really entrepreneurs.

In the words of someone who actually still knows where to find Main Street America, Warren Buffett, these were essentially “financial weapons of mass destruction,” because the people raking off the big bucks had no skin in the game, and if a public or private project tanked, they still walked away with their paychecks.

Big Numbers

These days, Wall Street looks to Main Street to move it away from the financial precipice on which we are all perched, but in the interim, local governments like ours are left to analyze and plan for the impact of the Wall Street crisis on them – on investments of various public pension systems that have billions of dollars in their accounts, the impact on cash flow and the impact on any borrowing planned by public entities.

The public sector offers graphic examples of the price of Wall Street sign-offs, advice, approvals and authorizations. In a three-year period involving 24 transactions by Shelby County Government alone, the amount of fees paid to consultants, bond advisors, bond companies, bond rating agencies and bond lawyers totaled $11,072,748.88.

One refinancing alone cost $3.4 million in fees, and over the three years, one law firm was paid $1.4 million, underwriting fees were $3 million, rating agencies were paid $680,000 and financial advisors made $1 million.

Rub The Rabbit’s Foot

It’s not as if somehow county government was unique in this gouging, because similar charges were connected with financial transactions for other local governments and governmental authorities.

Times are hard enough for local government. Already faced with drop-offs in revenues caused by rising gas prices and lower consumer spending, financial officials now know that they will face another tough budget process for FY 2010, but in the meantime, most are left to cross their fingers that the unfolding financial chaos does not upend budgets for a current fiscal year that is only three months old.

Monday, September 29, 2008

Herenton Committee Evaluates Convention Center Future

There is little question that city and county governments made a serious misjudgment when they expanded the Memphis Cook Convention Center.

Because of it, we’re inclined not to join those dismissing out of hand Mayor Willie W. Herenton’s notion of considering if Memphis needs a new or dramatically renovated convention center.

Before the expansion, the Memphis convention center was a bunker. After the expansion, it became a bunker with a performing arts center stuck on it.


To complement its fortress appearance or because of it, the convention center is drab and dreary and predestines Memphis to remain low on the ladder of top convention cities.

In a world characterized by stylish, airy, light-filled convention centers, Memphis Cook Convention Center is a throwback to another age. If you doubt it, just check out the photographs on this post. They show Pittsburgh’s convention center, and while it’s probably one of the best of its kind, it does in fact reflect the more appealing architecture prevalent in today’s convention markets.

The Memphis convention center expansion – setting aside for the moment the fact that it cost twice its original projection and took twice as long to complete – was the architectural equivalent of putting lipstick on a pig (no political commentary intended). The expansion did little to offset the gloomy interior and the gloomier meeting experience in the convention center, and in truth, the Cannon Center for the Performing Arts – as much of an upgrade as it was from the old auditorium - is equally meager when compared to similar halls in other cities.

Taking A New Look

As a result, any new convention center would need to be accompanied by visitor-generated tax sources - not property taxes - that could pay the cost of a $300 million facility – a moderately-priced center - that would cost about $18 million a year for two or three decades. The debt service payments for a convention center costing the same as Nashville's proposed convention center would cost twice that.

Despite predictions to the contrary, City Hall did in fact avoid the use of any property taxes or general fund money at The Pyramid, so there's little reason to dismiss the pledge that the same can be done with a new convention center. Of course, there's always political volatility with the idea of a new public facility costing as much as a convention center, because many members of the public believe that the funds should be spent on schools, or parks, or law enforcement.

It just can't happen. The regular tax sources used to pay for the old convention center and the convention center expansion can't be used for any of these other purposes. They are set aside to fund convention centers or other "public assembly facilities."

No Downside

Actually, on this one, we agree with Mayor Herenton that there’s no downside to considering whether a new convention center is needed and what impact it could create.

He has instructed the special convention center committee considering this issue to evaluate it carefully and thoroughly. And best of all, he has suggested in media reports that before his special convention center committee can even consider what could be built, it needs to determine where Memphis stands as a destination city for national - not just regional - conventions.

From all evidence and reports from the committee members, Mayor Herenton is encouraging this kind of serious, thoughtful analysis and evaluation. It's also worth remembering that the idea of a new convention center did not originate in City Hall, but with the tourism industry and the Memphis Fast Forward plan.

Fast Forward

When tourism became one of the major priorities for the new economic development plan, it only made sense that there should be an analysis of our institutional anchors - such as a convention center - to see what could be done to grow the $3 billion tourism industry in Memphis.

For years, the tourism industry has lobbied local government officials for the need for a more dramatic, ambitious plan for the future, and inevitably, this discussion turned to the possibility of a new convention center. In fairness to Mayor Herenton, it seems that sinister motives are often attached by some people to any suggestion that he makes, even when he wasn't the first person to make it, as in this case.

In addition, it's more than likely that if the committee made the case for a new convention center, found the funding for it, and then recommended its location, the Herenton Administration would no longer be in City Hall.

We say all this to say this: there is a broad-based group of people - some from tourism, some not; some who've spoken out for a new convention center, some not - looking into the convention center question, and there's really no reason that we shouldn't let the process run and see what they have to say.

Sunday, September 28, 2008

Personalities Often Obscure Proposals

In politics, you know things are getting out of hand when your very presence produces an added overlay of suspicion and mistrust that complicates public decision-making.

That's certainly been the case with the conspiracies and intrigues ascribed to plans to expand Beale Street and to consider a new convention center.

These days, it seems that every plan or idea is made more volatile by attaching the mayor’s name to it. A Herenton Convention Center plan produces more heat than just a convention center plan. The Herenton plan for Beale Street immediately sparks rumors when compared to Memphis’ Beale Street plan.

The Dividing Line

While the headlines about an option to purchase the Greyhound bus station by Mayor Herenton associate E. W. Moon in the location that makes the most sense for a new convention center – the Peabody/Beale Street area – rightfully raise questions, but as is often the case in city government, and contrary to outside impressions of grand conspiracies, Mayor Herenton generally gets a process under way and has little voice in what they do. According to tourism officials, he had no voice in who was selected for the convention center committee nor in what their agenda was to be. In truth, the most difficult hurdle for this proposed project is to find tax sources to pay for a new convention center that have not already been tapped out.

For example, if city and county governments (remember county government: it owns half the building) want to build a new $500 million convention center, it will have to find $30 million a year to cover its debt service, said tourism insiders. The primary funding source for a new facility would seemingly be from the Tourism Development Zone (TDZ), but as we explained recently, it is almost tapped out and there is little room for additional debt.

There is of course the potential for a Tax Increment Financing District (TIF), but again, it’s difficult to imagine that it could generate $30 million a year, and even if TIF and TDZ are stitched together, it still doesn’t appear to have the funding capacity to support a new center.

The Core Question

But a more fundamental question has to be answered before the money issue is even dealt with: Can a new convention center substantially improve our appeal as a convention destination?

We are at best now a third-tier convention city, and we have become a skeptical lot. After all, we were told that if we had a convention center hotel, it would make us a successful convention site. Then, we were told that we needed to expand the convention center. Then, we were told that we needed an expanded convention center hotel. Then, we…well, you get the picture.

This time, before we embark on a new project, we need definitive, conclusive proof that we can in fact move up to the top tier of convention cities and that we can in fact compete with our major rivals. It’s only after establishing that this can be done that attention should turn to the funding.

Location, Location, Location

Somewhere along the way, however, someone needs to consider what contractual entanglements must be resolved as well, particularly any agreements with the Marriott Hotel who significantly expanded the number of its rooms a few years ago with the promise of a bigger convention center.

There’s little argument that the convention center more logically belongs in the Peabody Hotel/Beale Street area. There’s equally little argument that the current convention center provides a dismal experience and is detrimental to any serious vision of Memphis as a convention destination.

Mayor Herenton said that no decisions have been made about where a new convention center could be built, and while the area from Fourth to Danny Thomas might seem the most likely choice, other possible sites are located to the east of Beale Street and also south of FedEx Forum.

Mixed Signals

While there is wide supposition that Mayor Herenton wants the convention center on Union Avenue, it's worth remembering that he opposed the placement of FedEx Forum there. In a tug of war with Shelby County Government – which favored the Union site – Mayor Herenton bested former Shelby County Mayor Jim Rout and had the new arena built where he wanted it.

But back to our original premise, just consider plans to expand Beale Street with new hotels and entertainment venues. It was widely known in downtown tourism circles that city government was anxious to remove John Elkington’s Performa management from the historic street and that Mr. Elkington was equally anxious to turn his attention to developments in other cities. In truth, it is in neither party’s interest in litigating the issue.

Beale Street Blues

Negotiations appeared to be going in a positive direction and predictions were that a new arrangement for Beale Street – complete with a new oversight group – would be announced by end of the year. With a flurry of subpoenas apparently designed to intimidate, Mr. Elkington is winning no friends in the tourism industry or in City Hall, and in upping the ante, he has made the deal much harder to reach.

Mr. Elkington’s supporters report that city government had a chance to seal the deal if it had moved ahead in good faith, while a city official said that he had overestimated his “nuisance value.” There are few elected officials who would have commented in the midst of such legal manipulations, so it's really no surprise that City Hall didn't comment and is following legal recommendations to fight a subpoena.

It’s too bad, because all the rumors about city operatives measuring buildings to jack up rents to pay for new development serve no useful purpose. Neither are they based on much logic, but then again, Beale Street is nothing if not a cocoon where rumors are rife and assumptions abound.

Symptoms Of The Political Disease

Meanwhile, some county commissioners remain reluctant to sell to City of Memphis their interests in The Pyramid and the Fairgrounds for $5 million. Although the transaction would be the ultimate protection against risk, several key county commissioners are suspicious that somehow the Herenton Administration will “take” them in the deal.

It’s symptomatic, because there’s no funding source being used on the Bass Pro Shops project at The Pyramid that would otherwise go to county government. The principal source of funds for the $30 million in so-called landlord improvements at The Pyramid is the TDZ, which captures sales taxes to pay bonds that would otherwise go to state and city governments.

One commissioner questions why there was once consideration of Bass Pro Shops paying property taxes. Whether you like Bass Pro Shops as the tenant in the former arena or not, it still makes more sense for it to remain public property. Any way, even if the building were subject to property taxes, we’re sure Bass Pro Shops would immediately ask for a lengthy tax freeze. Meanwhile, if someone is really concerned about this issue, the most graphic example is found in the hundreds of tax-free publicly-owned acres occupied by FedEx at Memphis International Airport.

Saturday, September 27, 2008

This Week On Smart City: Touching The Future Through Teaching And Planning

This week on Smart City: two different cities, two unique challenges. We'll speak with Ana Menezes and Lindsay Enters from the group TeachNOLA. The organization works to bring the best and brightest teachers to New Orleans and also helps talented people earn their teaching certificate to bring a high caliber of teachers to New Orleans Public Schools.

We'll also speak with Gabriel Metcalf of the San Francisco Planning and Urban Research Association, also known as SPUR. The organization has had a long history of helping San Francisco become the successful central city of California's bay area. We'll find out what role SPUR has had in the city's progress and what the future of the organization will be.

Smart City is a syndicated, weekly hour-long public radio talk show that takes an in-depth look at urban life: the people, places, ideas and trends that affect us all. Host Carol Coletta, president and CEO of CEOs for Cities, talks with national and international public policy experts, economists, business leaders, artists, developers, planners and others on the pulse of city life for a penetrating discussion on urban issues.

Smart City is broadcast at 6 a.m. Saturday and Sundays on WKNO-FM, but it is also webcast and podcast so you can listen to it anytime you like. For the webcast, times for the broadcast in other cities and to sign up for the podcast, visit our website.

Thursday, September 25, 2008

City Council Cleared Of School Assault Charge

Memphis City Schools Superintendent Kriner Cash and his educational émigrés are coming face-to-face with a fundamental reality of Memphis City Schools – our urban school system has operating systems that are anything but urban.

As a result, it has been difficult to have a high comfort level with almost any information it has produced, from enrollment numbers to data about teacher hiring.

As Superintendent Cash says, this is caused by problem employees that represent about 2% of the total workforce. We hope he’s right, but it’s hard to comprehend that 320 people out of 16,000 employees are responsible for a culture that traditionally chokes to death innovations of superintendents and waits them out.

Challenging Times

That’s not to say that Superintendent Cash and his right hand man, Irving Hamer, don't seem deadly serious about their intentions – much-needed, by the way – to shake the existing culture down to its foundations, and the 658,028 Memphians who are not MCS employees should be cheering them on.

Superintendent Cash also suggests that the student performance problems of Memphis City Schools are largely caused by 10% of the students, and again, we hope he’s right, although he’s spotlighted the fact that 30% of students are over age for their grades.

All in all, it’s the portrait of a daunting educational challenge, and it’s hard to think of a priority that’s more important to Memphis than solving them, because our low educational attainment rate is a persistent drag on our competitiveness.

It’s Talent, Stupid

In this way, Superintendent Cash’s responsibility is more than developing educational strategies. More to the point, he’s ultimately charged with developing our city’s primary talent strategies, and when you strip it all away, the single most important factor affecting Memphis’ future is talent.

Although Memphis City Schools officials are still smarting from what they felt was an ambush at Tuesday’s Memphis City Council meeting, that appearance was a stark example of how the newfound emphasis on accuracy can also result in political implosion.

Superintendent Cash’s statement that the student enrollment of Memphis City Schools is 103,000 caused City Council members’ jaws to drop, but it also caused some eyebrows to arch 210 miles away in state government, because of the suspicion that state funding has been based for several years on inflated enrollment numbers. (Meanwhile, the Memphis City Schools website alternately gives the enrollment at 119,000 and about 110,000, depending on which page you're reading.)

Candor And Caveat

One caveat: the enrollment given by Mr. Cash was the district’s so-called 20-day number, and typically, the 40-day enrollment number is larger, but it certainly won’t reach the 2007 reported enrollment of 110,753. As one state official pointed out, only a couple of years ago, Memphis City Schools reported 117,740 students.

“Maybe the student population has dropped almost 15% in three years,” he said. “Maybe it has. It just doesn’t feel right.”

Right or not, there was little benefit to Memphis City Schools from Superintendent Cash’s candor about the enrollment, but city school officials felt that it underscored how serious he is about dealing with “real numbers” and “honest accountability.”

Political Neutralizer

More to the point, his admission to City Council members that Memphis City Schools has been using inaccurate numbers in the past quickly changed the political calculus in the Council’s $66 million cut in school funding. After all, at the 2007 per pupil expenditure level of $9,254, that means that the district needs about $93 million less because of the drop in the number of pupils.

At the risk of saying we told you so, we wrote several weeks ago that between 2003 and 2007, according to Tennessee Department of Education officials, the enrollment of Memphis City Schools fell 11 percent; however, its budget grew 19 percent. Apparently, the gap was even wider.

All of this prompted a headline in The Commercial Appeal that seemed likely to defuse the political pressure on City Council members in the wake of its funding cuts. After months of dealing with angry emails and hostile phone calls, City Council could not have paid for a more powerful headline: “Memphis City Schools officials say fund cuts not a disaster.”

A Number Here, A Number There

Despite previous Memphis City Schools’ statements that 71 teachers and more than 100 administrators were laid off as a result of the city funding cut, Memphis City Schools officials conceded that the cut had not caused layoffs and the district’s budget actually increased from $931 million to $947.8 million.

Councilman Shea Flinn spoke for his colleagues – and most of Memphis – when he said: “Every time you come here, we get new data. We just don’t know what data to believe.” Doubtlessly, there are days when Superintendent Cash could likely agree with him, because clearly, no one has more experience in this phenomenon in recent months than him.

As the joke goes, if you ask six school administrators for enrollment numbers, you’ll get eight different answers. But the statistics given to Memphis City Council this week effectively blew away any remaining notion that Council action was detrimental to the students in our school district when they cut the city’s funding.

Apparently, finally, Superintendent Cash has announced the definitive enrollment number, and for a burst of candor that’s uncharacteristic for Memphis City Schools, maybe in its own way, that’s also a major assault on changing the district’s culture.

Wednesday, September 24, 2008

1984's Big Lie Typifies 2008 Campaign

We live in the Age of the Big Lie.

George Orwell saw it coming, but it took a couple of decades longer than he thought. Somehow, it seems appropriate that Ronald Reagan was president in 1984, because his administration gave voice to the Orwellian view:

“To tell deliberate lies while genuinely believing in them, to forget any fact that has become inconvenient, and then when it is becomes necessary again, to draw it back from oblivion for just so long as it is needed…”

In those days, it came in the form of the solemn promise that Americans could somehow have it all – and all while cutting taxes. In the end, it set in motion policies that would begin the greatest concentration of wealth and the greatest income disparity in history, all while creating more national debt that all previous U.S. presidents combined.


And yet, today, looking back, it almost looks quaintly naïve, compared to today’s default to The Big Lie. It’s never seemed as obvious as in the current presidential campaign season. Never have so many talking heads and candidates looked directly into the camera and lied – about each other, about the impact of their programs and about the ultimate beneficiaries of their policies.

It has become so blatant that both political parties have now abandoned politic-speak of the past when they talked about “untruths,” “misstatements” and “falsehoods.” Bluntness has been forced to the surface with both parties using the “l word” in responses to unsavory political ads that harken back to the tone of the campaign between Thomas Jefferson and John Adams.

Jefferson supporters described Adams as a “hideous hermaphroditical character, which has neither the force and firmness of a man nor the gentleness and sensibility of a woman.” In a counter attack, Adams’ advocates called Jefferson “mean-spirited, low-lived fellow, the son of a half-breed Indian squaw (and) sired by a Virginia mulatto father.”

Political Nostalgia

Things did eventually calm down with Jefferson being accused of being an atheist and a coward and Adams called a fool and a criminal. In a portent of things to come, Jefferson even hired a hatchet man to slur Adams, but without admitting that he was paying him.

It all seems nostalgic compared to what voters are subjected to today, as parades of talking heads on endless news programs repeat mindless talking points with a total absence of self-consciousness. The fact that the exact same talking points can shift back and forth between political parties (in what we affectionately call the “Bay Buchanan Syndrome”), depending on who’s in power, speaks to utter lack of honesty, not to mention consistency, in contemporary political discourse.

Ads today say that Senator John McCain favors a 100-year war while his campaign suggests that Senator Barack Obama’s only achievement in education was teaching sex education to kindergartners.

Lying For A Living

Both are unmistakably lies and becoming common place. PolitiFact.com has rated 22 statements and ads from Sen. McCain as barely true, 23 as false, and 6 as “pants on fire” false. For Sen. Obama, 14 have been rated as barely true, 18 false and 1 “pants on fire” false.

We deserve better, and yet the Big Lie rolls on:

“This $700 billion buy-out is to protect Main Street, not Wall Street.”

“He (Sen. Obama) will raise middle class taxes and the taxes of small businesses.”

“It is in the national interest to cut taxes in times of economic uncertainty to jump start the economy.”

“Reasonable people can disagree about the conduct of the war, but it is irresponsible for Democrats to now claim that we misled them and the American people…Saddam Hussein was a threat.”

Boundless Manipulations

The degree of manipulative distortion today seems to know no bounds, and at times, the war on terrorism appears more accurately to be a war on reason. It appeals to a vein of anti-intellectualism and delivers up the kind of simplistic answers in a complex world that too many people find comfort in.

Jingoism is an American tradition, but it’s hard to think of an era when the truth has been as effectively dispatched in pursuit of political gain. In his undisclosed location, it’s likely that the vice-president is still muttering that there’s a direct link between Al Qaeda and Saddam Hussein.

On the domestic front, tax cuts have fueled the bulging national debt, with some estimates that about half the debt since 2001 are for the redistribution of wealth to the richest among us. At the same time, the federal government abandoned its role as a supporter of capitalism to become its instrument.

Tipping Point

Hopefully, America’s eight years of the “ends justify the means” national leadership will someday only be seen an aberration, but its sibling, The Big Lie, seems destined to remain.

More and more, political messaging insults America’s central virtues – honest self-assessment – and it’s likely only American voters can bring it to an end. Hopefully, regardless of who wins this election, we have reached the tipping point, and in the post-Rovean world, it is exercised in an unmistakable message by refusing to vote for any candidate whose skills include The Big Lie.

Monday, September 22, 2008

Solving Old Problems Rather Than Grabbing New Land

Memphis is #5 with a bullet.

Unfortunately, it’s the list of the top 10 cities with the highest poverty rates. As alarming as that statistic is, it could be much worse if it wasn’t for Tennessee’s liberal annexation laws.

That’s because the 2007 poverty rate for Memphians is 26.2%, edged out by El Paso (27.4%), Buffalo (28.7%), Cleveland (29.5%), and perennial #1 Detroit at 33.8%.

But here’s the thing. Most of these cities are landlocked and cannot annex, and if Memphis contended with the same reality, it would likely be battling Detroit for the top spot. Even Newark, with problems that defy solutions, was three down from Memphis on the list with a poverty rate of 23.9%.

Curse Or Blessing?

It’s a troubling dilemma for our city, primarily because it shows no sign of improving, climbing from the 2000 rate of 20.6%. We wrote Sept. 3 about the deepening crisis reflected in the latest Census statistics, so we won’t belabor the point again.

That said, there are times when Tennessee’s annexation laws seem as much a curse as a blessing. Memphis’ annexations in the past 20 years have effectively masked the dimensions of the interlocking problems of poverty, perpetuating the myth that Memphis’ population and trends were largely moving in a positive direction.

On balance, there’s no question that Tennessee’s progressive attitude toward annexation is good public policy, largely because there is a direct connection between these kinds of annexation laws and the financial solvency of cities.

In other words, the pitfall is that often the prospects of annexation inspire a false sense of security in Memphis.

Job 1: Urban Core

That’s because city officials are able to prop up Memphis’ population and its tax revenues by taking in more and more territory. Without this ability to annex, Memphis’ population would likely be about half of what it is today, and the serious problems in the city’s midst could not be obscured by new taxes and new citizens (however reluctant they may be).

It seems a good time for Memphis to call a moratorium on its quest for new land and prove first that it has programs and strategies to address the cancerous problems of the urban core – the hollowing out of the middle class, the bipolar economic divisions, and the deterioration of too many neighborhoods.

When City Council weighs its decision on annexation by measuring whether it is a tax windfall or a tax drain, it’s a shallow evaluation, because the ultimate issue isn’t if city government can provide urban services to the annexation area. More to the point, it is whether city government can provide solutions to the critical problems gripping the urban core.

What is inescapable in annexation debates is the abject failure of the process set in motion by Chapter 1101, the state law calling for urban growth boundaries to be set in every Tennessee county. The purpose of that law was to encourage and require counties and the cities within them to sit down and cooperatively develop a blueprint for future land use.

Sham Urban Growth Boundaries

Here, that overriding intent was ignored, because state law also said Shelby County, Memphis, and the smaller municipalities could satisfy the law by ratifying their existing annexation agreements. As a result, there was never a serious discussion about growth management, protection of green space, and the community’s response to sprawl. Instead, the process was all about negotiating annexation agreements in keeping with previous contracts.

As a result of this process, all but 48.74 square miles (small pieces of land in the corners of Northeast and Northwest Shelby County) were identified as urban growth areas, meaning that Memphis, at 317 square miles at the time of Chapter 1101, would eventually swell to 489 square mile, about the same land area as Los Angeles.

Meanwhile, some rapidly urbanizing areas like Orlando and Seattle managed to inject some growth management strategies into their processes. In Seattle, local elected officials showed genuine leadership in adopting a different growth model for the region in the midst of rapid growth, a model that called for containing urban sprawl through the use of regional boundaries and a regional open space system; organizing urban development into compact communities; protecting rural areas by promoting the use of rural lands for farming, forestry, recreation, and other uses; providing a greater variety of housing choices in all parts of the region; and creating a regional transportation strategy that frequents on high-speed bus and rail transit.

In taking this action, Seattle altered the future of its region in a shorter period of time than any other metro in the U.S.

It’s All About Leadership

Meanwhile, here, annexation has been pursued with little regard for a long-term vision for the county, and as a result, Memphis runs the risk of strangling its future to death with the lure of new land and new taxpayers. That’s because without the counter-balance of growth management strategies, it’s hard to see a future that’s not more of the same – deteriorating neighborhoods, vast swaths of abandoned neighborhoods between downtown and East Memphis, fewer people paying more taxes and public services stretched thinner and thinner.

Of course, the same people whose policies have caused some of the problems can also change things for the better. At any time, Memphis City Council – blessed with new leadership unwilling to continue policies that fueled the sprawl that eroded the health of its own city -can set the standard for local leadership by stepping back, gaining some perspective, and convening a process to consider a different future for Memphis and Shelby County.

It’s hard to imagine any time in the modern history of Memphis where this brand of assertive leadership was more needed. The future is riding on it.

Sunday, September 21, 2008

MCS Improvement Demands Management And Manipulation

Educational experts disagree about the wisdom of creating schools for overage students, the strategy that’s a centerpiece of Memphis City Schools Superintendent Kriner Cash’s strategies to turn around the low-performing district.

There is no disagreement, however, on the wisdom of the move as a strategy for gaming No Child Left Behind.

It seems only logical that if some of the over age students who are dragging down a number of schools’ proficiency scores are concentrated into fewer schools, Memphis City Schools has a better chance to improve results under NCLB.

Facts Of Life

The same end game motivated Supt. Cash’s plan to recruit 2,000-3,000 college students who will act as tutors for 10 weeks for 9,000 elementary students who are performing one grade level behind. It will be just in time for state testing under NCLB.

Like it or not, NCLB is a fact of life in today’s public education. It’s not enough any more for a superintendent to manage teaching and learning. It’s equally important to manage, if not manipulate, NCLB so it shows improvement in the district and schools.

We haven’t always known that. Under former Supt. Carol Johnson, we were spoon-fed news releases from the district and the Tennessee Department of Education about the substantial progress that was being made by Memphis City Schools in getting schools off the state’s high-priority list.

Harboring The Truth

What we weren’t told in the midst of these celebrations was that more than 60 city schools were placed in “safe harbor” status, meaning that this sleight of hand misled parents and taxpayers into believing that students must be getting a good education if they were attending a school meeting AYP (Adequate Yearly Progress).

Safe harbor allowed Memphis City Schools to proclaim in its press release that "128 Schools (in good standing)… Most in NCLB History!" Meanwhile, then-superintendent Johnson said: "It is inspiring news for the Memphis community and all in our district to know we are closer to realizing one of our most important goals – for every school to be in Good Standing."

The fact that a sizable number of the schools were listed in good standing on a technicality went unmentioned.

The Road Less Traveled

As we’ve mentioned before, as a result of these kinds of announcements and revelations made in the wake of Ms. Johnson’s departure, the new superintendent confronts a much more jaded, if not cynical, Memphis public.

So far, Supt. Cash has not fallen into some of the same traps that eventually crippled Supt. Johnson’s effectiveness – the way the so-called Minneapolis Mafia isolated her, filtered information and blocked input, and the way that her staff established an alternate organizational chart rather than tackle the toughest task of all…changing the culture of the district.

Already, Mr. Cash has taken steps that indicate a different path. While he has brought in some Miami transplants in key positions – a couple of Millennium Group associates, including Irving Hamer (giving birth to the Millennium Mafia appellation), he also moved former academic director Alfred Hall of Memphis to chief of staff.

First, I Had To Get Its Attention

Also, he seems dead serious about transforming the district culture, based in particular on Mr. Hamer’s “take no prisoners” approach, which has been likened to the old joke about hitting the mule with a 2 X 4 to get its attention. If anything, it does appear that the Cash regime has gotten everyone’s attention. Now the test is to see if it can fundamentally change things, a task that has stumped a succession of superintendents.

Supt. Cash gives appearances of finding his rhythm, although the toughest sell of all is the private sector, which remains unconvinced that anyone can succeed in achieving significant progress at the district.

And yet, the new superintendent can’t be faulted for clearly stating what we should expect from him by next year and how we should hold him accountable. He pledged to cut the number of low-achieving schools in half, increase TCAP scores for African-American and Hispanic students by 6 percentage points, and increase the district’s ACT scores from 17.5 to 19. Meanwhile, he plans to open school-based “full-service parent centers” and “full-service health clinics” in each region of the district.

Imaginative Times

These last two ideas seem anchored in the idea of schools serving as centers of neighborhood, and there’s no question that this is a valuable objective. But, to accomplish this will require serious cooperation from the public sector, which is beset with its own financial pressures. In fact, Supt. Cash’s concepts are progenitors of earlier, similar initiatives that became victims to the budget axes of city and county governments.

The national context in which Supt. Cash’s work is cast is nothing short of unimaginable just a few years ago.

Chicago Public Schools chief Arne Duncan is looking to pilot boarding schools for students in September, 2009. Other cities are looking at restructuring their districts into mayor-led ones as New York City Mayor Michael Bloomberg extolled the virtues of mayoral control as school began in his city. A handful of cities are experimenting with ways to hire teachers from the top third of college graduates rather than the bottom third.

The Cash Context

Meanwhile, here, Supt. Cash has a grab bag of programs aimed at elevating expectations and improving performance at Memphis City School. And if there are guiding principles for his ideas, it’s probably these:

• Designing innovative platforms to replace existing practice is the key to radical change within one year.

• Turnaround strategies must center on teaching and learning.

• Structural changes are at the heart of urban school transformation.

• Redeployed resources are critical to sustaining turnaround after the first year of change.

• Collaborations between the community and the district are vital to eliminating low performance.

• School turnaround requires responses to all of the conditions that contribute to underachieving students.

• Increasing the application of technology can reduce the time that teachers lose with paperwork and reports.

• Stepping up the rate of achievement requires greater involvement of parents, families and communities.

These principles essentially represent the approach that proved effective in Miami. There’s no reason to expect that they aren’t the context for the Cash era and will produce similar results in Memphis.

Saturday, September 20, 2008

This Week On Smart City: Turning Vision Into Action

How do you find out what people want for their city? Sometimes, you just ask them.

John Lewis
is the president of Intelligent Futures and leader of Imagine Calgary. Imagine Calgary asked citizens four key questions to find out what Calgarians sought for the future of their city. The discussion took place in person, online, and more than 18,000 residents contributed their ideas. The result is a 100 year vision for Calgary.

Based on Calgary's success, Portland, Ore., adopted a similar idea. Through the office of Mayor Tom Potter, Liesl Wendt helped create Vision PDX to help shape the future of Portland.

Smart City talks with John and Liesl to learn how looking into the long future, the 100-year future, is not an impossible reach for cities.

Smart City is a syndicated, weekly hour-long public radio talk show that takes an in-depth look at urban life: the people, places, ideas and trends that affect us all. Host Carol Coletta, president and CEO of CEOs for Cities, talks with national and international public policy experts, economists, business leaders, artists, developers, planners and others on the pulse of city life for a penetrating discussion on urban issues.

Smart City is broadcast at 6 a.m. Saturday and Sundays on WKNO-FM, but it is also webcast and podcast so you can listen to it anytime you like. For the webcast, times for the broadcast in other cities and to sign up for the podcast, visit our website.

Thursday, September 18, 2008

Paying For Big Projects Is Taxing Experience

Nothing is quite as confusing as government financing, and that’s never been truer than now.

There seems to be big numbers every where - the $30 million for The Pyramid, there’s the idea of a new convention center likely to cost at least $500 million, there’s the tens of millions of dollars for Liberty Bowl Stadium improvements, and then, there’s the $66 million cut in funding for Memphis City Schools.

There are times when even insiders in government get confused by the blizzard of numbers, funding sources, legal restrictions and potential uses. That’s why it’s easy to understand why the Letters to the Editor use these numbers as if they are interchangeable.

Of course, they can’t be.

Here A Tax, There A Tax

There are property taxes that are paid by all Memphians who own property. Memphis has the highest cumulative city-county tax burden in the state, and both city and county governments have heavy dependency on property taxes, which fund the majority of city and county services (half of the county's property taxes go to schools).

There are sales taxes collected every time we make a purchase in Memphis – 7% of it goes directly to Nashville and the 2.25% local option sales tax stays here. Half of the local option sales tax goes to the general fund of city government and the other half goes to public education.

There are the hotel-motel taxes that are added to the bills for rooms in Memphis hotels. Shelby County Government has a hotel-motel tax of 5% and City of Memphis has a hotel-motel tax of 1.7%. They are used to fund the Memphis Convention and Visitors Bureau and to pay off the bonds on the Memphis Cook Convention Center.

Alphabet Soup

There’s the Tourism Development Zone (TDZ) which takes in most of downtown. In this district, the incremental increase in sales taxes created by a tourism-oriented project is collected and used to pay off bonds issued for that project. Some TDZ’s collect all of the sales tax while others can only collect 45% (excluding the portion for public education). Another TDZ is likely to be created to fund infrastructure improvements for the Fairgrounds mixed-use development.

There’s Tax Increment Financing (TIF) which collects increases in city and county property taxes that take place following infrastructure improvements in a specified area. A baseline is set and anything above that baseline can be captured to pay for public improvements. Uptown is largely funded by a TIF district.

There’s the Payment-in-lieu-of-taxes (PILOT) program that freezes property taxes at the amount of the unimproved property, and as the property is improved and its value increases, additional taxes are waived for a certain number of years. Memphis and Shelby County have handed out more tax freezes than all metropolitan areas of Tennessee combined. PILOT’s are granted by the Industrial Development Board for new businesses and expansions and the Center City Revenue Finance Corporation for downtown projects.

And There’s More

There’s the Center City Commission’s PILOT extension fund that pays for bonds issued for parking facilities.

There’s the state sales tax rebate that collects the sales taxes from the sale of tickets, concessions and merchandise at the games of professional sports teams. This funding was used at FedEx Forum and Autozone Park.

And these are just a few of the taxes collected and spent by our governments. Some taxes can only be spent for certain things – such as a convention center, an arena or street improvements. As a result, they are not interchangeable, but they often allow projects to proceed without property taxes.

Pyramid Scheme

As a result, we pity the average citizen as they try to sort through all of this and argue that the $30 million being spent on new parking garages and street improvements at The Pyramid should be given to Memphis City Schools to make up part of the $66 million cut.

The same sort of argument was heard when the FedEx Forum was approved, but the truth is that the taxes being used to pay for both of these projects can’t be spent on education. By law, they can only be spent for specific projects like a facility for a professional sports team.

To complicate things even more, the money being spent at The Pyramid is capital improvement program funds. The yearly payments for bonds are about $70,000 for each $1 million of debt. In other words, the $30 million for street and parking improvements at The Pyramid would require yearly payments of roughly $2.1 million.

Even if they wanted, city and county governments could not redirect these revenues to schools, whose capital funding normally comes from property taxes.

Confusion Reigns

Or said another way, if the state law did allow this money to be redirected, it would not be $30 million sent to schools. It would be $2.1 million, hardly making a dent in the reduction in school funding. That’s because the annual payment on the bonds is about $2 million. That’s the amount that could be moved, not the $30 million in infrastructure improvements.

Are you totally confused?

Well, what about the suggestion about a new convention center.

It’s estimated to cost at least $500 million, and it could easily be more. Some ardent opponents of the cut in school funding immediately said that if city government could spend that much money on a convention center, it should give Memphis City Schools the $66 million that was cut.

Hurdles Galore

But like The Pyramid (and FedEx Forum, for that matter), the funding sources that are available to pay for a new convention center – TDZ, TIF and hotel-motel taxes – cannot be spent on schools.

After straining these revenue sources to pay for FedEx Forum, it’s difficult at this point to imagine how there would be enough revenue to pay off $500 million in bonds, whose yearly debt service would be about $35 million a year.

In the end, finding that amount of money is the single greatest hurdle for the project to clear. Already, Memphis Mayor Willie W. Herenton – reprising comments about the Bass Pro Shops at The Pyramid – has said that no general fund or property tax money will be used for a new convention center.

Nothing Decided

Actually, on this one, we agree with Mayor Herenton that there’s no downside to considering whether a new convention center is needed. He promises that no decision has been made, and most encouraging of all, he suggests that before his special convention center committee should consider what to build, they need to determine Memphis’ competitive context and if there is any realistic way to move it from being a third-tier convention destination to the top tier.

It’s a question that requires complete honesty and the setting aside of special interests and preconceived notions by every one on the Herenton committee. After all, cities across the U.S. have chased conventions for years by building new convention centers, then building convention center hotels, then expanding the convention center, then expanding the hotels, etc., and yet, their relative place among convention centers remained the same.

The First Step

So, before anything definitive is decided, the first task is to determine what Memphis really needs and what results are realistic. It should be an open and candid discussion – keeping in mind the arguments by advocates in the tourism industry and the warnings by the Brookings Institution that cities are wasting money in the mushrooming convention centers.

This time at least, Mayor Herenton appears willing for this kind of serious, thoughtful analysis and evaluation. If there is to be a new convention center, at least, Memphians will be reassured that this time the answer to making Memphis a top-tier convention center isn’t preordained.

Tuesday, September 16, 2008

Milken Report: Another Wake-Up Call

Memphis needs some “leap frog” strategies to get more competitive in the knowledge-based economy.

Just how badly we need the strategies was underscored in the past few days with the release of the highly-regarded annual report by the Milken Institute: “Best-Performing Cities 2008: Where America’s Job Are Created and Sustained.”

The Memphis metro wasn’t in the top 100. Worse, we weren’t even in the top 5 in Tennessee.

In fact, Memphis moved down three spots from an already bleak position – from #141 to #144.

Down The List

Meanwhile, in our state, the metro areas of Nashville (#22), Clarksville (#51), Knoxville (#60), Chattanooga (#110) and Kingsport/Bristol (#128) finished ahead of Memphis in the large cities category.

Memphis has been languishing in about the same position for years, while other cities prove that you can come up with game changers to improve your performance. For example, the most-improved metro was El Paso, which moved up 85 positions, and in Tennessee, Nashville moved 39 positions to get into the Top 25.

“The Best-Performing Cities index was designed to measure which U.S. metropolitan areas are most successful in terms of job creation and retention, the quality of jobs being produced, and overall economic performance,” the report introduction said. “Specifically, it pinpoints where jobs are being created and maintained, where wages and salaries are increasing, and where economies and businesses are growing and thriving.”

Lagging Indicators

The report is often used by the private sector to evaluate locations for new businesses and expansions, and on the public sector side, officials use the rankings to identify strategies that are needed for economic development. The rankings were comprised of jobs growth, wage and salary growth, short-term job growth, relative high tech GDP growth, high-tech GDP location quotient, and number of high-tech GDP LQ>1.

Memphis did not finish in the top 100 in even a single category, and in the number of high-tech GDP, Memphis was #181, which seems to be the highest hurdle that we need to clear.

It shouldn’t have been this way. Memphis was the first city to apply the research of Richard Florida (before he’d even published his now-famous book on the creative class) in an effort to develop a city that attracts and retains creative workers. Then, Memphis Manifesto Summit (now printed in Dr. Florida’s book) convened 135 “creatives” in our city to write their manifesto for cities seeking them as citizens and workers. Finally, the first research about 25-34 year-olds and recommendations for cities seeking them began here (in collaboration with Portland economist Joe Cortright).

Losing Ground

Unfortunately, none of these gained traction in Memphis at the same time that some of its competitors were using them for new programs aimed at creating the kind of vibrant, tolerant city that attracts these workers.

Today, the stakes are even higher. The maps for the National LambdaRail and Internet2 indicate that Memphis is being bypassed by these future-altering optic networks that will serve the interests of research through cutting edge technology. When these maps are coupled with the maps for the megapolitans that will become the economic engines for the U.S., it is clear that Memphis runs a disturbing risk of being in the backwater of the knowledge economy.

In other words, some of the cities on the path of these technology networks already rank above us and the gap is likely to get even larger. It’s a potential future that should shake us out of any vestiges of civic lethargy and develop an actionable plan to get on the emerging network grid.


While being part of these networks is important for business, they are also important to our community, because as John Seely Brown said in his presentation to Leadership Memphis a couple of years ago, success comes to the city that can harness the collective intelligence of the community and enable every one to be involved and contribute.

In this way, the priority for Memphis isn’t just to attract new talent, but to move more Memphis City Schools students to graduation and college and into the workforce with the skills to compete in the New Economy. It’s not a pipe dream, but it is a dream that requires public and private sectors to concentrate on strategies that result in a creative culture that sparks innovation and entrepreneurship.

In his research, our colleague Joe Cortright has spotlighted three characteristics that play key roles in knowledge-based economic advancement - entrepreneurship and risk-taking, tolerance for new ideas, and differences in tastes and behavior.

Premium On Ideas

In an economy that will be driven by ideas, cities that can shed the status quo and embrace change are the cities that will succeed. There’s no reason that Memphis can’t be one of them, especially considering our long tradition of entrepreneurship and the way that outsiders created the musical heritage we now tout to the world.

Eight years ago, CEOs for Cities identified the factors that should be the beginning point for cities like ours who are looking to succeed in the New Economy.

They remain as relevant to Memphis today as they did then, because they are still priorities demanding our immediate attention.

11 To Remember

These then are our 11 Commandments:

* Know Your Region

* Stop Trying to Get Bigger: Try to Get More Prosperous

* Stop Trying to Get Cheaper; Try to Get Better

* Develop a Vibrant Technology Infrastructure

* Create a Skilled Workforce

* Create a Great Quality of Life

* Foster a Culture of Innovation

* Reinvent and Digitize Government

* Recruiting and Retaining Talent is a Critical Factor to a Region’s Economic Success

* Quality of Life Matters

* Knowledge Workers Cluster Together

In Memphis, we’ve talked about some of these for a decade. Hopefully, in the next decade, we’ll work more on converting the rhetoric into results.

Sunday, September 14, 2008

Tomb Doomed More Than $10 Million In Property

The Pyramid is more empty than we even thought it was.

Memphis City Councilman Bill Boyd recently toured the arena and learned that many of its “furniture, fixtures, and equipment” are missing. According to one person who has walked through the vacant building, “It looks like locusts went through it.”

Gone are thousands of chairs, dozens of televisions and mini-refrigerators, concession stands' equipment, and expensive kitchen equipment. Mr. Boyd was quoted as saying that as much as $1 million in public property is missing, and there’s no record of who moved it and where.

We’ve been told that some of it has been moved to the Memphis Convention Center and the Shelby County Correction Center, but that the accounting is incomplete. There are even unsubstantiated reports that some of it ended up with local nonprofit organizations, however, there are strict legal procedures, particularly at county government, for doing this, and there’s no record of this happening.

SMG, manager of the Memphis Cook Convention Center and The Pyramid, is preparing a report for Councilman Boyd, and they say they have a list of items that were removed, but it’s pretty hard for a management company – that depends on its relationship with city and county officials – to ride herd on its bosses if they want to remove equipment.

Actually, although it was reported that the missing items were worth as much as $1 million, the estimate is at least missing a zero. A conservative estimate of the cost of the items is more than $10 million, and the expansive, hotel-quality kitchen made up much of that amount.

Do As I Say, Not As I Do

Former Tennessee Senator Fred Thompson has formed a political action committee that will financially support candidates “who believe in limited government.”

The senator – the most underperforming Tennessee senator in 30 years – said he is now on the look-out for high-performing candidates who share his conservative bona fides.

As for us, we wish him well. We just wish his notion of “limited government” included getting the federal government out of the reproductive decisions of women, arguing against the Supreme Court decision that established the right of privacy, and removing the federal government from a decision on what constitutes marriage and the myriad other ways that he has supported the expansion of federal government authority and activity in our lives, particularly in the erosion of our Constitutional rights in the name of homeland security.

It’s one of the curious realities of the Republican Revolution. After years of decrying government bureaucrats and liberal judges (although the majority of federal judges was appointed by Republicans) for intruding into the lives of Americans, once they gained power, they did the same.

Ignoring Consultant Costs $100 Million

Sometimes, local government really ought to pay attention to its consultants.

Yes, there are times when there’s really no downside, but we can think of one whose price tag is $100 million.

That was how much city and county governments spent on the expansion of the Memphis Cook Convention Center after their consultant said to move it in the vicinity of the Peabody Hotel.

Good Advice

The consultant – Price Waterhouse, as we recall – took an exhaustive look at the Memphis convention center roughly 10 years ago in light of market forces, trends and competitive context. Memphis and Shelby County Governments – which pay for convention facilities with some of the nation's highest hotel-motel taxes – wanted advice on whether it should expand the existing convention center or build a new one altogether.

After months of analysis, the consultant’s recommendation was given forcefully: don't expand, but rather, build a new convention center near Peabody Hotel and Beale Street. Essentially, the conclusion was based on a simple premise – build where the people are rather than try to make them come to the uninviting area of the convention center.

At that time, city and county officials could not fathom abandoning the area within years of The Pyramid opening its doors, and the officials contended that the convention center was anchor for the businesses in the Pinch District and it couldn't be moved. In response, the consultant said there would never be enough critical mass to make the convention center area more appealing and that with most of the tourist activities on the other end of downtown, it requires too much effort for visitors to enjoy them.

Budget Buster

In the end, city and county governments refused to yield in their opinions, and they confidently embarked on the budget-busting expansion of the convention center. Before it was over, lawsuits had been filed on all sides and the cost of the project ballooned to about $100 million.

While the convention center expansion was not one of government’s shining hours (whether making the decisions or supervising the construction), the cost of the expansion compounds the hurdles facing the new committee appointed by Mayor Willie W. Herenton to consider what it takes for Memphis to become a more competitive convention market.

One thing for sure: their deliberations would be a lot easier if $100 million wasn't tied up in the expansion, because it would be a big piece of the budget of a new convention center estimated to cost approximately $500 million.

Bunker Mentality (And Architecture)

Equally obvious in retrospect, the expansion did little to soften the bunker architecture of Memphis Cook Convention Center or to enhance the experience of convention-goers.

To complement its fortress appearance or because of it, the convention center remains drab and dreary and predestines Memphis to remain a third-tier convention city.

In a world characterized by stylish, airy, light-filled convention centers, Memphis Cook Convention Center is a throwback to another age. Its expansion – setting aside the fact that it cost twice its original projection and took twice as long to complete – does little to offset the gloomy interior and the gloomier meeting experience in the convention center, and in truth, the Cannon Center for the Performing Arts – as much of an upgrade as it was from the old auditorium - is equally meager when compared to similar halls in other cities.

It’s hard to imagine at this point how local government could find enough revenues – about $30 million a year – to pay off $500 million in bonds to fund construction of a new center. Most sources - hotel-motel taxes and the tourism development zone - were essentially maxed out with construction of the FedExForum.

That's why there’s no denying that the $100 million spent on the expansion of the convention center would come in particularly useful about now.

Alaskan Haters

A couple of weeks ago, we suggested that Memphis Mayor Willie W. Herenton apparently was overqualified to be vice-presidential candidate for the Republican Party.

Perhaps, we were too hasty.

We just read that when Alaska Governor Sarah Palin is criticized, she too refers to her enemies and critics as “haters.” Perhaps, she and our mayor have more in common than we thought.

Less Than Half Of MCS Employees Are Teachers

In announcing recent layoffs, Memphis City Schools’ officials said that the district has 7,000 teachers.

On its website, it says that its total number of employees is 16,000.

In other words, there are 9,000 employees that are not teachers.

It would be instructive to see a breakdown of all employees, because on paper, it sure sounds like the city school district has plenty of cuts that can be made before it would ever have to job cuts for teachers and people delivering essential services like mental health.

Last week, one of the school district’s officials said that every time 25 students enroll, it allows the hiring of one new teacher. But if that’s the case, doesn’t it mean that with 7,000 teachers, the district is staffed up for 175,000 students (rather than 113,000).

We’re sure that’s not the case, but we’re equally sure that nothing is ever simple when it comes to Memphis City Schools.

Friday, September 12, 2008

Word Of The Day: Resilient (September 11, 2008)

The following is a commentary from Charles Santo who teaches at University of Memphis. He moved from Portland, Oregon, to Memphis about three years ago, and his fresh perspective and insight into our city are affecting key issues that we often discuss often.

Here's his post:

Intertwined with other more obvious concerns in the aftermath of 9/11 emerged a new set of worries about the future of cities and urban form. Prior to that day, urban planners and economists considered the primary threats to the advantages of proximity that made dense urban concentrations work to be the declining cost of moving goods and people, along with advances in information technology. But discussions of the impact of telecommuting on urban form were suddenly replaced with dialogues about the impact of terrorism.

Many worried that refugee firms displaced by the loss of office space in lower Manhattan would never return from the places they had moved to in New Jersey or Connecticut. Others (including noted urbanist James Howard Kunstler) argued that the lesson of the day was that skyscrapers were inherently dangerous (and unnecessary), or that density itself put people in harm’s way. For safety’s sake, don’t bunch up,” urged historian Steven Ambrose.

“In this age of electronic revolution… it is no longer necessary to pack so many people and office into such small space as lower Manhattan. They can be scattered in neighboring regions and states, where they can work just as efficiently and in far more security.” (For more overt “sprawl as defense” arguments go here or here. For a response, go here.) Some worried about the impact of hardening security on the culture of city life. Perhaps surveillance would erode freedoms and encroach on public spaces to the point of stifling the interaction that helps makes cities vibrant.

A feeling emerged that these new concerns might team up with the effects that had previously been chipping away at the benefits of proximity, exacerbating the diffusion of density and the transformation of urban form. At the time there was broad public discussion of whether cities as we knew them might be doomed.

Before we ever considered whether these fears were founded – before we could sift through the data that emerged in the months and years following the 9/11 attacks that would empirically describe the impacts of terrorism on urban form – we collectively stopped thinking about the issue. Life went on, and after a period of thinking about the impact of 9/11 on everything, we simply stopped.

If you want read about the impact of terror on urban form from an empirical perspective, the best place I’ve found to start is Peter Eisinger’s “The American City in the Age of Terror: A Preliminary Assessment of the Effects of September 11,” from the September 2004 issue of Urban Affairs Review. Eisinger gives a thorough review of academic thought about the future of cities in the period immediately following the attacks. Then, presenting evidence regarding the impact of the attacks on urban government and policy, urban economies, and city life, Eisenger explains why many of our immediate fears were unfounded. Eisinger concludes that “perhaps the biggest lesson so far about cities in the aftermath of the terror attacks is that they are resilient.”

And that is the word of the day: resilient. You can read it in Howard Chernick’s 2005 book Resilient City: The Economic Impact of 9/11. You can read it Lawrence Vale and Thomas Campanella’s The Resilient City: How Modern Cities Recover from Disaster. And you can read it James Harrigan and Philippe Martin’s “Terrorism and the Resilience of Cities,” which appropriately concludes, “the forces that lead to city formation also enable cities to be highly resilient in the face of catastrophes such as terrorist attacks, because they constitute a force for agglomeration that is very difficult to overcome.”

The benefits of proximity prevail, for now.

Thursday, September 11, 2008

This Week On Smart City: New Ways Of Exploring Cities

This week on Smart City, Scott Bernstein is the president of the Center for Neighborhood Technology where he has developed the Housing and Transportation Affordability Index. We'll speak with Scott about the true cost of commuting and the toll it takes on your wallet and your time.

What's the pulse of your city, 24 hours a day? Next American City aims to find out. The magazine's 24 hour cities project has participants scouring a variety of cities for an entire day scouting out the best things to do every hour. We'll talk with Editor Diana Lind about her magazine staff's upcoming trip to Milwaukee.

Plus: Dog and Pony is a theatre company that has created a different way to explore a city with the Sound City Project. It's an interactive theatre piece that draws attention to movements and participants in Chicago's political history. Audience members use a map to guide them to locations and then listen to poetry, audio art, music and radio drama that interprets the artists' favorite locations in the city.

Smart City is a syndicated, weekly hour-long public radio talk show that takes an in-depth look at urban life: the people, places, ideas and trends that affect us all. Host Carol Coletta, president and CEO of CEOs for Cities, talks with national and international public policy experts, economists, business leaders, artists, developers, planners and others on the pulse of city life for a penetrating discussion on urban issues.

Smart City is broadcast at 6 a.m. Saturday and Sundays on WKNO-FM, but it is also webcast and podcast so you can listen to it anytime you like. For the webcast, times for the broadcast in other cities and to sign up for the podcast, visit our website.

Wednesday, September 10, 2008

Finding A Better Way To Fund Schools

There’s encouraging new momentum for a more rational approach to funding public education, and before it ends, we hope it won’t be déjà vu all over again.

In our April 27 post, we said that the decision by Memphis City Council to cut school funding could be the catalyst for a progressive, new look at school funding, specifically making Shelby County Government the source for all educational funding in our community.

It appears that this new look is about to take place, building on Shelby County Commissioner Mike Carpenter’s fine work to spark a new conversation about school funding. We wrote recently about the wisdom in the conclusions of that process, so we won’t go into detail again here, but suffice it to say, single source funding is the centerpiece of the recommendations.

Eternal Hope

In an equally encouraging sign, new Shelby County Board of Commissioners Chair Deidre Malone now has set the creation of a fast-tracked new school funding structure as a priority for her one-year term. Her stepped-up schedule calls for recommendations that can be presented to the Tennessee Legislature when it convenes in January.

That ambitious timeline requires unprecedented cooperation and collaboration in the intergovernmental family, but we admire the commissioners for trying. While our personal preference would be to eliminate the daylong summit – which here has too often become the substitute for real action – and move directly into real meetings to develop a plan, hope springs eternal with us on this issue.

Hopefully, this time around, single source funding will finally be an idea whose time has come. But if the past is the best predictor of the future, we need to keep our expectations low.

Three Strikes

After all, there’s been at least three other times that a process has been launched to move toward the same destination, dating back to when Bill Morris was mayor of Shelby County. Each time, the process derailed over the inability of some key partner to set aside their own special interest and act in the best interest of the community as a whole.

A couple of times, it was Memphis City Schools that became the obstacle that could not be overcome, but in fairness, its concerns were that a new formula might not provide the extra funding needed for education of at-risk students. On another occasion, the obstacles came from so many directions that they could never find a middle ground and the process collapsed.

Last time around, the discussion was propelled by Memphis businessman Russell Gwatney, whose grasp of the issue surpassed most people in the public sector. Because of his leadership, the Memphis Regional Chamber strongly supported single source funding for both school districts and the administration of then-mayor Jim Rout convened a process of key partners to hammer out an agreement. The committee met for months and despite the shared priority of single source funding, it could never resolve concerns from the school districts.

A Better Way

Back then, Mr. Gwatney (to whom we extend our condolences upon the tragic recent murder of his brother) pointed out correctly that tax revenues could not keep pace with the rapid expansion of operating and capital expenditures for schools. From 1994 to 2000, he said, the combined spending for both school systems increased $555.5 million, an increase for city schools of 75 percent and 61 percent for county schools.

He also honed in on ADA (Average Daily Attendance) requirements that called for county government to send a proportional amount to the city district every time a new county school was built, meaning that a $30 million county school resulted in about $70 million going to city schools.


To address these problems, Mr. Gwatney laid out the following recommendations:

* Establish county government as the single source of funding for operations and maintenance of city and county schools districts

* Establish a city-county school construction authority to oversee all capital construction projects for both districts

* Establish two capital improvement districts for city and county schools, and each district would be responsible for any debt issued on its behalf.

* City and county school boundaries would be frozen for 13 years (one educational cycle)

* Establish strong systemwide accountability and performance standards

* Support passage of half-cent sales tax increase dedicated to the capital improvement of schools

* Eliminate the ADA requirements for school construction

Moving Toward Fairness

Some of these recommendations resurfaced in the final report by Commissioner Carpenter. In the past, despite general agreement on the philosophy, it’s been impossible to agree on the principles for making it happen.

As we’ve said often, the lack of tax equity for Memphians is reason enough for City of Memphis Government to end funding for schools that began 70 years ago when rural schools were given preferential treatment and funding by Shelby County Government. Today, this city funding is fundamentally unfair and inequitable.

Hopefully, this new process will be a major step forward in leveling the tax playing field, and if Chair Malone and Commissioner Carpenter can be successful, perhaps, it will just be the beginning.

If we’re really lucky, maybe, just maybe, the success in improving school funding would inspire a new look at the unfair tax burden of Memphians generally. With a majority of commissioners representing Memphis taxpayers, there’s no public body more appropriate to analyze the tax fairness issue, and to determine if some other services funded twice by Memphis taxpayers could also be services that need single source funding.

Tuesday, September 09, 2008

Crisis At Schools Could Give Birth To Progress

A crisis is a terrible thing to waste.

It’s a quote attributed to a well-known economist, but it’s particularly timely for Memphis City Schools. Confronted with reduced public funding, a crisis in student performance and a management system in disarray, new Superintendent Kriner Cash has an unprecedented opportunity to not only put his stamp on our district, but to set a bolder direction that will guide it long after he has moved on.

The reality is that because of the crisis at the district, Mr. Cash essentially has a free hand to experiment, to innovate and to re-imagine a different kind of district for our city.

Redefining Success

That’s why we need to elevate our aspirations. Gone is a definition of success that means that the city district is operating better than at anytime in recent history. In its place should be a definition of Memphis City Schools as a national model.

This kind of attitude in Washington, D.C., has already resulted in the closing of 23 schools, replacing more than 40 principals and assistant principals and dismissing 100 central office staffers (in a system about half the size of ours).

The truth is that one year from now, there will be exciting headlines chronicling dramatic improvement at Memphis City Schools as it relates to TCAP scores and No Child Left Behind standards.

Yearly Gains

We don’t want to trivialize it, because it will be a major step in the right direction, but significant improvement at the 12-month mark is a regular feature of new reform-minded superintendents. In fact, we can all remember these kinds of headlines when former superintendent Carol Johnson, with accompanying hosannas, sliced the number of failing schools.

Recently, Washington Post lauded the impressive gains (students raised their overall scores on standardized tests by about nine points) that resulted from the “take no prisoners” reform philosophy of new District of Columbia’s Superintendent Michelle Rhee. Similar progress is reported at districts headed up by “marquee” superintendents around the U.S., and there’s little reason to suspect that Superintendent Cash doesn’t belong in that group.

After a somewhat sputtering start, Mr. Cash seems to be getting his balance, and most of all, he seems to be getting the message right – away from justifying new hires from Miami to articulating priorities to turn the district around and away from reams of strategies to focused levers of change.

No Rose-Colored Glasses

Through no fault of his own, he’s parachuted into one of the most cynical environments for public education anywhere. While he faces his own share of internal district challenges, there is nothing as malignant as the wide-ranging external opinion that nothing can be done to “fix” Memphis City Schools.

It’s an attitude that was deepened after the departure of Dr. Johnson to the greener pastures of Boston. It’s clear now in hindsight that the Johnson Era was as much an exercise in wishful thinking as anything, and we admit our own culpability in that delusion. In the end, we all wanted so hard to believe that she was making the fundamental improvements that could turn around the district that we became willing subjects for civic hypnotism.

This time around, we are clear-eyed, almost fatalistically so, but it is in this environment that Superintendent Cash will find almost anyone in this city ready and willing to help if he can promise the kind of courage and candor that can transform a culture that strangles innovation, suffocates dissenting opinions and resists opinions from anyone who threaten the status quo or the patronage and nepotism that lie behind too many decisions.

New Reality

The bad news is that we’re more cynical. The good news is that there’s little misunderstanding now about the fundamental nature of urban school reform – it is gritty, long-term work. There are no magic bullets. There are no simple answers. There is no alchemy to school improvement. There is only the alchemy of systemic, long-term, grind-it-out work.

That’s why the ultimate test isn’t in one-year testing results, but in subsequent years where only systemic change can produce the desired outcome. After all, several of Mr. Cash’s strategies are already destined to produce significant improvement, such as the movement of large numbers of overage students into a few schools rather than being spread across the entire district. It’s the kind of carefully choreographed program aimed as much at improving test scores through the movement of students as the movement of grades upward.

Such is the nature of school districts in the cruel landscape of No Child Left Behind, where a “teach to the test” imperative derails the need to add reasoning as one of the “R’s” in our schools if students are to succeed in the knowledge economy.

Finding Focus

The systemic work envisioned by Supt. Cash is coming into focus. We’re encouraged that he’s kept the rhetoric about the budget cuts by Memphis City Council to a minimum. The truth be told, he knows that he can make the required cuts without any damage to classroom instruction. Any urban superintendent worth his (or her) salt has already been faced with serious budget shortfalls and has developed the necessary budgets to protect classroom teaching. (In fact, that was one of former Supt. Johnson’s accomplishments in Minneapolis and now in Boston.)

School officials these days talk about reaching the tipping point for Memphis City Schools, and the blueprint is “Breakthrough Leadership: Breakthrough Results” plan authored by Deputy Superintendent Irving Hamer – who is driving so many key decisions – and Mr. Cash. While it’s difficult to see the tipping point, at least it’s several steps in the right direction.

The plan calls for moving half of the 8,609 students below proficiency in TCAP math, half of the 6,495 students below proficiency in TCAP reading and half of 4,236 students below proficiency in Gateway algebra. In addition, they say the striving schools will be reduced from 19 to 8.

Moving Targets

It won’t be easy. As we wrote the other day, in 80% of city schools, more than 30% of students change schools each year, and more than half of the students in 11 schools move each year. Teaching in urban districts is tough enough in the best of times, but nothing is harder than trying to hit the moving targets of Memphis City Schools.

After the Cash Administration lays the organizational foundation for 12 months of dramatic change, they will place their emphasis where it belongs – on teaching and learning. If there’s one resounding mantra these days in education, it’s that improving teacher quality is top priority. Research is incontrovertible that the quality of a student’s teacher is a greater influencer on a student’s achievement than anything else.

That’s why the words of Sir Michael Barber, the senior educational adviser to former British Prime Minister Tony Blair, caught our attention. He said that four great school systems in the world – Finland, Singapore, South Korea and Alberta, Canada – have one thing in common:

“They all select their teachers from the top third of their college graduates, whereas the U.S. selects its teachers from the bottom third of graduates. This is one of the big challenges for the U.S. education system: What are you going to do over the next 15 to 20 years to recruit ever better people into teaching?”

Passing The Test

That’s the main test for Memphis City Schools. If Supt. Cash is to make the most of the crisis atmosphere of the district, he should invest his ammunition in the area of teacher quality. Union considerations aside, it’s time to find a way to get rid of poor-performing teachers who just have the virtue of seniority but little else, and it’s time to more greatly reward excellent teachers.

Despite headlines to the contrary, there’s little reason to be hysterical about the cuts to Memphis City Schools. After all, according to Tennessee Department of Education officials, between 2003 and 2007, the enrollment of Memphis City Schools fell 11 percent. However, its budget grew 19 percent.

This budget hurdle is a significant test for Supt. Cash, and like dozens of urban superintendents before him, it’s a test he’s prepared to pass. Meanwhile, the rest of us need to be engaged in a citywide discussion of single source funding of our schools, and how to move from where we are to where we need to be.

Saturday, September 06, 2008

Wanted: More Community Organizers

What America’s cities need are more community organizers.

In cities like ours, these special people are often the threads holding together inner city neighborhoods. They are often the social entrepreneurs creating new programs to hold together the frayed fabric of their neighborhoods. They are often the only symbols of hope that exist in some of the most challenging circumstances in urban American.

Apparently, some people are so out of touch with urban American that they are unaware of the pivotal role that community organizers play in the life of our cities.

Faith In Community

Strangely, some of the people who seem inclined to denigrate community organizers are the same people who argue that faith-based organizations are most effective in dealing with the problems of our nation. The fact is that some of the most impressive stories of community organizers are those connected with African-American churches combating serious urban problems.

That shouldn’t be surprising, because where the poor is concerned, it has historically been the African-American church that has acted on a central message of their Christian faith: 'If one of your countrymen becomes poor and is unable to support himself among you, help him…”

Then again, these churches have always taken special meaning from the fact that the Bible is filled with admonitions about providing justice and a helping hand to the poor, and their commitment is strengthened by the understanding that there are more references in the Bible to the poor than the rich.

Profiles In Courage

When we think of people who are acting as community organizers, we think of Saint Andrew African Methodist Episcopal (A.M.E.) Church, where Revs. Kenneth and Marilynn Robinson are redefining what a church can be with programs that are reaching more and more into the adjacent neighborhoods to improve the living conditions and lives of the people there.

We think of other churches, both white and black, like Idlewild Presbyterian Church, St. John’s United Methodist Church, World Overcomers Outreach Ministries Church and Hope Presbyterian Church that often are essentially acting as community organizers.

We think of the grassroots-oriented work by Jacob Flowers of the Mid-South Peace and Justice Center that ranges from community gardens, meals for the homeless and voter advocacy. Whether you agree or not with the positions of the Peace and Justice Center, Memphis is well-served by its focus on issues too often overlooked by the political and economic interests in our city.

Organizing Lessons

By the way, if you want to learn the fundamental skills of community organizing, the center is offering an eight-week course beginning September 16 that deals with “power analysis, strategic planning, public speaking, planning a variety of public events, fundraising for justice, working with local media, becoming your own media, coalition-building, and transforming conflicts.”

When we think of community organizers, we think of Albert Crawford, who died a year ago after devoting his life to strengthening his Airways-Lamar neighborhood. Mr. Crawford was always a quiet force for improving his neighborhood although most people had written it off, and because of his community organizing, the area fought the economic forces that threatened it.

We think of Rebekah Jordan, a founder of the Mid-South Interfaith Network for Economic Justice, whose persistence and organizational skills led to formation of the Living Wage Coalition. Defying most predictions, her community organizing resulted in City of Memphis and Shelby County Governments passing policies requiring their employees to be paid a living wage.

High Impact

We think of Reginald Milton, founder and executive director of the South Memphis Alliance, who spending every day fighting the problems, harnessing the energies and providing the services that give neighborhoods a fighting chance. It has developed HIV/AIDS, anger management and conflict resolution and sexual responsibility programs for youths; places where teenagers can go for help and safety; literacy classes to reduce the cycle of poverty and training to teach citizen engagement.

We think of the numerous people in community development corporations across our city who use their community-based work and their unique relationships with their neighborhoods to create better housing and jobs.

In other words, based on what is taking place in Memphis and in countless urban neighborhoods across America, there’s no excuse for community organizing to become a demeaning punch line for some politicians. These organizers simply have too much impact and too much importance for too many neighborhoods.

Citizen Power

The point is underscored this week on Smart City radio, where nationally-known community organizer Harry C. Boyte talks about his new book, The Citizen Solution, which links organizers’ work in neighborhoods to a “citizen movement” and part of the U.S. tradition of populism.

Like community organizers everywhere, he believes that energized, mobilized citizens are more powerful than the politically-motivated politicians who act too slowly to address the needs of the poor and their neighborhoods. It’s in this way, Mr. Boyte said, that citizens can change the face of American by focusing on issues close to home.

It’s inarguable to us. The proof of community organizing in Memphis is too obvious and too compelling, not to mention too vital to our future.

That’s why political smears that demean community organizers are more than manipulative. They are just plain stupid.

This Week On Smart City: Changing Cities And Agents Of Change For Cities

There is a demographic inversion taking place in America, according to Alan Ehrenhalt. Alan is executive editor of Governing Magazine, and in an article last month for The New Republic, he contends that we are beginning to see a new trend in America where people with financial options about where they live are moving to cities, while those with less money are moving to the edges of metro areas.

Also, author, activist and community organizer Harry Boyte talks about his new book, The Citizen Solution, which describes the many ways Americans are now asserting themselves as citizens to shape their communities.

Smart City is a syndicated, weekly hour-long public radio talk show that takes an in-depth look at urban life: the people, places, ideas and trends that affect us all. Host Carol Coletta, president and CEO of CEOs for Cities, talks with national and international public policy experts, economists, business leaders, artists, developers, planners and others on the pulse of city life for a penetrating discussion on urban issues.

Smart City is broadcast at 6 a.m. Saturday and Sundays on WKNO-FM, but it is also webcast and podcast so you can listen to it anytime you like. For the webcast, times for the broadcast in other cities and to sign up for the podcast, visit our website.

Thursday, September 04, 2008

School Funding Switches Sides Of The Street

While Memphis City Council gets all the attention for its new policy on Memphis City Schools funding, Shelby County Board of Commissioners has also changed the budgetary playing field for public education.

Apparently, financial watchdogs for the districts didn’t notice a change in the traditional way that county government funds Memphis City Schools and Shelby County Schools. For the first time in the memory, no specific tax rate was set for schools.

For example, in the past, when the Shelby County Board of Commissioners set a tax rate at $4.04, it set a specific amount, say $2.02, for schools. County government is source of 30% of Memphis City Schools Budget and even more of Shelby County Schools, and because of it, the change could produce a new budget reality for the districts in coming years.

A Penny Here, A Penny There

That’s because when there was a specific tax rate, the funding produced by it automatically grew each year as a result of the increase in the “value of the penny,” or in non-bureaucratese, the amount that a penny of the property tax rates produces as the assessment of property in the county increases. If the tax base grew by 3%, schools realized a 3% increase regardless of their academic results, their financial management and their priorities.

But now, the Board of Commissioners has voted that the county budget for schools is a specific budget amount, just like other government agencies, and as a result, increases in school funding only take place when the commissioners vote in favor of them. The change already seems apparent. In the last fiscal year, the county property taxes allocated to schools totaled $361,288,000, the same amount that was in the adopted budget for 2008-2009.

With 59% of all county property taxes going to schools, it’s hard to argue that the board of commissioners is shirking its commitment to education, but they do seem clearly to be putting it on a level playing field with all other county services.

Double Standard

Because of its allocated part of the total property tax rate in the past, schools often got a free pass in the budget process, while other vital public services – such as health care, The Med, and juvenile justice – had to argue and justify every dollar they received.

Some of the impetus for the change by the commissioners is probably the result of a growing interest in having a stronger voice in public education and a deepening interest in accountability, but more to the point, it likely reflects deepening concern in Shelby County Government that the assessed property valuation for our county will actually go down next year.

It’s a possibility that compounds the regular pressures on Shelby County budgets caused by the mountain of debt and the need for more funding for safety net programs. It’s also worth remembering that state law requires county government to fund schools at no less than the previous year’s budget, so even if the valuation goes down, the commissioners can’t reduce the budgeted amount for schools as it cuts other services.

The Big Chill

Unsurprisingly, Shelby County Schools reacted with their customary bluster. Board member Joe Clayton, in response to suggestions that Superintendent Bobby Webb should meet with county officials to discuss a compromise, said county schools need “to make sure they (county officials) understand that we’re not going to roll over and play dead.”

Generally, it’s Shelby County Schools board members’ opinion that it’s the rest of the world that should always roll over for them. Meanwhile, Superintendent Webb said incredulously that: “We don’t need a shell game here. People think they’re paying taxes for education, but it’s actually being shifted somewhere else.”

It’s the kind of rhetoric that’s seems aimed at stirring up the county board’s political base, but it’s more likely to chill the already cool relationship between Shelby County Schools and its primary funding source. The sign of the times is that these days, criticism of the district is just as likely to come from the Republican side of the house as Democrats.

Doing Their Job

More to the point, it’s just hard to figure out how Mr. Webb sees the board of commissioners’ action is as misleading the public. We’re willing to bet that outside of county government and the school districts, there were precious few people that even knew that property tax funds were coming from a dedicated allocation of the tax rate. Or cared.

Mr. Webb said that taxpayers think they’re paying taxes for education. And that’s true, except we don’t think. It we know it - all of us are paying taxes for schools whether it’s a fixed amount or certain amount of the tax rate.

And there’s a certain arrogance in the notion that the Shelby County Board of Commissioners – who are charged by law with setting the county budget and the county tax rate – is somehow being less than honest in doing exactly what they are elected to do.