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If GOP keeps austerity promises, big metro projects on rail, housing and research may be pared or eliminated

Despite these new realities, leading thinkers are confident that a new pragmatism will emerge from Tuesday’s election, one that propels a few states and metro regions to make targeted public/private investments.

Tuesday’s sharp turn to the right casts a long shadow on the nation’s — and the Twin Cities’ — metropolitan agenda. Public investments in transportation, urban education, and university-based research and development may be pared or even sacrificed if the new conservative majorities make good on the tax-cutting and deficit-reducing promises made in their campaigns.

With austerity the new watchword, and with cuts to the military and middle-class entitlements difficult to achieve, all other government functions are on the chopping block. That means smaller federal and state appetites for metro projects like high-speed rail, mass transit, freeway and bridge repairs, harbor and airport improvements, early childhood education, job training, affordable housing, parks and trails, and university-based research aimed at strengthening innovation and competitiveness.

For older cities like Minneapolis and St. Paul, it also means a continuing slide in state aid and a heightened pressure on local property taxes, leading to more cuts in police, schools, street repairs and other basic urban functions, prompting, perhaps, an even deeper separation between the urban poor and everyone else.

High-profile metro projects such as the Southwest light-rail corridor and high-speed rail connecting Minneapolis-St. Paul to Chicago are also in jeopardy. The stunning defeat of 18-term Rep. Jim Oberstar, chairman of the House transportation committee, was a major blow to the Twin Cities’ ability to get federal help on infrastructure projects.

A shift to local economies
Despite these new realities, leading thinkers are confident that a new pragmatism will emerge from Tuesday’s election, one that propels a few metro regions to make targeted public/private investments that generate new export-based local economies while providing the kinds of high-value jobs that Americans need so badly.

Those innovations, they said, are more likely to come from metro regions than from a national government paralyzed by ideological rivalries and media sideshows. If the Twin Cities can overcome a few nagging obstacles, especially its reluctance to commercialize university research, it has a chance to emerge as one of several U.S. metro regions benefiting from this localized, public/private approach, according to Bruce Katz, director of the Metropolitan Policy Program at the Brookings Institution, and Ben Hecht, president and CEO of Living Cities, a consortium of foundations and financial institutions. More about that later.

Bruce Katz
Bruce Katz

It’s not that the big problems have changed. The nation must still deal with global warming, energy dependence, an aging and increasingly diverse population and an economy that cannot seem to pick up any speed. What has changed is the set of solutions that voters are willing to consider. Carbon taxes, for example, are off the table, at least for now. For metro areas, that means the cost of driving will continue to be held artificially low and the pressure for spread-out, inefficient development will continue when building resumes. Cuts to programs that promote walking, biking and community design are likely as the so-called livability agenda takes a hit, at least in the short term.

Meanwhile, Oberstar’s defeat, coupled with the GOP takeover in the Minnesota Legislature, throws into doubt the future of several major Twin Cities transit projects, including the Southwest and Bottineau light-rail corridors, the Northern Lights Express rail line to Duluth, and Hennepin County’s Transportation Interchange next to Target Field in downtown Minneapolis. A full revival for St. Paul’s Union Depot also seems in jeopardy with the election of Republican Scott Walker as governor of Wisconsin. Walker has promised to block the proposed high-speed rail connection between Chicago and the Twin Cities.

Despite those potential setbacks, local and national leaders on the metropolitan agenda took a measured approach to the election results in interviews on Wednesday.

Suddenly, a different world
Metropolitan Council Chairman Peter Bell, a Republican, said that many metro services, especially transit, are in a stronger position now than they were eight years ago, but that money to operate and expand will now be harder to come by.

Peter Bell
Peter Bell

“From my perspective, public support for investments in improved transit has not waned, but securing federal and state funds will be more difficult because of budgetary constraints,” he said. “The election reaffirms the policies that the Council has pursued over the past eight years, which emphasize the efficient delivery of essential government infrastructure service without increasing taxes.”

Hennepin County Commissioner Peter McLaughlin, a Democrat, said that progress will be harder and slower but that the metro region will find pragmatic, cost-effective ways to produce transportation infrastructure.

“It’s a different world today than it was yesterday, no question,” he said. “But we have to retool for a new century, and that’s not necessarily a bad thing. We’ve had a centrist, bi-partisan approach on the County Board and it has worked. Now we have to get rid of the hyper-partisanship that has hurt us at other levels of government. People have had their switchblades out. Now it’s time to put them away and get to work.”

McLaughlin said he doubts that big business interests aligned with Republicans would like to see further cuts in research and development at the University of Minnesota or in job-training programs at community colleges. He’s eager to find out, he said, whether GOP interests will favor scrapping the Southwest LRT line (which would run through Republican suburbs). “The whole transit issue depends on whether it has moved beyond partisanship, as it has in a lot of places,” he said.

“The loss of Oberstar is a huge loss for the whole country and for Minnesota,” McLaughlin continued. “He’s been able to push the infrastructure issue in a way that makes it clear that it’s part of our ability to compete with China and other economic competitors, and it’ll be unfortunate if we lose that focus.”

Caren Dewar
Caren Dewar

Finding a simpler message
Caren Dewar, executive director of the Urban Land Institute-Minnesota, said the election illustrates a basic disconnect in the public mind. “People don’t want to pay for what they want,” she said. That, in turn, places a greater burden on political, business and civic leaders to explain the importance of metro investments in simpler terms because complex messages cannot win elections. “The case that we need to get our house in order and to reduce the deficit is a compelling one for me,” she said. “But so is the case that we need to make investments in our future. We must find a way to convince people that there’s an important return on those investments.”

Lee Sheehy, director of the region and communities grant program at the McKnight Foundation, said his organization remains committed to advancing sustainable economic development for the metro region. But he said the election result “increases the need to get maximum and multiple benefits from public investments in transit, housing and parks, for example.” The Twin Cities’ success last month in winning $21 million in grants and loans from public and private sources (HUD and from Living Cities) to leverage housing and economic development at transit stations illustrates the kind of big-bang-for-the buck collaboration that voters seem to calling for, he said.

Ben Hecht, the Living Cities CEO, said that Tuesday’s election result may well reduce the federal role in metro decisions, but that many communities have the assets to solve their own problems if they align public, private and philanthropic sectors.

“No one segment has the answer,” he said, referring to the hopes and dreams of many that Obama would turn out to be some kind of miracle worker. “Our model is that government is just one of the players at the table,” he said. While political climates change in historically predictable cycles, communities must find stable and robust ways to solve problems, he said.

On transportation, for example, he said he’s confident that a public/private infrastructure bank will emerge as a financing source. The private sector will be a player in future transportation investments he predicted, much as it has invested (perhaps overinvested) in building the broadband network.

Key challenge: Not leaving low-income citizens behind
Minneapolis-St. Paul is accustomed to the kind of public/private collaboration that will be increasingly required, he said. The key challenge, he added, is to make sure that low-income citizens are not left behind, as they were in the last several economic upturns.

Bruce Katz of Brookings said the new political reality in Washington and in many state capitols opens the way for states and metro areas for forge their own economic futures, almost apart from the federal government. The emerging economy will be less national than a sum of local economies, he said.

“Minneapolis, after all, is very different from Miami. And that’s how it should be,” he said. What’s holding the Twin Cities back is a lack of entrepreneurship, he said, particularly on converting university-based research to locally produced products. If that begins to happen, the region could emerge as a winner in a new export-driven economy.

“The Twin Cities is at a juncture,” he said. “You need to take advantage of entrepreneurial startups and the commercialization of ideas. You need to get beyond just the focus on transportation and land use and pay attention to what it is you want to produce with the resources you have.”