This past Friday I attended the first Minnesota Twins baseball game at the new Target Field, an exhibition contest against the St. Louis Cardinals. The game was a rematch of the 1987 World Series (won by the Twins) and perhaps a preview of the next one. It was a festive night, filled with the wonder and glory of what is truly an amazing ball park.

There are two important things I want to impart this week about Target Field as it relates to Strong Towns, but first I have to write this entry so those of you who oppose the stadium because of taxpayer funding, like one of our local talk show hosts, can get past your anger to ponder the larger question.

So let's deal with the issue of funding head on. The industry of baseball is immense and grotesque to almost all of us. The idea that someone would get paid millions and millions of dollars for playing a game just seems ridiculous. That the owners of these teams routinely demand (and get) public subsidies for their stadiums seems wrong, especially when we are cutting funding for education, for health care and other socially-redeeming needs. That all would be taxed for a facility that is enjoyed by a few is particularly offensive to those who do not enjoy the nation's pastime.

We are not going to dispute any of this. These are valid criticisms. What I hope to do here is to channel that outrage into a consistent approach to how we make capital investments.

Let's outline the key criticisms.

  1. There is no return, or a very low return, on the investment of public tax monies.
  2. The expenditure benefits only a few, yet everyone is taxed.
  3. The money could be better spent elsewhere.

The challenge here is to change these criticisms into a philosophy that can then be applied to capital investments. If we do this, to ensure that our expenditures meet our values, we would require the following:

  1. That the expenditure of public tax dollars on capital improvements generates a measurable return on investment. We must actually estimate and monitor the return throughout the life of the project.
  2. To the extent possible, those that benefit should pay directly for the improvement.
  3. In a competition for tax dollars, priority will be given to those capital improvement projects that benefit the greatest number of people and have the highest return on investment.

I'd certainly welcome a discussion on these three values. Remember, I am not trying to compare funding for college scholarships or nursing care with expenditures on roads, sewers and libraries. What I am trying to do here is create a philosophical framework that we can apply to capital improvement projects (roads, sewer, libraries and stadiums, etc...).

The interesting thing here now would be to apply this criteria to some of the other projects we have examined recently on this blog.

Stillwater Bridge

Even at $668 million, Tea Party headliner Michelle Bachmann supports the project. But the return on investment (ROI) is ambiguous at best - potentially some additional low-density development along the eastern banks of the St. Croix. Nobody local is directly paying a dime for the bridge and the project is estimated to serve just 16,000 trips per day.

Backus Wastewater Project

For $3.3 million, this is the smallest project we have examined. However, there is no local contribution and, at a total population of just 311, it serves very few. By replacing one sewer system with a another, the project is essentially maintenance and would not be expected to create any new growth in Backus. In other words, no ROI.

Rogers Interchange

The Rogers interchange may induce some new growth, but at $34 million and with the land use "controls" they have in place, there is nothing to suggest a positive ROI. Again, there is no local contribution - in fact, Rogers is asking for even more money in support of the interchange investment - and while larger than Backus, it is still a very small subsection of commuters that would take advantage of this improvement. There is no statewide or even regional significance to shortening commutes by 15 to 20 minutes in the Rogers area.

College Drive in Brainerd

A project in my hometown to turn a local street into an urban highway, the cost is $7.4 million for one mile (although recent council action has sent the project back to the drawing board). Along the entire length of the road is a public college, dorms, a park, undevelopable green space and parking. In other words, enhancing this shortcut will have no impact on inducing new development amongst the adjacent properties. Any return that might be felt by providing quicker travel throughout the system would be difficult to measure, and likely even more difficult to detect. This is another investment that benefits only a few, this time the people who live outside of Brainerd and want a quick trip through town.

Target Field

It is expected - and we can actually measure - that the areas around Target Field are going to see redevelopment. Since the infrastructure is already in place and being maintained, new condo units, restaurants, retail and office space would be a bonus. It is not clear how much of this there will be, but there will be some. If you assume the team would be leaving town without the stadium, then the income tax paid by the players is a multi-million dollar annual return. The ball park cost $522 million, of which the team paid $130 million. The remainder is paid by a local sales tax, not general tax dollars. There is no question that, of the projects included in this list, Target Field will benefit the largest number of people.

 

Again, none of this is to argue that Target Field is a great public investment. But if we are to be consistent with our approach, we should be equally outraged - perhaps more - by the way our money is spent on horizontal infrastructure (roads, bridges, sewer lines, etc...)  than the way it is spent on vertical infrastructure (stadiums, libraries, etc...).

Unfortunately, we are not. We rarely question the notion of fighting congestion by throwing money at roads, bridges and interchanges. We rarely stop to ponder the ROI on building sewers and water systems to induce "growth". We spend this money automatically because that is what we do. It is our social contract, in a sense. You pay for my local project I can't afford and I'll pay for yours. 

If it seems ridiculous, it is. And it can't continue, which is why we need a Strong Towns approach.

 

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