The next big idea is small ...
This isn’t a call to end long-range comprehensive plans. In lots of circumstances, they are necessary. This is a call to consider that many small players can be much more effective, and more risk-adverse than one large project. Large plans like Elk Run expose us to tremendous risk if they fail. The future of our plans need to be everything that Elk Run isn’t: small, numerous, and nimble.
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The desire for convention centers is simple: it brings in visitors with outside money who consume things that are taxed at higher rates (alcohol, hotel rooms, rental cars, etc). From the city’s perspective, it appears to be a win-win. But, these investments come at a cost. In this case, the cost is increased competition.
The number of conventions and total number of people going to conventions has decreased since it peaked in the mid-1990s. The situation we have now is that of more cities are competing for fewer dollars.
It's a classic race to the bottom.
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We took an affordable, efficient and long-lasting mode of transport funded privately by direct value capture and replaced it with an expensive, inefficient and maintenance-intensive system funded by politicians using a blunt tax.
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What this series is meant to do is to pull back the curtain for people who assume that, when we make investments in infrastructure, the government is ultimately getting money back -- through new income tax, sales tax, property tax, etc... -- in an amount that exceeds the cost of the project. Nothing could be further from the truth.
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This is a continuation of our in-depth look at the way that cost/benefit analyses are done to justify infrastructure spending, particularly in large grant programs such as the recent TIGER II. Today we are looking at the cost side of the equation.
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This is a continuation of our in-depth look at the way that cost/benefit analyses are done. We are talking specifically here about a TIGER II project for an overpass in the city of Staples, MN. Today we're covering the safety, carbon reduction and maintenance arguments.
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Last week we started our examination of the types of financial analysis that are done to justify infrastructure projects in typical funding programs such as TIGER II. Our analysis today focuses on a project in the city of Staples. The Staples project presents a mechanism to demonstrate, in depth, how a typical cost/benefit analysis is done.
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Many people assume that, when we invest in infrastructure, "the government" gets back - by whatever means and at whatever level - cumulatively more money than it puts into a project. There are others who know that this is not remotely true.
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The second round of Transportation Investment Generating Economic Recovery (TIGER) grants are landing just as a tumultuous election season is coming to an end. In "normal" times, the grants -- nearly $600 million worth -- would allow politicians to claim they are doing something to, as the name implies, invest in transportation and thus generate an economic recovery. This time around that claim seems to have much less traction.
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