Abby Newsham  0:00  

Hey, this is Abby, and you are listening to Upzoned.

Abby Newsham  0:18  

Hey, everyone, thanks for listening to another episode of Upzoned, a show where we take a big story from the news each week that touches the Strong Towns conversation and we upzone it: We talk about it in depth. I'm Abby Newsham, a planner in Kansas City, and today I am joined by John Pattison, the community builder for Strong Towns. John, thank you for joining me.

John Pattison  0:41  

It's great to be here, Abby, thanks. You and I just spoke a few weeks ago, so this is nice to be back already.

Abby Newsham  0:46  

I know you're like a regular Upzoned co-host/guest. It's added to your official title.

John Pattison  0:54  

On Saturday Night Live, after a few episodes of hosting, you get special jackets. I feel like there needs to be something like that for Upzoned. When you've co-hosted three times with Abby, you get some kind of special jacket.

Abby Newsham  1:07  

Hey, I would like a special jacket. That would be awesome.

John Pattison  1:13  

True, you first. Maybe those Strong Towns high-viz vests that we give Local Conversation leaders.

Abby Newsham  1:17  

Yeah, I'd love that. I could wear it when I record even though we don't post the video.

John Pattison  1:22  

Yeah, I like it.

Abby Newsham  1:24  

Awesome. Well, we're going to talk about an article that was published in City Lab entitled "The economic benefits of paying workers to move." So this is about a program that's been running since 2018 in Tulsa called Tulsa Remote. This program offers $10,000 to remote workers to relocate there for at least a year. A study about this program by economist Tim Bartik of the W E Upjohn Institute finds that for every dollar Tulsa spent on this program, the city sees about $4.31 in economic benefits. The key findings include that many of the programs participants would not have moved to Tulsa if the incentive hadn't existed, between 58% and 70% of people are in that category. The influx of remote workers has also boosted local spending, increased tax revenue, led to job creation and generally expanded the tax base. In terms of retention, the program has performed pretty well. About 96% of participants remained through that first year, and roughly 70% stay longer term. There are some potential downsides of a program like this, especially around housing. While the housing stock in Tulsa has mostly kept up with demand, increase in property values and rents can pose some challenges, particularly for households on fixed incomes. But overall, the study suggests that Tulsa Remote is a very cost efficient and beneficial way of bringing people to the city and increasing the economic health of the city compared to many traditional tax incentive programs such as business tax breaks. The study argues that people-oriented economic development, which is investing and attracting remote workers and integrating them into the community, can pay off in very measurable and sustainable ways. So John, I'm curious, from a Strong Towns perspective, if this is an approach to economic development that aligns with what you and your team would see as a more resilient and sustainable way of approaching economic development.

John Pattison  3:47  

I feel like I say this every time you and I co-host, but I'm torn.

Abby Newsham  3:51  

Yeah, I know.

John Pattison  3:54  

I think when I first saw this article, my initial reaction was like, highly skeptical. And then I read it, I was like, okay, I can see some benefits here. So I am quite torn. I think one of the things about this program that makes it a little bit more palatable for me is that it is not public funds that are being used to lure them. It's a private foundation. So this really hasn't cost the city anything directly. So I like that it's an experiment that's being run with foundation dollars rather than tax dollars. Still, part of me is like, if we build great places, people will want to move there. So I feel like maybe a more Strong Towns approach would be to make Tulsa a great place to live for the people who are already there, and then you're gonna have people who just can't wait to move to Tulsa. But -- here you hear me equivocating -- but maybe people don't know enough about Tulsa to know that it's already a great place to live. So is this just a great advertising campaign? I'm not sure. What's your take though, Abby? Help provide some clarity for me.

Abby Newsham  5:04  

I wish I could provide some clarity, honestly. I agree with you. I think this is a really interesting approach for a philanthropic funding mechanism to take to try to invest in the city and bring workers to a community. I think especially if there's a particular type of worker that they're looking to attract -- it sounds like this is mostly remote workers -- there's benefit if it maybe is also linking to job need within the local economy. But when I ran the math on this... I think it's like $34 million have been invested in this program. What's $34 million times $4 roughly? I'm just looking at Google, which doesn't give me any commas in their equation. I think it's $136 million, is what they're saying their return on investment is. To be honest with you, I haven't actually gone to the study to read into it, so I would encourage listeners who are interested to go and read that study, and I probably will take a look at that as well. But I mean, I think it's interesting as an alternative to economic development tools that really favor real estate projects. We see often that cities have programs that are intended to attract one big employer and give them a lot of tax breaks to oftentimes build a big corporate campus, maybe in the middle of nowhere, not integrated into the existing city. It creates a lot of strain in terms of all that additional infrastructure and the tax breaks associated with it. Of course, the argument is, "Well, we brought all these high paying jobs to the city." But if that employer leaves, which has happened in my city and has happened in many cities, you lose out on on all that value that's been brought in by that employer, and also you're on the hook for all that infrastructure that you've built as a city. So I think approaching this in a way that is not about assisting in someone's giant real estate project and investing in one company and hoping they don't leave, is a more resilient strategy. You're trying to attract people that have remote jobs and bring them into your city. With that, they bring their income, they bring their activity, they probably bring families. So to me, that's a smarter way because you're integrating that money into the existing system, rather than trying to attract workers by by giving tax breaks to new projects to expand the city, which is often in the form of sprawl.

John Pattison  8:11  

Yeah, I think the article said that those traditional incentive programs to attract large employers have a ratio of two to one in terms of return on investment, compared to the four to one here. So yeah, I see what you're saying. I think it is more resilient. I did go back and I looked at an article that City Lab ran in 2020 when Tulsa was first introducing this program. One of the things that it said was that Tulsa had built all of these amazing amenities. There was like a $465 million park, there was a new convention center, there was a new arts district, but what they realized was there was nobody to enjoy them. So this was, in part, a plan to get people to come and see what Tulsa had built. To me, that does feel like putting the cart before the horse a little bit. Maybe Tulsa has learned from that. Because they built it hoping that people would come, but people didn't come, and so now a private foundation is having to pay people to move to Tulsa and enjoy all these good things that Tulsa built.

Abby Newsham  9:29  

That's really interesting. I actually had not heard about that before, but it kind of makes sense. They invested in a park near their downtown, or maybe it's in their downtown, but it's an incredible park. Have you ever been to it, John?

John Pattison  9:44  

No, but the pictures looked amazing. Have you been in person?

Abby Newsham  9:47  

Yeah, yeah. It's one of the coolest parks that that I've ever been to in my life. It's really cool.

John Pattison  9:57  

So is this that $465 million park?

Abby Newsham  10:01  

Yeah, I believe so. I think it was privately funded, or funded through philanthropic means. I don't think that the city put much into it, if anything.

John Pattison  10:14  

Yeah, I would hope not because that's an expensive park.

Abby Newsham  10:19  

Yeah, a very expensive park. I mean, there are quite a few cities in the Midwest that I've been seeing more philanthropic dollars stepping up, instead of city dollars to improve placemaking and invest in things like parks and public spaces. It does make me wonder about what that means for the future of our cities and how our tax dollars were kind of intended to associate with nice public places. It's like we've built cities we can't afford, and we therefore can't improve our park system, so we're seeing philanthropic organizations step in. It is a little worrisome in terms of whether they are going to provide the support long term to fill in for where our tax dollars are not able to afford nice places.

John Pattison  11:27  

Something else that I didn't appreciate until I was reading this article, and I'd love to hear your take on this as well, is that it turns out that this program, which is called Tulsa Remote, is not alone. There are about 100 other programs in the United States that have some sort of incentive program like this, offering incentives to get people to move there. I looked them up, and they have names like Flourish in Fort Wayne, Find Your Place in Muncie. So this is becoming more and more common. I think it's in places that are trying to attract people and haven't been able to get on people's radars in other ways.

Abby Newsham  12:07  

Well, if you think about it, cities really used to have to rely on attracting employers in order to get people to move to their places, and that can be really challenging, especially if you need a particular type of office space to support that kind of business. There's only so many businesses with the capacity to really transform a city out there. So cities are kind of left competing for that next moonshot project that's going to bring a bunch of employees. This is interesting because now we're kind of in a new age where there's a lot more opportunities for remote work, where you can live anywhere. I even think of really small towns that probably will never attract the big company, but maybe they have some some kind of attraction, like a really interesting landscape or being in a beautiful setting, that they could use to attract remote workers, so long as they have the internet. So I think it opens up opportunities for some smaller towns to really benefit from having more remote workers and not trying to go after big employers that they might strike a deal with that ends up not being in the best interest of of the community. Of course, the devil's in the details always, because there's potential to screw up anything, but this, at least, seems like it's more of a small bet approach to attracting workers and expanding tax base.

John Pattison  13:51  

Yes, and maybe the most interesting thing about this program, for me, is the social infrastructure that they built around it. They have co-working spaces. There are networking events. The article talks about somebody they interviewed who had a death in the family, and there was a grief counseling group. They have mentors who have gone through the program. So there's all of this other social infrastructure to make these new Tulsa residents successful. I think some of those things actually do benefit the people who already live there. I think it's really interesting that high retention rate of people who stay in Tulsa. I do feel like that maybe the social infrastructure is part of the secret of that success. That we got people here to Tulsa, but now we are introducing them to the types of amenities and clubs and neighbors that will make them want to stay. I think you could make a case that this benefits the people who are already in Tulsa.

Abby Newsham  15:03  

Yeah, I wonder what their landscape is as far as making friends. I've never lived in Tulsa, and I know that, in certain cities, it's harder to make new friends than others. So I just wonder if Tulsa is also succeeding because of that social infrastructure piece, that people are open and there are ways to integrate yourself into this city in a way that maybe would be more challenging. One thing that I am a little bit skeptical about with these programs is whether or not $10,000 is really enough to attract people, and how how significant that has been. I feel like that incentive might cover only part of the cost of moving. It feels more like a moving bonus than a transformational amount of money that could bring somebody to a place. Because even though $10,000 sounds like a lot, and I'm sure it's useful and it's appreciated for many people with really established lives, like having mortgages or kids or their existing job, it's maybe not enough to cover all relocation costs or to offset the risk of moving, especially for someone who maybe has more assets or networks or responsibilities. The anchor factor of the place they currently live in might dominate their decision over the incentive. So I am curious about where that $10,000 number came from, what types of people they're attracting with a $10,000 number, if other programs have tried other amounts of money to attract other types of people. I think about Bentonville, and this is a different kind of program, but I'm pretty sure Walmart requires every company they do business with to have an office located in northwest Arkansas or Bentonville. And they need to have, like, high net worth members of their C-suite located in Bentonville, it can't just be lower paid workers. They want actual executives from those companies located in Bentonville. So that's been another approach to bringing different income levels to a city. But this is very different from Tulsa, because -- at least this is what I picture when I when I think about their program -- it seems that the demographics are probably relatively young, remote workers that maybe haven't had a family and established themselves in a place yet. I'd be curious what the demographic makeup of those people are.

John Pattison  18:08  

Yeah, me too. I think I did see a stat, either in this article or in the one from a few years ago when a program was just getting started, that a very high percentage of the people that were being attracted to this program were in the tech industry. Like they wanted the tech industry but didn't have the tech workers. So I think that they wanted to attract the tech workers in order to help develop, eventually, a tech industry. I can't remember what it was, but it was something like a quarter of all of all of the folks who had taken advantage of the program at that point were in the tech industry. To your point, even the person that they interviewed for the article that we're discussing today was already looking for a change. So it wasn't luring somebody who had roots somewhere else, but it was somebody who was looking to make a change. I do think that you're right, those are probably more likely to be younger folks, maybe folks without kids yet. So yeah, it is one particular demographic, and I think that if those are higher wage earners, then are those going to drive up housing costs eventually for existing residents?

Abby Newsham  19:21  

Yeah, I would be curious about that. How that does impact the overall housing market? I'm trying to remember how many people they said participated in the program. It was a few thousand, I believe. So maybe that's not enough to really make a huge impact on the market, although I could be wrong. I'm not an economist, and I don't have any of the numbers for what Tulsa's supply of housing or their existing population is in front of me. But I'm curious about, with the number of people that have participated in this program, and what their incomes are, what the quantifiable impact to the housing market would be.

John Pattison  20:09  

Yeah, you're right. It does say that it was 3400 people that have participated so far. The paragraph about the tech workers is in this article, and it says "An influx of tech talent, 26% of the 2024 class." So not of all of the people who participated, but just last year, and I'm sorry I got that wrong. "An influx of tech talent, 26% of the 24 of the 2024 class worked in the industry creates spillover effects by helping solve what somebody describes as Tulsa's chicken and egg problem. The city couldn't attract high tech jobs without high tech workers and vice versa."

Abby Newsham  20:48  

So now that the workers move there, they can presumably advertise to the companies that they have the workforce. So maybe they are then turning around and doing the more traditional economic development program by saying, "Hey, we have the employment base now. You can go build your office now."

John Pattison  21:13  

So maybe Tulsa has solved that age old conundrum of the chicken and the egg.

Abby Newsham  21:17  

Yeah, yeah. That would be pretty amazing, if they have.

John Pattison  21:22  

I did look up to see if we have published much about Tulsa on the Strong Town site over the years. We have published, actually, two articles just this year about Tulsa, because they're kind of leading the way, along with South Bend and a couple other places, with pre-approved housing plans. So I think that Tulsa is doing some pretty cool, Strong Towns-y kind of things that I think will build long term resilience.

Abby Newsham  21:50  

Yeah, I have a really positive connotation of Tulsa. I think I was there pre-covid, and I spent some time in the Tulsa arts district. They just have a really cool thing going in that area of town. They have some really interesting museums, really cool old buildings, and the city itself just has really good bones. I'm sure there's a lot of really neat stuff going on. Yeah, I'm looking right now, and Strong Towns has been covering some stories in Tulsa. So shout out, Tulsa. And Oklahoma City too. I've been to both cities in the last decade -- which, by the way, I can't believe I'm old enough now that I'm starting to measure things by the decade. But yeah, I have been there in the last six years to both places, and I had very good experience in both places, and I hadn't spent a ton of time in Oklahoma before that. So I appreciate what a lot of folks in Oklahoma are doing. I think the one thing I would leave this conversation on is the question of how you retain people who participate in these programs. Because, yes, 70% of people have stayed longer term, but there are 30% of people that have moved on. I'd be curious what the reasoning is for those people who have moved on. Like we said before, the people who participate in these programs are probably a little more open-minded to moving to different places. So who knows, maybe they took $10,000 from the next city and moved on. That might be a pretty good way to get to move to many different places. But I do wonder if it has anything to do with the culture or the amenities, or anything about the place that didn't work out. Did the people go back to where they came from, or did they go to a different city again? This might be something that's in the report. I should probably go take a look at it. But if not, I would love to understand how they're looking at the retention factor, and whether or not there's kind of a phase two of a program like this that is really focused on retention, or if the retention issue is not really a concern of theirs and there's other iterations of this program that focus on other aspects that could be improved.

John Pattison  24:40  

Yeah, I think that you're right. I think that would be really interesting to look deeper into. I think that would help inform other cities that are either already doing this or thinking about doing this, especially funded by foundation dollars.

Abby Newsham  24:54  

Yeah, absolutely. Well, I think we can leave it there. Before we finish up, it is time for the downzone, which is the part of the show where we can share anything that has been on our mind, anything we've been listening to, reading, watching, anything that has been captivating our time and attention these days. John, I will give it to you.

John Pattison  25:19  

Yeah, thank you. I want to recommend a book that I just finished, and that is the book "Big Dumb Eyes" by the comedian Nate Bargatze. I'm a huge Nate Bargatze fan, and I was really looking forward to reading the book. In fact, I listened to it on audio, and that was a great experience. It was very funny. My favorite parts of the book were at the beginning of the book, where he was talking a lot about his childhood and growing up in Tennessee, I wish he would have gotten into a little bit more about what it was like becoming a comedian, but maybe that will be coming up in the second book, but definitely a lot of laugh out loud moments, and I'm a big fan. What about you?

Abby Newsham  25:59  

Well, I actually have a book too. So, this, this actually comes out of the fact that I went to a theater, I think it was last week, and I saw Harry Potter three. I think that's the one that it was. It was, like, really scary,

John Pattison  26:19  

Yeah, Prisoner of Azkaban.

Abby Newsham  26:20  

Yes, we were there with kids, like children, and when I saw the Dementors, I was like, "Oh yeah, this is actually really scary." I didn't think about that before. But it occurred to me that I had never picked up these books and read through them all, and I decided to start with Harry Potter four, so the Goblet of Fire, and I have been listening to it on audiobook. I had a long drive earlier this week and decided to download it and start listening to it. And man, these books are really good, and also, I actually decided to start watching that movie, the fourth one, and I can now understand why people complain about the movies, because the movies really don't have nearly as much detail as the books. It's kind of amazing when you spend some time with the books and then go watch one of the movies, just how strikingly different it is, and just the the long backstories that are given to specific characters or instances are not there, or just little areas of the plot that get missed out in a movie. Obviously, in a movie, you just can't capture that level of detail and and change in the story. But yeah, it made me really appreciate the frustration of fans, even though I'm about 25 years behind.

John Pattison  27:57  

Yeah. I don't know if you know this, but we call our house The Burrow, and it's named after The Burrow in the Harry Potter series.

Abby Newsham  28:05  

Really?

John Pattison  28:06  

Yeah, we love we and my office is called the Room of Requirement because it's whatever we need it to be. So we're big Harry Potter fans over here.

Abby Newsham  28:13  

Oh, that's great. Does it talk about The Burrow in the movies?

John Pattison  28:17  

Yeah, but like, more in the earlier books, it kind of describes it. When he goes here for the first time, I think it's two. The Burrow is where the Weasleys live, and it's always a place of refuge for him. We love that idea of being a place of refuge and hospitality. There's always a lot of people in our house, and so it feels like the Weasley's house. Even my dog, my dog's name is Ginny Weasley, our chicken coop is our address and then three quarters, because of Harry Potter.

Abby Newsham  28:53  

That's awesome. Well, I didn't realize I'm talking to a bonafide Harry Potter fan. Much appreciate that. We'll have to talk more about this, because now that I'm just getting into it, I have a lot of thoughts. All right, thanks, John. I appreciate your time today, and thanks everyone for listening to another episode of Upzoned. Thanks, John.

John Pattison  29:15  

Thank you, Abby. Thanks for having me.

Norm Van Eeden Petersman  29:20  

This episode was produced by Strong Towns, a non profit movement for building financially resilient communities. If what you heard today matters to you, deepen your connection by becoming a Strong Towns member at strongtowns.org/membership.