2006 CPEO Brownfields List Archive

From: "Peter B. Meyer" <pbmeyer@louisville.edu>
Date: 27 Oct 2006 23:14:03 -0000
Reply: cpeo-brownfields
Subject: Re: [CPEO-BIF] Re: Re-Working the Thinking on Brownfields Subsidies
 
I wish we could educate local officials about real estate market conditions in their jurisdictions and hold them accountable to support the public interest, as Bruce Reshen has suggested ... that would be ideal. However, we need a reality fix here: the average (that is, mean sized) local government jurisdiction in the USA has a total population of something on the order of 2-3,000 people .... that means is does not have full time staff to educate! That also means that they probably rely on the local Chamber of Commerce to manage their economic development and related subsidy and business incentive programs. And, regardless of size, the local officials typically depend on local businesspeople to help finance their campaigns. ... so where do we get the objectivity that Bruce recommends? It is at least as unrealistic to expect our cities and towns to develop those capacities as it is to pursue the mythic "optimal efficiency" of neoclassical microeconomics.
... and lest someone suggest that state decisions will be better, let me remind us all that states get their data on local economic issues from their localities. The states do not have the staff to collect those data objectively themselves.


Next, let me address the "anything that claws back or places additional restrictions on developers is bad, therefore no conditions can apply" argument. This appears to be what Lee Hoffman has put before us in his statements, and Barry Trilling appears to also hold this position now, which confuses me, since I agreed with his earlier comment that he and I were converging in our thinking. Let me posit an argument based on an extreme case: that we give away whatever funds we have to stimulate brownfield redevelopment on a first come, first serve, basis, accepting the claims of need of the developers, backed by zero proof of their actual risks or true expected returns on investment.

Would that be rational? Remember, that means that the first developer to apply, whethe ror not the project needed the funds, would get them, and later developers, who might have planned a bit better and done more research on how to maximize profits through their own efforts, would get nothing.

Excuse me, all public officials who attempt NOT to do what I just described, but what I described above as an "extreme case" is, in reality, a common practice ... and it is not efficient, not effective, and not even rational. It does not serve the bulk of the development industry well, and it certainly does not serve taxpayers' interests.

Barry's suggestion of a balancing out after the fact is well worth considering, as is the incrementalism Lee describes (which is akin to the "pay for performance" contracting that the Office of Underground Storage Tanks was avocating some years ago). Let's return to the issue of a viable program to use our limited funds as efficiently as we can ... that is what this discourse can best generate.

There now will be a few days' gap in my responding to the listserve, since I am travelling and will not have regular e-mail access. Please do not take my delayed responses as a lack of interest in this extrmely important topic.

Peter

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