Dear Ogden Transit Corridor Stakeholders:
I write to you concerning the Economic Development Opportunities Analysis conducted by Wikstrom Economic Planning Consultants for the Ogden/WSU Transit Corridor Project. The report for this Analysis is dated April 28, 2010, but was not released to the public (as far as I know) until just before it was presented to the Ogden City Council on August 17.
The “bottom line” of this Analysis (summarized on page 23 of the report) is the “Estimated Investment (through 2015)” that would be unique to each of the three different cross-town alignments considered: $1.5 million for Alignment 2b (25th to Harrison); $4.75 million for Alignment 2e (Washington to 30th to Harrison); and $8.5 million for Alignment 2f (Washington to 36th). The ratios of these numbers are striking (up to almost a factor of 6), so I have made every attempt to understand what the numbers mean. Let me now share several concerns regarding these results.
First and most importantly, UTA and Wikstrom have been unable to produce the raw data that was used to obtain these results. The City Council explicitly requested on August 17 that the raw data be provided to interested citizens, and UTA promised to do so promptly. Since then I have been in frequent contact with Mick Crandall and G.J. LaBonty, who have provided me with multiple excuses but no data.
Based on the report and Ms. Wikstrom’s verbal explanation of it, one would expect that the bottom-line results were obtained through a calculation that added expected investments on a parcel-by-parcel basis. Presumably, this calculation was performed on a spreadsheet or the equivalent. All I’m requesting is a copy of that spreadsheet. This will allow us to see how much investment each parcel is presumed to contribute, and to check that the arithmetic was done correctly. It will also allow us to repeat the calculation using different assumptions, to get some idea of the range of uncertainty in the results and perhaps to correct any assumptions that might be invalid. Needless to say, this additional analysis will take some time.
This lengthy and inexplicable delay forces me to conclude either that no such spreadsheet exists, or that the spreadsheet exists but is in a form that Wikstrom is unwilling to show to the public. Either way, it is clear that we cannot trust the bottom-line results when the consultant is unable to show how it obtained them. It is also clear that UTA was negligent in not asking to see the detailed calculation itself, months ago. It is unprofessional and inexcusable for UTA to ask stakeholders to make a $150 million decision on the basis of data that has not been carefully scrutinized by its own professionals. (However, it is human nature to accept results without scrutiny when they tell us what we already wanted to hear.)
My second concern is that although the Analysis apparently used objective data from current property assessments, it also used completely subjective guesses of which properties are likely to be redeveloped by 2015. Of particular concern is the apparent assumption that the entire Macey’s strip mall property at 36th and Washington will be redeveloped within five years. We need to scrutinize these guesses and recalculate the results under a wider range of possibilities.
My third concern with the Analysis is that all the estimated investments are too low. While Ogden cannot expect to reproduce the multi-billion-dollar investment along Portland’s highly successful streetcar line, we have every reason to hope that a $150 million public investment will generate more than a few million dollars in private investment. In her City Council presentation, Ms. Wikstrom stated that the assumptions behind the analysis were "conservative". One obviously conservative assumption is the arbitrary cutoff date of 2015 for an investment to be counted in the analysis. Another conservative assumption is that development densities will be limited by current zoning. A third conservative assumption is that a streetcar will not raise the land improvement value ratios above the city-wide average. All of these assumptions are highly questionable, so it is crucial that stakeholders be informed not only of this “worst- case” scenario, but also of a range of other, more likely, scenarios.
My fourth concern is that based on the report and a brief conversation with Ms. Wikstrom after the August 17 meeting, my tentative understanding is that the Analysis assumed that all land values along the corridor will remain unchanged, even after the project is completed. As a result, the Analysis intrinsically favored parcels of land that are already more valuable, and disfavored land that is currently assessed at a lower per-acre rate. Yet if a streetcar will have any economic development benefit at all, that benefit will come fundamentally from an increase in land values along the corridor. In this sense, the greatest economic development potential should actually be where land values are currently low, not high. Furthermore, we might expect current commercial land values to be highest in areas with more automobile traffic--and these areas are probably the least susceptible to change from a transit project. In short, it appears that the Economic Development Opportunities Analysis is actually an analysis of what might happen without a new transit project, rather than with one.
In conclusion, I would urge you to completely ignore the Economic Development Opportunities Analysis until such time as these serious issues can be fully resolved.
Respecfully,
Dan Schroeder, Conservation Chair
Ogden Sierra Club
