Rebuilding Place in the Urban Space

"A community’s physical form, rather than its land uses, is its most intrinsic and enduring characteristic." [Katz, EPA] This blog focuses on place and placemaking and all that makes it work--historic preservation, urban design, transportation, asset-based community development, arts & cultural development, commercial district revitalization, tourism & destination development, and quality of life advocacy--along with doses of civic engagement and good governance watchdogging.

Tuesday, July 11, 2017

Washington Post reports that plans to redevelop the FBI headquarters are being scuttled

FBI Building, Wikipedia photoSee "Federal government cancels costly, decade-long search for a new FBI headquarters."

According to the article:
The federal government is canceling the search for a new FBI headquarters, according to officials familiar with the decision, putting a more than decade-long effort by the bureau to move out of the crumbling J. Edgar Hoover Building back at square one.

The decision follows years of failed attempts by federal officials to persuade Congress to fully back a plan for a campus in the Washington suburbs paid for by trading away the Hoover Building to a real estate developer and putting up nearly $2 billion in taxpayer funds to cover the remaining cost.

... Officials and executives involved in the process also said a lack of permanent leadership at both agencies [the FBI and the General Services Administration] could have hindered the case for funding.
Interestingly, given the alleged interest by President Trump in promoting infrastructure development, this is an example of the incredibly backwards way that the Federal Government handles capital budgeting.

First, unlike state and local governments, the federal government doesn't have a separate capital budgeting process separate from annual appropriations ("The FBI Building as another example of 'I told you so'," and "Town-city management: 'We are all asset managers now'").

This creates distortions in how projects are conceived and scored.

Second, (unfortunately) large projects require specific approval by Congress, and because so many Representatives and Senators believe that "the government is bad by definition" they start from a position of being unfavorable.

I expected this to be a big problem for DC's economy with the election of President Trump and Republican control of both houses of Congress ("Implications of a Trump/McConnell/Ryan Administration on DC's commercial real estate market") and sadly I am being proved right.

Third, this is accentuated by the fact that long term projects are funded from a particular year's appropriations. Which gives rise to arguments that such investments "add to the deficit" rather than add to the economic productivity of the federal government.

Because of this, the GSA did something I thought made little sense, promoting the idea of a land trade "to get a new building for free," which did not work out because it wasn't economically feasible, and it confused the issue.  Note that the Government Printing Office tried the same thing a few years ago, for nought, because again, the economics didn't make sense for the private sector ("GAO-09-392R, Government Printing Office: Issues Faced in Obtaining a New Facility").

Infrastructure is an investment.  Note that the "adding to the deficit" argument is usually fatuous because of the experience of the Civilian Conservation Corps ("Civilian Conservation Corps honored, USA Today), the Public Works Administration and the Works Progress Administration.

From the VCU webpage "The Social Welfare History Project":
Between July 1933 and March 1939, the PWA funded the construction of more than 34,000 projects, including airports, electricity-generating dams, and aircraft carriers; and seventy percent of the new schools and one third of the hospitals built during that time. It also electrified the Pennsylvania Railroad between New York and Washington, D.C. PWA workers built the state capitol building in Oregon, the highway linking the Florida Keys to the mainland United States, the Bay Bridge in San Francisco, the Federal Trade Commission Building in Washington, D.C., the city hall in Kansas City, Outer Drive Bridge in Chicago, the Ellis Island Ferry Building, Washington National Airport and the Grand Coulee Dam in the state of Washington.
Not only did these programs put people to work, these Depression-era "works programs" built significant infrastructure across the country--buildings, roads, bridges--which contributed to the post-war economic resurgence of the US, and many of these projects continue to serve the nation today.

(The right kind of) Infrastructure sets the stage for economic growth.

A chance for reconsideration does have some benefits.  While this sets back redevelopment of the Pennsylvania Avenue corridor by at least a decade, and makes effective management of the FBI that much harder, one good thing could come out of restarting the process--except for the fact that the people running the Executive and Legislative Branches of the Federal Government are anti-government and the Federal Government doesn't have a separate capital budgeting process--new criteria could be set that make keeping the FBI in DC a greater possibility.

Resizing/reallocating space.  In terms of space demands and optimal sizing of agency functions, the FBI could consider dividing certain headquarters/management functions and operations functions and keep the headquarters functions in DC, while relocating certain other functions elsewhere* either in the city or elsewhere in the region.

-- "Intelligent Enterprise," James Brian Quinn
-- Resizing or Right-Sizing?, CCIM Institute
-- "Law firms are 'rightsizing' their office spaces, JLL says," Boston Globe
-- Rightsizing the Multi-Divisional Firm: Individual Response to Change Across Divisions," M@n@gement Journal, Vol. 2, No. 3, 1999, 195-208

While there are many problems now with having federal agencies "in the city" because security requirements usually require that buildings be set apart from the city rather than being integrated within it, agglomeration economies make keeping the headquarters functions of agency in the city beneficial, being close to the Department of Justice, the Department of Homeland Security, ATF, Congress, and other agencies.

Possibly DC could consider trying to lease part of the St. Elizabeths East Campus to the Federal Government for the FBI.  Or maybe, at least for the management/headquarters functions, there would be enough room on the St. Elizabeths West Campus, which remains under the control of the Federal Government.

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* I am in the process of writing a piece comparing the issues of the DC and NYC rail transit systems, and the Southern Rail system in Greater London and Penn Station in NYC, because the issues are different, but too often conflated (e.g., "Call it Metro schadenfreude: As New York's subway woes worsen Washingtonians offer sympathy," Washington Post).

The problem with the NYC transit system is popularity reaching the system's breaking point, while in DC it's about failure to maintain the system and the addition of a new line stretching the system beyond equilibrium.

Anyway, as part of the review of the problems with the London railroad system, the British Government commissioned a review by rail executive Chris Gibb. Reading the report I was struck by what a difference in seriousness, rigor and thoroughness compared to the recent announcement of a million dollar prize "to fix" the NYC transit system by Gov. Cuomo ("Subway upgrade contest from Cuomo to pay $3M to anyone who can fix signals," AM New York).

It's obvious what the problems are with the NYC Subway--they need new signal systems capable of supporting more trains, and continued investment in tracks and equipment. Instead, lack of budget means it will take decades with the current capital program before the signals are upgraded.

The Gibb report made some amazing recommendations ("Gibb report into improving Southern performance published," Railway Gazette), recognizing that when creating the franchise by merging three different railroads, the "program" on offer was not seriously evaluated or "rationalized," and the reality is that the lines compete, even today, so that the timetable is not optimized for efficient operation.

Given that the system (Southern Railway, Thameslink, Gatwick Express) is the busiest in Britain, the various changes put on the franchise, including new equipment and moving to single engineer operation which is opposed by the Union and led to labor action, along with unnecessary duplication stresses the system. 

Given the usage--not unlike the problems experienced in NYC both on the subway and at Penn Station--extra normal shocks to the system like derailments bring everything to a standstill, although in the case of Southern Rail, Gibb argued it was the labor union strikes and other actions that pushed the system to the edge ("Southern rail strike causes worst disruption in 20 years," Guardian).

Five recommendations stuck out to me:

1. Rightsizing the schedule between the services, focusing on the Thameslink brand
2. Retroceding the Southern Metro train line, which functions more as transit for London, to Transport for London, to provide more resources
3. Electrifying the one diesel line, to make common operation possible, and releasing the diesel equipment to other areas, and eliminating the need for investment in diesel-specific storage and maintenance facilities**
4. Possibly selling the Gatwick station to the airport, because it matters more to the airport to invest in the station than it does to the rail system
5. Changing the way hiring and depots are organized, distributing staff around the system in ways that mean more time is spent moving active trains rather than on off-schedule equipment moves

This kind of detailed analysis seems to be out of the scope of similar processes in the US. Instead, there is political grandstanding.


** Similarly, when David Gunn ran Amtrak, he changed the Cardinal--the only train Amtrak created on its own--from ending in DC, to NYC. He did this because NYC had the maintenance equipment already in place for that kind of train and DC did not. Rather than pay for and install such equipment in DC, he routed the train to NYC. Interestingly, not only did it save money, it increased ridership of that train by 40%.

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8 Comments:

At 10:09 AM, Anonymous charlie said...

You could also contrast the McK report that WMATA commissioned -- which also is very very basic (I recognize most of the templates).

And yes -- the one thing I was sure Trump would do is steer business to his buddies -- The Vornado Trade is over.

 
At 11:28 AM, Blogger Richard Layman said...

I forgot to mention Rahm Emanuel's op-ed and CTA, which spurred the development of the yet unfinished piece. His CTA has plenty of issues. That being said they are working on it. He has the benefit of CTA being under the Mayor's control, while the suburban transit and Metra are not. But where they are is a function of "presentism" and very different from the current problems in NYC.

A couple years ago OECD did a study of Chicago area transportation and found lots of problems in terms of integration-articulation. Those problems still exist.

But yes, Chicago is using TIF to create infill stations, talking about fast rail to O'Hare, etc.

WRT to here, I am actually quite proud of a couple of my analyses of WMATA, both financially and in terms of operation--the latter all that much more special because I am not an engineer.

as well as the general point about the value of redundancy in "small systems" since you can't rely on equipment to always be at 100% state of good repair since cars get to be 40-60 years old (albeit reconditioned every so often) and how interlining spreads problems to all the other lines, rather than allowing problems on one line to be contained to that line.

It's far beyond any of the analyses in GGW. cf. McK and remember the call for a "financial turnaround specialist." The financial problems are a symptom...

speaking of NYC, obviously they made a big mistake by not having at least a third track for the Q line, despite the expense, for all those reasons. That will be discussed in the piece.

Emanuel criticized NYC for focusing on "expansion" not recognizing that the 4/5/6 alone carries more people than the CTA, and that the Q extension is designed to provide relief to it. E.g., I wrote a piece a few years ago criticizing Bloomberg et al's desire for more development about Grand Central Station when the subway system was already beyond capacity.

But for there to be the right level of relief, it needed a third track plus the station that wasn't built, etc.

That's the difference between Crossrail in London and the Paris rail expansion program. In Paris and London they aren't taking half measures and calling it better than a full measure.

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I still need to sit down and do a piece on WMATA based on all the various proposals.

 
At 11:47 AM, Anonymous charlie said...

As I've said before, where consultants can be very helpful is realigning incentives.

WMATA is a massive case of perverse incentives (free federal rides, underpaying parking, and bus fares) that needs to be cleaned up.

The McK study was a quick and dirty job to justify enough money coming so WMATA can raise debt.

Debt for preventive maintenance is a horrible plan.

Yes, and this is my point on the highway trust fund. In transportation, we treat fed money as a giant slush fund. We need to actually have a capital budget.

 
At 1:49 PM, Blogger Richard Layman said...

I think at the state level, the highway trust fund is treated more like a capital budget. I was never involved in that kind of work, but there is a lot of back and forth about what gets approved.

It's two tranches, current maintenance, and long term.

Whenever I make this point about capital budgeting and the federal government, I think the way the highway trust fund works is an exception to my general argument.

 
At 2:07 PM, Blogger Richard Layman said...

https://www.bizjournals.com/washington/news/2017/07/12/top-gsa-official-says-fbi-headquarters-search.html

 
At 3:22 PM, Anonymous charlie said...

Well they are right. It was always going to be a bad deal and more money for developers. See the Soccer stadium/reeves push.


"scoring" the leases is another joke.


Again all comes back to capital budgeting -- which comes back to trust.

 
At 2:21 PM, Blogger Richard Layman said...

and the homeless shelters issue, locally. It's a workaround the debt limit. But it makes for real bad decisionmaking.

As we have discussed, DC has the same problem. As witness how capital monies for streetcar were reprogrammed in next year's budget to support various annual budget expenditures.

the thing about reeves/soccer was just as bad as FBI. You don't have to be a financial analyst (I am not) to know that the Reeves trade idea or the FBI trade idea wouldn't live up to the hype of the claims. Because developers deal with real money, not hype, it never worked out the way the govt. types claimed it would.

Of course, with the FBI and probably Reeves (also the police station) I wrote about the mismatched expectations being created, and the likely failure.

It's too bad that it had to play out.

 
At 9:26 AM, Blogger Richard Layman said...

FBI, GSA commit to figuring out what they'll be doing within 120 days.

https://www.bizjournals.com/washington/news/2017/08/02/gsa-fbi-officials-commit-to-120-day-window-to.html?ana=RSS

 

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