Saturday, November 14, 2015

Bay Area needs powerful regional government to keep economy vibrant, study says

Bay Area needs powerful regional government to keep economy vibrant, study says

By Andrew

The solution is more centralized government.  What possibly could  go wrong?

The Bay Area generates one of the brightest sparks in the nation's recovering economy, but feeding its vitality means residents will have to give up some local control, dig deeper into their wallets, and make room for tens of thousands of new neighbors, according to study released Friday.

Keeping on prosperity's path requires a regional government with power to overcome local obstacles, money from new taxes and tolls, and opening the doors to housing closed by local growth controls and state environmental red tape, according to "A Roadmap for Economic Resilience," an in-depth study done by the Bay Area Council Economic Institute.

Without action, the Bay Area's highways choked with commuters, its fragmented transit systems, and anti-growth attitudes will choke the boom times, the report says.

The Bay Area may have 101 cities, "but it is one economy with more than 7 million people," says Bay Area Council President Jim Wunderman.

"No city can perceive itself as an island. It's time for policymakers and business leaders to think and act with a regional perspective ... to maximize our many assets and keep the economy growing," he says.

The Bay Area Council is a business-sponsored public policy advocacy group.

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A key concept is the creation of a powerful regional government -- "a regional planning, finance and management" agency -- funded by tolls on bridges, highways and express lanes and a regional sales tax, gas tax, or vehicle license fee.

According to the study, the regional agency would develop "a stronger regional approach to addressing critical needs (of) infrastructure, housing, workforce training, and economic development."

(Late last month, an attempt to expand one regional agency's powers in this direction resulted in a pact to study merging the Metropolitan Transportation Commission and the Association of Bay Area Governments.)

Loss of local control, a new layer of government and more taxes are warning words for groups that monitor taxpayer burdens.

"Why do they need additional revenue?" asked Jon Coupal of the Howard Jarvis Taxpayers Foundation. "If some functions shift to a regional government, shouldn't the revenue stream follow?

"California remains a very, very overtaxed state," he said. "It has the highest sales tax and highest gas tax ... and a great deal of mismanaged tax revenue."

Tax increases might result in improvements, but much of the money will go to fund public employee pensions, he predicted.

But he also sees a need to protect the area's economy. "Most of the major chip manufacturers have left California," he said. "A lot of high tech is moving to Denver and Salt Lake City, and a lot of biotech is moving to Salt Lake." Housing, a key to developing the workforce and easing commute strains, is in crisis: There's too little of it and it costs too much, the report finds. The Bay Area needs nearly 1.3 million housing units built by 2040 to meet demand, and there should be consequences when cities fail to meet state-mandated housing goals, such as loss of local authority to approve housing, the report advises.

The plan includes the long-sought goal of easing environmental protection laws that hinder speedy construction or block building entirely.

"It shouldn't be read as the region vs. cities," said report co-author Micah Weinberg, a council senior policy adviser. "It should be 'How can we make it easier for cities to do the right thing by residents of the region?'"

Reducing construction costs would be packaged with quicker approvals for lower-cost construction and new building technologies, and capping fees throughout the region.

Coupal called the state's building permits and mandates absurd.

The housing crisis is a "self-inflicted wound," he said. The report does not consider actions suggested by other factions in the Bay Area's growth debates, such as making businesses that rely on commuters help pay for their transportation and housing needs.

That's a nonstarter for Weinberg and Wunderman.

"When you start to pick off individual businesses, it does not scale," Weinberg said. "You need the scale of a state or region to make the investment you need in transportation."

Wunderman said the world economy is too dynamic to risk the Bay Area's momentum.

"If you have jobs, you can solve problems. ... The last thing you want to do is put the brakes on the economy."

Contact Andrew McGall at 925-945-4703. Follow him at

Economic resilience
"A Roadmap for Economic Resilience" sets six actions needed to sustain the Bay Area's economic growth and to prepare it for natural disasters.

  1. Create a regional infrastructure financing authority with the power to play a stronger role in regional transportation finance and planning.
  2. Give the regional authority enhanced power to acquire funding.
  3. Coordinate the building of large-scale water recycling, desalination, and storage infrastructure through a regional entity.
  4. Lower the voter threshold for county infrastructure taxes to 55 percent.
  5. Establish a separate environmental review process for infrastructure.
  6. Plan for resiliency in all infrastructure decisions (to prepare for and react to natural disasters)

The full report is online at

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