Wednesday, December 12, 2012

Financing Green Urban Infrastructure

Cities play a critical role in planning and investing in urban infrastructure. In many cases, local governments have authority over the selection of infrastructure projects made at the municipal level. Therefore, they exercise influence over the nature of infrastructure renewal and expansion, and have the ability to promote greener and more sustainable urban centres.

Their leadership role extends to the kinds of investment mechanism selected to finance, for example, improvements in the transportation, building, waste and water and, to a lesser extent, energy sector. Because cities have revenue sources that are tied to many aspects of these sectors, their design can stimulate or dissuade the development of greener and more sustainable cities.

Click to view report (pdf)

The greening of municipal financial instruments, such as congestion charges, variable parking fees, toll lanes and split-rate property taxes, is an important first step toward achieving greener urban infrastructure. Public sector financing, however, may not be sufficient to stimulate a paradigm shift. Therefore, the second critical step is to mobilise private sector investments to fill funding gaps for many urban green infrastructure projects.

There are certain conditions that need to be put in place in order to attract and capture private sector investments.

The three main conditions are:

  • markets for green urban investment projects,
  • good return on investment and
  • limited risk.

Cities and countries differ with respect to these conditions; as such, some of these instruments could be more appropriate for cities in industrialised and medium income countries than lower income developing countries, for which grants, loans and other development finance instruments could be more relevant.

Further information
For more information about OECD’s study, please contact Olaf Merk in OECD’s Public Governance and Territorial Development directorate by e-mail: or phone +

Tuesday, December 11, 2012

Cities and Climate Change Contacts

La Federación Latinoamericana de Ciudades, Municipios y Asociaciones de Gobiernos Locales, FLACMA es la representación regional de la organización mundial  de Ciudades  y Gobiernos Locales Unidos, CGLU.

Cumbre sobre Liderazgo de los Gobiernos Locales en el Cambio Climático
Hosted by the  Local Government Denmark (LGDK) which is the interest group and member authority of Danish municipalities.

Local Government Climate Change Leadership Summit
Copenhagen, Denmark.
The Summit sent a united message on the role of municipalities and regions throughout the world in combating climate change. The organizer – Local Government Denmark – would like to thank co-organisers, speakers, exhibitors and not least the more than 700 participants for all the contributions that resulted in a successful Summit.

The Local Governments for Sustainability
Climate Roadmap
Leading local government associations world-wide which represent communities around the globe, are driving the Local Government Climate Roadmap; a process that started during COP 13 in December 2007. The Roadmap advocates for a strong and comprehensive post-2012 global climate agreement, which will hopefully be adopted during COP 15 in Copenhagen (Denmark), in December 2009.

Latin America and Caribbean Web site
Local government associations in the international climate negotiations aim to emphasis the crucial role of cities and local governments in climate protection, and want this key role to be recognized in the post-2012 climate regime.

Housing Authority

La Comisión Nacional de Vivienda es la instancia federal encargada de coordinar la función de promoción habitacional, así como de aplicar y cuidar que se cumplan los objetivos y metas del gobierno federal en materia de vivienda, plasmados en el Programa Nacional de Vivienda 2007-2012: Hacia un desarrollo habitacional sustentable

Fundación para la Vivienda Progresiva (FVP), a partner of CHF International

Fondo de Operación y Financiamiento Bancario a la Vivienda
FOVI es un Fideicomiso Público constituido en 1963 por el Gobierno Federal a través de la Secretaría de Hacienda y Crédito Público en Banco de México, el cual es administrado por la Sociedad Hipotecaria Federal, S.N.C. a partir del 26 de febrero de 2002.

The International Union for Housing Finance (IUHF) is a primary source of information for trends and innovations in housing finance and mortgage lending from around the world. In doing this, we hope to increase the rates of home ownership globally by expanding the availability of mortgage credit.

World Bank
Housing and Land Development

Harvard Joint Center for Housing
Current Housing Situation in Mexico 2005
Prepared by Centro de Investigacion y Documentacion de la Casa (CIDOC) and Sociedad Hipotecaria Federal with support from Comision Nacional de Fomento a la Vivienda and Joint Center for Housing Studies of Harvard University.

Inter-American Development Bank
Effects of Land Titling on Child Health

Economic Development

Economic development is an elusive topic because it embodies various aspects of life. This essay will try to define the term, distinguish it from economic growth, and describe related theories and tools. Finally this essay will provide policy suggestions for specific target business and certain beneficiaries of South Florida’s low-income areas.
Economic growth is centered on the short-term expansion of the local economy by creating jobs, adding additional business, and increasing the household median income (or GNP at the country level). In general, growth models are concerned with stimulating business cycles, attracting new business and creating employment. Tools used evaluate the industrial mix, the export industries and the rate of growth in a particular locality (Malizia & Feser, 2000, pg. 244). “Growth typically leads to more employment and aggregate income, a larger tax base, and higher property values,” (Malizia & Feser, 2000, pg. 248). Therefore, the role of institutions, like the Beacon council or similar Chamber of Commerce, who measure the increases in jobs in a specific area are promoting economic growth and not development.
Economic development is a long-term process. City planners and economic developers use analytical tools (like shift share analysis) to understand the longer trends in a local economy and make comparison with other areas (reference economy). They are more concerned with competition to other areas than the short-term gains in a particular market. Economic developers are not only interested in income level, but also the distribution of wealth (equity) and its long-term stabilization. They look at growth trends, studying their origins, spurts, and outcomes.
The bottom line, if there is no growth, there will be no economic development. Specifically economic developers are interested in the diversity in the market place, centrality to information and transportation hubs and resiliency for producing goods efficiency with a skilled labor force. Most notably, economic developers do not create jobs, but facilitate their creation by providing a good quality of life, promoting a investment climate, offering credit to start-ups and servicing the public in their perceived business needs. Essentially, economic developers must adjust their strategies to their local realities, including their labor market, universities, business climate, centrality or access to transportation hubs and the like.

This essay argues that the government should intervene in the market place. Encouraging economic development consists of “federal polices like taxation, monetary policy (interest rate, money supply, strength of dollar), trade, welfare, healthcare, employment/training, environmental regulation and funding” (Revell’s notes). If government did not intervene with subsides, regulation, tax, management or other controls: businesses would heavily pollute; the value of the dollar could become unstable depending on marketplace woos; trade with foreign countries would be sporadic; and citizens would not receive proper healthcare, education and training, so necessary to confront the ugly neo-classical world. Although the counterfactual, and a more radical view, is noteworthy, often intervention perpetuates wealth within the small space of the few involved, whether they are in business or government (Blair, 1995, pg. 7). Therefore citizens of a country should be mindful and watch this effect closely.
Theories are used to understand how and why economic development happens. Although they are not always directly used in practice, they may assist policy makers define their agendas (Malizia & Feser, 2000, pg. 255).  For example, economic base theory suggests that local economies consist of basic industries and non-basic that support a high quality workforce. The non-basic industries, including services like a laundry mat, specialty shops, restaurants and entertainment places, drive the character of the local area and basic industries drive the growth. Economist use location quotients with SIC/NAICS data to determine which industries are located in their area. This can help identify business located in a region and construct comparisons to the reference economy. The export-lead businesses are typically highlighted by government agencies to generate new capital into an area. They use industrial recruitment, promotion to diversification and growth of forward and backward linkages for developing good local multipliers and generate the promotion of clusters (Porter, 2005; Revell’s notes). Public policies to promote increased efficiency in public services are typically used.
On the other hand there are newer theories to promote growth. They include endogenous growth theory, production cycle theory, entrepreneurship and human capital theory. These theories promote the creation of a new type of worker, with higher-level human capital, skills and entrepreneurship, who invent new technologies, which will drive the production cycle to new levels. These individuals start at the top of the cycle, as consumers use more products, they will earn higher prices for inventing new products and services, pushing the cycle to new levels. Florida suggests local governments should attract this new “creative class” by changing traditional policies of industrial recruitment and creating an “eclectic” environment (Florida, 2002). The past polices suggested creating workforce training centers, universities and technical colleges, and employment services for connecting the talent to the job market.  Florida’s radical policy change has generated many critiques. As an economic developer, it is too soon to tell whether his model works and cities should change totally adopt his mantra. 
There should be at least three-prong approach to policies for south Florida. They include: a) the promotion to current businesses and the attraction of new ones; b) research of target industries and promotion of clustering; and c) the engagement of an integrated welfare-to-work approach for the very poor. Next I will outline each and define their target communities and strategies to meeting the needs.
First, although typically seen as unfavorable, South Florida needs an active Chamber of Commerce or Beacon council type facility, which provide advertisements, promotion materials, but also engage the private sector to do business in the region (to keep the competitive advantage). They should be most interested in growth with the increases of community’s numbers of jobs. Their target audiences are businesses.  But I would transform the current organizational structure into a Community Development Corporation. This more inclusive non-profit community based organization will not only do the development promotional activities, it will also have a public-private board of directors including business representatives and citizens. Their work will include activities from filing for tax credits of the enterprise zone initiative to paining older façades in developing areas. This will require citizen’s involvement in their mission, vision and work plans. This inclusive model will cut the insular feel of the current institution and hopefully solicit new ideas for and from the community.
Next, the region should engage in synergies between research centers at university, government officials and businesses. The core audience should be long-term development planners.  This is Michael Porters use of target industries studies and cluster analysis (Porter, 2005, pg.17).  For example, it would encompass The Metropolitan Center’s Target Industry Study, which provided an assessment of growth and competitive of existing industries in Miami. By using NAICS data, the center identified the motion picture, furniture and plastics as places for potential industrial development. Inconsequentially, all of these industries could be categorized as Richard Florida “Creative Class.”  Beyond the method of analysis, the Metropolitan center, or similar public-private partnership think tank on innovation for the region, should promote and define specific policy to promote these areas, which have potential growth in the region. They could include policy recommendations like: 1) start developing the FEC corridor as mix used space; 2) create workers guilds in the identified geographic areas of motion picture, furniture and plastics industries; 3) set up an incubators, industrial parks and tax-free areas for locals to meet and interact; 4) design user-friendly open spaces for artist to display their work and create community support; 5) promote products by hosting trade shows and fairs. Finally as the study suggests the city could develop a Business Development Office within the City’s Department of Economic Development to provide economic assistance for small business in the FEC Corridor and develop a Mayor’s Invention Award to advertise the Mayor’s progressive work in this area.
Finally at the local level, I would prescribe a Wisconsin’s welfare-to-work model program aimed at getting jobs for the poor.  This consists of job banks, technical training programs, assistantship, and promotion of apprenticeship programs.  The jobs banks should facilitate computerized systems for linking jobs to the unemployed. They should offer daycare facilities, transportation vouchers and be linked to other social service assistance like signing up for Medicare and Medicaid, aids testing, driver’s licenses services, etc.  These one-stop shops aim at the poorest of the poor, in order to help them find jobs in the neo-classical economy and doggy-eat dog world.

Miami-Dade County Government

Briefing Paper describing the basic structure of Miami-Dade County Gov.

On January 26, 2007, Miami-Dade County implemented the Home Rule Amendment and Charter, allowing the County to be managed by a Strong Mayor.  This amendment, voted by the people of the County, radically revolutionized the potential for the Mayor’s role in advocating public policies for the regional area. This amendment passed changed 50 years of Council dominated management.  This essay will attempt to explain how the mayor, commissioners, and the county manager are chosen and what powers and responsibilities they have in the new form of government.
It is first noteworthy to mention, cities are not mentioned in the US Constitution. (Revell’s notes) Rather their autonomy and management is appropriated at the State level. Thus fulfilling the constitutional dreams of our Federalist fathers like Alexander Hamilton, James Madison and John Jay. The United States is just that, a unification of autonomist states that share the vision of unity.  Furthermore, the State Florida applies Home Rule, which means cities have self-determination of making decisions.  Home Rule fosters the devolution of authority. This is different than the Commonwealth of Virginia, which makes codes and regulations at the state level and mandates cities and counties to follow them. Commonwealth’s promote a consensus of the people for its policies mandated.
Not without standing, the State of Florida adopted Home Rule on November 6, 1956, making it remarkable that the county of Miami-Dade had not changed its authority structure in more than 50 years. (Miami –Dade adopted the home Rule Charter just a few months later in May 21, 1957, which further illustrates the devolution of power) . Furthermore, the Strong Mayor initiative came from the current Mayor Carlos Alverez in 2007, from his experience as police chief in the county.
The Strong Mayor form of government allows the mayor to have complete administrative authority. He or she can hire and dismiss all department heads without council approval, prepare and administer the budget, suggest ballot referendums, and manage all administrative aspects of the city. The Mayor’s most important job is to provide big picture policy initiatives and has the authority to veto the council’s legislation.  This is a simulation of the executive power of the Presidency.
The mayors’ rights and responsibility are also key. He or she may not be a member of the commission, but is elected with a direct vote from the people. The mayor reports his policy ideas and budget to the council every year.  His major role is in setting funding priorities by working with his appointed professional staff. Typically this includes the County Manager but it may also include a Chief Administrative Officer—often for larger cities—in addition to directors of finance, personnel, parks and recreation, clerks and circuit court members, etc. (Revell’s notes) Furthermore, as stated in the statute, the elected mayor must have lived in the county for at least three years before qualifying for the job, thus suggesting his alliance to the people. (Article 2 Section 2.01)
The County Manager is the right hand person to the mayor. This professional administrator reports directly to the Mayor (Article 4). It is important that the county manager is not a political position, but rather selected for his or her administrative capacity to run the city. Often times, the manager handles “operational duties”, while the mayor perform political event of “ceremonial capacity.” (Revell’s notes) The non-political nature of the county manager is important as to end the spoils system and the political machine where one political party operates and provides “benefits” to those who follow them.  Although potential collusion is still a threat with the Strong Mayor system, the Commissioners’ watchful eye is an important factor for evading corruption.
Each voting district selects a member of the Board of County Commissioners. The board is the governing body for Miami Dade County. They have the power collectively to set the county’s boarders, its name, and provide function and authority to any smaller level of government including municipal corporations. For example the board can create the special taxing districts that allow for chambers’ of commerce (the Beacon Council in the case of Miami Dade County) to attracted business and promote growth. The Board may abolish any units except school districts superintendents, Circuit Court or any other court’s actors, like the judges, clerks, etc. Furthermore, the Board has the power to override any of the laws created by these special districts if it so chooses. For that matter, the power that overrides the Board of County Commissioners is that of the State of Florida. It operates as a proxy senate for the regional area, but must abide by the State’s laws.
The Home Rule charter suggests the Board is in charge of the personal welfare of the citizens living in the county.  That includes the provision of health and welfare programs like housing, pollution control, and regulation of sewage and the water supply. The members do their job through levying and collecting taxes, barrowing money by issuing bonds and revenue certificates. They also provide licenses, maintain central records, regulate public transport and train fire fighters, among other things.
 There are only a few limiting powers of the Board. The largest is that it may not be a member of Public Utility and Railroad Commissions (managed at the State level). This is because the Board provides and regulates public goods for the citizens like toll-roads, bridges, tunnels, air, waterways and bus terminals. (Article 1: Section 1.01) The duplication of rules creates a conflict of interest and if not corruption, the perception thereof.
Additionally, the Board prepares and enforces the comprehensive plan for developing the county. This is particularly important to relate to the class of economic development and community renewal.  The Board of County Commissioners establish, coordinate and enforce zoning; issue licenses; regulate, control and manage franchises for the implementation of public services (mentioned above). They are in charge the special assessments and general tax levying districts used to attract new business for tax collection. Interesting, the Board must use 2/3-majority vote to select a franchise to manage public services, but it cannot operate light, power or telephone utility. (Article 1: Section 1.01.14) Otherwise, technically the County can run any free business it wants, just as long as it returns the wealth back to the community. The Board does mange these operations and its public employees through performance standards. It may also contract subunits to manage these operations. Furthermore it can use public funds to promote and advertise the development of the region.
The Board’s role in the use of eminent domain is vital in the future of economic development for the region. This vital tool allows the Board to “condemn property for public purposes.” (Section 1.01.14) The process of taking private property and using for public utility is of great debate in the State of Florida especially after the Supreme Court Case of Kelo vs. The City of New London. (Revell’s notes) Such occurrences have developed highways, railroads and now recently a strip-mall to generate wealth for the state.
The separation of power and authority between the various official positions is important as to eliminate and minimize the potential for corruption. This foundation of the American democratic system not only applies to the Federal level, but the roles and responsibilities of how our cities are run. This essay has tried to argue the current Strong Mayor position has created a further separation of power, while creating an elected official over all accountable to the bureaucracy that runs Miami Dade County—a job that thirteen current Board of Commissionaires are less capable of doing with efficiency and efficacy. Rather their support and supervisory role to the Mayor is appropriate to ensure that all the voices are heard in Miami Dade County.

Making Bonds Work

Are governments always O ver-Indebtedness and Fiscally Irresponsible? Governmental debt and financial sustainability are pressing i...