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President Obama Shifts Attention Toward Economy, Cities in 2013 State of the Union Address

President Barack Obama (D) delivered the annual State of the Union address last evening. The hour-long speech covered a wide range of topics including gun control, military policy, immigration reform, voting rights, domestic economic programs, education reform, and energy policy.

One of the most-discussed topics of the evening was when the President announced his aspirations to see the national minimum wage raised to $9 an hour. The current minimum wage of $7.25 an hour results in an annual income of $14,500 – a number the President says keeps families with two minimum wage earners below the poverty line.

In 2006, Ohioans voted to raise the state’s minimum wage from $5.15 an hour to $6.85 an hour, with an annual cost-of-living escalator.

“This single step would raise the incomes of millions of working families,” President Obama stated. “It could mean the difference between groceries or the food bank; rent or eviction; scraping by or finally getting ahead. For businesses across the country, it would mean customers with more money in their pockets.”

Brent Spence Bridge Alternative 1

Brent Spence Bridge Alternative 2
The President called for a “Fix-It-First” program during his State of the Union address, but will it make a difference for Cincinnati’s Brent Spence Bridge Rehabilitation/Replacement project? Brent Spence Bridge replacement Alternative 1 (TOP) and Alternative 2 (BOTTOM) renderings provided.

Since the last time Congress voted to increase the federal minimum wage, which is effective for all states that have a minimum wage lower than the federal level, 19 different states have voted to raise their respective rates. The President’s $9 an hour proposal with an annual cost-of-living escalator would place it above every state in the union with the exception of Washington which pays its lowest earning workers $9.19 an hour.

In addition to raising the pay for the nation’s lowest earners, the President also pushed for new programs meant to spur job growth in a new economy. He called for the reform of high school education to more effectively train graduates to be able to fill high-tech jobs.

He also asked Congress to create a network of 15 manufacturing innovation hubs, modeled after the National Additive Manufacturing Innovation Institute (NAMII) established in Youngstown, OH in August 2012. Those cities selected, the President says, would work to partner businesses with the Department of Defense and Energy.

The President stated that the goal is to transform “regions left behind by globalization into global centers of high-tech jobs” in an effort to jumpstart the next revolution in manufacturing.

The advanced manufacturing policy proposal is one that should certainly catch the attention of local policy leaders as they work to transform Cincinnati’s Mill Creek Valley into a productive economic engine for the 21st century, as laid out in the Growth & Opportunities Cincinnati Plan published in 2008.

Another point of emphasis during the President’s first State of the Union address of his second term revolved around repairing the nation’s existing built environment.

To that end, he discussed retrofitting buildings to become more energy efficient, and announced a goal to cut energy wasted by homes and businesses in half over the next 20 years. President Obama continued by calling for a program that would prioritize infrastructure spending on existing assets in need of repair, like Ohio and Kentucky’s combined 4,054 deficient bridges.

“I propose a ‘Fix-It-First’ program to put people to work as soon as possible on our most urgent repairs,” said President Obama. “And to make sure taxpayers don’t shoulder the whole burden, I’m also proposing a Partnership to Rebuild America that attracts private capital to upgrade what our businesses need most: modern ports to move our goods; modern pipelines to withstand a storm; modern schools worthy of our children.”

Perhaps the biggest bi-partisan applause of the night went to the President’s condemnation of gun violence and call for action to prevent further atrocities like those at Sandy Hook Elementary School, and those that occur on the streets of America’s cities every day.

“Our actions will not prevent every senseless act of violence in this country. Indeed, no laws, no initiatives, no administrative acts will perfectly solve all the challenges I’ve outlined tonight,” President Obama clarified. “But we were never sent here to be perfect. We were sent here to make what difference we can, to secure this nation, expand opportunity, and uphold our ideals through the hard, often frustrating, but absolutely necessary work of self-government.”

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Cincinnati named finalist to become WWF’s 2013 Earth Hour City Capital

Cincinnati named finalist to become WWF’s 2013 Earth Hour City Capital.

The World Wildlife Fund (WWF) has put together a list of the cities participating in the Earth Hour City Challenge. Within that list, WWF lists Chicago, Cincinnati and San Francisco as the three finalists in World Wildlife Fund’s Earth Hour City Challenge for 2013. More from World Wildlife Fund:

The cities were chosen by WWF and global management consultancy Accenture in recognition of the steps their community has taken to prepare for increasingly extreme weather and transition towards a 100% renewable energy future. The finalists were selected among 29 of the most forward-thinking cities in the country which have all committed to minimize their carbon footprint and ready their communities for the dangerous local consequences of climate change.

Cincinnati is developing a power aggregation agreement that would make it the largest city in the U.S. to supply its energy entirely from renewable sources and committing to reducing carbon emissions two percent annually for 42 years. The city is also working with residents, businesses and community leaders throughout the city to adopt climate-smart policies; expanding current tree planting efforts, promoting metro ridership, educating students about sustainability and conducting energy audits for local non-profits.

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Business Development News Politics

Inner-City Neighborhoods Center of Population, Economic Power in Cincinnati Region

The Cincinnati region has been one of the nation’s best economic performers over the past several years, and that has resulted in a 6.4% unemployment rate that is more than a point better the national average.

According to the U.S. Census, more than 968,000 jobs are scattered all over the region, but it is the City of Cincinnati that stands out as the dominant force for the 2.1 million person region.

As the numbers in the City of Cincinnati’s 2013/2014 Biennial Budget Report show, the financial standing of the central business district is critically important to the overall financial health of the entire city and county. According to the report, income taxes brought in $234 million last year – nearly 71% of the City’s total revenue in 2012.

Cincinnati Employment Density Cincinnati Employment/Population Share
While outlying suburban communities have seen an influx of jobs over the past 30 years, Downtown and Uptown remain the region’s preeminent job centers. Employment Density Map and Employment/Population Share Map by Nate Wessel for UrbanCincy.

In the Cincinnati Metropolitan Statistical Area (MSA), center city neighborhoods account for the highest concentration of jobs, with more than 22,000 jobs per square mile in Downtown’s 45202 zip code, and anywhere from 3,000 to 9,000 jobs per square mile in Uptown neighborhoods.

“Downtown and Uptown are the City’s largest employment centers and therefore they are very important to the City’s financial health,” said Lea Ericksen, Cincinnati’s Budget Director. “We want all our neighborhoods to improve tax earnings by increasing residents, jobs and overall economic vitality, but we are focused on the six GO Cincinnati strategy areas for redevelopment.”

Cincinnati’s 2.1% income tax largely goes to support the General Fund which pays for operating expenses like police officers and fire fighters. Smaller percentages also go to pay for public transit operated by the Southwest Ohio Regional Transit Authority (SORTA) and capital investments in City buildings and infrastructure.

Ericksen projects that while income taxes will remain the same, they will grow in value by approximately 2.6% annually over the next six years.

Income & Property Tax Earnings (2004-2016)
The City of Cincinnati has experienced steady growth in income tax revenues since 2004, but it has struggled to recover from the previous decade’s housing crash. Chart produced by UrbanCincy.

Property taxes are the next largest revenue generator for City Hall – accounting for $23.9 million in 2012. City officials expect this number remain stable over the next four years following an initial $7.8 million annual bump should the current property tax rollback be eliminated and set at 6.1 mils.

Like the clustering of jobs in the city’s urban core, the most heavily populated neighborhoods are also located within the center of the region.

“People are very interested in center cities, and we have an exceptionally attractive center city,” David Ginsburg, President/CEO of Downtown Cincinnati Inc. told UrbanCincy. “The architecture here and the geography that we have being in the valley. We just have a compact, spectacular downtown, and I think we have barely touched the surface of what the market can bear.”

Some of the most valuable residences are located along the central riverfront and eastside neighborhoods, with recent growth in northern communities in Butler and Warren Counties.

Cincinnati Population Density
Several neighborhoods boast densities of 7,000 or more people per square mile, and those neighborhoods are all centrally located. Population Density Map by Nate Wessel for UrbanCincy.

Uptown neighborhoods surrounding the University of Cincinnati and Xavier University, Downtown/Over-the-Rhine, and close-in neighborhoods on the westside and along the Northern Kentucky riverfront are the most densely populated in the region.

“We’ve seen quite a bit of where we rehab a home, the neighbor decides to rehab their home,” Ken Smith, Executive Director of Price Hill Will, said about the development corporation’s Buy-Improve-Sell program which has rehabilitated 52 thus far in 30,000-person neighborhood, on episode 14 of The UrbanCincy Podcast. “People are very impressed with the housing stock in the neighborhood, and they are often quite impressed.”

Not all is well, though, for city leaders as they attempt to recover from the housing crash that took place between 2006 and 2010. Neighborhoods like East and West Price Hill are aggressively working to improve their residential housing stock by getting rid of vacant units even by taking advantage of hundreds of demolitions planned throughout the city.

“We are working with the Hamilton County Land Bank to get these empty lots into hands of those next door, but there are going to be a few houses that I wish we could save, and in better times maybe we would have the money to save it, but in better times they may not have gotten to that point,” explained Price Hill Will’s Matt Strauss, Director of Marketing & Neighborhood Promotion at Price Hill Will. “The goal is not only to bolster owner occupancy, but to increase property values in the neighborhood.”

Listen to episode 14 of The UrbanCincy Podcast with the leaders at Price Hill Will to hear more about the work being done on the westside to recover from the housing crash, and episode 15 with David Ginsburg to get the latest insight on the region’s economic engine. You can stream our podcasts online or subscribe to our bi-weekly podcast on iTunes for free.

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Washington D.C. plans $26B rail investment as Cincinnati moves on first

Washington D.C. plans $26B rail investment as Cincinnati moves on first.

As Cincinnati moves forward with construction of the region’s first rail transit, many residents are now looking forward to what might be next, and how to best connect the growing metropolitan area via rail. Meanwhile, in the nation’s capital, the Washington D.C. Metro has proposed $26 billion worth of upgrades to its already extensive system. More from the Washington Post:

Metro’s top managers are proposing a new rail tunnel under the center of the District, a second tunnel under the Potomac, and they estimate the transit agency will need $26 billion over the next three decades to pay for those and other improvements to an aging system that is falling behind the region’s needs.

The proposed new rail tunnels — one under 10th Street to Thomas Circle and another between Rosslyn and Georgetown and on to Thomas Circle — would be massive undertakings. The projects would require major financial commitments from local and federal governments and would take several years to plan and several more years to complete.

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Would elimination of the gas tax increase infrastructure investment?

Would elimination of the gas tax increase infrastructure investment?.

With user fees only covering approximately 51% of the costs to build and maintain roads, some are suggesting it’s time to change the way we fund our transportation infrastructure. One of those suggestions is to get rid of the gasoline tax altogether. More from Bloomberg:

As a result, “getting back our share” has become the key objective, so that every state now gets as much (or more) money in transportation grants as it pays in federal gas taxes. Along with the money, the federal government issues various rules for spending it, many of which require the states to put in some of their own money, too. It’s common to hear state transportation officials say that the feds provide 25 percent of the money and 75 percent of the hassle.

Eliminating the federal role would enhance state autonomy and streamline decision making. What’s more exciting is that it would also lead to more and better spending on transportation. In poll after poll, Americans say they are willing to invest in roads and bridges, as long as it brings about improvements they will use. This isn’t just talk; state and local referendums on raising taxes or issuing debt to pay for transportation projects usually pass.

However, people don’t generally support raising the gas tax, for the simple reason that they think their current gas taxes, which are mostly federal, are wasted. Thus, the federal gas tax has become both a ceiling and a floor. It makes raising state gas taxes unpalatable. And since states get back at least what they contribute, the tax encourages them to keep spending even if they don’t really need more roads.