The Urbanist #515 - July 2012 - Why California Needs High Speed Rail

DIRECTOR'S LETTER

O SPUR SPUR BOARD OF DIRECTORS Chair LindaJo Fitz Executive Vice Chair AnneHalsted Vice Chairs Alexa Arena Andy Ba rnes Emi lioCruz David Friedman Bill Rosetti LydiaTan V. FeiTsen Secretary Mary McCue Treasurer Bob Gamble Immediate Past Co-Chair Lee Blitch Advisory Council Co-Chairs Michael Aiexander Pau l Sedway

Board Members Carl Anthony Vero nica Bell ChrisBlock La rry Burnett MichaelaCassidy Madeline Chun Charmaine Curtis Gia Daniller-Katz Kelly Dearman Oz Erickson Manny Flores GillianGillett Chris Gruwell Dave Hartley AidanHu ghes Mary Huss ChrisIglesias LaurieJohnson KenKirkey Dick Lonergan Ellen Lou JanisMacKenzie John Madden JacintaMcCann ChrisMeany EzraMersey

Terry Micheau Mary Murphy Jeanne Myerson Adhi Nagraj BradPaul ChrisPoland TeresaRea Byron Rhett Wade Rose Victor Seeto ElizabethSeilel Ca rl Shannon Chi-HsinShao Ontario Smith Bill Stotler Stuart Sunshine Michael Teitz MikeTheriault JamesTracy WillTravis JeffTumlin Steve VetteI DebraWalker CynthiaWilusz Lovell CindyWu

CHAIRS & COMMITTEES Program Committees

Regional Planning Finance Larry Burnett Bob Ga mble Libby Seilel Ballot Analysis Human Resources Mary McCue Bob Gamble Operating Disaster Planning Committees Individual Membership LaurieJohnson Audit ChrisPoland Bill Stotler John Madden Housing Investment Nominating Ezra Mersey Ann Lazarus Stuart Su nshine LydiaTan Major Donors Building LindaJo Fitz Project Review Management CharmaineCurtis Anne Halsted La rry Burnett Mary Beth Sanders PlannedGiving ReubenSchwartz Business Michaela Cassidy Membership Transportation TomHart Silver SPUR AnthonyBruzzone Terry Micheau DaveHartley Water Policy Board TeresaRea Executive Bry Sa rtre AnneHaisted GoodGovernment LindaJoFitz BobGamble

SAN JOSE ADVISORY BOARD Andy Barnes ChrisBlock J. RichardBraugh Larry Burnett BrianDarrow Gordon Feller

2

JULY 2012

KarlaRodriguez LydiaTan KimWalesh Lomax James MacGregor JessicaZenk ConnieMartinez Anu Natarajan MohammadQayoumi

High Speed Rail: Le 's Sui It Faster Swirling debates about state budget def icits, crumbling infrastruct ure and federal funding for high- speed rail not with standing , th e fact remains th at California is a wealthy state that is home to Hollywo od and Silicon Valley. If we can be home to industri es th at reinvent our int eracti on wit h th e world, we can certa inly figure out a way to pay for a four hundred mile tr ain linking north and sout h.

Earlier this year, SPUR Executiv e Director Gabriel Metcalf and I were asked to speak at a nationa l megaregion confere nce sponsored by Egon Terplan American 2050, th e Regional Plan Associatio n's nat ional platform for Regional Planning high-speed rail and long-term infras tructu re planning for th e country .

Director Our talk argued t hat Californ ia's t wo most iconic economic brands: Hollywood and Silicon Valley are beginni ng to converge economically even as firm s in each place are in int ense compe t it ion over fut ure contro l of content distribution .

The economic int egration of Silicon Valley and Hollywood was prop osed as an admittedly provocative metaphor for why we need high-speed rail to bett er connect t he state. But couldn't connect ing north and sout h via rail futh er help th e int egration of both reg ions? And do so in a more environmentally and spatia lly enhanced way?

But the story of Hollywood and Silicon Valley also offers insight into th e economic streng ths of the state and our ability to pay for infrast ructure on our ow n. Californi a is a two-tril lion-dol lar-per-yea r year economy wit h exports in entertain ment and technology at th e foref ront globally. We are th e largest economic unit in the world (ot her th an Brazil) with out high- speed rail in operat ion or under const ruct ion. Given th at no count ry yet is regretting it s decision to build high -speed rail, we think it is well past tim e for us to get started on our own high- speed rail proj ect.

We recognize that a signific ant porti on of th e bud get for th e high- speed rail system is not yet fund ed. The 2012 business plan assumes $38 bi llion in federal government funding over th e com ing two decades. Whil e we certainly hope th e feds do come th rough in th e coming years, we believe California can fund high -speed rail on it s ow n. We selff unded much of our extensive highway system over half a centu ry ago; we can self-fund much of high-s peed rail today .

The questio n remains whet her or not we have th e political wil l to find local sources of fun ding for high -speed rail. "Get ting High-Speed Rail on Track" (p , 4) explores several funding tools such as increasing th e gas t ax, capturing value fr om new development at stat ions or establishing highway toll s. We offer th ese funding tools not as a complete list but as an illustration of what is possible.

This issue of The Urbanist is int ended to provoke debate. There are many reasons to build high- speed rail other than to connect wo rkers in Silicon Valley and Hollywood. There are also many other sources of funding for th e train system's constr uctio n in addit ion to the ones we identify. Ultimately. t he faster we build th e tr ain system. th e less expensive it is (and t he sooner we reap its t ransformat ive benefits) . The $68 billion price tag in the 2012 business plan is quote d in "year of expendit ure" do llars and assumes we take a generatio n to build th e system. This is California; let's build it faster. •

TH E URBANIST

JULY 2012

News at SPUR San Francisco's Transit Center District Plan Moves Toward Adoption On May 24, the San Francisco Planning Commission voted 5-1to cert ify the final draft of the environmental impact report t hat will move the Transit Center District Plan forward to the Board of Supervisors' Land Use and Economic Development Committee . The commission also voted to approve amendme nts to th e General Plan, planning code and zoning code that will

wi ll run along Fourth Street, stopping at Brannan and Folsom. There is much to like in t he new plan concepts - includin g zoning that

be necessary to implement t he transit plan, which wil l go before t he Board of Supervisors

encourages off ice developm ent and ot her job- generatin g uses, as

in July. The Transit Center Distr ict consists of appro ximately 145 acres surrounding the new

well as sign ificant imp rovements in

Transbay Transit Center, currently under construction; th e transit plan will enhance the area's established patterns of land use, urban form and public space, creating a vib rant new neighborhood. The Transbay Transit Center, t he centerp iece of the plan, wil l not only provide expanded bus faci lit ies; it wi ll also include an undergro und rail station to serve as theSan Francisco ter minus for Caltra in and California high-speed rail. SPUR has long suppo rted

th e pub lic realm . However, SPUR believes that the plan does not go far enough in suppo rt ing sufficient height s near th e new subway.

There-are very few parts of the cit y that benefit from so much good t ransit - we need to make t he most

t his plan, recogni zing its poten t ial to t ransform San Francisco and th e regio n. We believe it

of th is opport unity. For mor e infor-

w ill be a nati onal mode l of tra nsit-oriented development. Read more at spur.org/blog

mati on, please see bit.l y/Lyl1r4.

ThePark Shadow Task Force Completes Its Work

inform ati on th ey need. The pot en-

process. SPUR is closely follow-

tial impact of new shadows cast

ing th e different alte rnativ es to be stud ied in t his EIR. We believe t he

Community Safety ElementPasses Planning Commission

As t he Transit Center Distr ict Plan

by high-rises in th e Transbay area

(com monly know n as "Transbay")

has been studied th oroughly, and

EIR process is an imp orta nt place

San Francisco' s Community Safety

developed over th e last few years,

our own view is that th e impacts

to explore po licies like ope n lane

Element was unanimou sly adopte d

opp onents began to argue that

would be mi nor. And while we were thr illed to see th e Board of Su-

tollin g, a form of road pr icing that

by th e Planning Commi ssion thi s

th e shadows th e new building s

simu lta neously aff ect s tr avel be-

month and wi ll make its way to

would cast on park s wou ld be so

pervisors adopt the Transit Center

havior and generates revenue for

egregious th at the taller build -

Distr ict Plan in May, we were not

tran sport ati on. We want to express

the Board of Supervisors fo r fin al adopt ion later thi s summer. The

ings should not be perm itted. In

surprised to see opponents appeal

response to th ese concerns, Super-

th e adequ acy of th e environmenta l

our concern abo ut an alternat ive th at cuts long-term tr ansit capi ta l

out policies and objectives that

visor David Chiu and t hen-Mayor

impac t review. To download th e

Gavin Newsom appo inted a task

plan, go to bit.ly/ LhLDkq.

invest ments or redu ces One Bay Area grant investmen ts in Prior it y

th e develop ment of programs that

force to stu dy the matter in the spring of 2010. SPUR executive directo r Gabriel Metcalf and board member Brad Paul co-chaired th e

Testing Alternative Futures for the BayArea

Communi t y Safety Element lays facilit at e communit y resilience and

Develop ment Areas (PDAs) as th e

will help us prepa re for and recover

revenue source to restore or ex-

from a major eart hquake. Fans of

pand tran sit service.

SPUR's Resilie nt Cit y initi ative will

task force, and th e gro up issued

Now th at th ere is a " Preferred Scenario" for Plan Bay Area, th e

it s report in May of th is year. Given

joint Sustainable Communities

CentralCorridorProject Concepts Released

th e diversit y of op inion on the task

St rategy/Re gional Transportation

The planning depart ment has

nity Safet y Element, most notably

force, th e recomm endat ions are

plan, the next phase of t his multi -

released its draft plan concepts

our co ncept of resilience as being

generally weak. The group did,

year pro cess is th e development of

for th e Central Corridor Proj ect ,

related to the way a city is able to

however, agree abo ut the need for

wh ich seeks to coo rd inate tr ans-

recover from a major eart hq uake.

full and informed presentati ons of

alterna t ives for th e Environm ental Impact Repor t ( EIR). This techni-

portati on and land use in th e area

We hope the supervi sors wi ll sup-

be pleased to not e th at some of th e ideas from our repo rt s have made th eir way into t he Com mu-

t he cumulat ive potential impacts

cal process is quite imp ortant and

between Third and Fifth streets

po rt t he passage of t his imp ort ant

of new buildings in and near th e

offers a chance to mor e closely

from Town send to Market and to

upd ate to San Francisco's General

Transbay plan area as a way to give

test different growth scenarios

build off investm ent s being made

Plan. For mo re informat ion, see bit.

decision makers and resident s th e

than in pr ior steps of th is planning

in th e new Centra l Subway, which

ly/LaGCvU . •

T HE URBANI ST

JULY 2012

3

PAYING FOR HIGH -SPEED RAIL

Getting High-Speed Rail On Track

Summary: Much of the deba te around high -speed rail revolv es around federal fund ing. But with or witho ut - th at revenue st ream,

For California, high speed rail isn't just a worthwhile investment, it's a necessary one. Here's how we can pay for it.

By Eg a n Terp lan and Heng Gao

Overview As California prepares to build North Am erica's first 20 0 -p lus-miles-per-hour high- speed rail t rack, t he voices of do ubt and hesitation becom e louder and mor e st rident. Skept ics at tempt to drown out confidence in th e pr oject. But if th e current uneven economic recovery can offe r any lesson at all, it's t hat conf idence is a vital factor in correcting an economy - and it is also the most important asset of a public works project.

Skepti cs have fram ed t he question of high -speed rail as a major debate about whether or not we can aff ord it. This debate is happ ening both in Washington , O.c. and th rou ghout California.

SPUR believes that high-speed rail is not just a worthwhil e investment but a necessary one. We also believe that we can afford it.

California began building its current state freeway system in 1947, a decade befo re the federal government intr oduced (and began funding) t he Interstate Highway System. Much of t he debate and planni ng around buildi ng Californ ia's high-speed rail assumes that th e major ity of th e capital construct ion fund s will come from the federal government - at least $38 bil lion in grants, loans and othe r financial support. That assumption is understandable: For t he past century, major transportation projects - from bridg es to rail - have always been funded with federal dollars . Federal governm ent - supported bond s enabled t he San Francisco-Oak land Bay Bridge to be built,

4

JULY 2012

for example. And worldw ide, major high-speed rail systems are generally built with funding from nat ional government s.

However, given our national political dy namics, where a significant major ity of elected leaders do not suppor t government investment in dom estic infrastructur e, let alone in non-auto modes of travel, it is quite possible t hat significant federal investment will not materialize. This is not to be taken lightl y: A fut ure for the United States witho ut major federal support for t ransportation projects is frig htenin g and would lead to th e furth er degradati on of infrastructure and the loss of th e nation 's economic comp etitiveness.

Unpleasant as it is to cont emplat e, th is is a very tan gible scenario we must prepare for. The good news is that even with out federal support, Californi a can pay for a high-speed rail system wit h resources generated within the state.

Californ ia is the world' s ninth largest economy and t he largest single economic entity wor ldw ide without a high-speed rail system at least under construct ion.

Far smaller economies and regio ns have built or are building high-speed rail. Californ ia's gro ss state produ ct is $1.959 billion - 188 percent larger than South Korea's gross domest ic product (GOP), 143 percent larger than the Net herlands' and 30 percent larger than Russia's. In China, the high-speed rail connect ing Beijing and Shanghai was built in less t han t hree years. The total GOP of Beijing and Shanghai is about $550 billion, which is only half that of the

SPUR believes th at Calif ornia can fund much of high speed rail on its own.

FIGURE 1

Construction phases for high-speed rail Just like the building of the Interstate Highway System, the construction of high-speed rail wil l occur in phases .

The full system that connects north to Sacramento and south to San Diego has been proposed, but thecosts for these investmentsarenot yetdetailed.

Heng Gao isa graduate student at the Department of City andRegional Planning at theUniversity of Pennsylvania

T HE URBA NI ST

Caltrain Corridor Unified Service

••• • • • • • • • • • • Initial Operating Segment (105), First Construction Initial Operating Segment (105), 2013-2021 Bay to Basin, 2021-2026 Blended, 2014-2028 •••••••••••• I

Phase 2 (proposed, but costs not yet identi fied) Existing Passenger Rail Systems

San Diego

I

PAYING FOR HIGH-SPEED RA IL

combined San Francisco Bay Area and Los Ange les

How the train will be built

Met rop olitan Statis t ical Area.

Califo rnia is pr oject ed to add 20 milli on peopl e

The latest business plan ado pts th e Europea n app roach to deliverin g high-speed rail: dedicated

betwee n 2010 and 205 0 . The curr ent prop osed $68.4

fast tr ack in rural areas and use of exist ing, but ofte n

billio n high -speed rail system is far less costly and

upgraded, railways in urba n areas. This app roach

has significant ly fewe r environmenta l imp act s than

allows fo r a faster system delivery, w hich saves money and not only delivers benefit s sooner but

th e more th an $170 billion th at wo uld othe rw ise have to be spent by t he state to expand airpo rt runways and highways.

This art icle demonst rates how and why California

also generates revenue faster. Each sect ion of t he rail network w ill prov ide indepe ndent utility pri or to th e complet ion of a comprehensive sta tew ide system of

can - and must - proceed w it h bui ldin g high-

dedicated high-speed t racks. This so-ca lled "blended"

speed rail.

app roach wo uld run high-speed tr ains on exist ing rail

What is the status of California's highspeed rail system?

In th e 1970 s, leaders in Califo rnia prop osed a high -

as well as on new, dedi cated tr acks. This increment al met hod was successfully employed by th e TGV, France's high-speed rail system. (This sort of phased

speed rail connect io n between North ern and Sout hern

const ructio n of infr astru ctur e is not uncomm on: Int erstate 5 in Califo rnia was begun in 194 7 and not

Califo rnia. Alt hough Amt rak has long provided tr ain

complete d until 1979.

service along th e Pacifi c Coast and sout h through th e

Since most current regional rail serv ice in th e state

Cent ral Valley to Bakersfield, th ere is no passenger

is diesel, th e blended app roach involves convert ing

rail serv ice over th e Tehachapi Mountains int o th e Los Ange les Basin. High -speed rail service wo uld reduce

di esel tr ain serv ice (includin g Calt rain in th e Bay A rea)

t he current San Francisco- to-L os Ange les tr ansit

to elect ric serv ice wh ere tr ains will share tr acks. This appro ach reduces costs significant ly but st ill achieves

trip from nearly nine hour s ( including a long bus trip

a single-seat rid e (t hat is, one tr ain goes th e ent ire

over th e mount ains) to less than three hours, a speed th at is highl y competit ive w it h air and much

distance from A to B, no tr ansfers requir ed) fr om

faster th an auto travel.

In Novemb er 2008, 53 percent of Califo rnia vote rs app roved a $9.95 bi llion General Obligat ion bond

dow ntow n San Francisco to downt own Los Ange les and beyond .

There are three major phases prop osed for th e const ruct ion and impl ementati on of high-speed rail:

(Prop ositi on 1A) as a down payment on building such a system f rom San Francisco to Los Ange les and cont inuing to A naheim. At th e tim e, it was project ed th at th e full statew ide system wou ld cost $33 billion.

In 20 09. th e Obama administra t ion identi fied $10.1

1. Initial Operating Section (Mercedto SanFernando Valley) The fir st phase will includ e building dedicated high-speed rail tr acks fr om Merced in th e Centra l

billi on in fede ral funds for U.S. high -speed rail projects,

Valley sout h th rou gh Fresno and Bakersfield and th en

$3.6 billi on of w hich is dedicated for California. In 2011, th e California High -Speed Rail Aut hority decid ed to

east to Palmd ale and south int o t he San Fernando Valley, at th e north ern edge of th e Los Ange les

invest th e first major porti on of its state bond funds to begin co nstruct io n in th e Cent ral Valley port ion

metr opolit an area. Construct ion w ill be comp leted by

of th e segment. The federal gove rnment sup ported

2022, at which t ime th e tr ain could open for service for passengers tr aveling from t he Cent ral Valley int o

th at decision and made t he delivery of it s $3.6 billion

t he Los Angeles region. The current business plan

investm ent cont ingent on const ruct ion comme ncing in th e Cent ral Valley in 2012.

forecasts ope rat ing pro fits on thi s line, w hich means

In recent years, th e Califo rnia High-Speed Rail Auth ority has furt her refin ed its extensive engineering

we can const ruct a high -speed tr ain line from Merced to the Los Ange les area th at requires no ongo ing operati ng subsidies.

drawin gs and produced several updat ed business plans closely detailing how and w here th e rail system w ill be built, and at what cost. This is a project t hat has been studie d and scrut inized at an ext remely high level of deta il.

2. Bayto Basin System (San Francisco to San Fernando Valley) In t he second phase, to begin in 2021and be comp lete d in 2026 , th e dedicate d high-speed rail

As of thi s w rit ing, th e State legislatur e has not

infr astr uctur e w ill be extended int o San Jose from

yet aut horized th e sale of t he state bonds to beg in

Merced. This segment w ill enable a one-seat rid e

construct ion in the Centra l Valley.

fr om the Transbay Transit Center in dow ntown San

6

JULY 20 12

THE URBAN IST

generat e approxi mately 100,0 00 jobs for peopl e in

Initial Operating Segment

lOS 2013-2021 Bayto Basin 2021-2026 Phase 1Blended 2014-2028 2012 JAN

EarlyInvestmentBlended Systems/Bookends 2014

2016

2018

1

Northern Ca lifornia Unified Service

FIGURE 2

Construction schedule for high-speed rail The Initial Operating Segment (105) would connecttheCe ntral Valley withthe Los Ange lesarea and begin servicearound 2022.

WithBay to Basin service thetrainwould then conn ectto theBayArea andallow for a one-seatride(mean ingno transfers required) fromSan Francisco to theSan FernandoValley by around 2026. Under Phase I Blended, dedicatedhigh-speed train service would connect into Los Angeles' Union Station and beyond to Ana heim.

Throughout theentireconstruction,there would beinvestmentsin the"bookends," meaning investmentsin Ca ltrain and Metrolinkaswellas otherregional rail systemsin theBay Areaand Greater Los Angeles.

202 0

2022

lOS HSR Operati onal

2024

1 ""

to aastn Operational

2026

2028

203 0

,--J a': : :~ 1 I Operational

Francisco all the way to t he San Fernando Valley in t he Los Ange les area.

3. Complete d Phase 1 Blende d Syste m (San Francisco to Anahe im ) The third phase br ings the dedicated high -speed rail system int o Los Angele s' Union Station and beyond to Anaheim. It also involves upgrading the passenger rail corridor between Los Ange les and Anaheim. A comp lete California high-speed rail system would exten d service north fro m Merced to Sacramento and east fro m Los Angeles to Riverside and th en sout h to San Diego. W hile th is arti cle does not assess the costs of t hese extensions, SPUR is commit ted to completi ng a statew ide system that includes Sacramento and San Diego.

Figure 2 (above), shows t he construct ion process for t he t rain system.

The benefits of high-speed rail There are many reasons to pursue a high -speed rail system:

1. High -speed rail makes any two pl aces on or near th e lin e th at were once far apar t appear to be closer together by makin g t ravel betwee n t hem easier and faster. Building a high -speed rail system across California would have a tran sformative potential on the economies of North ern and Southern Californi a as well as the Central Valley. By decreasing the effective distance betwee n parts of the state, highspeed rail shift s the market compe tit ive st ructure w it hin wh ich peop le and firm s make decisions about w here to live, work and invest. In parti cular, high- speed rail can deliver economic grow t h oppo rt unit ies to underperf ormin g places (such as th e Cent ral Valley) . Not only w ill t he construct ion stage

T HE URBANI ST

th e Central Valley, but, once the train is op erating, businesses may locate near rail stat ions to access oth er business opportun it ies thro ughout the state.

Considering that the unemployment rates in most Cent ral Valley count ies are between 15 and 20 percent, getting peop le back to work and creating economic infra struct ure to support a grow ing popu lat ion is imperati ve.

2. Hig h-speed tra ins w ill improve mobilit y by saving tra vel t ime and red ucing congestion as travelers shift fr om air and aut o to rail. Califo rnia is falling behind its major competitor s in the wo rld economy du e in part to its cont inued reliance on inef ficient and expensive autom ob ile and air travel. Congestio n on our state's roads result s in $18.7 billion annually in lost tim e and wasted fue l. Flig hts betw een the Los Angeles and San Francisco metr opolitan areas are t he most delayed in the count ry, with app roximately on e out of every four flights late by an hour or more. The alt ernative to providing the same capacity as high- speed rail is to add 2,300 highway lane miles, four new airport runways and 115 airport gates. The costs of t hese expansions wou ld exceed $170 billion over the next 20 years, more t han twic e t he cost of the high -speed rail system. The projected numbe r of rider s diverted from t he air system to t he high-speed rail system wou ld be mo re than 5 million in 2040 and wou ld rise above 6 million by 20 60 . Based on t he experience of Japan and Europe, high-speed trains can secure up to 90 percent of total air traff ic for t ravel up to abo ut 310 miles (slightly less than San Jose to Los Angeles) or half of all air travel fo r distances up to 500 miles (t he distance from San Francisco to San Diego). Overall, from 2040 to 2080, Californ ians will save an average of 79 mill ion hour s per year by using high -speed rail.

3. Hig h-speed rail will reduce pollution and help meet statewide climate change goa ls. With Californ ia's growing popul ation and consequent travel demand, t here is no way to meet our greenhousegas reduct ion goals oth er t han by shifting more trips ont o cleaner tra ins. The rail system w ill mean 3 million fewer tons of carb on dioxide emissions annually. It will also result in 4 billion fewer vehicle m iles traveled on Californ ia highways in 20 40.

4. High -speed rail provides armature for t he state's growth. Californ ia cont inues to grow by nearly 500,000 peopl e per year and is projected to surpass 50 million in popu latio n before t he m iddle of t he cent ury. Most of thi s new grow t h must go into existi ng

JU LY 2 012

7

PAYIN G FOR HIGH -SPEED RAIL

urbanized areas and w ill occur in comm unit ies adjacent to the high-speed rail system.

5. High-speed rail would help strengthen and improve commuter rail and region al intercity rail,

Cost category

Cost (millions)

Percentage

Tracks

$23.60

44 .1%

Rights of way

$11.94

22.3%

Program impl ementati on

$7.04

13.2%

Systems and elect rification $4.45

8.3%

FIGURE 3

Construction cost by category (in constant 2011 dollars)

increasing the viability of transit for intraregion al commut ing. The proposed alignment connects cit ies

current ly on or near the Los Angeles rail system w it h cit ies along Calt rain, for example. Whi le th ere will only be one or two stat ions bet ween San Francisco and San Jose, the sharing of track s along the Peninsula corridor betwe en statew ide (high-speed rail) and regiona l (Calt rain) serv ice w ill provid e signif icant benefits to the Caltrain system by delivering statew ide trav elers who can easily tran sfer to go several

purchaseof theright of wayaccounts for

Stat ions

$3.21

6.0%

2/3 of theentirecostof thehigh-speed

Vehicles

$3.21

6.0%

themselves area relativelysmall portion

Total

$53.44

100.0%

Geographic segment

Cost (billions)

Percentage of overall project

San Francisco to San Jose

$5.6

10.5%

San Jose to Merced

$13.5

25.3%

Merced to Bakersfield

$1 0.1

18.9%

Bakersfield to Palmda le

$7.6

14.2%

Palmdale to Los Angeles

$12.3

23.0%

Los Ang eles to Anaheim

$0 .5

0.9%

Systemw ide costs

$3.84

7.2%

rail system. Thevehicl esandstations

additional stat ions north or sout h.

6. High-speed rail reinforces the knowledge economy sector by supporting face-to -face interaction and improved productivity. For th e

increasingly integrated economies of Silicon Valley and Hollywood , high- speed rail will facilit ate greater innovat ion, exchange and collabora ti on, part icularly because meetings can be cont inuous from one region to the ot her, w ith out th e hassle and inconvenience of air travel. The addit ional value of rail simply from t he ability to do cont inuous work is estimated at $10 billion . (See " Hollywood vs. Silicon Valley," p. 14) These are just some of the benefits of high -speed rail. But simply building a system do es not guarantee that all the pot ent ial gains wi ll be realized. Maximi zing both ridership and gains to emp loyment and income depend s upon th e ability of th e market to invest in commercia l develop ment, housing and ot her produc tiv e facilit ies near the rail system. As not ed above, such investm ent s can have major impacts on bot h large econo mic agg lom erations such as Silicon Valley as well as more isolated and economically st rapped places like Fresno and oth er Central Valley communities.

But to realize th e full economic benefit s of high -speed rail requires an appro pr iate land use response. This means goo d planning for statio n area development as well as accessibility planning to connect t ravelers from high-speed rail stations to nearby employment and ot her destinations. If such investment do es not occur, or if local opp osit ion crit ically imp edes it, th e imp act of high -speed rail will be signifi cantly reduced.

To achieve the appropriate land use response to high-speed rail requires first t he arti culat ion of a statewid e inter est in high-speed rail as an important too l to shape development. But gi ven that planning is a local funct ion in California, there is a need to

8

JULY 20 12

Theconstructionof thetracks and

of the costs, asistheoverall project managem ent

FIGURE 4

Construction cost by geographic segment (in constant 2011 dollars) Connectingthehighdesert town of Palmdale into los Angelesandfrom Merced intheCentral Valley overthe Pacheco Pass intoSanJose account for over half thecostof therail system.

The long stretch fromMerced to

Total

$53 .4 4

100.0%

Bakersfield in theCentral Valleyaccounts for lessthan1/5 of thetotal cost.

reconcile th is conf lict, part icularly for an infrastructure investment with much broader econom ic benefit s.

SPUR's 2011 Beyond the Tracks report prop osed such a framework that combines local planning wit h stat ewide planning guidelines and oversight.

Yet th is stat ion area planning is only relevant if high -speed rail is actu ally built. Given th is realit y, th e more imm ediate quest ion is how to pay for the system.

How much will it costto build California's high-speed rail system?

The capital cost for a high -speed rail system from San Francisco throu gh the Cent ral Valley to Anaheim is estimated at $68.4 billion in year-of -expenditure do llars, using th e baseline 2011 dollars and varyin g assumpt ions about inflati on. Two-t hird s of th e const ruct ion cost is for building the tra cks and acquiring the right s of way. Constructing stat ions, purchasing t rain cars and building the electrificatio n systems comprise another 20 percent of costs, w ith

TH E URBANI ST

th e remainder being t he administrat ive costs of program imp lement ation. Each category inclu des cont ingencies of between 15and 25 percent fo r unant icipated costs. In add it ion, the project includes a six-year schedu le extension, w hich accounts for unforeseen delays in project fund ing. Speeding up construction or oth er chang es could result in signif icant ly lower costs.

Figure 3 (at top left), breaks out the categories included in the cost estimat e.

Each segment has diff erent costs, wi t h t he most expensive being San Jose to Merced, at $13.5 billion.

Palmd ale to Los Angeles will cost $12.3 billion, w hile Merced to Bakersfield w ill be $10.1 billion and San Francisco to San Jose's Diridon Sta t ion will cost $5.6 billion, including t he tu nnel into S.F.'s Transbay Transit Center. The costs for different segments w ill vary with lengt h and with featur es of the terrain and degree of urbani zatio n. In urban areas, more expensive aerial st ruct ures or tun nels may be required.

Figur e 4 (at bottom left), summa rizes t he capital cost for Phase 1 by segment, in base-year 2011do llars.

These are th e individual alignment costs only and do not include systemwi de costs like vehicle purchases and heavy mainte nance faciliti es (nor doe s it include fut ure rail extensions).

In 2008, whe n Californ ia voter s approved a $9.95 billion bond to support high- speed rail, th e ent ire proje ct cost was $33 billion. In the 2009 business plan, the cost increased to $43 billion, and then increased again in the draft 2012 business plan to $98 .5 billion . The fi nal 2012 business plan reduces the cost to $68.4 billion. It focuses on beg inning const ruct ion in the Cent ral Valley w hile simultaneously making investments in th e "booke nds" - t he urb an areas in th e Los Ange les Basin and t he Bay Area to improve regio nal rail service and take a blended system appr oach to the construct ion and op erat ions by putting initial high-speed service on existing (and upgrad ed) commuter rail faciliti es. This appro ach saves both tim e and resources, as it has few er enviro nmenta l impac ts.

How are we going to pay for it?

Fund ing sources include t he federal, state and local gove rnments as well as private sources, part icularly a po tent ial operato r of t he t rain system. Of the se, only the state and secured federal grants are in hand.

Proposition 1A authorized t he state to issue $9.95 billion of general obligation bond s, $8.2 billio n of which is estimated to be available for high-speed rail infrastr uct ure const ruction after environmental, planning and support costs. The prog ram has also received an allocation of $3.6 billion from th e federal government.

TH E URBA NI ST

In addi tio n, th e business plan assumes ju st und er $5 billion from a combinat ion of local, state and pr ivat e sources.

The plan also assumes a $13 billion investmen t from a private operator who w ill invest once t he trains begin operation around 20 22. If the assumpt ions in th e business plan are correct, the private operator will not requ ire any additi onal operating subsidy and could provide mo re than $230 million from net cash flow for furt her investm ent in finishing the const ruct ion of t he system. The remaining $38 billion is assumed to come from t he federal government in the form of grants, loans and ot her fin ancing suppo rt.

We hope the federal government does indeed invest in Californ ia's high-speed rail system at t his level, but we also believe that Californ ia can pay for th is on our own in the event the federa l invest ment is lower.

California is wealthy enough and economically large enough to pay for high-speed rail. There are many different ways to pay for the system in theory. The of ficial business plan presents one way, and t his paper presents ot her alternat ives in order to make our po int.

In short: We need to do t his, and we can affo rd to do this.

If th e federal government to tally backs away from furth er invest ment in high -speed rail, there is one silver lining: We in California can still build hig h-speed rail by relying on a comb ination of road toll s, vehicle license fees, gas ta xes, regional gen eral obligation bond s, value capture mechanisms and revenues from th e state's cap-and -trade auct ions. These local sources yield more th an $2.7 bil lion annually. Over t he 20year construct ion of the high-speed rail system, t hese sources could replace t he ent irety of t he expec ted $38.3 billion federal investm ent. In addition, th ey could also rep lace the current unspecifi ed $5 billion from additional local, state and pr ivate sources.

Wh ile we are noting that most of the revenue from these identified sources can flow to the high -speed rail proje ct, thi s is not an argument that the se revenue sources should only appl y to high-speed rail. For example, we think gas ta xes should be muc h higher or replaced enti rely with a vehic le-mi les-t raveled fee, but are only assuming an increase of 6 cents per gallon to help support the rail project. In add itio n, th e vehicle license fee (V LF) should return to its historic levels of 2 percent of value. This article, however, assumes far lower and more conservat ive levels. Some may disagree w ith the specific fees we assume or t he share dedicated toward high-speed rail. For each st ream of revenue, reasonable minds can disagree. This art icle is meant to be a t houg ht piece to demonst rate th at wi th t he prope r mix of revenues, California can pay for high-speed rail.

JULY 2012

9

PAYING FOR HIGH -SPEED RA IL

Fundingsources

2012 business plan SPUR plan

State Prop 1A bond (already app roved)

$8.2 bi llion

$8.2 billion

Federal grants (already allocat ed)

$3.6 billion

$3.6 billion

Net cash flow from op erati ons

$238 million

$238 mi llion

in turn increase land values).

While planners often to ut value captu re as a way

Oth er fund s (state, local, pr ivate)

$4.93 billion

$0

to generate additional funds for publi c benefit s, th e

Privat e (equit y partner)

$13.12 billi on

$13.12 billion

mod est source of funding relati ve to the ot her sources described here. In addit ion to th e iimited tools fo r value capt ure, th e recent history of rail investm ent in

receives some of the ret urn on its investment as opp osed to havin g all the increased land value accrue to pri vate prop ert y ow ners. It also enables tho se funds to be reinvested back into the area to help pay for infrastr uct ure improvement s and other benef its (w hich

realit y is that value capt ure in California is a far more

Federal grants and federally backed bo nds

$38.29 billion

$0

Value capt ure

N/ A

$406 million

Gas tax

N/ A

$15.84 billion

Road tolls

N/A

$9.19 bil lio n

hig h-speed rail, including w hat is proposed fo r San

Vehicle license fee

N/ A

$3.75 bil lio n

Francisco's Transbay Transit Center. But we recognize that it has far less pot ent ial as a major fun ding source

Regi onal GO bond

N/ A

$1 billi on

tr ade auct ion revenues.

Value capture encompasses a range of too ls that

Cap-and-t rade

N/ A

$13.05 billion

ext ract some of th e value created by th e investm ent

Tota l

$68 .39 billion

$68 .62 billion

Califo rnia and elsew here in the United States shows only minor increases in value for land adjacent to t ransit. SPUR believes it is crit ically important to further explore value capt ure mechanisms arou nd

than other too ls like tolling, gas taxes and cap-and-

in th e high-speed rail system. Some of th e main tool s include: ~

FIGURE S

How to pay for California's high-speed rail system (in year of expenditure dollars) Californiaca nafford high-speed rail without futurefederal support. Thesources of funding for high-speed rail identifiedhere cangenerateover $43 billiontowardsthe state's$68billionhigh-speedrailproject.

Themost significant sourcesof revenueare adedicatedsix ce nt pergallon gastax, a15 percent shareof thestate'scap and trade auctionsand thecreationof $4 tollsona fewof California'shighways.

Specia l assessment districts assessa fee on parcels in a part icular zone that receives dir ect benefit from

Our assumptions are as follows: ~ An increase in th e gas tax of 6 cents per gallon for

the invest ment in t he high-speed t rain. ~

~

Road tolls of $4 per vehicle on six highways t hat

Tax increment financing ( TlF) is a mechanism wh ereby t he grow t h in prope rty ta xes above a

parallel high-speed rail as it enters the Bay Area and

baseline is di verted and used to pay for specific

~

Sout hern Califo rnia An $8.50 increase in th e annual vehicle license fee

redevelopm ent agencies in Calif orni a w it h th e

(V LF) for 20 years

power to use TIF wit hin redevelopm ent areas, th e

~

A regi onal general obligat ion bond for green power

closest tool is an Infrastru cture Finance District (IFD). This operates like a TIF except that a smaller

20 years

local upg rades. Given that th ere are no longer

for Caltra in and BART th at also includes $1billio n for elect rificat ion and grade separat ion ~

po rtio n of t he tax increment can be used to

$13 billion from t he annual sta te cap-and -t rade

fund local inf rastru cture. IFDs capture the nonschoo l growt h in t he prope rty tax only and are an

auction revenues unt il 202 0 ~

appropriate tool for value capt ure around high-

Various value capture tools ( impact fee, tax increment, Mello Roos distr ict) at five hig h-speed rail stat ions

speed rail statio ns. ~

Develop er impa ct fees are one-t ime charges to develop ers in distr icts or cit ies, t ypi cally to pay

Figur e 5 compa res th e fundin g sources in th e latest

fo r a po rt ion of th e surrounding infr astr uctur e or other public benefits. These impact fees are used

business plan w ith th ose in th e SPUR plan ( in year-o fexpenditure do llars). Below we explain each fundi ng

to fi nance costs associated wit h new development

source in greater deta il.

(such as feeder transit, schoo ls, sewers). ~

Joint developm ent means th at th e private sector

Value capture

joi nt ly develops propert y th at is ow ned by

Value capt ure refers to policy tools that "capture"

t he pub lic secto r (typically t he transit agency) .

for th e public some of th e increases in land value generated by a public investment such as a new tr ansit project. The idea is to ensure th at th e pub lic

10

JU LY 2012

In th e case of high-speed rail, th ere are many needs th at could be paid for wit h value th at is

TH E URBAN IST

recaptured by the pub lic, includin g upgrades to local infrastru ctur e, investm ent s in bringing transit direct ly to th e high-speed rail stat ion, operat ing costs for maintaining t ransit or shuttle prog rams, gap financing for part icular new development projects, econom ic development strateg ies focused on expanding and attracting businesses or for the actual station itself.

For the purposes of this paper, we only looked at value captu re mechanisms focused on projected new development around five stat ions: San Francisco, Millbr ae, San Jose, Los Angeles and Anaheim. Based on the combinat ion of a $5- per-square-foo t development impact fee, the capt uring of 25 percent of th e property increment and a prop ert y tax increase of between 6 and 10 percent (through establishing a Mello-Roos special proper ty tax distr ict), these tools wou ld yield $400 millio n toward the high-speed rail system.

We recognize that San Francisco is already proposing its own system of value capture for t he area around t he Transbay Transit Center. The purpose of th e analysis here is to demonstrate that it will be di fficult for value captu re to yield much in t he way of fundin g for th e overall system.

To generate more from value capt ure, we wo uld have to apply value capture tools to existing developm ent, as we ll as cover a larger geography around station areas. Even w ith such an approach , value capture would yield a small share of the total cost of high-speed rail. The lesson here is that value capture is not a significant source of funding for major statewide infrastruct ure. Instead we have to look to addit ional sources.

Cap-and-tra de Cap-and- trade is an enforceable program put forward by t he Califo rnia Air Resources Board (ARB) to reduce greenhouse gas (GHG) emissions. It is a central

element of California's Global Warming Solutions Act (AB 32). Under cap-and-trade, major sources of GHG emissions in California will be imposed with a GHG cap. The California Air Resources Board wi ll distribute allowances, wh ich are tradab le per mits of GHG emissions, to these capped sectors and w ill hold allowa nce auct ions each year to allow market part icipant s to acquire them. The first cap-a nd- t rade auct ion w ill be held on August 15, 2012, and fu rth er auct ions will be held th roug h 2020.

The funds gene rated from t he auct ioned allowa nces can be used to furt her the purpose of AB 32, including for development and construction of the high-speed rail system. Additionally, high-speed rail is included w ithi n the scoping plan for AB 32.

The 2012-13 governor's budget estima tes that th e cap-a nd-trade auctio ns wi ll generate $1 billi on in

TH E URBAN IST

2012-2013, t he first year of th e auctio n. According to recent est imates by th e Legislati ve Analyst's Off ice, the cap-and- t rade program w ill generate annual revenue ranging from $2 billio n to $14 billion (20 12 dollars) between 2013 and 2020, depend ing on the amou nt of allowance issued and the price . Under Governor Brown's plan, these revenues would be invested in clean and efficient energy, low -carbon t ransport at ion, nat ural resources pro tect ion and sustainab le infrast ruct ure developmen t. The hig hspeed rail project is high ly related to t he low-carbon transport ati on catego ry: By diverti ng peop le from auto mob iles and fli ght s, high- speed rail will reduce 3 milli on tons of GHG emissions annually.

For thi s paper, we use the est imates from th e Legislat ive Analyst's Office for our assumpt ions abou t the revenue generated by t he cap-and-trade auctions .

If we assume that 15 percent of the revenue will be allocated to the high-speed rail project between 2012 and 2020, we projec t t hat th e to tal amount of capand- trade revenues that can be used for high -speed rail is $13.05 billion (2012 do llars).

Tolling A second major po tentia l revenue source is road pric ing. Specifically, we propose establish ing to lls on all lanes on six key highways t hat run paralle l to the high -speed rail alignment - 101, 280, 152,5, 99, and 14. While tolling is likely a necessary mechanism to pay for general hig hway upgrades and to subsidize t ransit opera tions along th e same corridors, we think there is suffic ient potent ial revenue to support some of the initia l capita l costs for high -speed rail construct ion.

This would be based on selling revenue bond s backed by th e annual tolling revenue.

Our approac h is diffe rent from regional high occupa ncy toll (HOT) lane networks, w hich leave some unpr iced lanes and thus can undermine th e efficacy of pricing to affect commute patterns and location choices. By contrast. full lane tolling can vary based on t ime of day and on demand for road usage, encouragi ng commuters to switch to ot her modes of t ransportat ion, tr avel at less congested t imes or change rout es. Tolling freeways at entra nces and exits w ith FasTrak and license plate cameras would be more cost-effec tive.

Road pricing causes motorists to int ernalize t he cost and impacts of dr iving, such as po llution and congestion. Pricing can affect commute choice, time of travel or route of travel. It also has the potential to reduce the number of vehicle trips . The higher cost of driving and use of revenue to fu nd tr ansit can encourage mode shift.

There are some dow nsides and challenges to full

JULY 2012

11

i

Value capture

Theway it isnow If property va luesincreaseasaresult (in part) of publicinvestments, theincreasein value flowsto the property owner.Currently, therearefew mechanismsto capturethis increaseinvalue forpublicbenefits.

SPUR'sproposal At fivedesignatedhigh-speedrail stations, institutevarious mechanisms of va lue ca pturefrom newdevelopment to help financehigh-speed rail (HSR) , includinga$5 per squarefoot impact fee, theca ptureof 25 percent of thegrowthinpropertytaxes, and a10 percent property taxsurcharge.

ill

....... ~

The way it isnow

Californiacharqes 0.65 percent of avehicle's valueasanannual vehiclelicensefee. Until 1998,California charged a VLF of 2percent of avehicle's value.

SPUR'sproposal Increasethe VLF byanaverage of $8.50 per automobileperyear for 20 years.Thiswould increase theratefrom0.65 to0.73. If this small increase were doneincoordinationwith areturn to thehistoric VLF of 2perce nt, the portion of theincreasegoing tohigh-speed rail wouldonlybesix pe rce nt.

-.---,

Gas tax

PAY ING FOR HIG H- SPEED RA IL

Vehicle license fee

,

I , I '

II'

I

Green energy GO bond

Thewayit isnow

Theway it isnow

Californiacharges a36-cents-per-gallongas feeinadditiontoa2.25 percent sales taxon gasoline. Thecombinationofper gallonfee andsalestax isadjustedannually tomaintain aconsistent level of taxation.

Caltrainisadiesel train. BARTiselectric.

BART hassigned an agreement tobuilda natural gaspowerplant that will supply BART withuptoone quarterofitselectrica l supply needs. OnceCaltrainiselectrifiedby 2020, BART and Caltrain's combinedenergyload will be100 megawatts(MW).

SPUR'sproposal Increasethegastax by 6centsper gallonfor 20 yea rs. At $4per gallon,as-cents-pergalloncharge isequivalent toasales taxof 1.5 percent.That6 centswould bededicated to HSR.Thisproposal couldalsobeimposed as a combinationofataxper gallonand asales tax.

U

Tolling

Theway it isnow Moststateand federal highwaysinCalifornia charge notolls. IntheBay Area, thereare sevenstate-owned tollbridgesplus the tolled Golden GateBridge. Therearealso several expresslaneswheresingle-occupant driverscanpay atolltoenter the carpool lane. InOrangeand SanDiego Counties, thereareseveral highwayswith tollsonall lanesranging from$0.50 to$7.75.

SPUR'sproposal Establish tollsof $4 pervehicleonseven currently unpriced highwaysegmentsthat parallelhigh-speed rail as it enterstheBay Area andSouthernCalifornia. Dedicate50 percent of thenettoll revenue tohigh-speed rail for 20 years.

12

JULY 2012

SPUR's proposal Pass aGeneral Obligationbond infiveBay Area counties forelectrifyingCaltrain,establishing100 MWof greenpower (photovoltaic) for Caltrainand BART and providingadditional electrical upgradesonbothsystems and Muni'slightrail and trolley coaches (e lectricbuses).

•

IJII

Cap-and-trade

Theway it isnow California'sAB32 mandatesthat thestate reduce emissionsandenables thecreation of acapand tradeauctionwhereby theAir ResourcesBoardwill auctionoffpollution permits. Starting in2012, thecap affects electricutilities. It expandsin2015toapply to transportationfuels(i.e. refineries).

SPUR's proposal Dedicate15 percentof theproceedsof the auctionrevenuesuntil 2020 tohigh-speed rail (upto$13 billion).

road pr icing. For example, pricin g all lanes of the freeway wi ll raise equity concerns. Drivers w ho cannot affo rd the to ll are pri ced off t he road or forced to choose alternative routes or modes that may be more t ime-consuming. Low-income motorists who have no alternati ve w ill pay the to ll but may not value thei r time savings more th an t he toll.

Alt hough freeway pricing raises numero us issues and concerns, it has great potent ial both to increase revenue and to affec t individual travel choice. As a result, road pricing t hroug h tolls is an ideal candidate for a regional fundi ng mechanism to help pay for high speed rail const ruction .

We argue that tolling should occur in t hree regions of th e state: t he Bay Area, the Cent ral Valley and t he Los Ang eles area. In our scheme, t he Los Angeles and Bay Area tolls w ill pay for a share of the construct ion costs of br ingi ng high-speed rail from th e Centra l Valley over t he mo untains (Coastal Range or Tehachapi) and for upgrades to regional rail netw orks.

In additio n, tolls w it hin the Central Valley will help pay for fini shing th e const ruct ion in the Central Valley.

Actual tolls would range from $2 to $6 and would vary by t ime of day and distance t raveled. The average toll wo uld be $4, wh ich is the amo unt used in our analysis.

Gas tax The state of California taxes automobile gasoline at 36 cents per gallon, two -t hirds of which pays for state highways, wit h t he remaind er going to cit ies and count ies, pr imarily for st reets and roads. In addit ion, California also assesses a uniform sta te and local sales tax percent on each gallon ( reduced in 2010 from 8.25 percent to 2.25 percent as part of a gas tax swap wit h an increase in t he cents- per-gallon tax and a decrease in th e sales tax percent). California's gas tax did not increase from 1960 until the 1990s, whereby it grad ually rose from 9 cents per gallon to 18 cents.

In 2010 the tax increased to 35 cents per gallon at the same t ime that t he sales tax decreased fro m 8.25 percent to 2.25 percent. This latest increase, however, did not bring th e total tax to its 1960 level. For example, in 200 0 dollars, in 1960 Californ ia collected more th an $33,000 per million vehicle miles traveled.

By 1990, that take had declined to $6,500 . The gas tax increases in 1990 brought it up to $9,300, still far below 1960 figu res. Today the tax remains at roughly t he same level, whi ch wo uld sti ll put it well below 1960.

SPUR's plan proposes an additio nal gas tax of 6 cents per gallon, w hich wo uld generate $792 million annually. Assuming t he tax would remain in effect for 20 years, it wou ld generate a total of $15.84 billion for t he project.

T HE URBANI ST

Vehicle license fee

Summary of revenue proposals

California 's vehicle license fee (V LF) is an annual fee on the ow nership of a registered vehicle. The state sets the level of t he fee and dist ributes revenues to cities and counties. From 1948 until t he late 1990 s, t he VLF was two percent of assessed value. Since th en, it has been reduced several t imes and is current ly 0.65 percent of a car's assessed value.

There are currently 32 million registered vehicles

The revenue options listed above - value capt ure, cap-and -trade auctio n revenues, tolli ng, gas ta xes,

in Califo rnia, 22 million of w hich are automo biles. The average vehicle license fee per automobile is $66 .

Increasing the fee by $8.50 wo uld make th e effect ive rate of th e VLF only 0.73 percent but wo uld generate $187 million annually, or $3.75 billion over 20 years.

This amo unt could be divid ed evenly among th e t hree regions - t he Bay Area, t he Cent ral Valley and Sout hern Califo rnia - to pay for individual port ions of t he train infrastr uct ure.

General Obligation bond A final revenue source is a com prehensive regional General Obligat ion (GO) bond . Unlike t he statew ide

and Sacramento.

high-speed rail bond from 2008, a GO bo nd at t he county or regional level would need a two-thirds majority vote by th e pub lic to pass. This could change in a future electio n to 55 percent but as of th is w rit ing remains at a t wo-th irds thr eshold for passage. GO bonds have broad app lication as t hey are backed by the local propert y tax st ream.

For th e purposes of t his analysis, we esti mate a

Getting on the right track

$2.5 billion regional GO bond from t he five counties wi t h BART and Calt rain: Alameda, Cont ra Costa, Santa Clara, San Francisco and San Mateo count ies.

Together, th ese count ies have assessed values of over $800 billion.

This bond wo uld pay for the follow ing: ~ $1 billion for electrifying Calt rain. This is the only port ion of t he GO bond t hat we are assuming as a replacement for th e federal funds in th e current business plan. ~ $500 million for rehabili tat ion of BART's elect rical system ~ $300 mill ion for improvement s to Muni's trolley coach (elect ric bus) and ligh t rail power system ~

$700 million for creat ing 100 megawatts of solar energy, equivalent to th e tot al load for BART and Caltrain

The $1 billion included here wou ld of fset some of th e invest ment in the current business plan for highspeed rail.

TH E URBANI ST

vehicle license fees and a GO bond - wo uld yield more th an $43 billion in purely state and locally generated fund ing.

We accept th at the proj ect currentl y has about $12 billion in state bonds and federal grants t hat can all be di rectl y applied to th e high-speed rail project.

We also accept assumpt ions for a $13 billion investm ent from a private operator.

All told, the combinat ion of SPUR's plan and th e existing sources yields more than $68 billi on, t he cost of the Phase I San Francisco- to-A naheim syste m describ ed in the 2012 business plan. If const ruct ion happens more quickly (based on havi ng th e fund s earlier th an assumed in th e 2012 business plan), t he ent ire Phase I projec t would cost considerably less than $68 billion. These savings could then be applied to expansion of high -speed rail to San Diego

While based on conservative fiscal assumpt ions, the revenues describ ed here are no doubt aggr essive po litical assumptions. The current moo d is that gas taxes are high and road tolls should only be used to pay for existi ng highwa ys. However, part of the econo mic planning approach t hat SPUR suppo rts is to consider t he megaregio n as its own semiautono mous economic unit. For the purposes of Californi a, t his is one of t he reasons to suggest th at we are perhaps one megaregio n, not two.

More imp ort antl y, th e leading econo mic cluste rs of California - Holl ywood and Silico n Valley are increasing ly integrat ed (fo r mor e on t his, see " Hollywood vs. Silicon Valley," p. 14). A physical rail linkage provides a much mor e substant ial link than t he current roadway and airp lane connect ions.

Given t he fut ure economic impo rtance of support ing thi s ongoing integra tio n, we th ink it is wort h pursuing t hese fu nding schemes as a way to fast-t rack th e bu ilding of high-speed rail.

Ultimat ely, th is app roach may mean the differe nce betwe en a part ial high-speed rail system w it h lit t le ut ility and a full-fledged statew ide system that offers a one-seat ride from San Francisco to Los Angeles in less t han th ree hours. It is only on a tra in that t ravelers can watch t heir Hollywoodproduced movie on an iPad designed in t he Silicon Valley wi t hout ever t urning it off for takeoff and landing. •

JULY 20 12

13

AN OTH ER ARGUM ENT FO R HIGH-SPEED RAIL

Hollywood V5.

Silicon Valley

Summary: As new business mod els cont inue to break th e divide bet ween conte nt creatio n and distribution , SPUR considers how rail service bet ween north and sout h might furth er facilit ate creat ive collabo rat ion.

Another perk of high-speed rail? Seamlessly connecting two of California's most important economic clusters.

By Gabrie l Met calf

SPUR considers high-speedrail vit al not just for the ecologic al imperat ive of providin g a viable alternat ive to car and air travel but as a crucial step toward realizing th e economic pot enti al of enhanced access and exchange across th e state. The dynamic int eracti on bet ween two of California's most import ant economic clusters - Silicon Valley and Hollywood is among the most excit ing examp les of the potential of such cross-pollinat ion. The conflict and convergence between these areas form s a backdr op to th e ongoi ng debat e abo ut w het her or not we can affo rd high- speed rail.

Gabriel MetcalfisSPUR's ExecutiveDirector

A clash of clusters (and cultures) On August 10, 2011, Apple surpassed Exxon Mobil to become the most valuabl e company lnthe world, with a market capita lizatio n of nearly $555 billion as of this w riti ng. This achievement stems not just from the success of Apple's approac h to pro duct design but from App le's pioneer ing use of design to bridge th e distinct expert ise of the enterta inment and technolog y indust ries.

Californ ia has th e great fortune of serving as th e home for tw o major innovat ive economic clusters described in th e short hand of Silicon Valley and Hollywo od . "Silicon Valley" denot es th e broad set of technol og y-related indu stri es located in t he Bay Area from San Jose to Santa Rosa, spanning fields

14 JULY 20 12

as diverse as Internet search, semiconducto rs, softwa re, gaming and social media. This economic region has the highest prop orti on of tech job s in th e country - more than fou r tim es the national average, according to Forbes - and is home to 49 percent of California's patent s and 12 percent of the natio n's (a marked increase since 1990 from 25 percent and 4 percent, respect ively) . "Hollywood" refers of course to the Los Ang eles basin's cluster of ent ert ainment -related industr ies in film, television, music and pub lishing and is th e nati on's single largest export secto r and the most globally competi ti ve. With more th an 35 out of every 1,000 workers employed in art s, design, entertainment and media occupat ions, th e Los Angeles metrop olit an area has the highest concentration of ente rtainment wo rkers in th e country .

For most of t heir existence, Silicon Valley and Hollywood have been essentially distin ct from one anot her. Silicon Valley produced technologies t hat were sold to ot her businesses while Hollywood develo ped content t hat was sold to consumers thr ough the ind ustry's propr ietary distr ibuti on channels. But over the past 15 years, since the emergence of t he mod ern Inte rnet, th ere has been a grow ing clash betw een these t wo clusters over t he way people access movi es, books and music w hat some would call "culture" and oth ers wou ld call "cont ent." The result has been a st rugg le

THE URB A NI ST

over revenue, distribution channels and cont rol.

Out of th e clash, we are now w it nessing the emergence of new business mod els that bridge th e divid e betwee n creat ion and dist ribut ion, int egratin g both sides of th e produ ct delivery equat ion and connect ing peopl e to entertain ment and inform ation in new ways. The new system is built upon a deepening int egration of Silicon Valley and Hollywo od.

Explorin g th e dy namics of compet ition and convergence bet ween Hollywood and Silicon Valley present s a case st udy in creat ive destru cti on and economic development, a harbin ger of imp ort ant questions concerning the future of th e expo rt eng ines that make Califo rnia an internati onal economic powerhouse. It also prov ides vital context for understanding t he economic imp ortance behind one of the major planning decisions of our day: th e effo rt to build a high-speed rail system across Califo rnia. The economic cluste rs of North ern and Sout hern Califo rnia would benefit from being functi onally closer because of high -speed tr ain serv ice. As the t wo economic regions furt her integrate, the tra in that w ill connect them calls into question w het her Califo rnia is two megaregions or act ually one.

During its bri ef run from Febru ary of 2000 to July of 20 01 , Napster was visited by more t han 25 million users, who flocked to the website to share and dow nload free music. Prop rietary content, tr adit ionally dissemin ated by a cent ral owner, was being replaced by th e many-to-many exchange st ructure of t he Internet. The impl ications were quickly felt beyond th e music wo rld. The replacement of licensed distribut ion channels wit h open platfo rms and th e switc h from the shippi ng of physical invent ory to t he dist ribut ion of electro ns - for which t he marginal costs of ext ra sales is essent ially nothin g - opened up a wo rld in w hich independent, amateur and user-ge nerated content prolif erated. At the same tim e, the limit ed bandw idt h and programmin g slots of television and radio were challenged by th e inf init e set of content channels made available th rough the Internet.

New cultural forms, from the mashup to th e blog, proliferated. Art ists, w riters, academics and amateurs - anyone with anyth ing to say - had a new platf orm for expressing th emselves (albeit w it h vary ing capabilit ies of reaching an audience).

The result ing explosion - and subsequent devaluati on - of conte nt significant ly undermin ed th e business models of t he content prov iders centered in Hollywood and New York. The ente rtai nment industry had made its money by w ithholding conte nt w it h

TH E URBANI ST

th e pur pose of increasing it s value. The Internet , by cont rast, was an ecosystem of abundance, and Silicon Valley firms benefitted by creat ing prog rams and products th at allowe d consumers to access thi s abundance, ofte n for free. As content increased, so did th e value of Silicon Valley's too ls. Before 2005, " med ia and entertainment" as indu str y catego ries of venture capital investm ent barely registered in th e Bay Area, but in 2006, media and ente rtai nment grew to about 8 percent of all vent ure capital investm ent in Silicon Valley. (In 2011 , they we re abo ut 5 percent, the same as IT serv ices.)

But th e cultural and market changes brought on by free access to so much online content meant that th e music industr y had entered a permanent catand-mouse game of chasing illegal music downl oads.

Newspapers and pr int media soon began to suffe r similar disrupt ions. And w it h th e advent of YouTube in 2005, coupled w ith th e increasing bandwidth of

JU LY 2012

15

ANOTH ER ARGUM ENT FOR HIGH-SPEED RA IL

household Internet connect ions, th e same dynamic wo uld emerge for television content.

The innovation s unleashed by Silicon Valley firm s challenged th e business models of t he entertainment indust ry and other content prov iders in at least four major ways:

1. By lowering th e costs of prod uction through cheap desktop soft ware, Silicon Valley enabled many more people to become produ cers. This has lead to more user-generated content, whet her in the st ruct ured for m of Wikipedia or th e less organ ized amateur off erings on the Internet, which cont inues to challeng e the value propo sitio n of the corporate content creator s.

2. At the same t ime, as distr ibution moved from physical to virtua l channels, many mor e people could become distributors. Compar ed wit h traditional book publi shing, the costs of publi shing a bl og are negligib le. To greater or lesser deg rees, the same is true for every new digit al form of content distribution.

3. Stemming from the se changes, the trad it ional gatekeeper role th at content pub lishing indust ries had played bega n to erode . The music and film indust ries had been able to concent rate vast resources into a select group of art ists, cranking up t he "star maker machinery" to generate hit s. But th e open architecture of th e Internet made it possible for art ists and w riters to fi nd audiences for more niche content. Whereas t he old business models emp hasized selling a relati vely small number of hits to a mass aud ience, new technolog ies made it profitable to sell many more kinds of cultural cont ent to a larger number of small audiences - the so-c alled long- tai l of the bell curve distribution of demand . Obscure books, music, movie s, web sites and blogs on every topic; Myspace pages for musicians; and YouTube channels for video content opened up an endless array of publi shing channels.

Social media. which enables fri ends to recomm end artic les. websites, songs and shows directly to one ot her, is increasingly becom ing the way peopl e decide w hat conte nt to consume. All of t his is radically changing the editori al fu nct ions of th e profe ssional gatekeepers, w ho once served as the primary filters betwee n content prod ucers and pot enti al audiences.

16 JULY 2012

4. The new platf orm s created by tech companies also began to provid e direct compet ition fo r the advert ising revenues th at had t radit ionally supported t he television, radio and newspaper industries. Craigslist eviscerated the classified-ad market, spelling the undoing of dai ly newspapers.

Search-based advertising (beg inning with Goog le's AdWords) became dominant. And social media websites, Facebook chief amo ng them, came to prov ide serious compet it ion for consumers' discreti onary cultural and entertainment consumption time, as well as for adverti sing do llars.

Finally, t he fragm ent ation of audiences int o millions of websites made it more difficu lt to effective ly bundle audie nces together to sell ads.

Diffe rent sectors of content and ente rtai nment prov iders have responded to the se changes in differ ent ways. As enterta inment att orn ey Jonathan Handel put it , "Tradit ional med ia compa nies are slow to adopt new technologies for fear of cannibalizing revenue from exist ing channels and offending powerfu l distribution partn ers." But the dynamics of creativ e destruction have begun sweeping away t hose compan ies th at have not effectively reacted to disruption.

The newspaper industry w ill probably never recover from the combined blows of Craigslist, Gooqle and t he Internet it self. Even in 2010, a relatively good year for most sectors of news media, print newspapers cont inued to decline, losing 6.4 percent in revenue according to a Pew St udy. Publishing cont inues to strugg le against t he Amazo n/A pple/Goog le jugge rnaut. Magazines are increasingly shifti ng budgets and staff from print to online. In the case of music, it should be not ed t hat the erosion of t he music industry's power has not necessarily been bad for musicians. W hile mega acts mig ht make less mo ney, it app ears that many more musicians have been able to find an audience because of the pro liferatio n of ways to connect with pot ential fans. But for the music pub lishing companie s, the urgent probl em became how to get consumers to pay for music rather than down loading it for free. The industry was slow to adapt to th e changing dy namics. and ult imately the solution to the prob lem was found not by t he music industry but by App le, wh ich is now also tack ling film and television distribut ion. App le's iTunes represents the first, and th us far most successful. integrat ion of new technology wi t h content. With t he launch of the iPod in 2001and the iTunes music sto re in 2003, it

THE URBANI ST

finally became easy for consumer s to pay for music - and ult imately TV, mov ies and ot her applicat ions.

Today. fully 70 percent of digita l music sales take place thr ough the iTunes sto re. amoun ti ng to 28 percent of all music sales.

The film and television industri es app ear to be doing better t han the music industry. As media repo rter Brooks Barnes noted in the New York Times. "instead of Holly wood suffe ring it s ow n Napster momenLseveral differences have allowed vid eo content to weath er the storm." Having witn essed the music industry lose cont rol of its inventory, film and TV indu str y giants have fought vert ical disintegration by pion eering new means of distribution. Same-day release and increasing on-demand opt ions have helped stem piracy. Cable services are being expanded to allow viewers to watch shows on any device provided they are subscribers. And video indust ries benefit from th e simple fact that video requir es much more bandwidth than audio, so the cult ure of fil e sharing never overw helmed movies and TV to t he same degree as it did music.

Neverth eless. as household bandw idt h increases and th e costs of product ion decrease, we may see the very same dy namics unfold for movies and TV that have already t ransformed t he music industry. In 2007, Viacom sued YouTube over content piracy, but by 2010 TV industry giant s, includin g Warner Bros., Sony and NBC Universal, were agreeing to license th eir content thr ough YouTube. Many different firms are compet ing to becom e imp ort ant distributi on channels for online video conte nt. And just as cable TV channels like HBO moved up th e value chain from distribut ing content to creati ng th eir own conte nt, online distribu tio n channels like YouTube, Hulu, Yahoo and Netflix are increasingly develop ing th eir ow n origi nal cont ent in partner ship w it h prof essional wr iters, produc ers and entertain ers hired from Hollywood. furth er mergin g th e worlds of Silicon Valley and Holl ywood.

Bridging the "Great Divide" One of the major lessons fro m the career of Steve Jobs, the for mer CEO of App le, is the value to be had from bri nging tog eth er th e cult ures of Silicon Valley and Hollywood: When I went to Pixar, I became aware of a great divide. Tech companies don't understand creati vity.

They don't app reciate intuitive thinking, like the ability for an A&R [ artist and repertoire] guy at a music label to listen to a hundred artists and have a feeling for THE URBAN IST

which fi ve might be successful. They thin k that creative people ju st sit aro und on couches all day and are undisciplin ed, because th ey 've not seen how dri ven and disciplined the creati ve folks at places like Pixar are.

On the oth er hand, music companies are completely clueless about technology. They thin k they can j ust go out and hire a few tech fo lks, but that would be like Apple trying to hire peop le to produce music.

I'm one of the few people who understands how pro ducing technology requires intuition and creativity, and how producing something artistic takes real discipline.'

Ap ple and Pixar were th e first, and perhaps t he most successful, companies to successfully integ rate Silicon Valley and Hollywo od. Tod ay, many ot hers are follo wing in t heir wake.

In thi s new ecosystem, t he core competencies of Hollywood have had to adapt. Zack Zalon, founder of Los Angeles start up incubator Elevato r Labs, is one of th e emerging generati on of L.A. entrepreneurs pioneerin g an evolved role for entertainment w it hin th is converging economic landscape. Others, like form er Myspace chief executi ve Mike Jones, are wo rking to provide t he infrast ruct ure for a uniqu ely Los Ang eles innovati on cultu re to thr ive in "Silicon Beach," as some have taken to calling L.A.'s emergent tech corridor. Jones's Science Inc. provid es access to investment capital and strategic mento rship, which used to be diff icult to find outside Silicon Valley.

Hollywood has th e compet it ive advantage of being full of th e creat ive types whose art istry Jobs correct ly ident ifi ed as essent ial to creat ing successful products.

In the new cultural landscape of infi nit e content, it 's up to th e audie nce. not the executive, to decide w hat's wor th watching. And Los Ang eles, th e beat ing heart of Am erican po pular culture , has always had a unique abil ity to give shape to Amer ican dreams w it h a special poetr y t hat eludes techies and cellphone video uploaders.

There wi ll cont inue to be high-profi le conflict betw een Hollywood and Silicon Valley as the entertainment indu stry tri es to enact legislat ion to keep cont rol over t he means of distribu t ion of content and as new technologies emerge. But t he dom inant dy nami c is one of converge nce, as th e new tools for conten t distributi on, centered in Silicon Valley, find enormo us economic value by being joined wit h the creators, talent, produ cers and di rector s w ho pop ulate t he ente rtainment industr y centered in Los Angeles.

Amo ng its numerous benefits, high-speed rail could furt her facilitate thi s fruitful collabo rat ion. •

JU LY 2012

17

URBAN F IELD NOTES

Case Study #50:

Artifacts of the Waterfront O n San Franc isc o 's ce ntra l and so ut he rn w at erfr on t , ev ide nce o f an era gon e by .

Caseworkers: Jim Jacobs and Katie Daniels

The landscape of the central and sout hern waterfront is rapid ly changing. We have witn essed t he transformation of the ballpark /Chi na Basin wa rehouse area, the marshes of Mission Bay, and on the hori zon, Pier 70 and Hunters Point Shipyard. It' s fascinating to watc h and experie nce t he "edg e" of the city mi grate, including layers of San Francisco's Industrial Era infrastru ctu re being revamped, making way for urban developments of th e Info rmat ion Era. Although t he waterfront between Crane Cove Park and Herons Head Park app ears desolate, there are considerabl e activ itie s on Port- owned land making thi s a very active waterfront for heavy- industrial uses. Sections of thi s working waterfront are littered w it h an amazing collection of arti facts of an era go ne by. There's a certain quali ty of craftsmanship, detail and overall character th at represents a distinct period in t he city' s history and culture. The fat e of t hese it ems - buildings, stacks, cranes, rail lines and cobble - is unknown. Perhaps once remov ed, they may be forgotten w hen fut ure master plans infill the se landscapes. We found many of these items to be art. in their own sense, wh ile also being important artifacts of t he city's once very act ive por t. It wo uld be wonderfu l to see t hese st ructure s or materials be purposely reused or incorporated for t hese futu re master planned spaces. San Francisco has some wonderfu l examples of adapt ive reuse of histor ic st ructures. We're curio us to watc h how th e tr ansformat ion of these large land t racts successfully develops t he next layer of history and builds upon that in sit u. Could we ever see a cobbled alley or plaza, made with original San Francisco blo cks, in th e new Pier 70 neighborhood? Where w ill the "edge " of our city be in another 20 years?

We th ought it wou ld be nice to share some artifacts - of ficially or unofficia lly historic - t hat intrigu e us as objects in forgotte n landscapes.

18 JULY 2012

rJ Layers of history: Deteriorating

III Indust ri al landscape meets

industrial landscape in th e fo reground, new UCSF camp us in th e mid-g round and the Bay Bridge

natu ral landscape at the edge of the city: Indust rial build ing in an overgrown landscape.

in th e backgro und.

TH E URBA NI ST

Architectural details:

IlJ The past reasserts itself: Cobbl e

Deteriorating brick factor y or waterfront storage facility.

sto nes peeking th rough the asphalt.

D

II Energy of the past,present and

B

Social media of the past: A bulleti n board for th e dry dock at

future: The power plant stack.

Pier 70.

B

Remnants of the industrial landscape: A mystical cont rapt ion in th e sky - what is it?

THE URBAN IST

Jim Jacobs and Katie Daniels work at Gensler.

CITY NEWS FROM AROUND THE GLOBE

Urban Drift

:m=:i Journey to the Center of the Internet

A lot of peo ple have writte n about th e vir t ual communit ies and online cities th at mimic our real-l ife neighborh ood s. Andrew Blum 's new book, Tubes: A Journey to th e Center of th e Intern et, flips th e discussion and talks about t he very real locat ions of seemingly intangible and less-di scussed Internet infr astructur e. Says Blum, "I can never escape th e powe r of place. I had a stron g hunch th at th e physical adjacencies and clusters th at driv e everythi ng else also had to app ly to the Internet - and that absolute ly turned out to be t he case: ' One example? The "clo ud" is not this et hereal and we ight less t hing but is act ually a series of buildings in citie s w here t he Internet comes out of t he gro und.

older stop dr iving every year?

Or th at more than 20 percent of Americans 56 and older do not dri ve at all? Or t hat 3.6 million nondri vers older than 65 stay at home on any given day because th ey have no ot her opt ion? These are stats we need to pay attent ion to: The number of senior citizen s is expected to doubl e by 2030 .

Cities and towns need to give serious thoug ht to suppor ting th eir ind ependence and mob ility .

The AARP, in collaboration with Street Films produced t he vid eo, "Active Living for All Ages: Creating Neighbor hood s Around Transit," to help lead th e way. A case st udy of Ar lingto n, Virginia a walkable, mixed-use community wit h access to a variety of pub lic tra nsit opt ions, enterta inment and recreat ion, and basic services such as shopping and medical serv ices - is used to show how tr ansitoriente d developm ent can help not just seniors but all of us.

"A Case Study in a Senior-Friendly City:' by Kaid Benfield. The Atlantic Cities. 6/ 5/12

Is Your Town Senior-Friendly?

It should be. Did you know th at 60 0,0 0 0 peopl e ages 70 and 20

JULY 20 12

"BMW's Bike is the Ultimate Pedaling Machine," by Michael Trei, dvice.com, June 2012

When it launched as a Kickstarter proje ct earlier th is year, th e Low Line (a subterra nean version of New York City's wild ly successful elevated park, the High Line), seemed root ed in t he realm of fantasy. But th e proposed underground park, known as th e Delancey Underground, not only surpassed it s $100,000 fund ing goal in April, it went on to win th e heart s of local community groups. In June, th e Land Use Zoning, Public & Private Housing Committee of Manhattan's Community Board 3 voted to suppo rt Team Low Line, who hopes to build the park in an abando ned tr olley terminal beneath Manhattan's Delancey and Essex st reets. A big demon stration proje ct is planned for September, along with the outl ine of a more form al plan for moving forward.

by Jessica Dailey. Curb ed.com . 6/6/ 12

LEED Points for Lingering?

The Ultimate Pedaling Machine

The of t-maligned electr ic bike just got a major upgrade: BMW int roduced th e i Pedalec. Built from carbo n fiber and aluminum,

restaurant, child care facility, library and so on. But perhaps it's time to add "bar " or "pub " to the list. By offering a place to get away from it all (i.e., small apartme nt, stressfu l job), bars can be key to placemaking - perhaps even mo re so th an th e ubiquitous Starbuc ks.

The goal of a bar pat ron is to enjoy t he prim ary benefit of any decent third space: a place to linger, explains developm ent consult ant Michael Hickey. "I'm st ill looking for someone to generate a 'ling ering index' so that we can measure the impact of just plain old hanging out...t hat's really at th e heart of place-mak ing, and we shouldn't forget it:'

By Michael Hickey, Rooflines: The Shelterforce btoq ,

Low Is the New High

"Delancey Underground Winsthe Support of C83,"

"Interview: Andrew Blum Wantsto Know Your Internet: ' by Diana Lind . Next American City, 6/7/ 12

it include s some nifty high-tech features like rege nerative braking that charges the battery as you slow down and hyd raulic disc brakes. The i Pedalec's elect ric motor is only used to provide a boo st for pedaling, leaving you to do a lot of th e wo rk. Its batt ery is good for abo ut 15 to 25 miles.

Oh, and it folds easily. Designed as a companion to BMW's i3 concept car, t he i Pedalec (like most concept cars) may never get built. But as th e practi calit y and perfo rmance of electr ic bikes improves, BMW's bike may very well be a product wo rth launching.

LEED for Neighborhood Development gives credit toward certificat ion for a development t hat contains, or locates near, certai n categories of diverse uses: supermarket, pharmacy,

5/24/ 12

Point & Describe The Descriptiv e Camera works a lot like a regular camera you just point and shoot. But instead of producing an image, thi s proto ty pe out puts a wr itten descripti on of th e scene. Designed

by Matt hew Richardson, th e Descript ive Camera is part of t he t raveling exhibition Venue (" a portable media rig, interview studio, mult i-format event platform, and forward-operat ing landscape research base") and wi ll be used to help survey sites througho ut Nort h America. Follow the journ ey here: v-e -n-u-e .corn

THE URBANI ST

PRESENTIN G SPO NSO R GOLDEN GATE THEATRE ORPHEUM THEATRE CURRAN THEATRE

CO MMUNITY CO NNEC TO RS

~ CPMC Sutter Health

ARUP

~

~ =';1

EASTD IL SECU RED

. . Pacific Gas and ~~

\1 F I RST RE PU BLIC B AN K

"',

Electric Compan(

Re cology.

:'...

LENNAR' U R B A N

!W fRAIlCISCO . WATERfRONT

I

U I U I II , U '

BRID GE BUILDE RS A cad em y of A rt Universit y' A no ny m ous' AE COM • Av alonBay Communiti es, Inc. • Bo ston Prop erties ' Cox, Cast le & Nicholson LLP • Deg enkolb Engineer s ' Forest Cit y Development · Gro svenor Am eri cas ' Hin es ' MBH Architects ' Mission Bay Developm ent Gro up' MJM Manag em ent Group ' Nibbi Brother s Gen era l Co nt ract ors' The Palace Hotel ' PB • Port o f San Fran cisco ' ROM A Design Group ' San Fran ci sco Giants ' TMG Partn er s ' Tishma n Spe ye r Properties ' U.S. Bank Northern Californ ia ' Wi lson Meany

SUSTA INA BLE SUPPO RTE RS AT&T ' A tk ins' Ava nt Hou sing ' Back st rom McC arl ey Berr y & Co. LLC • Th e Bo ldt Co m pa ny ' A ndy & Sara Barn es ' BRIDGE Hou sin g Co rpo rat io n' CGI • Cha rles Salte r Associates ' City CarShar e • Co mcast • CMG Land scap e A rc hitec t ure' Cres leig h Development · Emi lio B. Cruz' Dani el So lo mo n Design Partn er s' Dav id Baker + Partner s A rc hitects ' DM Development Partn er s, LLC • D.N. & E. Walte r & Co. • Eco no m ic & Planning Syste ms, Inc. • Em erald Fund , Inc . • Envir onment al Bui ldin g St rateg ies ' Ro b Evan s & Terry Mich eau • Fehr & Peer s · Linda Jo Fit z • FME A rc hite ct u re + Design' Davi d A. Friedman & Paui et t e J. Meyer ' Gro up I • A nne Halst ed & We lls W hit ney' HKS A rc hitec ts, Inc. • Jon es Hall · KMD A rc h it ec ts' Lend Lease ' Rich ard Lon er g an ' Mark et-Turk Co m pany/Thac he r Fam ily ' McK enn a Lon g & A ld ridge LLP • Pacific Marketing Assoc iates ' Pillsbury W int hro p Shaw Pittman LL P • Plant Const ruc t io n Co mp any' The Prado Gro up ' Presidi o Bank' Proj ect Manag em ent Adviso rs, Inc. • Publi c Financ ial Man ag em ent · RN Field Co nst ruc t io n Inc. • San Fran cisco Internat ional A irpo rt· SB Architec ts' Seife l Co nsu lt ing , Inc . / Elizab eth Seife l Fund' She pp ard Mu llin Richter & Ham pton LLP • Skid more, Ow ings & Merr ill LLP • Univer sal Par ag on Co r po rat io n' We bco r Bui ld er s ' WS P Flack & Kurt z

MEDIA SPO NSO RS mfsiRii~sTimlls

IN -KIN D SPO NSO RS

@:o mcast.

Rice Paper Scissors

N EW MEMBER S

New Business Members

Burk Delventh al

Daniel Grego ry

Jessica Kuo

Kat hrin Moor e

N

'5 0:

GHD

Mary Griffin

Lily Kurkjia n

Rene Mor eno

Rachel Dinno Taylor

Sallie and Dick Gri ffit h

Cory LaVign e

Tina Morri ll

E

s

SB Archit ect s

James Diwi k

Andrew Griff ith s

Sonia Lehman- Frisch

Jumana Nab ti

Ian Leighton

Karen Nagy

Tim Doh ert y

Kat ie Gronsky

Sierra Maest ra Pro pert ies

Andrea Dumovich

Joe Gulde n

Selene Lenox

Richard Neill

RN Field Construction

Wi lliam Philip

Soph ie Hahn

Sam Liccard o

Kathy Nelsen

Duncanson

Patricia Hale

Theodore Lim

Kevin Nestor

Environment al Building St rategies

Amanda Eaken

Anne Halsted

Al bert Lin

Paul Nixon

Ellen Eason

Paul Hand ly

June Lin

Michael D. Nolan

Hed Ehr lich

Peter G. Hanso n

Bob Linscheid

Matthew O'Grady

Vanessa Eng

Youssef Hashash

Drew Litt man

Ricardo Olea

Savlan O. Hauser

Tyler Lockwood

Pierluigi Oliverio

New Members

Mike Bowerm aster Kevin Bowye r

Starr Adams

Chr isti ne Brad ley

Lida A ljabar

Derek Braun

Christ opher Escarcega

Robin All en

Tracy Broadm an

Marco Esposit o

John Haw kins

Krist ! Loui

Pamela Owen Ada ms

Svet ha Ambati

Marie Brooks

Daniel Fama

Jennifer Heflin

Hon g Ly

Edward Parilion

Lewi s Ames

A riane Burw ell

Rick Fath

Davi d Herm an

Xing lu Ma

Rob ert Pierce

Greg Andreas

Genevieve

Lee Fisher

Krista Hermawan

Sean Maddi son

Jill Pilaroscia

Kevin Flahert y

Heat her Hood

John D. Malamut

Richard Pio Roda

Joel Armstro ng

Jeffrey Chan

Jim Fo ng

Claudi a Hottmann

Barb ara Maloney

Reina Quint ero

Newell Arn erich

Jan K Chernoff

Robe rt Fontanil la

Michael J. Huaco

Brand i Mand ato

Aaro n Redd ick

Jeremy Baird

Clarissa Chiang

Jim Fo rsberg

Daniel Hurtado

Christ opher Manning

Elisa Reut inger

A llison Bart ee

Gabriella Chiarenza

Steve Fow ler

Claud e Imbault

Jessica Manzi

Reb ecca Rhine

Bill Bates

Marina

Byron Beach

Cadw alader

Chr isto do ulides

Rebecca Friedb erg

Eric Jam es

Bet h Mart in

Emily Rice

Anita Friedman

Marie Jobling

Kava Massih

James Richert

Lenka Belkova

Mae J. Chu

Laura Fudge

Milicen t Johnson

Matth ew Materkowski

Gary Riley

Brittany Bend ix

Chris Collins

Maureen Futtn er

J. Hulett Jones

Samuel Maurer

Jessica Robinson

Sandy Bernh ard

Michael Costanzo

Oona Gabersek

Susan Jordan

Keit h McCoy

Ted Rosenbaum

Kristo pher Blais

Jeremy Crand ell

Jeff Galbraith

Annet te Kaminsky

Jennifer McDougall

Ben Rosenf ield

Geoff Bom ba

Stephen Crosley

Richard Gatt i

Sherry Katz

Ott o Melara

James Dou glas Ross

Zach Bon sall

Gregor y Dalt on

Kyle Gebhart

Tricia Kelley

Caryl & Pet er Mezey

Jurgen Roussel

Juan Bor relli

Alison Dat z

Bridge t Gilman

Hannah Kellogg

Court ney Miller

Joyce Roy

Will am J Bosto n

Cameron Deal

Just in Goldberg

Paul Kohler

Kelly C. Miller

Jessica Scadron

Ada m Bowe n

Sachi DeCou

Larry Gould

Davi d Kramer

Maren Moegel

Monica Scot t

22

JU LY 2012

~ B

HMH Engin eers

Adrienne Arieff

0

Sara Dewey

TH E URBA NI ST

Q.

MEMBER PROF ILE

San Jose's CORE Chris Neale Vi ce Pre sid ent o f De ve lo p me nt, COR E Co m pa nies For SPUR member Chris Neale, city build ing is a family affai r. The San

been fig ht ing to get high-rises

Favoriteview?

Jose-based CORE Companie s, found ed by Chris's fath er, David, has

and th e residents to go w ith them .

What I see w henever I'm driving

built more than 1,750 new hom es in th e area since putting down root s

Some have succeeded. Now I th ink

t here in 1978. The elder Neale was looking for a new place to do urban

it wi ll make it t hat mu ch easier for

sout h on the Gold en Gate Bridge .

The views from any of the br idge s

redevelopment , explains Chris. "[And in San Jose] he saw t here was a

the next buildings to go up.

[in the regio n] are my favor ites.

Mostimpressive urban infrastructure?

downtown."

Discovering th e wor k SPUR was doing in San Francisco was an

Assomeone who spends a lot of time thinking about the urban environment,what is your favorite city?

such a great city (almost beats

inspirati on, continues Chris, as "San Jose was almo st a blank slate." We

Tough to choose. I w ill pick Rome.

out Rome) with so much to offer.

talked to Chris about his vision for San Jose and w hat other citi es he looks

I remember arr iving by t rain and

The way th e Tube allows you to

to for inspirat ion .

stepping out int o t he city and

get around th e city and pop up

push to redeve lop the city under th e leadership of Frank Taylor [w ho was execut ive dir ector of th e San Jose Redevelopm ent Age ncy for 20 years befor e reti ring in 1999]. They were trying to get a voic e and vision fo r t he

CORE has been working in San Jose for morethan three decades.

What are someof the particular challenges the city faces?

You have to ask, "What elements does a great city have?" But you can't just check off th e boxes. San

I love Londo n's Tube. London is

seeing so many histori c buildin gs.

in so many great neighb orh ood s

locati ng dow ntown? A big new

I spent days wande ring around t he

helps make it not feel so huge and

high-rise?

city on foot, tak ing it all in. I loved

unm anageable.

all t he squares, the cafes, the food, th e people promenading .

And your favorite building?

In th e end, I t hink I loved t he

AT&T Park. I like t hat it was a new

de nsity and th e combinatio n

building th at honor s baseball's

of old and new, th at you could

history. I lived in San Francisco for many years. Back t hen you

Californiawasjust dealt a big blow with the end of redevelopment. What's your outlook for the future?

walk into a hundreds-of-years-

Jose isn't there yet. We've checked

As a developer, you have to be

off tho se item s on t he list but th e

an optimist by nat ure. And even

old build ing to find a new,

wo uld n't have thoug ht of livin g in

cit y hasn't hit th e critic al mass

post-redevelopment, I have some

South Beach. The park shows what

of tho se it ems. It's unclear what

opti mism. I believe the free market

contemporary store selling the latest and greatest. Great cit y.

will do it: A majo r tech company

MoreNew Members!

can wo rk dow ntown. San Jose has

Michael Smit hw ick

Erica Stephan

new development can do fo r an area. It's transformative.

Michael Teit z, Ph.D.

Monique Webster

Jennifer Wong

Kate Sofis

Larry Stone

Matt Toulme

Don Wed en

Jeffrey S. Wood

Katie Selenski

Mark Sopp

Kathryn St. Pierre

Emily Tsiang

Melissa Weese

Denny Yau

Debbie Shepherd

Bill Souders

Ken Stram

Judy Van Soldt

A bb ie Wert heim

Sue May Yen

Alyssa Sherman

Heat her Sparks

Neal Strick berger

A lberto Villaluna

Megan Wessel

Susan Yogi

Neela Shukla

Maureen Spit z

Caitlin Sweeney

Gertrude Villanu eva

Margi e Wheeler

Mark Young

Mono Simeone

Steph en Spit z

Sarah Syed

Maianna Voge

Dyan Whyte

Mark Zehrung

Carmen Tedesco

Jake Waage

Jenna W itte nberg

Xianhang Zhang

Michael Smith

TH E URBANI ST

Travis Stein

MAY 2012

23

O SPUR 654 Mission Street San Francisco. CA 94105-4015

(415) 781-8726 spur.org

3: Ideas + action for a better city

Nonprofit Org. US Postage PAID Permit #4118 San Francisco. CA

38 West Santa Clara Street San Jose. CA 95113 (408) 200 -2020 x106 spur.org/sanjose

» A Z G)

-I I

m

o

»

VI

m "T1

o ::0 I G)

I I

VI ""C

m m o

Tim e-d at ed mate ria l

::0

»

~~75 0

r

2012 Silver SPUR Awards Luncheon

Wednesday October 24, 2012

Reception 10:30 AM Luncheon 12 - 1:30 PM

Moscone Esplanade Ballroom

spur.org/si lverspur

The Silver SPUR Award is the most promi nent award for lifet ime civic ac hieve ment in San Francisco.

SPONSORSHIPS AVAILABLE NOW!

Please joi n us in acknow ledging the co ntrib utio ns and dreams of four remarkable hon or ees:

Indiv idual tickets: $175 Sponsorships: $500 - $10,000

EDWARD A. CHOW, M.D. MILDRED HOWARD STEPHEN S. PEARCE, D.O., PH.D. JOHN K. STEWART

More information onl ine at spur.org/silverspur Sponsorships avai lab le. Contact SPUR's de ve lopment team at 415-644-4882 or events @spur.org for more information.

The Urbanis t is ed ited by A llison Arieff and desig ned by Shaw n Hazen, haze ncre ati ve.com . It is print ed on Finch Casa O paque pap er: 30 % post-consumer waste, 66 % ren ewable energy, chlorine-free, acid- fre e.