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Charlotte, other cities must find own ways to fund programs like transit, expert says

Bruce Katz
Bruce Katz

Charlotte shouldn’t look to the federal government to fund a bigger transit network, help housing affordability or figure out how to redevelop struggling areas.

Instead, Charlotte and other cities should focus on finding – and paying for – their own solutions to such vexing problems. That was the message of Bruce Katz, Centennial Scholar at the Brookings Institution, who was in Charlotte last month at the National League of Cities conference.

He’s a promoter of “The New Localism,” which is also the title of his upcoming book. In an interview with the Observer, Katz said that federal dysfunction and hostile state governments mean cities are more on their own, no longer able to count on larger governments to generously underwrite projects like new rail lines.

“To a large extent, the way the U.S. grew in the late 19th century, where cities...were responsible for the design, financing and delivery of that infrastructure, we’re going back to that period,” said Katz.

“We’re at a stage of growth in our country and around the world where cities are the vanguard of problem solving,” said Katz. “The federal government, when it functions, is a health insurance company with an army.”

Charlotte faces substantial costs and growing pains as the city matures.

The Charlotte Area Transit Service’s ambitious proposal to build three new rail lines at once – light rail to Matthews; light rail to the airport; and some sort of rail to Lake Norman – would cost as much as $7 billion and would require some type of tax increase. Charlotte is also grappling with rising housing costs and a big shortfall in affordable housing, with City Council likely to raise millions more dollars for the Housing Trust Fund through a bond offering next year.

Katz pointed to examples such as Pittsburgh and Copenhagen as places with models to emulate. In Copenhagen, for example, a publicly owned, private corporation controls and sells public property. The corporation redevelops the land strategically, partnering with and selling it to other firms. Funds from those sales and revenue from developments pays for public infrastructure such as transit, roads, parks and other amenities.

Charlotte and other municipalities – typically Democratic bastions in North Carolina – have also faced challenges from the Republican-dominated legislature. Charlotte City Council and the General Assembly fought for more than a year over control of Charlotte Douglas International Airport, with the city ultimately prevailing. When Charlotte passed a local ordinance that expanded non-discrimination protections to include LGBT individuals, the General Assembly preempted all local protections with House Bill 2. A state cap on contributions transit funding also threw into doubt how municipalities would fund new light rail lines, even if they passed local sales taxes to pay for the lines.

In the face of recalcitrant legislatures, Katz encouraged cities to look to foundations, private businesses and other, non-governmental groups to partner with on major projects.

“While we’re in this period of hyper-preemption and almost know-nothing governance from the higher levels, it may mean some of the policies that need to be pursued come out of the private side in concert with local elected officials,” said Katz. “Your state government can always go on a frolic and detour...Then you send a signal that you’re a place that cares more about politics than business.”

Ely Portillo: 704-358-5041, @ESPortillo

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