Op Ed: To Thrive, Cities Must Cater to Diverse Interests

Brandon Figliolino
June 12, 2018

I had the pleasure of traveling to New York City for the first time when I was twenty-seven.  For years, I was interested in visiting one of America’s metropolises, that one in particular.  I had grown up in a Denver suburb and wanted to experience what I believed to be a built environment rivaled by none.

The city, which was once just a hub of finance and commerce, has evolved into a booming economy made up of diverse populations (Judd & Swanstrom, 2015).  Before the trip, I reached out to friends who had lived and/or visited the Big Apple to ask why they loved NYC.  Everyone gave me different responses.  My friends Geo and Pat enjoyed the city’s theatrical offerings.  Chris loved the sports scene.  Aleah found economic opportunities that were unmatched in other localities. Ruben, who was my traveling partner on the trip, enjoyed the variety of eateries.  My friend Paul simply felt like he belonged.

While there, Ruben and I experienced a lot of the activities that our friends enjoyed.  We took in the show Kinky Boots on Broadway.  We could hear the roar of the crowds at nearby MetLife stadium as they cheered on the home team.  Of course, we also dined at various restaurants and bistros.  In between the constant photos I made Ruben take of me in front of landmark buildings like the Empire State Building, I kept thinking about how amazing it would be to put roots down there.  Ruben would remind me that living here without making six-digit salaries would make us destitute because of the high cost of housing; I pretended not to hear.  I had been there only two days, yet I felt like a part of the community.

My friends were right.  New York City did not cater to financial bankers; there was something for everyone.   In a globalized world, people have more choices when it comes to where they live and recreate, making the competition between cities to attract people aggressive (Judd & Swanstrom, 2015).  To succeed, New York City continues to attract a strong workforce by providing people with many economic opportunities.  It is through this diversification of industries that NYC is able to expand and attract cultural amenities like the ones Ruben and I enjoyed on our visit, too (Glaeser, 2018).

Walking through the city, I did my best to ignore the negative externalities I saw.  One day, we took a break and enjoyed coffee in a café located in the SoHo neighborhood.  Looking through the window, we saw a famous designer walking by, doing his best to step over the mounds of garbage that littered the sidewalk.  Later, we chose to ride the subway home to our hotel.  The ride was cramped and shaky, and took what felt like ages to get to our stop.  We didn’t even bother trying to hail a taxi; traffic was bumper-to-bumper.

A city’s increasing popularity comes with these types of logistic, housing, and infrastructure challenges.  Such issues shouldn’t be ignored.  Globalization makes it easier for residents to leave “intolerable” urban conditions (Judd & Swanstrom, 2015).  If cities cannot solve these problems in a way that pleases even the most “discordant interests” of its residents, those residents will leave (Kantor & Judd, 2016).  

These problems are not insurmountable.  Consistent engagement with residents, businesses, and community leaders can help government officials formulate effective solutions (Glaeser, 2018; Judd & Swanstrom, 2015).  This collaboration further attracts new businesses and employees to the city, bringing with it improved quality of life for residents as a whole (Kantor & Judd, 2016). 

My visit to New York City was unforgettable.  It demonstrated that when a city embraces different cultures and ideas, business flourishes, and with that entrepreneurial success comes greater cultural amenities and recreational opportunities.  Cities struggling to improve the quality of life for residents should follow the Big Apple and embrace innovation and unique perspectives.   Although NYC experiences challenges with housing and infrastructure, because leaders have embraced new economic sectors, and created a positive culture around diverse populations, the city has greater capacity to overcome adversity.   

References:

Glaeser, E. (2018) “It’s time to embrace our cities.” TED. Retrieved from: www.youtube.com/watch?v=ILDwnzQNlGc.

Judd, D. & Swanstron, T. (2015) City Politics. 9 ed. Pearson: Boston, MA.

Kantor, P. & Judd, D. (2016) American Urban Politics in a Global Age. 7 ed. Rutledge: New York, NY.

Denver and the Economics of a Winter Olympics

Brandon Figliolino

PUAD 6600 Economic Development

Denver and the Economics of the Winter Olympics

March 4, 2018

            An exploratory committee in Colorado is investigating the feasibility of Denver hosting a future Winter Olympics.  Their discussions have renewed the debate over the economic benefits of hosting such a large-scale event.  Proponents of the games believe it could be a catalyst for economic growth, not just in Denver but across the state.  However, opponents are skeptical of such benefits and believe the Games would leave Denver paying off massive amounts of debt.

            In the past, host cities have focused on public funding to build the necessary infrastructure for the Games (McBride, 2018).  Over the decades, this infrastructure has proven to be expensive.  This is a primary economic argument against hosting.  Since 1960, no Olympic Games has finished under budget, and only a few host cities have made a profit on them (Aleem, 2018; McBride, 2018).  If past Games’ performance are a good predictor of performance, it is unlikely that revenues would exceed expenditures if Denver undertook hosting.

            Opponents also argue that the infrastructure that is built for the Olympics is not sustainable.  The Olympic Stadium in PyeongChang is set to be demolished after only several days of use because it is too big to be used again (Aleem, 2018).  Infrastructure that is not torn down is left to decay, all while the government makes payments on the construction loans used to build it.  In Rio, for example, stadiums and highways were abandoned, and athlete housing has yet to be converted to affordable housing (McBride, 2018). 

The opportunity costs for hosting are also extensive.  The money used for Rio’s infrastructure could have gone towards cleaning up pollution in their rivers, which might have drawn more tourists and businesses to the area (McBride, 2018).  Land use can also be an expensive opportunity cost, especially if the use is abandoned after the Games or not aligned with the needs of the community (Applebaum, 2014).  Lastly, taking on debt for the Olympics might make it more difficult for host cities to secure financing for future projects (McBride, 2018).

            Supporters of their cities hosting the Olympics believe that the Games can act as a catalyst for economic development.  While there are mixed results, some host cities have seen a positive impact on tourism during and after hosting an Olympics (McBride, 2018).  This additional revenue may not have come without the help of the Games.

            Hosting an Olympics also spurs major development projects, proponents argue.  Such projects can include transportation infrastructure, like highway improvements, railways, and airports (Aleem, 2018; Murray, 2018).  Transportation projects, when done well, can lead to economic growth (Adams & VanDrasek, 2007).  Because of its size, hosting an Olympics would require a host city to invest in the transportation system, which would improve mobility for residents long after the Olympic torch is extinguished.  

The Olympics exploratory committee in Colorado is moving forward with their investigation into the feasibility of hosting.  Over the past several months, they have engaged with community members and stakeholders to identify whether Mayor Hancock and Governor Hickenlooper should submit a future bid.  A primary focus of the committee is reducing the negative effects seen in past Olympics.  The committee is doing this by forging partnerships and leveraging resources. 

To reduce taxpayer costs, they are looking to finance most of the Games privately.  Athlete housing, for example, would be built by a private developer, and any expansion of I-70 West would be managed by a public private partnership (Dutta, 2018; Murray, 2018).  Supporters of this plan believe using private financing, coupled with federal funds, would eliminate potential risk to taxpayers if the Olympics fail to generate projected revenues, since very little public money would be used to pay for it.

The committee is also looking at how it can leverage current assets.  Instead of constructing large stadiums, they are hoping to use utilize existing properties, like Coors Field and Mile High Stadium (Murray, 2018).  Any other required stadiums, including a venue for skiing, would be privately financed and temporary, so it could be dismantled afterwards (Dutta, 2018).   

Denver should approach the Olympics with caution.  Much of the opposition to hosting the Games comes from concerns over how to pay for it (Hernandez, 2018).  While the committee plans on having private partnerships fund projects, they have no identified any partners yet (Hernandez, 2018).  If Denver fails to secure financing partners, taxpayers may have to pay to the developers’ share.  Some proponents argue that hosting the Games would bring in federal funds to improve infrastructure, including I-70 (Hernandez, 2018).  The President’s infrastructure plan, however, shifts most of the funding responsibility to localities, so federal funding may be minimal (DePillis, 2018).

            Compatibility is another issue that needs special attention.  The committee discovered that hosting would require Summit County to build 12 to 15 story housing structures (Dutta, 2018).  In a county with small-scale towns, such large buildings would be out of place, and may not be utilized to full capacity much after the Games conclude.  Infrastructure that is built but does not provide long-term benefits to the communities might become derelict and cause negative externalities, as seen with Rio’s athlete housing projects (McBride, 2018). 

            Lastly, the committee should look at the jobs that would be created by hosting.  Many of the jobs that come with the Olympics are in construction or are short-term (McBride, 2018).  For a state that is experiencing a shortage of construction workers, it may not be realistic for Denver to find skilled workers to build the infrastructure (Douglas, 2017).  Focusing on attracting businesses that can bring in long-term, high-paying jobs may be a better return on investment for city and state staff than courting the Olympics.

            Hosting an Olympic Games is neither easy nor affordable.  It poses challenges and opportunities for cities and their regional partners to undertake.  If Denver does decide to bid, it will be imperative for decision-makers to review past Games’ successes and failures, and work with community and business partners to reduce risks.  Hosting is a challenge, and it will take thoughtful planning to ensure it produces more economic benefits than costs.

References:

Adams, J & VanDrasek, B. (2007). “Transportation as Catalyst for Community Economic Development.” Center for Transportation Studies. Retrieved from: http://www.cts.umn.edu/Publications/ResearchReports/reportdetail.html?id=1546

Applebaum, B. (2014) “Does hosting the Olympics actually pay off?” The New York Times. August 5, 2014. Retrieved from: https://www.nytimes.com/2014/08/10/magazine/does-hosting-the-olympics-actually-pay-off.html

Aleem, Z. (2018) “Why almost no one wants to host the Olympics anymore.” Vox. February 21, 2018. Retrieved from: https://www.vox.com/world/2018/2/23/17008910/2018-winter-olympics-host-stadiums-cost-pyeongchang

DiPillis, L. (2018) “Trump unveils infrastructure plan.” CNN Money. February 12, 2018. Retrieved from: http://money.cnn.com/2018/02/11/news/economy/trump-infrastructure-plan-details/index.html

Douglas, E. (2017) “Colorado faces massive shortage of construction workers. A fix won’t be easy.” The Denver Post. July 2, 2017. Retrieved from: https://www.denverpost.com/2017/07/02/colorado-massive-shortage-construction-workers/

Dutta, D. (2018) “2030 Olympic bid for Denver would require major land, housing commitments for mountain towns.”  The Summit Daily. March 1, 2018. Retrieved from: https://www.summitdaily.com/news/2030-olympic-bid-for-denver-would-require-major-land-housing-commitments-for-mountain-towns/

Hernandez, E. (2018) “Cross-section of opinions at latest Olympics bid listening session.” The Denver Post. March 4, 2018. Retrieve from: https://www.denverpost.com/2018/03/03/olympics-bid-listening-session/

McBride, J. (2018) “The economics of hosting the Olympic Games.” Council on Foreign Relations. January 19, 2018. Retrieved from: https://www.cfr.org/backgrounder/economics-hosting-olympic-games

Murray, J. (2018) “Cost of a Denver Winter Olympics—and how to pay for it—are chief concerns in bid question.” The Denver Post. February 26, 2018. Retrieved from: https://www.denverpost.com/2018/02/26/how-to-pay-for-denver-winter-olympics/