Raising Sights

Why nonstop service to and from PDX is critical to Portland's ability to attract and retain headquarters

This week's Portland Business Journal includes an excerpt of a conversation between Daimler Trucks North America COO Roger Nielsen and the Charlotte Businesss Journal which underscored to me the critical importance of achieving more frequent and non-stop air service to Portland's viability as a business center.

Despite being founded in Portland and a long history in the Portland area, the company has relocated several hundred positions to Fort Mill, SC in recent years. In response to a question about the benefits of now having the administrative arm of Daimler Trucks in the Charlotte area and close to four major plants, COO Roger Nielsen shared this:

One of the reasons we located in Charlotte was it's not only our manufacturing base, it's also a nice place to be headquartered for our customer base and our supplier base. Eighty percent of customers and 80 percent of our suppliers are east of the Mississippi. When you think about that, it's nice having our customer-facing staff here in Fort Mill. It's much more convenient.

We've found that as the airlines started cutting back on service and started loading up planes, it was difficult for our sales and marketing people and our service people being headquartered in Portland to work with our customers all week, fly home on a Friday night and get home to Portland by midnight. (emphasis added)

Now I am able to get a flight out at 7:30 to Indianapolis, get to the supplier at 10, stay with the supplier until 5 in the afternoon and be back home and I grilled steaks at 8:30 last night in Waxhaw.

via portland.bizjournals.com

While Portland will never be as close to the east coast as Charlotte is, limited non-stop options to and from PDX only amplify the competitive disadvantage of being based in Portland compared to regions with stronger air service.

Based on our research, PDX currently has non-stop service to 27 of the top 50 airports in the US (PDX is ranked #30 based on 2009 passenger volume). Download PDX_nonstop_service_to_top_50_US_airports (as of October 15, 2010).

Insights worth sharing from a ULI event earlier this year

Earlier this year, I attended an event hosted by the Urban Land Institute (ULI) titled Follow the Money: Stimulating Better Communities (original page is offline, here is a link to Google's cached version). As I was cleaning out some files at the end of the year, I came across my notes from that session and a few stood out as worth sharing here:

For those interested, here is a link to the presentation by Maureen McAvey (PDF), an executive vice president with the Urban Land Institute (bio). Metro Councilor Rex Burkholder also presented, but did so without a slide deck.

Maureen:

• Transit - national; land-use - local.
• The idea of an Infrastructure Bank: China, Japan and the EU each use this approach with the EU providing $52 billion annually to focus on major linkages (via 50 year loans). The US does not currently use this approach. 
• Crisis often accelerates change, but doesn't change its basic direction.
  
• Just 22-23% of households have kids under age 18 in US.
• Only 1/4 of trips are commute-related.
  

Rex:

• Transportation: has gone from 9% to 20% of household budget (note: I did not get source or dates for these stats so am citing here more for the trend than the absolute values).
  
• Top 50 MSAs are responsible for 60% of US economic activity yet contain less than half of population.
• $660 million is spent annually on transit in metro Portland (again, not source cited).
  
• High speed rail - we should fund but we're not.
  

What this means:

1. Our current system of significant transportation decisions being made on a national level and land-use decisions being made on a local level doesn't help us to make livable connected communities. We need to coordinate strategy at the local, regional and national levels to achieve better outcomes.
   
2. We desperately need to invest in our crumbling and overstretched infrastructure. My sense is that this country invested heavily in its interstate highway system and other initiatives decades ago and has largely rested on its laurels while demand has continued to increase and infrastructure has continued to age. The Sellwood bridge is but one small example.
   
3. While we need to preserve a range of housing options (including new single-family detached residences), a significant number of households are apparently are not the stereotypical family with kids anymore. This has significant implications for how we plan our communities.
   
4. Households are spending both more time and more money commuting and the majority of those trips are not related to work. Yet, most of our local strategy has been focused on the 25% of trips that are work-related (Trimet MAX, WES, etc.). We need to think more holistically and recognize that the odds of anyone living at one MAX station and working at another aren't that high. Encouraging local first-and-last-mile connectivity (i.e. from home to store or work to store or frankly, from transit stop to destination) is critical. 
5. High speed rail. WSDOT has a long-range strategic plan for Amtrak Cascades (PDF). I've read it. ODOT does not. Rail isn't the holy grail, but we do need to get serious about it. Look at what California is proposing: San Francisco to Los Angeles (432 miles) in 2 hours 38 minutes. Or China: Beijing to Shanghai (819 miles) in under four hours. Remind me why it takes 6 hours 30 minutes to go 310 miles from Eugene to Seattle on Amtrak Cascades?
   

Infrastructure: $10 billion is needed, let's get working...

Friday's Oregonian notes in the fifth paragraph of a story titled "Sewage backup: Would you like one?" that, "According to an analysis by Metro, the regional government, meeting the population and job growth in Multnomah, Clackamas and Washington counties will require infrastructure improvements of $27 billion to $41 billion. Even if that growth doesn't occur, the region's infrastructure needs $10 billion worth of repair..."

Malu Wilkinson, a Metro planner, is quoted as saying, "We're trying to emphasize that this is not just a problem of growth. It's also a problem of living off investments made 30, 40, 50, or 100 years ago--without reinvesting (emphasis added)."

We need to aggressively re-evaluate our collective priorities. Infrastructure isn't exciting, but it is essential. Much like Maslow's hierarchy of needs, I would argue that having sound infrastructure with sufficient capacity is foundational and a prerequisite to more exciting projects (arts and culture funding, parks, social and community programs, etc.). For too long, we have lived off the courageous leadership and ambitious infrastructure investments of previous generations. It's time to start thinking big again.

At the ULI Central City symposium on Thursday, someone mentioned the 200+ mph MagLev trains that China now has in some of its cities. I'm sorry, the Portland Streetcar and MAX are nice, but not in the same league at all. We need to invest in (among other things) high-speed, high-capacity transit along the I-5 corridor as soon as possible. While we continue to drink the Kool-Aid about how cool Portland is (most recently from the NYTimes), we have lost our edge. Together, we can do this, but the time is now.