Cleveland’s Economic and Transportation Assets Can Position Region to Overcome Recession, Poor Infrastructure Investments

CHICAGO (May 23, 2011)—Despite a persistent high unemployment rate and a history of inefficient development, Cleveland has the economic and transportation assets to foster sustainable future growth, according to a new analysis of Cleveland’s regional economy by the Center for Neighborhood Technology (CNT). The analysis found that a focus on transit-oriented development around three of the city’s fixed rail stations would enable the city to capitalize on national real estate trends when the economy and housing market rebound. It also found that attracting industrial and logistics businesses around the convergence of the Port of Cleveland, Interstate 77, and two Class 1 freight rail lines would allow the region to take advantage of the expanding freight rail industry.

“The Cleveland region generates the greatest single portion of the state’s economic activity, but its development patterns over the years have undermined rather than reinforced its sizable economy,” said Scott Bernstein, president of CNT. “Cleveland is at a turning point: continue with the status quo, stretching jobs and people farther and farther apart, or forge a new path.”

The Cleveland report is part of a broader partnership with CNT, then-Governor Ted Strickland’s administration and nearly 50 leaders from the public, private, and non-profit sectors in Cleveland. The two-year project analyzed the economic development opportunities in Cleveland, Columbus and Cincinnati.

Specifically, the Cleveland report documented that:

  • Since 2000, homebuilders constructed 48,831 more units than the market could support.
  • Residents spend more than $8.5 billion dollars per year to pay for transportation, with gas costs alone draining $1.2 billion dollars from the local economy. As Cleveland residents face gas prices of $4 per gallon, their spending on gasoline alone could surge beyond $3.2 billion a year if their travel patterns stay the same.
  • Auto-dependent, high-transportation-cost neighborhoods have as many as 1 in 3 properties with a second mortgage or a home equity loan.
  • Retirees and young professionals are projected to demand more compact development through 2030, but as a whole these kinds of developments are in short supply in Cleveland.
  • National investors rank Cleveland as one of the least favorable markets for multifamily and mixed use development.

The CNT report identified several strategies that Cleveland could implement to promote growth that is more efficient for household, business, and municipal budgets. The strategies include:

  • Moving forward with the proposed Blue Line extension at Warrensville and Van Aken. An extension of the Blue Line to the Outerbelt would bring transit to a major employment center and increase job access for households living along the entire system.
  • Encouraging transit-oriented development in Downtown, University Circle, and Shaker Square. These places sit at key hubs of the city’s rail system, share a stable housing market, and possess a street grid that makes it easy for residents to walk to destinations.
  • Promote cargo-oriented development (COD). CODs bring industrial and logistics businesses together with access to multiple modes of freight transportation, complementary firms, and a ready workforce. Cuyahoga County boasts a fresh water port, two rail-to-truck intermodal terminals, 20 transloading facilities, and ample rail service from Norfolk Southern and CSX. The region should capitalize on these assets to attract businesses to nearby underutilized industrial sites.
  • Make better use of the Port of Cleveland. The Port of Cleveland is the fourth busiest US port by tonnage but could take better advantage of trends that favor shipping by making upgrades to the port with resources from the US Department of Transportation, Economic Development Administration, and Ohio Department of Transportation.
  • Directing public investments that affect housing and economic development to areas where the combined cost of housing and transportation do not exceed 45 percent of household income. CNT’s Housing + Transportation Affordability Index analysis found that less expensive communities in Lorain, Geauga, Medina, and Lake Counties may be out of reach for some because transportation costs often meet or exceed the cost of housing.

“The region’s economic development efforts need to refocus on investments that make the region more economically and environmentally resilient,” said María Choca Urban, CNT’s director of Transportation and Community Development. “The prevailing development patterns of the past here in Cleveland, across Ohio and across the country contributed to the current economic situation of foreclosures, recession and unemployment.”

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CONTACT:
Emily Robinson, Center for Neighborhood Technology, erobinson@cnt.org, 773-269-4043

Founded in 1978, CNT is a Chicago-based think-and-do tank that works nationally to advance urban sustainability by researching, inventing and testing strategies that use resources more efficiently and equitably. Its programs focus on climate, energy, natural resources, transportation, and community development. Visit www.cnt.org for more information.