Oil Drum


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NullspacePittsburghers know that the times are out of joint. Somehow they're expecting the prosperity to blow up in their faces.
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"the highest top hourly wage of any metro area when adjusted for cost of living"Top hourly wage? of ANY metro area. Really? I'd challenge to PG folks to find the reference that has adjusted wage levels for transit drivers for each and every metro area in the nation as they claim. Sure makes it sound like the local operator wages are off the chart when compared to everywhere else.
So is the Port Authority average wage on the high side, yup, but certainly not the highest by any means. Cut a few percentage points and the wage would drop a lot further in that ranking.
Here is the thing that goes unmentioned. Of all the transit agencies in the nation I bet the Pittsburgh area has had the lowest population growth in recent decades. Thus the Port Authority sufferes from an afflication of most industries in the region that are population dependent and thus have not had much growth in decades. I bet that if you compared the Port Authority to all other transit agencies, a smaller proportion of their current workers have been hired in the last 10 years than elsewhere. Why does that matter? I bet a lot of the transit agencies that have lower average wages are really places where they have a lot of junior workers whose wages are on the lowest part of their salary scale. Thus its not a fair comparison at all to say that one transit agency's entire compensation system is . Like a lot of things affected by our extreme demographic, this is one of them I would put good money on. If true, this type of ranking is saying nothing more than the Port Authority's workers are older and more senior than their colleagues working for other transit system. I am sure the Port Authority would love to get rid of its oldest and highest paid workers, but there are these little laws against age discrimination that would get in the way even if their labor contract didn't prohibit that selective type of layoffs.
This is a big issue for a lot of private sector industries as well, but is very much at issue in a lot of public sector workforces that derive their 'demand' from the population size. Lots of local school districts have some fairly senior workers as well, expecially compared to places in the South and West which have seen the fastest growth in recent decades. If you look at the full file, you will see a lot of those lowest paying agencies are in Florida or other places which have seen the highest population growth in the last decade.
So why do they keep getting away with the metric that the Port Authority's wages are 'highest'. First they don't compare themselves to the all transit agencies in the nation, only a subset of transit agencies around the country. Then they 'adjust' the salaries for regional cost of living differences using something I use often which is the ACCRA (now called COLI) cost of living index. That is fine for many things, but that index explicity states it is for higher income professional households who are likely to be choosing between different regions to live in. I think that disclaimer pretty much disqualifies it from applying it for blue collar bus operator wages whom I doubt are being recruited by transit agencies in other regions very often... It's just not the right metric to use in this case. Ironically it would be the right metric to compare Steve Bland's salary to other transit leaders and anyone truly considered professional 'management' at the Port Authority. Funny how this adjustment is not applied to the analysis of management salaries.
Even so, why not use that same 'adjustment' when looking at everyone else's wages and salaries. I bet you yourself would be shocked at how your wage comparesif adjusted by a similar means and compared to the same regions used to compare Port Authority operator wages. Most everyone in the region would be considered overpaid if we applied the same methodology for other occupations, something I doubt we agree with without deeper inspection.
Rumor: The lock out of Port Authority is 98 percent certain.
"Jefferson County confronts a crisis involving a sewer debt of $3.25 billion that was incurred under court order pursuant to the federal Clean Water Act. Which of the following courses of action should be taken by the county? Select One:
- Attempt to implement a plan under Chapter 9 of the federal bankruptcy law that would repudiate all or a significant part of the sewer debt.
- Default on the payment of the sewer debt and accept the appointment of a receiver for the sewer system with power to raise sewer rates within the limits of the law to remedy such default.
- Pay the sewer debt in full by reducing the amount payable from sewer revenues and using various tax revenues to pay a portion of the debt. "
Developments like this are always unique and it may not make sense to compare this plan to things like Bakery Square or 'Eastside'. In fact the difference here is just how close in to residental neighbood this is compared to either of those. Bakery Square is taking advantage of the defunct old Nabisco plant on a stretch of Penn Ave that is mostly institutional. Eastside as it were is mostly on top of what was the parking lot for Yellow Cab for decades. On one side is mostly commerical/institutional development in East Liberty. As the crow flies it is close in to residential parts of Shadyside, but parts that are seperated pretty cleanly by rail and bus lines. Even the Children's Hospital development is really a massive infill of what was a large hospital. So from a sheer neighborhood transformation perspective, this one project is pretty different.
Add to that the planned expansion of the Hillman Cancer Center, let alone the nearby construcion of Childrens Hospital and it really adds up to a lot of development. Actually I was shocked a couple months ago when I saw a listing for a house nearby. When I bought my house in the mid 1990’s there were several houses for sale on a single block at the border of Friendship and Bloomfield (let's not even get started on neighborhood definitions around here). At the time the price for each of them was close to $50K. I saw one listed recently for over $300K.
Even the Bloomfield Bridge Tavern is documenting the change in its own way, and I suppose nothing will bring Winky's back?
Have not had a contest here in some time... who knows where Autenreiths was?
Accrued Liability:
So you have to ignore the one big jump in the late 1990's. Some know the history that pension funds for the city were due to run out of money completely in the late 1990's and the solution put forward at the time (by the Competitive Pittsburgh Task Force and by others) was to float a large bond, put the money into a balanced investment portfolio under the assumption that it would appreciate to the point of funding the pension system more fully. So that graph is supposed to have been marching upward. That has not exactly worked out as it was planned, nor is likely to at this point barring truly historic bull markets or other significant changes to how the pension system is funded. .
Which tells you something that is true for all of us who talk about region-wide metrics in any subject... what is going on in your specific neighborhood may be very different from what is measured for the region in aggregate. But overall the City proper is doing well compared to a lot of local municipalities and I am at a loss to figure how already near zero housing price in the Mon Valley are continuing to plummet.
Willow also has data for specific city of Pittsburgh neighborhoods. It shows Bloomfield one of the best performers over the most recent year at +10% year over year in value.... most of which came in just the last quarter. Eyeballing the map and matching it to that data seems a little odd to me. Looks like appreciation through a greater Bloomfield/Friendship/Lawrenceville nexus. Can you say Children's Hospital?
Another study out of note on housing is a recent NBER paper (subscription required): Housing Supply and Housing Bubbles by Edward L. Glaeser, Joseph Gyourko, Albert Saiz. NBER Working Paper No. 14193. July 2008.
That report looked at regional housing markets across the country. Pittsburgh housing is relatively cheap by another metric. According to the report Pittsburgh housing can be bought at over a 30% discount to what it would cost to build locally, one of the cheapest values for that calculation in the nation other than Detroit and DallasFort Wayne.
If remotely correct, those are some pretty amazing stats. 150 open spots out of 21K available spaces is a vacancy rate effectively zero right Downtown. Is frictional vacancy a term? How many parking spots could spatially constrainted Downtown supply before running out of demand?
For those looking for parking price rollbacks when the city's parking tax has to come down further, you may be looking in vain. If that slide is true, I can't quite figure why Downtown parking operators don't raise their prices if their spots are really well over 99% occupied. That puts in a different perspective all those who complain about the high rate of the Pittsburgh parking tax, or parking costs in general. It's one of those fundamental axioms of a free market that things are 'worth' what folks are willing to pay for them. From that data, the completely market driven price for parking in the Golden Triangle must be higher (not lower) than what is being paid currently.... whether the money collected goes to taxes or operators. For O if nobody else, maybe parking taxes are a second cousin of a land tax?
You could say the market would provide more spots if the tax was lower, but you would have to ignore the sheer topography of Downtown which is about as dense as you can get at less than a half square mile. You would have to park cars at Point State Park (yes, I'm sure some would like that) or try something equally creative. There are few realistic options.
I have to wonder if the existence of quasi-regulated prices in the form of the Pittsburgh Parking Authority actually acts to keep prices down. and imagine what demand for parking would be if gas was $1.00 a gallon as it was not very long ago.
The only area that has any measureable vacancies at all is the North Shore, which I suspect includes some relatively distant stadia spots. Anyone want to guess what will happen to those few spots once the NSC and T extensions are completed?
Soo.... maybe its time to bring up the recurrent idea of selling off the Parking Authority. There was a time the city of Pittsburgh effectively sold off its water system to raise cash just to get it through operating expenditures for a few years, an immensely bad idea for the long run. If it makes sense to sell off core infrastructure like the water system (or the PA turnpike as has been floated as an idea), is there any reason something like the parking authority could not be sold off and use the proceeds to pay off some of the city's debt? Maybe just the large attended lots Downtown. The reasons the Parking authority was created in the first place 60 years ago are probably not still in play. Consider also that if a completely market driven price gets driven upwards, even a lower rate of parking tax could possibly bring in more revenue to the city in the end... and then there is this little issue of taking a significant amount of property off the tax exempt list.