Mark VanderSchaaf, director of regional planning, Metropolitan Council
competitiveness is new emphasis for Metropolitan Council
A Civic CaucusFocus on CompetitivenessInterview September 13, 2013
Dave Broden, Janis Clay, Paul Gilje
(coordinator), Randy Johnson, Sallie Kemper, Dana Schroeder, Clarence
Shallbetter, Mark VanderSchaaf, Fred Zimmerman. By phone: Audrey Clay.
Mark VanderSchaaf has served as
the Director of Regional Planning for the Metropolitan Council of the
Minneapolis-Saint Paul Area since 2004. He oversees a staff of 30
planners responsible for key elements of the region's planning cycle:
trend analysis and land-use forecasting, staff assistance for regional
policy making, reviews of local comprehensive plans, and funding for
the region's park and recreational trail system.
Before coming to the Metropolitan Council,
VanderSchaaf earned an M.S. in urban and regional planning from the
University of Wisconsin-Madison and worked for 17 years as an economic
planner with the Saint Paul Department of Planning and Economic
Development. In that capacity, he was instrumental in crafting
Saint Paul's riverfront revitalization strategy and linking it to
riverfront projects elsewhere in the Upper Mississippi River Valley.
VanderSchaaf says the Twin
Cities region is highly competitive economically within the nation,
with a very diverse economy, good availability of an occupationally
diverse workforce, good productivity and notable business cost
advantages. He says the region can expect to continue with economic
strength. He notes, though, that other metro areas have had more
aggressive economic competitiveness strategies than the Twin Cities
region. He says the Metro Council is doing something about that
through its Thrive MSP 2040 project, which will set out
plans and goals for the region's economic and other growth over the
next 30 years.He notes that economic competitiveness is a new emphasis
for the Metro Council and that the Council is exploring whether it
could play a role in promoting economic competitiveness in local
VanderSchaaf reports that the Metropolitan
Council's new preliminary forecast at the regional and local level for
2010 to 2040 shows the seven-county metro area's population growing by
31 percent, the number of households growing by 41 percent and the
number of jobs growing by 37 percent.
He says the Council sees a recent trend
toward recentralization of people and jobs, and greater value placed
on accessibility and quality of place. Its 2040 forecast for the
central cities and the metro suburban/rural area projects this trend
into the future. Between 2010 and 2040, the forecast predicts that the
population of Minneapolis and St. Paul together will grow by 24
percent, while jobs in the two central cities will grow at the much
higher rate of 47 percent. But in the region's suburban and rural
areas, population (33 percent) and jobs (35 percent) will grow at
nearly the same rate.
VanderSchaaf noted that on Sept. 11, 2013,
the Council released its preliminary forecast of population,
households and employment at the city level for 2040. "This is work
that's been going on for five years," he said. "We have a pretty
sophisticated forecasting model now, which is much better than 10
years ago. We have a much better understanding of the region's economy
and demographic trends and how that's likely to affect locational
The Council released its preliminary
regional forecast in April 2012. For links to both the local and
regional forecasts, click
He clarified that, by law, the Metro
Council's jurisdiction covers seven counties: Anoka, Carver, Dakota,
Hennepin, Ramsey, Scott and Washington. He said those seven counties
contain 87 percent of the population and 90 percent of the jobs in the
Census's 13-county metropolitan statistical area "The seven counties
are still the economic and population center of the region," he said.
The Council's preliminary 30-year regional
forecast predicts the following:
Population: The seven-county metro population will grow by
893,000, or 31 percent, between 2010 and 2040, from 2,850,000 to
3,743,000. Natural population growth, or births outpacing deaths, will
account for two-thirds of the population growth, with the other
one-third resulting from migration, chiefly international immigration.
The population of people of color will more than double over the next
30 years, growing from 24 percent of residents in 2010 to 43 percent
Households: The number of households in the metro area will
grow by 458,000, or 41 percent, between 2010 and 2040, from 1,118,000
to 1,576,000.The size of the average household will decline from 2.50
people in 2010 to 2.32 in 2040.
Employment: The number of jobs in the metro area will grow by
570,000, or 37 percent, between 2010 and 2040, from 1,548,000 to
The Council's preliminary 30-year local
forecast predicts the following for the metro area's central cities
and suburban/rural areas:
Minneapolis: The city's population will grow by 105,000, or 27
percent, between 2010 and 2040, from 382,700 to 487,700. That accounts
for 12 percent of the region's population growth during that period.
In contrast, the job growth in the city will be 137,000, or 49
percent, between 2010 and 2040, from 282,000 to 419,000. That accounts
for 24 percent of the region's job growth during that period.
St. Paul: The city's population will grow by 54,000, or 19
percent, between 2010 and 2040, from 284,900 to 338,900. That accounts
for nine percent of the region's population growth during that period.
In contrast, the job growth in the city during that time period will
be 77,000, or 44 percent, from 176,400 to 253,400. That accounts for
13 percent of the region's job growth over the 30 years.
The central cities together: The joint population growth of
Minneapolis and St. Paul between 2010 and 2040 will be 159,000, or 24
percent, from 667,600 to 826,600. That represents 18 percent of the
region's projected population growth during that time. In contrast,
the joint job growth of the two cities from 2010 to 2040 will be
215,000, or 47 percent, from 457,500 in 2010 to 672,500 in 2040. That
represents 38 percent of the region's job growth during that time.
Outside of Minneapolis and St. Paul: The region's suburban and
rural population will grow by 727,000, or 33 percent, between 2010 and
2040, from 2,182,200 to 2,909,200. That represents 81 percent of the
region's projected population growth during that time. Jobs located in
the suburban and rural areas will grow by 376,000, or 35 percent, from
1,084,000 to 1,460,000. That represents 66 percent of the region's
projected job growth over that time period.
Thus, although the central cities'
population will grow at a slower pace (24 percent) than the
suburban/rural population (33 percent) from 2010 to 2040, the
central cities' job growth will be at a faster pace (47 percent)
than in the suburbs and rural areas (35 percent).
Asked to state the problem the growth
forecasts reveal, VanderSchaaf said they show first, bad news; second,
good news; third, bad news; and fourth, good news.
First, the bad news: From 2000 to
2010 the Twin Cities region showed stagnation in jobs for the first
time since World War II. "In every decade since WWII," he said,
"we had at least 150,000 net new jobs, until 2000 to 2010. We had
really bad news at the end of the last decade, but not much job growth
in the beginning of the decade, either."
"The severity of the Great Recession took
everyone by surprise," VanderSchaaf continued. In the forecast
10 years ago, the Council was expecting 210,000 net new jobs from 2000
to 2010. Instead, net metro area jobs declined by more than 62,000.
Second, the good news: Other regions
experienced the same economic challenges. "We weren't alone in
this experience in the country," he said. "The whole decade was a lost
decade for the economy. People weren't seeing this at beginning of the
decade. We understood it better in retrospect."
The economic fundamentals are still strong
in the Twin Cities area. VanderSchaaf said Todd Graham, the
Council's principal forecaster, working with a national forecasting
firm, finds that the region is highly competitive within the nation,
with good availability of an occupationally diverse workforce, good
productivity, and notable business cost advantages. "We have a really
diverse economy, not overly reliant on any one sector," VanderSchaaf
said. "We can expect to continue with economic strength. But none of
these things happens automatically. They are a result of a myriad of
decisions at the public, private and nonprofit levels. Assuming we do
the right things, we've got the fundamentals to continue to be strong
well into the foreseeable future."
The region's share of national Gross
Domestic Product (GDP) will increase by 2040. VanderSchaaf said
the region's economy now contributes 1.35 percent of GDP, although we
have less than one percent of the U.S. population. That's expected to
grow to 1.5 percent of GDP by 2040. "I'm even more optimistic for the
Twin Cities," he said, "because other forecasters haven't factored in
natural resource constraints in metro areas around the country.
Forecasts for robust growth in places like Austin, Texas, don't really
take into account that Austin is just about out of water. Our region
has some great resources that we're working to preserve and protect."
Third, more bad news: Other metro
areas have had more aggressive economic competitiveness strategies
than the Twin Cities region.
VanderSchaaf noted that the National
Association of Regional Councils (NARC) was retained by the McKnight
Foundation to do a study of what regions are doing to enhance their
economic competitiveness. NARC did a survey of all major metro areas
around the country, with a more in-depth study of three regions:
Kansas City, Denver and Seattle.
One key finding of the NARC report is that
the Metro Council has the largest operating budget (close to $800
million) of the 14 metropolitan region organizations responding to the
survey. VanderSchaaf said the size of the budget reflects the
Council's unique role as regional planner and metropolitan planning
organization, but also as a provider of transit and wastewater
treatment service, and funding partner for housing, brownfield cleanup
and transit-oriented development projects. But, he said, it was the
only organization surveyed without a regional economic strategy.
Fourth, more good news:
The Council is doing something about it.
VanderSchaaf said the Council's goal is to
update its long-range, 30-year plan, called
Thrive MSP 2040.
He explained it as "a policy strategy leading to detailed plans for
regional systems: transportation, wastewater and the parks and trails
system." According to state law, Thrive MSP 2040 shall guide
"the orderly and economical development, public and private, of the
metropolitan area" and "recognize and encompass physical, social or
economic needs of the metropolitan area."
This fall, he said, there will be outreach
and engagement around the basic policy themes articulated by the
Council. This first part of Thrive MSP 2040 will be finalized
by April 2014.
Some of the themes emerging in Thrive MSP
2040 are the following:
Continuing to take care of our finite resources in an efficient and
Planning for ongoing economic prosperity.
3. Equity: Promoting
both racial and income equity, and geographical balance.
Maintaining our region's high quality of life.
Ensuring that our region remains strong and vibrant for generations
A strategic and tactical goal of the Council
is to create a robust partnership for economic competitiveness.
VanderSchaaf said all the various actors in the region that have a
bearing on the economy need to align around a shared economic
strategy. This strategy will need to involve partners in three
interrelated arenas: economic development (transactions to strengthen
employers in core sectors of regional economic strength), community
development (infrastructure and amenities), and workforce development.
"The goal for the Metro Council is to be an important participant and
a leader to bring about this robust strategy for our region," he said.
Economic competitiveness is a new emphasis
for the Metro Council. But, he said, the Council's long-range
planning and infrastructure investments already advance regional
economic prosperity by
Planning for the efficient movement of people and freight globally,
nationally and regionally;
Providing cost-effective and efficient wastewater treatment;
Contributing to a quality of life and cost structure that attract and
retain a talented workforce;
Working with local jurisdictions to provide access and infrastructure
to employment locations;
Creating a consistent framework for land-use planning.
The Council's specific contributions to
regional economic competitiveness lie in the arena of community
development: supporting the infrastructure, amenities and quality of
life that are essential to attracting and retaining businesses and
The Council is exploring whether it could
play a role in providing advisory leadership in promoting economic
competitiveness in local comprehensive planning.
An interviewer asked whether that would
cause more competition for businesses among municipalities in the
region. "That's always an issue," VanderSchaaf responded. "But there's
a paradigm shift. An awareness is starting to creep through the U.S.
and the world that metropolitan areas are the engines of growth or
brokenness in our country. We didn't create a political and governance
system that was attentive to metropolitan areas. They didn't exist at
"There are cities and there are states," he
said. "The city used to be the metropolitan area. Now we have suburbs
that are their own center. It's dysfunctional to think of Minneapolis
vs. St. Paul or St. Louis Park vs. Hopkins. It's better to think of
our metro area vs. others in the country and the rest of the world."
(He recommended the book
VanderSchaaf said this is an organizing
principle for the Greater MSP group. "They don't call it clusters,
they call it areas of strength," he said. "There are certain key types
of businesses that we do really well in our region. The industry
cluster notion looks at interrelationships among various sectors that
support our key areas of strength. Are you overrepresented in
employment compared to rest of country? If so, that's an area of
He offered the example of Rochester's Mayo
Clinic being concerned about other metropolitan areas competing in
health care around country. Rochester received a large investment from
the 2013 Legislature to enable the Mayo Clinic to continue to expand
in that city. To be competitive, he said, a metropolitan region must
have a high quality of life, good technology infrastructure and a high
quality airport or port facilities or freight transportation.
An interviewer commented that Minnesota's
economic development needs improvement. He said people working on
economic development don't recognize the importance of supplier
networks, because there are no people with industrial experience
working in economic development. He said 1.5 million manufacturing
jobs were lost in metropolitan areas in the 1990s, while those jobs
grew in nonmetropolitan areas.
The Metro Council is not directly involved
in workforce development.
The Council sees a recent trend toward
recentralization of people and jobs, and greater value placed on
accessibility and quality of place. An interviewer commented that
most of our transit system is focused on the downtowns. It doesn't
connect people in the suburbs with their jobs and doesn't connect
people in the cities with real jobs in the suburbs. Part of the
transit system must be realigned, he said, but we're investing in
major spokes going into and out of downtowns. "There's a big
disconnect between what we're doing and what exists."
VanderSchaaf responded that a big part of
the disconnect gets to density and potential ridership. Council and
Metro Transit staff completed a 2013 analysis finding that the
greatest ridership response to transit is in localities that have a
combination of population density, destination density, compact,
walkable urban form and connectedness. "When we're prioritizing
investment and operations, it often will come down to how can we move
the most people most efficiently" he said. "If the jobs and the
population are thinly dispersed, it's very hard to do that."
The same interviewer posited that the two
downtowns account for 15 percent of jobs in the metro area and that 85
percent are outside of the downtowns and, for the most part, outside
the central cities. "When is the Council going to come to grips with
that reality in transit?"
VanderSchaaf responded that 31 percent of
metro area jobs are sited in the central cities. "Part of the trend
we've started to see in the last five years, and we believe it will
continue, is recentralization of jobs and people in the region. Part
of it is a result of fewer resources for highways. Growth that's
occurring on the fringes of the area is happening without
significantly increased levels of infrastructure investment.
Congestion remains a challenge and that's part of what's driving
investment more and more into areas that already have infrastructure."
"In the last five years," he continued, "the
aging population, the new millenials and new Minnesotans are more
likely to want places that are more compact and more walkable. Five
years ago, conferences on industry and commercial space never talked
about transit. Now transit is a key issue, even in the industrial
spaces." He noted that a speaker at one conference commented, "Out in
the exurbs you can build stuff overnight, but it takes three years to
fill; in the central city, it will take three years to build, but it
will fill up immediately."
The Metro Council does not lobby the
Legislature for additional powers. An interviewer commented, "It's
disappointing that we were the first region with legislative enactment
of a metropolitan council, but I don't have the sense that the Council
is at the Legislature lobbying"
"We lobby for regional investment, but we
don't lobby for additional powers," VanderSchaaf said. "We leave it to
others to lobby for us. We need to be fulfilling the demand of the
community, rather than trying to steer the community. That's served us
well. 2013 was the first year in my memory that no legislation was
introduced to disband the Council."
He said that this approach has been
effective in the area of water supply, where the Council runs the
wastewater system. He noted that drinking water supply has been a
matter of local control. The Council now knows more about groundwater
than 10 years ago and has a pretty good idea why White Bear Lake is
shrinking. "We know what the solutions might be," he said. "There's
starting to be groundswell that someone has to do something about this
and isn't the Metro Council the right one to help this happen? We're
ready to step in with a variety of forms of assistance to help the
region solve this problem."
The Council does not do forecasts for all 13
counties included in the Census definition of the Twin Cities
metropolitan area. VanderSchaaf said the Council has jurisdiction
in the seven counties only and the state demographer does demographic
(but not economic) forecasts for each county in the state.
The current Metro Council is more eager to
play a broader leadership role than it was in recent years. In
response to a question, VanderSchaaf said the governor and legislative
leadership have a hand in setting the tone and expectations for the
Council's level of activism.
Regional property tax-base sharing is not
under the jurisdiction of the Council An interviewer commented
that we as a state decided in 1971, through what's often called the
Fiscal Disparities Law, to share the tax base of 40 percent of new
commercial-industrial development throughout the seven-county area. He
noted that the law was under attack this last session and asked where
the Metro Council is on that.
VanderSchaaf responded that the Council sees
regional tax-base sharing as beneficial to the region as a whole. "But
it's not under our jurisdiction, even though it's something the
Council cares about," he said.
The controversy over locating the Southwest
light-rail transit (LRT) corridor will be resolved more amicably than
it appears now. "I see a decision coming that people can live
with," he said. "I'm seeing something emerging." He commented that the
Southwest LRT line, which will run between Eden Prairie and downtown
Minneapolis, is generally not as controversial as was the Central
Corridor line, which has been built between downtown Minneapolis and
downtown St. Paul. "Today residents aren't asking 'if' they will
get LRT in their communities, but 'when,'" he said.
Minnesota Department of Transportation
Commissioner Charlie Zelle is the point person on the larger
transportation solution for the region. An interviewer asked about
the Metro Council's role in determining how to
finance the construction and operating
deficit of the region's transit system. VanderSchaaf said the Council
works closely with Zelle.
"Our transportation policy plan is fiscally
constrained, so everything we do has to be fundable," VanderSchaaf
said. "The governor wants a complete solution for the whole state that
includes highways and transit."
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David Broden, Janis Clay, Bill Frenzel, Paul Gilje,
Jan Hively, Dan Loritz (Chair), Marina Lyon, Joe Mansky,
Tim McDonald, John Mooty, Jim Olson, Wayne Popham and