Too Soon to Say! Coronavirus Impacts on Planning, Investment & Regulation of Urban Mobility

Gabe Klein

As a national leader in the evolution of smart city transportation planning, pandemic, VX News asked urban mobility expert, and Cityfi founding copartner, Gabe Klein and senior associate, Abby Abel, to opine on the impacts of social distancing orders on cities: from empty freeways, vacant train stations, deserted boulevards, and canceled flights—and, on whether current public behaviors are challenging the assumptions and principles behind their firm's change-making work....going forward.

As the founding Partner of Cityfi, and a former DOT principal in the cities of Washington, DC and Chicago, how are you and your colleagues still with operational responsibility for public transit agencies reacting to the COVID 19 pandemic and truly dramatic declines in ridership. 

Gabe Klein: Like everybody else in the public who is experiencing this, it's a bit of an emotional roller coaster. There are times when you feel sort of lucky that you don't have the virus or that you're not suffering with it and your family is okay. 

But there are other times you feel guilty. Or times, you feel sadness. Like today, a very nice person I've met a few times in the mayor's office here in DC, died this morning from coronavirus. He was deputy attorney general for Washington DC for a number of years and then deputy general counsel for our mayor. 

It's starting to really hit close to home. I feel for the medical workers who are on the front lines and are starting to get sick because they haven't had the equipment that they need and are forced to be in, not only the general population now, but also with those who are very sick.

I think there's a palpable amount of anger, some at the federal government, or even state governments, that didn't take this seriously at the beginning. So, there's a lot of emotions running high. 

You see it on Twitter and other social media, where people who are normally pretty calm, are starting to lose it a little bit from a combination of what they're reading and experiencing and taking in, in real time, on social media or on the traditional news that they watch. 

And that’s combined with their lives being so disrupted. Some people are saying how great this is because we don't have to commute, and we're not moving and putting CO2 in the air.  But people like to get out of the house and go to work. They like their rituals. 

So, this is really shaking our society up. Particularly in America, where we really pride ourselves on our “freedom” and our ability to move freely between our home and wherever we want to go in the  States— by car—doing whatever we want. 

I think this is particularly tough for people and for anybody accustomed to using public transit, whether here or in Europe, Asia, or Africa. It's very hard to use these traditional shared mobility modes now. 

Abby Abel:  From my perspective working out of an office in Denver, Colorado, the responses to the pandemic are dynamic and varied. A number of major cities like Bogota, Columbia and Mexico City, have or are currently considering rapidly expanding temporary bike lanes to account for the surge in biking during the pandemic.

Two of the largest scooter companies have temporarily pulled their fleets from cities, citing their commitment to social distancing and the health of cities.  Public transit ridership is clearly down, and cities like Seattle are converting on-street parking spaces near restaurants to temporary loading zones to facilitate curb-side meal pickup. 

Given the changing dynamics, it’s not yet clear what all of this means for urban mobility/  What is clear, however, is that the urban movement of goods and services will continue to be a priority — everything from getting meals and medical supplies to those in need, to meeting rising on-line retail demand.  Surely, more employees working remotely coupled with digital infrastructure being built-out in real-time to support new work modes portends far-reaching changes in how cities manage the curb and our urban corridors.  

One silver lining, cities are presently benefiting from reduced traffic congestion and improved air quality. A more permanent shift in how people work, and the resulting reduction in traffic congestion, also could give cities the opportunity they need to reevaluate and repurpose urban streets. 

As a respected national leader promoting and strategically advising on smart city transportation planning, are the EARLY impacts of social distancing restrictions, mass layoffs, stay at home orders—the fact that freeways are empty at rush hour in California, train stations are vacant, and few flights are leaving airports as planned—causing you Cityfi to reassess the assumptions and PLANNING principles that you have advanced over the last five years?

Gabe Klein: People, for tens of thousands of years or more, have operated in a certain way. People crave the connection to other people and the energy from other people. I still believe that rural America and urban America are very much needed. But the suburban America we've created? We still need to urbanize that. 

Even though we're seeing social distancing, and we're seeing all the financial impacts on our way of life— on transit and bike share and scooter companies and all of that—I don't think it fundamentally changes the way either people are going to operate or the way the government is going to prioritize investment. We've had pandemics before, and we'll have them again. 

But on the other side of the coin, we have climate change. If anything, this terrible pandemic is causing people to realize that maybe we can’t rely on this idea that we’re in total control of our destiny—that we alone, through American exceptionalism—can always outmaneuver everything. 

When it comes to something like a terrible pandemic, or the environmental crisis that we're bringing upon ourselves, it's going to take collectivism to solve these problems. It takes everybody looking out for everybody else, and that's the way it works. And if you can't do that, then you can't solve the problem.

The pandemic doesn't know borders, and it definitely doesn't know state borders.

Neither does climate change. If we make a terrible decision in the US, it's going to affect Canada and Mexico and Europe. One of the bright spots—if you can even use the term bright spot in this situation we're in—is that it may cause people to think a little more critically and admit that collectivism is exactly what's needed. It's not just some sort of Northern European or European value; it's actually something we all need to embrace across the planet.

Abby, because Cityfi presumedly is asked often to offer strategic management advice on how cities should accommodate the public’s need to congregate, imaginatively grow retail commerce, and enhance environmentally redesigned urban mobility, permit TPR to ask the same question: Will the COVID-19 pandemic require you to tweak your strategic advice to any of your clients ? 

Abby Abel: It truly is too early to tell.  Clients presently are responding in different ways. Some are moving forward with their transportation plans, others are delaying their planning.  

One common theme among our public sector clients is a focus on government innovation—cities drawing upon available data, utilizing resources in new ways, and engaging the private sector to move quickly to address the immediate challenges to health and equity. 

These "new" approaches are very likely to influence how cities think about urban mobility and infrastructure planning in the future.  

Gabe Klein: I also think it's too early to tell; but we’re operating in real time, So, today, I'm encouraging some of our private sector clients, in particular, not to make drastic changes to their strategy based on the first 10 days of a pandemic. That doesn't mean that you don't need to right size your payroll and things of that nature, but when it comes to cities, one of the things that CityFi’s always been about is moving fast.

People might think of us as a traditional planning—or strategic planning or change management— firm.  But we very much like to get into the weeds with our clients and help them make decisions and implement change. We are operators at our core and work a lot with mayors. We are definitely being leaned on by clients, to give them advice, make decisions, and write policies fast to make adjustments to things like curbside policy.

There are things that are going to change. For example, there were cities that were looking at how to manage complex curb operations on a particular block. But now they're telling us that they don't know if the businesses on that block are going to come back after this is done. So yes, there are adjustments and changes, but I think, fundamentally, we are about change. We're about helping our clients through change and future-proofing them so that they can be as successful as possible. And that, if anything, is needed more than ever.

And your advice to local and regional operators of buses, urban light rail, shared ride, bikes & scooters?  What are their immediate concerns and needs? Are any considering how - going forward- to reposition any of their operations? 

Gabe Klein: Well, I would say public or private, we are absolutely advising them on right sizing their cost structure to the demand that they're seeing out in the market. If you're seeing an 80% drop in demand for your service, and it's looking like we're going to be in this situation for six-plus weeks, then how do you work to right size while impacting your employees or contractors as little as possible?

We're getting a lot of requests right now to analyze the stimulus that came out and see what the potential is. We were happy to see that the stimulus was going to be able to provide relief for contract workers and, for instance, that we got $25 million for transit—not that it's enough, but it's a good start. I think we'll probably need another stimulus.

Also, we're already talking to some clients about what they can do in the interim: What can they donate? How can they help their local city? Or, if they’re a national company—how can they help cities, period. Or,  charities.

To really position themselves, fundamentally, to come out of this with stronger relationships and with some goodwill earned. And with their employees, internally, feeling like they did something positive during the crisis. 

There are some big companies doing some really amazing things. You know, real time, Google came out today and said they're putting aside $800 million for loans, grants, and free advertising for small businesses. Or what Ford's doing by retooling their lines to make masks and ventilators. I mean, it's inspiring.

With the passage of the CARES Act this week, how might these new federal funds (as much as $25 billion for transit) be used most constructively to support your public clients operations?

Gabe Klein: I haven't had much time yet to analyze it in detail, and there are some things to interpret, but I think from the standpoint of plugging operating holes in the budget, and that's one of the biggest problems right now.

 There are a lot of particularly larger transit agencies that rely on the fare box recovery to make their budget work. So, when you see demand plummet by 50-80 percent, it's devastating to their budgets, for Metro here in DC, or LA Metro, or MTA.

So, for the larger agencies, it's a start in plugging some of those budget gaps.

I don't think we're going to see a lot of capital support. I just don't think there's enough for any capital upgrades, and, honestly, I don't think that's what they're thinking about right now. They're trying to keep people employed. 

They're trying to keep some semblance of service running, particularly for people who rely on it to get to hospitals, to get to grocery stores, to get to service jobs —and to access services—that are essential during the crisis.

This month’s TPR  will include an interview of MoveLA’s Executive Director Denny Zane focused on his vision for LA’s Grand Boulevards — what they should be like, could be like, and might be like — after accounting for the  impacts of COVID-19,  What's your take on the impact that COVID-19 might have on urban boulevards in the future? 

There are cities that are definitely thinking about how to reallocate space right now. Look at a city like New York, or in Tokyo, or in places where people have very small apartments and basically live on, and in, the public space for the most part. 

It’s where they recreate, where they gather, where they eat:  outside, in many cases. 

Bogota, also referenced earlier, is thinking “how do we quickly convert space over to people? Space for people walking, and for biking.” Because you don't want people walking, crammed together on a sidewalk, or biking in tight groups, and spreading this pandemic.

What I do not think we should be doing is thinking about how we, as governments and businesses, seize this moment in time to try to convert as much space as possible for the future. 

I think things like that will naturally happen if people start seeing the benefits of getting out there and walking and biking and riding. But what we really want to focus on is: what are the short term needs, now, during this crisis. 

There have been many conferences, including VerdeXchange, that have focused on what’s termed “the Amazon Effect,” i.e. on the impacts of online package delivery on urban form, mobility, commerce. As the general public, in reaction to Shelter in Place public mandates, to increasingly relying on online shopping, what do you imagine ramifications will be for the vitality of urban “main streets and boulevards?”

It’s sort of hard to watch. I use Amazon; I like Amazon. But if you look at the industries that were already teetering before this happened—look at local retail and restaurants— already overpopulated in many of our major metro areas and these types of businesses were, many of them, already in trouble. 

So, 78 percent of people are living paycheck to paycheck, but we need to remember that 40 percent of our businesses are running paycheck-to-paycheck as well. So, I think it's particularly devastating for these businesses.

 I wonder, depending on how long this goes on, what some of our main streets are going to look like, in our downtowns, in our small towns as we as large. I think it can be particularly devastating, and I think it's sad. 

But people have been moving more towards online shopping as it's gotten easier. There's less friction, and the delivery’s gotten faster. But I certainly hope that that we don't really fully move to that model and have empty storefronts throughout our cities.

Before we pivot to the heart of a recent Forbes article of yours, give our readers some insight into the  inner-sanctum of what the nation’s leading Mayor’s are prioritizing at their daily coronavirus crisis management meetings.

Gabe Klein: First of all, mayors and governors are leading right now. Overall, the offices that I come in contact with on the West Coast, the East Coast, and some in the heartland, are just doing a phenomenal job. 

I've talked to a few mayors’ offices. They are so focused right now on making sure they have hospital beds and ventilators and protective gear and that a lot of the critical people are focused on making sure it’s all set up for us for a projected spike. Let's hope that spike doesn't come in a lot of these cities. 

 So, to some extent, everything else can be a distraction. In some cities, though, you have a lot of people that that have more time to work, honestly, on the core issues that they've been focused on around policy or planning.

It’s really city-by-city, but I think they’re preparing operationally for a spike in cities like New York, San Francisco, Miami, New Orleans— cities that are under siege right now,

As noted above, you very recently wrote an article titled: Is Coronavirus & Its Economic Impact a Taste of What's to Come with Climate Change. Share the case being advanced for greater collectivism is response to both the current pandemic and global climate change?

Ever since November 2016, since the last election, it's been interesting to watch the stock market continue to skyrocket. It's felt dystopic to me to be honest. Because I've been a little depressed.

I've been thinking about how we're consuming a lot. People are feeling good about the about the economy, but something's just not quite right, and we all know it. 

Whether it's the forest fires in California and Australia, or the droughts, or the floods that we're seeing, at what expense, basically, are we experiencing this economic boom? 

There's been a disconnect between the long-term sustainability of our way of life worldwide and the short-term focus on profitability in the corporate sector, on Wall Street. And I'm very much a capitalist, but I believe in social responsibility. I don't understand how our corporations don't want to do good and make money.

I think it's because it's harder, it's harder to do good and make money. It's easy just to keep fracking, for instance. So when coronavirus started, when we started to see this happen and the market fall, I thought it was really scary and interesting.

Because to solve this crisis, we need to embrace collectivism, something that doesn't come naturally to Americans who are still fighting this invisible, imaginary battle with the British. But look at our friends to the north in Canada, they have a very different attitude, a different economy, and health care and college for everybody. 

This disconnect is tied to basically to environmental recklessness and a lack of full cost accounting for the impact and the footprint that we have on the planet. You can call it a carbon tax, but there are lots of ways we can address this.

But if we're going to start looking at the full cost accounting of the investments that we make or the spending that we do, then we can't just look at GDP. As important as GDP is, it's only a component of the full cost or benefit. 

I really believe that government, and corporations, need to put a social framework in place to look at the 30-year full cost accounting of everything that they're doing. Eventually, I think, government regulation will force this, because we'll be in a dire situation, as we are today with coronavirus, which is forcing us to look at the glaring reality of exactly what's happening right now. 

When coronavirus was impacting China a few weeks ago—before we realized we were already impacted— it was so easy to think of events like this as something outside of ourselves.

It's the same thing with the environment, and this “frog in the pot syndrome” where we don’t really recognize or react to danger, because the danger is happening too slowly or not noticeably, until it's born down upon us to the point where we can't fix it. 

Back to your experience in the mayoral administrations of two major cities, and now working with many mayors as clients, speak to the challenge of advancing a long-term investment strategy, and view of the world, with the short-term demands of interest groups who want to survive. The next day, give us a sense of what those kinds of conversations are within the sanctum of a city hall.

Gabe Klein: Obviously right now, today, cities and states are very much reacting to the situation that's unfolded and the lack, in my opinion, of federal leadership. In many ways, it's been the same story for a few years. Even during the Obama presidency, there was a lack of leadership for six out of eight years in Congress. 

Cities are getting very used to doing things for themselves. This is nothing new. But when we come out of this, I think we have to put a framework in place to evaluate every initiative, every large spend, and, maybe even smaller spend items, around a social cost benefit analysis.

I think once you see it, you can't unsee it. Once you learn that each fatality on your streets costs up to $4.5 million dollars, and it destroys people's lives, once you actually correlate the true cost of some of our decisions, you can't unsee it. 

I hope that in working with cities, we're able to help them put these frameworks in place that will ultimately save us from ourselves.

Lastly, given that the Mayor of Los Angeles is now the chair of C-40 global cities, what best practices in response to the global pandemic are you advising clients to emulate?

Gabe Klein: Mayors and their staff are doing a tremendous job. These are people sleeping in the office working 18 to 24 hours, just around the clock, I can't say enough good things about these folks.

One pertinent example, I think people made fun of Mayor London Breed when she first locked San Francisco down - thinking that was going overboard.  But today we realize that San Francisco needed to make bold, decisive decisions in response to the pandemic.

I think the Mayor of LA also has been doing a great job, not just making decisions, but of communicating extremely transparently, and clearly, what the trade-offs are, and why he's making these difficult decisions. 

We see a lot of communication, partnership, and information sharing regionally between mayors and governors, and nationally. So, I'm really impressed. I don't know that I would call out one particular city, but I think they're all doing extremely well. 

They're making up for a lack of consistent leadership at the federal level, which is really sad because this is exactly the type of situation – to avoid competitive bidding for much needed N95 masks - where you need that steady, consistent leadership and resources. 

“When it comes to something like a terrible pandemic, or the environmental crisis that we're bringing upon ourselves, it's going to take collectivism to solve these problems. It takes everybody looking out for everybody else, and that's the way it works. And if you can't do that, then you can't solve the problem.” —Gabe Klein