Young professionals prefer more urban living environments

Young and educated professionals among the USA's largest metropolitan areas are moving closer to urban, downtown living spaces. The emerging popularity of city dwellers has resulted in the transformation of old, abandoned warehouses into modern historic apartments.

In almost over 70% of nation's 51 largest cities in the past decade, the population of college-educated individuals grew twice as fast within 3 miles of the urban center as in the rest of the metropolitan area. For states like Pennsylvania, that means more Philadelphia apartments for rent, with many unique living features.

Even in city of Detroit where the population decreased by 25% since 2000, the downtown area has witnesed 2,000 young and educated residents new residents, according to a Census analysis by economic consulting firm Impresa Inc.

Cities all over the nation are realizing an influx of young talent, and many developers are taking advantage of profitable opportunities.

Reinhold Residential is one company that specializes in architecturally unique, urban apartments designed with a luxurious and contemporary approach. Reinhold renovates historic warehouse buildings into quality living atmospheres. From luxury apartments in Chicago to glamorous pads in St. Paul, MN, the company is expanding parallel to the trends of migrating city residents.

In Cleveland, Ohio, the downtown area added 1,300 college-educated people ages 25 to 34. That growth of 49% has upped the demand for places to live.

Apartments in Pittsburgh have also been of higher demand with respect to the latter trends. More and more young professionals, especially in the fields of medicine, are seeking popular living hot-spots like Shadyside apartments, which neighbor the University of Pittsburgh Medical Center Shadyside Hospital.

David Egner, president and CEO of Detroit's Hudson-Webber Foundation, claims such data hints that they city of Detroit is on headed in the right direction. Three of the city's anchor institutions — Wayne State University, Henry Ford Health System, Detroit Medical Center — recently launched a campaign called "15 by 15." The program is designed to bring 15,000 young, educated people to the Detroit's downtown area by 2015.

The campaign boasts a powerful arsenal of cash incentives, including a $25,000 forgivable loan to buy (need to stay at least five years) downtown or $3,500 on a two-year lease.

Also seeing tremendous growth are the Loft District apartments in Baltimore. These contemporary living spaces are the ideal comfort retreat for the emerging mass of young city professionals.

As these trends continue, developers like Reinhold Residential will continue to pursue unique living spaces or potential warehouses capable of apartment makeovers.

Board OKs new Water Line in Gas Drilling Area

BusinessWeek

A Pennsylvania state water and sewer project financing agency on Tuesday approved nearly $12 million to extend municipal water service to residents of a small town who are complaining of tainted well water in the midst of heavy Marcellus Shale natural gas drilling.

State environmental regulators view the money approved by the Pennsylvania Infrastructure Investment Authority board as essentially a down payment, saying they plan to sue to recoup the money from Houston-based Cabot Oil & Gas Corp.

The board voted after hearing a lawyer's threat that Cabot will sue to overturn an approval, as well as pleas from Dimock residents who say that for two years, they have been unable to use their brown, methane-tainted and rash-causing well water.

One man from Dimock, a rural community 15 miles south of the New York border in northeastern Pennsylvania, toted a plastic milk jug of brown water -- poured from his tap, he said.

The clash between the state and Cabot over Dimock is Pennsylvania's highest-profile regulatory dispute in the Marcellus Shale since drilling crews, financed by cash from around the world, were lured two years ago by what could become the country's largest natural gas field.

"The only thing that I regret is that it's taken two years for this company, Cabot, to be faced with a solution," John Hanger, secretary of the Department of Environmental Protection, said after the meeting. "You saw today what Cabot does: They bring the lawyers in. They've done that for two years. They are unique in having lawyered up, as opposed to really dealing with the problem. Every other company I've dealt with ... has accepted responsibility and gone through the work of fixing the problem."

The applicant, the Pennsylvania American Water Co., would use the money to connect 14 households, and possibly more, to the water system of Montrose, a town about 6 miles away. Construction is expected to take more than a year, and would be completed after a newly elected governor, Republican Tom Corbett, takes office in January.

Cabot denies that it is responsible for the polluted water wells, saying its wells were properly designed and built to prevent gas from migrating underground and into the water table.

A Houston-based lawyer representing Cabot, Douglas Daniels, asked the board to put off consideration of the application, and said its rushed filing and consideration violates state laws and agency procedures -- assertions rejected by authority staff.

Daniels then said numerous parties, including some local governments, plan to sue over the approval.

"Because Secretary Hanger has made abundantly clear ... that he will seek to use the resources of the commonwealth to force Cabot to pay for this line, Cabot will have no choice to join in those efforts," he said.

The board approved a $11.6 million grant and $172,682 loan.

EDITORIAL: Marcellus Shale Tax a must for Pennsylvania

DelCo Daily Times

For the last couple weeks, the Daily Times Editorial Board has been interviewing candidates for state and local offices. There hasn’t been a lot of happy news coming out of those sessions — particularly those with incumbent state legislators.

Republicans and Democrats alike say Pennsylvania is staring at a fiscal abyss in the next year. With an economy that barely has a heartbeat, it’s being projected that the state is looking at a deficit of anywhere from $3 to $5 billion.

Making the situation worse is the fact that the man who is most likely to become the next governor — Republican Tom Corbett — has flatly ruled out any new tax or tax increase to help fill that gap.

(Corbett this week did propose one revenue producer: Selling the state store system. But that’s an idea that’s been bandied about Harrisburg for decades, always with the same result: An ignominious death.)

There is another source of revenue that most lawmakers deem promising. That is a proposed tax on natural gas extraction in the Marcellus Shale region — a rock bed the size of Greece that lies about 6,000 feet beneath New York, Pennsylvania, West Virginia and Ohio. Since late 2008, gas drillers have crowded the area, which they believe could supply the entire country’s natural gas needs for up to two decades.

Almost all of the natural gas produced in the United States is subject to a severance tax, which produces a significant source of revenue for a wide variety of services — as well as dealing with the inevitable environmental problems the extraction process, called fracking, produces.

Pennsylvania is the only state in the nation that does not impose a severance tax of any kind. That, according to the Pennsylvania Budget and Policy Center, has led to a $100 million loss of potential revenues in the last year alone. The commonwealth is giving away, for free, a one-time resource to energy companies that gladly pay for it everywhere else in the nation, the center said in a report issued Thursday.

Now, $100 million is a drop in the state’s money pit. But it’s nothing to be ignored.

How likely is it that the state Legislature will do the right — and fiscally responsible — thing?

It’s not looking good at this point. Harrisburg Democrats, seeing riches, are proposing substantial tax penalties; Republicans, saying they fear a big tax will scare drillers away, want minimal levies. Gov. Ed Rendell, who knows Corbett opposes any extraction tax, has been trying to play the middleman and bring those parties together.

But Thursday, he said that process “clearly is dead” for this year and blamed GOP intransigence. A spokesman for Senate Republicans said they were surprised by his stance, and they are willing to continue talking.

Perhaps it will take the November election to get the process going again. If Corbett wins, as expected, that may spur responsible members of both parties to come to an agreement.

Clearly, the tax is the right thing to do. The prospect of drowning in $5 billion worth of red ink makes it the necessary thing to do, too.

Penn Evaded Harvard Losses With `Defensive' Fund, Marks Says

Bloomberg

The University of Pennsylvania, the Ivy League school founded by Benjamin Franklin, outperformed its wealthiest peers by avoiding many hard-to-sell assets such as real estate, according to Howard Marks, former chairman of the the investment committee.

Penn held less in private equity and property, more in stocks and owned a “defensive” mix of hedge funds, as well as “substantial” cash and short-term U.S. Treasuries, Marks wrote in an Oct. 20 memo to trustees, obtained by Bloomberg News. The Philadelphia school’s investments fell 16 percent in the year ended June 2009, versus the 27 percent and 25 percent declines of Harvard and Yale, the two richest U.S. universities.

“Most things in investing are two-edged swords: if you do more of them, you’ll make more if they work but lose more if they don’t,” wrote Marks, chairman of Oaktree Capital Management LP in Los Angeles, who left his endowment post on June 30. “Two prominent examples are (1) using borrowed money, or ‘leverage,’ to magnify results and (2) investing in illiquid assets that can’t always be sold on demand other than at a substantial discount from their fair value.”

The $5.7 billion fund outperformed Harvard in Cambridge, Massachusetts, and Yale in New Haven, Connecticut, again in the past year, while still trailing them over the last decade. Yale’s David Swensen pioneered the strategy of using private equity, real estate and commodities to beat stocks and bonds. These infrequently traded stakes ballooned as a percentage of big endowments when markets tumbled after the September 2008 bankruptcy of Lehman Brothers Holdings Inc.

5.6% a Year

Penn averaged annual increases of 5.6 percent in the past decade, compared with the 7 percent and 8.9 percent returns at Harvard and Yale, and its own target of 8.25 percent. In the year ended June 30, Penn gained 13 percent on investments, tied for third-best in the Ivy League, while Harvard’s $27.6 billion endowment climbed 11 percent and Yale’s $16.7 billion fund advanced 8.9 percent.

Columbia University’s $6.5 billion fund in New York led with a 17 percent gain, followed by Princeton University’s $14.4 billion endowment in New Jersey, which increased 15 percent. Cornell University’s $4.4 billion endowment in Ithaca, New York, matched Penn last year.

Yale was the worst performer among the eight Ivy League schools, while Harvard ranked fifth.

Marks, 64, started Oaktree after leaving TCW Group Inc. in 1995. The firm managed $75.1 billion, as of June 30, in investments including distressed debt, high-yield and convertible bonds, private equity and real estate. Marks, who graduated from the Wharton school in 1967, served on Penn’s investment committee for 13 years and established the Marks Family Writing Center in 2003 on campus.

Not ‘Superhuman’

“As I wrote last year, ‘everyone had regrettable investments in his or her portfolio -- given the climate, you’d have to be superhuman not to,’” Marks said in his final letter to trustees after 10 years as the head of Penn’s investment board. “What matters is how many, how big and how bad Endowments in general had more of these than other investors in 2007-08, and thus they experienced bigger problems.”

Robert Levy, chairman and chief investment officer at money manager Harris Associates LP in Chicago, has taken over the chairman role at Penn, Marks said yesterday in a telephone interview.

“Investors have a choice between trying to maximize and trying to build in security,” Marks said in the interview. “There isn’t a right over wrong. Everybody has to make that choice for themselves. I think the events of these recent years demonstrate that choice and action.”

Stressing Stability

Penn’s investment committee emphasized stability over maximizing returns and achieved “a respectable return and minimized disappointment and difficulty in bad times,” Marks said.

In the past decade, the endowment added holdings of non- U.S. equities and hedge funds, lessened its preference for value stocks over growth companies, diversified its mix of investment managers and added venture capital and buyout firms, albeit to a smaller extent than its peers, Marks wrote. In 2004, the school appointed Kristin Gilbertson as CIO, growing its internal endowment management capabilities, he wrote.

The Ivy League schools are private institutions in the northeastern U.S. None has recouped the record losses incurred in the year ended in June 2009. As investments tumbled, universities cut jobs, froze salaries and postponed building projects.

Penn dodged the hundreds of layoffs, construction delays, discounted sales of illiquid investments and debt issuance of several of its peer institutions because the university was less dependent on its fund, getting 10 percent of its budget from endowment earnings, Marks said. In comparison, Harvard and Yale get more than one-third of their budgets from endowment income.

“Never forget the 6-foot-tall man who drowned crossing the stream that was 5 feet deep on average,” Marks said. “Prudent financial management doesn’t get you through ‘on average’ -- rather, it enables you to survive the low points."

Pennsylvania Airport with Feral-Cat Problem announces Plans to trap, neuter and release Cats

LA Times

 

ALLENTOWN, Pa. — An airport in eastern Pennsylvania that is dealing with a feral cat problem has announced plans to trap the felines and send them to a farm -- not euthanize them.

Lehigh Valley International Airport has reached an agreement with the Allentown group No Nonsense Neutering.

The Morning Call of Allentown reports the airport plans to have the cats trapped, spayed or neutered and then sent to a farm.

Animal lovers were upset last month when the airport said it would consider killing the cats.

Martha Kahan, president of No Nonsense Neutering, says the new agreement is a "win-win."

On Saturday, she trapped three of the cats and she says she plans to keep trapping them until she gets them all.

Rehabilitating the Housing Authority

Philadelphia Inquirer

This old agency is in dire need of repairs. The legislature can help.

The maelstrom surrounding the Philadelphia Housing Authority and its former executive director, Carl Greene, has yielded promises to do better. We can probably expect a new director, and maybe some new direction, soon.

But all may be for naught if we don't address the root of the problem: the lack of coordination between the Housing Authority and the city government. That can't be remedied without state legislation, which determines how the Housing Authority is run.

As it stands, the commonwealth requires the authority's governing board to include two members appointed by the mayor, two appointed by the city controller, and a fifth chosen by the other four members who is supposed to represent tenants. As such, the agency does not have to coordinate its efforts with the city administration. Regardless of his or her morality and competence, no PHA executive director is obligated to heed the city government or its elected officials.

No other U.S. housing authority of any size is run this way. The PHA's counterparts in other cities are generally controlled by mayors and city councils.

It took a scandal
 

We need to make the Philadelphia Housing Authority - which has a $400 million budget and ranks fourth nationwide in housing units - similarly accountable to the city.

The state law governing Pennsylvania's housing authorities was written during the Great Depression. The structure of government has changed dramatically since then, and public housing has become a far greater part of the city. Its integration with city planning and budgets is long overdue.

It shouldn't have taken a scandal to make us recognize the problems inherent in the Housing Authority's long-standing lack of accountability. True, the PHA - like many other housing authorities in Pennsylvania and the rest of the country - has taken advantage of changes in federal policy and demolished many dangerous, crumbling high-rises. And it has replaced some of their units with safer, cleaner, more efficient, low-rise housing. But that shouldn't have blinded everyone to the agency's flaws.

Now several members of Philadelphia's legislative delegation have promised to press for reforms to the Housing Authority's structure and oversight. The state House Urban Affairs Committee plans to hold a public hearing Thursday on updating and improving the state housing authorities law (Act 265 of 1937).

Corrective measures
 

I will be urging lawmakers to take the following steps:

Add a provision saying that all Housing Authority board members appointed by elected officials serve at the pleasure of those who appointed them.

Expand the PHA board to include seven members, as the legislature did in Pittsburgh, four of whom are appointed by the mayor.

Instead of the city controller, give City Council, which is intimately involved in housing and community development, the power to choose two appointees to the board. One should be picked by Council's majority leader, and the other by the minority leader.

Create a mechanism for Housing Authority tenants to choose their own representatives.

Eliminate the recently enacted provision calling for five-year contracts for Housing Authority employees. Three years is a more reasonable term.

Subject all Housing Authority subsidiaries and related organizations to the rules that apply to public agencies, including the open-meetings and right-to-know laws.

Require that the financial statements of any Housing Authority subsidiary or related organization be consolidated with the financial statements of the Housing Authority.

The state legislature cannot let this issue fester much longer. The current controversy could bring the PHA to a near-standstill and jeopardize its ability to qualify for some federal funds.

Pennsylvania needs to move quickly to change the way the Philadelphia Housing Authority is run. Some of our neediest citizens depend on it.

Philadelphia School Partnership Launches

Kansas City Star

Organization Pledges to Raise $100 Million to Support High Performing Charter, District and Parochial Schools in Philadelphia
 

Today marks the official launch of the Philadelphia School Partnership-- a collaboration of business leaders, foundations, city leaders and educators from the School District of Philadelphia, public charter and parochial schools. The goal of the Philadelphia School Partnership is to make Philadelphia the highest performing city in the country in terms of educational achievement by 2015. The Philadelphia School Partnership will do this by increasing the pace of education reform in Philadelphia and by financially supporting great schools that can serve additional students within the charter, District and parochial school systems.

The Philadelphia School Partnership has established a five-year goal to raise $100 million and to strategically invest the funds in initiatives that will directly increase student performance across Philadelphia. To date, the Philadelphia School Partnership board and anonymous donors have seeded this fund with $16 million.

"The Philadelphia School Partnership speaks, acts and stands for quality education for the children of Philadelphia, wherever they attend school,” said Mike O’Neill, Chair of the Philadelphia School Partnership Board of Directors. “This organization is a public recognition that we share more educational goals than differences and that now, more than ever, Philadelphia has to pull together to support this common agenda.”

Central to the Philadelphia School Partnership’s approach is working with innovators from the three major schools systems in the City: public charter, District and parochial. The organization will invest in high performing schools that agree to be held accountable for achieving outstanding levels of academic achievement for the students they serve. The organization will monitor school performance and will continue to work only with schools that achieve the highest levels of student achievement.

The Philadelphia School Partnership has the support of city and state leadership, including Mayor Michael A. Nutter who commented on the impact of the organization.

“The Philadelphia School Partnership can be a powerful and inclusive new force in the city with the ability to create tremendous positive change for the children in all of our schools,” he said. “We support their focus on creating quality seats and on activating parents as the primary advocates for their children.”

A launch event will occur today at 10 am at the National Constitution Center. Remarks will be provided by Mike O’Neill, Nick Torres; Executive Director of the Philadelphia School Partnership, Representative Dwight Evans, State Senator Anthony H. Williams and Lori Shorr; Chief Education Officer from the Mayor’s Office of Education. More than 200 top education, government, business and philanthropic stakeholders are expected to attend the announcement.

Philadelphia School Partnership

The Philadelphia School Partnership is a collaboration of business leaders, foundations, city and state leaders and educators from public charter, District and parochial schools. The organization works to ensure that every child in Philadelphia attends a great school and graduates from high school prepared for college or the work world.

The goal of the Philadelphia School Partnership is to make Philadelphia the highest performing city in the country in terms of educational achievement by 2015. To get there, the organization leverages philanthropic giving to serve as a catalyst to increase student achievement in schools across Philadelphia.