Important now: For many cities economic development in downtowns have been a focus for decades. It’s time to pay attention to the neighborhoods.
The main ingredients for success are well known to people who have it: ambition, drive, passion, determination, and hard work with a dash of luck. But what gives it its distinct flavor are the mentors and supporters who have enabled the rise.
That is why whenever Matthew Anderson, deputy city manager of Des Moines, IA has crossed the finish line of the 10 marathons and 6 Ironman triathlons he has completed, exhilaration is mingled with gratitude for the trainers and coaches who pushed him to get there.
“Ironman is a solo race, but I can’t imagine training alone. The same goes for city leadership,” says Anderson. “I may be the one that gets to be in front of the local news cameras, but I can’t do any of it without our 1,700 employees.”
He is equally beholden to the throngs of Des Moines enthusiasts who have shaped the alluring features the city has to offer. Before becoming deputy city manager, Anderson was director of economic development and surmised that his department was the least important in attracting new businesses to Des Moines.
“No one ever moved their company or their family here because they liked the ED guy or even the incentive package we put together,” notes Anderson. “They move their company here because they like our parks and trail network. They like our low crime rate and cleanliness, great schools and libraries, public art, and ridiculously quick commute.”
Anderson is likewise sanguine about what is in store for Des Moines this year. In the following interview he talks about why the city has fared well during the pandemic, how the leadership’s focus has shifted and which initiatives unfolding now will become economic smash hits.
How has Des Moines fared throughout Covid?
The entire state of Iowa has weathered well. In Des Moines, historically our economic ups are not as high, and our downs are not as large as some of the coastal cities. We tend to run more even-keeled and that’s because the nature of the economies we are based on. The whole state is rooted in agriculture which tends to fare well in down times. Also, Des Moines is the headquarters for very large insurance, finance and mortgage companies which have not struggled as much and in fact some have prospered during Covid.
We have had our share of restaurants and hospitality challenges like everybody else but if you were to compare us to a lot of our peer cities, we are weathering this quite well.
What restrictions were put in place when the pandemic hit?
Des Moines is a blue city in a red state like a lot of Midwest cities. Our governor was reluctant to issue mask mandates or prolonged closures. Back in April Iowa had restrictions on dining and entertainment venues similar to what everyone else has done. But for the most part Des Moines remained open.
Our mayor is the one that can declare an emergency proclamation. He has been conservative and methodical in his approach which has been really nice and calming. What happened is the governor took away home rule for cities and counties. Our mayor and a few others issued our own mask mandates anyway even though we don’t have the ability to enforce them; it would be challenged in court since the state hasn’t allowed us to do that.
But the mask mandates have been well received by businesses who wanted government leadership on things like masks and social distancing. The day after the mayor issued his mask mandate, I saw signs go up in every store downtown that masks were required.
What are some of the ways the city is helping businesses get back on their feet?
We did many things to assist restaurants with outdoor dining during the summer months. Once we got colder in November that was no longer an option. Restaurants have struggled but haven’t shut down; they have had lower capacity for a long stretch. The governor just released that but most of the restaurants are still imposing their own restrictions.
We have two primary programs for small businesses mainly focused on restaurants because they are the businesses that have been hurt the most. The first thing we did was loosen the restrictions on sidewalk dining and setting up in parking lots, which are still in place.
We also have our restaurant assistance program which is specific to reimbursing costs for ‘to go’ orders. A lot of restaurants have invested in things like special warming ovens that keep food warm while it waits to get picked up. Also, all of the packaging for to go orders are costing thousands of dollars per restaurant. We have a program in place where they keep their receipts and receive reimbursement. We want to encourage people to get their food to go and still support the restaurants versus sitting down in the restaurant.
We have had a handful of restaurant closures and are surprised many have weathered the way they have. Some that have closed were teetering on that decision anyway and this just forced their hand. We are remarkably proud and amazed how well they have weathered this, although I know they have struggled so I don’t want to sugarcoat it.
How badly hurt were tax revenues to the city because of Covid?
In Iowa we are primarily property tax driven and that is 18 months in arrears. When you pay your taxes and get your assessment there’s always a lag period. Housing is really strong and going up all over the county and warehouse and industrial is really strong. The only property tax hit we’ll have is in hospitality, which is pretty exclusive to hotels and motels. They are a small enough component of our property tax revenues that it will get offset by residential, multi-family and industrial.
Our assessor is just releasing new assessments for this fiscal year, so we won’t feel that until next fiscal year. We are just approving our upcoming fiscal year budget; we are adding a few positions and keeping the tax rates steady, so we have been very fortunate.
I understand city executives are still working remotely. How has that affected your mindset about working outside the offices?
All council meetings, planning and zoning meetings and engagements with the public have been done remotely. That’s been the most frustrating thing. Elected officials usually are out meeting with their various associations, constituents and businesses. They’re now having to do all that via Zoom and I know that has been frustrating for them.
We are starting to talk about when we will come back. Probably in late spring we will start doing more in-person meetings. City Hall is still closed, and all the city buildings have been closed to the public. Everything is being done online. We have been doing fire inspection and liquor license inspections online. A restaurant operator can get on FaceTime with the building inspector, so the inspector doesn’t go into the restaurant. We adapted to that quite quickly and it has worked out well. We now have digital tools in our toolbox when we need them, but I don’t think we will totally replace the old procedures.
A lot of exciting economic development initiatives are taking place in Des Moines most of which were already in the works. What are the priority initiatives this year?
One of the city council’s biggest priorities is neighborhood development. Our downtown has been a focus of our economic development efforts for the past 20 years. Our downtown has really become a different place. It used to be a strictly eight to five downtown, where we had a very few number of residents living there and it was truly a commuter downtown. There has been a big push to introduce more arts and culture downtown, more hotels, and more resident amenities. Now we have more than 10,000 housing units that didn’t exist 20 years ago.
We are not taking our foot off the gas in promoting the downtown, but city leaders want us to have a more honest focus on our neighborhoods. We are now seeing a lot more of that happening. We have created a new nonprofit entity and staffed it up to strictly focus on neighborhoods. We are starting to see private investment in older neighborhoods where we never had before.
We have a couple of old regional malls we’re focused on too and are seeing investments in and around them; they won’t become cancerous decay in the neighborhood.
One of those projects is the Merle Hay Mall redevelopment, which is a great example of how to repurpose an aging retail center. The vacant Sears store there was just demolished to make room for a Kohl’s department store. The roof on another vacant department store is being razed and a new hockey arena will be put there; a few other sheets of ice will be built adjacent to it. A new hotel will also be built. It’s a major, multi-faceted project on the mall property in addition to development that’s happening around the area.
I understand a new professional soccer stadium will be built on property that has been vacant for 25 years and designated as a superfund site. What were the factors that came together for the city to be able to jumpstart this project? (Read more on this project in the upcoming article in CityRevive).
We have been trying to get Dico [the superfund site] cleaned up and in friendly hands for 20 years but never made progress with the EPA; there were always lawsuits.
In the meantime, the Krause Group [the stadium developer] owns a lower tier soccer team and had applied for a higher tier USL [United Soccer League] soccer franchise, which is a second tier just below Major League Soccer. So, Krause bought up land adjacent to Dico and planned to put their stadium there.
Then, all of a sudden there was a flurry of actual progress between EPA, the Department of Justice, the city and Dico on how we were going to clean it up and transfer ownership. Once Krause heard that, they shifted gears and started preparing to refocus their stadium plans on the Dico site, with City Council’s blessing.
This freed up all the other land the company bought that is not contaminated. What was going to be a great stadium and a great anchor for the area got ten times better because so much land was freed up for more profit development.
There is going to be shared cleanup with a delineation of duties on what the EPA will do and what the city will do. EPA will start their part later this year and we will come right behind them and do ours. The buildings themselves are a tremendous eyesore and are a gateway to our downtown so just getting the buildings down and off the site will completely change the landscape in that area.
It is a superfund site with a lot of contamination and not much we as a city could do with it. We would have been pretty happy with just the asphalt cap and some green space on it. Stadium uses work really well on contaminated sites because nobody is living there, it’s not an enclosed structure, and you can keep the cap in place. From a redevelopment standpoint it’s one of the few vertical pieces of infrastructure you can put on a contaminated site.
The complete build-out of the site is expected to take 12 to 15 years and is will generate about $190 million in new revenue to the city over 20 years.
All cities will be racing for economic recovery as we put COVID behind us and these initiatives along with several others give Des Moines a head start in the race (read more details about these and several other projects in an upcoming article in CityRevive).
For more information contact Al Setka: AMSetka@dmgov.org