“Pittsburgh was the economic basket case of America 20 years ago,” former mayor Tom Murphy said, speaking at a recent ULI Belgium event. The southwestern Pennsylvania region was economically depressed after the decline of the steel industry, said Murphy, with more than 50,000 people per year leaving Pittsburgh for greener pastures.
Murphy said that at one point, someone put up a billboard that read “Last person out shut the lights off.” But that was the situation when he was first elected mayor in 1994.
Intentionality made the Pittsburgh transformation possible, said Murphy, who led the city until 2006 and is now a ULI senior resident fellow and the Canizaro/Klingbeil Families Chair for Urban Development.
Intentionality is about the choices that city leadership makes: Do we invest money in a new highway, or spend that money on expanding public transportation? Murphy’s push to raise taxes and spend more as a city in dire financial straits got a lot of resistance.
The choice we made was “breaking from our past and embracing an uncertain future,” Murphy said. That was not always easy to do—steelworkers wanted their jobs back. Murphy, in pursuing new economic possibilities, was essentially telling them their jobs were not going to come back.
At the time, graduates of Carnegie Mellon University with startup ideas had to go to New York City or Boston to make them happen because that is where the venture capital was. Stopping the “brain drain” started with building new infrastructure for technology. Pittsburgh financed buildings on the Carnegie Mellon campus for corporations to use for research in partnership with corporations including GM, Yahoo, and Intel. And in 2016, a total of $235 million in venture capital was invested in Pittsburgh.
Working in a steel mill did not even require a high school diploma, so Pittsburgh’s graduation rates were understandably low through the 1990s. One driver for getting the city schools’ graduation rate from 63 percent in 2007 to 74 percent in 2014 was the Pittsburgh Promise: Business leaders funded an initiative to award $30,000 scholarships to any public school student who graduates with a B average and good attendance.
And perhaps the two most visible areas in which Pittsburgh made improvements were reclaiming industrial land for other uses and supporting culture and arts.
The city government bought thousands of acres of abandoned steel mills and pursued public/private partnerships to turn them into new developments. The $338 million the city has put into these projects so far (and earned back) has generated more than $3 billion in private investment.
To fix the lack of culture funding in the city, “We raised taxes on ourselves,” Murphy said. A one-half cent sales tax increase helped fund the Pittsburgh Cultural Trust, which invests millions of dollars per year into the symphony, ballet, and other artistic endeavors in the city. While Pittsburgh, like many Rust Belt cities in the late 20th century, lost many jobs in manufacturing, industries including education, health services, and business services are growing today.
In 2014, the Economist ranked Pittsburgh among the most livable cities in America. Google, Uber, and Apple all have offices in the city. G.E., Kraft Heinz, and other public corporations have moved their offices from the suburbs closer to the city to chase the talent. “People used to move where the jobs are; now, jobs are moving where the people are,” Murphy said.
“Do you have the leadership to make it happen?” Murphy asked the crowd. “You have to know what you want to see. Do you want to be a city that reaches for the future or be a city that rests on its past? How cities make those choices determine whether a city is successful or not.”
