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In 1995, seeking to streamline mortgage processing, Fannie Mae, Freddie Mac, and a group of banks came together to create a new company to register and assign mortgages. The company, Mortgage Electronic Registration Systems, Inc. (MERS), served as a way for mortgage originators to quickly process new mortgages, centralizing files and cutting down on the need to deal with local government record keepers. With banks increasingly focused on bundling, securitizing, and selling off mortgages they had originated, MERS was designed to move mortgages more rapidly off their hands and into the booming mortgage-backed securities market. The goal of the process, as stated by MERS, was to simplify “the way mortgage ownership and servicing rights are originated, sold and tracked” while also eliminating “the need to prepare and record assignments when trading residential and commercial mortgage loans.”

The business model proved wildly successful. According to the New York Times MERS now “claims to hold title to roughly half of all the home mortgages in the nation — an astonishing 60 million loans.” However, as the system boomed in an era of rampant mortgage speculation and securitization, criticism arose. Detractors, such as Professor Christopher L. Peterson of the University of Utah School of Law, argue that MERS is based on a “problematic legal doctrine,” and that by “adopting such a radical shift in how mortgages are recorded and foreclosed, without legislative change, the mortgage finance companies have rebuilt their industry on a legal foundation of sand.” According to Peterson,

“The shift away from recording loans in the name of actual mortgagees and assignees represents an important policy change that erodes not only the tax base of local governments, but also the usefulness of the public land title information infrastructure. MERS did not, by itself, cause the mortgage finance crisis and its ensuing aftermath. But it was an important cog in the machine that churned out the millions of unsuitable, poorly underwritten, and incompletely documented mortgages that were destined for foreclosure.”

As foreclosure rates have risen, so have legal challenges to the role of MERS in the process. Such cases have, among other issues, questioned the right of MERS to act as the “mortgagee of record,” and to initiate foreclosure proceedings. Results have been mixed. Judges in California, Massachusetts, and Kansas have ruled that MERS “has the authority to initiate home foreclosure proceedings.” MERS itself points to rulings in several other states that it claims show it stands on solid legal ground. However, courts in New York, Florida and Oregon have ruled otherwise, with multiple rulings in Oregon throwing a wrench into the foreclosure market in the state. MERS, in an apparent attempt to clear up issues of standing in foreclosure proceedings,recently began encouraging its members to stop making foreclosures in its name, and is now proposing new rules to curtail the practice.

Some local governments are also exploring potential legal and legislative investigatory proceedings against MERS, upset at the banking industry’s use of MERS to avoid paying local recording fees for mortgages. Given the dire state of state and local budgets, and the unpopularity of the financial industry, it bears watching to see if more local governments follow their lead in an attempt to recoup a source of funding that was previously theirs. MERS and its financial industry backers appear to be girding themselves for coming legislative battles, launching "an aggressive campaign on Capitol Hill to bolster the legality of the way companies have turned mortgages into securities." With housing markets already on shaky ground, and talk of a double dip in prices beginning to surface, the uncertain future of MERS and the mortgages it holds is yet more potentially bad news for areas struggling to recover from the housing bust.

Data is now available for 20 of the nation’s 52 metropolitan areas with more than 1,000,000 population. The early results indicate a pattern of accelerating dispersion of the population to the suburbs as is indicated in the table below. Thus far, historic core municipality growth has been approximately one-half the 1990s rate. During the 2000s, the historic cores have accounted for 8.8 percent of metropolitan growth, down nearly one-half from the 1990s rate.

Results just announced for the 2010 Census show that the Kansas City metropolitan area grew 10.8 percent from 2010, from 1,836,000 to 2,035,000 persons. As in all of the major metropolitan areas (over 1,000,000 population) for which data has been reported, the bulk of the growth was in the suburbs, rather than in the historical core municipality (Kansas City).

The suburbs captured 91 percent of the metropolitan area growth, with a growth rate of 13.0 percent. Nearly one-half of the metropolitan area growth was in Johnson County, Kansas. The Kansas City metropolitan area is unusual among bi-state metropolitan areas, because the population is relatively evenly split between Missouri (location of the historical core municipality) and Kansas, with 58 percent in Missouri and 42 percent in Kansas.

The historical core municipality of Kansas City gained 4.1 percent, from 442,000 to 460,000. Based upon the 2009 Census estimates, this population was approximately 24,000 lower than expected. The 2010 population remains below the 1970 peak of 507,000 and is only marginally above the 1950 figure (457,000). However, in 1950, the density of the city was substantially higher, contained in a land area of 81 square miles. Kansas City now covers nearly four times as much land area, at 314 square miles. A large portion of Kansas City is actually rural and thus outside the urban area (See 2000 urban area map). This open land provides the city of Kansas City with greenfield land for new suburban development. The suburban development within Kansas City, however, has been substantially less than in other suburban areas of the metropolitan area.

Kansas City, Kansas, which was also developed around a pre-World War II core, had a population decline from 147,000 to 146,000.

The continuing dispersion of the Kansas City metropolitan area is indicated by the employment trends from 2001 to 2010 (June). Employment was down 22,000 in the metropolitan area. However, employment was down 42,000 in Jackson County, which includes the urban core of the region (the non-suburban portion of Kansas City). All employment growth has been in the suburbs (20,000).

Population data from the 2010 Census has been made available for Richmond and Virginia Beach- Norfolk. In both cases, the bulk of the population growth is in the suburbs.

Virginia Beach-Norfolk: The Virginia Beach-Norfolk metropolitan area grew from 1,576,000 in 2000 to 1,672,000 in 2010, a gain of 6.0 percent, which is a decline from 8.8 percent in the 1990s. The municipal core municipality of Norfolk gained from 234,000 to 243,000, an increase of 3.6 percent.

Suburban growth was 6.5 percent and the suburbs accounted for 91 percent of the population growth. The suburbs include Virginia Beach, which is largely a post-World War II suburban municipality. The metropolitan area is principally named for Virginia Beach because it is the largest municipality.

Richmond: The Richmond metropolitan area grew from 1,097,000 in 2000 to 1,258,000 in 2010, a gain of 14.7 percent. The historical core municipality of Richmond grew from 198,000 to 204,000, for an increase of 3.2 percent. Richmond remains below its population peak of 249,000, reached in 1970. In both the 2010 and 1970 censuses, Richmond’s land area was 60 square miles. In 1950, the population (237,000) was higher than in 2010, despite a land area of only 37 square miles.

The suburbs added 17.2 percent to their population and accounted for 96 percent of the metropolitan area growth.

The 2010 census data, just released, shows a strong trend toward dispersal in Delaware. The state’s largest county, New Castle, added eight percent to its population, rising from 500,000 to 538,000. All of that gain in the county was outside the city of Wilmington, which lost three percent of its population (from 73,000 to 71,000). Wilmington and New Castle County is a former metropolitan area that has been engulfed by the growth of the larger Philadelphia metropolitan area. Philadelphia has spread from its Pennsylvania base, with a large share of the metropolitan area now in New Jersey, along with New Castle County in Delaware and Cecil County in Maryland.

Delaware’s other two counties, both to the south of New Castle County, are growing rapidly as the population moves outside metropolitan areas. Kent County, with the state capital in Dover, gained 28 percent from 127,000 to 162,000. Southern most Sussex County added 26 percent to its population, rising from 157,000 to 197,000. Thus, much smaller Sussex County added more people than New Castle County, which began the decade of the 2000s with three times the population.

New 2010 Census results indicate that the Raleigh metropolitan area (Raleigh-Cary) grew 42 percent from 2000 to 2010. This growth rate is projected to be the highest of any metropolitan area in the nation for the 2000 to 2010 period.

The historical core municipality of Raleigh grew strongly, from 288,000 to 404,000, a gain of 40 percent. This gain was aided by annexations that added nearly 30 percent to the area of the municipality (from 113 to 143 square miles). The annexations of recent decades have left the city of Raleigh with an overwhelmingly suburban urban form. In 1950, at the beginning of the post-World War II suburban boom, the city of Raleigh had a population of 66,000, living in a land area of only 11 square miles.

The suburbs (area outside the city of Raleigh) gained nearly two-thirds of the metropolitan area growth (65 percent) and now have 64 percent of the population. Over the last ten years, the suburbs have grown 43 percent.

The core urban area of Raleigh was one of the least densely populated in a major metropolitan areas in 2000, with under 1,700 persons per square mile, at slightly less than Charlotte, Nashville and Atlanta.

Smaller satellite cities throughout the Midwest may have an advantage that they have yet to realize: strong bases for telecommuters. Cities such as Iowa City, IA; Albert Lea, MN; and Hastings, NE have this advantage, where over four percent of the city’s population works from home according to American Community Survey’s information from 2009. The average rates for larger metros tended to be in the mid 3% range. Here are a few Midwestern cities that were of note:

These cities have similar attributes: relatively small populations, mostly remote locations, and within 200 miles of a large metro. These characteristics may be a foundation for increased telecommunication in these cities. Could these cities one day become far-flung constituents of a larger conurbation?

For example, of the eight cities cited above, three of them could call Chicago their focal city. Other cities that act as cardinal municipalities in this list are Madison, Minneapolis, and Omaha. While millions from the labor force pile into large, over-populated metros throughout the Midwest for work, others may be able to find integral employment in these smaller regions, while still in close enough proximity to benefit from the larger markets.

Telecommuting may also have a positive affect on the quality of life of the individuals who take advantage of the opportunity. A smaller city often makes for lower costs, cheaper housing, less time driving from place to place, and more access to the community. On top of this, rising oil prices have less affect on the telecommuter. Furthermore, some of the cities listed are in an optimal location for natural amenities of the region to be factored in. For instance, Brainerd’s prime location amidst a plethora of lakes and forestry helps to add to the city’s natural lure, while remaining twice daily flight or a 130 mile drive to downtown Minneapolis. 

If these satellite cities can adapt to be friendly to telecommuters, they may be able to help strengthen the regional economies with a more specialized, more productive workforce. Businesses in the area must be inclined to initiate telecommuting as a part of their workforce and have trust in their workers. A smaller community may make this an opportune place for this, as it forms a more cohesive social unity amongst citizens.

If these smaller places can maintain reasonable air and telecommunications access, affordable housing, high-end schools and child care, and perhaps flexible small office space or business assistance for lone eagle entrepreneurs, these places could become hubs for this growing segment of workers.  However, the big incentive for those desiring and learning about telecommuting work may simply be the opportunity to do important work in their pajamas.

New data shows that the downtown areas of both Chicago and Portland (Oregon) are modestly dispersing and losing market share in relation to metropolitan area employment.

Chicago: The Chicago Loop Alliance reports that private sector employment in the Loop, the core of the Chicago downtown area, fell from 338,000 to 275,000 between 2000 and 2010. An additional 30,000 government workers are employed in the Loop, however 2000 data was not provided for the government sector. As a result of the loss, the Loop private sector share of total Chicago metropolitan area employment fell 13 percent, from 7.7 percent in 2000 to 6.7 percent in 2010.

The larger downtown area, including areas to the north (North Michigan Avenue area) and to the south had total private sector employment of 480,000. Chicago had the second largest downtown (central business district) in the nation in 2000, with an employment density of more than 160,000 per square mile and a transit work trip market share of 55 percent, trailing only the Manhattan business district (south of 59 Street) and the Brooklyn central business district).

Portland: The Portland Business Alliance reported that downtown Portland employment had fallen from 86,800 in 2001 to 83,400 in 2009. This represents a four percent market share loss in comparison to the metropolitan area over the period. All of Portland’s growth over the period has been in suburban Clark and Skamania counties in Washington, which added 12,700 jobs, while the Oregon portion of the metropolitan area was losing 4,500 jobs.

In 2000, Portland had the nation’s 22nd largest central business district, and the 12th highest transit work trip market share, at 30 percent (Brooklyn included).

Isn't it curious that an Administration devoted to the principle of multi-modalism is so obsessively determined to promote a single mode of its own preference -- that of high-speed rail? All three governors who rejected the federal HSR grants --- Govs. Walker, Kasich and Scott --- told Sec. LaHood that their states could badly use that money for more urgent needs of fixing roads, bridges and transit systems and, in the case of Gov. Scott, rebuilding Florida's ports in anticipation of the Panama Canal expansion.

Yet Sec. LaHood turned a deaf ear to those requests, insisting that the stimulus money must be spent on high-speed rail --- even though money spent on other modes could have been just as effective in creating jobs. After justly condemning "stove pipe" mentality and modal biases in federal decision making it is ironic to find the Administration ignoring its own principles of modal neutrality in such a blatant manner.

Census data released in the last week indicates confirms the continuing dispersion of population away from the historical core municipalities (central cities) to the suburbs in the 2000 to 2010 decade. The new figures, for Las Vegas, Birmingham and Salt Lake City indicate that a majority of growth occurred in the suburbs in each metropolitan area and that the dispersion of population to the suburbs was greater in the 2000s in each case than in the 1990s.

Las Vegas: The Las Vegas metropolitan area continued to grow strongly, adding 41 percent to its population between 2000 and 2010. This, however, represents a more than halving of the growth rate from the 1990s (86 percent). The metropolitan area population in 2010 was 1,951,000, up from 1,376,000 in 2000.

The core municipality of Las Vegas of grew 22 percent between 2000 and 2010 (from 478,000 to 584,000). The core city of Las Vegas has an overwhelming suburban urban form, having experienced virtually all of its growth in the modern, car oriented era of suburbanization. During the 2000s, the land area of Las Vegas was expanded from 113 square miles to 131.

The suburbs grew 52 percent between 2000 and 2010. The suburbs attracted 82 percent of the metropolitan population growth, up from 65 percent in the 1990s. The suburbs now account for 70 percent of the Las Vegas metropolitan area population.

Birmingham: The Birmingham metropolitan area experienced a decline in growth rate from 10 percent in the 1990s to seven percent in the 2000s. The population increased from 1,052,000 to 1,128,000.

The historical core municipality of Birmingham declined eight percent, from 243,000 to 212,000. This loss of 13 percent is the largest yet recorded for a historical core municipality in a major metropolitan area. Birmingham’s population peaked at 341,000 in 1960. This loss of more than one-third in population between 1960 and 2010 is despite annexations that doubled the size of the city (from 75 to 150 square miles).

The suburbs gained 13 percent between 2000 and 2010 and captured 140 percent of the metropolitan area’s growth (up from 124 percent in the 1990s). The suburbs now account for 81 percent of the metropolitan population.

Salt Lake City: In the Salt Lake City metropolitan area growth declined to 16 percent in the 2000s from 26 percent in the 1990s. The population rose from 969,000 to 1,124,000.

The historical core municipality of Salt Lake City grew three percent (from 182,000 to 186,000). Salt Lake City reached its population peak at 189,000 in 1960. This modest loss occurred while the land area of the city nearly doubled (from 56 square miles to 109).

The suburbs gained 19 percent between 2000 and 2010. The suburbs attracted 97 percent of the metropolitan population growth, which is up from 89 percent in the 1990s.