Should developers be "customers"? Comments on the Port Authority meeting, 4/8/15

The April meeting of the Port Authority Board began with an update on the strategic planning process, during which a couple of definitions were offered for consideration by Board members:

Who are our customers?

“Real estate developers, owners, and lessees who increase our regional tax and employment base.”

Under this definition, the City and County  — “and taxpayers,” I was glad to hear a board member add — are “investors” in the Port Authority.

In contrast to City Council discussions about development projects it controls directly, there isn’t a public comment period during Port Authority meetings, so I’m taking advantage of Cincyopolis to provide some public input that I hope is helpful to the Port Authority board.

Several members of the Cincyopolis Citizen Brigade discussed the proposed guiding definitions and questioned whether marketing terminology was really the most appropriate framework for an organization that pursues development initiatives funded by taxpayer dollars.

One member commented that…

…inappropriate expansion of market terminology to other areas clouds our vision.

Market terminology isn’t a good fit for every situation — imagine, for instance, if your relationship with your spouse or life partner were defined in market terms. Who would be the “customer”? And what does that choice of terms imply about power, trust, and accountability in a relationship?

The terms we use to describe relationships are important.

The Port Authority, market terminology, and the potential for conflict.  Just as using market terms in describing personal relationships can distort communications in a way that sets up conflict, I believe that using market terms to describe relationships among stakeholders in the Port Authority’s efforts could be similarly counterproductive.

For example, what if a developer operating with Port Authority support wanted to demolish an old building in a historic district? How would the Port Authority respond to conflicting priorities of its “customers” — developers and property owners — and its “investors” — taxpayers and government officials charged with enforcing historic conservation? Such a scenario doesn’t seem so farfetched to me, given recent and proposed demolitions of historic structures despite significant public opposition:

There’s a big difference between how we describe corporate leaders and government employees, including the politicians we elect to office. Politicians and government employees are “public servants,” with direct accountability to the public that elects them. While one board member observed during the meeting that “the nice thing about this [Port Authority] board is that we don’t have to raise money,” I hope they determine a framework that defines their strategic goals and relationships with taxpayers and other stakeholders so that the “public good” that is to be the outcome of their projects can be readily recognized and agreed to by a broad public constituency.

If, in the end, the Port Authority settles on language that defines taxpayers as its  “investors,” it seems reasonable that we might expect that the organization grant taxpayers the rights that shareholders in publicly traded firms enjoy, or minimally, some version of the Statement of Investors Rights advocated by the CFA Institute, a nonprofit organization that seeks to “lead the investment profession globally by promoting the highest standards of ethics, education, and professional excellence for the ultimate benefit of society.” According to this statement, investors rights should include

  • Honest, competent, and ethical conduct that complies with applicable law.
  • Disclosure of any existing or potential conflicts of interest.
  • Clear, accurate, complete, and timely communications that use plain language and are presented in a format that conveys the information effectively.

And as taxpayers, we can all be “activist investors” like Kathy Holwadel and work together — citizens, businesses, and government — to build a great city. I hope you will consider joining the Citizen Brigade at the next Port Authority Board meeting, May 20, 8:00 a.m.

Katherine Durack

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Meetings of the Port Authority are held in a conference room at the Taft Center at Fountain Square, accessed from the Westin Hotel lobby, 425 Walnut, Second Floor.

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2 thoughts on “Should developers be "customers"? Comments on the Port Authority meeting, 4/8/15

  1. Michael Verzola

    I was surprised that the customers were the real estate developers, owners, etc. I would have guessed that the taxpayers were the customers. Sometimes, the simplest answer is the best: “who pays me?” That usually gives a strong clue to who the customer is.

    But, I may be speaking out of school here, because I don’t really know what the Port Authority’s purpose is….what their mission is, so to speak. Unless everyone is clear and aligned on that, discussions about “customers” are nothing more than noise. It does not surprise me that some of the people in the discussion didn’t feel that dealing in terms of customer wants and needs was applicable. More likely, they are not aligned on the mission and who the customers really are.

    Interesting update. Thanks, Kathy.

    Mike

    ——

    Reply
  2. patterns4success Post author

    My understanding is that the Port Authority is currently involved in a strategic planning process — I assume one result of that process will be a clearly defined mission that reflects some of their new sources of revenue. There are clues to mission in their petition to expand the boundaries of the Port Authority — which mostly has to do with promoting river commerce (which you can read about here http://www.cincinnatiport.org/transportation-logistics/ports-cincinnati-northern-kentucky/). A little about the history of the Port Authority is on their website, here http://www.cincinnatiport.org/about/history/.
    –Katherine Durack

    Reply

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