4 cities fear U.S. reduction of status
Designation loss means less funds
future of four of Arkansas’ biggest cities rests in the hands of a federal committee tasked with redefining a longstanding bureaucratic label.
It may seem like semantics, but for 144 places around the country, whether they are considered a Metropolitan Statistical Area could mean losing millions of dollars in federal funds or investment from businesses.
Of the 144 places in the United States that could lose their status as MSAs, four are in Arkansas — Jonesboro, Hot Springs, Pine Bluff and Texarkana — and leaders from those cities are objecting to the proposed downgrade in their status.
“This is one of those things that, sort of, the doctrine of unintended consequences would seem to play out,” said Mark Hayes, executive director of the Arkansas Municipal League.
For officials at the Office of Management and Budget who are proposing the change, the new designation is about more accurate statistics and labels for cities around the country. But local officials argue losing designation as a MSA could have a devastating effect on their communities.
Currently, to be dubbed a Metropolitan Statistical Area the city anchoring the metro area needs to have a population of at least 50,000 people. Under the proposed change, that requirement would double to 100,000 people.
It’s that proposed change that means Jonesboro, Hot Springs, Pine Bluff and Texarkana — all with populations well less than 100,000 people — could lose their status as MSAs, and their ability to apply for some key federal grants.
Those grants often go toward updating and maintaining roads, bridges, airports and houses, filling in significant chunks of city budgets.
Allison Thompson, president and CEO of the Economic Development Alliance for Jefferson County, said those federal transportation dollars are critical to Pine Bluff’s future growth.
“We don’t need to lessen the impact and the voice of our smaller, more rural areas,” Thompson said. “We need to, you know, at minimum keep it the same or increase it.”
For many, losing an MSA designation also would mean a loss in private-sector dollars as well because businesses looking to relocate or expand often want to do so in MSAs.
“There’s a lot of businesses and industries that when they are making their decisions on whether they want to locate in an area, you know, an MSA is one of the boxes that they check in their selection criteria,” Craighead County Judge Marvin Day said. “So we wouldn’t — potentially — wouldn’t even get on the radar for some people that might be a good fit for them to be in our business community.”
Hot Springs Mayor Pat McCabe echoed that concern, saying the city needed its MSA designation to attract businesses.
“We are all competing for industry and companies to relocate to our communities, and many times they will have certain criteria that need to be met, and one of them is to be an MSA,” McCabe said. “And if Hot Springs isn’t listed, that puts us at a competitive disadvantage.”
Losing an MSA designation wouldn’t be felt right away, especially in places like Hot Springs, which has a vibrant tourism industry, and Jonesboro, which has a large state university anchoring its growth, local leaders said. But the loss of MSA status could still hurt.
“Jonesboro has had great growth over the last several decades,” said Mark Young, president and CEO of the Jonesboro Regional Chamber of Commerce. “We want that to continue. This will impede that. I don’t think it will stop it.”
The proposed change isn’t meant to take away advantages from small and medium-sized cites, but rather provide a more accurate description for the federal government.
The MSA designation was created about 70 years ago to delineate key population centers around the United States. Since then, the population of the country has swelled to more than 330 million people, more than double what it was in 1950, meaning what does and doesn’t count as an MSA may need to be updated.
“In reviewing the 2010 standards, the committee noted that the minimum population required for an urban area to qualify a metropolitan statistical area had not kept pace with population growth of the United States,” according to a report from a federal committee reviewing the matter. “They observed that the population of the United States had more than doubled since the 1950 census.”
The change, which was proposed by Office of Management and Budget in January, is up for review with the federal government seeking comment on the suggested changes.
Rep. Bruce Westerman represents Hot Springs, Texarkana and Pine Bluff — three of the four Arkansas MSAs that could get axed in the change — and signed a letter addressed to the Office of Management and Budget asking them to reconsider the change, saying opposition to it was “a bipartisan issue.”
“Our government should support vibrant, economic hubs such as Jonesboro, Texarkana, Hot Springs and Pine Bluff, not arbitrarily change the rules on these communities after 70 years,” Westerman said in a statement.