The case for a mega-region combining the Richmond area and Hampton Roads

To compete in a global economy, Richmond and Hampton Roads would do better as a combined mega-region, a prominent Virginia lawyer says.   As individual metropolitan statistical areas (MSAs), Hampton Roads now ranks 39th and the Richmond region is 44th.

“Together we would be the 16th largest MSA in the country with nearly 3 million people,” Tom Frantz, chairman of the board of Williams Mullen, said Tuesday during an appearance before the Greater Richmond Association for Commercial Real Estate.

Frantz , a Virginia Beach resident, has been spearheading a mega-region initiative for several years. His talk drew about 140 people to the Country Club of Virginia.

If the two regions aligned into what is known as a combined statistical area (CSA), the designation would reap economic benefits, Frantz says. “This would be better strategically than where we are today,” he said, with Virginia seeing flat economic development growth in 2014.

Hampton Roads’ strong defense sector has suffered as a result of budget cuts under sequestration, while Richmond has lost some of its signature employers in recent years.

A mega-region designation would make the Richmond and Hampton Roads regions, separated by about 50 miles, more competitive in several areas, Frantz says. For instance, he says, the combined region would better qualify for federal grants for transportation infrastructure, corporate relocation sites, professional sports teams and entertainment venues, institutional investments in commercial real estate and advertising dollars from corporations and public officials.

“We’re not talking about merging cities, counties, fire departments. We’re not talking about combining governments or even merging economic development authorities,” Frantz said. “All we’re talking about is to enhance the way we hold ourselves out to the world as a combined mid-Atlantic gateway.” 

To become a CSA, a formal application has to be filed with the federal Office of Management and Budget (OMB). Frantz said the groups he works with are not to that point yet, as they need to forge a greater political consensus for the change. 

Yet, he noted, more areas elsewhere are trying this route, including Austin and San Antonia in Texas and the Tampa and Orlando areas in Florida. The OMB lists 169 CSAs at its website. Some of them, like Chattanooga-Cleveland-Dalton, which covers ground in Tennessee, Georgia and Alabama, are much larger than what Frantz is proposing.

He depicted the two regions as rich in assets, including the Port of Virginia in Hampton Roads, the fifth-largest in the country and the only one with a deep enough channel to accommodate the huge ships expected to call following the opening of a new lane at the Panama Canal in 2016.  Yet many challenges remain, he added, in terms of improving the road system to serve the port and diversifying the economy away from defense and toward industries such as biosciences, cybersecurity and advanced manufacturing.

“To be successful, the same old ways we’ve done things in Virginia will not work,” he said. “We need to think boldly, positively and figure out how we can put together our strengths and succeed in a new economy and pick up jobs. Together, we have more opportunities.”

In 2012, Frantz helped found the Hampton Roads Business Roundtable, a business advocacy group of about 32 business leaders that began working on a mega-region initiative.

The group hired lobbyists last year to tackle transportation funding for projects like the widening of Interstate 64, which is underway, and improvements to U. S. Route 460 to better move containers from the port by trucks.

Currently, Frantz said 63 percent of the port’s container traffic moves by truck, 33 percent by rail, and 4 percent by barge. 

A subsector of a Richmond group, the Management Roundtable in Richmond, is working with Frantz’s group to support the mega-region efforts.  Tayloe Negus, that group’s executive director and a partner with Aon Hewitt, noted that Virginia ranked 48th out of the 50 states in 2014 in economic growth. “We were just ahead of Alaska and Mississippi,” he said.

As a human relations consultant, Negus says he works with large companies. One of them decided that it would focus its growth efforts on the top 30 metropolitan areas in the world. “That is where the world is moving, towards these major metropolitans. If you’re not competing in that realm, you are going to fall behind,” he said.