Closing Your City’s Small Business Data Gap

Written by Austin Nijhuis

For over 20 years, the MBTA’s Fairmount Line cut through the low-income Boston neighborhoods of Dorchester and Mattapan without stopping. However, this changed in the past year when the MBTA reconfigured the 9-mile line to operate more like a rapid-transit system rather than a commuter line. Three new stations opened, two were upgraded, and another is planned to open in the near future. In total, the Commonwealth of Massachusetts, the City of Boston, and federal agencies invested nearly $200 million in infrastructure improvements, affordable housing, commercial development, and new green space.

Local and federal organizations believe that the reconfiguration of the Fairmount Line will spur transit-oriented development, revitalize adjacent communities, allow people to live closer to their jobs, save households time and money, and reduce pollution. The Fairmount/Indigo Line Coalition, a group of local community development corporations (CDCs) along the Fairmount Line, reports that Dorchester and Mattapan, as well as Hyde Park, will benefit from over 1,500 new and preserved housing units, 780,000 square feet of new commercial space, 1,300 new jobs, and a 9-mile green corridor that will include playgrounds, orchards, parks, a pedestrian and bicycle path, and community gardens.

The challenge now will be measuring the total impact of improved public transit for the local economy, businesses, and residents. To accomplish this, it is critical to continually collect meaningful data on these neighborhoods. Demographic data is relatively easy to obtain through the U.S. Census Bureau’s American Community Survey (ACS). For instance, we know that the Fairmount Line will improve transit access to over 40,000 people within a half-mile walk of the new stations, with the majority of these residents being African American or Hispanic. Approximately 50% of area households earn less than $40,000 per year, which is about $12,000 less than the median household income for the City of Boston. Forty percent of these residents do not own a car and rely on public transportation to get to work. Through continuously collected ACS data and MBTA ridership data, we can get a detailed picture of how neighborhood demographic and public transportation ridership patterns change through time.

In contrast, collecting data on businesses is not as straightforward. Current methods include gathering information from a number of public and commercially-available sources; however, significant data gaps may exist in these databases for inner city and other low income neighborhoods. In a recent study, ICIC partnered with the Dukakis Center at Northeastern University to undertake a comprehensive initiative to identify all businesses in the inner city of Boston and along the Fairmount Line. Part of our study included comparing businesses in a leading commercial database to information collected through a walking inventory of businesses. The study area spanned over 14 miles with a focus on commercial districts along the Fairmount Line. Business data collection was carried out in December 2012, before the new stations opened.

We visually checked nearly 1,600 businesses and found startling inconsistencies between the commercial database and the walking inventory. Only 65% of businesses were visually confirmed through the walking inventory, 30% were not found, and the remaining 5% were duplicate entries or had incorrect addresses. In addition, we discovered 380 additional new businesses that were not included in the database. Our study confirmed that is difficult to obtain accurate business-level data, especially in inner cities, using public and commercial data sources. To overcome these challenges, we created a roadmap to identify local business information gaps and collect better business data that is outlined in our new Driving Urban Economic Growth Series, “A Roadmap for Inner City Business Data Collection.”

In addition to the roadmap, we were able to take a snapshot of local businesses to serve as a baseline for measuring the business and economic impact of the Fairmount Line expansion. Since periodic walking inventories are labor intensive and inefficient, we encourage community stakeholders—residents, businesses, CDCs, and government agencies—to collaborate, innovate, and improve business data collection techniques. When you consider the amount invested in communities through the Fairmount Line expansion, accurate business data collection should be a priority of stakeholders to determine the total impact of transit-oriented development in Boston and all cities.