A Regional Perspective

David Rusk
Former mayor of Albuquerque, author of Cities Without Suburbs, Baltimore Unbound

Respondents:
Roderick Mitchell, Bedford-Stuyvesant Restoration Corp.
Sandra Newman, Institute for Policy Studies
Ed Washington, Metro Portland
Phil Wichern, Visiting Scholar, Center for Urban and Regional Affairs

Moderator:
Ron Krietemeyer, Catholic Charities

David Rusk

Linking the "outside game" (regional development strategies) to the "inside game" (internal/urban development strategies) is crucial in addressing the prevalence of segregation among poor communities of color and the disparities that exist between city and suburban communities. The intersection of race and poverty is critical. If we didn't have a race problem, we wouldn't have an urban problem. In many ways, the poverty problem is a race problem. There are 11 million poor whites in the nation and 7 million poor blacks, but the problem of poverty affects these communities differently. Only 7 percent of whites are poor, while 20 percent of Latinos and 28 percent of African Americans are.

White poverty is an individual household problem. Because it is concentrated by racial segregation, poverty for people of color is a neighborhood problem. As the attributes of poverty are interrelated and exacerbate the poverty cycle, critical mass makes the resulting problems more difficult to address. Nationwide, 23 percent of poor whites live in poor neighborhoods. Three-quarters of African Americans live in neighborhoods with poverty rates of 20 percent or more. Three-quarters of all poor whites live in middle-class neighborhoods, with their benefits and opportunity structures. In the Twin Cities, 68 percent of African Americans live in neighborhoods in which 20 percent or more of the residents are in poverty.

Suburbanization increases the level of segregation by income, because housing developers build for a narrow income range within any given development. Sprawling, low-density development increases the costs of infrastructure. The prevalence of sprawl (development of land in excess of increases in population) has resulted in abandonment of the central cities and, to a lesser extent, the older suburbs. From 1960 to 1990, the rate of population growth in urbanized areas was 47 percent, while their rate of increase of land use was 107 percent. This sprawl is pulling people out of the cities, as seen in the parallel loss of population in the central cities nationwide of 30-45 percent. In Detroit, there has been a 4 percent growth in population, a 53 percent increase in land use, and a 45 percent loss of population in the center city. Portland, Oregon experienced an 80 percent increase in population, and a 104 percent increase in land-use until the last decade, during which time their urban growth boundary took hold, and helped the center city population grow by 15 percent. It is a clear example of how these development patterns affect the abandonment of the center cities. In the Twin Cities there has been a 51 percent increase in the metropolitan area's population, an 89 percent increase in land consumption, and a 23 percent loss of central city population (with a lower percentage of households lost, as family sizes decreased).

In the twenty-four cities in which they have been implemented, place-based economic development strategies have not closed the income gap for poor communities of color. If CDCs measure their effectiveness in terms of their ability to help neighborhoods escape poverty, their work has been unsuccessful. Not one of the central cities has ever closed the gap between themselves and the suburbs. Sprawl has overwhelmed their efforts.

To promote residential choice, integration, and effective urban development, cities must be able to annex suburbs to preserve their market share. In two-thirds of the rest of the country, elastic cities incorporate their expanding boundaries, capturing the growth of population and income. Not one city which has exercised annexation by at least 10 percent has less than an A bond rating. In contrast, all poorly bond-rated cities are growth-constrained. Although growth-constrained, Minneapolis has a triple A bond rating, and St. Paul, a double A bond rating, because of strong regional revenue-sharing programs. Annexed cities are characterized by less economic segregation even on a neighborhood by neighborhood basis. In growth-constrained cities such as Minneapolis and St. Paul, society sorts itself out regionally by income group and by race, though this problem has been modified here somewhat by the presence of the Metropolitan Council.

The Twin Cites metro area also has an excess of subnational governance, with 175 municipalities and 70 school systems. This excess is true of all the states of the Ohio Territories laid out into New England style townships, five or six miles to the side, by the Congress of 1787. Compared with one unit of general government for every 13,000 people throughout the county-wide governing states of the South and West, people of the Ohio Territories support one unit of governance for every 3500 people.

Short of reexamining and addressing this dubious governmental inheritance, what are some viable strategies for reaping the benefits of annexation for growth-constrained cities?

(1) Growth-management policy to reduce sprawl and its pull-out effects, and regional land-use planning, such as Portland's (including state-wide requirements, not only metro-wide; and election of planning representatives, which increases discussion and accountability)

(2) Regional revenue sharing

(3) Mandatory mixed-income housing (An example is Montgomery County Maryland, with 800,000 people, and no municipal governments of consequence. In 1973 they mandated 85 percent market rate housing, 10 percent affordable housing, 5 percent standard housing owned by the county public housing authority. The public housing authority pays fees to over 150 private homeowner associations.)

These three things will never happen unless the state mandates them. The battle for regional growth strategies should be fought in the state legislatures. The first step in this process is to develop a basis for state action. There are shared concerns between the cities, suburbs, and lower tax-base exurban areas that form the basis for coalitions.

Roderick Mitchell

Any strategy for creating healthy communities should have both local and regional components. Local strategies are not destined to fail. Community development efforts are important in the building of entrepreneurship and community resources in African-American communities. Regionalism is a strategic alliance. A real alliance has to be between equals. Otherwise our communities are subject to top-down administrative decisions, such as the "projects" of the sixties, or the siting of homeless shelters in the nineties. The effectiveness of local economic development entities cannot be evaluated according to indicators such as whether a given community has escaped poverty. Their effectiveness should be evaluated in accordance with key statistics related to an internal strategic plan. The percentage of people in poverty is a poor indicator, because in the twenty-nine years since the Bedford-Stuyvesant Restoration Corporation has been in existence, local policy has continually funneled New York City's poorest citizens into the neighborhood.

Bedford-Stuyvesant Restoration Corporation's efforts over the past twenty-nine years are addressing the effects of oppression over a three hundred year period. Our efforts are continually countered by the policies of the dominant economic and political structure. When suburban development required more highways, people were displaced and relocated to the "homelands," Bed-Stuy and Harlem. In 1970, eighty four population tracts had 30-40 percent poverty levels. Now those tracts record 60-70 percent poverty. That is not because the BSRC is doing a bad job. It does, however, make our job harder to do. Decisions about whether or not to make investments in the CDC's activities are based in part on the demographics of the community. If an investor sees that 35 percent of the community's residents receive 90 percent of their income in transfer payments, that 65 percent are renters, as opposed to owners, that the fastest growing housing sector is homeless shelters, that investment will not happen. It's not racism that causes potential partners to back away from such a profile. The racism occurs at a much higher level, at the planning and policy level. Do I then rely on these same planners and politicians to form a regional alliance in my best interest?

A prerequisite for creating healthy communities in the inner city must be the development of an economic base there. People in the community have to own the homes and the businesses. Government transfer payments can only be a stimulus or a safety net. Local business ownership is the key. That's where I radically depart from Mr. Rusk's plan of government-forced integration. Integration into what?

Sandra Newman

If, as Mr. Rusk contends, concentration is the problem, then deconcentration can be the only solution. Mr. Rusk contends that metropolitan deconcentration can be achieved by creating cities without suburbs. According to him, deconcentration is in the best interest of the suburbs because suburbs will sink or swim with their urban communities. Underlying his argument are these central questions: (1) How important are cities to their regional economies? (2) Is segregation part of the problem, and therefore integration part of the solution? What do we know about the effects of school and housing desegregation?

(1) How important are cities to their regional economies? The current literature does not definitively answer that question. It does identify four sources of interdependence between cities and suburbs. a. The image of the region is affected by the image of the city. b. The city's amenities are of value. c. Fiscal problems of cities might increase the suburbs' tax burden. d. Increased coordination between cities and suburbs may provide unique agglomeration economies that cannot be achieved elsewhere through the region.

There is a dearth of research concerning questions a and b. Looking at c, we find that taxes are a determinant of economic growth. The location of firms is discouraged by high taxes in the central city. This is particularly true if the higher taxes are being used for welfare expenditures. It is in the best interest of cities and outlying suburbs to act jointly to minimize the differences in tax rates. d. The research has relied on correlations between central cities and suburbs. Correlations can be misleading. Income growth of a city does correlate with suburban income growth. Positive correlations can result from common outside forces, but there is support for the idea that agglomeration effects occur when cities and suburbs coordinate their activities.

(2) a. What do we know about school desegregation? There are two important flaws in the research on this question. The current discussion and the existing literature focus on middle and high school students, but the first few grades are more predictive and significant. The discussion also fails to distinguish between summer and the school year. They should be separated because gains made during the school year are sometimes lost during the summer. One study suggests that the achievements of black children who attend integrated schools but live in segregated communities are not superior to children who attend segregated schools. Researchers have attributed this to sociological issues: spoken language skills do not match what the students hear when they are being taught. In math, African-American students achieve more in integrated schools than in segregated ones. This study found that parental background is an important predictor of educational achievement.

b. What do we know about residential desegregation? Mr. Rusk argues that regional growth strategies will reduce income segregation, which is highly correlated with racial segregation in housing markets. Housing and mortgage market discrimination are significant contributors to the problem of segregation in housing markets. The preferences of blacks and whites, however, are also significant factors. Ren Farley found that in making a determination about what neighborhood to move into, blacks prefer one-half to two-thirds of the residents to be black. There has been a 7 percent decline in the percentage of blacks who would be willing to be the first to integrate an all-white neighborhood. The truth is that we don't know what would happen if there were increased access to suburban neighborhoods. Whites might choose to move out. Blacks might choose to live with other blacks, regardless of changes in suburban housing markets. Academics and policy makers should understand that the outcome of a strategy which maximizes choice may not be significant integration.

c. Do characteristics of neighborhoods influence outcomes (behavior, educational attainment, labor force participation)? Deconcentration research by Rosenbaum shows significant positive effects, but contrasts with twenty-five studies that look at the effects of neighborhoods on educational achievement. Family background (especially parental income, education, and employment) has been found to be more predictive than neighborhood effects, though there are small neighborhood effects. Living among affluent families has the greatest effect. The presence of middle-class households of color is a strong predictor of better outcomes for low-income children of color (particularly African-American males, for whom white middle-class presence is not).

The answers, then, to the questions underlying Mr. Rusk's arguments: It is likely that city-suburb links do exist, but it is problematic. Both discrimination and preferences play roles in housing segregation. Policies to increase low-income housing must be accompanied by anti-discriminatory policies if they are to further a goal of integration. School education in early grades benefits African-American students in math, but not English. Family background is highly significant. Direct intervention to increase education, employment, and skills may be more important than deconcentration of poverty or racial integration. Whether there are important synergies between these two strategies remains an open question.

Ed Washington

I'm a regionalist, an African American, and an optimist. When I visit the Northeast and some other parts of the country, and explain that we do not suffer the problems of abandonment and sprawl that they do, I'm accused of being from utopia. There are difficulties. I'm the only African American elected official in the Portland area. We have, however, a system of elected metropolitan governance that is well suited to constructive dialogue about healthy communities. I don't always agree with Robert Liberty and the 1000 Friends of Oregon, but they bring helpful information to the table, and we often agree to disagree in working for the best for the region. We also have an urban growth boundary that I am committed to maintaining until we have in-filled, developed, and redeveloped every bit of that land. To those who would say that building on the fringes of what currently exists is the only way to guarantee that property values will increase, I would point out that the values of homes in Portland have risen 302 percent in the past five years.

My job is as a policy maker in a regional government whose primary responsibility is planning for an area into which 700,000 people are expected to move in the next thirty years. We could throw open the region to sprawl and abandonment, but we have found a better way. My hope is that we can also show leadership in our thinking about race and poverty, which has traditionally been a black and white issue. Asians and Latinos are larger segments of the population of Oregon than African Americans now, and we need to understand the issues around them, as well.

Phil Wichern

A "can do" attitude is important. A positive attitude can accomplish more than academic cynicism. We need to remember the difference between statistical realities and reality itself. I hope we can bridge the gap between academia and real life. To do this we must first remember that all of the people we discuss are persons, and also avoid a tendency to reduce a rainbow of ethnicities to black and white. You can call me a non-Hispanic white, and that's a label; but just yesterday, I was walking around noticing the incredible differences among individuals.

Preferences were mentioned. I think we have to keep those in mind. However, I think we need to continue to expand the attack on discrimination and racism not only in the housing area, but as I was reminded just last night, in the corporations in the suburbs that have de facto preferences or policies in their hiring practices. We need to keep in mind the connection between jobs and housing, and how we can match those, and how much we want to force housing choices by employment availability.

Intellectual realities and practical realities come together in my field, the art and science of metropolitan governing. My recommendation is that we first make a guarantee that we will have safe, healthy living environments throughout the metro area, and then focus on areas where such conditions do not exist. We need to make a contract that holds our elected officials to at least minimal requirements for good environments throughout the metropolitan area.

The regional government of Winnipeg shows us that this commitment is more important that the form of government. A well-meaning plan for regional government there fell prey to the use by wealthier suburban communities of regional public funds for local amenities such as swimming pools. They also discovered that affordable housing in the suburbs is not enough: we need transportation, jobs, and quality of life support, especially in harsher climates. Another problem they encountered was people jumping the regional boundaries in an attempt to separate themselves from the regional tax burdens. So regional government in itself is not a panacea. We need to strengthen the things we're doing right, such as tax-revenue sharing. Working together is very important, but there's no magic bullet, and it's certainly not simply amalgamation.