Smart Growth and Community Development: The Necessary Connection

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Smart Growth and Community Development The
Necessary Connection
Center on Urban and Metropolitan PolicyBruce
Katz, Director
Presentation to the Federal Reserve Bank November
28, 2001
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Major Questions

• What are the general trends affecting
  metropolitan areas?
• What is the emerging smart growth agenda?
• What does this mean for smart growth and
  community development?

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I. What are the general trends affecting
metropolitan areas?
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1. Metropolitan areas are decentralizing
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Population Is Decentralizing
Suburbs grew faster than cities during the 1990s
Source U.S. Census Bureau
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Population Is Decentralizing
This trend was obvious in both expanding and
contracting metropolitan areas 1
1 1990-2000
Source U.S. Census Bureau
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Population Is Decentralizing
Counties outside of Baltimore grew rapidly during
the 1990s the city lost a substantial number of
residents 1
1 1990-2000
Source U.S. Census Bureau
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Population Is Decentralizing
The Baltimore and Washington regions are
De-Densifying
Source Fulton et al., Who Sprawls Most? How
Growth Patterns Differ Across the U.S.
Brookings Institution, July 2001.
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Employment Is Decentralizing
Most cities gained jobs, but suburbs invariably
gained more
1 Based on changes between 1992 and 1997
Source U.S Department of Housing and Urban
Development, State of the Cities 2000. ..
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Employment Is Decentralizing
Jobs are also de-densifying a large share of
employment is located further than 10 miles from
the central business district
Source Edward Glaeser. Job Sprawl Employment
Location in U.S. Metropolitan Areas. Brookings,
May 2001.
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2. Decentralization Is Costly
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Decentralization Is Costly
Decentralization leaves behind concentrated
poverty in inner cities. The city of Baltimores
share of the state welfare caseload increased
significantly between 1994 and 1999
Source Katherine Allen and Maria Kirby.
Unfinished Business Why Cities Matter to
Welfare Reform. Brookings, July 2000.
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Decentralization Is Costly
Washington, D.C. is experiencing a growing income
divide
1990
2000
1990 Dollars High Income gt125,000 Low
lt15,000
Middle Income
High Income
Low Income
Source Washington Post
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Decentralization Is Costly
Affordable housing is concentrated in declining
areas
Metropolitan Atlanta (Low income housing is
concentrated in the south)
Source Moving Beyond Sprawl, Brookings
Institution, 2000
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Older suburbs are beginning to take on many of
the challenges of central cities.
Decentralization Is Costly

• Increasing school poverty
• Growing racial and ethnic diversity
• Declining fiscal capacity.
• Declining commercial corridors and retail malls

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Decentralization Is Costly
Older suburbs are home to the working poor.
Recipients of the EITC are concentrated in
Washington and its eastern suburbs
Source IRS, E-File Demographics.
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Decentralization Is Costly
Decentralization has exacerbated racial division
in metropolitan areas like Washington, D.C.
Metropolitan Washington (Non-white students are
concentrated in the east)
Source A Region Divided, Brookings Institution,
1999
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Decentralization Is Costly
Decentralization has had many negative
consequences for newer suburban areas

• Loss of open space
• Overcrowded schools

• Traffic congestion
• Air pollution

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II. What is the emerging smart growth agenda?
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Smart growth involves efforts to change the
governmental rules of the development game that
facilitate sprawl and concentrate poverty.
Smart growth efforts are designed to slow
decentralization, promote urban reinvestment, and
enhance access to opportunity.
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The New Metropolitan Agenda
2. LAND USE REFORM
3. INFRASTRUCTURE
1. REGIONAL GOVERNANCE
4. TAXATION
5. ACCESS TO OPPORTUNITY
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Smart Growth Reforms State Examples
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Regional Governance
Georgia Regional Transportation Authority (1999)

• Combats air pollution, traffic congestion and
  sprawl development
• Mandates approval for major highway and
  development projects that affect the metro
  Atlanta region
• Requires local governments to cooperate with GRTA
  or face loss of state and federal funds for
  road-building

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Land Use Reform Preservation
Issue 1 - Clean Ohio Fund (2000)

• Voters authorized 200 million in general
  obligation bonds for the conservation and
  preservation of natural areas, open space, and
  farmlands
• 200 million in revenue bonds to remediate urban
  brownfields and promote economic development

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Land Use Reform Growth Management
Pennsylvania Growing Smarter Law (2000)

• Clarifies authority of counties and
  municipalities to create Locally Designated
  Growth Areas
• Encourages transfer of development rights from
  open space to planned growth areas
• Facilitates regional planning
• Gives local governments greater ability to
  withstand legal challenges while planning growth

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Infrastructure
Maryland Smart Growth and Neighborhood
Conservation Act of 1997

• Targets major state funding (e.g. transportation,
  housing, state facilities) to Priority Funding
  Areas
• Priority Funding Areas include municipalities,
  inner beltway areas, enterprise zones, industrial
  areas and new planned growth areas

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Taxation
Minnesota Fiscal Disparities Law

• Allocates 40 of the growth in property tax
  revenues from commercial industrial development
  to a metropolitan tax base pool
• Funds in the pool are redistributed to
  communities based on their commercial tax
  capacity
• While the law has narrowed fiscal disparities,
  growing suburbs continue to have 25 to 30 percent
  more tax base per household than central cities
  and inner suburbs

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Access to Opportunity
California Tax Credit Allocation Committee

• Approximately 450 million per year is awarded in
  federal and state tax credits to assist in the
  construction and rehabilitation of affordable
  rental housing
• Priority is given to properties located within
  close proximity of transit corridors, parks,
  recreational facilities, retailers, grocery
  stores, schools and senior centers

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The New Metropolitan Agenda
2. LAND USE REFORM
3. INFRASTRUCTURE
1. REGIONAL GOVERNANCE
4. TAXATION
5. ACCESS TO OPPORTUNITY
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III. What does this mean for smart growth and
community development
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Smart Growth Community Development
Smart growth complements community development
by

• Promoting reinvestment in central cities
• Strengthening central city fiscal capacity
• Providing more affordable housing in suburbs
• Converting spatial mismatch to spatial match for
  low-income workers

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Smart Growth Community Development
Community development entities can support smart
growth by

• Advancing state and regional policy reforms
• Organizing state and regional coalitions to
  advance smart growth agenda
• Encouraging urban constituencies - particularly
  political leaders - to join state and regional
  coalitions

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Smart Growth Community Development
Community development entities can help create
communities of choice and opportunity by
advancing smart growth in their own work
CDCs should be placing emphasis on

• Building mixed income communities
• Creating wealth (as opposed to housing)
• Leveraging school, land, and other local reform
  efforts

Community development entities can also advance
the smart growth agenda by extending geographic
coverage to suburbs
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www.brookings.edu/urban