Neighborhood Investment Research Articles

Community Benefit Agreements: New Vehicle for Investment in America's Neighborhoods

Community Benefit Agreements (CBAs) are a relatively new feature of the land use planning process for major public-private developments. The CBA is a legally enforceable contract negotiated directly between the developer and a broad-based community coalition. Developers agree to provide valuable benefits to the community (e.g., park space or recreational facilities, a living wage for workers), and they receive in turn valuable support from the community for the proposed development. Both signatories to a CBA want to see the project built (otherwise, the community gets no benefits), so CBAs are not a vehicle for NIMBY-style (not in my back yard) opponents. CBAs put developers into a direct dialogue with representatives of the community most immediately impacted by their proposed project, thereby enhancing the democratic legitimacy of public-private partnership agreements that are usually negotiated between governmental officials and private developers with little or no participation by nongovernmental stakeholders. Public officials, private developers, and community organizations share a common interest in negotiating and executing CBAs. Consequently, land use lawyers need to understand how they can assist their public, private, and nonprofit clients in conducting CBA negotiations.

NEIGHBORHOOD DYNAMICS AND PRICE EFFECTS OF SUPERFUND SITE CLEAN‐UP*

ABSTRACT Numerous hedonic price analyses estimate price effects associated with hazardous waste site remediation or other environmental variation. This paper estimates a neighborhood transition model to capture the direct price effect from Superfund site clean‐up and the indirect price effects arising from residential sorting and changes in investment in the housing stock following clean‐up. First‐difference models of neighborhood change and a national sample are used. This approach fails to find consistent positive direct price effects. Positive indirect effects, however, may arise through residential sorting and neighborhood investment spurred by remediation. The findings can be sensitive to policy endogeneity and model specification.

Neighborhood Economic Development Effects of the Earned Income Tax Credit in Los Angeles

This paper explores the effect of the Earned Income Tax Credit (EITC) on poor neighborhoods of Los Angeles during the late 1990s. To date, few analyses have empirically examined the impact of people-based policies on the economies of poor neighborhoods. The paper first documents the magnitude of this individual wage subsidy in Los Angeles as an unrecognized investment in poor neighborhoods on par with place-based policies such as Enterprise Zones. The paper then uses IRS and Economic Census data by ZIP Code to test whether increased EITC income has an effect on the neighborhood retail job base. Findings suggest an independent correlation between EITC investments and retail job gain. The conclusion uses these results to suggest better policy coordination and recommend four productive areas for future research.

How to Think about Place and People Approaches to Poverty

Spatially concentrated poverty has been the subject of scholarly research and policy debates since at least the late 1980s. The frameworks for understanding these studies and debates have focused on causes related to individuals, or “people,” and neighborhoods, or “places.” This article reviews the literature on people-based and place-based policy, suggesting that the dichotomy obscures important spatial impacts of individual entitlements and the impact of place-based policies on individual residents. The study empirically examines the implementation of the Earned Income Tax Credit (EITC) in Los Angeles and compares its spatial characteristics with the public investments associated with the place-based Enterprise Zone (EZ) program. Findings show that the EITC represents a significantly greater, though unintended, investment in poor neighborhoods than does the EZ and suggest new scholarly research and policy directions.

Comments

Comment Richard Voith Richard Voith: This ambitious paper attempts to shed light on the determinants of new rail investment, the likely impacts of these investments on transit use, and their possible welfare impacts. By looking across cities, the authors can search for systematic factors that determine the relative success or failure of this type of infrastructure spending. This is significant, as there has been little serious cross-city analysis of rail transit investment. In addition, the application of a differences-in-differences approach to measuring the ridership impact of new transit supply provides insight at the microlevel of this type of investment on overall transit use. The dominant view of economists has been that rail transit investments generally have been ineffective and expensive, and the benefits do not justify the costs. Baum-Snow and Kahn present evidence that can be interpreted as supporting the dominant view. In particular, the authors argue that: 1) older cities with existing rail transit experienced large declines in transit market share in the 1970–2000 period, although there are notable exceptions; 2) investments in new rail transit have failed to stem the decline in transit market share in most cities, again with some exceptions; 3) the primary impacts of new rail transit investments are to cause transit mode shifts from bus to rail within the transit market; and 4) the primary reason that many cities have undertaken new rail investment has been because federal subsidies have significantly lowered rail investment costs to state and local governments. While the cross-city approach taken by Baum-Snow and Kahn is an interesting and useful perspective, actual public transit markets are intensely local, with specific characteristics of the transit service, markets served, and investment in alternatives ultimately determining the transit market share. This local perspective is lacking (understandably) in the Baum-Snow and Kahn approach, and I argue it leads to some excessively negative conclusions regarding rail transit investment. [End Page 198] I examine four areas that could materially affect the interpretation of the Baum-Snow and Kahn analysis: differences in alternative investment in alternative transportation (roads) across cities and neighborhoods; rail transit operating characteristics that differ significantly in quantity, quality, and scope; households, as well as household preferences and characteristics, can change over time and are affected, in part, by transportation and other public investments in neighborhoods; and the focus on market share obscures the performance of rail transit in markets where it is a viable option. Alternative Transportation Investment Baum-Snow and Kahn note that more than $25 billion has be expended on rail transit investment in the sixteen cities building new rail transit systems from 1970 through 2000. To put this in perspective, $128.5 billion was spent on highways in 2000 alone.1 Extensive investment in highways affects transit ridership in three ways. First, it often competes directly with rail transit services for delivery of people to the central business district (CBD). In Philadelphia, for example, parts of interstate highway I-95 that run through central Philadelphia were completed during the 1970s at a cost of $500 million. An additional $200 million was spent on I-676, which also runs through Center City Philadelphia. These highways competed directly with existing rail transit services in the city.2 It is not surprising, therefore, that Baum-Snow and Kahn find sharply declining market shares for transit in Philadelphia. Second, extensive highway investment lowers vehicular transportation costs, especially to locations outside of existing CBDs, which in turn encourages decentralization of employment. As noted in the Baum-Snow and Kahn analysis, employment centralization is a key factor affecting transit market share. Again in Philadelphia, significant new highway construction, notably I-476 and other improvements west of the city, shifted the relative attractiveness of employment and retail locations away from the older, more centralized city. Finally, the geographic expansion associated with new highway investment generally places additional demands on public transit resources [End Page 199] that typically lowers the average quality and quantity of transit services in high density, high ridership areas, while increasing the geographic scope of services. Since most transit providers are regional in their organization and governance, as activity shifts outward, resources are redeployed to serve...

The Church and the Revitalization of Politics and Community

One typical Sunday morning, Father Jackson, rector of a mainline African-American church, ended his sermon by making weekly announcements. After reviewing upcoming events, he asked his congregation for donations to fund scholarships for neighborhood children to participate in summer camp, noting simultaneously that federal government had cut appropriations for poor teenagers. He then called attention to an announcement in bulletin, asking members to witness for a living wage at a rally at City Hall. In this short interlude, Father Jackson simultaneously provided political information about federal government's activities, engaged in institution building in a poor neighborhood, and provided his worshipers with an opportunity to make demands on local authorities. He demonstrated that church can serve as an important political institution, generating ways to engage political process and simultaneously providing services through ministry in face of declining government investment in poor neighborhoods. Asserting importance of church in polity rests upon claims that locally-based institutions are important to connecting people to political process.1 One can imagine institutions, like churches, making these connections in two ways. First, institutional participation builds social capital, or the features of life-networks, norms and trust-that enable participants to act together more effectively to pursue shared objectives.2 These norms underlie

GEOGRAPHIC VARIATION IN MORTGAGE DISCRIMINATION: EVIDENCE FROM LOS ANGELES

This paper addresses the question of racial and ethnic discrimination and geographic redlining in Los Angeles County mortgage markets using 1990 Home Mortgage Disclosure Act data on mortgage applications and U.S. Census Bureau Summary Tape Files for tract-level sociodemographic and housing data. Logit models of the probabilty that a mortgage application will be approved show across-the-board discrimination against Black applicants but not against Hispanic applicants. Applicants in both Black and Hispanic neighborhoods, however, are systematically denied loans, even when controlling for neighborhood socioeconomic differences. Finally, the joint contingency of applicant race/ethnicity and neighborhood race/ethnic context plays a significant role in determining mortgage application outcomes: both Black and Hispanic applicants are more likely to have their applications approved when they apply in predominantly Black neighborhoods. [Key words: fair lending, redlining, neighborhood investment, discrimination, steering.]

University-Community Partnerships: A Mutually Beneficial Effort to Aid Community Development and Improve Academic Learning Opportunities

Colleges and universities should not only be accessible to students; they should be accessible to their communities as well. Colleges and universities can be constructive partners with their communities on issues such us economic development, elementary and secondary education, health and human services, investments in neighborhoods, and scholarship outreach. I discuss university–community partnerships already making contributions to the life of their communities, using examples from across Massachusetts. Universities should strengthen their involvement in community partnerships. Information about existing partnerships should be placed on Web sites to make them widely available. Universities should make their commitment firm--and then make it public.

Measuring Neighborhood Investments: An Examination of Community Choice

Community choice is a very important household decision, since it represents an investment in community attributes that can have a significant effect on the quality of life of all household members, particularly by influencing the future prospects of children. In this paper, we examine the housing and community choices of migrants to and within Los Angeles County identified in the 1990 5% public‐use sample of the Census. Controlling for income, we find that expenditures on housing structure are quite similar across races. However, controlling for income, black and Hispanic households consume significantly less in community attributes than white households.

The Effectiveness of Neighborhood Collective Action

Urban redevelopment forces have created major and complex issues for residents in neighborhoods. Faced with such threats, many neighborhoods have become proactive and have attempted to protect and improve their environment through collective organization and social action. This paper investigates the factors that contribute to the effectiveness of neighborhood organization. A theoretical model that places emphasis on the role of local ecology, organizational complexity, and coalitional embeddedness is developed. The model is tested using data collected from neighborhood associations. Greater effectiveness is associated with socioeconomic status, neighborhood investments, and environmental threats. Organizational resources and coalitional embeddedness were found to be the most important factors explaining effectiveness.

Gangs, Neighborhoods, and Public Policy

This article uses research from three recent Milwaukee studies to show that deindustrialization has altered some characteristics of youth gangs. Gang members tend to stay involved with the gang as adults, and many have turned to the illegal drug economy for survival. Poor African-Americans in neighborhoods where gangs persist have both similarities and differences to Wilson's underclass concept. What characterizes these neighborhoods is not the absence of working people but the absence of effective social institutions. Public policy ought to stress jobs and investment in underclass neighborhoods, evaluation of programs, family preservation, and community control of social institutions.

Differential Decline: The Neighborhood Context of Abandonment

AbstractExisting research explains housing abandonment In the broad context of urban decline or the narrow micro-economics of housing sub-markets. In both cases, abandonment is assumed to be a singular process across a city. In this paper, the neighborhood context of abandonment is examined with the view that abandonment varies with a neighborhood’s historical ecology. Data from the Philadelphia License and Inspection records, the U. S. Census Bureau, Pennsylvania Industrial Directories, and from financial institutions provide evidence linking abandonment to job access, racial transition, mortgage investment and population decline in neighborhoods having different historical and contemporary ecological positions in the city.

Enterprise Zones

Using criteria of efficiency, equity, and efficacy to assess enterprise zones reveals several shortcomings. The success of enterprise zones in revitalizing economically distressed areas depends on whether the causes of market failures are correctly identified, whether zone incentives are sufficient to trigger zone investment, and whether the investment and jobs produced in the zones are sufficient to offset additional service costs and lost tax revenues to participating governments. As presently formulated, however, the administration's enterprise zone proposal (March 1982) is insensitive to context-dependent local investment processes. This failure to strengthen the preconditions of neighborhood investment weakens the impact of zone incentives. The economic restructuring processes attendant to zone development raise concerns about equity and efficacy with regard to the promotion of capital-intensive development, displacement of existing businesses and organizations, assistance to small business enterprises, and articulation and representation of neighborhood interests.

Capital investment in neighborhoods: Theories which inform national urban policy in the United States

This article addresses two fundamental issues in the design and implementation of federal urban policies: (i) the shifting priorities of urban policy characterizing urban renewal, the Community Development Act, and recent neighborhood-oriented redevelopment efforts and (ii) the sociological theories which underlie such priorities. The first part of the article traces the shift in priority of national urban policy from an earlier focus on economic redevelopment and housing assistance for the economically disadvantaged to the more recent thrust toward neighborhood rehabilitation, revitalization, and stabilization. The central role of private sector economic involvement in the new urban strategies is discussed and the triage model of urban development is proposed to explain recent urban policy efforts. In the latter part of the article the sociological theories underlying many of the new urban policies are shown to contain inherent contradictions and inadequacies which were largely ignored by policy-makers. The authors conclude that the articulation between these theories of neighborhood dynamics and the present urban policy focus dooms recent programs, once again, to failure. This article addresses two primary issues: the priorities of urban policy which have characterized urban renewal, the Community Development Act, and Urban Homesteading, and the sociological theories which underlie these priorities. Most of the analysis will focus upon the latter two programs. Previous studies of these programs have focussed upon administrative, legal, or funding arrangements, or have attempted