HUD ISSUES EMPOWERMENT ZONE/ENTERPRISE COMMUNITY REVIEWS;
WASHINGTON -- The U.S. Department of Housing and Urban
Development today released its reviews on all 72 Empowerment
Zones and Enterprise Communities, a ten-year program that
provides federal aid and tax incentives to revitalize distressed
communities. The agency reported progress in five of the six
Empowerment Zones and in 62 of the 66 Enterprise Communities, and
warned five communities that they were at risk of
decertification, which would terminate their EZ/EC status.
REPORTS SUGGEST LESSONS TO BE LEARNED FOR ROUND TWO OF ZONES
* * *
PROGRESS CITED IN MOST COMMUNITIES;
HUD ALSO WARNS FIVE CITIES OF POSSIBLE DECERTIFICATION
"Our performance reviews show that, at this early stage, the
vast majority of Empowerment Zones and Enterprise Communities are
already showing real, and in some places, substantial progress,"
HUD Secretary Andrew Cuomo said. "The reports also highlight
communities that are not yet showing progress and will be
receiving more intensive HUD oversight and technical assistance."
"Because this program was designed to meet the needs of
America's communities, not Washington's bureaucrats, this is not
one program but really 72 programs tailored to help revitalize 72
different communities," said Cuomo. "Progress in each zone is
measured against the goals communities set for themselves, not
against a one-size-fits-all, cookie-cutter federal standard."
"The overall picture we get from these reports is that
nationwide the zones are stimulating billions of dollars in
private investment, beginning to revive inner city neighborhoods
once given up for dead, creating jobs and helping families move
from welfare to work," said Cuomo. "We also can see the key
lessons we've learned that should be applied to round two."
The performance reviews are intended to serve as a
management tool for the cities to receive feedback on how they
are proceeding. HUD is also conducting an official program
evaluation, which is a ten-year academic study that will issue an
interim report past the five-year mark.
Among the top national performers at this stage of the
program are the Baltimore and Detroit Empowerment Zones, and the
Enterprise Communities in Akron, Burlington, Charleston,
Columbus, Southern Nevada, Lousiville, Nashville, New Haven,
Norfolk, Rochester and San Francisco.
Five communities are being notified that they could be
dropped from the program if they don't improve their performance.
Of the six EZs this includes the Camden portion of the
Philadelphia-Camden zone. Of the 66 ECs, these include: Ouachita
Parish, LA; Pittsburgh/Alleghaney County,PA; Oakland, CA; and
Key lessons cited in the report will be used by HUD in the
near future to consolidate recommendations to President Clinton
for the implementation of a second round of zones. They include:
- Leverage Private Sector Investment. Almost all EZs and
ECs that showed progress are creating new partnerships with the
private sector, stimulating private investment to flow back into
many inner city neighborhoods. The reports show that a small
amount of federal funding can attract significant private sector
investment. Projects that depended solely on federal funds
tended to make the slowest economic development progress.
- Make Community Development Comprehensive. Instead of the
traditional approach where communities plan development projects
piecemeal, local communities are best able, and most likely, to
generate overall revitalization of distressed areas if they do
comprehensive development in partnership with community
residents, the private sector and all levels of government.
- Achieve Community-Wide Buy-In. While there can be tension
generated by meaningful and diverse community involvement in the
planning and implementation process, this tension is often an
effective barometer of the communities commitment to achieving
community-wide buy-in and thus generating lasting change.
- Use Performance Benchmarks. Performance measurement is an
important part of ensuring that federal tax dollars and tax
incentives are used effectively. This is also a critical tool to
help communities gauge their efforts and make mid-course
corrections to their projects as necessary.
- Coordinate Among Government Agencies. Extensive
interagency cooperation at the federal and local level is vital
to the success of community revitalization efforts.
HUD formulated its opinions of the EZs and ECs for these
reviews based on the experience it has gained working with all of
the zones over the last two years. HUD also gave consideration
to the following sources of information:
"While only 24 months have passed since the designation of
the Empowerment Zones, investment strategies suggest considerable
rethinking has occurred at the local level to achieve positive
and sustainable community development," said John Korbel of Price
Waterhouse in summarizing the Price Waterhouse review of
Empowerment Zones. "The Empowerment Zones have made significant
strides in utilizing federal funds and tax incentives to attract
private sector investment, generate job growth, stimulate new
business openings and expansions, construct new housing, expand
homeownership opportunities, and stabilize deteriorating
- Performance reviews submitted by the EZ/EC identifying
actions taken in accordance with the community's strategic plan.
- Reviews/assessments by HUD's Office of Community Planning
and Development field offices, including on-site monitoring.
- Progress reports by State agencies that administer EZ/EC
block grant funds.
- A General Accounting Office report: "Status of Urban
- Third party analysis and on-site reviews conducted by
academic institutions, including the Rockefeller Institute of
Government in Albany, NY; the University of Illinois in Chicago;
and the Center for Neighborhood Technology in Chicago.
- A review of investment activities in Empowerment Zones
performed by the firm of Price Waterhouse.
- Consultation with HUD, the Department of Health and Human
Services, and the Federal Community Empowerment Board.
"While the Empowerment Zone effort will undoubtedly be
judged by the tangible outcomes such as number of jobs created,
housing units constructed and businesses relocated or expanded,
it very well could be the intangible outcomes, such as a renewed
notion that local residents can effect change, that becomes the
true measure of...(their)....success," said Michael Bennett, the
principal investigator for the National Empowerment Zones Action
Research Project, which is based at the University of Illinois at
Chicago. He is also a professor at the University.
"The EZ/EC initiative is intended to serve as a catalyst for
locally generated strategies toward resurgence of distressed
inner city areas," said Professor Richard Nathan, who authored
and was the principal investigator of the Rockefeller Institute's
report. "Knowing how complex the task is and how other efforts
have fared in this environment, we are impressed by the amount of
serious effort and activity generated by the EZ/EC initiative."
Nathan, the Director of the Rockefeller Institute of
Government, served as an official in the Republican
Administration of President Nixon.
Explaining how the research for the Rockefeller Institute's
study was organized, David Wright, who coordinated the project's
administration, which involved experts from 18 universities,
said: "Local field associates in each of the 18 communities use
interviews, focus groups, individual case studies, and local data
sources to collect information on the wide range of...activities
being implemented in each community. The field associates...
include some of the most renowned experts in the nation."
Wright, Director of Urban Studies at the Rockefeller
Institute, served in the Democratic Administration of New York
Governor Mario Cuomo.
The six Empowerment Zones -- Atlanta, Chicago, Baltimore,
Detroit, New York City and Philadelphia/Camden -- receive $250
million in tax incentives, along with $100 million in flexible
social service block grants over 10 years.versupply of new high-rent apartments. In
Denver, new apartment projects are continuing to fill, but rent
concessions are widespread.
U.S. Housing Market Conditions brings together data from the
housing, real estate, and primary and secondary mortgage markets.
Data are collected from housing organizations such as the National
Association of Homebuilders, the National Association of Realtors,
the Federal National Mortgage Association and the Federal Home Loan
Mortgage Corporation. Other data come from HUD, the Census Bureau and
the Commerce Department.
The report, issued quarterly, is available by subscription at a
cost of $30 per year. Write HUD USER, PO Box 6091, Rockville, MD
20849, or call HUD USER at 1(800)245-2691.
Content Archived: January 20, 2009