DOCUMENT RESUMEPD 189 224

UD 020 717

Th.t VtOtident'S 1978 National Urban Policy Eeport: A
piennial 'Report to the CongreSs Submitted Pursuant toSections 702 and 703(a), Natiorfal.Urban Policy and
New Communities Development Act, as Amended in
1977.

Department of Housina arid Urban Development,
Washington, D.C.
HUD-CPD-328(2)Rua 70150p.; Charts and tables may be marginally legible
cite to small print.

INSTITUTION,REPORT NO
PUB DATE
NOTE

11

AF01/PC.06-P1us-Postaae.*Federal Government;_*Policy Formartion; *Public-EDFS -PRICEDESCRIPTORS

Policy; *Urban Areas: Urban Demography; Urban
Environment:. *Urban Improvement: Urbanitation: Urban
Planning: *Urban Problems
ABSTRACTThis report descri s the proCess of draWing up a
be views presented at various'national urban policy, summarizes
forums, and sketches much of the 4 ta.and analyses relied upon by ,.
lurban policymakers. Part I summari s the process of American,
urbanization leading to the emergence cf a new stage in urban
development. Part II descuibes changir populatipn trends andeconomic activity :end its imp6ct on the economic it.nd social wellbeing of urtan communities. Part III disopsses underlying cVanges inenergy and rtsourCe.availabli:ty, population, lifestyles, and theeconoty affeeking urbear- and re' icnal development..Part IV focuses
attextion on *le problems Of ,C -tunitieg, in economic transition. Pa'rt
v suminarizes the efforks and im acts of covernment'af all levels andof the private sector'in addressing urban needs. Part VI deScribes_
the process followed in,develcping national urban policy andsummarizes the urban policy principles, objectives,.and strategies
recommend0 to the Presislent: Transcripts of the National Urban
Policy tind New Community.Developmeht Act of-1970 and the President.'s
Message to Congress on .the" National Urban Policy (1978), and a'
tibliography of sources are appended. (Author/MK)

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JUN 1 4 WO

The Presicient's National

1978&bat Policy Report
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To tin Commies of di. United Stamm

I am forwarding4hwwith the First piennial Reportnr%
on National Urban Policy Iii accordance with Sections
702 and 703(a) of the Housing and Urban Cieve lop
ment Act of 1970, as anTended in 1977.
_

Jimmy Carter
The White House,
August, 1978

41.

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The- P esident'sA

ional Urban
1978
Policy eport
A Biennial
ort Tb The Congress
ubmit-ted P rsuant 'MI Sections 702
And 703 (a) National Urbon Policy And New Cs rnmunities Development
Act, As Am nded in 1977
Prepared I The U.S. Department of
Housing d Urban Development

August .1.9713

TABLE OF.CONTENTS
P*9.
1

PREFACESUMMARY

PART I:A NEW BTAGE IN THE NATION'S URBAN DEVELOPMENT

PART II:CHANGING URBAN PATTERNS

818

I. Decentralization of Urban Growth and Development
2, 'Changes among Regions
3.

4.
6.

PART III:
'k

.

1,

2.
3.
4:
6.

6
7.

Shift-Mg Perceptions in the Face of New Realities
The Conservation Shift

44
46

The Population Shift
The Lifestyle Shift
The Employment Shift

51

54
60

Opening Up Ojiportunities
Responding to Economic Transition
RestWucturkig the Urban Economy
Restoring the Sende of CornmuAity
Resolving Fiscal Dilemmas
Modernizing Urban Government
Restoring Urban Recreation

1.

3.
4,

Emerging State and Local Partnerships
Emerging Public and Private Sector Partnershibs
Emerging Regional Partnerships
Impact of Federal Policies Upon Urban Development

Making a National Urban Policy: An Interagency Process
2. Making a National Urban Policy: An Open Dialogue
6
3. Prindples for a Balanced Urban Policy
4. The President's Urban Policy
5. Fulfilling the National yrban Policy
AcknoWledgeTents

APPENDIX B:

APPENDIX C:

,5
77
-6

-79
82

86
-91

95
101

A NATIONAL URBAN POLICY
1.

kPPENDIX A:

66 ,
70
72

TOWARD NEWAIARTNERSHIPS FOR CONSERVING URBAN AMERICA
2.,PART VI:

37

ASSISTING URBAN PEOPLE AND PLACES IN DISTRESS
1.

PART V:

Growth in Nonmetropolitan Areas
Metropolitan Growth and Decline
Patterns of Urban Distress

AMERiCA'S OLD`PERCEPTIONS AND NEW REALITIES
2,
3.
4.
5.

PAR* IV:

20
- 29
33

\ NATIONAL URBAN POLICY AND NEW COMMUNITYDEVELOPMENT ACT OF 1970PRESIDENT'S MESSAGE TQ CONGRESS ON THE NATIONALURBAN POLICY, MARCH 27, 1978

a

114'
116

119
122
.127

W9

131

133

143
1

_

Preface1

In enacting the National Urban Policy and New Corn.
munity 'Development Act Of 1970. ,as amended In
October 1977, Congress proclaimed its purposes to:Provide for the development of a Notional Urban
Pol icy;

Encourage orderly economic growth. develop
ment, and redevelopment in our states, metropolitan
areas, and nonmetropolitan communities;
Encourage the prudent 'use of our energy and natural resources; end-

Encourage and support development which willassure our communities bf adequate tax bases, cornfrnunity services. job opportunities, and good housing
in sociaHy and economically well-balanced and physically attractive neighborhoods.

logical trends' affecting the Nation's overall growthand development, Only two years later, little purpose
would be served in reiterating such a -broad survey
although identificetion of urban decline trends Is
appropriate. Most of the. forces at work within the
Nation's economy in 1976 persist with little alteration1

in 1978.. Additionally, many of these broader aspectsof our national glOwth and develoTnent are treatedin separate reports to the Congress, most notably:
The Economic Report of the President;
I he Rural Development Progress Report of theSecretary of Agriculture;

The Report of the Council on Environmental
Quality;The. Eqployrnent and Training feport of the
President; aind,

on's progress toward these
To help measure, the.objectives, the President is equired to submit to Congress a biennial report that i clud4:

informotion on significant urban trends that relate to the development of the IVation's communities;

The 1978 White House Conference on Balanced
National Growth & Ecoriomlc Development Reports.

However, it would' appear to be useful tot Congress
to receive periodically an overview of the Nation's

A summary of significant problems facing the

growth and development trends of the kind sub-tional urban policy;
A review of state, local, and private policies andplans and programs relevant to national urban policy;
A projection of current and fbreseeable needs inconnection wi*h a national urban policy; and. Recommendations for cacrying out such policies.

a national urban policy, summarize§ Ole views presented at various forums, and sketches Much of thedata and analysis relied upon by the urban policybriefly summarlzes.the process 'of
makers. Part
American urbanization leading:up to the emerbenceof a n6tw stage in the nation's urban development.

United State's-as a result of these trends and develop- mitte,d in 1976. It appears appropriate for such a repprt to be submitted in 1982 following the next dements;
cennial censuS wheri new informalion will permit
An exarninatibn of housing and related community development problems experienced by .cities mdre detailed analysis of social, economic, and AySiNational 4anundergoing 9 growth rate which equals or exceedstile cal trends. In the meantime, the 1980
PolicyReportshouldpursueindepth
theunresolved
national avdage;
An evaluation ot the progreSs and effectiveness of. issuei"ised in this report.
Federal efforts to carry out a national urban policy;
The 1978 Report describes the Procw of drawing up
An assessment of interstate efforts affecting a na#

This FleOrt, the .first to be submitted AO Congress

I

Part II describes the changing national distribution of

population 9nd economic activity and its imPactunder the amended Act, describes'sOme progress andsome 'distress among the Nation's states, metropolitan
areas, and nonmetropolildn communities. The retiort
differs from its predecessors in-restricting its emphasis
to trends affecting urban areas rather than a broad
discussion of the growth of the Nation as a whole. Inpart, this recognizes' the intent of Congress in amend
ing the Act In 1977 to designated this, biennial reportthe "National Urban Policy Report" eimdistinct froM
the more general and ambiguous "Report on Urban
Growth" required under earlier language, It also re-upon the economic and SC:1CW well-being of the Na-

sharper focuS on urban development issues is- more
useful to Congress than the ieneral surveys submitted
by previous Ackninistrations.

lic consultation aspects; and it.summarizes the urban
policy principles,, objectives, and strategies recommended by 'the U R PG to Prdsident Carter. These principles, objeCtives, and strategies constitute the urban
policy of the Carter AdMinistration. On.the basis of
this policy and an accompanying analysis of existing

flects the conviction of _this Administration tfirit a

The 1976 Report provided a general summary of
population, sOcial, phTical, ecOnornic,"end techno-tion's urban communities. Part III discusses the under-

lying changes in energy 'and resource availability,
population, leestyles and the economy .that are
affecting ttle Nation's Orban and regional development
and will COntinue to influepce it in the future. Part IV

focuses particular attentithl upon the problems ofcommunilies In economic transition. Part V summarizes the' efforts and Impacts of government.at eachAlevel and theprivate sector in addressing urban needs.
Part VI describes theoprocess followed in making anational urban policyboth its interagency and pub-

416

Summary of thA Reportprograms, various changes to existing programs have

Tho continuing decentralization of the Nation's 218

been recommended to bring them more In line withthe urban policy, In addition, Pre ?Went Carter has

million peOple,and the dispersal of its economic activities are having important consequences, good arid bad,proposed various new initiatives to fill gaps in existingfor each region and urban area of the country as it
apitroaches 1980. For some this urban "thinning out"

urban programs. The text of President Carter 45-4114as

sage to Congress oolining the. new initiatives is presented in Appendik U.

si his Report, then, differs from previous Repqrts In'that Jt not only surveys urban problems. It also pre' sents a comprehensive urban policy. This-policy calls
for a new partnership to conserve America's communities, and it is already being employed to guidepolicy formation and program implementation in the
Carter Administration.

Prkess has Veated thQ special prenures- of Lead.

growth, tor others the.social and fiscal strain of population and empl4ment decline.

No region has a monopoly on the problems of either

growth or decline. There are urban areas in every
region suffering from population sand employment
loss. And there are communities confronted withproblemS of rapid growth. Poverty and unemployment exist in most communities, but are mpre concentrated in some than others.

However, the older, formerly industrial cities are afflicted with absolute increases in their poor populationsi rneanwyle, they are ,losing middlri and upporincome population together with employment, particularly manufacturing employment.

Ihy

Mismatch Batw?en Present Policies and Now Realities,

As.Migration from nonmetropolitan to metropolitan /,areas has ended and national fertility rates have delined, technological forces leading to tile decentral-

ization of urban develomnent and the dispersal of
population ancLeconomic activity Qe become moreevident.' The Nation has entered a new stage of Urban
development, but national policies have failed to matchthe new problems that these changes have brought tourban communities.

It is now essential that the Federal government,
coun,ties and othap communities cooperatively improve their ability to anticipate thestates, cities,

implications qf new trends,, Past perceptions are nolonger a reliable guide to the urban future.

Federal policies favoring new construction over rehabilitatioj of exjsting fadlities and housing must be
revised tof ect the growing neec to conserve energy"'

and materials. Those favoring stiread developmept
11

must be modified to favor energy and capttarconserkiing patterns of urban growth,

F4ieral grant-In-aid prografns should extend assist-ance for modernization as well as cdnstruction ofcapital facilities. Tax policieq favoring new construction over renovation and use of existing \structure
should be revised. Nbtional housing policies. shpuld-assure an adequate ratio of rehabilitation to new construction in meetingt housing needs. Transportation
programs should help' to reduce energy consumption
and to maintain and i pro4 existing facilities.
--1t

mOdate them. But attracting new jobs into central-cities will not, by Itself, ensure that the central city
For the foreseeable future, migraVon will be a more unemployed will get those jobs. Many central cities'important determinant of area population growth are still the job centers for their area. They containmore jobs than they do persons in the working force.
rates than the natural increase of population. Many
Ahile
_suburban commuters come into the city tocommunities and urban -areas must _therefore _rjow
plan for poPulatIon decline rather than population _work there has been an acceldration in reverso cornmuting` of central city residents to the, suburbs to
growth, an unaccustomed challenge in the United
work.
Suburbs and city must therefore cooperate In
StatesThe combination of rapidly rising participa-solving
economic development problems. TheY are
Von of worneri in the work force together with theessentiallyinterdependent, part of an interlocking net
the
labor
entry of the postwar generation intoof
employment
relationships.
market, will place strains on the job market until thefirst half of the 1980s, after which there will be asignificant diminution in new entrants into the labor People in Dhtressforce. In the meantime, unemployment among black
teenagers is unacceptably high. Workers displaced by Special training, housing, transportation, and antimanufacturing modernization or relocation also con- discrimination programs must be mounted to help thefront major problems irr many older industrial cities. .central cities' structurally unemployed. Job training
programs, operated in cooperation with private em.ployers,
must be used to move unemployed minorLifestyle Chi Miles and Housing
ities into mainstream employment. Public service
Even though population growth rates have dramat- employment can be used as ô short-term source ofwork until a permanent job is found. Work performed
ically declineq since 1960, the household krmation
rate .will remain high through the first half of the under public service employed should help urban
communities improve their ability to attract new em1980s as the postwar generation reaches adulthood.
ployment while aiding the employee in aCquiring
These h9useholds are moch smaller than those of thepast,wilh many households consisting of singles, un- basic skills. The Federal government must mount a
future Urban Population Growth1fmarrieds, groups living together, families with a single
parent at their head, and two breadwinners rather
than the traditional husband-wife family. This is apt
10 alter the pattern of housing purchases and rentals.
The outflow of households from central cities is far
higher than new middle and upper intome households

taking, up residence in the central areas. However,
early evidence indicates a growing trend toward purchases of existing housing in older neighborhoods
with important potential long-run benefits for cities,
but threatening displacementrof lOwer income minorities unless appropriate steps are taken to protect
them.

Minorities are steadHy improving their hokaing conditions and there has been acceleration in black suburbanization. However', the minority poor still lag far
behind others in the quality of their living environment. Crime end deteriorating schoOls continue torepresent major concerns for inner city residents anddiscourage many new householders from moving into

older neighborhoods, while still others continue to...,_....maye.outto.escape these conditions.

Employrent and the Cities

strcIng new antidiscrimination enforcement program,for evidence is strbng that much minority unemployment is the result ofs discrimination nkther then'otherfactors,

Communities In Transition
Several components are required tO address the prob-

lems of older urban areas in the midst of economictransition:.A community and economic development comonent designed to create a physical environment
Tconducive to new firm formation and to provide thep...

economic incentives, space, land, sen)ices, and qualityof operating environment required to ettract and retain potential residential, nonmanufacturing, andspecialized high employment manufacturing appropriate to central city locations in the future.
Social and neighborhood components aimed atcorrecting the special impediments to economic revitalization, Le., high crtme rates, declining schools,
and chronic welfare problems while improving neighborhood housing and living conditions; enabling
workers to live anywhere of their own choosing in themetropolitan area; and.diversifying the income mix ofgroupS residing in the city itself.
)
A fiscal component designed to assist cities in tranThe decentralization of emptoyment has stranded

many of the central city poor who are unable tb k-siflon to meet the needs of their inhal:iitants in the facemove to outlying sdburban or nonmetropolitan areas

where there exists insufficient housing to accom-of tax liase deterioration while they seek to establish
a more viable economic base.

3

*A governmental modernization coniponent ynder
which the states, with Federal encouragement andproper support, enable improvements to the structute, functions, and finence.oPlocal governments inurban areas,'Progress Toward Objectives

Some states and localities have already begun toformulate new urban strategies premised upon mak-tcg more effective use of existing investment andbalan2ng new construction against re-use of the old.
Califbrnia, Michigan, and Massachusetts, in particular,
have developed new urban strategies. Cities andmetropolitan areas tfroughout the country are experimenting with new approches. A new era of cooperalion with the private sector in addressing economic
and corwunity development problems is now coming into qvidencd.

A growing trend toward regiOnal cooperation on:development problems requires a thorough reassessment of existing Federal programs supporting substate and multistate regional organizations. There is aneed to reduce_regional kagmentatfon and duplication and to strengthen capabilities in each region tomount cdoperative efforts with business, labor, civic
and othei' private interests as well as general local
governments.

and providinuipunter-cyclical financial assistance tostates and cjitr.
In. addition to this Sof ietil,pf policy initiatives, President Carter proMis-fd a coitOr4hens)ve national Olen
004y. On Meech 21, 1977, he treeted the When OM
Regional

Policy Group (URPG), an interagency

Cabinet-level body, and charged it with the responsibility for drawing up an urbtin policy for his Administration. The URPG followed an open policy-making
process. Several task forces wore crested to develop
policy in particular functional areas. Frequent meetirggs were held in which top Administration officials

cbilaborated for the first time in a unified policymaking process. 1\limerous experts within and Outsideof government were consulted as,the effort to Mindurban problems and alternative solutions proceeded.
Citizens forums were held in each regicln of the coun;try, and moetings were convened with top corporate,business and labor leaders to provide policy-makers
with f irst hand accounts. of ,urban problems. Special

polls were conducted to determine what specificproblems and deficiencies in theiCcommunities citizens were Most .concerned about. Numerous staff
meetings at the White House with"State and local
officials, minority comrnunity leaders, and neighborhood representatives provided additional contribu-

tions to the national urban policy making effort.
Altogether, it is estimated that over 10,000 citizens
were involved in these consultations.

Awareness of the inadvertent contribution of Federal* policies and programs to urban decentralization is
growing. More work needs to be done to assess the
cumulative, urban impacts of such major. Federal
actions as highway construction; water resource'development; tax, regulatory, and expenditurepolicies; iiind income security, housing, and community and economic development programs.

The Making of National Urban Policy
President Jimmy Carter assumed -office in January
1977 committed to fogrn new partnershif)s between
the Federal, State and local goverrepents artd between

the public and private sector for the conservation ofAmerica's communities. Early in his Adniinistration
he undertook a wide variety of actions to strengthen

From these open forums, meslitirfgs, surveys anti consultations, certain general prescriptions for a national
urban policy emerged:
The Federal government has a continuing respon-

sibility to ensurasequal opportt.inity to all citions. It
Tust affirmatively lead efforts te bring minorities andother disadvantaged citizens into the mainstream of
economic opportunity . and national life. Urban
policy, while focusing on the problems of places,
must be closely interwoven with people-oriented programs that are addressing the special needs of individual citizens and families living in urban communities.
The freedom of choice of low-income urban residents

who wish to move outside of cities to live or work
must not only be protected, but affirmatively
assisted.

National urbih policy muSt be concerned-with
the needs of jill urban communities within the conlive and work in them. They include: increasing text of natibnal priorities for balanced growth.
National urban Nicy must be sufficiently flexCDBO funding, and changing the formula to providemore gssistanCe to oliler declining cities; creating a ible to meet the diverse conditions that prevail in
new Urban Action G4lant program to provide assist- urban ,communities throughout the ,country and it
ance to distressel cities; expanding youth tImploy-. must identify procedurr by means of which that
American cities and to improVe the lives of thcise who

ment and training programs; increasing the number ofpublic service emplqment jobs; increasing Economic
Development Administration grants to urban areas;*s?.

diversity can be recognized and accomModated.

Within the broad framework of such a policy,
priorities should be established .on the basis of com-'National urban policy rust be sensitive to lealum the of fecliveness of a pronimplemented.
granraf ter It has
As a result ol the UflpG's work end the thought
arid debate that it- fostered oyer the past year, key
urban policy objectives and strategies were sele.ted to
guide -this-Administr-ation's ef fort to deal with urban
problems. These objectives wero carefully chosen toprovide a comprehensive set .of long and short term
policy Objectives (o deal with a broadsrange of urban
problenis. What these objectives share is the recogni-

The problems of cities cannot be solved Sol*tion that there is a limit to what the Federal govern-'fnunity need, a long-standing principle of:odr public'
life. Needs may develop out of both growtl; and de-.
cline, but the strategic targeting of assistance on thosein distress is both equitable and essential.

f,.

omuniti s
fundamental SOcial ties That iloinct human-cni
together by placing a clear, new emphasis upon therestoration of a sense of Community through the reinforcement, rehabilitation, and preservation ofneighborhoods.
lavithin city boundaries. National policy must he con-ment can accornpli.sh alone.The success of the kirban. cerned with the urban area as a whole,policy and its objectives will depend upon the creation of new partnerships among Federal, state andNational urban policy requires a partnership between the Federal government, states, county andipal governments, the private sector, and conm
citizens if it is to succtied. New procedures, tocernfacilitate a vvOrking partnership must be established.
Federal resources are Wiley, A fundamental re-\assessment of existing Programs is neceNary to ensure

their future efficiency and effectiveness. To achieve
ax-munl return on the Federal resources aimilable,
states and localities should be assisted and encouraged.

016

mentotion and toto use them to attract and supart other public andprivate investments in the community. Used alone,
Federal aid will never be sulficient to meet community needs. Used in conjunction with other funds, it
can play a critically important catalytic role.
A principal aim of national policy should be toenable urban communities to become economically
self-sufficient so that their support comes from theirfrown economy. Cities should be assisted in diversifying both their economic and residential
F6ture national urban 'policy shoul

local governMent 'of ficials,"bbsiness and labor leaders,neighborhood., and 'voluniary associations, and thegeneral public. -The urban policy off icms that the Fed-

eral governmentwill be committed to:
Encouraging and supporting efforts to improve
local planning and management capacity and existingFederal programs.
Encouraging states to becom6 partners in assisting
urban areas (i.e., eities, counties and other com-rrioities).

Stimulating greater involvement by ne'%iborhoodand voluntary associatiOns.

Providing fiscal relic), to the most tiard-pressed
communi ties.

Providing strong incentives to attract private investment to distressed' cortrunities.
Providing employment opportunitiesi primarily inthe private sector, to the tong-term unemployed anddisadvantaged in urban areas.

based onIncreasing access to opportunity for those dis

rpw away"a con'servation ethic rather than aould
be balethic. The use of existing investme
construction
in or
anced against the need for new

advantaged by a history of discrimination,...Expanding arlkt improving" social and health services to disadvantaged people in cities, counties andother communities.
Improving the, urban physical environment andthe cultural and aesthetic aspects Of urban life andreducing urban sprawl.

outside urbanized areas.
Federal policies and programs shOuld be coherently focused On sets of consistent objectives. Proceduresshould be established to assess the potential consequences of a policy or program prior to its imple-

tage inrbant,. A New Stage in America's
Development

etrbant,,I

8

The growth of ... cities has been an inseparable
accompaniment oi the growth of cMlization. There
are many obvious reasons, the defense of accuniulated wealth behind city walls, the concentration ofmaterials requisite for manufacture, the conctIntratiOn of power in the tome of human muscles and,later, ip the, forltri of available heat energy, the ease ot
mutual intercourse required for business_retations, thepleasure arising from a concentration of esthetic andcultural opportunities, the advaneages of a concentra:tion of governmental and other dire ingagencies,

ifs economic activity/away from central city tosuburl), from metropolitan area to nonrnetropolitanarea, and from regions of high poptilatiOn end ipdustrial concentratiön in the Northbast and Midwest toward the South and Westbecame more obvious thanthey had been* when high population growthrates andimmigration to urban areas .masked the full consequences Of zeChnological change.

Urban policies and programs conceived and enacted

under the different conditions of prior decades nb

administrative, legal, and military...

longer necdsarily match the special needs created bythese new circumstances. As it has several times in the'If we ex-amine the trend of technology during the past...the Nation must once agaitz reassess its policies
past generation, the reasons for this concentration are., that arp intended to hid the future growth and devellargely disappearing.
-more,
reasons for the opment:of our .p6mmunities, States, and regions andchoice of sites for cities are 9J66 altering. Mechanicaltailbr national urban pol,icy to the needs of a new
power can.' be transniitted r hundreds of miles men stage in our national development.

carcomrnqnicate almost instantaneously by tblephone, the chiefs of great organizations can be transported by_airplanes, the cinemas can produce plays inevery villatje, music, speeches, and sermons can be

1 broadcast. Almost every reason for the "growth ofcities has been profoundly modified.4

Manifest Destiny

From iodependence up until after the Civil War, ournational policy was Manifest Destiny. It was a popula-tion redistribution policy to fill up the heartland of
the country with settlers and 'entrepreneurs in order

Alfred North Whitehead, 1

to get_ the Nation's land and resources under develop-

from "Foresight" inment ès quickly as possible. The Nation enacted theAdventure's of Ideas
Homestead Act of 1862, the Timber Culture Act-of
1873, the Desert Land Act of 1877, the Timber CutWhen representatives from 130 Nations gathered in tirtg and Stone Acts of 1878. It presented innumerVancouver4 Canada, in june, 1976: to consider the, able land grants-from the public domain to the railproblems of hurnan settlements around the world, the roads. The policy worked. Settler.and ipeculator were`majority were concerned with the influx of populatibn from the countryside into the cities. Most of theworld's people still live in rural regions with few job

lured farther and farther into the interior. In an incredibly.short time, pait. policy built a Nation. Many

opportunities. Because of _these conditions, large
numbers of rural people all over the world are moving
410 yrban areas in search of a better life. In the developing Nations, cities are growing.at twice the rate of

tered; grew up at important crossroadson the seaboard and Great Lakestat river junctions, and where

the total population, with half of the growth due toUnited States became a country of small towns andvillages, each located within a half day's buggy ride orless of the surroundln6 cOuntryside.

hatural incite's& and half to migration from tile
countryside. In the past quarter century; nearly 300
million people in Latin America, Africa, end Asia left
their rural homes for the cities.

Until the mid:1960s, these same patterns of rural-tourban migration prevailed in the United States andother highly evelopéd countries. In the late 1960s,
however; the7United States and several other advanced industrial countries entered a new phase in
their urban development as migrations of rural population intdrpetrdpolitan.areas dwindled to an end andfertility rates declined. A's they.. had fof many
decades, modern transportation; _communications,and production technologies :steadily lassened thenee) fdr peOple and industry to concentrate. The desentralization of. the Nation's 218 million people.andof t4.cities of todWitffien mostly small and scatthe railroads joined. But, most importantly, duringthat first 'frontier stage of national development, theIndustrial America

That small town and rural Arneriea of the-country's
frontier period was no sooner created than it was
threatened by two changes resulting from the Na-/tion's industrialization after the Civil War.
First, the United States began to mechanize agriculture; enabling the productioneof more and-morekod
and fiber with fewer and feWer farmers. Having spent
the earlier Part of its history filling up th&heartland,
the Nation began unconsciously to empty it out again
as rural families, whose labor was no longer needed inagriculture, begbn to flow ti'ack Off the land 6n d into

13

walk to work. Transportation was still so fcrimitivethat very few citiltins could be very far from theirjobs. Rural and foreign immigrants poured into thecities in search of the rim jobs, just as in previous
decades peOple had rushed Into the countryside in

the towns and cities to run the factories. ManufacturIng located in cities and towns so that workers could

search of chelip land.

The induStrial cilies'and towns were horndense.
-crowded, compkt most of them in the Northeast
and around the loWer rim of the Great Lakes where:they could 6e close to the center of our national
population as well as the ports, new railroads, andcoal they needed. The great Northern Manufacturing
Belt with its industrial cities and towns came-to dominate the economy.

The South, still reeli g from the economic and social
devastation of thee Ciil War; was bypassed by muchof this develoPment xcept in a few ,industrial..Cities
such as Birmingham and Chattanooga. It fell far be-hind the reit of the countrypoor, ruyl, apd hometo-the overwhelming majority of black ,Nniericans.

The youthful West, still sparsely populated and moreor less isolated from the country's economic main-

The Industrial City)
6nited States Manufacturing Belt, 1937

Source Juan de Torres, Metrolltan America: The Development of Ifs Maio! Markets, the Conference Board, New York, 1976
Map:

Courtesy of the Conference Boagd.

1.

1' 4

41.

z
10

stream, was only just beginning to come into his own.
The Federal and state governments had only barely

their bounds. They suburbanized out across tho co n-.
tryside spraWling across the jurisdictional bound les

begun the vast\ water supply, Irrigation, and pdwer
projects th t were to underwrite future growth westof the 100t meridian.

of dozenssometimeis hundrecsof local

Metropofltit3Amrka
With the coming of the commuter railroad.tind automobile, it was no longer so'essential for middle andupper income Americans to gve close to where
they worked. With their newly-round mobility, they
could liVe in one jurisdiction, work in another, andshop in still another. America's urban areak-14(rstorn-nients and even across state lines. The old,mpacr
cities,of the industrial era diffused and became metropolitan areas with several centorssornetimos hardly
any center at all. Polifical boundaties ,no longer

matched the economic and social realities of mosturban,areas.

Following World War II, suburbanization accelerated
becan)e less dependent on the central city. Ina11

any parts of the Nation,- nAitropolitan ar etly. blended
ether, thus creating extended urban corridors.

me chose to caltsugh urban strips "megalopolis."thers saw suburban development tts the "outerc ty."

RuE1 im.rica1n Transition
American agriculture was rapidly becoming the mostefficient in the world. It could produce more lood.aad fiber with sewer and fewer farmers. As thenumber of rural Americans needeJ td mine and fan
diminished, the rural regions of the Nation continuW\
to empty ,out. Rural people moved into the metropolitan regions of the country, mostly along the seaboards a the Atlantic, Pacific, and Gulf and aroundthe lower rims of the Great Lakes.

..

The Motrop011s

Many small communities of rural America lo t mostof their young people. Many rural towns die or declined as 42,000 miles of .interstate highwa s werebuilt linking the key metrope.se.f--ttre----country. The new highways enabled rural people toshop and to woik in larger places pot too far away,eroding the market functions of smaller communities.
In the 1960s, major legislation was passed intended tohelp the distressed rural areas losing people and jobs;
the Area Redevelopment Act, the AppalachianRegional Development Act, the Public Works andEconomic Development Act, and the Rural Development Act.--tion that lacks over-arching purpose. Could the Notion
not, they asked, articulate a now framework of policy

to guide Its future growth and development? Could
it at all levels of government cla4) better job of.antic-,
ipating trencis BM developments rather than reacting
to eventf after they occur?

Post-Industrial Aniatiaa

Man Conamtration of Poor and Minodtios
But even as many were tisking such questions in the
But not all the problems of unbalanced economic late 1950s, it was clear that the Nation's patterns ofdevelopment were in the rural areas, for as the urban growth htid begun to change once again. America apareas suburbanized, and vice versh, so too did jot3s. By peared to be enteiing a new stage of development andthe 1960s. haltof the Nation's urban jobs were in the many of the issues that had been preoccupying it insuburbs, not the central cities. The poor moving to the 1960s were behind. The problems of the future
the metropolitan centers from the rural areas.116 were beginning to look quite different.
Appalachia, the Southeast, and Puerto Rico arrived
the central cities anfi inner suburbs just in time to tt appeared as though some pvts of rural Anierica
find the jobs they needed departing for the outer were over the worst. They were li.ompleting their tran-

lirsuburbs. The oldrbties and suburbs turr1ed increasingly into concentrations of the poor surr unded by
the more affluent.

sition from 'dependence upon agriculture, mining,lbgging, and tourism. A new kind of rurakeconomy

was developing as manufactur iog dispersed ourt)Ccoss
our interstate highways beyond the suburbs into non:The coming together in the ce tral cities of so mane metropolitan areas. Trade and commerce followed.
And so did peoplemfor the first time in a century aod
lower income Americans who were once dispersed in
rs of the Nation finally, through the a half, population' growth in the nonmetropolitan
the rural covement, wrenched the American conl_ ereas of the country outstripped metropolitan
civil righscienc4 ike the poor and disenfranchised who had growth. Urban areas were diffusing beyond the subgone before them, black Americans, in league with allothers who were being denied full social justice, led

the Nation to the culminating expressionof its commitment to social justice so farthe Civil Rights ACtof 1964. A plethora of newgislation was enacted to'meet urban housing proWs and the need for socialand economic action In the cities, Vast sums_werecommitted to restore the Central cities to their former,preeminence in the Nation's economy. Yet, the function of the central cities had changed in a decentralizing urban society.

r
TN, Need for Urban Policy
Suebasses were limited, failures many. Some despaired that the country could ever make sense 601 of

a multitude of prOgrams that seemed to work at
cross-purposes, one subverting the objectives Of.
another, More and more it is being recognized thatwithout in urban policyor policies on national
develppment, for, that matteprograms enacted

piecemeal do not add Up tilen coherent whole. In fact,

Net Residential Flows, 1970-76(000,000's)

their unintended side effeWcould cause more harmthan good fdr urban areas in need.

Many have asked why a Nation like the United States.

cannot define its general objectirs for its citlieS,

Nolo Witith 01 arrowl It plopoNronal 10 voluow 04 nI tows &wog Ins Wit moos
WON! StaNs Mitch
SOIJftCE US Efiff flu of thl Census tAobAly .01 IN Population 01 theb C iisWOW March1976 lows P-20 No 2156in Cofroni Popul000n Roo* VissNogIon.

boortmenl pi Comrnme. los'small -communities, and regions more cohereritlii

From Boon J L SOoy snd Demob C Dohnivo /Widen Oistobotion io In. UnitedStates ,r1
tip IP7011 tiNasringlon OC NatKmol flosiWC Coomo Nio.onal AcsOorny if 5c.

than through the piece-by-piece enactment of legisla-

1,7 7)

t.

6

it

105-isto

12

--

l

124
1

Wee

godhe est

North Contra'

53

01 6

415

438

275
s

.

Centralmiftris0111es

.

.

.

.

South

5e

22 8

)
4

Subtxdas.

33

1970-1976

311

West
472

Nonrnetropohtat1 Arnie'

it(000's)Nola Wsdlts 01

964

SOUttl.

75,*S 4 prop04.04sal 10 splurAh 01 not nows boNoon [hi 0,0.11

orthe set

..

"1

)

I.

N.

I

790

f-cU.S. Not Workorco Flows...1970-73

etrilrlI

1. North_

s0unct floponat Econonw Analysis Olvsuon Woo, -nto Matn r... loco 1073
SliNiy 0/ Curren! OtaiMMS OtIoNN. 1975 23-96

Net interregional Migration, 1965-71) and 1970-75

urbs intoerurol areas, presenting many rural areas andsmall communities with tho problems of growthrather than decline.

ThiVRegloital ghift\

Ws, WKftfs of arrows .4 p000ttorsal to voluns of not sn1ainegiona1 nsomition aosv now.
aCt:OniPanion9 #1,0.6 tniiKata monfatos of nal tnleffoosonaf nwants to thousands

60uncES US 19au of the Coma.
uramlowni ts1 Cenentmee 0

Neese ql the C

sisal, Marco 1979 to Ma.ch 1975P

1970. Wilbtoryton DC us

Mobely of the Peqtem

the UMW]No 295 t0 Cuffitot 715pula0on Roped,

Washington. D C u 8 Osolotov of Comm« co. Ien' From 13hen,J t Deny and Donald C Datrnann. -Popvinnon a I ribullto In INS UAW Staloi In

the 1970 a

A.

197))

By the 1960s, the major regions of the country werecoming closer and Closer together in their.economic
and social well-being. While there were still many con-centrations of poor in parts of the South, and the-regTOn continued-to-rank as-the-Nation's-poorest, it
was clear that it was rapidly Catching up: a new Southwas being born.

Something else was happening, too. Throughout the
1950sr and early 1960s, the South had beep losing

many of its citizens to the industrial cities of theNorth and West!'But by the late 1960s a.nd the 1970s,
the net movemept of Americans was in the other direction. More AmeriCans, black and white, were nioving Into thb South than were MOving out.

This change in the direction of net migrations, COMbined with the ending of net rural migration toward
the metropolitan areas and a dramatic decline in our
national birth and. fertility rates resulted in popula-tiOn losses not only in' centr

cities but also for"whole metropolitan areas.

(Wat7sIng+On. D.0

Nabonallhicowth CoTC:9. NM/mat Madan.), 01 98ar000s.

The'-Employment Shift

Together with the dec,entralization of retail anti otherservice employment, .the tie between manufacturing

and urban areas coitiiaJ

toseñ.Uiilike the deyS-ntury whbn factories.had to bein cities to be cl se to the WOrkTforce they needed,factories in modrn America' could locate out along
the interstate highways beyond. the urban fringe within automobile commuting range of ur an and rural
dwellers alike. Modern trariSportatio and communications, reinforcedy Federal actio , had made it

it the turn of th

possible for the cturitry's growth
decentralize.
Even white-collar jobs have been diffusing into
middle-sized and smaller communities, thanks to the,telephone, television, and computer, -The structure of the Nation's econorhy has beenchanging into something some have labeled "postindustrial." Fewer and fewer of new jobs are in manu-

facturing...and agri ulture. More and more are In
white-cciflar occup tions and services. Many firms cananywhetethe coUntry. The first
now loc'ate nea

'7

1

13

4,--

POPUL ATION [MECUM! 46,

SINCr/19TO

c.,Standard Matropolitantatistical Albas
Definedby Office of Managsament and Budget.-October 1975 *Areas

to jobs. In many cases today, jobs move to where
Many pflople. want to be:0.

Tra<rt, Communicationties, Construction
10

swarming of people to pleqes
Yet ironically., the v
iheir
good
livingunaer cut the quality of
famedlife that blàught them there- in the first place. It islittle minder that in Die past dealde expanding
and; states ;throughout the country havemunit
wretld kith the dircult question of how tO manage ,u and control their growth while other areas face /he
opposite-problem of slow or no growth and anxiously
,ficc

E
10

tt,
-

seek new development.

The Chiller of Mashy
Each section of the United States confronts Js own
special agenda of groWth and development peOblems.
While parts of the South ,and the West seek to findways to menage theirgt1owth so that ft does not eompromise the quality of-life they prize ko highly, partsof the Nortpeast and Midwest face the challenge -of

U.S. 'employment $1Pantf
1

Sector: 1960-1976
evidence is being seen that a large number of Americans ndw. move In search 64areas known for their
good quality of life:, And SurPrisingly, many employers decide noW to locate ri these areas in order to,attract such workers, It used to be that people moved,

revitalizjng those urban .areas most effected by thechanges now occurring in our national economy,

No region has a monopoly on the problems of groor distress. While many of the cities facing'economic
trouble -are Jn the Northeast and Midwest, there are
4

IA

14

communities in the South and West facing similar difficulties. There are people in distress In every urban
area, no matter how affluent. Things are looking up
in many parts of rural America, but there are still'
many .oreas Mime families are isolated from opp4-

tunity. Farmers are still whipsawed by fluctuatinginternational and national markets for what (her Pro'
duce while their own costs for producing keep rising
relentlessly.
V':f

Many Orsely populated areas of the couhtry now

tion, places that sreceive tind generate the intorrnetioe

uponvvhich our economy runs and upon which ourcreativity depends.
)it2In a poselnclustrial economy, only

5 percent of the
Nation's jobs are involved in the production of goods.
The rust are in service trades and 9Ccupation: healthcrire, communications, transportation, education, financial services, government, recreation, and culturalactivities. While the services and products of suth

Industries can be disseminated widely throughout thelea) the prospect of intensive' development to meet entire country, they will be generated in large measthe Nation's.q2ergy needs with profound implications ures from our urban centers.
for water, envilonment, agriculture, people, and stopaand local governments..Other areas dependent upon For as long into the future as it is practical to foresee,
energy imported from another region or from over- central qjties are likely to-Jand should continue to--seas confront the challenge of pdapting to new pat- . remain Lenters for the Nation's financial, cultural,
terns of fuel use and conservation.
and creative life. They contain an overwhelming prk,
portion of the country's fixed investment. In the face
Some areas.,must cope with the problems of growth of increasing costs for energy, the growing demands
and new demands, yitille others rtkist modernize upon investment tjapital, and the consequent need to
obsolescent facilities and put what has already been make better use of what is already in plaT, the Nabuilt to bettertion can ill afford to abandon its okfer citML: in favorof totally,new investments elsewhere that duplicate
Clearly, in the fa)ot such diversity, neither stand-' 4nuch of what has already been built.
ardized description nor standardized prescriptions'
are workable. National urban policy needs to be flex- -But °future urban policies have to be predicated uponible, 'amenable to adoption by the Nation's regions, what now patterns of urban settlement poind living arestates, cities, counties, and other _communities- to becoming and what the country wants them to bemeet their special problems and needs.
come, nob what they used to be or even are todaT
The challenge to the Nation's creativity is considerthe suture of the Nation's Cities ond Communities
able as it reconstitutes our older urban reas as viable
environments for 'life and work, ahd, t the same
The future form o urban development challenges the time, tries to forestall the \tery,Processes c41 diSintegraNation's imaginati and creativity. Pclicy must build lion and decay from beginning ie communities thatupon an Onderstanding of the bask changes at work are not yet distressed.
in our. urban areas and attempt to shape and direct
them to enhance the quality ot life for those who live Toward. Balanced Urban Policy
and work in 4theM. Beane of limited ederal re-aPbrces, Whas to focus much Of its attention upon Alcrng with the other Na Ions that met in Vancouver
thoie iridiN;id _els,...-f amilies, and jurisdictiov in great- in 1976, the Urtited Stet has subscribed to an interyst distress Ccause of the transition now underway in n-etional declaration callin or the development oftile structure of our urban life. Ana it has' to assist "coherent policies,on human settlement that wIll.help
urban areas in reconstituting their econOrhies.
'
ensure that people will have equielffle accesstto basic
public servicesNiund andedecent housing, ana oppor,v
While an economic ,and social transformation is un- tunnies for employment. This same sieclaration recogdoubtedly underway In many of our 'urban commu- nizes that the development of more coherent national'

nkties, central citiesperhapt ecournically restruc-policies ori the R-Oblems*of human settlements should

turbd and less populous than in thei7astare essential
to the new post-industrial ectno'rn now emerging.

derive from direct pu lic participation In the formulation of objectives an intent.

Though they rev continue to change in many of
their aspects, they are the essential nodes that tie the

newly, emerging economyWgether, No Mrter hoW
effkient and pervasive the Country communications
and transportations systems become, these systems
must traAie connecting points, centers of!comrnuhica-

As the ,Nation iiciès further teward 13 . More decentealized, post-industrial economy, Urban centers
whose fkconomic bases evolved when the forces of 4-spatial concentration were Much sfronger ,will'facespecial abblem adjustment andodapetion. For histor- '

9

40"

ical An so n s, such pirk'es tend to be concentrated in;%

the Manufacturing Belt of ethe klortheast and Mid.4 west. But side-by-side with such areas; there are pros-

plying urban areas in the Manufacturing Belt markedly similar in their "post-Industrial" social andeconomic characteristics to the expanding "magnet"
metropolitan areas of the South-and West. There arealso urban areas in the South and Vyest which areexbe 'encing 'problems of stagnation\ end distresssitjfl& to those in the Northeast and North Central
ions: The differences in perceptions of growth andne between regions are, to some. extent, a funcd
tion of the relative concentration of declining "cities
to transition" in a particular region versus its numberof growing "post-industrial" communities.

National urban policy has to seek a balance betUen
the high priority of people and communities in needagainst tho necessity to deter future distress in areas
experiencing rapid growth and develobmwt.

Broad-brush charactedstics of the Nation"s present
perceptions of regional arban( growth and detline
problems obscure other problern4 lesser in magni-

Ride, but, pOtentially fat more Siglif faint in theirimplications for the future. Tho seeds of future urban
decline and distress are already in eviden w. in manyurban Bung ngt yet experiencing population loss or
economic stagnation. And there is now some evidence
indicating that economic and social restructuring
processes are bedintirng in inany older cities. While
such trends are hot nearly aslquandatively significant

their outflow of jobs and population, there is atleast the possibility they indicate that longer-term. asprocesses of residential and commercial rehabilitation

are getting underway. Urban policy hes to take advantage of these emerging potentials to revitalize olqer urbtin centers even while it seeks to prevent deterioration in)yeas still groWing,.0 `OPEC

011

4

.44

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744. .7

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1. Decentralization of
Urban Growth and Developmentf
18"Whikt we are now witnessing is something more thanthe continued expansion of metropqlitan areas.
Since 1970, deconcentration has occurred at all ...
levels., This represents a clean breali with the previous
trends. The current changes represent a genuine turn-

politan area to nonmetropolitan area, and from one
section of the:country to others. In 1978 this Rend ising point from the Nation's precetiing trends toward
urlyinization and metropolitan concentration."

Some of these trends hove been underway for most of
this contuty. others have only become clearly evident
during the 1970s.

still strong, nhtwithstanding the ').back to the city"
movement.

it

1^.

411'

Brian J. L. Berry and Donald C.
Dahmann in Population Redistribution In the United States In
the 1970s
National Acidemy of Sciences, 1977

Metropolitan decentralization has bean undorwfriat
leastWith this decade. the United States appears to haveentered still another phase in the continuing decentr,alization of its growth and development.

Dispersal'of population and eFonomic actrvity awayfrom areas of former concentrattn has been one of
the Nation's-long-term historical tendencies. The east
to west spread of population since the earliest yearsof the country and the suburbanization of the.metropolitan areas during much of the-present century havebeen but' two of the most familiar aspects, of thissince the 1920s. .Similarly, the diffusion of

population and economic activity toward the Southand tst has been a lorig-term trend. But our highlyin tegr ated national transportation and commuMca
lions system plus such regional -factors as climate,costs of doing buisiness, environmental amenities, thewidespread adoption of air-conditioning, and, until
recently, availability of water and energy haye accelerated the regional dispersal, of pOpulation andeconomic activity- toward the South and West andaway from concentration in the formerly economical
ly-dominant regions'of the Northeast and Midwest.

Effects of Population Change

dif fusion.
0

Modern 'transportation and communications, reinforced by changing production technologies, the footloose chttracter of many Iiiitns in the post-industrial
Tonomy, the growing influence of residential ameni-

While these trends have been underway for much ofthis centurY, they were retarded by the depression of
the 1930s and World War II and masked by the highrates of natural increase in population and rural tourban migration that followed,World Wart II.

ties on populatiph movements, and the inadvertentconsequences of public policy have undendyritten con-tinuing decentralization in the distribution of popula-tion and economic activity of the United States at
every levellocal, state andregionef. ..
_.

ithere are differing interpretations of the long-n1rr

But since the mid-1960s the cessation of net no
metropolitan migration into central cities'and metropolitan areas, accelerated outmigration of populationfrom many central cities and metropolitan areas, anda dramatic decline in the rate of natural population

implications of ;hese changes.Some researchers pro,increase have uncovered _the underlying trends toward
decentralization and made them clearly visible,

claim a "new _economic geography of _America:
Others desoribe the transformation linderway as a
, . more or less pgodictable diffusion ofurban development acioss thr country at lower densities d thereby an equally predictable "decline of old , larger

In the 1950s, it is estifnated that 5.5 million Americans moved from the country to urban areas. In the
1960s, the figure decreased to about 3, million. But
between 1970 and 1975, almost 1..8 million persons

r scale mOved in the other directionback to nonmetrocommunities." Still others maintain that "while we Rolitan areas, reversing the, trend toward the urban

cities as centers of innovation in fgvor of sma

may, ase Nation, appear to be moving away from our irfeasahat began in the 1800s:

largest metropolitan areas, we will probably in theend come to find that we have merely created a hew
set of large places.".

No matter what the interpretations, the United States
is eXperiencing severel trendS toward the diffusion ofPOPulation and economic activity: accelerated decentralizOfion of population end ecOomic activity from
central City to surrounding pburbs; from metro-

22This net reversal' ffi the direction of nonrnetroplitanmetropolitan migration' was reinforced beginning in
the 1960s by a resumption of the long-term tendencyof the birthrate to decline (from 25 births per 1,000
population in 1955 to less than 16 per thousand in1976) following the extraordinary upturge in birthand fertility rates immediately after World Mt II. By
1972, the fertility rate dipped below replacement

.

./fr

level for the, first time and had remained below thatlevel since,
PerIllay Melo wad N.M.,' eno.....3111A.'1111a000

10ffe SertlPly

caoI

Since 1(50, home ownership has grown from 55
percent of all units to 65 percent in 1977. The overwhelming majority of this newer, owner occupied
housing is in the suburbs. Less than a foerth Is in thecentral citins, only a third outside metropolitan areas.
In the aggregate, these trends have helped- con.
tribute to e steady improvemenrin the overall qualityof the Nation's housing as new housing was buil, indeveloping areas to accommodate ne* households. In

Faaaaa~"nl Leval rwalety

1950, the number of Octupied units classified as,:being dilapidated was 3,8 million, or 9 Percent of all
occupied housing. By 1960, the percentage had fallen
to 4.3 and in the early 1970s the percentecje fell
below 4 percent,
1

I NC.

sm .()

el.

412 41The Human and Physical Com of Decontrelizedon

These changes in the Nation's population hive
reAnforced by an acceleration in outmiwation frornVcentral cities, older urboFt areas, and the Northeasternregion during the 1970s. In contrast with the 1950s,
the South has now.become a net regional receipieteof black, es well as white migrations.

But these transformations in the patterns of .,oursettlement have imposed high costs as well. Many of
the Nation's poor and mThorities have been trappedby the ebb and flow of the country's devetkment.
The fiscal integrity and governmental viability ofmany urban jurisdictions are threatened, ,Costs in
wasted energy, capital, and facilities have been high.
In some ,cities the decline in population hasmeant
excess physical capacity and Insufficient tax revenues

The dispersal of populotion has been matched by\tL3
dif usion of employment growth. During this decade,for adequate maintenance.
the o th replaced the Northeast as the second-ranking r ion in manufacturing employment, just behind
For Many of the ruril popr who earlier migratedOut
1973, nonrnetro:the North Central region.
the cities in search of opportunity,`9(!iitan em loyment hasibeen rowing more rapidly k of rural areas tothedecentralizationof the.economy has been a caah metropolitan employment, though not as
lamity. They arrived in the cities only to,find many
rapidly as suburban employment,of the jobs to which /hey might aspire, particularly inan facturing, departing for the outer suburbs andBenefits of Dacentralization

The decentralization of population and econcimic
a4ivitVhas yielded .benefits for many, distress fore-others:4
It has enabled the Nation .to move toward attain-

nientof -someIlegree of balance and:eqiiity in the_economic and social well-being df each major sectionof the country. 'This hos been a national objective
since the 1930s.

For the first time in more than six decades, manyrural regions, Once being decimated of population andemployment opportunity, are now 1ieveloping new'More diversified economies capab of supporti
growing populations with improvi 'males
For many Americans whoLr e mobile and canafford to move, the decentralization of the national
economy has opened up a wider choice of lifestyles
end living environments as well as opportunities for
eMployment. Residential and environmental amenities now play an increasingly important 15tik.in thedecisions of Americans about where they will live andwork.

Between 197q and 1975, the number of pt:ior in
metropolitan Qreas increased substantially while thenumber of poor in nonmetropolitan areas declined(partially a result of rpetropolitan area redefinition).
In total, all of the 8.8 peraent increase in family
poverty in the United States during the 1970s occurred in the country's metropolitan are0s.

The dispersal of economic acMity has been eroding
the fiscal foundations of many older,central cities andinner luburbs. After serving for three quarters of acentury es the focal points of our industrial growth,
many of these older communities find their employment base declining, their tax base deteriorating, thenumber and proportion of their poor residents rising,and their service cOsts escalating in the face of inflation,
States art regions containing high concentrations 61
cyder ,urban areas suffering substantial population end

2. Changes Among,Aegions

20

employment losses face the same problems of fiscal
strain as the urban jurisdictions themselves.

(

States and regions experiencing rapid growth in popu-

lotion and economic development confront an an ayof fiscal, physical, environmental end social 'pr essiirethat strain statutory and fiscal capacities.

Decentraliziition of poNlation and economic activity
at every level-regional, state, and logal-poses newchallenges in areas of rapid growth.as well as in areasin economic distress. National urban policy must be

broad and flexible enough to meet these diverse
needs.

"After more than 80 years of continuing industrial
transformation more than two-thirds of the Nation's
diatifacturing employment is still located in 'the industrial bolt stretching from southern New Englandsouth to the Potomac and west.to the MississippiManufacturing, therefore, remOns in 1960 much
more localized thtm either resource or service activities.Harvey Perloff et. al.
Regions, Resources, and Ect?noin1c Growth , 1960
Since early in the century manu fact ur ing has tonded
to disp(rse out of centi al cities intd suburbs and be-yond. But these trends were inhibited by two Vorld
Wars that encouraged reteytion of fSctories in cities
within easy reach of a concentrated labor force. The
Great Depression of the 1930s also slowed down thetendency for a time.

After World War H and the Korean conflict in the
1950s, however

the dispersal_ of rilanufacturing em-

icployment began to accelerate .within rnetropolijun
areas, within regions, and between regions, thus layin9 the foundation for today's economic and population growth in the South and the resurgence of many.

nonmetropolitan areas. From 1960 to 1975,410e
4b.

Northeast lost just under 800,000 manufacturing jobs

while the Sbuth gained 1.5 million. By 1973, the416,South surpassed the Northeast in its manufacturing
employment. In a brief two decades, the Northeast
surrendered its role as the dominart region of manufacturN employment concentration n the United'States. All but heayy manufacturing, which remains
heavily ,concentrated in the North Central region, isdecentralizing away from areas of former concentra-,tion..On the base of new ripnkifecturing growth,Many of the South"; internal markets reached economic "take off" during the 1960s providing, for the
first time, more regional jobs for those employed inservices than for those engaged in making goods, tninT

ing minerals, or producing food eV fiber. During the1970s, the South)replaced the Wer as the country's
most rapidly giddying region in population and employment. This is still the case in 197g.

In the ,decade of the 1960s, total national employment grew at a rate of 3.1 percent per year. The
South and the West grew at approximately twice the"rate of the Northeast and one argirne-half times therate of the North Central.

The disparity in regional growth rates has widened
even further in the-first half of the 1970s. While thenational employment rate grew at an average annual

\
vr,V

(.

--riffe--0-f 1.7 percent between 1970 and 1975, employment in the South grew at a rate of 3.2 percent a'nd in

21

a.

NORTHEASTNORTH
CENTRAL

11150-55

1950.55

19110-05=1955.60.7L 1965.70

1965./

1960.65

1970-75

1970-7

1965-70

1955-6-4WEST

15550

3.7

1950-51960-6

1.7

1970.75
2.9.

1950-55

1955-60

5.0
4.4

1900-65

3.4

1965 i01970-75

5.1

United States Change:

SOUTH

13.2
14.9
13.5
10.4
9.3

1950-55
1955-60
1960-65
1965-70
1970-75

Population Change for 5-Year Periods by Region.
1950 to 1975
Source:U.S.

Bureauthe Census, Currant Population Re-

the West by 3.3 percent. In the Northeast, total em-

debate. There is growing evidence, however, that de-ployment declined by 35,000 jobs during the tworecessions of the 1970s; while it increased in the
North Central region by only' 1.2 percent per year.
But the South's total employment increased by 3.3

industries not directly tied to resource or market

million during the same recession period, accounting
for a major share Of the Nation's employment expansion.
REGIONAL EMPLOYMENT SHIFTS
1 20.7%...EAST

27.%

NORTH

1970-75

14.7%

SOUTH

56%

10

20

locations. Undoubtedly, population movements arestill influenced by where employment opportunities
are located as well, but in either case, the regional
disper6I of economic activity is mirrored by shifting
patterns of migration among the Nation's regions.

West's by 24.2 percent, while Northeast and North
Central population grew by 9.8 and 9.6 percent re-spectively. Thus, while all regions of the country

lies
WEST
0

cisions by people about where they want to live areplaying an increasingly significant role in firm location decisions, particularly in those "footloose"In the period between 1960 and 1970, national poAlotion grew by 13.3 percent. For the same period, theSouth's population increased by 14.3 percent and the

EZI 1986-70

CENTRAL

30

40

50

80

Reglonai Population Shifts'

Whether population movements lead or follow shifts

in the location of employmen is still a matter for

grew, the South grew at a rate about one and one-halftimes that of the Northeast and North Central region,and the West grew at a rate about two and one-halftimes as fast as the Northeast and Midwest.

By 1980 the center of the United 'States population
may lie wcr of "the Mississippi R iver-a symbolic

25
'4-

of

Ports, Series P-25, No, 640, November 1976, Table B.

#

22

REGIONAL POPULATION CHANGE: 1960

1c75

(PERCENTAGE CHANGE)

mLI

1960-1970

24.2%
19 0-1975

The most dramatic changes have taken place in theSouth. The South experienced a ouite consistent pat-

20

14.3%

15

10

0%

tern'of butmigration through 1970, though national
recessions son-1061es resulted in brief, periods of'immigration. I3etwpen 196(1sd 1970, immigration-

9.6%

0
CENTRAL

OUTH

The West has experienced a relatively ,donstant pattern of immigration, except for tho massive Inflows
be anc%of the early 1960s. There does not appear
noticeable deviation frorn past 'patterns occuVring
In the'1970s.

WEST

to the West was foiir times the number of immigrants
added in the South. In the 1970s the trend was reversed and the South has become the major recipient.,,of immigration among the Nation's regions. Between

1970 and '1975, the South gained twice as many
milestone. But the center has,been moving westward
ever since the first census, and has been heading southin each decade since 1910. Discussion of the cotintry-

wide populations shifts in terms of the catchwords"Sunbelt" and "Snowbelt" is, therefore, somewhat
misleading. There; hes, Indeed, been an imbortant
shift of poPulation from the North to the South, but
the hiStork shift*e West, regardless of latitude orpeople as the West-26 million immigrants comparedto the West's 1,4 million. In one dramatically extreme

1975, Immigration to the South exceeded

year,

7014,000.

Patterns of Black Migration

4

Since 1971, there has' been a distinct shift in the pat-terns of black migration In particular, centering on

climate, has contikrThed; and extensive growth. is alsochanges in black migration between the North Central

occurring in many rural parts of the "Snowbelt."region and the' South and the Northeast anti theSouth.

In the first five years of the 1970s, the average annual

rate of national popUlation increase declined to 0.9
percent, compared to 1.3 percent in the 1960s, bUt
differenos in regional growth rates still continuedto
widen. Between 1970 and 1975, the South and Westgrew more than ten times faster than the Northeast
and more than four times faster than the Midwest. 'In the Northeast, a discrete leap in outmigration
Appears to have occurred between the 1954-66 and1967-76_periods. Net migration from the Northeast
to all other regions fluctuated more or leis randomly
around zero in the 1950s and early 1960s, but a persistent pattern of substantial net outmigratIon began

in the 1970s, particulkly frbm the Middle Atlantic
states of New York, New Jersey, and Pennsylvania.

Because of the. North Central's heavy industrial
ecOnomy, outrnigration frOrn the region is cyclical,
directly related to the ups and downs of the national
economy. Major upward surges_ in outmigration occurred in 1957-1958, 1961, 1970-71, and 1974-75,
Olijor periods of national tisonomic recession. Abatements pf outmigration, -and even some,periods of immigrattion, occurred in the recovery and thigh employinent years of 1959, 1965-59,08nd 1972-73. Generally, slow employment groWth in the North Central
region has led10,1a fall-Qff in gross, immigration, rather
in oftmigration.
than an incre

26

During the 1960s, there was a steady stream of non-white immigrants to the Nath Central region at an
average annual rate.of 3,3,000 net migrants. However,In every year since 1971, except for-1975, there wasnet outmigration of nonwhites from the North Cen- 'tril region to the South. During all these'years, except 1974, there was also substantial outmigration ofWhites: It appears 'that the inflow of black Southerners to the North Central-region has come tof a halt.
,

Miring the 1960s, the net black migration from theSouth to the Northeast was suhstantial, largely offsetting the net outflows of white population. However, since 1971 black net migration has generally
followed the pattern of white net migration, with
outflows of nOriwhites from the- Northeast to theSouth paralleling outflows of whites.4Net nonwhite
Immigration td the Northeast ihus also seerns.to have'come to an end.
Differences liVithin Regions

The patterns .of population and employment decentralization are also ,evident within each of the Nation's major regions.
During the 1950-65 period, California received a netof 5.3 million people in comparison hi the rest of the

r

.

,

..

.

23

to the Steith
Net Non-White Migration from the Northeast and North.Central
.
,

.

00

300
I
"Is

200

loo

.

Northeast

4

S.

North Centrali-200 .

56

1954.

..

i

1

60

58

lit

.

1.

1

1

62

tiir'

,66

i

68

.

I

l

70

72'

I
,

76

74

%

.

A

.

Source Currant Population lloports. Series P-20. Mobility Status bt tft popviatisn, Years 1954-1976'Data available only for aggregate 1972-73 period.. prorated equillor each year 1t
Net White Migration from the Northeast and North Central to the South

400

4North Central f\
I t

300

r.
co

2oq
7pt

2
.

Noith-east

z

100

-/

1

Tei

23

-E

z

#

.

1

A

V

2-100

-200
1-. 113g-4*-.A6... .,

60

se

7

64 46

62.

V

66

.

68

,

SoUrc Currant Population filtpotts..Series P-OMObijitySlatus obthe Population. Years 11A4-1976
A,-A'Data available oply for aggregate 192.7 3 Dodo& pr6rifed,. ecivally for-each year:
.

..

.

.

.72*

-.70

.

t

.

.

74

.

76

4.

western states, which attracted a total of only 1.5
million. Between 1970 and 1975, however, California
for the first time attracted a smaller number -of
migrants thph did the rest of the western statos. Be-

tween 19/0 and 1975, California attracted a net
iminiciation of 400,000 while the rest 91 the Westattracted a net of one million migrants. Thus, irithe,1970s the Rocky Mountain states have replaceAhe
Pacific Rim stateg as the fastest growing areas in theWest.

than the East North Central, horn 1970 th 1976,
ouhnigration fronl the East North Central Is now inexcesg of seven times greater than from the West
North Centro!,

It is decept& to characterize econdmic and social
conditions within any of the major regions on thebasis of apregate statistics that tend to gloss oversignificant differences between and within slates,
within metropolitan areas, end among groups in the
population living in'each region.

A similar reversal in role occurred in the South. From1950' to 1970, Florida attracted 2.9 million migrants

while the rest orthe South lost a net of 3.6 million
through outmigration. During the first five years of
Ahe 1970s, Florida received 1.4 million Yiet immigrants, but the rest of the South also accounted for a
net immigration of 1.2 mHlion.

In the Northeast, the formerly rural areas of southern
New Hampshire, Vermont, and Maine are experiencing high 1-ates of populatibn and employment growth,whilemany t11 the older, heavily populated and indus.

Waked areas in the rest of the Northeast are loing
both. New York City and Jersey City had less total

employment in 1975 than kr 1960. Employment
In the North Central region; the West North Central
states, which are pnklominantly agricultural, consistently lost poputation over the 25-year period fkl-.
lowing World War II, as riCany. rural residents wer'e-\levels in Utica and 'Buffalo in 1975 were almost thesame as in 1960, but were substantilolly higheririn
Nashua, Portland, Hartford, and Long Branch.

displaced by the increasing efficiency of Midwest agr,i-In the North Central region, total employment in theulture. For much.of that same period, however, thWest North Central states grew 50 percent .faste( thanstates of the pest North Zentral region were gaini g in the East NOrth Central states in the 1960-1975
population as many Southern migrants augmented period. In manufacturing, between 1960 and'1975,
the growing populations of The industrialized urban. employment declined by 0.2 percent in the heavily..
areas,.
industrial ed East North Central states, while it inCr
4.5 percent in the more agricultural WestIn tte 1970s, these relationshipthave reversed. From North: ent I .states. Nebraska and Wisconsin have19-3 to 197.5, the West North Centrars rate of popu- the highe population growth rates, in the 1970s,
lation increase was greater than that for the East Illinois and Ohio the Towest. Minneapolis, Columbus,
North Central. From 1960 to 1970, net outmigration
Indianapolis, and Omaha are the fastest growing cities
from the West North Central was four times greater in the 1970; Cleveland, St. Lnuis, Duluth, and

MAJOR POVERTY AREAS

mirm.detert Ar
sioux

I,

eft III gi
FOUR COR.NERS

100111111b1,0

latilajrotpc
DELTA
SOUTH 4TEXAS
Sourc. Bureau 01

OZARKSCENTRAL APPALACHIA
COASTAL PLAINSBCACK BELT_decline andDayton have all experienced significant population siAlongside older urban areas suffering job
population outmigration areas In the Northeast anddeclines.

In the West, Arizona and Colorado are the growthleaders in a population growth region, yet Los
Angeles fias lost 'almost 100,000 people and Seattle
almost 13p00_since 1970. _Nevada end Alaska are

Midwest, there are urban communities and nonmetropolitan areas in those same regions which are experiencing rapid rates of growth and development. And
both regions still outrank the South in the value of
their manufacturing output despite declines or stews-

tion in manufacturing employMiint. SOMe-mancrfac=
turing eribployment losses in these regions result from,the modernization of existing plants. As capital issubstituted for labor, workers are displaced, withlittle new manufacturing growth to absorb them. 0

growing fastest in employment, Washington and Montana the slowest.

In the South, HoustOn, Fort Lauderdale, and TampaSt. Petersburg, have had the largest population 1r-ideates in the 1970s, but Columbus, Savannah, andregions
Petersburg have experienced losses. Despite its recent 'The migration of firms between states and
gains
does
not
accountfor
most
regional
employment
growth in employment, per capita incope in thejoblosseshave
beengreatest
South is still below that of the Nation. Large con- or losses. For example,
centrations of rural poverty persist in the Black Belt, in the Middle Atlantic states. Of the eleven percent
deyine in that -area, Dun and Bradstreet data iodicate
Coastal Plains, Central Appalachia, and the Delta.
that\tess than three-tenths of a percentage point (.27)
In the West, minority pover y persists among His- or thr)ee percent of tbfitotal, arePthe result o'fIcer,
icans and native mericans as well as the MentSjof firms to otitlx regions.
panic A
lation. Several ities and older suburbs inblack phave also sustained population and em- Rather, low rates of new firm formation and lowthat regi
rates of expansion of existing firms in the older indus-.
ployment losses.

t

Percentage Distribution of Total Employment'
by Regiv and Location
196071970, 1975.

-Legend:Employment

Total
mploy men t

In Region'00

70
Norfheast

qp

'75

'70
"ea. Midwest

Year/Reclion,

Source: HUD, 'Office of the Assistant Secretary for Racy evelop and. Research.

I,

Outside SMSAs

Employment
Inside SMSAs

25

,

.
Ate.rc26

Components of Employment Change Between 1969 and 1974, in the North and South
Change in Jobs as a Percent of 1969 LevelAttributable to:,Total Job
Opportunities

Region

'7.

North

.

}Vow England
Middle Atlantic
Easl North Central
South

Birth

Percent
Changeof

1969-74. knit20.7.1_0_094

5.11

2.097.503
8.731.946
9.088.566

74

20.5
21 9
21 7
10 9

\

11

1

o3

20.963.660 'i 1 1 6.

iho

and L

bv C

IR 7

Expansion/
Contrac-

of
Firms

.

lion

Migration
Out ofRegionMigration
In toRegion
0 06
0 03
0 06
0 08

8 9 _. .._.

5_6

0.21

94

0I

9I

4.5
20
95

17 1

15 7

86

..

4

1

0 27
0 16
0 16

0 61

P17

L Ut171...

Rates of Closure, Birth, In- and Outmigration of Firms
in the North and South, 1969-1974
1,

RegionNorth.

ilew England
Middle Atlantic
East NorttiCentral
SdtithClosure
Rate

Birth

'x3
0.33
0.33
0.35

N)utmigration

Rate

Inmigration
Rate

0.20
0.22
0.18
0.22
0.29

0.00020.00220.0005'0.0005
0.00100.00070.00090.00170.00080.0003

ReRe,

Source: Documenting the "Decline" of the North by C Jusenius and L Ledebur. 1977

trial areas, compared to the South and West, accountfor much of the%lative gains and losSes. The closure

remainder of the region's urban areas experienced
growth much closer to the national rate of employment growth in this period. In terias of populationor" death rates of firms In the South and West areapproximately ttte same as those in the Northeast and/ North Central regions, but the rates bf expansion andnew firm formation in the Northeast and North Central are less than twb-thirdS those in the South andWest. Thu% new growth, rather than the relocation ot
jobs, explains most of the employment gains or lossesmong regions.,

growth, large metropolitan areas (those with over one

and a half

population) have had the loweit

growth rates between 1970-1975. Because 58 percentof the Northeast population and 54 percent of theEast (North Central population live in the largest
metropolitarf-areas, regional rates of population
groWth have been low during the 1970s.

.

,t

It is not possible to tell whether the advantages ofImportance qf Urban Areas in 11441onal Shifts

dense face-to-face contact and close juxtapositions of
A substantial share of the widening gap in the rate ofprocessors, suppliers, and support functions that led
employment growth .between the South and West 1 to high levels of concentr tion in the country's largest
compared t the Northeast and North Central is ac- metropolitan areas have ben eroded by modern com-coupted forl5y the difference in the growth rates oflarge urban ,centers. Between. 1970 and 1075, total

munications, trarwport aild production technologies
or whether the sIowdowr ar attributabItt to social

employment prowth rates, in the largest urban areas

and environmental reasons& b

the South and West, where the large metropolitan
areas are both newer and contain prOportionately
less of the regiopal Population, werevalent to the .growth rates fo these region The
growth rates for large urban areas in the Northeast,

centraliption in accounting for differing regional
economic and social problems Is clear.

To more fully comprehend the nature of thesechanges, it is necessary to look at the patterns ofand North Centrat, however, were decic444.1pris then'theft- respective regional rates, wit many experlepcing 'absolute !oases. lf the large kpan krees in the

Northeast are excluded-frowthe Nbrtheast total;

the role of_ urban

nonmetropolitan and metropolitan growth and distrek within the regions and attempt to determine.

whether there are patterns in their diversity that canhelp guideluture policy.
7

le

27

41%

4

Net Prillorititon in In.ilwktuit 5M8As

Abaoluie Possillation Champ. In 5M8As
1970-75

1949illet

1970 75'19410-70

Region1974 75

No,114.11.1 ;11AA,
4
Much liedNuontw,

NW'Ith111 ol Northu5s1
rimSAs MIKA

'44

natio micyaltor

22

19

ligt Oppulationnel 00111113,1111011

14

2-1

Number ol No lp coniral

NUMILTe. ol Norlh Conlisi
39
29

22
51

not In nuorithon

4159

not out ntorittion

38

32

gained DO0u1411011

brto9114141141 VOOulehon

lost emulation,

noI 15 rmorahon
not out illegfaliCI,145
20

Numpo, 01 South 5k.1 SA5Wh,ch had

Number of South 854SAs
whichØetosd Oboul *lion
lo4100Oulatron

5

5tIUMOOr Ot N5741 5MSAS

Number 01W4s1
3513As which

gained Dom, lotion
Wet Douti latton

wluch hnd

4

39

31)

3

3

35

net In nlioraboo
not out allot suon

Number of kr 8 SMSAI

Number 0118

which had

SMSAs which
38

145

no1 In n,o,abon
not OUt Migration

200
53

221

9eined oopulabon
lost 000u Iation0/

1970-75

kreso4u141

AbsoiutriNet
Migration(000's)P oPktfita

"

534 9

P11.1tulolottin

140 5

330 6
26 9
60 0

Net
Migration

Populat1on
Changememo(eoo-.)

25110
171 4

53

Now York

07,MLIP1119Volis St Paul

23 3

82 2

Boston10144v4lark/

1437

013 4

14a555u-Sullolk

15 /
06

Cincinnati

24 4
44 5

22 5
43
38.1
69 9
13 2
41 2
75.0

- Chicago
Detroit

15 1

99
3(10
118 6

711"1"

Konsoll City

SI Lours
TtstalOther, 63 13911111As

Norunotropolitan Counties

114

Northeast 5MSAs Populslion Over ..1031, MO;197075

North Central 8M84s Population over 1,000,000-827.7-227,4419 b.

173 3

577 3

Pillsburgh

liar/lord"91. Total

Other 35 SMISAs
Nonnustropolllan Counties

60 1

40 4
47

85 6
61 6
22 0
24 6

-963 t-377.9

-35 4

309 1
463 1

304 t

South 5M As Population over 1,000,000't/

1970-754,

470-78Absoiute
Population
ChangeNM
MIgratiOn
(000M

367 0
1

bill'
Other 32 !MIAs
Nonmetropolitan Counties

r

229 0
21 5

0

30 JoseDenver.
$gattle2090/14 97 I' 82 1210 6AnaheimLos Angeles
Riverside
San Olego
Sad Flencisco
S.

52 7
187 8
1405213

AllirniA
Matinibunna SI Pet0rStA179
Nnw Orleans

100041....,9210468 31

._

-ill
164 9

53 2

12 9

3349

1.106.2

540 3
544 5

1 013.2.

873.3

Abioluts

Net

Population

Migrallon

Chan**(00091(000 s)

110

710 0

1495

170 8

2BD
I

770 0
.47 9

Clallatr-rOil WOO('

11

174 1

Houstonpalltmorn

157 7

790

.10 7

Wavoslitmington 0 C

12 7

05 9
85 0

748 7
-2.-

----- Other 9411M8114 ..... -. .. .

...

Nonmetropolitan Counties,,,,,

I. Sq.,. P'(040;) \-iCtle

NowarkOultalo

Wei11111918As Population oVer 1.000,000

Phoeigx
Portlandr

0MSA3 wItcti Itan

BMSAs which

1,1264745 91,)30.0,.2,3041-1,1502

F":

C

28

PERCENT CHANGE IN METROPOLITAN ARE EMPLOYMENTBY MAJOR SECTORS AND REGION, 1
-1976
ALL

TRADE

FINANCE
INSURANCEREAL ESTATESEIICESGOVERNMENT

73 0

CIVILIAN

mourinws
30 6

20 0

05

)3 2

36 3

56 4

53 0

33 9
21 2

14 4

1

32

15 0

62 7

50 7

70 4

39 6

0

29 7

33

34,1
24 4

03 3

36 2

00 9

40 8
36 2

30 0
39 0
90 9
86 8

40 0
64 0
70 9
67-0

03 9
76'6
95 q

Total UiTited StelesU S SMSAs1272)-11 S Nonmehouoliian
Northeast SMSAs
North Central SMSAs
South SMSAs
West SIASAs
300,coTRANSPORTATIONCOMMUNICATIONS,AND PUBLIC UTILITIESCONTRACTCONSTRUCTION

MANUFACTURING

\

)

15 8

37

16 5

10 7

25 0
68 4
50 8

-6 2

16

60 0
13,7

36 5
25 0

33 3
61 4
04 7

AC ..1.111, Ic. CooternP.,,,Y I',04^ 1.0r NAIKPIAI,,,, .04 AS ferml.o. OAIAgo /PERCENT CHANGE IN METROPOLITAN AREA EMPLOYMENTBY MAJOR SECTORS AND REGION, 1960-1975 .
CONTIACTCONSTRUCTION MANUFACTURING

INDUSTRIESNortheast
AlbanyBostonBuffalo
Hartford
LancasterPhiladelphia
Pittsburgh

With Nokia
Cedar Rapids
Chalnpaign/
UrbanaClevelandCincinnati
Dayton ,DetroitGreen Bay
Indianapolis
Kansas City
Milwaukee
Minneapolis/

41

St, Pauk

Springfield
St. Louis
Wichita,-South
Atlanta
Austin J
Baltimofe
Baton Rouge
Belles
Houston,Nashville

-3.7

115.5

-0.4

18,7

26,9

-3 7

18.7

15.4
4.7

10.4

-15.7
-13 1
-21 1
-6 6

13_4

31.6
28.3

-8 0
35.0

7.1

3.6
18 9
26,2
17.6

17.2

15.0

10.9

-213

-15.0
-19.9

-7.8
-1.6

14.9
46.3 _
52.7
27.7
18.5

25.6
30.9

-6.2

1.5

47.2

io o

7.2
14 7

33.3.
24 8

32 0

14 3

-18.3
-1.5
-6.8
-5.5

103.3
13.5

rtwo

14.4

-6.0

-6.5

-14.1

4.2
9.9
40.5
10.8
25.7

33.0
24.4
28.4
31.0
30.0
90.9

20.8
13.3
28.1

, 48.843.5

20.1-s"

11.0

25.3

-18.4

46.4
36:2
13.3

'

-7.0 s

36.7

15.4

-20.7
-13 6

-36.1

.

-9.8

56.4
32.3

80.6

16.5

34.7
64.4
.6' 21.7.9103.05304 k.

west
Bakerafiald

Ban Fremoieoo

50.0
30,2
, 27.9
46.6
73.4
02.4

Seatthr

481
10.0

.

'

13.3
36.4

-6.2

2.9

1E14.2

-1

-2.9

-3.2

93.6

68.4
66.8

55.0
52.7
38.0
132.0
X
72,2
38.8

79.3
126.4
70.9
39.2
25.0
28.4

35.2
16.9

14,6

3.2

-15.7

j31.1

10.2

-18.4
0.8

.

9.5

v7,5

-7.5

28.2
04,4

7.1

52.2

)

40.6
23.5
72.4

,

4,

30.6
46 0
31 5

BOVE

40.6
43 9
41.4
36 4
67.6
74 2
48 2
35.6

39.0
50.0

54.8
62.G

119.0

63.6

25 1

40.4
46..2

33.3
28.5

;

75.6

23.8
57.8
76,5
25.2
85.4

3 .9

25.9 51.2
48.4
81.8
55.3

3

16.3

36.0

09'6

.9

53.1

31.0
25.8
200

50.0

75 o
56.5
44.8
67.6

90.0
96.5
61.8
68.9

149

70.9

30.1
125.0

'43.8

95.2
4110.6

38.
87.5
46.5
46.7
87.4
90.1
53.5
6103.4
65.9
57.7

16.0
22.9

46.b
100.0
90.8
158.0
106.5
158,1
105.4

73.8

-4,7

SBA
92.9

19,9

71.1

10.2
70.4

68.0
92.9
32.7
51.4
87.3

63.7
135.7
54.2

92.0
122.9

86.0
52.4
49,7

/7.2
114.0

,

147.1

I

09.5
90.6
72.0

147.7
97,3
119.6
137.5
149.7
101.9

152.8
110.0
79.6

,200.0

67.0
48.0
52.6
81.5
.106.2
58.5

90.7
53.6
74,3
90.4
118.9
58,4
91.5

81.5
97.3

T

63.11

58 4
45.0
71.3
100.4
67,1
87.0
69,5

64.7

21,0
32.3
43.5

SERVICES

51.3
51.9
68.2
55.6
59.8
91.5
69.1
60.1

11 4'

'12.0

43.9
51.6

.

1\6

-5.9
-3.0

21.1

63.4 A

Denver.

4.2
40.2
4.8

30.2

Wohinoton. 'D.C.

Sin Diago-45.7'CIVI4.414

PUBLIC UTILITIES TRAK REAL ESTATE

21.0'0

P11,119h

Portteng
SacramentoA

15.5-Kb.4.

47.7
74.7
101.6
53.8
109.9
03,3

OrlinO Ngs

FINANCE
INSURANCECAROM,

129.7
67.4

97.1

leinc 000*d by AMIMM61/ for ConlianaSorary Prtrns froo; National 14annItta Association data,(,

3. Growth in Nonmetropolitan Areas.V1I

A

oprnent Progress Roppr.t .of Congress submitted by
the Secretory of Agriculture in January 1978, underIs a"We don't know if the return to rural,Amer
one-sflot deal ... we do know that R Inv es the

Title VI Qf the Rural Development Act of 1972.

Ewes co-local, state, ancl Federal governments and rrrom thA-rtf)ort and othor more recent'sources, thetollowl trends ere obServable:

ordination."
Bruce ArkeR
Son Francisco Citizens Forum-June-23, 1977

Faster nonmetropolitan population growth The nonmotropolitan population. of the United states in-.
creased between 1970 and 1976 from 54.4 million to
58 million, a gain of 6.6 percent compared to only
4.1 ,porce91 increase in our metropolitan populatiM
during the siino period.

While' the dispersal of population "4 employment
among regions Is perhaps the most visible manifestolotion of.decentralizing trends, these same trends areevident in the diffusion of people and jobs between

metropolitan and nonmetropolitan

nonmetropolitan migration During theears of this decade, tho net 1.8 million
persons who moved into nonmetropolitan counties
reffesented a turnaround from the pattern of the
1960s when these seine nonmetropolltan countios

In theareas.

Reversali

first live

1970s, new trends in the patterns of nonmetropolitan
versus metropolitan growth became evident.

Nonmetropoliten areas contain nearly 86 percent of
the country's total land ar, 85 percent of our coun- Auf fered a net loss of three million in population.
ties, 80 percent of our townships, 70 percent ofmunicipalities, 67 percent of all special districts and Acceleration in 'nonmetropolitan employment Beauthorities, and 45 percent of our substaiii planning tween 1974 and 1976, total nonmetropolitan ernployment increased at a faster rate than total metrocievelopmen t distr icts.

politan employment-1,7,percent compared to 3.9
PercrIntbut not as fast as suburban employmwt,
which Increased 6.1 percent for the period. 1\iO4.

There are over 2,000 cities with more than 1,000
population located in nonmetropolitan America. The
nonmetroRolitan municipalities ore exPeriencing theresults of population and employment decentraliza1

tion as profoundly as metropolitan communities.

1',.....--Nonmertrolsolitan Growth Trends

itextent of change in' conditions In norimetropo an America relative to rnetrOpolitan America isTdescribed in detail in the Fourth Annual Rural Devel-

metropolitan employcnent.increases are due to an increase in cost and Other mining actiVities and jobs insupport of industriet, services, tradeend onstruction Additional servi_ce iobs ale resulting from ex- I,
pandod recreation and retirement activilies and 44
opportunities generated by government and colleges."

Nonmetropolitan income improvement Between
1979 and 1975, meilian frmiily income in nonmetro-

Metropolitan and Nonmetropolitan Populati4 Change,k1970-75
1

Net Migrat

l'opulation

1175

1970

Percentchange,1970-75

000s

000s

PerctAit'213, 54

203,305.

37'

58,01630,15627,860er.t.

ResIdel)t
41,
Total

Metryolitan*
Nonmetropolitan
Adjacent couhties**

Vnadjacent countiesa1970-75

1960-70

000s

000s

4.8

2,466

3,001

148,8814.1

625

64,42428,07026,354

6,6

1,841

.

SIP

2,996

7.4

P.7

.

713

s.

724

r2,273

43Airopolitan status as of 1074 ,"NoometfOpoIltaf\Countles adIa0fit Jo 1074 SM.BAS

eourcer Current P4ittatton Reports
41

Metropolitan end Nonmetropoillen employment Status of the
Civilian Nonlnstitutional Population, 1974 end 1976
4114441/9001h4n Aloes

unei

C,v4.4n Ilbor rorce

1914
10000

1975
(0004)

63 17366 664-60 336
5 249--bo477

E40019930
1.10umg4y4KI3)146

iin.centt
UnitrriNoyment 1,16te
N. Fa* ..1

68(Dementi
80
Cao.r.r.

1974 75
4/14nrs(144444111

1974(0004)

4

21 01070 330

44 0

749

30

1010e94111

65

1910
(00041
111

37 35334 0352 078
1997t4011
92

Iitalorn.....,11. CM... "'OM

Increases in retirement population This increase istaking place in such diverse rural places as the cutlover region of the upper Great Lakes (especiallyMichigan), the Ozarks, the hill country of central
Texas, East Texav-Coastal Plains, the Sierra Nevada
foothills in California and northern and .(oastal N
England.

Decline in Nonmetropolitan Royalty,
Worsen in Metropolitan.Poverty

The number of ponmetropolitan families with incomes below the official poverty level drokpeci 7

percept from 1970 to 1976, while the nutnbqr ofpoor metropolitan families increased by 23,2 potent.
The percentage of the Nation's poor families residing
in nonmetropolitan America declined from 47.9 percent in 1970 to 41.0 p'ercent in 1975, while both theshare and ebsolute number of poor families In metroPaten areas increased. Of-the 596percent of thi) Nation's poor who now live In metropotitad areas, threeout of fike live in the central cities.

tolol

b.,

1974. 76

polikan areas increased by 4.1 pcikent compared to a..,decline of 0.4 percent in metropolitan areas (in constant 1973 dollars). Nonetheless, the metropolitan/
nonmetropolitan income differential continues to be
substential$12,466 vs, $9,699 In 1975.

kfr-.1.

PIonrtueltopol41;909099101y1074(11.4449,11)

19/6
(0000

ohonte1974

1979

7974-76s,t44094

rporoeril)700434)70000

lp.44.1)

39 23161

29 190-4 0.44 0

2 r 00926 436

6,0

26

430

040

42 7

1044C41411

10411(417i1c

1 974 19

J06041,0,034 15715 500

44 0

1 690

730

19117cen11

191/r0im1)

63

71

27

4 1

1 0

creasing; nonmetropolitan areas ere now benefitingfrom the employment progress associated with disper-sion of4nufactwin9 end services.
Nonmetropolkan Development Related
to Metropolitan Dispetval

Still another aspe t of nonmetropolitan growth related to the genera decentralization of urban areas is
its relationship to acjacent metropolitan areas.

Over half of the incr ase in nonmetropolitan areas tiak
been in counties adj cent to metropolitan areas. This

indicates that at
t a substantial portion of nontropi5lItat ligratIon may in fact reflect the further

iffusion of rropolitan growth and that our definitions of standar metropolitan ,statisticel areas are nolonger sufficient,: by themselves, to capthre anddescribe the real patternit of social and econornic
activity that are emerging. To that extent, as npted
earlier,-some of the reported Migration to nornetro-,
politan areas may be viewed as an artifact of ourstatistical systems.

But this Is by no means the entire picture: ifhe rover-salkof migration tr4nds from metropolitan to non-inetropolitan areq is also evident in noometropolitan
countietthat are (04 adjacerrto metropolitan areas.
Specifically the counlies hav vg a population denety
Of.course, aigregate statistics must not be allowed to of less than ten people per square mile or no town
ob ure the extreme variations that exist from one witp more than 2,500 inhabitants are exper ncing
cosfier offural America to another. There are st II the highest growth in migration rates. Part
his
lerconentratLons of rural poverty, uneinpjoym
population growth is attributable tc; decIsior by
andremployment by-passed by edormicti aretirees to live in small communities In rural 6roas,
SOcial ,Improvement; the Black Belt of the Southeast part to the rearrangement of national and lace) patand' South Central staff's, the central and norther
terns 81 economic activity. One analyst has\ conportions of \Appalachia, some ereas along our nort
cludetlat& the "pattern of U.S. settlemept hai
ero and southern ,borders, and many:of theevolved beyand the point where naarnesS to a
American communities.
metropolis Is a prerequisite to locaLipigratory gro th.

I

The cultures of city slkOr aiidèuntry bu
Bt.h -oyer-all, it can be said that a new nonmetrol thrive mergedwith an swat, from televislim and thepolitan economy IS now developing in many parts of federal highway programaqd Safeweys, Sears ant)3e .diuntry. While agricultyrat employment has Sizzlers have diffusedliown the urban hierar y to
finally stabilizedland mrilngçnpioyment Is eln in. serve even small and remota settlements.'
I.) is.

434,

;
6

.e

Problems of Nonmetropoliten

Urban communities in nonmetropolitan areas are asdiverse in their character and economic base as their
metropolitan counterparts. Some are growing, manyother4 are suffering from economic distress. All reflect the impact of national decentralizing trends.

fiscal consequences as those suffered by older metropolitan central cities.

Much nonmetropolitan employment growth is occurring outside the corporate limits of nonmetropolitan
municipalities along highways in unincorporated
areas, %Similarly, nonmetropolitan urban places are
sustaining the same loss of middle and upper income

The rapidly growing small cities tend to be plong

rendents from within the municipal limits to sur-interstate highways and are neer airports. Some arecollege towns, some centers of government. Some arerounding unincorporated areas,

important recreational and cultural centers. Some
derive their incomes from surrounding agriculture orenergy development. They are the beneficiariersf dispersal and are experircing the pressures that Icome
with growth.
Many other small cities in nonmetropolitan areas are
suffering employmeht and population losses and are
lagging in income improvenient. The distressedsmall

31,

Such phenomena are but one reflection of the general,

diffusion of population and eenomic development
beyond the boundaries once -drawn to encompass1
much of our settlement and economic activity. As in
the case of metropolitan sprawl, this trend has ultimate implications ,for energy consumption, land
prices, and the nonagricultural use of agricultural land,
as well as the stability of small town governments.

/

cities have a' larger minority population than the.

growing ones, lire most heavily dependent on menufacturing for employment, and are part of a smaller
labor market.

Whether growing or not, small cities in nonmetropolitan areas face a variety of special problems. Titeir
economic base is far less diversified than metropoliftan

com'munities, making them highly vulnerable overtime to changes in markets and technology, and the,ups and downs of the national economy. Because al
their soall size and the fact that most new growth isoccurring outside Weir boundaries in surrounding un-

4

incorporated territory, their economiewell-being isshaped by what happeqs around them rather than
Othin then%Many of these growing centers:lack the basic, fkcilities.and housingkrequired to accommodate the new-a.bvel.

opment the arenow experiencing. A 1974 survey by
te Natonäl Leagile of Citiegyind U.S. Conference o
1814oprevealed that these 1. smaller municipalit i,7y. ,e lacking in the staff and resources required tohelp in the 'orderly accommodation of new growth.
Housing éonditionsfire still proportionately far poorer in nonmetropolitan that) metropoliterrareas. White %about 33 percent Of thp NatiOn's housing stock s innonmetropolitan areas, approxirnatelY 56 percerl pf
ithe Nation's remaining substandard housing is Iocstejf
t .has remained unchan
there--41 ret
1960,

,

,Nqrnspothn popeisi'To a dany urban centers in nonmetropolitan
areas hayglWn suloject' to trends analogous to sub-4rbiniza*With the .41ame ,social, economic, end

4

4
NY.

Mob.

Key

I.

4.

Nor Iltirn NOW Enriltatid ". $1 Lawrence
Northeastern Metropolitan Dolt
Mohewk Valley and New YOFIs
Permsylvama Ovule,.
North Appalachian Coal8.
8,

Lowe! tiresl take, industrial
Uppel Gjeat lakes

7()any thrlt
Central Corn Belt

2.

3.

8

9
10.

I I.
12.

13.
14.

Ohl Coastal Plain Cot1011 flett
Mississippi Delta

17

Gull ol kilted() and South Atlantic Coast18.

Florida peniinule

19.

OUTFLOW

IN 1960:
E NDEI;)

\Fr20

1111

INFLOWIN 1960s$ ACCELERATED

East leicas and NthornIng Coastal Plain0.(arkOutclota Uplands
Itio GrandeSouthein Gseat Plains

Air

23.
24.

.
NotlIteln'Grelt Pions'!lenity Mountains, Meow Valleys. and Columbia Basin

25.

Nortimn Pecsfrc Coast (including Alaska)'Ttot Soulhwess (including Hawaii)

26.

11111111111111

Southey Piedmont
Coastal Plain Toljaao and Peanut Belt

10

16

MIGRATION , 1970-75

Souther n.Cons Belt
Southern line jfillkor Uplands
Southorri Appatechiats Coal Fields
Blue FIrdge, Great Smokies. and Great Valley

COTNER

Ate
Nonmetropoliten-cotinties )onadjatent): the re\lersal of population loss

. DomographIc Changes In Regions of the United Statps, Rand Paper Series

Somme; Pater A. Morrispn,. MTow,p-egoo.(November;1977), p. 9.

4.

MetroPolittel Growth end Decline"In a NON, the American city is the locust of the20th century. I 's remarkable in that it Is almost enrk of human beings and just as men
tirely the handroy cities, men and women can
and women canalso plan and build and make our cities honorable
places in which to live."

Absolute Population Change and Net Migrationin SMSA's by Size Class, 1970-1975.
SMSA Size Class

Chairperson, New York City
Housing Authority,
New York City Citizens Forum,May 24, 1977

The consequrces of population and economic dis-NumberPer-cent

All standard motroPollion
statistical areas

Ms. Catherine Cramer,

Net Migretion

Absolute Population Change
Number
Percent

3,000.000 or more
2,000,000 to 3,000,000
1,000,000 to 2,000.000
e 00,000 tO 1,000.000

U to 500.000
100.4 !
260.000
Uncl: 100.000
Nonmotropolltan areas

6.271.700-360,000
136,000
2,132,600
1,453.000
1,477,100
1.263,600
169,500
3,476,900

4.2

-0.9

a7
0.1

5.7
7.0
8.2
7.3

690,500 0.5-1.536.900 -3.8
-462,500 -2.5
1,074,900 4.1
431,700 1.7558900 2.6

0.5t369,800

37

54,7001,770,200

2.4
3.3

kource. Oftrenr Popularloh Reports. Series P-26,

persal ard as varfeble for metropolitan areas as nonmetropolitan areas. Economic and socyll chenge may ! percent in populationsligthly more than two millionaffect each of the Nition's 277 metropollian areas; persons. Much of this absolute decline irt the central
dramatically decreased
differently depending upon its economic base, labor cities is accounted forforce,,location, age of facilities, size, and social com- immigration ahd equally d emetic acceleration in outplexion. Neither standardized descriptions nor stand- migration from the central cities of the country's
ardized prescriptions will 'suffice as the basis for eight metropolitan areas of over three million populanational urban policy. I t. is inevitaWre in a nation con- tion. While these absolute decline& in central-city
tinental in scope, with regional differences that are at population first became evident in the 1960s in-theNortheast and Midwest, they are now occurring inleast as important as their similarities, that individual
urban areas will reflect the diversity of the country. central cities in the South and West as well.
Nonetheless, it is usey tp make some generalizations

about what It hapoVing to Metropolitan areas andthe cities and suburbs within them before proceeding
to analyze them in greater detail.

If no annexation had- occured during the 1970s,
there would have been no growth in the combiriects,

population of all of the central cities of the 85 larpest
yen in the South atid West where centeal
cities are reported statistically to be growing in popuSMSAs.

The Componants of Metropolitan Population Growth

Until 1970, the Nation was not only increasingly
urban, but increasingly metropolitan. However, between 1970 and 1975, while the national population
grew from 203.3 millioii to 213 million, an increaseof 4,8 percent, metropolitan area population grew by
only 4.2 percent. In 1970, 73.5 percent of the population resided in ynetropolitan areas; by 1975 it had
dropped to 73.0 percent,

Although most metropolitan areas are still gr mg,
an increasing number are showing populatiài de"clines. Of the Nation's large cities only Pittsburgh lost
population in the 1,960s; it was joined in'the first halfof the 1970s by. New York, Chicago, Los Angeles,
Detroit, Seattle, Cleveland, St. Louis,- and Manyothers. The reason is outmigration to the suburbs andrural areas. The largest metropolitan areas in the Nation experienced a net outmigration of about 2.2 mil-lion people from 1970 to 1976, in contrast with the
net 'immigration of 1,8 milliOn in the decade of the
1960s. Of the 20 laitest ukan areas 11 are in thenortheast and north Neval area; all of these showed
net ou migration between 1970 and 1976, i.

1970 and 1976, central cities In metropolitan areas 'Its Ek class suffered an absolute loss of 3.4

elbetw

I

lation, a significant part of the reported growth incentral-dty populations would not have occurred if
1960 municipal boundaries had been in effect.
0.7

Trends in Black and Whit. Suburbanizalion

The suburbanization of metropolitan population has
continued unabated. The prwortion of the population living outside the centrqcities in the suburban
rings of metropolitan areas has grown from 27 percent in 1950 to almost 40 percent by 1977, Between
1950 and 1977, the suburbs gained over 40 million
people, almost six times the seven million population
gain of central cities and four times the population
gain in nonmetropolltan populationiduring the same

period, As ot 1970, for the first timl in our histoiy,
there were more housing units (24 -million) in the 4
sulSurb; than either/he central cities (22.6 million) or
the Natiort's norirnetropolitan areas (22,4 million).
Bolh blacks and whites are increasingly suburbEtnizihg
in the 1970s. While blacks increased from four to five

percent of the total surburban population betvteen
197-0 and 1977, the suburbanization 'of the black
population is only in its (Hilliest stages and is (nainly
concentraterien of the largest metropolitan areas.

al

II Wow

L.

1

2
Key

4

1

5

LOWer Groat lekrrs Inchon iel

6

UPPer Great Lakes

7

11

Dairy Dell
Central Corn Oen
Southern Corn Belt
Southern interior Uplands
Southern Appaliachian Coat Fields

12Blue Aloe. Great Smokier, and Great Yallty

13
144,,

Southern Piedmont
Coastal Plain Tobacco and Peanut Bah

IS

Old Coestil Plain Cotton Belt

16

Missippi Delta

17

Gulf of Meelco end 6outh Atlantic Coast

IA

Florida Peninsula
Ear Taidet and Adjoining Coastal Plain
Ouathita lJoIandi
Otask
Rao Grand.
SouthatratlotinkInaint

e
111

12

s.r

17

MIGRATION, 1970-75

1017.[OUTFLOW

9
10

13

IS

21

20
111

21

.22

.

1aw'en.

4

3

11

Northern New Eitorend

Noltheinten Metropolitan Belt
Mohawk Valley and New Yotk
North Appalechien Coal rialth2

tharth.N. Orea(raink

INFLOW,

Ponntylyania Border

.

24
26

Amity. Mooniain.s. Motroan Vatlaya. and colurnboa Bann

26

The SoudhassI (Inolodoo Howard

Northern Pacilia 6dist linclud;no MAO

OTHER
ts...

0.4

39
tropolitan counties: tt)e changing locus of migratory growthlaturce: P,Iter.

MOrrlson, Current fhtmographIc Changes In Roglons of the (Inited States, Rend Pepqr Series P-8000 (November1977), p. ).

40

rounding closely settled territories of the 60 largest
metropolitan areas) comPared to the' Northeast Ond
Midwest where-the mariufacturing growth of the fate"
1800s end early 1900s was iri the cities. The Conference Board has calculated that in 1970, only 8.3 percent of Southern manufacturielg employment was in
the law yrbanized areas of that region compared to.2 percent of the manufacturing employment in
the NOrtheasf and Mi&est. Thus, losses of manufaclUring employment arW much more seribus problem 4.
for older industrial cities.

Nonetheless, one study for.the Washington Center forpolitan Studies notes a-distinct shift in subur-;n r WI trends duririg the early 1970s. Black poPulath growth in the suburbs accelerated, while thee of white suburbanization declined. The Annual
ousing Suryey of the U.S. Bureau bf the Census
no ed a 34 percent increase in black suburban househol a between 1970 and 1974. Central-city Washington,lost black.population for the first time in'Its history -during that period. Nonetheless, most of
the black,.15opulation remains highly concentrated in
the central cities. In 1970, there were 3.5 black cen::tral-city families for every black family in the -sub-'Proportions Of Population and Employment inNorth, West and South Major Urbanized Areas;
1950 and,1970
1950 '

urbs. By 1977, the ratio had dropped to threefamilies to on& Regardless of these shifts, the propqr-

tiOn of black population in the central cities con-.
tiriues to increase-up from 4percent in 197.0 to 20
percent in 1977.

Lower Employment Growth i

MSAiand Cities

RegionPopulation

Total
employmont

North'

70.0
21.8
8.3
58,739

70.4
21.4
8.2
23,526-

West

South
TOTAL (000's)

Between 1960 and 1970, the employment in areas
largest central cities grewl by 46 peroutside thecent while employment in the central CSs prew by
only 16 percent: T.hus, the increase in en-Poyment in'suburban area§ was more than three limes the in-

RiigionPopulation

Nbrth

60.2
28.2
11.6
95;419-crease in central-city employment. While suburbanizaYtion of employment is a Rationwide phenomenon, in
the Northeast and Midwest, the stabi'irban growth rate

West

Smith
TOTAL (000's)

is almost ten times that of the central jurikliction. In
the South anfl West, annexation has enabled many
central cities to bring much of this new growth within
Their MuniciPal boundaries.

Manufacturingrnployment
.3
1

.7

5.0
7,221

1970

Total
Employment

Manufacturing
Employment

62

80.8
27.9

24.3
8.3
9,882

11.5
32,208Source: Juan de Torres, Metropolitan America: The Coevalopment of Its Major Markets, the Co'nference Board.

,e Cities

Decentralization of Manufacturing

Unemployment into 1972, manufacturing employment inlarge urba; areas grew by only 5,9 percent. Central
city, manufacturing employMent during the- same
period declined by 6.1 percent, while in areas outside
central Cities it gret by 21.2 percent. In the Northeast, central cities dberienced a not decHne ,in man*

The unemployment rate in central cities increased#T1016 1963

from 4.8 percent in 1970 to 8.9 percent in1978.
S9burban ratei, were lower in both yeah, 3.9 percent
and 7.3 percent respectively. High 'unemployment

rates in the central city reflecl the higher black unemploytnent rate-16.3 percent uneftloyment ratefor, black males in 197 - more than double the rate

factliting employment of' 19:2 peraenn:Itiing theenc. Suph high unemployfor white males of 7.
dties
have held the laborment rotes in the -cenforce partioipation rate in the central dtieS beloW' period .while sUburban areas grew by only a modest
7.7 percent. In the Midwest, manufacturing employment in central cities declined 6.6 peiCent, comparedwith a grOwth of 368 percent in areas outside centralthat of the suburbs and nonmetrpRoHt9n areas.

cjjes
Growing COnoentration of Poor In
Central Cities ind Ininr Suburbs

Western central cities experienced no manufacturing
growth, at all While manufacturing employment. inSouthern centpicities did grow by 20.7 percent during the 1963-1S2 period.

I

As more affluent citizens move from the central
cities, it is statisicallY inevitable that the relative concentratjon of poyerty in the 'central cities and pinnersuburbs.a.vill increase. However:during the 1970s, thealisolute concentration of povertY In the central cities
iuburbi increased as well.
and:14111/1

More sIgnificintly, proportionately moni341 the rela-.
tively new manufacturing employment in the Soqh is
outside orbospized areas (theit'central cities and'Iur-'

.

,

4
C

About 250,000 more families in poverty status lived
in central cities in 1976 than in 1970, a 16 percent
increase; 350,000 more low-intOrne families lived in
non-central city portions of metropolitan areas, a 35
percent increase over the six-year period. The poverty

areas in central cities .contained almost 13 million
75eople by 1976 and about 56 bercent of these (and64 percent of the poor) were black.

Nonmetropolitan families in poverty status declinedby 163,000 over the period, a seven percent decrease.

irepresenting a rise from 2.5 to 4.4 percent of tdtal
suburban income and 4.2 tok.7.2 po'rceneof total central-city incomes This contining high cat6 of dependence on public assistance income among central-city
residents is, in part, 8 reflection of the recent increasein .and relatively high proportion "of female-hooded
households in central cities. Public assistance inconi
in 1976 accounted for 23.3 percent of aggregate income for central 'City families with a female head, a
7.8 percent increase over the comparable percentage
for 1969 and 7.6.percent more than the comparable

proportion in the suburbs. About 30 perceffiof all

Conversely, the numtrer of nonmetropolitan families
earning over t15,000 increased by over five percent
during the same period while the number of centralcities families earning over $15,000 declined by seven

black central-city families have, female heads. By comparison, white female-headed' households ropresent

perefint.

proximately 10 percent of the white central-city

about seven pergent of the suburban total and aptotal.

Metropolitan-Nonmetropolitan Poverty Status,
1970 and 1976

TOTAL
Metro Areas
Inside Central Cities
Outilde Central Cities
Nonmetro Areas
North and West
South.

Source:_-Economic Impact of PosSulation Shifis

1976

1970

(000s of (perfamilies) cent)(000s of (Perfamilies) cent)

5,450
3,216
1,863
1,352
2,234
3,107
2,343

5,008
2,611

100.0
59.0
.34.2
24,8
41.0
57,0
13.0

100.0

1 ,609.

62.1
32.1

1,002
2,397
2,632
2,376

20.0
47.9
62.6
47.4

Current Population Reports, 'Series p-og, No. 106.

Decline ln Average FAmily Income.

IThe aggregate annual personal income in 1976 ofthcise who moved out of central cities between 1975
and 1977 was $40 billion compared to $21.9 billion
for those `whrmoved into central cities, a net anntJal
deckase of $18.1, billion during the; two-year period.
Seal losses in f)erSonal income have been persistent in
the 1970s.

Signals of Mitres
These aggregate indicators signal human, physical,
and fiscal distress in many cities and metropolitan
areas. But they are too general to provide the under-

During the ppriod from 1969 to 1976, families in ' standing we require of how these changing urban concentral cities experiencild an $866 decline in average ditions differentially affect urban communities
constant' dqjlar income from $16,883 in 1969 to throughout the country. For that purpose, we musttake .e closer look at the diversity ckt cirtumstances
76. While suburban families also experienced a decline of $360 from $19,765 to $19,405 , that exist from one urban area to another to see if
dUring this same period, the average effect has been some useful patterns in that diversity can be disto widen the incOme gap between.central cities and covered.
suburbs* $500.
$16,017 in

Average income -for black families is substantiallylower than that for white families in both central
cities and suburbs. ,The average 1976 income fcir .
black families in _central cities was $10,775 cotnpared

to $16,036 for white families. 'Black families in ,thesuburbs, however, were the only metropoliten group
to experience '4an increase in real income between-1969 and 1976.
The kola of Public.Assistanc*App,roximately 34 percentotall central-city families-

now depend on some 'form of pub I c assistance. Between 1969 and 1976, the increase in public assistance income .in meteopolitan areas was 70 pertent,
1'0

S.

--5. -Patterns of Urban Distress"Urban ills cen and do exist in regions enjoying prosperky endAprowth."..
4,ofne\ conomic activity shift toward the South ond

i

West?

Or is size now a major factor af fecting the growth

Mayor Rtert Folvm,

rates of cities and metrof)olitan areas? Have large
cities begun to lose the advantages thoy once pos-

Mayor of alias,
Dallas Citizens Forum,
June 8, 1977

sessed as ecOnomic centers when many firms hod to-"We have the specter 'for all of thosa..who are still
growing cities of how to avoid the cycle that has been
the experience of many of the older cities where they
have reached the point where the growth has leveled
off and then has started the inevitable cycle of decay
and decline."

Mayor Lila Cockrill
Mayor of San Anibnio,
Dallas Citlze s Forum,
June 8, 1977

IF(

The decentralization of population and employment
affects all municipalities, both metropolitan and nonmetrOpolitan; -central city and suburban. But the consequence vary from one city to another. For somethey spbll economic,' social, and fiscal distress. For
others they bring At pressures of rapid grewth. Stillothers continue to enjoy remarkable stability in theface of change. National urban policy must be respon-

sive to this diversity. While it may focus more attention upon communities where human and physicalneeds are the greatest, it must also be flexible enoughto meet the divergent `needs of communities throughout the nation.

locate in proximity to clients and suppliers? Have
today's transportation end -communications diluted
this need for face-to-face contact, thereby placing
Jorge cities at a dittxlvantage because of higher costsof congestion than are incurred in medium- andsmaller-sized jilaces?

Or is it age? Do older cities suffer from a burdenof obsolescence in illousing and facilities that puts
them at a cofropetitin disadvantage witli newer cities?
Some urban communities are experiencing rising per
capita incomes, increased employinent opportunities,
population growth, and am expanding base of local
tax revenue. Others have been remarfcably stable, experiencing little gain or loss in population or employ.
ment. Still others ar_A suffering from rising relative
concentrations oloverty, high unemployment,
population decline, and a deteriorating tax base. Are
these patternssof distress correlated In any way wit19
city size, the age of housing, or regional location?
Careful analysis is clearly called for, since the answey
can provide a basis for placing Federal assistance andattention in accordance with the grearst need.

Employmapt Opportunities<

Rates of utlemployrdent during 1975 in cities with
A framework of continuing'information and analysis
about conditions in our urban communittes.that retlect these variations in problems and needs will be-aniguisite foundafiorci for flexible and responsive urban

Oyes in the future. During the.past several years,
there have been a number of -affront by individual
researchers and organizations, as well as Committees
of .the Congress, to measure the diversity of social andfiscal hardship among the Niition's cities. The Brook-ings:Institution, /he Urban Institute, the Committee
for Economic 'Detvelopment, and the Department of
Housing and Urban Development have all been devel-

populations greater -than 50,000 ranged from a highof 18.6 percent to a w of 2.8 percent with a mddianof 7.4 percent. Unfo nately, unemployment is reguthe' asis f cities, but labor
larly measured notmarket areas becausekermmute -freelV acrosslebbr market areas copolitical boundaries. 1Ma
incide with metropolitan rather than municipal
boundaries. While there are a number of methods bywhich unemployment can be derived for smaller arAs
within a labor market, an analysis of 146 major labormarket areas-provides scre preliminary evidence ofthe patterns of variation among urban areas, partiou-

larly when unemployment rates are divided into
.and social well-46 of our cities? Are there patterns three
Intervals: rates below the national unemployoping such measures.

What factors are affecting the -econ omic healththat can be discerned'? Or are the fibrces of decentralization so general thal all American cities are suffering'distress because of them?
Does the region in which a community is locatedmrint rate in 1975, rates around the national rate, andrates well above that of the Nation during the same
year.

Forty percent of lab& markets containing over a mildetermine wheiher it is growing or is experiencing lion population had uhemployment rates above 9,6
some degree of economic, social, or fiscal distress? percent compared to 31 percent of labor markets beAre only the cities of the Northeast and Midwest suf- twen 500,000 and a million population and 33 'perfering from-adversity as population and the locatio9 cerit of labor markets with less th'an 600,000. Region-

-4-7138.1%ally, 66 percent of the Northo&t#th major labor

Po; Capita Incomo 119761 by City Sim. Age of City. and Hoglon

market areas had a 1975 unemployment rate of 9.6
percent or-greater, compared to 31 percgtht in the
North Central region, 14 percent in the South, and 42

Numbet 01 Ci1146
Row Port-ant

pet cent in the West.

CO1976 ILINIMFLOYMENT RATES FOR )44 MAJOR LABORMARKET AREAS BY SIZE OF CITY AND REGION;.sor,..t.ita.assommtamorasessmaa.

-1--

Unmnolornonl 1404D"
4.4-7,0the ofLabor 0444'11o4Aoso

144014,1

No53411

Numberof MosNylon o1C1Nos

NE.T. 0
NC

IIIOn

3

NE
NC

3

W

NE
NC

6-1 million

7

W
TOTAL U I

0

NE

1

.

TOTAL U.S.

Plosionof (31144

NE

2

NC w
8

4

W

14

TOTAL U S

NC .

1

1

3

- 14

NE .
NC .7

4

. 61

W

2

W

TOTAL U.13

10

TOTAL U.S.. 14,

W A. 0TOTAL ue
tt

NE
NC

0

NE

5
b

Nf

6 million

. 11

10. 3

8

.

8

1

3

W

3

31

TOTAL U S

20

TOTAL U S

25

+.0

iO

-

$9,536 vilth a median of $4,685. Incomes below thepoverty level. raqted from a high of 47 percent of the
pobulatlon to tonly tp pereent.4The median population Ipoverty in these cities in 1975 was 11 percent,In terms of -vet' capita income, the small, younger,
and wevern cities.'fare better than other cities. Higher

per capita incomes for molly of the smaller cities,
however; are reflecting the fact that many of them
ere actually suburbs.

Flow

lotal
-74
5.0

:Mu

211.2

16.7

5.-3

7,0

0.9

3.9

Muslims,. Cities

20

41

21

131)

(100,000to

20.7
40.2

15.7

33.4

409.009)

21.0
30.0

47
34.1
41,2

Small Citios(50.001) tu
001119 )

00
23.9.
03.0

60
23.5
51.0
114

Culu,n. I tile!

00
22.0

,

27.0

4

20.4
251

1.1)

21.5

00.0

5239 .

31.1
75.7

24.7

103
24.9

413
100.0

$11200 or

Row
Total

b Ago Of City
Number of Cities
Row Percent
Column Percent

Per Capita Income

Lon than$4200 to$4699

$4200-...
Ole

74

73

07

200

30.2
04.0

OM

57.4

25.3
71.6

40
32.0

40
32.0

79

10

125

35.1

12.8
15.5

30.3

42.0

23.2
20.4

94
22.0

.102.
74.7

103

27.0

74.9

413
100.0

114

$4200
20
29.2

lb
Mldwest32

14200 to$4849

$4700 to
$5100

23
24.0
20,2

71
21.1)

33
30.6
20.9

13.0
10.0
-

Column fotut.

Per Capita Inoome.
Lass than

7,9-0

West

Own

;iit.

Northeast

South$4700 to
$0199

25.7
04.9

loll

Older Cities

Hogion1975 ranged from d low of $2,196 to a high, of

7,$0700 or
Ow,

0
:11 3

Number of ClOes
Flow Parcant
Column Percent

Per capita income in all cities over 50,000 during

64700 to$0190

5Co)rmn Total/

64700 to$4099

l aroo Ciljus
1500900 orOver)

1 *Nem W- No-lhort IC Nom Contral

.

$4700

NC

W

TOTAL U.15
3

NC

.rorce111.

Pot Co01181

1 Ins than

NeOunDer Citldsn0

14

I nconto°Nuanbo.

2

6
4
4

8

==.n.oemnmseen-u S vromplorNml

ON 44

7.7.5.11

a. City Sire

703)
31

28.7
30.4

90200 or

Flow

Total

24

20.0
23.3

23.2

20
20.9
20.2

108

41

17

12

107

19,9
16.7

11.7

26.0

39.1

38.3
30.0

11./

14

17

117

10.7
14.9

37.3
36.0

.7

14.9

33
32.4
37.4

04
22.0

27.0 -I

102
24.7

103
24,9

41a
1 00.0

34.0

.

114

Sourco HUO. Office of tho Assistant Secretary for Policy Duyolopmont
and Roswell, 1078

The larg;Wa city, 1s, the more likely it is to have a high.,'percentage of retidents in poverty.

While the age Of cities does-nol\make an appreciable

difference in this indicator, soulhern cities are distinctly worse off In terms of both per capita income(
Half of the cities over 500,000 have lost population
since 1960, while almost 41 percent of the medium-sized (100,000-499,999) and a third of the small
cities 50,000-99,000) hke done so.

and percentage of residents in poVertY,

Population change appears to be much more linked tothe age of a city. Whilai three quarters of the bider

Topulatjon Goln or Lop,

Between 1960 and 1975, cities over 50,000 experienced population lossqs, as great as 3Q percent to
pbpUlatlon growth 91 over 50 percent. A out a thirdof the cities have lost population betweerk190 and
1975,4about a third have grown at rates tireen .1
percent and 29.9 percertt, and the remaining third
have aowriat rates Of aa percent or more.

4..

cities have litt populatior b. less than 20 percent of theyounger citi s have )klso lost population, Northeastern and midwesfern cities represent most of
the cities, losing population, While almost two-thirdsof 'northeastern cities werq losing Population between
196Wand 1975, the same pioportion of western cities
were grdwing by 30 percent or more.

,Puthinriof Distresswith low unemployment land growing

4.
C
popul

Several recent studies have identified the Nation's
cities facing the most hardship. While the lists lindranking of cities differ somewlukt, depending ort the

'

i

.

.. .

.

the Committee on Economic DAy41opmont ob,
served, oven this simple cfkision shows some signifi .

45,scriteria used iri each study, severitl of the same cities
appeffirleach study.

cant pattero: "the declining cities (groups Ond 2)
are larger in,ize thail thegrowing_cities. The growing

The Congressional Joint Economic Committee classified cities into four catetiories: 4
1. 'Cities with. high unemployment and .decreasing
popu latio9.

cities are predominantly in the South and West there
are/hong...in the East and only two in the Midwest.
The declining Cities are mostly in the East and Midwest ...." And laFge cities with high unemployment
ana declining population tend to be the worst off,2.

citief with low unemployment and decreasin

population.
Cit es wiTh high umnemployment and . growing
3.
popula n.
Problbm Combinations by City Sire, Age of City, and Region(brobd definition of "pr9blem")

Number of Problems

Number 0-1CItlits
Row Percent
Colum o Percent

3 of 32 01 3Large Cltles
1500.000 or

9
37.8

6
25.0

Neel

10.7

5.4

34
24.6
40.6

32

43

29

138

242

3i.2

314

20.6

30.5

21.0
30.2

...Mecflum CIO's(100.008 to
499.999)'None

1 col 3

6

\ 25.0
1 4.3

1

31
12.5
3.9

24

5.6

--.._
3..44

Small Cltlept

41

74

97

(50,000 tb
99,990)

10.3

29.5

r4t).0

08.1

36.7
05.2

17.5
57.9

04
20.3

112
27.1

141

34.1

16
10.4

,Clurnn Total

Row
Total

251
(10.0

_

Row Percent
Column Percent

Number of Problems

3 of 324

Younger Cities

olderiSlta
Column Total

2 of 3.14013

Oone

72

120
141.7
05.1

25.0
94,7

*AO

8.3
20.0

"C04.3

72

Row
Total
280
09.7

.

60

40

4

125

40.0
71,4

32,0

idU

3.2

v30.3

39.7

14.9

5.3

84
20.3

112
27,1

141

76

34,1

119.4

413

Number of OW

Pittsburgh
Atlanta
Cincinnati

Detroit
Baltimore

oledO

Washington, D.C.
Milwaukee
San Francisco

PortlandLong Beach
Oakland

Qleveland

Akron

BostonNew Orleans
St. Louis
SeattleJersey City
YcknkersSN)racuse

The Briokings Instituaion examined population loss,
agti M housing. and poverty levels in 489 central andsuboban cities with' populations above 50,000; 25
percent of all the cities exantihed had serious trouble.
Nearly half of the cities over 500,000 population fell
. into the "hardship" category.

-ea

The Brookings study confirmed the concentration ofhardship' or distressed cities ip certain regions of thecountry. Of the 123 cities on their distressed list, 83

Row

Celumn Percent

3 of 32 of 3

1 013

None

Tool

28
29,2
25.0

20
20,8
H41.2

6

Northeast

43
44.8
51,2

06
23,2

20

20

.41

27

MkIwest

18.5

18.5
17.9

38.0

26.0
36.6

35
32.7
131.3

42
39.3
20.0

28
28.4
25.9
.

38
.37.3
27.0

,

23.8
12
11.2
14.3

8.8

'10.7
C01uMn Total

DenverLos Ikngales

most distressed cities, two aro in the South.

Numberbf Prieblems

flow Pelcent

West

New York

are in the Northeast. Bin sigrilfitantly, of the t nc. Region

South

tp

413
100.0

b. Age of City
iumber-Of CR*-Nies

CitietaWith Both High Unemployment
Rates and Declining Population (Group 1)

Philadelphia

I. City 9lie

39

20.1

84

112

141

29.a

27 .1

34,1

5.2
6.8

1/8

108

2t0

toi

23.7

Other studies give much the same results. One recent
report by' the Urban Institute examined' the Nation's I
153 Iffgest cities\on the basis-of five distress indica-

tors: population oss; slow growth in per capita 'income; ,Jislow average per capita income; high unernploement and more' rapid groWth in unemployent. Of 24 cities found to be suffering from all five

zo

102

measures, 26 Were in the North Central or Northeast

29.6

24.7 tregions.

34.2_

70
18,4

413
100.0

Source: HUD, (MOO of the Aplitant Secretary for Policy Development
erttf. fittenorch, 1970., ',:=----'

lieseerchers at the Brookings Institution alSo dwell
oped a "hardship index" io compare cities on six
different eCoilomic and social measures: (1) Ori.

15

.

:..

,

,

.t
,

Vt.

40

\Compared to Other \Hardship Indices. Comppred toptialanceof SMSAowork_loyeland`,Havford
eitltimoru"

Central Cities
422
331
317

tend to be cOncentrated in the _Northeast and Midwest.

Newark`

06.5
76.5
72.6
70.0
62.6
61.8
60.3

Atlanta'

256
246
236

St. Louis`

2,31

Now Orloons"
Gory
Miami*
Birmingham
Youngstown

Rochester
Gary

216
213

Clovolood"

Dayton211
211

Detroit*
Buffalo'

Dotr it"
RIchnhd
o

210
209
205

Jorsoy City

Hartford
Louisville'

6,6
.2
65.9

198
195
189

J2fftlnnoti'.63,5Proy onco

52.7
g2.0
50.9
50.4

Chicago'Philadelphia*
Boston':Milwaukoo
Buffalo*
San Jose'
Youngstown
Columbus*

Miami*
Now Orloarts"

Louisville"

181

180
173
172
1q8
165

Akron

152

1<pnsas City'.152+friringfield (MaFort Worth
Cincinnati*
Pittsburgh°
Denver*

149
148
146
143

While large cities aro proportionately more ser4ously affected by signs ol distress, there ore many
more medium and smaller cities than large cities of-.

fecled by those same distress signals simply because
there are -far more of them. In 1975, almost 40 per.
cent of the cities witli more than 500,000 populationcompared to 26 percent of medium and 16 percent Of
small cities had-a combination Of declining or slowly
growing population, below average per capita InComd,and highfunemployment.

Baltimore"
59.6
58.6
.67112Sprin told (Mass.)
Tampa

Syrarnonto

per capita Income, and 'high unemployment, while
only-eight percent of the "younger" cities evincedsuch a combination.

r 60.3f all citie in the Northeast showed
Almost hal
Nstress An 1916 as measured by all three Indicators
50.0
while 6bout 0.ercent of midwestern and 10 percent
49.3
each of soUthern and western cities showed similar

Grand Rapids

itilanto

60.1

iladolPhlo"C tago"47.1 -

Pittsburgh"
DaytonBoston"Now York-signs.

46.9
46.3

Rochester
R ichmond

Akron.Jhe number of Oroblems Cities face is closely related,to how old 'the' city is as measured by the age trrf its
housing stock. Almost half of all older cities had declinitig or slowly growing population, belOw average

Using an unemployment rate Of greater than 9.6 percent, an absolute decline in population, and per capita inco e level below $4,200 as criteria, one of every
five c es over 50,000 population faced serious problem c ibinations in 1976:

446.
5.82

1.

45.3
' 48.4"Cities among the 40 most populous.

The rec t recovery from the 1 4-75 recession has
reduced to unemploymbnt pto lems for the Nation's
cities. No theless, basic patterns of distryss persist in'cities of all sizes and In each region.

employrhpnt; (2) dependency7persons under 18 orover 64 las a owentage of total population; (3)Iducation-percentage of persons 25 years old or
moreAth, less than 12th-grade education; (4) Rer
capitti income; (5) crowded housing; (6) poverty-

Underfying Characteristics of Distressed Cities
No matter what the size of the crty,-however, somecommon charactertstits among distressed cities- per-Tnrcentage of families belOw 126 percent of lowcome level. Each city was Compared fitst with its
own suburbs and then with other cities. Again, there\4are more disetressed cities in the Northeost and Midwest, though there are some distres;ed cities among
thIttop ten in the,South.

sist;

A Iery large number of the distressed citie'n havebeen manufacturing centers.

The city is old in terms of the age of its residential'and commerial construCtion.

It is possible to Mak? some gveral Observations*-AThe City is land-locked by surpundIng incorOrated municipalities TA cannot grow throughabout this overyiew:,,

annex.1t,r4.

While the pattern of population loss, unemployment, poverty, pod lagging incorrles tends to concentrate In the Northeast and to a lesser extent in (heMidwest, there are urban areas experiencing these
pioblems in every section of the cbunfry, suggestingthat Yegional location is not a cause 0( distress.

The city is Jay developed,
The ,cit* contgOis a Substantial minority population,
Me

One dol the most common characteristics of distressed

Rather, the regional cdncentration of distressed citidS

is instead a reflection of llittory; older inclustrl cit es-------------------

factu;ittip Losses end Distress4

cities is the size of the manufacturing sector in theirA.: 4

CV

kits,

('
*1E8 IN DI TIMM
BY CATEDOMY
f

-#

,

IP.

QIN legrY 3......-....--...-or,All,..,,,,.

-

i,

E Wilbert,

CAowjenYunktos
CmcisgoDuluthnov,etlar'

El PasoMar.on.Uttlytt
Ateandna V.

Hialeah Flo

AlbanyDearborn

I: ormaodua!

Taropa1

Miami
SI Petersburg
AlbucruerOue

Moilik

.

WichdaPortland Dre

Wettn Much

1. OM) Desch
1. enstrio
1. Os Angelus

A44114041

elentolon V.

DallasAllentown

Welerbury Conn
8an Olego
las VeisassFremont Cal
Biverside Cal

muniayille
Parma III
IndePendence

Rockford . _ .,.

PeoriaAils.
.:(Phnom. City

Elagramentd
San Jos*

Fort Wayne

Livonia Mich
Omaha
TtuustOel

Greensboro
llelen)11

MangumCharlotte- N C
Ituntinelon 13/ach

Beaumont
Montgomery
Lubbockgrooms Beech
Newport News
Winston Salem
Columbia 3 C
Atropine,

Grand Banos..

'

Oen thrinardino
Cedar nerndi

llOnOlvtv

I. InColn
TuCIOns

GRP/
311Yannah
YOung %loon

17ernmond

Mastll Cambridge
Phoenix

little Rook

Darden (key*
Indtanspos

Des Moines

Wale

Itogr000d rt.*Shreveport
Baton Rouge
Knoxville

Sall t ake City

ProvIdeOrp
CantonScranton
Milwaukee
TrentonBaltimore

41 I. atLokinglon Ky

Pasectene.

Nee,

Illobset V*

FrininoSan Antonio
Kansas City Ks
Coruut Christi

SlothlunBerkeley, 1 elerde

31 1.0011

Sams
01,10,
Colton
Chan*
a
Spoke
.
Aushr
39'lllVtelO FAQ

r. wo

griam

Worchestar

Plutedelnloo

c11904try Q.

Subset I*

II

spnbobeid Ms

Neshyalli
toorfka

P.11sbur9il

1.0#14.04# 1

Bubroot Is

Minneapolis
St PsolSouth Send
Kansas City Mo,' LOulSoilleStamford
Oaklandban rrincitiCein Akron

IP oboe,* It and 36or
i rTlosysn

New Oddlord.

lityriarltaBli.

,

1

11.9 hntoeu7

Norton.... NMA Y_Olit

SyraCtilt
BeltonCincinnati
r lintStubs* Is I and X....--...,

Uneoeuml
Atlanta
Buffalo .
New Haven
PatersonJersey Cily
tigayeiand
DaytonSete !Men/ I 1.

aubeets I and II

Nwa,kilaillord

Pt.

?

-4.

Abemphis

Columbus Ga
Jackson Miss
MobileJecksonvillePortsmouth Va

Takorna,N.,',...Sa_4890 sot t senttssy Carla oah eopotat.on tfrebeto beloyeo 1970 arol 1970 01 2 wrignInt monobob set 2 enOltOso Cate, wart not cepa. alto...ea loss then thy alltetly oetrateo tn V970
Sob set VA 19050 tutu.. n., unemployment refs treetr 104.1 the hetly averse. ot 1979
Spent. The 1. Oben InIdul0eemployment base. All of the: larger distressed cities
have had recent declines in manufacturing employ-

tt should be pointed out tiat there was a national

ment. The cities over one Million with the largest
absolute Manufacturing job losses ior the period
1973-76 were: New York (15.5 percent decline),

may appear t6 be greater in these ,cities than ;theirlong-term losses. As the national economy improves,
there would be some pick-up. Nevertheless, the magnituA of the losses indicates the seriousness of employment trencli in cities where manufacturing has

Chicago (12.2 percent decOne), Los Angeles-Long
Beach (6.5 percent decline), Thila0elphia (12.7 percent decline); land Detrqit (10.8' percent decline).
Together these losses totaled 410,000 jobs or 59.3
percent of the gross decline in manufacturing jobs
for cities over one million,

recession in 1974-1975, and manufacturing job losses

been a major mainstay in the economic base. The lossof high-wage manufksturing jobs tends, in turn, toctepress,per capita incdm6 growth.
r.

TOTAL EMPOYMENT AND MANUFURING EMPLOYMEO
ARI.4tIGE, 1973-197§;)
Area

United States.SMSAs*Non SMSAr

Total 'nut cturIng 'Change

Olrs'Of Jobs

Percent

000s of J

2,547.0

3.3

1 1C8.0

2.0

317.4
199.4
631,2

0.9

1,429.0

7.0,

SMSAs >1 million
SMSAs .5-to 1 million
SMSAs <5 million
4clata fo.r,?(0Total Einployment Change,

1.7
5.3

tv1§Aa.

Empioyinent a EarnIngs,.tkiptlimbdor 1977. '17-1,112.0-980.7-642.4-218.27, 120.1-7131.3

s

Prent
-5,5
-6.9 4.
Ar

-7.8
-1.0

1

PP

i

f)

#,A1leo of Atenotelloo on the Populatloot of (he Centro Coign el tho 05 lorgatt

Employmont Loam

Final Distrito ai

42

.t.

.

-

11A1 by flet7oft. 1960 goal 1979

(lothoutoth)4

coupled,with the continuing cleManufacturi
centralizetion rretail and .wholesale employment
rocIucef greater losses of revenues for thesealso
cities than dc.s the loss of the same number of services and publ sector jobs. These employment losses
are therefor inevitably coupled with the symptoms
of fiscal dist/09s.

1970.4,1oklin.o.s Wheaten

1060

000uletton
woolying 1970

eoloying 1900

199970 40019

ototootioo

hoonitedes,

hoomlooes

1900 hos leo ion

55 I

58 1

00/

094

094

IS of 10

Rtwooeet l'Attoo
122 Oleos)

199

509

557

20 of 72

Sputa Meeo
12, (IWO)

332

397

347

13 of 27

Wwst Moen

4/1)

/24

7 Of 15-\\\0eti Meer.
405

55 of 5irn

Noe then( Mew.

t 19 noel;tr

Most fiscal problems facing older aistressed cities are

attributable to a decline ineeir economic b
per capitstrise in the demand for public s

kst

Number of citIts

1970
ocepulsoun

110 ohm/

and aSIM, 0s. To
the extentIthat higher service costs requirefJoca fund-U.S. 001,011n.nt u Coolovo(hawk, of the Census 1970 end AC Irt.
ttp. 11 11

nrmh In Moottootifon Amtflco Wallo.rgton ()I. 1 ebtoety 1071 Tohfe

ing, the fiscal conditiorkof the city Ts- weakened.
Local tax revenues in American cities from their own
sources, are derived primarily from the property tat(61 percer4), sales and gross receipt taxes (22 percent), and other taxis , primarily on payrolls andutilities. In a city MT declining population and jobs,
the outmigration of hdoseholds and employers has adepressing effect on the rate of increase in the valueof residential, commercial, and industrial property.
The level of new private construction is low, whilesome of' the more marginal buildings ar abandoned

Annexation has enabled many southern and westerncities to avoid severe fiscal distress and to continue toexperience growth in` city-based employment. Between 1° 11 and 1970, the central cities of the Northeast ad :4 new acreage through annexation, Thoseof the North'Central region gained by 30 percent in/
territory, the West by-Tr.7-)e rcent, and the South by
46.6 percent.

or demolished. Sales tax receipts are lin
to incomeearned; if incomes are falling, sales ta eceipts, particularly in areas where food is not subject to t9is tax,
will also fall. Payroll and other income taxes are alsoment and population loss and fiscal distress of Central;directly linked to income earned. And although unemployment compensation and welfare payments
rise, partially offsetting payroll losses, these are notsubject to local income tax.

/.

Mt Rola of Annixation

areas as it isand yo Cr'''`tteet
7,.11

cities are simply a reflection of the faHure of jurisdictional boundaries to change with the patterns of
economic and social activity in our urban areas.

yses of existing economic, socjal and fiscal
Whilecondition in urban commUnities can provide Lis with. someita sure of current need, they cannot, by themselves, provide a suffident base of intelligence uponwhich local, state, and national-efforts can be based
to guide future development decisions. For that pur_The decentralization of population and ionomic
fiCt Kelly ut o central city areas is a pe asive netional)theTo some extent, therefore, the pr9blems of employ-pose, we must examine the implicatpP
trends for the years ahead,on as characteristic of growing urban
those in distress,. However, in newert *eas, central jurisdictions arepot
rnpletelY Sit rokrnded by incorporated municies. TheseAatt r centre) JurisdictIpns are able totorial expansion through annexentinue their ttion, thereby corporating the new growth and tax
go ith it. Thus, they avoid the serious
revenues t:iscal di ess characteristics of many of the oldere presence of fewer incorporated suburbs
cities,an more flexible state annexation laws in the outh
sternand West has entibled more southern andcities io expand throuci, annexation than the older
cities of the Northeast and Midwest.
For the NatiOn as

whole, there would have been nO

growth in the population of Central cities of the 85
largest standard metropolitan areas Othout the enlaroement of moicipel borders, throutih annexation., A Q,

cP

of current

Ikr?

I

AP

16,

uletweif' 'lc

4,

ia

.4.
*wrioilg.i4

r011111111111111l,:.

14.16 P ---

et' ,i.."- ,411110111r144.
I611-,.,1+!
- : ..: .4-:-: 4 .1' '4191*Pie. ,:0' .4 4 .6..14' di". . i-e. t --, - r ...,Ibr A j....a1

Asir,41, FAR

40%4.7:.

ft""-11'

oak./

.:-

s

_lir, _.c.

...

.

,,,,.

r

/

t, .

4

,10*'

.

:

1

Ntir

A

;.401

-

sft

\

.. wiry A ha,,.11,..
al.14

a.. "I

kif $1.

4 'PI

-

1.0

a

ZrAtnr

1410
.

Ct.

sak
41;0*.

.1,

i

.

'Is

4

.

1. Shifting, Perceptions in be Face of
New Realities"We require-lath an understanding of tho prqsent

44

conditions, as may give-us some grasp of the nomIty
which Is about to produce a measurable influence on'the immediAte future.",Alfred iforth Whiteheadin Foresight 1933

By corn )aring uur perceptions today with those.collimonly ccepted when a groat deal of our present
Ge0

mic and commuMty development legislation

was enacted in 1965, we con sop the laggard inNenceof information on our prceptions and policies.
The Energy Shift.

Our perCeptioncoften lag behind realities. We commonly become aware of trends of fecting the develop-

rr nt of our communitie'j only after they have adv iced sufficidntly far to make their impact only lives clearly felt. By the time we comprehend
th m, they may have already run their cburse andno. trends, still in their infancy, may already be atwork gen rating the n xt set of social and economicd

In 1965, Federal policies trd programs still presumed'the ready rld ilability of cheap energy. ihic patternsof our economic and community development werebased on intonsivo energy consumptiop. We wore
actively discouraging the use of coal for environ-.
mental reasons. And many of the regions of our country with resource-based economies wore assumed tobo the post vulnerable :to economic distas Evenchanges with which ur citizens, communities, and , then, h*eyer, there were numPous reliableorecastsof looming Uncertainties in our energy supplies. They
states will have to co tend. Yet, our lagging percep\loranot taken into account.
tions often underpin the public policies we adopt.
Little wondtr that, with the benefit of hindsight, we
Now, in 1978, we arelttempting to adapt ourselves
later criticize those some eoljcies arid prograins forto rapidly rising costS' for energy and trying to allehaving been misdirec.104-"In as "too little arid too
viate
the nagging dangers of interruption in ourlate."
Growth and Development Issues
As They are Perceived in 1976

As They Were Perceived in 1966-5

1. The Energy ShiftExpensive energy ,Interruptible supplies
Conserve energy, curtail growth in consumption
Resource regions have economic adv4intago
fr_jricrease use of coal to decrease level of imports

Cheap energy/resources
Assured energy supplies
Growth based on intensive energy consumption
Resource regions vulnerable to economic distross
Decrease use of coal for environmental reasons

2. The Poriulation Shift
Substantial population increase must be
accommodated
Educational systemsrmust be expanded toaccommodate post-war generation
Urban areas swamped by immigration ofrural poor
Population growth of largo metropolitan areas
irreversible
NT Migrations out of South to North and WTst

I.

iDramatic decline in population growth rates"0Someschools taut be clOsed. Jobs, housing.
needed fonost-war genkation
immigrations have ende(1`Popkilatioillsgrowth,of largd metropolitan areas,
has slowed or stoopedA

Net migrations toward.the South from theNor.thv)

3. The Emplo yment Shift
ManufaCturing basis for area development
Need to attract manufacturing into lagging
rural regions
t Nd to attractlinereased manufacturing.

Ow. ,$,9uth.,(4hploymtmêtropotitan

Prodoction not major source of rip/ employment
Manu;acturing locations in outer suburbs andand rural areas, no longer in central cities
Northeast hale fferedirnajor manufacturing lo
Nonmetr,opoWn emplpyrnent growing faste
than metropolitan
1T41

sometimes become tomorrow's problem. In 1966,
energy supplies. We Ire attempting to shift towardtxplicles that, will encourage,lower rates otIncrease in 4 many, -called for national policies tklat would encourage distribution of population and economic
our conaumbtion of energy, as well as its conservation. In trying to reduce increasing dqpendency upon
growth in more- "balanced" patterns between urba
imported energy, we are direting new attention toand rukal America end among regionsof the co try.
ward more intensive development of domestic energy
In 1978, instead of finding use for congratul lions
resources, including coal. And now there are concerns
lade toward just suchon the progress that hasconcern over the adthat the energy-importing regions Of the country, an objective, there is legitirnrather than the resource-based regions, face futureverse consequencekof suchitrends for the older urban. problems of konornic distress!
dreas that are losing populatioikand employment.

4, In choosin4Wicies, we should try td base

4,3

The Population Shift

While much of our public discussion and debate in
the mid-1960s yvagP still preoccupied with potential
problems thErt might be arciated with rapid population growth, the postMorld War II baby boom hadcome to an end. National fertility rites had resumed
their historical descent to levels that are today below
the population replacement rate. Now, beause ofthis decline, many of the Nation's urban areas mu§tplan, not 'for the acstustomed populationmgrowth ofthe past, but for t_1/6 inevitable poptririon los7 ofthe future.
In the mid and 181 1960s, ryyal migrations to themetropolitan areas alpng t seaboards and aroundthe Great Lakes wo4 alrepdy dwindling to an epd. even as we w
adopt' /policies intended, in art,
to slow r rtion) the cities and to discourage

decilions upon the longer term implications of trends
rather than upon those immediate consequences weare experiencing at the moment. To do othenNisemondemns us to apprdaches that perpetually lag behind..the very trends we seek to influence. We 6annot
prErAime that today;s kends, will persist unalteredonly a few years from ?low. We do not formulate
foreign policy.or policies for national defense on thebasis of such 'assumptions. We cannot afford todevetop national urban policies in that way.either.
N.

Only_ by focusing poliqies and programs on what wewant our communities to become, rather than simply
reacting to the consequences Of past trends, can we

provide the common framework within Which the.states and communities of the codntry can gain somedegree ot coptrol oJer their destinies.

The social and economic treAs 'of thls decade havein large

profound implications for the future of urban com-

metropolit n vreas. 'Today, much of our national

munities in every sectiZsn of the Nation. As an initialbasis for formulating more coherent national urban
policies, we must examine their longer-range importfor urban development.

the come tration q economic activity

atteltion is being çha v to the reverse of these same
issues: the loss oft poFulation Ad economic activity
many older urbln areas.

In the last decade. Nigrations from the South to theNorth and West wer,-6 already diminishing rapidly andeconomic and populationlfrends were shifting notice-

ably toward the South even as we continued
debate how the population outflow from the Sou
might be slowed. Again, In contrast, our public aiscussions are now preoccupied with the implications
rtthe accelerated diffusion of Population and new
onomic activity toward the South and the Southwest forthe older manufacturing cities nd urban
areas of the North. ,Foresight and Polley I
These contrasts in our,8ttitudes between 1965 andclearlf demonstr 'that:.1978In choosing
courof action, we mustioFenly
recognize that there ar osts as well as benefits. Eachaction that attemOts to deflect trends in one direction
also diverts Ahem from another: Today's solution can
I.

46

./

2. The Conservation Shift: Energy, Reswam and Urban Growth

4Q"Andant, cheap energy has been a decisive element
inihe creation of modern America. Since the industrial revolution, fossil energy has increasingly replaced
human labor in the workplace, supported a growing
population, and led to a spectacular growth in pro-.%War 11,Th combiflation of pont-up housing demand,the baby boom, and a continuing ne9d for low-cost

housing for the rural poor migrating into the ales

ductivity and higher standards of living for Amerkans.Joday, the entire stoCk of capiialigoods fiom
poorly insblated buildings to heavy ahd powerhAl

made fapid expansion of new hdlising in the suburbs
essential. Today, tho baby boom is over and the inflow of poor to tho civics has appreciably slowed, As
the post-war baby boom continues to expand theshare of young adults in the popylation, households

automobiles is tailored to plentiful and Cheap enare0.

will continue to form at a high rath well into the

But the days f abundance are now drawing to aclose, and American society faces sobering new

1980s. These households are already differing appre-.
ciatilly in character from the post-war adult gdnera-

energy realities."

tion, These differences, in com4ination with higfier

19,7 Na Knal Energy-Planhousing costs, are already affecting housing consufnption patterns. 1"

1 It

fa

V.

Past Federal policies have, for .the Mos17part, im- The rising costs of energy, construction, capitalplicitly underwritten the spread patterns of urban dis- gOods, and services are also generating new state andpersal that today are proving more energy consump- .' community attitudes toward the patterns of urban
tive and more costly to 'Service than many commu- growth and development. Thesti changes, in attitudenitiesindividu s, and families are likely to be able to are influenced by several factors other than the newimperatives for energy conservation ani developaffoed in thq9future. Studies carried out for theEnvironmental Protection Agency, Department of ment
Housing and Urban Development', and Council for
Inflation in the price of energy combined With
Environmental Quality have all consistently foundthat the accustomed patterns of sprawl development material and labor COSI rises and regulatory conAmericans have preferred in the past are more costly straints have helped raise the C'CI,Sts of capital goods.
The costs to communities for the construction of new
and wasteful in terms of energy consumption, env
ronmental costs, community costs, and personal c ts facilities as well as for providing services have risen
than planned urban developments at higher densities.

correspondingly. As a result, an increasing number ofgrowing communities are adopting more rigorous
As one study by a University of Chicago team for...theEnvironn4ntal Protection Agency put it in 1974:"All trends point in the same direction: increasing
size increasing dispersion, and Increasing automobile

are producing the very urban forms.and land
use patterns that will increase rather than de&ease
environmental pollution."
These higher costs cduld be absorbed more readilx inthe past because many of them 'Are passed on to thecheap, housing costs as aenvironment, energy,,,,k,iproportion of income wer. e lover, economic grewth
rates were higher, and inflation was consuming less ofA
our purchasing power. Additionally,`following Wori9

policies with respect to the construction of new facilities. And in urban communities where economic andpopulation losses are occurring, the financialocipacity
to provide even basic services Is dangerously eroded,
Capital expenditures in such comfunities have been
cut back steadily.
4With the adoption of the Environmental Policy
Act of 1969, the Nation, states, and communities are
new committed to balance theirgrowth and develop)
ment against needs to protect the quality of iltie 9nvironment. In many of the most rapidly growing sec-

tions of the Nation, the accustomed patterns of
spread development not only run oRunter to the pimsof environmental protection, but in some instances,

Changes in Energy Prices Relative tocome and Other Price Changes, 1950-1977
Percent Increase
In Pr Capita Opposable
Perionsl Income(Current dollen)

Priod(1950- 01,,,

1980-70
1070-77

(

43

, 80

4cono4'tc flopol1 of INF Promfoot'

Prcnt Increase

Percent ),ncresise

In Wholesale

In Price of Consumer
Transportation Services

Pric of Fuel

19

,32
327

52

Percent Increasein Price of
Housing-actually jeoppardize long-run public health and safety.
In Such arees,,far-rviching state and local land andwater m'anagement controls have been enacted that

attemptto control the dispersal of urban develop
merit.

In some regions of the Nation, the competition
between urlian expansion, agriculture, and energy
develop/lilt for 6ons1rained supplies of both swine

and undergrounti water require difficult trade-off
decisions and carefully controlled patterfis of future..
development.

prompted a number of states and communities invarious parts of the country to attempt to manage the0003 of urban develoOrnent in Order to tnOre rigorously control increases in the costs-of public services;
provide for more predictable scheduling\ In the construction of streets and utilities; 'conserve land,

The growing importance of American agriculture
to world food productioe has renewed regional andnational interest in protecting prime frirm lands fromenergy, anel capital, and protect the quality of their/urban encroachment.

Many growing comrounities are now attempting tocarefully assess the fiscal, economic, environmental,
and energy impacts of developmnt in advance -of is-

Monaging trbon Growth47

more orderly menagement of community expansion,
In many parts of the Nation, expanding urban communities are no longer viewling growth as an unalloyblessing. The fiscal fart environmen1 I consePed
quences of haphazard urban developm&t t have1.

environment.

suing permits. California legislatl n enables cities andnew, construction will Ontinue to be reeet a substantial portion of the Nation's

ObviO

quiredresidential and economic development needs. In thosecounties to join together in determining what areas

around the urban periphery will be serviced andbrought into development under a carefully phrased
urban areas where immigetition requires continuing i 'schedule of.development. This attempt to providVor
addrtions to capital stock, new construction on the we orderly development:forov.idesgrrater.urban periphery is not only unavoidable, but essenih urban development and helps reduce thetial,
costs and inefficiencies that are essociateZvith hap'hazard spread development that has plecathe comEven in-such instances, however;there is a shift in munity at the mercy of uncoordinated private develattitude away from "growth at any price" in favor of opment decisions in the past.
CdrAUNITY NVINONMENTAL COST ANALTSISCOMMUNITY oonECT COST ANALYSIS

0000UNI16

to Imo uNII

t...

10

i

Mfteft.S.

zr...
MftftSmie

.

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90
...

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.

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rr
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......-. ,-.....1.......41,1....,...........71...."P"."`."6"'
Mk---*...

I

1.

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IWO...A.

,....

" 424.4IC WM, ........... , , ...

p.

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.-.
KA0.1110001011MMT#014 q.

P.111

MON% NW.
1011401.

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ee
.

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70

.

t.

'..,_S...

,..............,.,..,

It

i

60

.---1--.........

.... ...................

P013.1.11.1. NIS *FROM PRIVATE AUTOSPOLLUTANTS FROM RESIDENT 1.41, NATURAL GAS USE
VOLUME Of SEDIMENT PROM EROSION

1111k1, POLLUTANTS ?ROM STORM RUN-Off
WATEINSE

ENERGY UST

.^"'"

.

...-

e

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Such attempts 'to manage thatpace ond direction of
eir problems.
brban expansion are not with
They result sometimes in rapid crejlt In housing tkause,,711- restrictions on supply ompored to
end!thus squeezing more modest income pur.
dchasers and renters out of the locat housing market.
They also occasionally eive rise to basic constitutionalquestions. Do such attempts by communities totrolAheir rate of growth interfere with -the right oflrav lor example? Or do therfance off some jutis.
dictions from low and moderate incOme.Individuals
and families?

II

No clearer exarriple,xlsts of the conflicts and trade
offs involved irrtfrfian policy objectives. Short of thelegislatures and courts, our communities and states' indeed, the NatiOnhave lacked the mechanisms andpublic tirocesses required to weigh these conflfcM
carefully and to reconcile them. Now some states lind
localities, in pioneeri9g Is!islation, are attempting to
put such mechanismi: :O cedures Into place. Suchef forts will have to become we widespread as a new

Urbanization end Water

Still another difficult set of trpcle-off decisions insorte regions involves water. In a large.portion of the

miAt rapidly growing section of the United States,
water is once again emerging as a serious Constraint
on future development..Major Federal water divor-sion
projects iroho past have made the rapid urbanization
and agricultural development of this drier quarter of
the Nation feasible. Urban expansion In some areas,has intercupte41 vital acquifer recharge areas. Somecities have been forced to purchase large tfactS ofundeveloped land in order to ArCure water rights. Urbanization in the Syuthwest has imposed critical burdens on ground Water supplies beine mined throughpurping. If continued, ground watill sOurces will
eAntually.-decrease to the point wherd It Is no IongerVI
economic tb use these sQurces. A similar problem occurs in areas whore ground water aquifers are adjacent
to sea water, as in South Florida. Purtiping from thesesources, at rates excePling natural or artificial fresh -water replenishment, ultimately allows intrusion ofgeneration of growth anddecelopreent issues emerges
for each section of the country.

salt water and contamination Q the aquifer.

Protecting Iim.4gricultur.I *ottransfer water f.m are

In the past-the .,,eut ion to such problems has been toith more*bunr

nt sul5- \California's urban development legislation was to help
prcitect some of that State's prime-aerjcultural lands
frOm urban encroachment. Nationally, there are con,ly in terms 0 capitalplies, These solutions arandare increa gly sloband operating expenditur
aints
and leng y delays.
ject to environmental con
tems
we reachine, a level
Some of Our major4river
ondwhich large investof optimum development -b

flicjing_assessments over the significance of urbaii

ments yield smaller and smaller retucos, .

1

For examO0le, re of the Original mot ivations behind

7-area expansion in the loss of prime agricultural lands
lost to production.
While one panel of the National Academy of Sciences

concluded that combined with water and enerdy
costs, the losses Of agricultural land to urban growth
are substantial, another prel of the Department ofAgriculture came to a cont'eary conclusiOn.

r

Many water diversion projects are Federally financed.
On behalef of the.taxpayers of the entire Nation, theFederal government has a direct interest in encouraging-locaf patterns of resource use that do,not impose extraordinary burdens upon the Federal Treasury. The states have jurisdiction over the Institutionalarrangements governing resource use and the prices.

charged for common property resources Such aS'
Nationally, the annual loss of cropland to urbbrwses . groundwater. Only %Trough cooperation between theis 300,000 acres compared .to a natirARotal or400 Federal government and the stoles, therefore, canmillion acres in cropland in 1973. The 'rate OtZonver- means be found- to resolve the difficult trade-offs
between-conflicting demands and escaleting needs forsion for urban development, herefore a .unts
deC=',
t.
:1
cropl
less than 0.8 percent of oatidni.s prime
r ,0de. However, a large sha o
4

Pluntry1s urban a4eas.
One Department of Agricultur. sarnple of 53 Cowities'agricultural land adjoins t

Indicates,that almOst one-third .f all land converted
to urban uses 6etween 1961 and 1970 COMO from theprime classif ications of' agricultural land. In the West,
percent of land converted to Urban use was agricultural; 64ptycent in the Midwest; 31 percent in-the
Nortbeast; and 16 percent in kfle South.

lnbct,, areas as the 'Higti; Plains and some of theinter-moXane basins, - such decisions will be particularly crilical In the coming years. Groundwatersupplies are alr'ectdy. being rapidly depleted, threatening the viability Of agriculture in some of these areas,
Intensive developmei)t of coal and shale resoufces insome of these same areas will initgose ixtraordinary
new burdens 6n the'already scarce supplies of water.
This will have significant implications for urban devel-"opment,

I

et

.,

Resource Deveiopmelit Towns

for ppblic \/4-vices adequate to the needs or the incomihg workers and their favilies is a special problem.More'lnAstve developmentzof domestic' energy resources, in ordbr to reduc "bur dependency on im-

for states and counties.

ported fuels, will hav.pro,fbund consequences for the
future development df ery region and community
in the country.
7'

Since much of our future energy development may
take place on lancileased,from the public domain, theFederal government has a direct interest in minimizing inefficiencies and unnecessary disruptions

One unique dimension of fqture urban polidy must
dial with the problems some states and local areas
Will confront as die result,o'f an influx df new population cbminci to develop energy resources. This new
growth may occur- on the site of an existing %mall
community as, for instance, in°a egal wining area ofAppalachia; or a new community .mayle required in

p

.

49

caused by boom/bust development. To a large extent,

however, the establishment and operation of a newcommunity Is a prime responsibility of State geverriment and the local government that it has established.
"However, since the Federal government itself plays akeyrole in determining where such development

aversely populated area of the West.

takes place, it has a respqnsibility to work with state,
local, and private interests in ensuring orderly development of such communities.

The construction of such towns has been a colorfulpert of our history in the past. Lumbering and mining
towns flouriShed and declined in the Upper Great

Conserving Urban Investment

Lakes region as the resources on which they depend-

As the costs of capipl goods rise, so too does theed were exhausted. Mini9g towns in the Mountainreplacement value of existing capital stock. In manyof, the nation's urban areas, both land and facithies hestates and Southwest flourished briefly- in the ,ABOOs. as lodes of silverand gold were exploited.

idle or underutilized while nearby, now facilities arebeing constructed, frequently with Federal assistance,'.. The -problems of sail communities-tat* are differ- ent Irt character than in earlier periods-of our notional e.clevelopment. Pdie service requirementland
expectations are mucli higher today. Good seMols,*roads, sewer and water-systems and police and fire'
protection: are Oxpectea by residlints in such corn(munities. Tte durability required today of structuresthat duplicate that which already exists. To the ex;tent that existing facHities can meet ithe purpose andare serviceable, such a practice of "throwing away"
urban investment is no-longer justified. To the extent

that Federal pblicy inadVertently encourages-suchthrow-away practices, it must be mOdified.

such as toads and other Public facilities compared to

In many instanceg, savings in both enerby and capitalcan 'be realized ihrough the conservation of existing-tho s of resource.bdbm tdwns in earlier years'imposes

longe -term

responsibilities ,nd financiny reqUire-rrr s on states and local jurisdictions.

,H§

s'Mall established communities, experiencing rapid
popuration growth as te result Of resource.cleyelop-

urban investment.
.

.

t

In attempting to improve the utilization bf existing
investment., the over-all result should Ultimately be,.$ment face two probibms: first, temporary peak.more compagOess diffused, patterns of urban develi
opment that incur lower transportation costs, lower

deMands.on pUblic services strain existing capacity.
Peak- demands may not riarrent long-term fixed in-

spread development of the recent post. SNiudies haver-.', vestmehts and rapid population growth may not .
*vote a sufficient increese in the tax base to finere peak level increases in psublic seMees.

;i9rid Problem is the Clash in lifestyles between:astaOisfrAd relkOnts and ,ffie incoming Roibufration.
Sp6al P'roblen'is arise over both small and iarge

heating costs, ,tmer energy cosis than the urbah
consistently found that -the amount of gasoline consumed per capita decreases as populatiog density increases. The same ;.esults bbtain ès jobs, shopping,.
and homes
are closer together.
,
*' .

t

issuesnighttir.vieAtertainment: loss of small town

It should not be assumed, however., thai these findings implicitly favor ,the develoVent of large, highly
dense cities and metropolitan areas. Some resefirch'-aitierliti4fd 6 T nir residents, and in mem? caie's .thefinds a decrOse in-Per capita gasoline cbnsurriPtion asenvironimental c anges that accompany resource :develoPrrienis:

metropolitan size decreates. And while high-rise andmql,ti-family units require .relatively less energy forheating and cooling, it cannot be automaticalh7 conResoutte towas ,,,sthat are .gstablished whete no pre.' -.eluded that the larger the ,unit, the= less enel-gy rbViqus. town%eaci ecl efore are é speOal:"'quired. Test results have shown increased therrval efvieb)e focal
iticRetiohathe'finanoing of fkifitles;- f3ciency in buildings of up to ten stories compared to

-

.1

_

single-family housing. As buildings rise above 50
stories, however, the Inc ased energy necessary for
general services, such 9S levators2overtakes energy*

growing inciden61 of safety problems, Correcting
these deficiencies and other cecessa/y road rePairs
will Cost $300 million.

I.

cost savings.

Many' of the natiOn's 40,000 existing cOmmunity

Nor may it be assumed automatically in every inwater systems cannot meek the standards contained instance that the renovation or modernization of exist-

the Satg. Drinking Water Act of 1974. A signifieantingnuMber Of these sYstems ore very old, sUbstandard,facilities, will invariably cost less and ,,ittilo ingreater energy savings than would hew construct n.
Much of our older housing and many of our existing

urban facilities are highly inefficient in their use ofenergy and modernization may, in some cases, beunable to melit peak demands, 'Officials in
RochesteCNew York, estimate that $133 million will
be required' tO bring .that community's water system
andinto complivai with the Act.

more- expensive than replacement or new construction elsewhere. Careful assessments of these trade offs

will be essential in the future.- -Unfortunately, how-,ever, there is virtually no comprehensive informatipn
about maintenance, upgrading, ancP-rePlacement

nteds of Our existing urban facilities nbr of theirpresent quality.

,-,.

The most disturbing development in.many of the nit
tion's older urban areas has been the ,trend toNNfard
substantial retrenchment in expenditures for capital
investment in and maintenance of physi.cal facilities
in the face .of rising pperating costs and tax basedeterioratkin. One Ur6an Institute researcher reported to the Joint Economic Committee that state andlocal government spending for construction, repair§,and acquisition averaged about 29 percent of stateand local budgets 'between 1960 and 1963. By 1976,
that spending had dropped to 16 peraint and it ap-,.

statevfound that mosii Federal grants-in-aid for capital facilities are unreTponsive ti4 the needs in older

urban communities and implicitly favor new construction. The twd largest such Federal aid programs
are assistance for wastewater treatmdnt, fdr which
there are 46 separate g' rants-in-aid, and the Federal
aid highway program.
The single largest capital expenditure need for federal
assistance. found ill that survey was for the 'Modernitation of seweralge systems. Because of' the age of
wastewater systems in the oldes central cities, statewide average costs for .meeting current and projectedlevels of service as well as the mandated Federalwater
quality goals, are' far higher in those sections of thecountry where the concentration of older cities is...

pears to have contimied to decline' in 1978. Fifty

high. For example, per capita total costs for providing

citiesksurveYed by the Joint Economic Cbmmittee'reported an av rage capital need per city of $450 million ,to -m
In, upgrade, and construct streets,roads, sewpublic transportation facilities, andpolice station

mandated levels of system capability for the 1975
population are 50 percent higher in -the Northeast
than in the remainder of the country. A portion of
the cost difference between that region and the restof the country is attributable to costs for combined

A number of 1977 surveys found that one of the&Mier overflows and costs of major rehabilitation. Yet
currento Federal grants-in-aid for wastewater treatment are heavily.weighteck in favor of construction ofmajor deterrents tp economic development and private investment In the older cities was the declining
quality of physical services and facilities required toservice firms and their employees. Deterictrating sidewalks, streets, water and sewer systems were actually
responsible in some, instences'for private decisions toleave the city.

Xs existing urban investment grows olde,r, public
safety Is imperiled and the costs ofrepair and repla
ment rise, In 1977, the Depart nt of Transportati
reclassified -many urban roads On streets previously

only "fair".or
designated as in "good" condition"poor." Vital bridge links in major hig ay *systems
are also a growing problem in so-me areas. For ex1

One 1977 general survey of corficunity and eco.
nomic development problems in the northeastern

new facilities rather than renovation or modernization,
Public facilities are only one component of the tal
physical assets of older cities and inner suburbs atare being underutilized or abandoned in favor of new
stryittures in newly developing outlying areas. owe?
hAsing and older comrpercial and industrial struc'tures are a vital component of the existing stock of
capital as well. In sPe instances, these structures
end must be replaced or
may not be fit for futur
demolished. But in many in ances, they can and arebeing converted to totally new uses unrelated to their
original purpose.

ample, Pittsburgh and surr.ounding Allegheny County
sharp about 1,700 bridges. By 1980, Over 1,000 of

9Ickmills are being copverted into commercial cen-,,these bridges will be more thar 50 years old Witea

refs, o56

dings, and new industrial uses. Some-).3. The Population Shift:Vorkers, Migrants,'and Households
Ifft

are being adapted to community and cultural use.

"The attors behind the prevalence of metropolitan
lorrodecline are three.; changes in the rate ofnature Increase, changes in the net migration into

One entire mill district of Lowell, Massachusetts, hasbeen designated as a National Cultural Park. Several
relatively small lfederal grant prbgrams have had an
encouraging catalytic role-in such developments. But
the preponderant bias in existing grant-in-aid pro--grams does not -favor -the recycling -of -existing invest
ment.'\Popkilt

andof metropolitan erels; and migraibry ex-changes between metropolitan areas. Of these, thestrongest is the decline in the rate of natural increase
which -has resulted fromi the -drop in tpe birthrate.
Whereas sin the 1960s, OA natural increase Of metro .

politan areas stood atp 1.1 percent per year, in the
1970-74 period it amounted to .7 iercent and underunbalanced. favoring . new housing construction.6 percent in recent years. This flaunts to a drop of
against rehabilitation. Now as the economics of re- .5 percent In the rate of population growth tram thehabilitation steadily improve in the face of rising conlast decade to the aesent: The net migration rate
struction ants for new housing, greater emphasis isfrom metropolitan to nonmetropolitan areas was unbeing placed on re4bilitation.
der .3 percent in 11975-7(3; it had been between .1
percent and .2 percent in the othbr direction in the
But thehabilltation bf 'older housing stock will
1960s for a change of 4about .4 percent per ye r...
depend' in the final analysis pn the tastes and lif?- \ Whilese numbers are comparable, the drop in t
styles of individuals and bou3eholds. Projecting thencrease is larger and more important than t
trend of such subjective and personal preferemces is a \wein metropolitan migration. At the same ti
risky necessiti/.
net migration from abroad has continued at a sUbstantial rate (about .2 percent for net lemigrationand perhaps as much for ill
I immigrat104/

tjntil recently, natIona) housing policy was

vily

I

t

Professor Willianit Alonso,
tvard University,
Iry Hearings on How Cities Can Grow Old Gracefully,

CommittrOeBanking, Finance, and Urban Affairs.of the House Of ReRresentatives, December 1977(

In .Its early and mid 1960s, there was some p ilicconcern over the perceived naiad to accommoda
rapidly groWing national popult2tion in ouf urban
areas, We were still engaged in expand' g our schooland higher education systems to ab b the dramatically incraased flow of students fromf the post-World,

Warl I baby boom. The influx of bla and Hispanic
minorities into the central cities combined with the,1111rr

natural increase of those already in the cities had con-

ii.

'

V

4

Inued totreselt in populatio growth for man enftral cities and inner suburbs. Many expert ob' Were insisting that the growth of our)argest letro--

politan areas was irreversible.

As we now know, even then the underlying realities
ivbur national life were at variance with these per6eptions of the time. In 1978, the trends with whichft

we are concealed are very different.

Migration and Community Growth1

Because of our 6resently very low rate of natural pop-

ulation incr se, it is noXr imvitable that migration
will be ithe dcJinant force determining both population growth an decline in communities. Arithmeticaily, there can e N. other result unless rates offorelq6 immigr Oth radically increase and the imL4Tri ute themselves in such a way thats °Yr), igra
'Y

t

Is

52

,

Many communities and urbtri areas must therefore
now plan for population decline rather than population growth, an dnaccustorned challenge n theStates citizens have been unwilling to perform, The
potential significance of illegal:immigration for receiving urban areas Is still uriknown. Regardless, it isthe, decline in the rate of natural increar in popelation, migration between urban areas, and the changing age structure of our population that has the rliost

United States.

profound import for the future of -urban.commun,

they counteract the consequences of migrations within the countrya highly unlikely possibility.

Ries.

414'

Of co l,t\* populationOecline need not be a major
community!, or 'areaip,roblem --- indeed it can be con,verted into ay. opporiunitYunless It Is so rapid andso hig`lkly selective:that the losing cornrnunits growincreasingly yooret and older compared to The areas
gaining immierapg. Ekrt iselective migration is precisely what is haOpening in many of our older central
cities and Inntr suburbs.
Migrants t'end to be persons with relatively good em-

ploYrnent prospects. those leaving pre likely to be
more highly trained, employable individuals. The
population that remains contains an increasing proportion of the poor and unemployed. Furthermore,those who do &love into areas losing population havea higher probalAity of gettinq the j bs which tre

available than those already there. Consequolitly,
migration does not provide a smoot means for communities to adjust to shifts In popule Ion ald employment. The result' is frequently communitie, in distresscontainivRpeople in distress,'ilks 1As the,,,,x9nomically
better-off move out of the central ally, it grows proportionately poorer relative toits own suburtif and the,est of the country. In 1970,
it is estimated that 12.4 percent of-families in c tail'cities had incomes below the poverty leve4 y 1 76,
that proportion had increased to 12.8 percerk. l thesuburbs, the proportion declined during the'p nod.
from 6,6 percent to 5,9 percent.
,.

.

Populatioii-Shitt,rd the Labor Forcehroughout the 1950s and 1960s, the Nation's statesh the need to accomand communities were f,modate a large increa in the number of children in
Ole" of population Is passour popyletion. Thatroups and into the,young!rig out/of theesthoo

adult age cohorts. S. oo enrollments are *dropping.
Some communities ar closing schools even as others
In the path of migration are forcea to build new ones.
During this decade and the first half of tpe 1980s, thechallenge has changed: to absorb the young adults ofthis post-World War II generation into the Nntion'slabor force.

The 1960-1965 national labor force grew by 1.4 pcent annually; between 1 a65 and 1976, it grew
2,3 percent annually. Teenage entrants into the lab rforce Have grown from 3.04 percent annually from1955 to 1960 to an annual rate of 4.4 percent bk.
tween 1965 and 1975.

adults to theThis increase 4n the addition of you
by a raAlly
work force has been ftirther augmen
rising rate of participafion by wOrne in the job mar.
ket.
We'

The 1178 Economic Report Of. the President points
out that In 1956, women comprised 31.5 percent of
the adult labor force rid 31.3 percent of adult em-

Foreign Immigratiorukto the United States continues ployment. But by the third quarter, of 1973 theseatja consistent rate ar!I at a high level !Motive to that percentages had %en to 38.4 percent and 37.9 perfor other nations. Much of this foreign immigration cent. From that period tO the fourth quarter of 1977,
mOves Into metropolitan areas and accbunts for a , employment of adult women increased by 15 percent
ctinuing positive flow of immigrants to metro-compared with a five percent incRease for men.

litan areas iri general. But the magnitude and conuences of illegal immigration are much, more dif- With more womeryctn the work force and, iyjnanymen being the ssle adult tythe
ficult to estimate. Since many undocumented work- cases, with theers come from Mexico, theY have tended to concen- fora* day care Services are increasingly critictil.
trate initially in the West and Southwest particularly Some fen)ale family heads have beeh ill-equiiiped toin agricultural areas. DesNte this, over _ 1 ill' of all II- participate in the jo market, The problems of corn-,(legal immigrants are now !lid* to live Isewhere In bining parenting, jo tralhing, andrreoyrnent forthe country, including an estimated one-fourth in displaced homemaker re growing more significant in
New York. Most studies of illegal immigrants find many urban labor markets.
them to be young. Most start out in agricultural t :lbs.
Two attempts to replace#undoCumented'workers ith The ektraordinak growth in the labor force resulting.citizens in specific jobs haVe been unsuccessful, indi- from increased partiOpation bawomen and the large
cating that they ere performing jobs that most United number of yoting ftØult entraits, comes at a.,time

/

),.,

An,

"s-1

(

.1

\

when national economic growth rates are considerthe 19t0s end 1960s,
ably lower than they were
Nonetheless, more than four .rillIon nety jobs wero

Nation, for comnlunities where such unemployment isconcontroted, and for OA young unemployed them&elves.

eated in the country last yearan alltime recordnd unemployment was reduced by more than one
million persons,.

Other Implications of the Population Shift.

1...Tx)r Nr PNI.Ctplitqll Nor by trirmai Suwi on4
Si. 1911 to leAs the post-war generato moves into the adult age cohorts, thrie are many ramifications for the Notion,
the states, and communities.

Past research has found a strong correlation between

crime, youth, and idleness. Providing that full employment can be attained and solutions to structural
untMployment succesSfully implemented, it aPpears

highly probable that crime rates that hove so adversely affected the social and economic life of cities
and older suburbs will begin to decline.

AS 'young adults born during the post-World War II.baby,..boom move from school into the work force,the reltive size of the population, yOung and old.
dependent upon breadwin lrs in the working adultage groups will also declir . The 1977 central citydependent population wa roughly 24.6 million, ao million since 1970. The
drop of approximatelBlack Teenage Unemployment

Desptite,this progress, the'economy is not absortirng

all ,the poteniial young entrants from the post.war
bal4 boom. Teenagers comprised only 10 percent of

the labor force in the,fourth quarter of '1977, but

suburban dependent population also declined In sireduring the 1970s, losing about half a million people
horn its '1970 level of 32.5 million. Hence, while thedependent population has declined at a modest rate
in both areas, the wage-earning population increased
significantl*n the suburbs while Temaining.at about
the same level in central cities. In Suburban areas thewage-earning group increased by .119 million (20 percent) from about 40 millionth rOughlY SO frifilion. In
central cities the wage-earning populption remained atabout 35 million.

theV accounted for 24 perceRt of all the unemployment.

Of course, in the latter half of the 1980s, these same

shifts in the structure of our popplation will create
Black teen),!:rs appear to be 'the leading victims.of Thew challenges. As the numbers of new entrants into
the work force decliRe, labor shortages rather than
this youth unemployment. At the peak of the 1973
labor surpluses may beour concern.
boom, the employment-population ratio was 49 pert
r-3enf for white teenagers and 28.2 for black teenagers.
.
The population bulge created tiji the baby boom
tThe ratiOi fell to 46.2 percent and 25,1 percent rescoupled witti the projected continuation of lower
pectively in the trough of the 1975 i'ecession. From1975 to the fourth 'quarter of 1077, the employ- birthrates will also create a succession of Prqblems fcir
the Nation's institutions as this cohort mols throughment-populat ion ratio for white, teenagers increased
the age cycle.
'
to 51.6 percent; but for blacineenagers it continued
fall in 1976 and did notincrease until 1977. Thus,
Future shifts in the age distribution Of ihe population
white teenagers arp now dbing better than at the peakcall for new thinking on how the Nation delivers critiof che last business cycle, but black teenagers are
doing no better than before the current upswing cal public and private services. In particular, thedesign and location of buildings might incrteArs ly
began. Thiis situation appears to apply whether black
include consideration of future cOnversion to 01 h-67youth are in the central cities or in rural areas.
uses. Facilities with rearrangeable intalors is one
Whei-eNter such youth are concentrated, however, thealternative.
Building systems which cari'be dismantled
tiroblem Of black teenage unemployment is a socially,
-4)
foeu
the
may
be another.
resed
and
as well as economically, pressing problem,14. The Lifestyle Shift: People, Places, andMousing"We are In the midst of an all time high in household
formatimtrimulated by the post-World War 11 baby
bOOM. ThiS Is cottpled with relative increases In small
Public schOolsystems, hospitals, old age and ni4fXng households caused by changes in ego profile and lifehornes and low-income housing ore examples or style, factors embodied in the planner's concept ofservices requiring greater facHities flexibility os a headship rate or household incidence."
result of future populotion shifts.
."\ Roger Montgomery, Professor
Thus opportunitieL for dational urban policy ore of City Plenning, University
opened up for the next seven to ten years that will of California at the Citizens
differ from tbose that will be ovailable in the Ititter 'Forum'in San Francisco,California, June 22, 1977
half of the next decade.
Such design changes would help hold down the costsof public services in a futureenvironment of fundamental demographically related demand changer.

-

Increase in the Number of Households

Lower fertility rates and lower dependency ratios,

Not the least of these potential opportunities is thefact that, despite declining population gwth rates,

combined 'with increasing female participation In thelabor force and smaller households, signol changes inlifestyles with significant potential consequences forthe nation's communities and regions.

the rate of the nation's household formation willremain high into the latter half of the 1980s when /tonumber of younger new ,households will begin to -From 1970 to 1976, the U.S. population grew by
decline as the post-war generation passes ,into the slightly over five percent. Total households grew by
15 pet:cent. The number of households consisting ofolder age levels of the population.
adults and children grew by nine percent. HusbandIn the meantime, the high rate of new entrants intl..) wife families grew by only six percent while singlethe household-forming Age groups has combined with parent families headed by a male grew by 16 percent
a persistent decline in, the size of households froth and those(headed by a woman grew by 33 perapent.
3.67 persons per household in 1940 to 3.36 in 1960 Tfle nOmber of households consisting of adults 5Ione
to 4,14 in 1970 to 2.89 in 1976,11nn new, smaller increased by 38 percent and the number of househouseholds are,profoundly difierent from those in holds consisting of unrelated individuals increased bypast decades. They signal one aspect of the third 67,percent;important shift in our national life: the Lifestyle
Shift.

V

Popttlation(Projections ofter 1974°)

141V:i2 -Number of households

t 2,5
2,q

1.0

t 0.5

1Annual growth rates In population and number of households,
1940 - 1974, and projections to .1990°Population proi*criont Census Series II
Hovssthold eolectIon: Census -Series C

SqLtrcet.tl.S'..15orpau of h Census Current Population Report+,
Sorters P125, No, 601 and No, 607

60
.

.

ft

From 3,965 to 1976 the proportion of white house-

this in perspective, it took 100 years(1790-1890) to move one- and two-person house.
htrids from 11.6 percent to 16.8 percenta change ofholds headed by women has grown from 18,4 to 21.8

6.2 percentage) points, or .6 points per decode. In thepercent; for nonwhite women the proportion has
risen from 30.2 to 37.6 percent of the nonwhite

next 60 years the percent,* rose to 31.9. for a gain

households. The number of female-headed families is

But in the 26-year period 1940 to 1976, the per-a riSing fraction of families. In 19M, 36 percent -of
black families were headed by women compared to
11 percent of white families. Hatt of these black
female-headed families and 26 percent of the white

Cohtage pOint gain has been 19.3,-or eight points per
decade. And the end is not in sight."

ones were below the poverty line. This averages out
over the U.S. population to nearly one in every threefemale-headed families being below-the-poverty lino.
With more women in the work force, and, in manycases, with the, women being the sole adult irr the

project tho implications of this changing household"To put

The Changing Rolsof Women

family, day care Services are increasingly critical.
Some female 'family heads have been ill-equipped toparticipate in the job market. The problems of combining% parenting, job Veining and employment for
displaced homemakers are growing more significant inmany urban labor markets. This has been a decade oftransition not only for cities but also for the individuals end families within them, The changing lifestyleof women has played an important part in this transi-.,tion. The improvernent of cities and the quality oflife will in part be determined ly thtnature of adjustments to these trends and by the fresh Insights
women can contribute.
The Changing Nature of Householdsof 16.1 per contege points, or three points per decade.

A Departmerit of Agriculture study attempted tostructure for housing and concluded that one possible
series of developments would be that a large demand
for multifamily units and mobile homes will continue
into the early 1980s. The study speculated that overcapacity In apartments May occur by the late 1980s

the number of households under 26 abruptly
declines. During the next ten years, the estimate
anticipates a considerable Increase In demand forassingle-unit structures; at firstin the moderately priced
ranges, later in more expensive housing.

Other forecasts anticipate the possibility of a strong
decline in the- demand for the single-family detachedhome during the next 26 years, estimating that suchhousing will come to total less than a third of new
housing starts osier that period compared with Over
half of all new housing In recent years. At present,
however, it appears that many Ayoung householders
are purchasing homes earlier in !heir careers than has

been true in the past,' partly to avoid still higher

George H. Brown, formerly Directil,of the Bureap of
the Census, has observed in a summary-for_the tonference Board,that, "Not too long ago it was cuVomr
bry for unmarried personsbe they youngsters, oldl'ters, spinsters or benedictsto live in someone's
household. For years, this custom has been slowly
changing, but it is currebtly moving at a revolutionary
rate. As the following table indicates, the change inthe percent or households occupied by One or two
persons waS greater In the six-year period 1970 to1976 than in the 10-year period 1960 to 1970.

housing costs In the future.
ty.

Projecting individual and family tastes is a very risky
undertaking. Preferences change easily from decade
11:1 decade. It does appear reaSonable to assume, how-ever, that household behavior in the future will beconsiderably different from what we Mve 'known In
the pagt, partly because of the changing social champter of households themselves, partly because of asteady rise in housing costs.

Risini iusing Costs and Minorities

National and Metropolitan trends in housing costs
from 1974 to 1976 indicate thtl'more households are
ffncling it necessary to pay greeter shares Qf their inPereentage,Polot comes for housing. It has been generally assumed that
Change irons
about 26 percent of household income is an approPrlot Pdod
priate.al location by individuals and families for shelter.,
An increasing percentage of American households ispaying more than this share for its housing. And the
7,8
1.2
impact has been more serious for central-city minor.
4.9
ity residents than for the population at large,

and Two-Person Households

.

Yee,

Peroontel ANHouseholds

1940

31,9

-1950

39.7
40.9
45.8
51.2

.40196°1970
1976

5.4

In central cities, ln 1974, about 70 percent of all$ource.;The Conference Board.

households paid less than a fourth of-Monthly income

866

for hOusing. By 1976, the irercentage paying th.aramount or less had droppedi to 66 percent. Amonghouseholds with annual incomes above $7,000, approximately 60 percent of all minorb households
rind over 70 percent of all nonminority households

whites, low rotes of central city selection of suburban
whites, and generally, stable rates of white inmigrotion. The only evidence of a chonge in trend is thoslight decrease, in 9 of 11 SMSAs, in the rate at
which white central cp movers leave the city for thepaid a quar-tor or less of their income for housing. By
1976. the share of both populations paying that share
had deClined by several pereentage points.

subur bs.

[vidence of increased central city attractiveness,
however,.is more pronounced among the important

young adult group, aged 20-34, than among all
Thus about 40 percent of all minortty households arepaying rilore than an appropriate share of householdincome for housing. Furthermore in control cities,

whites. Above-trond increases in white inmigration
rates for those aged 20-24 are found in 7 of the 11
cities, along with a continuation of rates greater than
50 percent in Atlanta and Washington. Central cily

from two-thirds to three-quarters of all 'minority
households are renters and in 1976 over 80 percent of
all low-income central-city renters were paying morethan 25 percent of household incometifor the same

retention of movers in those 'age groups has also Incrdased more since 1970 than for whites of all agessummed.

pur pose.

In overall terms, renewed interest by upper-income
groups in older central city housing hes had no* appreciable effect so far upon the persistent patterns bl
middte, and upper income dispersal out of central'cities and older suburbs. The relative novel ty of ceneel cities compared to suburbs has continued to increase throughout this decade. BetWeen 1050 and

New. Markets for 'Old Housing: Is There a Back-tothe-CityMovement7
is these conditions among low-Income homeowners
and renters in the central cities that raises some con
cern about the potential of the so-called "back to thetcity" movement or "gentrification" as rising housing

1976, the there of metropolitan families, with incomes over $25,010 living in central citiedropped

costs enhance the appeal of older hOusing for middle.
and upper-income purchasers of housi'ng.

from 45 percent to 33 percent. The trend for %mil ies

with $15.000 to $25,000- income was similar, declining in the central citios from 47 percent of themetropolitan share of such families in f9p0 to 36 ,..

Is three evidence of such a "back-to-the-city" mOvemem of middle- and upper-income-households? Is
there a strong new_interest in the rehabilitation ofpercent in 1975.
older ,urban housing that signals neo( opportunities
for urban redevelopment as weiLas problems of -clis-- However, such dMa measure the past. It is essential'plgeement-rior loVancome families should such a prothat We attempt to detect nascent trends, early incess accelerate?
their development, ,that may ultimately have important consequences for our communities and regions.
The Jrbn Land Institute has estimated that some A conjunction of several trends indicates that some.privath rth/obilitale is taking place in 75 percent of
selective growth in upper-income households may be
all cities over 506,000 in population. It reports that underway in selected neighborhoods adjoining themost of this rehabilitation is eoncentrated in specific central bukinspii7districts of many cities. To date,neighborhoods with unique architectural or historicalmuch of thiso-called "gentrification" is occurring
qualities:or with other unique amenities. In -a recent. among househOlds with incomes above $26,000. It
HUD study it was Observed that: °1

appears to represent not so much 0 "back-to-the-city"
movement as a relocation of .those who are alreadyreskients of the citils or of new households.

Rates of immigration to central cities for whites,
and the whitnhare of total immigrants to cities, have
gradually increased since 1970 in most of the SMSAs
studied. But only in Los Angeles is there consistentevidence that whites may be "returning" to .the cen-.
tral city: rates of. immigration to the central efiy andor selection of the central city by suburban movers
have both increased sharply since 1970, and net intra
reetropoliten movement has changed to net inmovement to the central citY by whites.

-s\

A conjunction of rising costs for 118W housing plus thechanging social character of households today ac-

counts for most of this intdrest, !Afftilq purriercit end
real income hp.e lioWn signik'Ontly in the last teriyears, rising hotising construction costs have priced \s,many middle- and low-incOme bUyers put of the'Mprket for new hOusind end toward existing houSing.,A.
In the other 10 srvistk& whites still appear to ' recent study of !the natiOn's housing,at the Harvardavoid the 'entral city.. The post-1970 data resemble
MIT Joint Qenter tor 'L4rbprl :8tucli4s,t000 that, inthe pre-1970 patterns in showing net intremetro- ' 106.50,.of :the 75 pereni of families in the 'middlepolitan outmigration from the central cities byH and loweri'Indorne brackets, 70 percent purchased
4
r'
.

.

41P

62

it

new homes In that period. In the period 1975 70, of
the 76 percent of all families in the middle- andlower-incOme brackets, only 42 percept purchased
new homq in that period.
4

The market appeal of used homes has increased, but
therr_prices.have also risen with tho general oscakitionin the price level. The cost differentials have given
some of the impetus to new interest in the rehabilitation of existing housing stock in urban areas. Whereas
new 'and used prices were comparable In 1970, in
1976 new house median prices Were 16 percent high-er. This differential is important to the market forused housing. The wider the differeno between
average new housing construction costs affd purchaseprice plus renovation costs for older housing stock,
the greater the econOmic pressure for residpntialsredevelopment. Since .1970, the purchases of existinghomes relative to new homes has steadily increased.

It goes on to point out, in a study of private market
renovation in older, urban areas, that owner-occupants
Id the central citieS of the nation's metropolitan areas

spent $2.6 billion for maintenance, repair, and construction imprOvements. "By 1976," the researchgroup reports, "this figure had risen nearly 35 percent, to $3.4 billion, expressed in constant 1973 dollars. This rate of increase in owner:occupant activity
far exceeds that found In the suburbs."
This increase in activity of higher income hoUSeholds
in central city areos is not yet statistically measurable

in terms of economic improvement in central cities
4nd olde suburbs. But at another level of detail, tho(lady consie9uences are becoming more visible.

One recent study fOund an Interesting pattern emerging among the 20 largest cities in the country. It akternpMd to determine how many census tracts in eachcity had become wealthier and more highly educatedthan the rest of the surrounding metropolitan area
The Urban Land Institute reports that between 19676 and how many had become less so during' the decadeand 1976, annual expenditures for housing maint4.\ 1960-1970.
nonce and improvementincreased 17 percent Itig?).
constant 1973 dollers)--from $17.8 billion to $20.8 Three of the 2 cities with very strong 63ntral busiite collar employment increased inbillion. During the same period, -however. expencti- ness districIs in, the hun:iber of h. h rnedian income and educationaltures for new housing construction declihed$33.0 billion to:$25.9 Million, although thit'i 1975 at6ir'iment tracts over the decade: New Voris,
Jecession affects these tpsults. In 1975, housing Washington.' and Bostoneven while losing populaimprovement expenditures were equal to 80 percent tiori end &Perk:ming housing abandonment in many
lower-income peighborhoodS.
of now construction expendiT!'9s.
Vt.
I:ftilsiio4a1,4Treedi.1rn $ellei of NeW anti Existing

One-Family Homes: 1964-1975

3000
0.,u)

0
to

2500

2000

Sales of Existing Homes
ir

1500

co

1000

Sale$ of New Homes

500

1964 65

66

67

68

69

1/4\ 70

71

72

73,

Apaockattlon,e( Itiatt\ni "Ex#oftlug Iltoute Woo Honfkly Rapuict:"Waahliostunk D.C.
Sontee: .Ifot ion
Dapartiampt Olt Stonoodca M,Ostraorcht Anginal 19761 sod U.S. bureau of tho Comma, Colint4ocAtoa"Onr-rmeitly Hobos Sold and Yor 1111n," Annual.

74
H.A.R.

75

)
to.

58

The number of tracts with mdian family
Income and Radian educational attainment
gropter than.,or equal to that for the SMSA

Not Wool Hooting Inwmtnwnt: Now Homing Collet 0frotton end
Improvements to th. I xlsting Noosing Stook: 1960.197(4(In Conowt 1973
apendituros

Vor

Ikprifituros ler lout Expenditures

Howling Melotor Now
trovoln9tynano. sondConervoilon Improvrienon6

1905
1060
1907

11.)1111ono)

KM -- _ 310
1909

1970
1971

1972

1973
1974

1970

33.2
30.1
11.4
40.7
47.9
33.7
26.9

Hbuserwa 0erel09men1

Conivuutionno

Perooni of k.o4ndl
Wry* for Now lioublog
Conoruellon

ktolowoono.
(t)Mlons)

17.0
17.0
17,p

33.0
29.2
27.0
.

EallowEllturw for

tor Nagano

!Z.,
17.3

16.4
19.2

am

52.7

IWO
40,0
44.0
51,2
50.5
40.0

52.0
62.1
01.1
40.4

00,1

00.4

19.0
20.6

02.7
40.7

.,,-"'

Educational Total numberof tracts
attainment

Familyincome

06.3

60.0

19.4
16.6

High median

City

300
XIS
60.4

00.3

Soon, U.S. Bureau of 14Consua. Conetrucilon F14irte, "Volurr of Norw 110..4109 Pul In"74A/4111101 Allogedons 4n4.111.64kt Dock lo-014-Clly.
Ptc. enou01,
Mo. 1977.

Seven more chies with declininae populations posted
gains in high median income ard educational attainment neighborhoods close to the central business district: Detroit, Philadelphia, Seattle, Minneapolis,
Pittstraqh, Milwaukee, Los Angeles, and Baltimoreagain even in the face of population losses and neighborhood abandonment in some low income areas.
Three cities experiencing Population !odes that failed
to demonstrate growth in' the number-pi NO medianincome or educational attainment.treoti,lAferel peve-

Atlanta
Baltimore
BostonChicagoCleveland
DallasDetroit
HoustonLos Angeles
Milwaukee
Minneapolis
NewarkNew York
Philadelphia
Pittsburgh

1970

1960

19

71

71

4

54
24
'63

64

1970 1960 1970 1960
2
0
7
8

16
1

2
14

80
42
46
'38

24
59
75
42
45
38

11

15

91

91

8
15

59

90

82
70
61
136

82
70

1

10
19
0

61
131

106
80
28
33

100
80
28
33

3
6

12
2

5
12
2

f

-1- 9

9

0

5
10

1

3
3
1

1

4
4

0

9
2
10

8

0
6
5

1

15

18

77
15

12

14

11

10

SI Louis

2
1..

0
3

3
3

1

St. Paul
San Francisce
Setittle.040hirigtor1,.

11

17

32

7

' 10

/33

18

7

13
24

165

179

293

72
9

77

77

34
66

436
66

279 1,284

1,263

15
19

land, Newark, and ,S t.. Padi.
Total

The central cities of metropolitan areas still attrectipg
sub\starrtial inrmigrat ion: . hlive experienced declining'
nthitws of high median income and educatiooal at-tainment tracts in the face of these pbpulatiOn ir

and public health seres, the most diverse employnient Opportunit)es anMhances foodvancement, thebest shkpping, the best higher ed4etlon institutions,.

,lt.ntes: San'. Francis:Co, Dallas, Houston', end Fort

the ,best`parks and. playgrOUndS, eiitd. the best public .

It,torth,

serVices-clearly a list of perceived advantages attractive to Many of the new, better educated, less childcentered households now being formed;

While these findings are far from definitive, they hint
at possible processes of social and residential restructuring that may begin to occur as cities and metropolitan areas cease serving as important destinations
for inMigration. Properly nurtured, these processes
for diversifying the income and residentital. mix ofcentral cities indicate some opportunities for national
urban policy in the future.
Motivations, Attitudes, and UrbsO Policy, ,But in this same national poll based on a sample of7500 participants, cities were also perceived as having
more crime, worse schools, and worse housing thansuburbs or small communities. As if to underline thistttception, most Americans believe that cities are theworst environments in which to raise -children. Less
than half of those interviewed, who are curreat oily
,residents,, want, to see; their offspring reside _in cit.%\--.

when thpy brow. up.

Whether th4e Opporiun iiies'cantbe relilized, however,will ver muCh be determined by attitudes ofuals and households toward the kinds of communities
in which thry prefer to liVe.

When theSe negative perceptions of social disorder are

weigheil in the balance with the favorable attitudes
towar,d cities, the attitudes that lie behind urban
dispersal come clear,

In a special riational,poll on attitudes tpward cities
commissioned4y the Department of I-lousing and
Urban Develorment, most cititens weraltill found toview_the ities as the locations kwhich to find thebest rridSeums _and cultural activitieS, the best trans-

portation, the best restawants, the best health care

64

Three out of ten American adults say that tlpy willdefinitely or probably move to a new resilence in thenext few years. City residents sampled in the ,pall,pre7
somewhat more likely to indicate moving intentions
than Are pgrIgus Ihr(ng outtlde of-cities; 35 percent of
current city residents indicated that -there -is a good-- -!My that they will move compared to 29 percent ctf surburbanites and 26 percent of nonmetro-

Housing Progress and Distms

politan residents.

There are signs of housing progress as well as decline
in the central cities. 1 he homeownership rate among

The clear population losers in this relocation process
are Americxes cities. Approximately 15 percent of all__persons who presently reside in central _cities intend
to move in the next few years to areas outside theic,own or another city. Only about three percent of all
persons who( presently reside outside of central cities

black families has increased .and now stands at 37
percent. However, central cities are consistently the
only group of communities containing more renters

plan to move to a largT city within the next few

about half the rateabout 1.5 percentof metro-

years. If the potential for migration, as indicated by
the statements of intentidn elicited in this poll:isrealized, we can expect a continuation of the outflow

politan housing expansion. The share of metropolitan
housing in the central cities has declined from 50
porcent to 40 percent between 1960 and 1976. The
median age of housing in the central cities, 31 years,
is higher than for any other category of community.

from cities toward outlying suburbs and exurbs.

than owner-occupied households,

Inner city housing construction is proceeding at only

So long as fears over public safety, deficient schools,

and deteriorating housing and public facilities outweigh the pull of urban living for many of today's
households, any strategy for revitalizing cities andpider surburbs is unlikely to attain the objectives laid
/down for it. Not only will these concerns over thesocial quality of life in cities deter an influx of newvitality and activity, they will act to drive still more
population and economic activity out, leaving theremaining poor caught in a vicious cycle of decline
from which they cannot escape.
Central City Housing and Neighbothoods

afran, the Minority fpnlies living in our citifs
It is,
who are most adversely affected of all by These veil)

conditions. In this poll, more than twice as many
blacks as whites saw crime as a severe problem forthem and their neighborhoods. And while only 16
percent of white city residents cited housing conditions as a problem in the community, 51 percent of
the black respondents did.

The proportion of overcrowded housing units in the
United States', has continued to decline from eightpercent in 1970 to five percent in 1975, but the rate
for black households remains twice as high as the rate
for all households.

The mechanical adequqcy of housingelectrical outlets in every room, full and private kitchen facilities,
adequate plumbing systems, and home heating
systems--has coritinued to improve, but again low
income central city households, both black ancr
white, lack adequate plumbing more than twice asoften as all central city households. At least ten per-cent of all flow income, minority hoeseholds in central cities report structural, deficiencies in housing
despite a steady decline in such deficiencies by one
half in the suburbs and one third in the cities between
1974 and 1976.

A number of indicators signal retrogression or failure,to move ahead in improving the quality of urban

houStng andpeighborhpods, ,Despite the grceing needpisussed later, in pls.-rept*: It ..it ' tb-ccerlserfe energy, thene has been no improvement in"i'he PisiSibill;ties for dealing with neighborhOod C'ritro;.ebd :;SebbOls',er.

.eiiiiallY etkint I, ..hOwesier, . that liOusieg ;ibtorkets-iii,
the central citle and older suburbs be opened up to'the regular processes of .r'entriyai ,end irnproveyient .. .in W.,alls end. attics Roughly two-tlirds ot all single
that operate elsewhere,1-:

farn,ily lriper city hOhle, fack 'Sip vi 'windows and

.

.

...-

-

the nurnbeit;olsingiefainily iriftropPliten homes with:storni. WindOWS2 Sldrm. dobrs,- and adequote I nSuiet lOrl

.

.

.

Older central cities andVner suburbs must bectiMe'
competitive with suburban and nonmetropolitan
communities as places in which to live if theireconomies are to be restructured and revitalized. A
strategy for these older communities must focus pn
tutio aspects of their residential development: (1)reversing the process of social and residential decline-in -existing neigiborhoods; and (2) enhancing their. ability to compete for now households that will help
diversify ithe mix of inFpme groups in the communityand strengthen the IbqØI residential tax base.

StorM. dOors .Com ared to ahoUt half of ell sUbUrban-homes:--Neighborhood quality, as measured by such indica)(ors as abandoned or deteriorated housing ,,and presence of rats or mice, is declining rather than improving in metropolitan areas and is worst in central cityneighborhoods. Between 1974 and 1976, the proportion of all central clty residents nbting the presenceof rots or mice jumped from nine percent to IA per-cent. in the same period, the proportion of blackhouseholds in central cifibs registering the same corn-

5. The Employment Shift:People, Places, and Jobs

60

plaint increased from a little less than 25 percent toslightly moro than that share,

Ihe proportion of cent6l city residents living in."We look at tho economic trends that have takenplace in this country since the turn of the century
where we had 38 percent of our population in thework force on the farm and manufacturing. If we'neighborhoods where there is abandoned or deteriorated housing is Increasing at about one percent a year.
By 1976, when 10.percent of all central city rpsldonts
lived in deteriorating neighborhoods, over a quarterof all minority central city residents lived in such

look now at the 1970s, we have four percent of -our
population on the farm. We only havo 32 patent ofour population in manufacturing, and we now have
66 percent o f our population working in the service

areas..

said, "Hero is tho packaging line where we used to

sector. . . I ju\ welit to a firm in Hartford, and ttley

have 34 people fliorkIng. Now, we are automated, andArresting Decline

The causes of urban neighborhood decline are many:

the boom in suburban housing constructiop in previous years; relocation of employment raciaTtension;high concentrations of poverty and unemployment
the inadvertent consequences of public policies,
destruction of neighborhood and community values:
and unavailability of financial and other resources tomaintain and renovate existing housing. Residential
rehabilitation in central cities and older suburbs must
deal with all these contr ibutors to neighborhood decline and abandonment
0.

Progress is now being made in improving the availability of capital for inner city housing and neighborhoods. Red-liningthe practice of discriminating
against certain neighborhoods and homes in ihe provision of mortgages, rehabilitation loans, and insurance protectionhas been progressively outlawed at

we have only four." That shows you how we arechanging. If you want to put the people in the city
back to work, they tylvo to write, and that means
education."...
Nicholas R. Carbone, Hartford
City Council
Boslon Citizens Forum,May 23, 1977

In 196b, there was still a presumption that the bulkof expansion in production and service employment

would occur in the Nation's major metropolitan
areas. Migrants were moving, though in dwindlingnumbers, to the metropolitan centers in .the expecta-tion that they would get jobs they wer,e unable tofind at home. Programs ithendecl to help !edging rural

regions attract new jobs provided incentives to lure
manufacturing firms into nonmetropolitan areas.

level of government. Many cooperative
approaches between government and private lenders

In 1978, perceiltions are very different. Manufacturing is no longer a Major source, of new employment.
to improve the availability of capital for home im- groWth nationally. Nei,/ manufacturing locations areprovernent and construction in older neighborhoods in outer suburbs and nonmetropolitan areas. And theare now getting under way.
areas where such jobs were once concentrated are
each

4

0

losing thefff1 through plant modernizati n and closures

The Community Reinvestment Act is a key tool inincreasing the availability of credit' to Own homebuyers and the Home Mortgage Disclosure Act assuresthat irrer city residents are informed accurately
about the terms of local lending practices.

Segments of the financial community, such as thesavings and loan associations, have embarked on
special industry-wide efforts to improve the availability of capital for home improvement and construction in urban neighborhoods. In Milwaukee,
Louis, Philadelphia and Pittsburgh, lending
institutions have joined in a vadety of arrangements

St.

with a fall-off in plant expansions and ew firm formations. Central cities have been the rimary losers,
mostly in the Northeast.and Great Lakes regions, butalso including Los Angeles, San Francisco., Seattle,
and New Orleans, and several other older tnanufacturing centers of the South.
Regardless oNeglonal location, central city shares ofmanufacturing employment have been A:dining overa long period. Between 1967 and 1976, total employment increased in all the Nation's large metrqpolitan

areas except New York, while manufacturing deto improve the availability of mortgage loans to creased in almost half of them.
older neighborhoods.

But Ausing improvements must be coupled with

employment opportunity if the central city poor are
to be enabled to move into the mainstream of ournational life,

6

It appears unlikely that large-scale traditional manufacturing will ever again find central city locations
suitable eAcept under unique circumstances. 'Suchlocations are likely to remain uncompetitive in termsof space and other costs with other sites in leas conc

Employment in Central Cities: 1463-1976
Number of.

Annual Bate of Change
During Period

Northeast
MidwestSouth
West

Central Cities
U.S. Mandfacturing
Employment

1975.

(Percent)

Control ClOes

1963-72

1972-75

11

-2.-1

-5.3

19
16
10

56

-1.0
-2.5
-0.2
-0.8

-3.1
-0.8
-0.6
73.8

NA

-1.41

-1.3

Source 1963 and 1972 Census of Manufactures, and 1975
Annual Survey of Manufacte(fes(posted locations, though central city locations may
become competitive for smaller innovative and spe-.

cialized indusoies.

Because they developed at a time when manufacturing located in cities and towns to be close'to workers, many of the older cities and suburbs in
the Northeast and Midwest still have higher than
average shares of manufacturing'employment in theirjob base. San Jose is the only large metropolitan area
ouside of the Northeast and Great Lakes areas withmore than the U.S. average share of 24.3 percent
manufacturing in its employment base.

For cities that have specialized in manufacturing in
the past, the transition to a new economic base lessreliant upon nianufacturipg Will pose special
challenges. As Thomas M. Stanback .and Matthew
Drennan, at Columbia University, perikt out: "In New
England, the Midwest, and the Great Lakes, 65 percent or m*e of the metropolitan areas specialize in
rnanGfacturing." Such cities,have been the least successful in capturing major new economic growth innonmanufacturing employment. For example, ' therapicrArowth employment sector of finance, in-.,surance, and real estate serves as one indicator of anurban area's role as a major center of service industry.
Regional capitals and amenity centers such dibenver,.

their nonmanufacturing employment as well as
manufacturing em loyment growth. The number ofservice sea* jojA in southern cities has increased attwice the re of northern cities between 1960 andinAnnual Percentage Changes In Manufacturing

Phoenix, Miami, Atlanta, New Orleans, Dallas, andsome Florida, cities all show higher than nati9nal
average share of metropolitan employment in that
sector as do such national centers as New York,
Boston, Chicago, and Los Angeles, But cities with thelowest shared are such heaVy manufacturing cities asluffaro, Pittsburgh, Milwaukee;St. Louis, Cincinnati,nd Cleveland.

Internationalization of Production
An increaSing share of manufactured goods purchasedby American consumers Is produced in foreign coun-tries, sometimes by American-owned firms, more
often by foreign producers. As the world economy
becomes more integrated end trade barriers are relaxed., older manufacturing centers grow increasingly
obncerned that the decentralization of production re,sults in manufacturing employment shifts not only
within the country, but.5averseas_

The impact of overseas production on domestic production takes several forms:
kFirst, Amer icon firms may invest in 6Verseas production facilities. Since World. War l I, aS t e world's !ergest so urce of investment capital, th 5)1 .S. has led in
the amount of foreign investment. In 1976, direct
foreign investment by American firms totaled $137
billion. But as a percentage of gross domestic private

fixed investment, U.S. foreign investment has declined from an average of 5.6 percent in the period
1960 to 1964 to 2.3 percent between 1970 to 1974.
On the other hand, if' the comparison is between
Capital expenditures by majority-owned foreign affiliates of u.S. companies and nonresidential grossprivate dofnesti investment, the percentages are substantially higher, averaging 16.5 percent between
1973 and 1976.
Assessinents of the impact of this overseas investment

by American firms on domestic employment vary. A
1972 study by the 41J,S. Department of Commerce
estimated a positive gain of 600,000 jobs because ofpurchases-vof intermediate goods and equipment ih
connection with these investments. he U.S. Tariff
Commission, using a number of different assumptions, estimates the impact as ranging from ET gain of
500,000 jobs to a loss of 1.3 million.

In 1973, imports from U.S. foreign affiliates were

only a small fraction of total sales by these affiliates
about seven percent, and these were a much smaller
fraction of total U.S. sales.

The clustering of so many older industrial centers A second aspect of international production thatcompetition from forclose together in the old Manufacturing Belt of the' affects U.S. manufacturing is
If
the
value
Of
the
dollar declined sufNortheast and Midwest makes it difficult for ell cities eign firms.
ficiently,
itisconceivable
that
the
U.S. could com:in those two regions to become service capitals. As apetitively
exportmany
products
thatit has hitherto
elsewhere
consequence, they lag behind urban areas

R7,

,Ae/

A

,fity is no necessary guarantee that those jobs will(,filled by central city residents.
comirtitive with foreign producers in several intries; For (ample, in 1965, steel 'imports were 11,2
percent of U,S. ocluction, By 1976. this share had
Distribution ot Workers by Place ot Residence and ot
Emp1oynmnt In SMSAs ot 100,000 or more,
cfirnbed to 16 rcont 1n1965, foreign auto imports
1960 and 1970
were 4.4 f)CICOfl't of U.S. production. By 1976 they
imported. However.. U.S. producers are still n

62I.

had reached 23 percent. The shoe industry now has
46 percent of its sales supplied by imports;up from18 percent in 1968.
workers displaced
Industries with more than 20
by foreign- aiMpetition and sisted under The Trade

Adjustment Assistance P gram, are apparo1, leather,,f in lty metals, fabi icated metal products:, le tr icoI
and lectronic equipment, and transportatio o uip
merit. All but apparel are concentrated in the old
Manufacturift Belt regions of the Northeast end Midwest.

.;

Inskle.

01111ty

Ouhdo

Central C4,(000.1)

1960
Intudo24 7022.020
11,325
3 353

05

W./ 0

7 043

3 456
230

2 I 299

46 I

24 0135; 53 919.00446 1040,491

OuletOO

loot.PorcOnt 01 total

aer
Paroentof Total

20,32017 01030 145

53 3
40 7
100 0

IL) 70

In

o

Ov
Total

Poicont of Toni

5/ 3

42 1

WOO.

190

x

Tor older manufacturing centers, foreign,competition"is an added factor in the dispersal of jobs.
Suburbanization of Nonmanufacturing

Within themetropolitan areas, suburbanizafion of
employment has proceeded at a rapid pace. In SMSAs

greater than 100,000 population between 1960 and
1970, emplootenlin areas outside the central cities
grew by 47 perent while ,central city employment
grew by only seven pet cent.

While suburbanizetion of- employiiient is occurring in
all metropolitan areas in all regions of the country, it
dis more pronounced around the older, denser cities of
the Northeast and Midwest where suburban employment has been growing et rates in excess of ten times
those of the central cities. While allowance must be
made for. annexation, suburban employment in theSouth and West is growing only about twice £A fast as
in the central cities.

However, political and static al boundaries should

not be permitted to obsctift.from us the actualchanges that;\ are occurring rin human behavior as
metropolitan employment decentralizes.
The Central City as an Erployment Center

A

W0,111111'

First: even though central city shares of total metropolitan employment are declining, they are still the
major job center in most metropolitan areas. Despite

rapidly declng central city

population's' in the

1960s, centfal-city employment did not decline as
fast. Suburban residents who work in the central city
have offset the decline in residents Working in thecentral city. Thus, creating new jobs'in the central

Seco?tdi4L because a worker lives 'in the central city
does not necessarily 7n-ean any more that he or sho
works in the city. The number of perSons commuting

from central city residents to syrburban jobs increased by 70 percent from 1960 and 1970 while
suburban dwellers who commuted to central city jobs
increased by only 33 percent. A study of New York.
St. Louis, Philtidelphia, Boston, and Ctlicago

prototypical "older cities"found that the nUmber of
persons commuting from central cities to suburbs forwork is increasing relative to the number making theaccustomed surburb-to-city aaily trip. BolVigen
1960-1970, while suburb-City commuting was growing at rates of up to only 13 percent for the period,
the number of reverse commuters from cityIcistiburb
in Chicago; almost doubled4n St.
more than doublLouis; grew by ov r 5 percent in Detroit and Phila-delphia and ind by 14 and 19.5 perce

in

Boston and New YOrk.
1

Central City-Suburban Interdependence

sca data not only reflect the diffusion of residential
aneernployment patterns that now characterize the
Nation's overall growth; they also reflect the essential
economic interdePencience existing between city, sub-urb, and outlying rural areas dn the fringe as living
6nd working pItterns intertwine and.the old "wagon
wheel" image of the metropolis with a strong core
likes way to a poly-centered urban region in voich
the old center is but one of several centers; albeit aunique one,

Suburban residents depend upon the central business
district for many of their jobs Oven while central city
residents commute in the oth9r direction. Given theseintertwined patterns of commutation, it is not stirprising that the rate of suburbanization has accelerated since 1970 while some white "gentrification"

'61.

-

,
S.

a

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63

of neighborhoodt closejo.clntral business districts
has become evident.

IFT
'

01-

Peoplein Distress ..
The central city poor stand isolated frorv the benefits
01 these .-chariges, however,- -A's Ore employment

opportunities they most'seelt -decgtialize into theouter 'suburbs and beyond into noketropolitah aretts
26 to 50 miles away from the rnetropblitan fringe,
they no longer hihie the option of Moving to live runia job .in the same sense that they and their relative
moved into the city frOm rural areas;in..search of'Opportunity. The cities absorbeWhis inflgri of popul%

ation through the "trickle doWn" of ,ihousihg frommiddle- and upper-ihcome households t. lower-,.

income households. In smaller communities'iwheEe
housing fpcilities and services are rflore, scarce ar,od
inmigrants more visible, such as a process does notoccur and in-movement is!. resisted, sOthetirnes.
through racial discrimination.
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1. Openipg Up OpPortunities
1"How do we- satisfy the myriad claims to human^.---excess supply of kknskilled workers in every ,region
rights and freedoms? By provkling an urban environ- ol the country. They either tend to stay whore they
ment which will alloW for the social mobility which are or their movements are cancelled out by crossshas traditionally been the economic and philosophic niigration. e,g.,lan. unskilled worker will move to
Los 'Angeles in rk. futile search for a lob. while abackbone of our country.

BBworker from los Angeles will move to Detroit in
Rbert (5ilmore, Building Trades

a similar quest.

Co-Onoll of .ort Mateo County
Citizens Folum, San Francisco
June 22, 1977
Places and Places

There has been a longstanding dispifte among specialists overwhether-,in attempting to meet humanneeds, it is hest to concentrate most aid In income

The older, skilled, blue-collar workers who lose theirjobs in plant closings and job displacements are usualIA not very rxbile either. Thehy own homes in commilnities where Axl9hornes will be harder to sell than
before. They aw unable or unwilling to make major
occupational clthnges. Family Lind other ties makethem poor prospects for migration even if jobs wereavailable for them elsewhere.

payrnents, gaining, and prbmoting mobility or shallwe concentrate our efforts on building up the sur- Nor is -it 'feasible for the Nation to adopt a "hands ,rounding community,'its houting and .the job oppor- ..q.U. policy with respect to cornmuntties in transition
tunities it offers?
hoping that nature will take its course and the area
will eventually attract now enterprise as wage rates
A strategy focused purely on people asiLlmos 15er lec
drop in the lace of high unemployment.
mobility. Once trained, people will cnove t
ere
the jobs are. A purely place-based strategy may pro- Unfortunately, there is little evidence that wage rates
vide a physioaLenvironment unrelated to resolving the

problems of4leople who live in ita mistake of the
housing programs in the 1930s.

,ts

in an area will be redticed as employment declines. In
fact, just the opposite appears to be true; cities withhigh rates of population loss, high and increasing un-

emplai-nent wtes, and low rates of income growth
Successful national urban policy will depend' upon awise balancing o? aids to people in distress with strategies to improve theseconomic and physical conditions of the communities in which they reside.

havTh highest average wage rates and the high rates
of wage increase...Several factors including miniipin
wage laws, existing wage contracts,lkind adininisibred

in industries help to account, in part, forpricesCongress long ago settled this dispute among purists

the fairtre of this mechanis% to work as exPected. As
a result, high labor costs in"!hese declining areas will

4 by attempting both people- and place-related strat-

continue to inhibit new investment. Further, highfiregies because it recognized thatwages attract inrnigrants. Thus, in plixes losing jobs,

People are not perfectly mobile. Sometimes there
no plac fOr them to go. Frequently they haveequity in hs nd businesses.that anchor them in acommunity. _Communities And states are integraisorts of ourcontinued high wage rates will cOntinue to attract
dnmigrants keeping unemployment high. These patterns seri usly weaken the ability of 1.141 system toFederal system. Their fiscal integrity and ability to):A./hile we hay

servrce their reSidents is jdirectly dependent on theirability'to compete oconornically in a thriVing naponalreach a neo .aid botlipoople.,ind
attemphave riate4trne so with llny
places in the pastcoherence. Separa Jatograms enacted for separate','economy,

purposes were administered separatO with little Atlino comprehension Of the consequen4 for either

ven if the Unemployed of the cities were perfectly
mobile and there were adequate job opportunities

oeople or 'places.

fl,National 'urban policies tlaust consist of a delicatelybalanced series of strategies designed to help bothpeople and places; some addressed to hurnan-raS in
numbers of certain types of, jobs are simply riot avail ....ttie near-term, some to community potentials in thetable anywhere in the cottotry.
long-term, including:A "eeople'-'. component designed to provide irn,Those with skills in demand are able to move about mediVe and mid-term assistance to individ Is tO
the country in search Of jobs. The cpntral city poor 41-tdintain good health; be educated and trai d forare simply not in demand 'elsewhere. There is an productive, permanent jobs; be housed in a' decent,elsewhere, such a "naturaR' adjustment process would

take time to occur. However, many of the unemployed are far from perfectly mobile and adeqyate

4

71

/

J.

\
or

z.--

country, for that matter. To enable thirm to do sp
will require special carefully targeted efforts to 11)-

sato, and sanitary home; and to realize his or her fullpotential without inhingernent by discrimination.
I and economic development components
Phycreate a physical enviromfient conduciVedesigrto new firm formation in the community and to provide the incentives, space, land, services, and quality....of\..operating environment required to attract and retain potential residenti4, nonrnanufacturing, andspecialized high-ernployntont growth manufacturing
reuses appropriate- to central-city locations in 4he,future.
Soaial "and neighborhood components aimed at
cgrrecting the social disincentives and irepediments toeconomic revitalization, i.e., declining schools, highareproblems while im crime rates, and chronic w/. ),\proving neighborhood housing nd living conditi6ns;
enabling workers to Ike anywhere of their own
choosing in the metropolitan area; and diversifying
the nth< of income groups residing in the city itself.
Thetentral areas must become competitive with suburbs by offering a unique residential environrnen.. Nocity can long survive solely as a reservation for thepoor. A diversified residenlieMse is essential to both
the restoration of a stable tax base and tho redevelopment otf the economic base in the central areas, solong as'displacements of low-income families .and inPividuals can be avoicird through the use of special

move racial discrimination from-herusing o4rnpioy ment mark , special education and train' g efforts,
and assistance in l.onniwting to or moving tO jobs.
throsident's Urban,* Tiegional Iolicy Grouphas repo ed, racial discriminati&...in the labor market

and lock of edution and training, related in tort toar more important thOf
past discrimriation
housing segregation in expl ming the low earnings ofinner city minor' ty popula ions. Preee figures are
not available, but c Iscrimination appears to result in

hiuher rates of nenority unenvloyment and lower tales, of job mobility. I-bolding oduceion constant,minorities suffer higher unemployment rates thanwhites, iOnd seem to beiexcluded in some industrOs
from top professional and managereenteQciries.

Minority-unemployment in c.ities is generally morethan twice the level for whites_ In rhany distressed
cerxtr al cities, nearly 40 percent of the 'black youth
are1mernployed.

This does not always mean diet no jobs are availa blk
in central cities. bespite the AM of jobs from central
cities to suburbs aisl.d in lorne cases to other regions,'

aids.

central cities offer More jobs thail the niimber of,toward a mort viable economic base. While inly caused by the misInatch be6teen people's skills

governmental fTical transfers .from Federal and st.

nd the skills needed for available jobs, rAinforced byiscrimination. In'this context the rapid' rdss of menufalkuring jobs in distressed cities narrows employ-

A fiscal conrponent5lesigned to .assist these cities v potential workeirs who live there. The high rate ofin transition to meet the needs of their inhabitants in chronic nrinorii memployrnent, particularly in disthe face of tax base deterioration while they s ift tressed central cities nd their older suburbs, is main-'governments offer' the only immediate device
accomplishing this aid, long-tera solutiOns will
depend upon still anothor
Governmental restructuring. he structure, functions, and financing of local go rnments in these old.

ment opportunities for the unskilled Or 'nominally,skilled.. Minorities are in the "wrtng-place" because

atch the social andurban areas no longer
economic realities that existi,tates will confront theaway from, or are not expanding near where they
live,, They also have inadequate traing and e.duca-

urgency necessity for local-government strearnlifing
and reform in these areas`in the decade ahead. It is
likel tftat the growing economic problems ortheseaLeas will coopel suCtrveforms despite long standing
politicl ollSposition,

tion, As a result they cannot.easily compete fOr jobs
remaining in the city' or elsewhere in the metropoltan
labor market.

erfirms able or willing to hire them have closed, rnoyed

Cities are not well equipped to deal with this prob

Opening Up Opportunity for the Urbarl\UnemyLoyed

lern. Industrial technology is changing, requiring lesslabor and ripe capRal. Many of 1.40-neAf PiiVk andprivath servlce jobs require levgs of educatiOn and-econorrk development in the central cat and older
suburbs may hOt match up with the employment

ployed minorities.

neetls and sk ills oil the central city unemployed. Manyof the new jobs that might be developed might readily be fil-led by workers living elsewhere in the metropoliten area. Unemployed central city residents must

hay9 the opportunity tO 'compete for jobs anywherein the metropolitan labor marketor elsewhere in the.40,

training often not thund among chronically unem,

Affirmative Training and Placement

Affirmative training and placement programs for theunemployed must be matched up wRh whatever newly developing job opportunities. may exist within .the

7o

r,

68

urban labor market. This Carl only be dem thiNghclose coordination and planning with ani9l6yers,,

plOyment prograrns with private employer.s. Under.1hOse ProOranis, privalq-omployers can receive u sub-be operated as a key component of an affirnMilveskly te Nip 1..sticli workers at or above the miniminn'waye.w9/the Objective of mQving them eventually

labor market strategy.

into madistrearn omployniont.

Vocational and technical training sChOelt vv,ill f,ieVeld'

Federal Comprehensive Education and T rainine. Act funds, together with other. manpOwelVand yout.h ernployment funds, should serve Mor'e iiltin,c.VcIkal our,poses and be combined into a.c.brefd.liy targeted trpInj
ing program for permanent jobs operated In cdoperation with Private employers. It should be designed to ,alleviate structurs,il unemployment in the central

1. h displaced, skilled, maim e manufat:tyl ing-vvor ker
hat Or tliffetent 'needs. Such worker02with substan-tiol equity in their homes and out tif work solely
because Qf plant modernization, relocation, or (shut-

down, aro able and willing to work, but unable tofind work appropriate to their skills locally. 1--(3-ntebt

these problems, regional employnieni informationand forecasting seivicos opetated in aitoperation with

the Employment Services, might be seriously con-

The question of providing moving co4to trainees

siderk At the time disOcement occurs" pch a

wishing to relocate to jobs outside of their local labormarket should tm openly examined. Such relocation
is in the long-range best interests of both the worker

regional job information lohnk could work closelywith these mature workers in identifying job pros-

and the jurisdiction. Such payments are regularly
made to workers by .pther advanced industrial No.
Om. lo date, the United States has not done so

priate to their skills. Retraining and mobility nssist-

except on a demonstration or experimental basis.

Discrimination

pects nearby or elsewhere that are reasonably approaAe might also [move necessary in Inany cases.

(
Transportation
Urban transit systen'is must be reoriented from servicing solely the suburb'-to-city commuter, who are using
the_syeforn at declining' rates, to tIm reverse city-to:
suburb ort...:eross-motropolitan commuter. Whole--erfc-

ployment prospects dePond upon public transit outof rather than into the city. Servicing Widely dispersed suburban ernplofment locations may requiruse of new, smaller scale 1ransit units on flexible
routes.

Public Service Employpit

Although we have enacted strong legal prohibitions
against Orim.inationof all kinds, the President's
Urban and Regional Pdlicy Group'has omported thatminoriti9s still Uice formidable attitudinal, structuraland institutiotml Orr iors to' their full participati
the life of. this countily.'Uniom seniority systems, resi.
redlining, inconiti requkements for loans,denti
cred tials requirements for jobs, 'gerrymaedering ofpoliti I jurisdictions, and poor quality services of all
combine to severely limit the .uccess of minorities to the resources they need to improvx their own
cobdition and that of their neighborhoods and cornI

mun i ties.

In the short term, it is essential to put unemployed in addiltion to structural institutioti'al !Terriers, there
urban youih to work on public service jobs. :These is ample evidence that intentiOnal, motivated, explicjobs can be directly. related to enhancing'their skills it racial discrimination continues to occur throughand ability to compete for mainstream employment. garthe cOuntry. This evidence inclOrles housing disPublic service programs should also be used to incrimination cases prgetTlitite by the Department ofprove central city capabilities to supPort economic -Justice involving outright refusal to rent or Al toredevelopment, i, improvements to streets, utilities, mit orities, coding records to show racial prZillinces
living environment, neighborhood attractiveness. Such work should be affirmatively combinedparks,

with out-of-sphool effOrts to eliminate functio4 illiteracy among out-of-work youtjiand to equip themindernental Working

with both a work ethic andto la dlords, selecjive advertising, instructions to sales
personnel to steer minorities away from certain areas',
as well as racially based thregils of refkrisal. It is
instructive to note that the'Justice Department prosecutes only those cases involving d.isrimi'riatory piaclices which: in its judgmenti, are widespread.

Placement of Displaced and Structurally UnemployedInterviews with employers as well as enyloylk in-For, out-of-work youth Capable of)pirrg-tirt to private
emplqyment, .there are ample uhcommitted Federal
youth employment funds to support cooperative gm-

dicate that the same motivated discrimination exists
in the job market at it exists In the housing market.
Independent of .education, Tinorities suffer higher
unemployment rates, and lower 'incomes pan their.0Athe refusal to extend credit to minorities for'White counterparts. Minorities are systematielly excluded not Only from employment opportunities, but!ties,

from promotion opportunities as well, as is cooly

the refusal to make any loans in certain geographic
areas (fedlining), and the designation of certain areas

indicated by -the Department of 4estice caseload in
ornpleyment discrimination. MinOrities continue tobe grOssly under-represented in the top professiorld
cotegorie% and 3his is not for a lack of credentialed
minbrity candidates. In one Southwest city, no major
law firms have hired available black attorneys. This
greater or lesser extent, 'inpattern is repeated t
untry.
city alter city tekm.t.
There afso is evidence that racial discr iminat ion is in-dependent of income. Holding income cpnstant, the1974 Census Bureau tabulation of the characteristics
Of low-income hor)feholds shows that 8.4 percent ofpoor while iarnilio).et*e in low-income areas ofcentral- oibes whilee40.4 percent of poor black families live in_sOch areas. Also, a 1974 study conductedby the four,Federal financial regulatory agencies con-firmed that a higher rate of rejection ofininority
applications by mortgage lending institutrons
curred at all aroma levels. The higher rejection rateoccurred -even when the number of Kezs applicants
were in their [resent positions remained constant. It
occurced roga less of the level of debt.. It else Ocf the apnlicants' total assets and it
curretlAgardles
quests of all amounts,
occurred for boar

homes in residential areas occupied by nonminori ties,

asthd'' on)y ones in which 'loans will he made tominor i ties.

These var ious for ms of housing mat ket discr imination

are at the root of other forms of racial deprivation,
They have distorted patterns of urban growth, cut off
minorities from access to growirg suburban employment morkets, subrerted ef for ts to desegregate publicschools and edualire the quality of public school edu
cation, cruised inequitable distribution of the bur(Jenof providing essential services to lower-income urban
populations, and contributed to the deterioration ofmuch of our urban life, Also, discriminator )s. mortbege lending practices taw) restricted the home ownerShip opportunities of middle-income minorities,
thereby subjecting them more often to higheiihousing
costs and inferior housing and denying them a princi
pal means of saving and accumulating w th
The Federal .gbvernment has played a role n the.crea,

for 3 to 5
who had been in their present oc.r.,u tt
years were rook:tad at a -rate almost double-that for.tion of segregated residential neighborhoods. In its
1971 report on the racial and ethn-ic impacts of the
235 program, the U.S. Corrmission on Civil, R ights
found that te traditional pattern of separate and unequal housifig markeVy for white and minority lam-,ilies was being perpetuated. The Commission, instudying thézprogram for four cities, found that ne
235 house° Was in most instances located in subuibctrt areas and 'nearly all wAs:Ibeing purchased bywhite families. To the exten1 Anorities purchased

nonminorities. Among the applicatioos from non
minorities with debts totaling $5,000 to $10,000,

new_235-41. busing, the houstng was located ,in subdiv6ions reserved exclusively for minority residence.

Rejection-of ap 'cations for mintirities earning from
$15,000 to-425,000 was 50 percent higher than for
ritiosnonminoritiek earning the same amount.

orilyr 18 percent were rejected, although fully 39 per-cent of the .dininorities pith hat level of debt had
their atiplications rejecteda rejection rate of morethan twiee that facing nonrninorities. Similarly, 25
patent of minorities with assets of $20,000 todenied loans, qs compared with only12
percent of nonminorities with suchassets. Thirty-one
percent of applications from minorities for loans of,$2,500 to $5,000 were...rejected, but only 12 percent
of applications from nonminOrities fOr loans of that
siZe were rejected, revealing a rejection rate forminorities considerably more than twice that for nonminort les,By contrast, in all four njetropolitan areas, most of
the exiting 235 housing was located in ghetto areas
or changing neighborhoods in the central city end
nearly twos being purchased bY minority families.
In selecting sites for Federal facilities, the Federal
government only recently has begun to give priority
to communitle3 with an adequate supply for nondiscriminatory housing for Federal employees.
Minority business participation in.SBA's regular business loan program deelined 'at a greater i-ete from4 t 1975 than di total participation
fiscal years

during tha time. 20 percent, c mpared to 14 perthere was a disprop rtionate decrease in
ie-nt).
A
Much f the disciiniination against rrnohlitics which-PartNation
as,Goverr merit contractors (aminor;
rainedinoccur in mortgage financing is deepl
forminorities
of $3 milliort, as compareq
decreethe, ractices which are followe by banks, savings
overallincreasein procuremerit of approxiand loan institutions, and indeed tn the criteria Ob- with aserved by Federal regulatory institutions. The types maiely $30 billioh).
Of discrimination which occurs vary and may include,for.example, outright refusal to make loans to mirror;

74

re'

69

I.

2. Reoponding to Ecoriomic Troositiori

70

5"Federal policy changes Cannot rehrso the locationalborhood decay. While they remain fiscally strong,

impacts of many basic trends In the economy, butthoy should help regions and localities cope with tha
adverse impacts of these trends, shift from one eco-thoir poor and minority residents of ten are trapped inghetto areas. Today, older inner suburbs are exporl.
encing the same problems as the-central city.

nomic base to another, and take maximum tikivantageof thoir economic strengths. High priority attention
in Federal policy and actions rhould be directed to.
ward caress and communities in distressdeclining
central cities, rural areas of high poverty concentration, and woes suffering from acute economic dislocation."
Dr. Charles E Bishop, President of the
University of Arkansas
Summarizing some workshop deliberations
at the White Hquse Conference on Balanced
National Growth Economic Development,
February 2, 1978

Thus, while mosAties in Ole country today ale notin distress, mony have problems, sonic significant,that can lead to distress if not dealt with early. For
example, of 152 cities examined by the Urban Institute for population loss, income growth, and increasing unemplOment, only 19 were -found to bo doing
wall in all throe respects.

In some c\ities, such as El Paso and Macon, where
noticeable population loss has -not yet begun, highunemployment and low growth of per capita income
neverthelqss prevail. On the other hand, some 'cities
with unemployment rates below the national average.

inAs tho President's Urban and Regional Policy Grouphas pointed out, many Amoricah citios aro reasonably ilk
healthy. their economies are growing or stable andthey appear able to manage whatever population andeconomic change thoy are experiencing. These cities
do not yet have severe problems. They usually cancope with the difficulties theY face. Many can annex
new territory to encompass newly developing areas

1976dties such as Cicero, Huntington, andKansas Cityhave suffered both population decline
and stagnating per capita income. Ci ies such as
Seattle and Long Beach, despite healthy ipereases in
por capita income, have encountered population loss

and high recent unemployment Even some cities

and tax base.

witto job, population and income growth have shown
above average unemployment ratesthough in many
instances, many of those out of w9rk have been without a job only for a relatively short period of time.

In Growth the Seeds of Future Problems

It is in the national interest that all cities' be assisted

Even in such communities, however, conditions exist
that, in time, can lead to them to repeat the e,xperience of the older cities already in distress. Some-01these cities, such as Houston, are experiencing pollu-'
lion problems and some concerns are developing overrapid territorial growth and its long term fiscal impli
cations. Honolulu has experienced smog alerts recently. In many cases, growth itself, which brings so many
benefits, also brings its problems. In recent years, newhousrng production in many rapidly growing areas has

isprouting irito full-bloom distress.

in forestalling the early seeds of problems fromThe Symptoms of Severe Distress

But it is clear that a high priority must be placed
upon helping those cities currently suffering the mostacute distress.

In some cities the entire spectrum of urban distress ispresent:

barely kept pace with demand. Uigh demand for
housing has inflated hotting costs. Annual out-of-

High unemployment, population loss, increasing rela-pocket housing costs tor homeowners in Houston, for-tive or absolute concentratio4s of poverty, severe

example, grew by 49 percent between 1973 andfiscal strain.

,1975. In Pittsburgh, those costs went up only 14 percent during that period.

The need for housing in growing areas is most often
satisfied with sprawling residential developments.

Settlement patterns often neglect environmental considerations and frequently wasteland and energy.

Some areas feeling the strain of rapid growth havereacted by imposing stringent controls on development. Despite reasonable' prosperity, most larger
41ealthy cities contain pockets of poverty and neigh-75

Social and economic difficulties, enviromOtal pollution, neighborhoocf and housing decay Oen strike atonce, paralyzing the city's ability to make ends meetand respond to the legitimate nkedsof residents.
Attempts to solve one problem often make others
worse. The result is a city in distress.

Nationwide, central city population fell by less than 1
percent per year in the firstpatf of the 1970s. But the
average population loss of the top ten cities on a
"distressed list" prepared by the Urban Institute wasmore than twice that fast, exceeding two percent lastyear. Several distressed cities are losing populationeven fasterSt. Louis lost nearly 11 percent in justthroe years (1970-1973). And cities such as Buffalo,
Cleveland, Pittsburgh,ond St. Louis lost more than
one-fifth of their total not population in the 13 years
from 1960 to 1973.

As populotion has declined in the Nation's troubled
cities so has the number of jobs. Cities with highunemployment rates and declining population havelost significant numbers of private sector jobs.

Chronic unemployment is a signficant cause of poverty in distressed cities. But unemployment is no the
only cause of poverty. Many of the poor ore womenwith young children, unable to Work and without a

They must curtail the processes of neighborhood
erosion that are accelerating abandonment and emIbark upon residential strategies at the neighborhood

level that will restore the sense of community andat(r act now middle and upper-incomOhouseholds in- to the city while enabling existing neighborhoods at
all economic levels to stabilize and even improve thequality of life and housing. Federal and state assistance will be necessary to enable such efforts on alarge scale.

They requirsi emergency fiscal assistance fromFederal and state governments to enable them to om
bark on new initiatives aimed at restoring some economic self,sufficiency. If they are for cesiAo fall backupon .expedient measures of ttrir own.for lack ofFederal and state aid, they canhot escape from thecycle of distress in which they -currently-find themselves.

dependable source of income.

Poverty S.4 found in; nearly all cities, but its relative
concentoiribn is increasing in cities experiencing theother signs of hardship. Nearly 20 percent of all residents in the 'ten most distressed cities identified in astudy by the Brookings I rotitution were poor, ranging
from almost 15 percent in Buffalo to need/ 26 per-Finally, if their long-term fiscal problems are to
be solved, majot state action is called for, wit
Federal encouragement, to modernize the structure_f inances,and service responsibilitkt of local governments in Nban ardas.'cent in Nyw-Orleans.

Because of the impact of modern production techgologies, communications, and transportibon upon-*le roles of cities in our economy, many cities andthe urban areas of ev4ich they are part, are in transition from the old employment base upon which
they grew and developed in the past to a new one
that more accurately reflects the developing patternsof employment and location in today's post industrial
economy. During the period Qf this transition, theyfind themselves caught in a vicious cycle: they must
m9dernize their facilitievnd environment to meet,-the new conditions in our eZVCortiy, but they lack thetax resources to do so. Because they are losing employmertt and middle- and upper-income population,
their tax base is deteriorating. Yet because the Riletive concentration of poor is increasing, they find jt
necessary to provide services which the poor cannot

support out of taxes, To sustain the services 'Tra'theface of rising costs, they curtail capital expenditures
to modernizeand maintain public facilities which further erodes their ability to attract new investment
and jobs whieh can provide the only long-term solution to their problem.
,

0

ClearIN,i, coherent systematic strategies are required tomeet the prOblenikof these communities in transition:
They requireT ederal and state as well as private
assistance in mbving forWard with long-term ef orts
to restructure their economic base and become
kpetitive once again for private investment

44

3. Restructuring the Urban Economy

72"I am convinced that an industry moves to a locationor remains in a locationbecausa Of the willingness of a lOcal community and a state to cooperate In
over-Coming problems and not because of legislative

manipulations designed to force an industry to staybear on major .oca. projects;

A one stop point of contact for local government
and private investors and developers on economic*put."'

development mat ters,
A 1.)alanced business tax structure that encourages

Governor George Busbee, of Georgia
Before the White House Conference

business retention and modernization as much as it
favors the eitract ion of new firms;/VIM Of state banking tind financial regul dont;that f vors rather than deters access to investment

on Balanced National GrowthandEconomic Development
Washington, D.C., January 31, 1978'

A state development agency or cabinet capable ofbringing the full resources of state government to

Until recently, few municii:alities assumed that economic development was a significant or necessary
coricern of city government. Under .the pressure ol
events, that circumstance is changing rapidly andsome cities and metropolitan areas are developing
highly sophisticated tools and mechanisms to promote their economic redevelopment, nearly always
involving joint public nd pr Nate planning.
Frequently under sta e enabling legisiation anti With
active state support, city-wide development corqra
tions, regional' development authorities or agenqies,
industrial devetppment authorities, new cjty and area
ro coOrdinato tiaining and economic
developmentall are being tried and tested in cifies

mechanism

onq rnetrb

litanpreas throughout the country.
94%111-410(.

Cities in transition are rapidly ..recognizIng the needfor a cornprehensive set of capabilitie to meet the
special challenges they confrOnl in diversifying andexpanding their economic hese beyond their past specialties, To varying dogrikes, these efforts are evolving
toward such captibilities
The ability to simplify local decision-rnaking on
economic development projects,
Tha.ab i I i ty to hold or asseMble land;

The ability to provide .long,term, lbw-cost mortgage financing;

The ability to engage in risk-sharing thr0 co-

capit

;

A sot of state incentives, guarantees, subsidies,and low-interest loans that reinforces ah`d comnlements the powers provided to tho local agencies.
4 4.

A number of Federal incentives have already begun toencourage greater public and private cooperation inundertaking comprehensive economic development
programs in urban areas that are in the throes of transition. The Economic Development Administration of
the Department of Commerce has provided planning
grants to a group of cAtinssat tempting to coordinate
manpower, economici development, and capital
improi/ernent planning through cooperation betwee
the public and private sectOrs. The Urban Development Avtiorr Grant program repiesents a significant.
new irtitiativein oncoaagin4\ major projtIcts,
inscope,
comprehensivethat` require cloSe
cooperation between private and public leadership..
Improving the Availability,of Capital for Urban Investment
To successfully reverse the timid toward urban disinvestment, special incentiveseare required in the earlystages of ui ban redevelopment to rnakd cities in transition competitive for new investment. A redirection
in some of the flow of investment toward these cities
will require some intervention at the Federal andstate levels to make investment in these areas competitive in risk and return with investments elsewhere.

ven tur ing,

The ability to provide fiscal financial incentives
such as tax abatement in exchange for desirable develdpment;

The abilisf to obtain cooperative services andcapital improvemerits in conjunction with development projects;
TI2e ability to coordinate economic developme9t
with housing improvement,"ate Actions
In an increasing number of instances these efforts'have been accompanied by state efforts to establish:

Capital for Neighborhoods

Renovation of neighborhoods in urban areas requires

funds, but individual unito*:)...inlier city neighborhoods have not in the pa4 apPeared to be attractive
investments to private lenders compared to suburban
locations,. Today there are some enimples of commitment ond innovative arrangements among government officials, neighborhood residents and financial
institutions. Many financial institutions are lending'skilled personnel to - neighborhood preservatioP
tf forts. Financial pools designed to spread-the risk 1--iy
rehabilitating declining neighbOrhpods , are being
a

.40

4

forMed by financial consortia I n Chicago, one of ,thelargest savings and loan institutions heal-called 3.1 ori . mayleading financial and legal consulteotsi, as well as

1-munity activists, to develob proposel1 kir ondertaga new ond close relationship between downtow

73

1oi4;land assembly lod other "front end" costsaS significant tiS construction and vporating

Physical end Economic Development Component

lending institutions. arid promising neighborhoods.

Cooperatively, neighborhood improvement is occur . \While population and employment decline in the corering where on an individual basis renovation probably 'urban areas is certainly perceived as a problem, thecould not have proceeded. The risks involved In such physical and economic development component of andone over urban strategy must be designed so as to take advaninvestment are rraduced when reriovior
lion
of funds tage of population loss as an opportunity to restruca multi-unit area end when the contri
ture the city physically and economically.
berof
firms.
and insight are spread over a laCapital for SmagLfirms/

NeighborhoA and entorpriseS that are still viablekand not yet in conditions of advanced abandonment
or decline must be protected, reinforced, and assisted.
will have little trouble raising investment funds Isioteji ut areas and facilifles already abandoned should be
frepargd for converskin to totally new functions
long as theAms are profitable. Small firms, on tother hand, ge'netally find it more difficult to obtain appropriate to the future economic and social role
funds and are ordinarily limited to local. lenders. they role play in p...Aost-industrial economy: AbanLarge firms, no matter what their locations( probably

Smaller firms are much More likely to find in-citysite3 attractive. Thus, incentives to attract investment

inV cities in transition should be tailoted in- part toencourage private investinent in smallersnterprises.
,

There are two\ very different types of small firms! which require somewhat different 30proaches---`those
whose market wip always be smallfor example, local
servidb providersand hi h-growth potential ventureI
capital firms.

doned properties slowly drifting into pilblic ownership through tax delquency should be replaced withtotally new usescommercial, residential, industrial',
recreattorpl or cultural.
rviews conducted in major cities in conjunction
w h this report found a pervasive concern over the
gro ing amount of either abaodoned property or pro-pert

not currently being used for ryresidenti

corn ercia

or industrial purposes. Present pric,or'such and r main high. Usually it is in sc8ttç plots,
e forlargeSmall firms have sometimes found it difficult to raise with insufficient acreage in any one
scalecommercial,industrial,or
residential
deyelopcapital 'because of restrictiVe state legislation or costly
filing rules. Entrepreneurship, management, and tech-j

nical skills have not been widely enough nurtured.
Improvements in management skills would make iteasier for these-srhall firms to raise money and stay inbusiness.

(/enture capital fundslom large financial institutions
have been limited by Federal regulations. For example, prior to the Employee Filetirement Income Secu-

rity Alt pension funds either directly or throughventure capital companies wve a source of verCture
funds. Sixty-four percent of "piension trustees surveyed byottce International Foundation of Employee

Benefit Plans in 1076 reported that as a result of
the 1974 pensionaw they were less willing to invest In anything--other than blue-chip Investments.
A change in the "prudent man" rule to have it apply
to the entire investment portfolickrather than individ--Aral investments would make it possible f6r thesefirms to provide venture capital funds again,

ment.

Several steps appear to be in order to accelerate therecycling of land in the cities to new uses:

municipalities should adopt legis1. The-states
lation expediting the process by means of which tax-delinquent properties pass into public ownership. The
proms is needlessly protracted in most states at thepresent time.
2. The states should adopt legislation permitting land,banking, including the use of enicent domain, inareas candidate for conversiorkppik uses.

3. A /Piderally chartered develoPment bank orstrengthened "new town-in-town" program might beestablished to aid in firancing and redevelopment..
4, A comprehensiVe study of state land use laws andincerrives for facilitating land assem4 should be
carried., out. The study should include two major

Lar:ger ecole investments wHI require still other stVeand Federal incenti;es end approaches. In such cases,., elements:

78

4

4

74

I nceniivos encouraging private land assembly suchas tax incentivcs, zoning techniques and principles,
direct loan programs, special procedures to quit titles,
and safeguards against the abuse of incentives.

Public land banking. Hero the study should con-cern itself with the definition, of "public purpose"-

A fourth land conversion and reuse priority, therefore is tho development of recreational, cultural, andaesthetic amenities jhat resurrect a city's ability tofinancing meChanismt, leSt-than-fee atquisitions, thet.ISe." Of 'tdic 'delinquency proceedings, and operating

COmpete aS

principles and safeguards,* Major problems lie in the

Averaging Private Investment
with Public Funds and incontives

admipistrption. of a lend banking program. Techniques of acquisition usually involve a number ofin -Nth. the city and countythe tax collecttgenciev
br, the shal'iff, the county attorney. the zoning ad
ministrator, and the renewal agency. All of thesemust 00:.(20Orditlated, perhaps thrpt* a special le dbanking egenCY or a.develOpMeht ørporotiorrith
broader responsibilities.

Development and Redevabpment/6

App r priate new uses of specifi$ sites will, of course,from city to city. In some instances, new uses
for the immediate future may not be ascertainable. In
such cases, assembled sites might be held in .interim
uses such as parks. Every..care ;hould be exercised to
avoid maintaining assenpled tracts as empty spacev...)

as such trends accelerate, this development should becapitalized upon.

Pthce in which tb live.

Obviously, tho physical and economic restructuring
ol these older urban areas will require major improvements in capital -facilities and municipal services.
Clearly, deterioration in the tax base prevents the useof large amounts of local public funds jor these pur-.
poses, but with changes in Federal fu6ding formulae,
many older cities and Suburbs -wirl.be receiving large
amounts of counter-cyclical and urban development
funds. These should be used to upgrade the facilities
and services Witt will support and encourage private
investment. Present evidence Indicates that few cities
are effectively using these funds for that purpose. Yet
I9ng-term .solutiOns to the problems of transition depend upon doing s000perative public-private planninq in each urban area to make maximum 9ffective

down further in surrounding areas.

use of this Federal assistance is vital. Urban Development Accion Grants can further reinforce'such efforts
to use public dollars to leverage privAe investments.

A wide range of tools can be made available understate legislation to assist in the develownent of new
industrial, commercial, and residential development.

Effective use of revenue bonds, mortgage guarantees
and mortgage insurance, direct loans, and tax incen-with no public use. ThiS will ogly drive' conditions

tives will be essential in enabling private firms toEfforts should be concentrated upon attracting newly
developing sectors manufacturing based on newer
teclinologies thatstHI have expanding employment re-quiFemtrts.. Sh firms are of a size for whir urban
locations can still be competitiVe.
Where practicable, commercial projects should be4-

locate in these central areas. Already, there is ample
evidence'that older, abandoned structures can be converted effectively to new uses. Several states alreadyprovide incentives to promote modernization of industrial and commercial facilities. These should be
supplemented with similar incentives to facilitate conversion and rehabilitation.

phasized that "export" services out of the city. Thishas the advantage of reinforcing the economic base of

the city and will yield higher multipliers in "spin-off"Idyment than local-serving coMmercial prdjects.
success of development and redevelopment will

Through the physical restructuring of areas suitablefor economic development, urban areas in transition
can take the first step toward attaining a viable newbase Of activity, though, quite possibly with a lesser
population than in the past.

de end upon the up-grading of the city from simply
serving as a workplace into a more diversified environmrt for residential use as yvell as work.

The second step is to rest-676 the sense of community

by stre5gfhenirm the community'S social fabric: its
neighOrhoods.

Residential projects that help diversify the mix ofincome groups and strengthen the tax base also delhigh priority. There are nascent trends amongch less truSeholds to move clOser ta*the ientral administrative district. While it will 'be necessary to,guard:
st displacements of low-income residents.

794. Restoring the Sense of Community"If the neighiorkoods of our cities dig, then our,cities go down thg tubes as well becabse Our cities arenothing but collections of neighborhoodS."

DrA;Arthur Naparstek,
can democracy
member of the President's Commission on Neighbor-hoods, wrote in a paper for the White House Con
ference on Balanced Growth and Economic DevelopMOM.

Mr. Bernie Jones, Capitol Hill
United Neighborhoods Citizens Forum,
Denvef, June 27, )977

"If the city is to become a com nity," Lawrence
Haworth observed in his book, The Good City,
several years ago, "then the inhabitants must identify
the settlement itself as the focal point of their lives."

Yet, as the Nation's communities have grown fromcity into metropolis and metropolitan area, that senseof identity between citizen and community has beensteadily eroded.

is founded .on the division of
An urban econo
labor, each citizen performing specialized r,les, As
such, our urban areas have been the source Of oppor-

catunity and diversity in our national lite. But in oflering these iiotentials, the metropolis has too often
thereby lost its sense of community; its sense of common purpose. "We have only to reflect that the historical period during which duty and obligatioet havebecome de-emphasized in human settlements is also
the period during which community in the settlement
has dissolved," Haworth.has commented.

Governmen l. and public policy have played a criticalpart in further weakening this sense of community.
The centralization of public services removed government from daily coritact with the lye ef individualS,
families, and neilghborhoods. Urten renewal and theconstruction of highways sometimes destroyed thesocial fabric that held whole areas of a city together.
Programs, conceived in standardized molds out of

touch with daily life in" the community, undercut
local morale and fi-equently produced results almost
exarly the contrarti to whet Was intended.
Much of the deterioration in urban areas today can betraced to a loss of the sense of community, of com-mon'interest, Of citizens' faith in each other, and of
pride. Where these ties that bind individuals and families together still exist, deterioration has been fore,w,ithin neighborstalled. Those ties ace,hoods. Neighborhoods Eire th building blocks of theurban community. To the extent that they have lost
the teen4" of shared interest and pride, our urbanneighborhoods are declingIng; to theextent they tave
kept or-regained it, they are stable and vital,"It is the neighborhood that permits a strong social
fabric and the medieting institutions that de Tocqueyille hailed as the social milieu within which Ameri-,"It is easy and fashionable to blame the when plightentirely on the demographics, but there ant Multiple
examples of communities where vital, well organizedneighborhoods ave flourished In the face of poverty,
low education and apparent physical blight. Well inipts to address merely the cold datatentioned awith bureaucratic income transfers, delivery of serices' or razing apparently blighted buildings-often
failed to understand the social structure of communi-

The bureaucratizatiop of functions performed best at a local scale, saps a community's
ties . .

.

natural coping mechenism, defeats volunteerism, promotes a/lanai:1bn"

In addressing special attention 16 the problem6 ofurban cqmniunities in transition, national urban
policy must seek to achieve a deftness and sensitivity
rarely presert-IrrrFederal efforts in the past. lrt

seeking help to restore the human fabric of urban life,
it must recognize the diversity among neighborhoods,
their _needs, their aspirations. And it must come torely upon the restoration of a sense of community tomeet some of the most intractable problems of urban
Ilfe.

Street Crime

In the early 1980s, it is quite probable that rates ofstreet crime, school violence, will decline as-thenumber of teen-agers in the population dro0,§ alongwith school enrollment.

Street crime in the cities is in part the result of joblessness, in part related to the breakdown ,of family
life among welfare fannies, in part relatbd tO the dis-

proportionately high number ol youth in the warbabies generation, in part the resull OThban social
breakdown and alientation, and in part the result of
the disappearance of vital economic and social activity from neighbohood streets. As many urban critiGs
haVa pointed out, s ctureS and social patterns thatcreate unAtched, cant streets are an open invitation to crime.
MOre police cars .and -.Wit:me-Leven more stringent

punitivl measures Ili the criminal justice syste,--do
not resolve the underlying disintegration in social andneighborhood life that sometimes manifests itself incrime and social alienation.

\

f
I.-

76

One promising long-term answer to crimo in the city
is to restore the sense of community and social andeconomic vitality in urban neighborhoods.

Each category rolquires different assistance, different
approaches. In slme, housing is im good condition, in

Coupled with long term economic redevelopment,

tial, anneighborhood based programs involving city residents
themselves provide one alternative to reduce sPeet

so faroadvanced that demolition may present. thoothers modost repairs are required: others require
rnent; in others, rehabilitation is essencode onors, deterioration and abandonment are

wilt:1st course, with the land converted to new housing

crime and violence in the sChaols. In all but those or other uses,
neighborhoods in the most advanvd state of abandonment, there are parents and olher adults deter- The precise mix of policies and proprarns required tomined tcr improve the public safety. In no sense an deal with these differing situativis must be deter"underclass," they proudly aspire to improve life for mined at the neighbor hood level AU be supp&ted bysensitive program administration at the city, state,, their children and grandchildren.
.

Neighborhood street crime is not-high in many Older

7

city neighborhoods, particularly ethnic areas and_areas with a high-level of civic prido. Street crime andvandalism are low where.there is neighborhood pride,
the social pressure of Peers, and sense of common
interest.
Stabilizing and Revitalizing Neighborhood Housing

As a study recdntly completed for the Department of
Housing and Urban Developme
suggests, healthy
their future thatneighborhoods have a confidenc.4

derives from stable demand on the part of new

and Federal levels. States and cities across the Nation
are now developing :&ich programs.

One approach involving all levels of governmtnt,,citi7e1)5 and the private sector is exemplified by the
Neighborhood Housing Services Program of tho FedHome Loan Bank Board, the Housing
eral
Beinvostrn-ent .1 ask Force, and the Department of

Housing and Urban Development. The program brings
all the parties involved together in a common partner?
ship:$
the neighborhood residents who want to improve
the area:thegovernment willing to provide needed

residents to fill normal vacancies at turnover. Sudden

public services and improvements; andmoves into the neighborhood by "newcomers" dif-a group of financial institutions that agree to reinvest in tho neighborhood by milking market-rate

ferent in character from those already there -whether
higher income professionals, communes, or welfare
familieswill trigger an exodus. If disinvestment setsin, demand weakrs, neighborhood self-image drops,
and more serious deterioration begins, leading all too
often to housing abandonment. In numerous instances, Federal programs themselves have been responsible for destabilizing neighborhoods.

Nowin the face of increased -demands for existingloans available to qualified individuals Or maklng tax-

deductible contributions to the program to support
its operating costs.

Such partnerships, locdlly based, but with thd ,resources of government at every level at their disposal,
offer a promising model for helping to facilitate redis-

covery of the sense of community in urban neightlorhoods.

urban housing in some neighborhoods by middle- andupper-income groups, ,the desire of many longstanding urban neighborhoods to preserve their character, and the desire of low-income neighborhoods
find stability and curtail abandonmentnational
housing policy must become moro adept in providing
Nrent stages of improvement, stability o dechne, andconsisting of residents of widely ver>in means and'To advance toward more widespread neighborhood
renewal and preservation, it is important Mat community organizations, formed to strengthen the tiesof shared interest, improve social conditions, and upgrade housing be encouraged and supported at every
level of goverAient. Community Deve)Opment

needs.

porations, neighb*ood advocScy groups, neigh--very different forms of aid to neighbo oods in dif-

1,

Thery4re examples in- nearly every metropolitan aroa
of neighborhoc%cis it3 the advanced stages of deteriora-,

Supporting Neighborhood Organization

tion and abandonment; of neighborhoods of every
income level that are .reviTalizing; of peighborhoods

that are "gentrifr/ing" through an influx of-upperIncome h-Ouseholds; 'and of lop,g-standirg neighborhoods that are stable, cloge-knitend Proud.

borhelod housing improvement organizations all havea key role to play in rediscovering the sense_ of community in our urban areas.

.6. Resolving Final Dilemmas"Interdependence was affirmed when it was immediately and continuously recognized that this Nation
cannot cut itself off from its older urban and agricultural communities as though the human and physicalcapital they rephisent had no use or potential worth
their reckoning."

largest cities in the Nation declined by 23 percent
between 1976 and 1977. Moreover, fiscal deter ration was most rapid in the most distressed/Sr thes

Dean Paul Ylvisacker, Harvard
College of Education
Summarizing spme deliberations at theWhite House Conference on Balanced National
Growth and Economic Development
February 2, 1978

cities have chosen to cut back their investment intheir capital infrastructure. In just one year, 1076 to
1977, nine large and severely distressed cities cut
back their capital spending by 17.2 percent. These
reductions further erode their ability Aboth attract

It is inevitable that, as population and the economic
base in. older *ties and suburbs _decline and costs ofpublic services ge up, urban communities fti transition
experibnce severe fiscal distress. That distres6;pard-

ita the 85 largest metropolitan areas, personal incomes.

the long-term recovery effort they\ now must
undertake. It is imperative that such jurisdictions receive sufficient Outside aid during the period of eir
economic transition to enable them to cope WO
lively with the challenges of long-term economic andcommunity -redevelopment_ If left to their own fesources, they are compelled to resort to expedient inorder to get from one budget year to the next; and,retrenchment in some expenditures actually impede

their residents.

izes

large cities, i.e., those experiencing declining populations and skittering I ro in hi unemployment rates.
1pese cities sulfured a reduc n in theii budget sur.
pluses of `.,32 -percent. Increasingly, many distressed

new private investment and retain what they' have.

grew almost twice as rapidly in suburbs as in, cities
between 1960 arid 1973. The property tax base of
the cities grew .more slowly than did the income of..

Annual Rates of Chlimge In Fiscal Capacity Indiclitors 2'
1960-1973
nweighted overdo())
Total Income

Ratio ofControl City
Assessed
to Outside
OutsideValuation
Central City Central City Control City Central Cityetheir of for ts to reverse economic decline.
A

Bmaus,e of accelerated fiscal decline in many of the
Nation's older cities, it has been necessary to the Federal government to drastically increase the -flow ofgrants-in-aid to _these jurisdictions until, in sometool Federal funds received in fisccil year 1978
will equal more than 50 percent of the amount they-receive from their own local revenues.

These cities, like all municipalities, are creatures ofthe states, but they are in danger of becoming wardsof the Federal government. Such a developmept
would contravene many of the most Jundemehtal
principles underlying our Federal systems.

It is clear that long-term resolostion of the fiscal prob-

lems of these jurisdicti,ris rests in part -upon the.,

Cost s

1.9%

Mkiwest
South

2.74
4.98
5.4

West

,

4.08%
3.45
6.89
5.81

.56

7.35%

8.16
10.67
9.53

.42
,

,.65
.61

Source: Advisory CommIssion'on intergovernmental flotations, Tronds In MetropolIton Americo (Washington, D.C.,

A.C.l.R February 1977).

4,cal imbalance exists between most cities and theirsubk40.an neighbor. Signific,..antly, in -all regions, ex-

cepr the South, per capita nonschool taxes arid expenditures of central-citY governments roci much
faster than per capitp nonschool expenditures and expenditures of suburban governmEtrits. The decline 'HT
the economic b e of cities (as measured by assessedvaluations) h. proceeded simultaneously with an inurban economic well-being (as measured
crease inby per pita income). And the gap is widening between city, end suburb. For the 85 largest cities, theshoulders of&the states. they face the urgent necth-,
sity, during thOco,snp, decade, of modernizing Ickeral growth ratb in assessed value for cities has been subgovernment in ur.. areas, streamlining Its resporti- stantially below the broWth rate in regiOnal ipcome,1bilities, reassign' ! functions among juriidictions, andIncreasibg Costi
ncial base for local government.
altering the
Measures of Distress

The older urban areas confront an extrenielY dif ficult
dilemma: their c'oes are going up evert,though their

The Joint Economic Committee has viCently com- public payrolls grow more slowly than elsewhere.
Knd without adequate private sector expansion, they
piled the best available data describin6tfte'arerapidly wunning out of ways to meet these costs.
condition of large central cities. Thestl date Show thtli
the real Unencurnbered budget surpluses of 60 Off the

Yet the declining cities also tend to be high cost.

8p,

-

A

I.

f
414

.

.

ments. Forty-seven percent of the- high unemploy-among seyen 13rge growing .cities and 14 large declining cities plus New York-and found substantial- discrepancies between them in terms of rnOni6pal e*penditures per capitp, municipal employees i)er 1,000

ment local governments that wbre surveyed will enact
tax incmasets amounting to 3.5 iiercent of their com-bined budget. Sixty-one percent of the high unemployment lurIsdictIons will reduce current services byresidents, 'find the average monthlY Wage of muniCiPal
workers.
.

ida,

7 LargoCities14 Largo
Declining
Citlos$152$264

GrowIng
Expenditure; per.

Now York

Nearly all of those older .cities aro "land.locked," thatis, -surroundecl by other incorporated municipalities.
They cannot solve their economic and financial problems thrOugh territorial annexation As in the case of-newer growing urban areas elsewhere. The mature
citiesfate- a lbsing battle, with expenses responding
more to inflation than do revenues.

$ 396

capitaErnigoyees per
1 , 060 residents

Averadel monthly

13.0

8.7

$812

13.0

$1,115$958

amount equal to 3.6 percent of the combined
get for high unemploymentjurIsdIctIons: Thus,e high tmemployment local governments will makebudget adJustments equal. to 7.1 percent of- .theirbudgets."-

MuniciRal Expenditures in Selected Cities :

wage
4

.

.

The' PresidentA Urban and Regional Policy Group has

Perversely: among cities' studied by th,ect.lrban Institute for4he 1967-72 period, "vowing cities managed,,polinted out ,thet there was little or-no real income

growth in mdgt cities during the early 1970s, although dollen,' incomes -did rise with- inflation. In

to cut their .11tective *V rates by more than 25. while the deelining cities weze obliged toraise their rates by nearly
percent." Between 1967
and 173, large declining cities increased' per capi,tarevenues by 113 percent (compared to growing cities'
95 ,peraint) despite sloWer increases in per capita in-percent

manY of the diger cities, esppdally those with highunemployment, wages and salaries from private joi5s,..,'cities. One Urbtip Institute stuck compared ,cotts

accounted for only slightly more than .one third of-the net grOwth i per capita income. GAth in"-gov-.
ernment pay men exCeeded growth in priVm wtor
ost*Alth:
wages. En effeet, rge segments of the pOpulatitin, of ,..
the older large cities have become dependent orilo
More x..
istresem...4 cities are choosik to cut back invest..
ernment assistance.
merits In Streets, sewers,. and ihtir service faOlities.

cve.

Cutbacks En services an'd capital investment, severe as'
,

wo

4.

Local goveenments have reacted /o recent economic
uncertainties In many ways. -Most have depleted any
surplus they had. Many cut back on services or tried
to increase taxes.:The most troubled cities needed toundertake the-most significant budget manipulations.

they are, would be far worse without rectnt Federal
funds and initiatives to, provide jobs' ih 1,..)oth the

The Joint rconornic Committee has.reported:

Pits Federal goverement is providing and should con-public and- private sectors.

Fedetal Assittance.

Ipie to provide external aid to thesti cities in tran."In 1975. .-.122 of the 140 governments surveyed elf!'
Aired the fiscal year with a combined surplus of A940 lion in orcibr td'enable them to cope withthe longmillIOn, slightly more than 1. percent of their total
budgets. This iturplus has been totally depleted andit
expected to beir:deficit-of,$40 millIOn by the end of
the fiscal year, Consequeritly, Mom; local govern-:thents, without surpleses, will be forned 42 &duce ser-vices or to increase taxes In order;naintaIn balanced budget. Local goviihments wIll ;enact an esti-.

.

rm community and economic redevelopmpnt taskthat now confronts-them.
B'etween Januery,197:7 and Sek/ember 1978;the Fed-

eral goyernnient will disWrse $15.8 billron to itateand locagovernments in the forrii of emergency aid.
Three proxams are involved CETA Titles II and V1,

Meted $1.5,,ibillion in new taxes and all redwe ex- *supporting public service jobs; grants for local public,
penditures by approgImately $1:4- billion. The $29 works projects-that would not otherwise have been
undertaken; and countercyclical revenue sharing. Of
billion in deflatIonary'budget adjustments is approxithe$45.8 tilli6p disburs.ed Under these programs,
Perceni of the .combIoed budget for all.
.--mately
local governments.

$3.2 billion will go to the 48 largest citii*in theI.

"Once again, thehigh unemployment governments are-A
respOnsIble for .the vas; maiority Of. budget adjust:.

Nation, where thafunds will Make yp 21 percent of,
4Federal, aid and 2,,percent-of total local government
revemes.

3

c!.

lb

6. Modernizing Urban Governaient

e'"

vo-

'Continuation of present countercyclical assistanC:ewill provide substantial fisCal relief as it has duringsystem should recognize state differences and a'strong

the past se/feral years. Modifications isa ellotations for
such' programs and Community DeVetopment f3lockcommitment to the idea that a major rtsponsibility
for developing more effective and efficient govern-

Grants and revenue-sharing have also ;!notably increased Federal zid. For the future stroll
assistance,rnigfn be predicated in part on the pivportion of poor

mental structurres rests with state governments. They

residents in a jurisdiction who cannot contribute
through taxes to thp locat cizzsfV essential services'.
AFed

statiori,
ultianatto be reassistance can tindsh,

"There was very broad agreement that the Federal

cannot escape responsibility for adapting sub-state
government to the jurisdictional problems that are
miiving beyond the boundaries of r6cal.governmentS.
Only the states can resolve the servicing, fiscal, andjurisdictional quandry facing local- government in
America and the Federal goveriment mustiibcognize
this paramounklegal and political fact-

ild only be a way-er, to a more peranent solution. The

five must be-to enable any juriScliction
bly self-suffjciept in its ability tojinancelocal*services:::

Two forms of action are appropriate for die strIles:(1) to provide direct assistance toilistressed jurisdictions; and (2) to revise, the- financial fiscal. base of
local governments.
.
.

No single set of approaches will,be appropriate for allstates, but there is a national interest in effective kfate
efforts to resolve these problems and the Federal government should encourage such efforts.

States can and have assumed functional espoaTlity

ii.

....

Dr. James A. Norton, Chancellor,.Ohio Board of Regents
Summarizing some of the deliberations
at the White House Conference on
Balanced National Growth and EciAómic
Development ,re6ruary 2, 1978 'i

Qver the corpi 'g decade, the restructuring of local
government res nsibilities','financing, anti boundaries in -urban are experiencing. econ'omic transition
will be one of the !nest controversial land PoliticallY
difficult tasks° facing. 'state governMents. While theFederal goverriment can provide support andyncouragernent, only the states have- the powers_within our
Federal system-4 modify local goveranertts to meetthe new econorrilc and social realities that have emerged as our urban areas have decentralized,

Metropolitan tax-base'- sharing is an oPtion under
dis'ifussion ,in several states. As .employed in the
NoMeapolis-St. Paul metropolitan area, a r5ortion-bf
the increase iehonresidential Property tax is sharedby local governments within the metropolitan area.
This serves to both narrow disparities among jtfrisdictions in ttie4metropolitan area and,climinish cut-tiiroat -of very-. iMportant instances, the task of rOdjusting'the finance, responsibilities, and boundaricA of local
gOvernment to meet chwing 'service and 'develop-.
raent needs ail make alterations in the tax base'of
many urban areas. If such reforms were merely amatter of achieving greater efficiency in the "deliveryof public services, the continued fragmentation Of

c4peti1iön amowjurisdictions for new industry:lool government services and responsibilities in urban
areas would not be gravely serious, but it is increas-

.

. .

.d,

.

Though local governments are creatures of the states,
state .governments have avoided, except in a number

State review of property taxes isifffilikqd alternativR, Ingly cleat ttiat,the "balkanithtion" of local governporticularly with an eye to shifting ei-nphbsis toward ment resourcevand respoqbilities in metropolifaq_site-value taxation. State authorizetiorl for compre- areas is:an important cohtniautor to the deterioration
hensive inceme taxation at the municipal Levelpstrate-' anddecline of centrA cities and older suburbs,
gic pricing 'of utilitieS, and expenditure controls are.
Other courses states-ean 'take to help urbah juri;dicThe Problems of Rounder:les
Ld
7.

In the lin& Onalysis, hAeyer; states are likely to find
Op the rhost of fectiVe .alterhativespre .to Modernize
tht strilture of urban government itself.

1..

for soma-local services. Statewid gi. revenue-sharing isanothet course ,beipg adopted in seVeral areas of thedountry7 State categbdcal assistance-for:specific serv, ices and facilities is.still another.

tions in distress cope with their transitiorial':

79

As one, Urban Instittre expert put it in.'a 19770-C.10gressional hearsing:.

0v"Adherence.to oqt-of-date central city boundariel has
done more than capriciously allocate urban resources

a4.

.0

Aweent the central city and the rest of the metro- The Advisory Conimission on Intergovernmental)irea ih response it) the decentralketion of ---L.Wions has Temarked on this same matter that.

80

private markets. Once in place, the boundaries pro-

"It has not been long since cities possessed a taro

central cities."

measure of social and economic unity. Theset
commumty c(id encompa.ss within its boun.

0

The President's Urban qnd Regiona olicy roup
found that the allocation of responsi Mities between

virtually all the area's residential, commercial and In-

stfito and kical governrnerfts, to9ettaer with the bound-lop-income resideptial areaswere offset by the 'surplus area' with fri the city's boundary-,-the high 'tax
producin.districts associated with the central business area, the industrial section, aod the high-income
residential neighborhoods. These balanced municipalities were able to keep the public peece by moderating the.competing deniends a the various classes
that comprised the ctan body politic.

aries of local governments themselves, contributesignificantly to'the fiscal problems of urban communities in II ansition., City .boundaries reflect his.
nd political accidents and not current responnd problems. More;linitn 2,001:f loutl governm nts ex4,1Lin gur standard metropolitan statial,ichl
areas, an average of 841per metropolitan area. And,on thwaverage, nearly 200 separate govvernMents exist
in the larger metropolitan areas, those with More than
500,000 in population.
t (Xidustrial development. The city's 'deficit areas'the

In younger urban areas, especially the South and"0,t those days are pretty well goge. In many of ourmetropoliteh areas the twin forces of urban expansion and social segregation have combined to upset
the old balance and to alter profoundly the social andpolitical character-of the typical urban municipality.
Now communities are more apt to be lopsided, with-.
the pentral or core cities often becoming blacker andpoorer when compared to the burgeoning ecdnomyof the sprawling and subdivided suburbs, which oftenWest, where the .central ci-ty' is dlbt yet entirely stir.
'rounded by incorporated municipalities, fiscal strain
has been muted by additions through annexations of
neW -territory where new tax IZse is still developing,have *ecome wealthy estate and industrial 4nclaves or
predominantly white middle-class bedroom.communlties. The political leadership of the earlier balanced
community!was uhder conitant pressure to conciliate

thus "capturing" the suburbanization* process.

the conflktio demands of the various groups within
it; in contrast, the political leaders of the new metropolitan communities are virtually forced by the interests of their narrow constituencies to sharpen andreinforce the differences that made up each community in the area."

Frajmehtation haS itklpeded area-wide cooperation,and fomented inter-jurisdictional competition for thetax base, Reliance en the property tax fosters cornpet itibn,for new development:, .

Growth in Assessed Value as Percent of Growth
in Regional
Personal IncomeCifies Over 150,000_
1960-1975

1960 1970
4-,)vide a further incehtive to outmigration from theRegionMean

Northwest*
Midwest
South
West.

58.4
67.6

.9

72,1

86,3

Mean
.

43.6
49.3
60.0
77,3

Fiscal 6isparitiesr

The most fundamental Consequence of iragmented

Table pre-parod from data prepared by Dr. Seymour Sacks : *governmental structure in mitt metropolitan areas isof Syracuse University. It relates tax base growth in citiespmismatch between needs and fiscal resources. A
ho Income growth-In surrounding areas. In all.regions,tax
ballZanized urban ta>.c base, combined with forcad rome growth In cities hqs been-slower than income grdwth non-central city areas. Observed stahdard deulailOrSs
lianc of many Idcargovernments on the local proper-

su gest significant variations by city exist ln the West,

Midwest and SO.uth.
t.

Rut annexation is not an bption for many 4older central or suburban cities. In cor(sequence ). as the Joint
conortfic" Committee observed
its ieeport on dity tax,, ha left some local governments wpowrising
service cost's -and deteriorating revenue?. 'Clearly;
larger and ol r. Len tral cities in'the- litirtheast.Ande most severe harcAips: Most have
MiclVest facelong been-"land- ocked" by airrotindingjncdrporated,

tressed cities:"The old' city boundaries have been left-to encase
aging and unflerutilithd capital stock, Whose valve isfalling In' real terms, as well 'as aleclining populations
that contain, a large (and growing) share of economic

8,

Growth in Assessed Valuationlp
Central Cities.: 1960.1973 ;.

Northeast
Nor
entre!
h

N

1.96%
2,74%

.
^
.

dependents for whom publk servicg provision is

testunusually expensive."

Source: Seymour Sacks

.

- ,-

-"I

,

498%
5;40%,

,Lmunicipalities. Their assessed valuation has grpwn
very slowly since 1960, far more slowly than cities in
the South and West. Many, particularly those facing
high unemployment, poverty and population decline.
have _been _forced to raiso taxes or cot services, orjurisdictions or other services within tho sarnd jurisdiction.

The fragmentation of services has also tended toboth.

reduce tho ability of elected general governmentS tocontrol and coordinate services within their boundaries. Beyond statoethorized school and utility dis-

The high pnemployment cities with decreasing popuIhtionsilhibit the most acute symptOms of need. The
Joint Economic Committee points out:

tricts, there is a plettlra of special4rpos(torganiza
tions created as a result of -Fedel-aL requirements
under various programs. Many zit theg, bOdies linkspecialized administrators in local, state, and Federal
agencies but bypass elected local and state officials
who are ultimately avcountable for tho Overall resultsof these programs.

-These cities have increased total service expendituresby three percent: in real terms, this reprwsents a three
percent decrease in.their aggregate service budgets.
They have simultaneously reduced th.eir aggregate
capital buotets by 13 percent, and require 60 perrentof the total ampunt proiected for capital needs. They

State Modernization of Local Urban Govarnments
Clearly, if states are to inoderize the poundaries,
powers, and firmncing of local governments in urban
arees, Federal polici* and programs that contrayenesuch efforts will hgve to be substantially altered, In
the near-term, Federal fiscal aid to distressed com-have, in additibn, nidoced their public employment
by a5 percent_ The tax rate increases in the highunemployment/population decreases cities accounted

for 73 perrent of the total 'revenue generated fromtax rate increases. They have Ay experienced thelargest *mate reduction In their unencumbered \munities is es4Atial in order to enable Such municisurplus; a redyerion of 32 percent from fiscal year polities to turn their attention to long-term, development and attainment of ultieaate fiscal self-suf1976-77 andthe largest total deficit-4682.2 milficioncy. The arnount of Federal assistance to suchlion including N
York City."
cities has increased dramatically during the 1970s.
am,
Steps taken, by central cities to reduce fiscal strain According to estimates of the Advisory Commission--)have at timel made things worse. Higher taxes and on Intergovernmental Relations, Federal aid to alower quality encourage additional movement away sample*O1 15.targe cities accounted fctr just over anfrom the city, further eroding the-tax base.

average of five percent Of their own source of general

Fragtnentation and Loss of Accountability

revenues int 1967. By 1976, direct Federal aid accounted for an average of more than 28 percent of

own source general revenue in these same dties. By
1978, direct Federal-44 is expected to account for
Decisions about which government will provide andpay for which services in metropolitan areas have more ttian 45 percent of own s2ice general revenues
f increase have occurpeen mlide incrementally over the years producing in these 15 cities. Similar rat
s well.
'autonomously admirlistered services frequently fain- red for smalleapitilliwnit'
mented and conflicting. While some servicei are bestdelivered at a small scale, others'are inefficiabelow 'But Federal assistance not 'a-long-term solution toa certain size threshqld 'and)are best deliverlffregion- the fiscal problems of urban areas in transition. The
ally. Vailations in the.provision f services within a structure and finance of local goverpmept must be
metropolitan area often have i parteint locational modified to reflect the metropolitan realities that
implications,that can create pr blems for adjacent shaVe now emerged.

*r'Per Capita Educational'and Nome Cational Expenditures by'Region for the 37 Largest,SMSAs, 1 0,
Total Expendities .
Educational,E xpendlture
OutsideCentralGltles

I rlsideriegionCentral
CitiesNortheast
Midwest

$613

South

96
f- 576.' "West

49e,'Ratio,ofIn

gCC/OCC

Central
Cities
I
$186

$419
360
.a07

146%
138
129

460

12

'

- 182
170

ipd

Noeducational Emponditure

OutsideCentral .
CitiesRatio of1 nslde

CC/OCC

Central
Cities

26

82%

$47.7

.$193

89

166
128

179 ,

96

316
226

233

84

- 380

1

.

Average
'424
385
136
183
211
:
r
/8"Orice: Advisory-CommIsion'on I ntergovernmentlir Relations, preInencle1 Erne
,

.

-

.

A'

II

,

4

341

OutsideCentralCie.

CC/OCg

'

v

20626

203

227 -

170
167

4

198%

1

)-

Ratio of 0,

Arroor''.-,7. RestAng Urban Parks.and Recreation

132

Approeches that can be token by states to moderriize
local government in metropolitan areas in transition

are many and will ineviutly vary from state to state
and area to area. They might include suchermasuresas:modernization of county governments to assume
responsibilities hitherto discharged by municipalities;
consolidattn of city and county governments insome smaller r etropolitan areas;establishment of multipurpose regional service
corporations;conversion of metropolitan councils of, govern-ments into councils with direct plarthingit and decision-making responsibilities comparable to those of
Minnesota's Twin Cities Metropolitan Council, *use of boundary commissions to revise local government boundaries or establish "develOprnent
zones" for the provision of future major urban services, includinitutility systems.
.

r.

Only the states have the powers to authorize and irn
plement such reforms. In undertaking them, however
the states will r#,,,ji-e the elOse cooperation, partnership, and ,supp6rt of the Federal overnrnent.
With such a parttnership lies one f the best long-term
answers to the problems of urban areas in transitio

Already, several states liieknbarked 'upon the dveloprnent of comprehensive urban strategies- aimat these very objectives.

"Working toget ler we can revitalize our "Nation's
cities and insure thei proper role as the centers ofculture, business, communications, and recreation .
that they have been throughout our Nation's history."
Phyllis Lamphere, Seattle City
Councilwoman, Citizens Forum,
Seattle, June 21, 1977

In many older cites park and ocreation systems havesuffered lrorn ,protracted disinvestment, sonic haveless money for recreation now than they did five
years ago. Operation and maintenance of existing
facilities is a pressinue.-oblem for all cities studied.
Declining urban conW of older cities spend.rnore,than 95 percent of thoir recreptiorcbudciets on operations, with little to glare for repairs on renewal, reuch
less expansion. In the larger, older cities recreation,

facilities are deteriorated and out of date, and theoldest and most dense cities tend` to have the least
park and recreation land. Clime and vandalism alsb
plagve recreation programs in nearly every city.
Not surprisingly, tho worst deficiencies are in the
inner cores of the Nation's largest cities. Core-cityneighborhoods have lost more recreational facilities,
or have had access blocked by physical barriers (such.as highways) than other neighborhoods. Access tO rec-reation is a general problem for the urban poor. Over90 percent of trips to national parV, regional wirks,
arid other significant recreational areas are made inprivate vehicles, yet 40 percent of all central-city
housqolds are izhout autoNobiles, Less than 10
percent of the c les sampled in the recent National
Urhan Recreatior Study yve adequate public trait
poriation' tO n9arby regional park and recreationalardas.

a.
4

In a number\ of 'cities abandoned, underused, or delcaying Kees have the uptential to be reshaped foe
pblie fecreationr SchoOls, for example,, could be
more effectivelY used for indoor recreation.

Adequate and varied recreation'. 4portunitios forurban residents depend on effective use of the open
Er,/ spaces that now., exist in and near citiet. These remaining open spaces serve crlical environmental,
cultuol; aestheticar\d, inirnarly lases, agricultural orother econorriic purposes in addition to their potential for recreation.,

The traditionlil and sirnpldtt way to -conserve such 'resouices is for governments tb buy them, end gime
growing sutprban and exurban areas are still ticquiring park enci recreation Ibrld..But in central citiet,-"t-where fiscal strains are greatest, acquisition has virtually stoppecia In tact, throughout the country it is'increasingly -ident that skyrocketing land costs andfinite funding sources make it impossible to provide
public needs for opon space through acquisition
alone. Other legal. techniques can be used tdpreserve

A variety of techniques for purchases of less then allproperty' ownership rights have been used primarily
to protect farmland or scenic beauty in rural areas.
There "loss than fee" tedmiques also offer considerable benefit to cities, because they can protect open
space at the urban fringe. These include agriculturalOpen space while keeping properties on tho public kax

zoning, purchase of the landowner's development

rolls, thus requiring expensive ,larid purchases only

rights, ernd purchase of scenic easements.

where important rcreation, ecological or culturalvalues cannot otherwise be obtained.

Some of those devices aro especially applitable to.

cities themselves. Requirements that now developers

Open space in and arqund cities that are most amen

dedicate a certain portion of the projects,to pubI ic use can be imaginativOly combined with otherable to protection by techniques other than ac-quisition include waterfronts, or undercised or eban- land use controls to crairte new even spaces and rec.doned blocks in cities, whore recreatiOnal irncl corn- f reation opportunities. within Our older cities. Commeccial use can be combined; wooded or open areas mercial 'Waterfronts long neglected in such cities as
On the fOnges, where recreation can coexier with Boston, Milwaukee and others offer economic and enwatershed protection, \ ant scenic or agricultural
vironmental. opportunities that are attracting newvalues. Imaginative use of a number of easement purattention, So do other neglected urban araas. In
chases, lease backs and otherk but often underused,
New Jersey the regional Hackensack Meadowlands
legal preservation techniques Nn contribute greatly Commission was authorized by the state tO direct
to urban r.echiation at reasonable cost.
comprehensive development on the 20,(300 acre

New Jersey Meadowlands (just north of Newark)
Nigh property, taxes contribute to the loss of urban)ringe open space to development. Differential assess-

Which was long ,an abandoned, pollyUrd, but ,potert-tially valuable open space, residential and tOmmertiat( ment schemes reduce property taxes on undevelopedarea. The new inter:municipal commission can prepare
land by basing assessments on current (usually agri- plans,- issue bonds, acquire and condemn land and encultural) uSe rather than on market value. Various force codes and permits. The Use of easements, zondiff ential tax measures have been authorized by 44', ing, and egvironrpental regulatiOns, and the dedication
by developers Of 595 acres Of parks end 850 acres ofstates t
e p protect farmland, by 21..s ates for' forestlands and by 15 to protect open space apnvron
wetlands, is designed to .create and protect a newurban recreation resource.
ritentalareas.
Nevertheless
open
space
preservationre.
quires support by other leTI devices al well 114Liferred
tax penalties often simply postponed rather t an ruleout changes in the use of laricl, and in any event,County participation in differential assessment has
been tow in urban fringes where its use is mostneeded.

"Von.koo+VO

6

"

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1. Emerging State and Local Partnerships

86"Villiges don't wa

o be suburbs, suburbs don't

want to be cities, ciTies don't want to be wastelands.'
Governor Michael Dukakis, ofMassachusetts City and Town Centers:
A Pnagram for Growth, 1977

There are aspects of growth and development overwhich states and urban communities have somedegree of -direct influence and others that they canaffect only slightly or not at all. Obviously. Federal
policy plays an important role in the development of
every commdbity, state and region, But powers andresponsibilities are divided within our Federal system.
Only through a partnership that recognizes the separath Nobilities of each level of government and therelationship betweee. private decisions and public
action can th9 Nation, the states, or communities im-

be used as a powerful incentive or disincentive toachieve a state's growth a d development objectives.
over the use of land
The state has jurisdict
within its bounder ies. it ma delegate to or remove(although politically dif I icult) from local jurisdictions
any powers over land use deemed appropr into by thepeople and legislature of the state.
The state has the power to regulate anctestAlisq
standards over a wide array of activities4ricluding the .
use of the_ environment.

The state can affect urban patterns by investment

or lack of investment in infrastructure and by theway it apportions its funds for infrastructure and
SCIVICOS among dif ferent areas of the state.

Tha state is an administration and investor,
Through its own direct planning and capital invest.
moot action's' in health, education, traritrbrtation,
welfare, housing, public worlq, and a host of otherplement 'erban polities that will effectively attain fields it may take an &live hand in ihe shapini ofend development patterns within its boundtheir objectives.
A state can inflUence its 6verall prosperity to only a.
limited degree. The states are open economie in enational system. Any fiscal actions they might takeare not self-contained. Nor is the ebb and flow ofinvestment capital profoundly amenable to state influence in the short run. Fiscal and monetary policies
that affect the rate of overall economic growth in thenation can only be applied at the national level.

The state can he a landowner and through direct.acquisition, or through more indirect devices, forestall develOpment In certain fragile, scenic, historic, orotherwise publicly important areas.
The state is an adjudicator and through its courts,

regulatory ..commissions, review boards and ether
bodies can mediate and shape the patterns of it
growth and development.

The state can affect the form -and character ometropolitan
governance and development througijj
However, the Federal government laks re4uisite'
it can facilitate annexation blegislation:
powers to significantly affect the location and distri- state
municipalitiesof
peripheral
areas as in the South, drbution of population and economic activity within astate or community. These decisions are subject to it can make it difficult or almost impossible as in thestate and local land use policies, the location of state Northeast and North Central, by acts of omission or
and local pu lic investments, local goveinment func- commissLon state legislation can affect the powers ofiand the quality of metro.
tions and s uctures authorized by the state legisla- metropoliIan governancepolitancobperation.
ture, And sta and local taxes. :ftt'Until recenity, the powers of the states tb cohscioesly
sliape their- patterns 'of urban development were used
only passively. State emphasis was upon development
outside the urban areas,

A groWing number of states are now bringing some or

Begjnning in the 1960s, however, a growing number.
of states have initiated attempts to intervene in their,patterns of urban development by using the full rpligeof powers available to them in order to mete envieonmental, social, and economic objectives. AI

based 'citizen ef forts. to .assess the directions of futureo;wsuch pu

States' powers to aecomplispsiderable:

ses are con-combinations of thege powers into play in attempts
to discourage urban develoVnent in some areas, encourage it in others. Over ,35 states and several dozen

cities or iryAroptolitanTeas have undertaken broadly
growth and _development and to proposeand implementstate and local interventions in urban development in 'order to meet environmental, social, or
econorra objectives. These interventions range acrossthe full spectrum of state powers: controls over theuses of land, new regulatory and re,view procedures
concerning major,development projects, alterations in

Lecal.goyernment is (creature of the state. A -the structure and finance of local goyernmena andstate may strengthen or modify local powers to deal 'the consyuction of-Major state facilities, State-interventions -have evolved since -1960 from environmental.
with' the problems of Towth and development.
The state establishes its own taxing powers and concerns over the impacts of land use to newly
those of its constituent idrisdictiOns. Tax policy can emerging state commitments to the develo'pment of.

.1

comprehensive urban policies. Forty-two states pro-

Hawaii was quickly followed by efforts in a number

vide preferential tax relief for agricutural land andopen space,. 34 states aro involved In coastal zone
management. 13 have special legislation protectionof other states.

critical environmental areas, and five requfte per mils
for developments having regional impacts.

gional cothmissions to control almost all developinvit
in that State. It reacted to an upsurge of urban devel-

/

..me

Vermont undertook an effort through state and re-opment in the southern part of the State, whichappeared to threaten both the environmental values
and "quality of life" goalt cherished by rrtarw, resi-

Sze Litnd the Legislation.1ericans have long asscitsi<ed progress with growth, Cldents.
Nationally ur riTnifest destiny yves to develop thecontinent: ocally, conventional wisdom traditionally Florida, with one of the Nation's highest rates of
population immigration, reacteii to threatened wholesuggested igger was better and more was essential,
sale environmental degradations of coastal areas, wetThis historical perception of gl-owth came intoques-- lands, and other fragile natural systems by reversing-

tion during the late 1960s and early 1970s. Fred

its historical enthusiasm for growth and adopting

Bosselman and David Collies in The Quiet Revolution

broad-ranging new controls over certain kinds ofin Land Use Control called attentic?to an importantdevelopment in certain areas of land, in part to protect future water supplies and public health.

upsurge in state concerns with land use objectives andthe quality of life in the late 1960s anitearly 1970s.
They cited inikjatives by more.than a dozen state governments to reclaim land use control powers historically derogated , almost completely to local*.goiirern-

Oregon undertook major new land use legislation.

-ments.

Similarly the Rockefeller Task Force report, "TheMaine1 Massechusetts, Minnesota and North Carolinato name onhOnajor exampleshave taken.jAnd
use, initiatiVes of 41'ne kind or another in the lost few

Use of Land," examined the fears, apprehensions, andyear5.

even the outright hostilities found in many sectionsof the country toward growth.

There does appear to be an important neW altitude-toward land use and its contrOl evolving,in the
United States. The intensity ofthe new attittide rnay
be uneven, and certainly it varies within and amongstates and regions. At the same time, since 1970 hardly

a portion of the Nation has escaped entirely the itn,pact of these new attitudes toward land use control;
1.

Over 15 states have acted more or less comprehensively in adopting new land ifse legislation. AlmOst allstates have taken some steps to address locally perceived problems of land use and growth management

thvt directly affect urban development within thestale.

The emergence of khe states as major interVenors inland-use 'managemen can be traced to actions of theState of Hawaii in 1961. Faced with the rapid los ofagricultural land and the uncontrolled growth 'of
4
urban areas, Hawaii developed a land-use scheme forall land in the State. Land was placed ibto a number
Of classifications including urban, conserVati6n. pres4he
ervatic.i 'and agricultural. lniplementation'needed rules and regulations was leA either direttly In
fhe hands of the state, or' in the case 01 Orbtin

in the hands of counties. The initiative taken by

Similar concerns in Colorado produced less sweeping,but still important actions. Other states such aS

Much of this re-assumption from local governments.,by states of some land use management powers Has',resulted frorn concern over the "more$1101-46cal" impact of many local governments' land use decisions.
Such matters as the over.lercling of waste-treatment
plants in many states have Produced state and Federal
construction moratoVi o. in certain areas until wastewater treatment facilities could be upgraded.

Some local governments, by n9 means a majority, bu*
numerous enough to be significant, have respondedwith new efforts to control, limit,'manage and other-wise have a leater influence over-their growth. The
definition of the term "environmental quality" hasbeen broadened, to include more than the protectioh
cif natural systems, The "quality qf life" considerakions that have at times been confined tO physicalenvironmental 1 lrotf5 are increasingly discussed in!terms of restoring or preserving a more attractive living environment for all .urbari areas, not just on thedeveloping fringe, but in center-city neighborhoods
wheie revitalization, rehabilitaiion, and urban conservation efforts are accelerating,
While land use issues have- remained persistently _WO

on the domestic public agendipver the past 12 years,
the focus of attention has' shifted with the changing'emPhasis of public concerns.
,

.

91

1

OP

While many earlier Federal, state, and local initiatives

wore born out of environmental considerations, astronger focus in the last several years has been on
issues of social equity. And there has been a disceintie-shift toward-greater preoccupaliun with land use
controls as they Mfect the development and structureof rnetropotitan regions and urban neighborhoods ihcomparison kto earlier emphasis upon the preservationof unique ecOlogical areas,

State Urban Policies: A Second Quiet Revolution

School BUIlding Assistance The State's prodram ofschOol building assistance has been substantially redirected to . facilitate the rehabilitation of existingbuildings taird to oncouragb the inaown location ofschool leek t les'. -Open Space and Recreation Investments Priorities
for the .allocatagi of recreation grants, have beenrevised to give greater support to projects which can
trigger private investments in urban areas.)

Public Housing A'rocent bond issue tor tIderly houswing will give priority to protects in taban locations
aril] adaptive re-use of ex isting buildings.

These changing stale and local attitudes herald asecond "quiet revolution" in the approach of state.

Trarisportation Investments In the allocation of Stateand Federal transportation investments, increased empha'sis has been placed on expediting those projects
which serve already developed areas. Special attention
has been given Ito mass transit projects. In addition,
the use of tranirtortotion funds to upwrade and beau-

toward dovelOpment. Minnesota. has the forefront inpractical apphcation,of the full range of statepowers
to guide or cbntrol urban development and redevelopment the. MetropOlitan Council of MinneapolisSt. Paul, created by the Minnesota legislature in 1967 tify :ity centers with trees, lighting, brick sidewalks,
destrian amenities has received
and refined.since then, is stiihwithout rival as an ex- p5rking garages, ant,astrongcommkiarnple ot state leadership with respect to governing
metrOpOfitanwid.g regions. :However,- a trend is now Sewerage Facili s Project eligibility criteria haveunderWay in a number of states to define their o wa___Deen broadened to include collection systems andcomprehen.PAIrban policies that draw upon the fyll combined sewer separation projects. The State has
range ,of state po rs for implementaiion.Moreovei, also taken stenli to expedite urhan*waSteMV,rw-projects and to discourage costly siructural systems on
severel states have ret endy adopted or are implement
ban areas and piajor interceptor sewthe fringes ofing urban str ategies.

ers that run thr igh unievel ated land. The State,(

Massachtrsatts Urban Policy Massachusetts has beeit
One of the first states to formulate, through a broadaly-based citizen .ef fort, a state urban policy set 'forth

in a State document entitled City! .9cown Centers:sought and received Federal atioproval for commu-r
nities to 'rise Coinmunity DevelopmeD3lock Gi'ants
for local matching of Federal Water quality conftol .
grants,A Program for Growth_State affices and Facilities All state agencies con, ternplating an expansion or a relocation to fill sPaceThi basic elentents of theikOssachusetts policy' haVebeeli outlived by Governor Dulcak is:
A special Development Cabinet has been established in the state governmenl consisting' of the Lieuoretaries of Economic Affairs,
tenant Governor; tEnvironmental Affai s, Transportation, ommunities
and Development, nd Consumer Affairs; and ,theState Building Cocle Since most of the consyuction
activity in tbe State's major cities. now involves rehabilitation,and adaptiveke-usq of existing buildings,
tr major revision to the Stateis uniform building code
has been prepared which will facilitate the review andapproval of building perntits for existing buildings.

needs must do so' in existing buildings in city centers.

Director of Skte Planning. The purpose of this re-.

organization was to achieve greater coherence in %ate Michigan Urban Policy MiSigan's Governor William',Milliken formed en Urban ActiOn Group to formulate
decisions orwrban development.
Two strategy ,dOcuments were, prepared to pro- an urban policy for 'that statik Tbe report, .entitledvide overall guidabce for all State development deCisionS: rower* a 'growth Policy and All Economic
Develbpment Program, for Massachusetts. Both con.'tain specific recomniegdations about hOw to:combine,The full resourpes of gtate .g ernment tO provide
better -serviCes to cities and to improve economic
development.,:

Cities in Transition, sets fortr a ries of 85'1'0CW:emendations for Statt action to acbieve,a numetar ofpolicy objectives which include:
Expand Economic Opportynities in Urban Areas.
Recognizing the changing econornic.roleof4:ities, theState will aid urban areas in attracting new,enterprisefor which urban l§cations will be Most suitable in the

4.hirdly' a specific S6t of actions were undertaken fütunrand Combi e this with affirmative/pining proMitt the new jqtls wi4h these whoto redfreet more investrnent back toward urbari areas 4grams tailored
live
in
ttie
already developed:C.

.

Rimer -a -Sense-cif Co,mmunity in Urban Neighbor.
hoods, Recognizing :that neighborhoods are the basicsOcial fobric of urban communities the State, in co-

California shall encourage-the conserkatio;i andrehabilitation of neighbor hoods in existinglities an()Dilation with narnicipal officials, will attempt toGovernment agencies responorble bor thepradeVeloption and construction of puttlicfacilitres

stfengthen local comrnunity.organizations, inibrove
resonsiveness- of lOtal goVernMent progreens toneighborhood needs, and promote neighborhood conservation and rehabilitation.
Expand Urban HousiQg Choices. The State willemphasize rehabilitation and maintehance of 'existing
housing stock and ensure the availability of financing

for home improvement and construction in urbanneighborhoods. .k
Assure the ,Sec'uri ty of Urban Residents and Their:

Properly. The State will promote,.neighborhood ef_
forks to reduce crim13 and to more effectivety usp
poke at 'the neighborhood level.
.
Strengthen Urtjan Governments, The strategy
alls for improved coaperation among local govern-lents in'\, metropolimin aka, more equitable distribution ot,.nietropotitan tax burdens between cities
and suburb's, irn

d delivery of public services, and"coordination ote and local policies. As in the.pae of Massachusetts, a Developmen't CabineEis proposed.

i

.

..

Use Existing Ilesources Mow Efficiently. The
State will redirect its actions to avoid subsidizing andencouraging highsost, low-density development
which consumeS Carce NOMut:al and recreationallands.

i

All of these urban policy initiativeS are in addition t
exi. ng State efforIs to assist communitjes such a
unr Aricted reyenue sharing, a 'property tax cirCuit
breaker, process, clirea 'fiscal re-lief, a proposed tax,

base sharing scheme.fpr Southeastern Michigan
payments for municipal services tp SOte 4)cili)1
a St5te funded urban.graQt program.

doutlying areas. Unlike those two -stet California 's

still the recipient of substantial inrciAtion. Environ
mental 'conces are.strong :there. But:the State con-tains a rxixj of cities sufferipg from problems of
abqndonl-ne/spd population losses:while othes expkssures of rapid groktb,,... I ts recently
adopted and funded cdreprehen'sive urban strategy,
Urban Developmont Stretegy -for California, preparedby-a speciat.interage0;i_.task force of Suite officials
perienCe th.

i and an qviso

coMrnittee of privote citizens andobjectives similoTM6 in Masse:'local offrffl-,,-. chusettsaria Michigan are propr ; amoir them:

7

..:

-

i

g

suburbs.

SChedules'Ini fielding 'the miiiriterlante, rehabilitatiOn;or replacement of these facilities,uState capital outlay programs shall pncourage
urban development within and contiguous to existing
urban awes.

Local planning shall direct nevrirbari development to areas within and contiguous to existing urban
areas and shall promote the conservation and rehabili.
lotion of existing urban development.
.City-county decisions shall guide new develop.,
ment to areas within and contiguous to existing urban-:yes.
California shall. develop a mechAism to accommodate needed urban development while protecting
air and water quality.

Stall actiOn and linancial assistance shall en'courage the lootition of necessary pnd appropriate industrial ind commercial develdpment within -and. contiguOus to existing urban areas.
To -the extent possible, all appropriate 'Federal
programs hall be directcW toward auppor'ting andstrengthenin ex isting urban areas.

_

1 he MassaJuetts, Michigan,. and *California approkIls 41e repretentative of.comprehensiye urban
Policies under consideration in a .namber Of otherstates 'as well,,,such as NeW Jersey, Pennsylvania al-id
Connect icut.

State Responses to City Problems

tate

California Urban PollcY Both Massachusetts,...aMichigan are' states having older industriaKcities,
where existing urban 'investment is bei g underutitIod while new development has been muffing in

,

89

,

Ohile a majority of states have yet to undertake a
new and 63mprehensive concern over urban development,:.e, large number have adopted policies incrementapy that are inlended to help ctistressed central
cities. 'This trend represents a significant departUre
from past state -policies when, as dna reporf prep redfor the Councrof State' P nning Agencies pu s it,
most state oblides were desi ed to "hel _the hinteruch decisions as .p
land." Those,past policies inc
locating state/universities ,andajor state facilities'.
awe\ from -die main centers.df populatjOn, school aid
formu s that favorecknon-urban areas; concentr tingon intrastate and farm-ibmarket trarlspbrtatioin-vestmênts; and sta

finRiicin g of servides inrareas that are funde lo Ily in cities tltrid suburbs.
e

Now states are hifti
this emphesis through mocti-'fications to Pi 'wide- ranbe of state policies antk-programs in. ecromic develot, transportation,
'

9

oisto

"-

and 'gen Jose to phase the developrn.it of utilities
end services on the tuba!) periphery in acc:ordanee
with Lawfully drawn plans and schedules wepeendtand by C.a400111 .1) letiNation that einpoweis coonties and cities to j in together in managing the paceand dilection of urban gi owth:water supply and pollution control, state facility loca-

90

tion decisions, investment of ttate funds, housing.
andneighborhoodpreservation.

state

regulattlry

educational finance. and changes In the ft
mincc service responsibilities. and stimuli e of Int al.

governments in urban al Om.

J

If nptional urban policy is to encourage,more offeelive '.use ot.elilAing urban investment, such a shift inemphasis by Vete governments is essential, for with-'Since the late 1950s, many cities had been actively
engaged in urban renewal efforts. particularly in theirout active state partnership such a Federal policy can-emphasis has shitied toward more c.ornpreher6ve
econnoth. and community. renewal. Louisville hascreated a Community Development Cabinevricem--

central business dish icts. But during thrs decade, Oki?

not succeed.

the Council of State 'Planning
iljencies, Stato &Noon= to Centro/ City Problems,rAmarks: ,"The Federaf government is powerless toaffect the revenues of cdntral city governments ex-

passing eill community development. economic development, housing, and manpower programs. IlartfOrd. _has attempted similar coordination.

As .Lhe report of.

onomic development was not
Until this decade,gives the money to the slates to redistribute. The eonsidered a major ity government msponsitly inecler al government cannot open and close tax .most cities, 1 hat fu whorl was left to ChambUrs ofsources to cities nor, under current laws, have any Cornmel ce, down t wn assuctations, and SitUidr
ivate associaticms kind clua4i14160c
significant impact on how much money states provide orpnilations.

'cent insofar as it gives money directly to the cities or

ego

to governments serving central-city populations, The corporations were frequently used in. the ptitt_tO- tacitFederal govrnment has little impact on the organi7a- itate community renewal and.economicileyelbpnient:xioationtion of funCtions at state and local levels nor on the the Old .Philacielphia tbeveloprpent
croanon of taxing.jurisdictions that encompass entire Kansas City Central Indilstrial Distriet KssOc5iation,
metropolitan areas. 1 he Federal governmenti cannot the Grerer Buffalo Development -Foundation, formitkage its own programs. If a combinationTif hous- example. The Philacielpla Industrial Develb .menV-9
ing, transportation, manpower training, adult educe- :Corporation and the Regional induslr
tbn, and community block grant programs is going to Corporation in weserri Pennsylvania wure mo,of thebe put together to help a metropolitan area with a piobeering Industrial davaopment authorities.
specific plan. rt will be the state 6r an instrumentality
In the pastdecede, hov.4Over, cities hal/4.RO Cloly V-,..of the state that mustsdo the packaging."
panded the rAse of such instruments, .:byi organima
To a large extept, states could not avoid being im- major ecpnomic and community dOKei.Oprn.ent agenmersed in the problems of their cities, but the rate of cies in citY' hall itself. States are granting.puthority toescalation, n that involvement is rapid. Irrthe coun- municipalities fon a growing ntiriper finbncing andties con ming the 11 major cities that loSt more than land aspernyage tools in connection .with these ef-10 percent of their population between 1970 and forts: tax abaternen6, tax inCrembni financing, and '1976,' local gbvernments increase,d their tax ..collec- direct short-term loans for.balnesi, to naint,:bUt ations by 52 percent. 'State aid, however', more thorn few of the more usual. Industrial revenue bonds, corntrij3led. rising from an average in 1970 of $47 per ; bined ith urban renewal and erninent domain.powers, h e provjded eities with the opportunity tocities to $13.
capita in0establish land bankS,. industrial parks.:and broadscppe.commercial arid residential- rildeveloRent
Local Actions
ects..Ohio and Missouri have enacted leglsatiovnabling ifiuni?iRalities to use 20-yeat tax abatements,hthp
broadeningofstate
assistanCe
tb
Paral.jel
flexible eminent domain' authorily, and government
opolhanpreaslire
greatly
expaniledetcities and m
guarantees
as iirentives'lor in-town redevelopment.
forts in d'rban commtunities themselves to develop
broader-basea approaches to economic and Commu.
In a growing number of-Cities this economic and coonity developrnr t'
_

,

1

.

,

..,

rnunify development planning is cornbine0with efre directly related4 lorts to bring local labor force skills into line withto stale acNns. Esttiblishment o the M'etropolitan new e*loyrnent prospects and to rbduce hard .core
4N,.

In solve instanceb, the e initiati;ca7N\

utTem0Toyment. San Diego uses a pottiOn,"5 Fedoral CETA fund o contract With private industry to
train employee for newly-relocating, industries,

Council in the Minneapolis-St. Paul m tropolitOn area,for example, 'resulted from a direct Jnitiativorof thestate legislature. Ef forts in metropolitan Sa Die q
0

.

1
.(/

4

4.

2. An Emerging Public/Private Sectór
Partnerships

Albuquerque provides on-the-job Vain ineunds to newindustries locating in the city es well es to existing
firms planning to expand. Fort Worth, Long Beach,and Hartford have tried to' use Federal training funds
as an off irmati-ve Qart of their effor ts to create moremainstream, perm)lhent lobs tor the) unemployedthrough coopt;tion With private employers.
Many Cities are focusing substantial, new attention on".neighborhoods and are bringing-neiljhborhood 'organ

Coy G. Ekund
President and Chief Executive Officer
Equitable Life Insurance oc.iety of U.S.
New York Corporate orum, October 1977

izations into the planning of -corrimuni0 and eco-

No mailer how well-conceived public el forts might bc1

nomic. development projects.. i3uffalo. Cleveland, andmaintain our communities as 'good
to restore
places* in which to live aid find work, the ultimate

Dayton has integrated rieighbothOod participation
into overall city development planning. Minneapolis,
New Orleans, Kansas City, and Milwaukee have neigh-borhood development programs which directly involve neighborhood organizations. Columbus,- Ohioor'

"It is now time for gcaornment and the private sector
to make an equally clear commitment to address thesocial and.economic challenge of unemployment inour cities together."

And a ignificarilnurnbeif othot cities,ve author-

4+

out66mes depend on private decisions and private in,vest rnent
41
Decades ago, cities provided unique business advantages over decentralized sites. Face to face contact;ized neighborhood corrirMssions that can establish
and enforce standards for neighborhood ren.k,v1 andskilled labor pools, efficient trinsportation systems.

rehabilitation. Many cpminunit les ate now engaged in
major housing and commercial rehabilitation projects
recNicliN olckbuitdings into new uses: These neighborhebds-span all income levels,

facilities created an environment coliducive to highproductivity. These economic advantages were further enhanced by .cooperative relationships between

In nearly 'ail cities, itowever, comprehensive efforts
frneighborhoods ui have engendered a new need'for glose cooperat ion etween public agencies andprivate busMess, labor, and civic interests.
\Som.

housing opportunities and Zucation and cultural'City political leaders arid the leaders of the local busi-

ness conmiunity. Some would call it collusion but
few would dispute the economic opportunities thatwere generated by an ongoing process of public-pri
vete sector interaction.

'..loday, grave obstacles have been erected to thwart
both the economic advantages that cities once en
1-joyed and the fruitful 'opportunitiestharaccrued topast public-private sr dialogue and coopertition.

On theconoinic

maintenance and operating

costs hi e risen. Local property and income taxes
tbed. The skills of the labor force have fallen
Transportation services have degenerated,the commercial and residential infrastructure has
sharply.

deter iorated.

On the olitical side, recent efforts htlye been-madeto bro den the participation of all citizens and interests i1 guiding 'city affairs. Although, few can arT..ie

with the goal of increasing citizen participation incity ...government, the process of restoring moredemocracy ;to our civic affairs has frequently resulted
in confrontations between groups drid has sometimes
produced inaction and stalemates in decisionmaking.
At their Worst, such antagonisms have prompted decisions by oitie firms to move out of some cities andmetropolitan 'areas in search of less contentious environments.
p.

More seriously, as noted at a cOnference on relations
between. the public and private sectors-i4 the North-east sponsored by the Department of Rousing and1

Urban Development. government and business simply-don't talk to each otiiei. Since the under 'yin cause
seems to he that Molter considers the oth worth
talk log to, an atmospileie of mistrust Ivey:Ids." I wo
recent surveys of the Nor thea:t and Midwest r onduct
ed for ths T conomit- Development Administration in
the Department of Commerce identified antagonism
betweart business7M56171-isidELoups. and government
in many mature urban at'eas_as a prune) y impedimentto economic revitalization.

92

Increasingly, private .and publiwof fit s of tbis kindare being wined mit only at the mum( tool. Au at themetropolitan. state and regional levels.

Technical Assistance Ono of the most le,ent and use.
ful Forms of cooperation hetween the two set-tois has
been the6rovision.of expert assistance t9 pity gcwernmeats by financial' -instifulions for the Jpurpose Of
improving municipal' I inancial ninonagen ror 1. The mostpublicized exclinpkis of such assistance have tmen in
Nmly Ypr1/4 Cit\. 'where corpeAte of firers -ol several .)In their day-to.day affairs, these groups must occe linancial institutions hilve heen assigned tir.x.woi k withsionally be adversaries in collective blygaining, gov- the City- in developing now I moncial management sysernment nagulation, a higher level theY sharl:,a corn-. .terlis and. practke. Simital assistance has been nromon dependency upOn !..onomit:- expansiOn: The -s;itt6d in 'Allegheny County in weStem Pennsylverho
sunley found that in the reFentspast these larger inter-- by liorcing institOtions in Pittsburgh.
ests had-been lost sigfit,oloin mtlny.ptrts of .theAlorihe,,,

Economic Development A wide range of Oartner.

-- est and bec'arnre kigiclitittd .in .0 Set of reglOO.al intag.
onisms.- destructive tO'the long-run inwests of all; ships, _through private or quaSiUbliC. eorpor/ations,
ElusiAss had come to feel that State and local government are ineffectiye, fragmented, hostiWand:uninter-

ested in the..try . Po)pctxnel. programs needed tounder.Writ6;eCriminik
i.ene I. Busirtess And labor dis71,.
e.: .. trust.-each other and a large and vocal segment of the.

.:-pUblip distrusts b90 ,0.well as goverment, There Is asense thatIdects/o have frecome too difficult, coinplexitiP*f.re,d.fape too frustrating, and.hostility)::toodisiroaraging to tho. ho invest in and manage economic enterprise:has been for-reed to address thweconor wt. I Irotilems ofcities. Ono ol the oldest, the P.Inladelphia Industi ial
Development CorpOration, wre fOrmed at the initi
alive of the Philadelphia Chaaer of Commerce. It isgoverned by a 30 rriember board that inclucte seven.;city representatives, eight local business leaders,- and,citi7ens chosen jointly by the city and' the Chant

.

her.

1 he Hartford Lcononlic. Devel9pment Corporation
was cr oated

ft-SerieS Of forums If t 1-00 sponsored to, solicit"- :' -:"4ho views of corporate leaders ir1`-tbe urban process,"i',

this .same sentiment waS expressed. N.ITorate leaders.argued Wet public officials are acting i'rrevon.sibly if

1976 as a bridge betweenthe Chamberof Commerce and the city government. Through the
Corporation,.tho city andbusiness community work0
together to,-belp retain existing industry.

"tliey do not try to attract the maximum`Nount of 'In Minneapolis the linkage is les for mal. Leadingilk

private investment do rS, jobs anddocal t'ax.. rovethat lQadership by local
nues.They are convinpublic of ficials is pecessery if economic development
strategies are to be stitcessful,i

The Diverse Forms of Public/Private Partnership,oSignificant new 'and di*rse'cooperative -el forts arebosiness firms' have committed five percent of their,
prof its before taxes Or public pur poses in the corn-,munity. Private companies and the Downtown Coun-cil, a private organization of business leadersencourage..wd help, coordinate central city impwvemeet, in ding finaneincr arcpitectural planning of. :?
many public and private projects. 'T-hose aciivies bre
coordinate& with 'arid approved by the Minneapolis

now underwa'y in eagh sect:ion of the United Slates tot, 'Indust! iaf.Development COminission, the pubik: agon-.
briOge these gaps of distrarst and t,o deVelop partner- cy responsible for overall city planning and financing

ships between the' public end Privarb sectors irraddressing OOMplex.*ecOnontid,' community, ,and social

prbblerns.*CodteOtio0 between government, 'business: labor, and eivic organizations can and has taken;
many forms,.

-

ahd construction of phvately and pul3licly subsidiredfacilities.' The nine-member Comniission Is comprised'of seven 'business rapresiVatives and 'two public officials appointed by-City Council.

The Chicago. Central Area Committee, in cooperation

Community, promotion For, many decadesr the prilate Action has led in commUnity proalotion for eco-with. the City Planning Department, ,finahcod the$350,00 Chicago.21 Plan. Chicago Uniied is a,con-ynomic .development Purposes, Government has' come'only reeentIy, to such activities'at the rnbrilcipal level.

satiurfr.of business Itteders concerned with.thesocial
and wionornIt-protteThS'Nininorityt eighborhoods.
n

A

.

0e

Community Development The varieties of cooperotion in community development are as great as thoseoeconoreic development. The quasl-public Dayton
City.wido Development Corporation is governed by a
28-member Board of Trustees appointed by the City
Commission from the city's public and private sectors
and neighborhood organizations. Its function is toissemble land for community renewal-projects and to

Cooperation Between Labor, Management and Government Labor, management, and governments aro
beginning to cooperate at the community, state, andregionel level to promote job expansion and training
for tho unemployed and disnlaced. Howevel this tooperation extends well beyond these areas of concern

stimulate high risk new construction and rehabil-

Many private labor-management committees aro
underway already in plants, communities, and -Several
states. There are 30 in Now York State alone.

itation.

The Milwaukee Redevelopment Corporation, on
the other hand, is a private profit-making organizetion created to stimulate private investment in the
Milwaukee busines.S. district. Public aspects ,of redevelopment projects are carried out by the Milwaukee
Department of City Development and the. Department of Public Works. Coordination is achieved
through the Mayor's Task Force which include representatives from the Redevelopment Corporation, theCommissioners of City Development and Public
Works, the Mayor, the President ot Ctty Council, andthe downtown Aldermen.

Job Training and Employment Public and private cooperatiOn hie training and placing unemployed youthand displaced workers is a growing phenomenon. The-most af firmative use of public vocational and training
systems to custom train4employees for new and ex

in some instances.

Lobot management committees are.- not new to theUnited States. There were joint committees during
the 1920s, but practically all disappeared during thedepression of the 1930s. Then under the spur qf the

War Production Board during World War II about
5,00CrcomMittees were formed., Most of these withered aNay by the late 1940s. They are coming back.

A national survey in 1978 reported 113 plant committees in 89 companies including, among otheis,
A & P. BendiK, Chrysler, Generpl Motors, Ford, Georgia Pacific, Harman Industries, Kaiser Steel, Parker
Pen, U,S. Steel, and Zenith. International unions in-clude the Machinists, United Auto Workers, Steelworkers, American Federation of tate, County, andMunicipal Employees, Teamster's, Meat Cutters, andPaperworkers.

pending firms in a labor market area has been in

The unique dimension in recent experience has been
the accelerating participation of local and state governments in labor-management cooperative efforts toSouth Carolina and Alabama have been particular exaddress community economic development or laboramples of an integrated approach to economic develmanagement issues. There are 49 Federal, state, andopment and manpower training. The schools work
closely with employers on custom training worker3.' local agencies currently involved in such efforts.
for new plants or expansions. More and mor6 states
Perhaps the best known community effort in the Naand communities are now developing efforts of thistion is in Jamestown, New York,kind in Cooperapon with the private sector. Hartford
and San Diego have both recently embarked, on such'
The Jamestown initiative began in 1971prior to' theefforts at the metropolitan level. .
recessionwhen this upstate New York city of
The Committee for _c_onomic Development, one of 40,000 was in deep economic trouble. For eighteen
years the absolute number of manufacturing jobs had
the Nation's leading business research organizations,has 1-edommended that future efforts to train the been declining and one of its largest companies,had
harVo-employ build ron successful past experi- become insolvent, leaving vacant a new million-,southern mates arid cities.

ences.

square-fooLfacility. In addition, the town had

reputation for having a bad labor climate. A community-wide labor-management committee was formed
The Committee calls for cooperative community efthat today has reversed economic conditions in that
forts involving businesses, nonprofit organizations,community. Labor working with management has imunions, schools, and governments to increase training
and job opportunities for the hard-to-employ. Newly proved manufacturing operations in several plants,
enacted rederal,youth employment programs provide " helped conceive some new product lines for manufunds and flexibility tp experiment with more effec- facture, upgraded productivrty, and carried forward
development program.
tir approaches to such cooperative training and an1ndustrial,
placement.

9';#

94

limited in the degree to which they can invest in business as opposed to housing. There is no urban development Ilank or other mechanism that ensures that-long ter tY" credit to urban business is avoilabIe. andDepartment of Housing and Alrblin Development and there is as yet no substantial soi ondary mar Let for
the Federal HornezLoan Bank Board have bean re- private tender loans to urban businessmen.
ferred to provious in this report as promising neW
mechanisms for cooperation in neighborhood renewal Enhancing mployment opportunities and labor
between residents, city government, financial insti- force productivityUnemployment is generally muchhigher in cities than in their suburbs. This is largely
tutions, and the Federal agencies involved.
because many core city residents are poor and un
Savings and Loon Associations have created "risk trained and do not haVe the skills required by potenpools" to provide conventional . mortgage loaris in tial employers. It i /also because the positions that are
inner city neighborhoods in Washington, St. Louis, open to them fre uently offer Tow pay and limited
Philadelphia, anq a significant number of other cities. career potential. T ese factors contribute both to the
It is estimated that private investment in restoration continued high Ancidpnce of unemployment amongof housing in inner city neighborhoods was about $11 urban residents and 5 lack of productivity in mariy
sectors of the urban work force, Other importan't facbillion for 1977.
tors include the tact that an increasing proportion of
The diversity of these new cooperative arrangements core city residents are young and black or members..reflects*the variety of conditions that exist among of minority groups. Private employers are often reluccities and urban areas across the Nation. This co- tant to risk hiring and training potential e'mployees
operation is also extending beyond metropolitan and without previous experience.
State boundaries to include whole regions in wkiich
cOmmon problem§ exist. Public and private coopbra- Federal commitment to the viability of urban aisastion at the community levelis thus increasingly paral- The Federal Government has participated int andleled by similar arrangements at the multitte level. in some cases been a leader in moving its facilities
out of deteriorated city cores into newer sections andDirect Federal action to spur private investment in to the subur bs. The loss of theseAlcilities, the goods
and -services needed to supply them,pnd the employdties.
4nent opportunities.,they generate has had a Marked
Generally speaking, the kinds of direct Federal action effect on the economies of these cities and on theirneeded to create a public/private ,pirit for develop- private sector. By its own actions, the governmenk
ment, investment and emptrrient opportunities can can stimulate and reinforce private commitment toinner cities.
be separated into four groups. These are-Housing LPrivate and public cooperation in the rehabilitatia-V older housing and .neighborhoods isaccelerating ?upidly and is taking many forms, The
Neighborhood Housing Servicespogram of the U.S.

Redeveloping urban infrastructureAn urban area's
infrastructure is one of its greatest resources, but
if it is obsolescent, it also can be an impediment to
new development and to reinvestment. Among the
primary reasons for Obsolescence are age and physicaldeterioration, the changing nature and requirementsof urban life, and the development of new 'technologies. Obsolescence also results wtiere a municipal
government seeks to economize on expenditures.
Failure to keep up a city's infrastructure is often a

A Modest Beginning

The examples cited above mark a modest beginning.

They are an effort to initiate a prosess of public/
private Sector interaction. It is symbolic of a recognition on the part of government that the private sector
plays the primary role in affecting urban conditions
and patterns and, therefore, should be made a partnerin the urban process.

politically less sehsitiye action than Cuts in the municipal work force.

In the coming. age of scarce resources .coupled with.
Increasing den-rand for consumption, haphazard planning cannot be afforded. Unless this country chooses

Improvements in, the availability of long-term credit

to build a rational system of public/private sector

for urban businessPrivate lending institutions areoften unwilling to rriake long-term credit available
to urban commercial ventures. Institutional factors
sometimes make it impossible for lending institutions
to Provide such credit, Commercial banks are constrained I?y regulatory institutions to limit long-termloans in their portfolios. Savings institutions often arecommunication, governmental and private investment
decisions will continue to be made withOut the ability,

to anticipate the consequences of those decisions.Certainly, there resides within the business community'untapped expertise and compelling economrc -incentives for their participation to become a very positive contribution to the national interest.

9R3, Emerging Regional Partnerships'"Each panel recognized that our system does notmeet adequately the development challenges thatspread regionMly across state Hnes. Each was impressed by the beginning made by tilt; present arrayof regional commissions and those that explored theprOlgtn urged a re-exornination with 0 view towardrealizing their full potential in assisting public andProduction areas, manufacturing areas, lines o( trans-

portnton, corn, cotton, citrus, coal, watersheds, dm-

berAftino respectors of politicel boundaries, yetmany ovate problems that requin9 public attention.
Some of these arwas,i such as the Northeast, theNorthwest, the $outhefft, are marked ty so many
fundamental natural, p pulation, and cultural factors,

private programs for full Ocononlic development."

that they clam a regi al consciousness in the minds*of their inhabitants. Th fact that state boundaries

Dr. JarTIO$ A. Norton, Chancellorof Ohio Board of Regents
Summarizing some deliberations
at the White Hothe Conferenceon Balanced National Growthand Economic Development,
February 2, 1978

an9 firmly embedded In the Constitution has led to asearch for means of setting these regional or subnational interests into the framework of the American

Urban communities throughout the United States
exist 0 highly diverse environments reflecting thevariations in climate and physical conditions between
one section of the country and another I's well as thesocial and economic conditions peculiar to eachregion's historical development. The growth and decjine of urban communities in any given area of the
Nation both affect and are affected by the economic
and social corlditions of its region.

Today, the communities and states of some regions
are attempting to manage their urban growth so thatit .does not undercut prized environmental and cultural amenities,-while other regions and communities
desperately struggle for whatever development they
can attract.

The old Manufacturing Belt Aleas of the Northeast
and Great Lakes areas are concerned over the declineof their cities And manufacturing towns as jobs andpopulation decentralize across the Nation away fromthe early centers of conCentration.

Nation."Over the yews, through state 'and Federal action, amultitude of arrangements have been devised to deal
with those problems that transgress__Rolpical boundaries. The result is- lodes map of cOapissions andorganizations 'that have "grown like, toPsy." Linos
were drawn around problems as we created them.
This is reflected in the creation of over 160 interstatecompacts, 12 metropolitan interstate compact agencies, 14 Federalfinterstate noncompact commissions,and nearly 18,000 special purpose ,organizations thatcross municipal or county boundaries.

In several regions of the country, the complexity ofintergovernmental arrangements thus created' hasprompted calls for simplification and a reduction in
the number of such organizations.

Some I4stern states are attempting to consolidate
interstate organizations. New England. states haveundertaken similar reviews in the past. During 1978
authorizations expire for regional economic development commissions undef Title V of the Public Worksand Economic Development Act and the AppalachianRegional Commission under the Appalachian Regional Development Act. This has drawn neW atten-

tion to the question of how the Nation might guild

Parts of the South are concerned with their rapid
growth and avoiding "northern mistakes in a Southern setting" while other parts of the South continue
to wrestle with, the seemingly intractable problerril ofon the past experiences under these arrangements indeveloping mechanisms for regional ihtergovern
mental cooperation in the future.

their scarce water supplies and agriculture.

The need for arid netyre of such regional bodies not
only varies from one darner of the Nation to another;
theit also post fundamental issues for the Federal system, As the 1935 Federal task force on regional fa:,
tors i9 national development observed:

Regionalism, Sectionalism, and the Nation"If regions with serious problems Were to be given.poverty and underdevelopment,.Sparsely populated areas the West worry about the

implications of intensive energy development for

A 1935 Federal Task Force assessing regional factors
in our national development observed:"Maior problem areas frequently ovetlap state boundaries and yet cover only a part of the whole Nation.

geographical boundaries, the tendency to defend theirregional Interest at the boundary, so characteristic ofEurope, might be encouraged In America. On theother hand, a series of interrelated regions, closelycooperating with -the Federal establishment, would99

95

I2 Development Regions

96

Nevi England
3/ 2W Si-tal Plains
7/ 2W O7

111 To join 'theSouthwest Border
Economic Deve1opment

Region in Octohr 1979.
Region designated 10/23/76
Dates represent when Commissions were organized.

tend to cement the Union end to promote the'solu- o'ccupied since 1970 with population and employment losses, particularly from the Middle Atlantic
don of Intersectional adjustments."
states, and with the decline of many of the region'sthat have speThat task force was careful to make the distinction mature urban areas, particularly thosebetween sectionalism and regionalism- "regionalism
envisages the Nation first, .making the total national.
culture the arbiter, while sectionalism sees the region

first and the Nation afterward." ,Regional arrangements that can help accommodate the enormous
diversity of needs 'and conditions among the various
areas of the country are critical to. future urban anddevelopment policies. But self-interest construed inpurely sectional terms can only prove destructive toboth national and regional interests.

cialized in manuf2cturing.

New England has had a long tradition of regional cooperation among the six nates in dealing with -theseand other problems. I ndeed, in recent years there has
been some concern dyer the very large number 'ofinterstate organizations in that area.
Questions have been-raised periodically by New England Governors about fragmentation and lack of co-ordination among competing regional groups. The

The differing character Of regional needs and aspirations can be seen best by summarizing those needs
and interests in each area of the country.

New

EnglandRegional

CommiSsion,

establishedunder Title V of the Public Works and gconomic
Development Act; provides one forum for Federal
and state governments to cooperate on regional prob-

Rgionel Issues la the Northeett The Northeast
is comprised of the six New England states andthe three Middle Atlantic states of New york,
New Jersey and PennsylVah'ia, long the dominant Jinanciat, cultural, and economic region of the country.

Regional leaders 'in the Northeast have beeh pre-

00

lems.

Except for interstate compactrat the metropolitan
level and several river basin cOMthissions, the three
Middle Atlantic states have not been as intensively
linked regionally, though some portions of New York,--and Pennsylvania are included ender the Appalchiiri
Regional Development Program.
.

i'number of cities, private Ihrancial institutions have-

19 /6, however, a large number of inform )I

released soma Of !hall most skilled managers to assist

organizations have been created in the Northeast s
forums for addressing the common problems of tl earea. Ono organization, the Northeast-Midwest Ec
nomic Advancement Coalition, actually spans theCongressional delegations of both the Northeast an0
I
East North Central regions.

cities and covniies in improvihg their finanwal man,agement. F inancial institutions have also Joined withgovernment in improving the availability of capitalfor improvement and construction in oldec'neighbor-Sinceof the nino northeastern Governors ha4
formed the Coalition of Northeastern Governors.
Legislative leadersheve formed the Steering Commit-

Seven

-

reverse economic losses and improve the produativity
Of both physical plant anq....,the vsairk form. In atee of Northeaster'n Legislators. And a Council for
Noreastth Economic Action has been created consisting of leaders in government, business, laboY, academe

and the civic sector. A similar group of local municipahand county officials has also been established.

hoods.

During 1978, the several now 'regional Organizations
are cooperating in drawing up plant for regional ecbnoinic action, though the future form and inechanism
f or regional cooperation is not yet clear.
New York, New Jersey, and Pennsylvania have joinedwith Qelaware. Maryland and the District of Columbia
in applying to the Secretary of ,Commerce for designation as another Regional Economic Development
Commission under Title V of the Public Worksand Economic Dovelopnient Act. The decision has
these organizatipns have focused much of their attenbeen held in abeyariCe pending dedisions about thetion on.the impact of Federal policy upon the region.
The Coalition of Northeastern Governors asserts that future form arid function of such regional com-

"regionalism represents a struclure through which

missions.

groups of states can highlight those issues of sharedconcern and impact." The Coalition argues that:

North Central Region T h-Central Region con-sists of two divisions, each girlte difterent in /their,"Federal funding. and investment decisions can bit
made, and should be made, to help restore or maintain vitality. The needs of our regions vary, theyaare
not easily defined in homogeneous terms. To the extent they differ, Federal aid Mould recognize thtse
differences."
While much northeastern attention has focuied uponregional concerns over whether Federal proc&ement,
payroll, arid installation location decisions haveworked tO its disadvantage, many of the northeasterngroups are also engaged in a series of regional initiatives to meet sorne,of .the area's identified problems,

economic character. The Fast. Nor th Central, or/Great
Lakes area, is the premier heavy manufactuFing/rogionof the country. The West North Central has' historically been predominantly agricultural, one by t he nation's principal breadbaskets.

However, the declintralization of induMrial location
clearly discernible in this region as it is in the country
at large. Manufacturing employment growth is occurring in the formerly predominantly agricultural West
North Central region, while it is declining in many

parts of the East North Central. And outmigrationfrom the West-- orth texttralhas appreciably slowed
while populatio growth in .the rast North Central

The Coalition of Niortheastern Governors has deen
actively exploring the feasibility of a regional energy
development corporation that would encourage andfacilitate energy develdpment projects or energy consenotion projects, Ocluding the development of eastern coal in order to l'educe regional dependence upon
imported oil and natural gas. The Coalition is also
evaluating the rail, highway, and port moldernizatlon
needs of the region. In some cases deficiencies inthese systems are serving as bottlenecks to effective
economic development in some of the region's cities.

has very nearly co ne to a halt.

Labor, management, and government have been
quietly forthing. new partnerships in a number ofurban centers and states in o cooperative effort tostates plus Ohio, Indiana, and Illinois. The latter

Relatively few interstate organizations have existed inthis region except for water resouice purposes on the

Great Lakes and along the Ohio R iver. The Upper
Great Lakes Regional Commission was establishedunder Title V . of the Public Works and Economic
Development Act of 1965 to assisrthe esse tiallynonmetropplitan counties of northern Min

sota,

Wisconsin, and Michigan. No such body wai &tablistIed in the manufacturing arid urban section's of theregion covering the southern portions of those threestates.-have joined with Iowa in applying to the qecre-

tory of Commerce for designation as a Title V Re-

lOj

98

&nal Deitslopment Commission. but Nain the decision has been withheld pending decisions about the
future of such tiodies under Federal legislation.

Pt North Central states, with the exception of
Iowa, pro embraced under the Old West Regional
Commission established in 1972. Numerous privaje
regional organizations have focused attention on regional economic issues in the past, most notably theUpper Midwest Counct1 initiated by the Minneapolis

IThe

Federal Reserve Bank.

With the resurgence of manufacturing and other employment growth, a central regional preoccupation in
the West North Central area is with Federal agricultural policy and particularly the problems of fluctuat-

the South in education, energy, waier resources devel-

opment, and a host of other fielais. The,Tennessee

Vallóy Authority, the Nation's first niajor Federally inspired regional experiment, covers parts ofNorth Carolina, Tennessee, Alabama, and Kentucky.
wo regional commissions estalAshod undet Title V
operate in parts of the South. the Coastal Plains
Regional Commission in portions of\F lorida. Georgia.
South Carolina, North Carolina. and Virginia and theOzarks Regiohal Commission covering the states ofLouisiana, Arkansas. arid Oklahoma. In addition, theAppalachian Regional. Commission covers all ofWest Virginia and portions of nine other southernstates,ing farm prices and the inability of farmers to earnsufficient return on their crop; to match inflation in

The most recent addition to this galaxy of southern
regional organizations is the Southern Growth Policies Board. governed and supported by the state

their production costs.

governments of 13 southern states. The Board serves

In the East North Central area, major concern is withOs regional forum omegional tgrowth issues and isintended to help the South anticipate and cope withstagnation in the employment base of many of theeconomic and social change.

older urban manufacturipg centers. In 1977, the Gov-

ernors of the six Great Lakes states s,tablished a
Committee for Great Lakes Economic Action which
is formulating cooperatiA plans for future efforts in
the region.' A reconnaissance of regional problems
found that:
Access to capital is lacking for new high-r isk ventures, a national and-not merely a regional problem.
Labor costs, prOductivity, work rules, and,work
attitudes are key problenis in.rnuch of the region.
The availability of energy 6nd thetssurance of its
supply is" a key issue for both existing industry andexpansion in.this region.
While ample water resources generally are one of
the region's great riatural assell that could be market-

ed to advantage, there are Ohs of the region that
suffer because.of lack of water or the availability offacilities-for water end -sewerage treatment.

Though reoccupation of central-city areas is the
key to revitalizing many urban economies in this region, land is not being converted to new uses. 41ichof the land in major, cities and-in sOme smaller towns
lies idle when it codld be turned to more productive
industrial, commercial, and residential uses.

While the region's trarisportation facilities were'major assets in making it the manuiacturing core of
the country, it now suffers from a deteriorating rail
network,., deficient secondary highways in some areas,

and there is a need to expand seaway commerce
which at present must pay tolls unlike other traffic
on Feaerally financel Waterways.

The Board has closely monitored the divergent trendsof growth in the South: rapid growth in some areas ofhe region -on one hand and persistent poVerty andunemployment in some urban centers and rural regions on tho other.

Two states, Florida and Texas, accounted for about
twO-third:of the 1970-76 net inmigration and almost
half of the population growth. Personal income andnonagricultural employe-tent increases were also cOncentrated in those two states.

While the differences between residents of the Southand the rest of the Nation have been modified bysubstantial inmigration, the Southern population still

differs significantly from the rest of the country IQ
several respects. *There are higher proportions ot
blacks and-yOung persons in the South and the educa-

tional attainment of the adult population is well
below the national average. A comparison of economic data shows the South becOming increasingly
like the rest of the country economically, but in these
two aspects corivergence with the rest,of the Nation
appears distant. 1

Southerners are, on the average, poorer than theircounterparts in the rest of the country, deppite a1970-76 increase in personal income that was above
the national rate. Income levels in the South remain
below the national averages, end the 1976 per capita

income in the South was $5,771, ninety pérceht ofthe comparable figure for the Nation, However, theeffect of lower incomes is offset somewhat by a cost
The Soirth The South, like New England, has longof living estimated to, be abbut six percent below the
had a special sense of regional identity. This is,refleCted in the large number of interstate arrapgetnInts in tnational level,l Op

Expansion in population, incorPe and employment Is
distributed unevenly between central cities and otherTh' .constructi-1of superpolts along the Gulf

99

Coast and the assoc ated secondary impacts.

metropolitan areas in the South. Older cities in theSouth are experiencing the same population dynamics

as older cities in other regions. Much of the new
Southern population growth has tended to be in lOw
density developments in or near metropolitan areasand in smaller cities and towns in nonmetropolltan
areas. However, high-density urban grow,th has occurred in some areas, particularly Florida, where resort and retirement developments are crowded along
thekcoast in multi-family units.
Industrial growth, particularly manufacturing, has
alsd been decentralized and scattered in rural areasand smaller cities.throughout the region.

Urban and metropolitan growth in most Southern
metropolitan areas has been relatively dispersed, lowdensity in character. These growth patterns threaten
to ser iously sttain the fiscal .capacities of many local
governments in the South in the future. High-density
urban living is at the opposite extreme from the cur-rent patterns of dispersed growth, which contributeto urban sprawl. Southern states and their communities will, in all likelihood, seekto implement growthruent policies that attempt.to find a middlemangroundliving.

ween 'Urban sprawl and high-density urban

Southern economic growth is closely tied to the availability of energy. Since the .South contains a major

The West The West is divided into two census divisions: the Mountain West and the Pacific Him. Following Wprld War II, the Pacific Rim was the preeminent rapid growth region of the country.. In the
1970s, the Mountain West superseded it as the most
rapidly growing area.

The Mountain West has eXperimented with numerops
interstate organizations to meet regional needs, somepublic, some pr ivate, some a combinal,ion of the two:
three Regional Economic Development Commis1 .,--.1

sions-the Four Corners Regionel Commission, thePacific Northwest, Regional Commission, and a partof the Old West Regional Commission. There. are anumber of river basin commissions. And the Federation of, Rocky Mountain States, a forum of public
and private leaders from the region has just recently
been disbanded,T

Western Governor's Conference is a long-stLing

regi nal voice in national affairs for the region's inter.
ests. And a new organization, Intended to consolidate
some regional activities, the Western Governors Policy
Office, includes diost of the Mountain states and severol other western states as well.

Efforts by western states to articulate a new, simpler
set of regional arrangements 7continue, but the region's concerns and interests arveadily identifiable.

portion of the Nation's energy supplies, nationalenergy supplies will also be drawn to a large extent
from the South.

Even though the region has rnuch,of the Nation's
energy reserves, almost all partS of the South arethreatened with energy shortages in the immediate
future, Already, curtailments of natural gas. haveCausecl severe economiC dislocations tO industries in
the Southeastern stoles./Efforts in the South to supply rerjional and nationalenergy needs will cause major conflicts with environmental objectives..They include:

The siting of new energy facilities,"including nuelegr plants and the disposal of nuclear wastes,
Increased coal production and the associated en-

vironmental impacts of strip mining, increased water

consumption, thermal pollution, air pollution fromburning coal and industrial development in coal pro.
,ducing areas.

Water is perhaps the top conceryi of western develop-

ment since the region was first settled. As Federalwater policy reviews are undertaken, there is deep
concern ,in many western states that the complex ofwater laws evolved in each of the states over a long
period of time will be jeopardizee or @usurped.

A large percentage of land in the western states is in
the public domain and therefore Federally-controlled.

Devele+ent on those lands affects the states andcommunities. Western states continually press for
closer cooReration between the Federal governmentand states In coordinating Federal, state, and local
development\plans and Federal land management.
.P

Potential devel'opment, of western energy resources
and the impactrIqf that development on local communities is ytelated regional issue. Western states pressfor Feleral-state \ partnerships in planning energy
development on Federal *lands or on off-shore leases

Outer, Continental Shelf oil ana gas development to both anticipate and cope with economic, sotial,
and the associated onshore and secondary clevelop., environmental, and phYsical consequences,. including
the construction of -new corpmunities or expansion ofment.
ex istrinom mun'rties.
e

I,

f

4

i""

v3

.

1

Tho agricultural states urge long term' agreement2i
with foreign purchasers'for American farm expor ts toimprove the predictability of agricultural marlsets.

While triore appears to be broad agreement among thestates that experience with multi-state regional.devel
opment. commissions has been constructive, particu-

Hawaii. California. Oregon. Washington. and Colorade are engaged in superate attempts to Lope withthe problems of inmigration and urban expansion.
j.The. futuo expansion of urban areas in Arizona tted

interested sour ces as dm General Accounting Of (iceand the Advisory Comnession on Intergovernmental

elsewhere require-expensive water transfers.

larly in serving a,s a forum for discussing Federal.
state, and local interests, evaluations by suc'.11 disRelations indicate that the enabling legislation .forthese commissions is ripe for reconsideration, building upon the experience of the past 13 years.

Such issues irevltabfrlTrtrnpt searches far mechanby means of wt ith Federal. regional, state, andlocal interests can be hai momzed in guiding thefuture growth and development of the area.
The Western Governors' Policy 01 fice supports establishment_ of a nationwide system of regional develqp-

These commissions have'apparently not fulfpled earlyhopes et promoting interstate cooperation and they
do not provide belirely satisfactory opportunities forparticipation ana cooperation with the private sector
and local governments. Thar present territorial configurations have become overlapping and confusing.

ment commissions to promote multistate and intergovernmental planning and development. Building orl
the experience with existing regional commissions,the group urges that the approach be so engthened
and broadened with states having the determining
voice in deciding which states ,would participate in

And% their functions and organization may require

which regional groupings.

-cooperation.

impr ovement.

substan t

1 he desire for regional cooperation on commpil problems grows stronger. It appears that there is a needfor more satisfackory mechanisrus to facilitate that

Futtite Regional Cooperation

There is a growing sense of need for coopwation inregions a the country sharing common problems to jpool ideas, to advocate common positions on the national scene, to cooperpte in approaches to specificproblem's, to provide a forum for shared decisionmaking between the local', strite, and"Federal governments and between the public and private sectors.

The Nation has experimented with a diverse' numberof instrumentalities to facilitate cooperation acrossstate lines, _some highly formal and involving compacts and legiqlation; others informal, based on little
more Athan an underwnding. Obviously no single
model fits all needs. However, there is a necessity for
the Federal government to re-examine its own role inJcatalyzing the formation of new regional organizations at both the sub-state and multistate levels, sinceit 1-tas been a primary stimulus for proliferation in(such bodies.

In the next two years, .Fedelal policy on regionalorganizations should be reviewed at two levels:
The role of Federal categorical programs in creat-

ing regional bodies at the sub-state level that may
further compound the problems of general governments; andThe role of the Federal government in stimulating
and supporting the forMation of multi-state organize-.
tions.

1 04

.4. lmpaot of Federal Policies upon Urbane' Development"The influence of Federal policies in the geographic,distribution off population and bconomic activity )spowerful everAhough these policies, by themselves,are not the sole cause of shifts among regions, within
our urban areas, and between metropolitan and nonmetropolitan arels.. "..Peoposed major new Federal
legislation-, and administrative regulations should beanalyzed in terms of their projeeted economic, geographic, environmental, and other impacts."

Federal highway construction that has encouraged
rural and suburban growth and tended to hasten thedestruction of some urban communities; location ofederal facilitieS iii suburban rather than control city
regions; procurement of Federal goods and services
without regard to their urban impact, and failure totarget the extensive Federal aid already given to localities to distressed urban areas. (Indeed, Federal aid

has become a mainstay of city finances, rising fromless than 10% of local revenues in 1960 to 40 percent

Dr. Charles E. Bishop, President of the
University of. Arkansas
Summarizing some workshop deliberations
at the White House Conference on Balanced
National Growth and Economic Development,
February 2, 1978

The United States is not alone in feeling the consequences of urban decentralization. The same trends,
though. not so far advanced, have begun in other advanced industrial countries. In Great Britain, thei:erecently has been a pronounced trend toward the dispersal of population and employment out of the large

or higher in 1978 in many urban communities. Because of the distribution of revenue sharing and block
grants, Federal payments to the average municipality
from 1969 to 1975 rose 50 percent more than ,payments to ten major older cities.)-.The alarming fiscal, unemployment and -population
trends affecting many of the Nation's communities,

particularly the older cities of the Northeast andNorth-central regions impel a new reassessment ofFederal urban responsibilities and programs.

During the ,last several years, there have beeri several

central. cities of that country. In France and Germany, manufacturing is decentralizing out of theattempts to gather the findings of fragmentary research on the impacts of Federal programs and tocities and declining population growth rates have led
to inner city and inner suburb population losses resembling those in the United States.

present 'those findings within a coherent framework.
While many uncertainties remain, the aggregate results of policies adopted incrementally can now be dis-cerned. Below are discussed some of these policies
It appears as though modern transportation and communications, reinforced by changing production technologies, the footloose character of many firms in a
post-industrial econdmy, the grol,sving influence ofresidential amenities upon population movements,
and the inadvertent consequences of public policy are
underwritihg the decentralization of ,population andecivomic activity in the United States and elsewhere.

While national policies.and programs are not a primary cause of these &lenges, they do appear to havereinforced and abetted them. In some instances they

have aggravated the problems of communities andindividuals attempting to cope with economic andsocial change..

It is perhaps symptomatic of the piecemeal evolutionof national policies and programs that until receritly
we were unable to state with any degree of certainty
what their cumulative consequences for the development of the Nation and its communities appeared tobe.

Several major Federal programs and policies havereintorcedoften inadvertently=the trends that caufe
cities to decline. Examples are Federal fundlifi
water and sewer syterns that have favored construction of new facilities over rehabilitation of old ones:

and their urban results.

The Urban Impacts of Transportation Policy

Highway policy and decentralization The impact oftransportation on the size, shape and economic condi-tion and social character of human settlements ispervasive. Until the latter part of the 19th century,
the relationship among various urban land uses wasdetermined by walking distances, whic+) created highdensity development at the center of cities and a mixof human activities that were dependent on eachother foo interaction and mutual support. The introduction of public transit and suburban trains allowed

people to travel farther to outlying areas. Automobiles permitted even mone decentralization, Los
Angeles, for example, wós first shaped by streetcar
transit; not until the 1950s did the many small municipalities that made vp the city fill in the undeveloped-areas between'.

The most powerful direct Federal action that has contribUted to metropolitan decentralization and central

city decline, the opening 9, of nonmetropolitan
Amer,jca, and the regional dispersal Of population andectmomic activity has been the construction Of theinterstate highway system.

105

4

102

Initially, reductions in travel atime along interstateroutes radiating from principal cities enlarged thegram in the history of the nation. Its impacts oncommuting sheds and trading areas of metropolitan
centers and the kirge non metro cities, accelerating
the relative decline of distant small communities lying
beyond the enlarged commuting sheds. They thenopened up nonmetroPolitan cities and smaller andreedkrm-sized towns to manufacturing locations. Industrial viocation is now- much more "footloose" be-92 percent of the system was open to traffic: 4 per-cause It can draw its community work force-fromgoal has been achieved, although two-thirds of alllarger areas.

interstate traffic is within matwpolitan areas. Indeed,
one fifth of all urban transportation is interstate hight,_,

urban and rural areas have been enormous. By 1978,
cent was under construction; :3 percent was approved
but not yet under construction; and only one percent(about 500 miles) was not yet approved.

The originaLjustification of the interstate system wa,sto connect cities, states, and multi-state regrons. This

Ironically, these improvements have enhanced the ways.
locational advantages for manufacturing in many nonmetropolitan -areas at the same time they have en-

abled rural residents to commute to and shop inlarger communities. an hour or more away. A new"rural" environment has thus been created that is
linked closely with large yrban centers 50 or moreamiles awty-:-.,)At the same time beltways wrapped around metropolitan areas created a new physical structure formulti-nucleated 'metropolitan development patterns.
This further contribbted to enlargement of metropolitan commuting sheds by pruning away the slow

Some of the most controversial segments of the interstate highway system are -those which will be ysed ascommuter highways, such as 1-66 connecting north-.
ern Virginia suburbs to Washington, D.C., and 1-85

northeast of Atlanta. For segments like these, final
approval has often depended on inclusion of transit
benefits such as special rush hour bus and carpool
lanes.

increase in urban transit Most American cities today

reflect the primary of automobile transportation:al-though a modest increase in transit ridbrship has been
evident
in the present decade. Transportation policy
center city segment of the commuting trip fromisbeginnirt
to address highway and transit systems inrural locations.
a more integrated way: Both Federal and state poliConstruction of the interstate system has aramati- , cies are now concerning themselves with needs tomaintain highways that are already in use and to offer
cally itduced travel time between cities, conferring
a ne:,v competitive- advantage on trucks as conveyors communities the choice of better public transit asof commerce. Combined with the massive attrac- well as transportatiqp by private automobile. The settion of inter-city passenger traffic t15 the airlines, tlement patterns of the post-war years drasticallythis has reduced the rail network to heavy retiance undermined urban transit. At.the same time that highways were being built to provide access to the 'subon bulk freight.
urbs, the flow of population out 95 the city neighborDecline in highiNay construction An important trend tioods cut the usa of public tr a, after which service
in national transportation is a decline in new highway revels were reduced, makin public transit less attractive until the only riders left (outside of rush hour)
construction. The major reason for this is because thewere those with no choicethe young, the old, andinterstate highway 'system is almost completed, notthe poor.
because there has been a decline in automobile usage.
This rate of increase in new highway con,struction has
Only in the last few years has transit use begun to reslowed since the 1960s and especially sincejhe early
cover lolightly from a 30 year decline, increasing rider1970s. For the three decades from 1930 t 1960, theship since 1974 about 0.9 percent per year, During
average annual increase in the total surfd mileage
the 1960s the total 'number of transit passengers deof roads and streets was .3.7 perce , During thecreased 2.4 percent per year, and 1.4 percent per year.
1960s the average annual rate fell to 4 percent, andsince 1970 it has slaved to one perce t, with a shift from 1970 to 1974. The decline reflects the migrato maintenance. While the Nation's irkerstate high- tions to the suburbs and also the migratiorr from theolder, denser cities of the northeast to the less cen-'ways are generally in good condition today,_andtralized
towns of the south and W'est. Major transitmany are relatively new, dxpensive maintenance prooriented cities like Boston, New York, 41d Philagrams are needed to k p them safe and comfortable.
delPhia have lost both population and transit ridership in recent years.
nitaring compleIThe interstate highw system,
tion, has been the most ambi ous public works pro.

106

Improving urban rail and bus transit The National
Mass Transportation Assistance Act of 1974 reSulted

from (and also stimulated) considerable interest inrail transit. About sixty applications from citieS for
subways and aboveground rail systems have been sub(Pitted tc1 the Urban Mas. ransportation Admitstra-tion (UMI A) since 1974. Because the interest ar ex-

ceeded Congrepional. appropriations, ald to encourage more efficient transportation, UMTA has
réPuired cities,to slow that others less expensive tran-

sit methods wer-e-tried or considered. The requirement for an "alternatives analysis" to Me submittedwith applications tor transit proposals has beei-111-1

important aid to improving transit quality and efficiency.

tter cities have carefully compar6d the. merits of raild bus transit, many have discovered that theirspread-out -neighborhoods, businesses and shopping
areas make bus transit more practical. A good bus
system costs less, and routes can be adluste'd to accommodate shifts in population or cohlmerce. Also,
improvements to bus systems can kit made quickly,
unlike rail systems that take years to plan and build.

Since its inception in 1964, UMTA has provided
Federal financial assistance for the acquisition of
buses, maintenance or upgrading of vehicles presently
in service, and transit-related faci,lities, and for operai
ing subsidies. In total, UMTA has provided funding. for the purchase of 32,220 buses during the last fourteen years. MRst of the buses purchased were replacements; less than 5 percent were expansion to existing
stance was
fleets. During fiscal year 1977, Feder
total
of 3,808
given to 132 urban areas to purchassapproxi
matenew buses. The 'total purchase cos

ly $300 million.

Federal aesistance has provided to urban and rural
areas a wider array of transportation options. Specialuse vehicles, such as buses specifically equipped forthe elderly and handicapped, have been funded under
the grant program, enabling those with limited mobility to become more active participants in the regional

Minneapolis-St. Paul area,tave regional governments
authority to carry out comprehenwith legalt_plans.
One recent study indicatessive developrithat effective land use policies,in urban areas can substantially increase mobility while Conserving energy as
well. 1,he potential is especially great in areas where
new growth is occurring, such as the South andSouthwest.
Urban areas with new rail systems, like the Washington, D.C. area, are experiencing substantial increases
in property values near transit stations. Ultimately,
greater density' will result. Thus economic incentives
resulting from the new rail system may bring aboutsome development similar to that which land use
planning would have achleved, but without the benefits of coenprehdnsive planning..

A Depaktment pi\ Transportation report in 1977
'studied the land use impacts of older rail transit sys-,
terns in U.S. cities, new rail transit in Toronto, Montreal and San Francisco, and other transit systems
such as light rail and busways. The report concluded
that recent transit impro\fernents have been important
inducements to higher-density development near transit stations, but only when supported ky demand for
new office space and, apartment dealopment. In
other words, the transit stations helped determine thelocati6n of new demand, rather than generate them.
The report notes that while ma.jor 4ransit improvements may not cause net gains in urban economic or
population growth, other urban goalssuch as mobility, air quality improvements, and safetycan beachieved.with transit development.
New Federal transportation policy New highway and--transit legislation sent to Congress in January, 1978,
represented a year of_zork by the Administration and
the Congress to integralbthe highway and transit -programs. Extensive hearings had been held in May andJune 1977 by the House Subcommittee on Surface
Transportation.
The proposed legislation

cludes three majOr goals

economy and social life.

to improve urban transpot1on planning, to makeTransit and lend use Perhaps the biggest debate
about public transit concerns the interrelationship between land use decisions affecting future patterns ofgrowth and transit decisions. A regional planningapproach linking the tho has had ationg support.
Some foreign cities, like Toronto and Montreal, have
limited commercial and residential high-rise buildings
to areas within walking distance of a trapsit station.
But comprehensive' planning for transit, housing, andcommercial development has not been very successful
in this country. Only a flaw urban areas, such as the

To improve planning, the proposed legislation would .4r
consolidate highway and transit planning funds andprogram regulations. The need to improve transportation planning at the regional level has been appiprent
for several years, and in 1975 DOT estabIishea therequirrrient .for Governors to designate' "tnetropol-

funding pore flexible, and to c mpletb essential gaps
in the interstate system, The Administration alto has
proposed slight increases in surface transportation
funding, which in total would .amount to more that-)$50 billion during the four_ fiscal years 1979-82.

"

1 itrib

104eitan planning organizations" (MPOs) to make transportation decisions in urban areas. f3ut most MPOs
lack -reM authority and financial independence tocarrj/ out their decisions.

mains'the sa'me. 'The proposed legilsation calls for the

The proposed legislation would give new support te
the MPj.T.
s and to regional transportation planning.
unds for urban areas with a population ofPlannln
one million or more would be distributed directly tometropolitan planning organizations. DOT has proposed to review and approve transportation plans forthese areas and to assure consistency with nationaltransportation, environmental, and economic goals.
Smalleri urtyn areas would receive funds distributed

The Urban Mix of Water Resources Policy

through stare governments. 1 he planning funds could
be used. for highway or transit planning, at the discretion of the metropolitan planning organization.

Federal* share on all substitute improvements tO be
increased to a uniform 90 percent to provide a uniform basis for transportation decisionmaking

A crazy-quilt Federal ater policies have grown up
in an' uncoordineted to .y-turvy fashion and aro carried out through a craz quilt qf Federal agencies andprograms. At present, about 25 different Federal
agencies spend approximately $10 billion for water
programs. Half of these funds are spent by the Environmental Protection Ag4icy and other agencies toprevent water pollution by supporting' and encouraging the treatment of municipal waste water. The remainderisspent by the Corps of Engineers, theBureau of 'Reclamation, the Soil Conservation Serv-

Flexible use of transportation funds is fhe second ice, the Tennessee Valley Authority, and by otheraajor goal of the bill, which would set the Federal ° agencies for planning, construction, maintenance and. share at 80 percent for most highway and transit operation of water projects, largely in ordei to supcapittl projects, rather than the airrent 80' percent port the development and use of water supplies.
-for tWsit and 70 percent for non-lnterstate highways. DOT argued that the Federal share should be These various water development prograirs are aimed
water supplies for land irriga-'
the same for all surface transportation projects scr at such objettives
that there would be no bias toward either highways tion; municipal and domestic water systems; floodor transit. The proposed bill would also combine tural c6trol; navigation; hydroelectric power; recreation;transportation "assistance, including operating funds
for the first time, into a single program under statesupervision. The "urban systems" Program enacted inand protecting fish andewildlife.

1973 would continue with its flexible highway anddeveloping anct cleaning up the Nation's supply oftransit program.

water resources are declining as a portion of the Federal budget and relative to Federal expenditures onother torms of natural resources, they are very large",
and undoubtedly affect patterns oaf urban and regional

The third major goal is to complete the essential
intercity gaps of the interstate system. The DOT
Secretary has stated: "For the past twenty years, na

tional policy has directed a large part of Federal
financing for transportation toward construction of

Urban water, Although overall Federal investments indevelopment. Of the $7.1 billion spent in 1975 20
percent went to the Middle Atlantic area, the single
largest recipient. The Great Lakes area end Ohio re-the interstate highway system. With most of that system now built and in use, the time has come to bringthis landmark effort to a sound 'conclusion."ceived another 17 percent. Substantial additional

The proposed legislation includes several special fi

funds to start constructing the final segments of theinterstate system promptly. Approved segments
would, have to be under construction by September

Expenditures aimed specifically at water quality andpollution Control comprise a substantial portion of
the overall
into the Middle Atlantic andn 1974 .over halt of Federal exGreat Lakes
penditure§ for water quality management went into

30, 1986.

these highly urbanized areas.

Under existing law, the governor and the relevant

Significantly, Federal expenditures aimed at developing and using water .resources are distributed quite
differently. The region receiving the largest share ofthese water develqipment funds is the Lower Missis-

nancing mechanisms to enable states short of highway

local governments may .withdraw non-essential seg-ments and use an equivalent amount of funds on
ether highway or transit projects. However, the Fed-5erel share is reduced from9Opercent forsinterstates
tos:A0 percent for substiute trapsit projects, and to
1.6; percent for substitUte Federal-aid highway projects, , although, the total amount of Federal-aid re-108:

funds.went to the Southeast-and 6ulf coast areas, theMississippi basin area, and the West.

sippi area. The Columbia-North Pacific- and South
Atlantic areas follow in the second and third order;
Growing areas of the Nation receive large shai-es

of Federal invesNents in developing their water
resources.

,

400.

Cojierying water and urban grOwth consequences
The President's new national water policy which emphasizes conservation could affect urban area§ andby:differently.
development
Bearing dowri hardest on those regions where
overall water use and growth in Water needs are most
rapid, i.e.. the growing regions in the Southwcst open
ing up to intensive u?ban development and populations yrowth. These ary tho "water shortage" regkons.

Stressing more efficient water pricing which is,likely to reallocate scarce water supplies from irrigations to Other uses, including urban water users.
."

Rewiring stntes to pay a share of \Miter projects

Effect of Federal Tax Systprn on the Relative
Profitability of Investment in New Rental
Buildings as Compared with Investment in the
Improvement of Old Rental Buildings
Coristrut-tbm ofin.), aovemont of

Now Ilvnial

Okl Rental
nulkiln913(lipirm.

.

20.(Pfi

Pretax return(assumed)

A14(pr-tax return (60percent tax brack9t)

21.6

14.8

Atter-tax return (30percont tax broaet)

20.8

-17_1

akl encouraging water prices which will covar fullproject costs. This could reduce the real 1ederal sub

sidy of the expansion of urban water supplies inmany growinj areas-of -the West, 6nd thereby affe.ct
the rate and type of growth,in these areas.
Affecting the locations of urban development andthe initial, short term covs of developMent that does

investment then any of 'the' g'rant-in-aid programs,'
with the possible exceptions of those for highway
construction and wastewater treatment.

Tax deductions allowed homeowners for interest payit) the flood plain. A por tion of almost every ments and property taxes have tended in.the past to
civor- high-priced, low-density construction of single
city in the Nation lies in the 100 year flood plain.
family homes. Renters have been disadvantageOl.
Overall, the national water policy could lead to ma . While condominium construction within alreadydeve ped,- areas -benefits from this incentive, it isginal reduction in groWth pressures,itial the-Ai-this provision in the tax Code be evaluated in light of the need to encourage homeownership
The Tilt of Tax Policy ToWard Newilessand upgrading in established urban neighborhoods.

A study by theUrban Institute finds that, more.by
accident than intent, Federal tax policies have had asubstantial impact on the shape of the Nation's urban
development.-.Overall the study found that Federal
tax policies h&e:
Favored low-density urban sprawl over compact
development;.oAccelerated the rate of decentrali/ation in metropolitan regions.

Favored investment in housing an& other structures over alternative investments in,the economy;
Favored the canstruction'of single-family dwneroccupied housing over multi-family rental apart-

Depreciation schedules tend to...favor 'investments in

new constructiOn over rehabilitation by allowing
more rapid depreciation of new construction. Thesesame schedules also encourage rapid turn-over in own-

ership and tend to discourage maintenance. As one-tax authOrity puts it: "The inoentive is to build,
depreciate, sell, then build again. -1 his creates an in-.

ducement to continue constructing new builngs
where land is cheapthe land cannot be depreciatedwhileiallowing older buildings to decay."

Favored the development of new commercialindu-sqial, residential, knd public buildings over the

The Council on Environmental Quality has reported;that, in the eyes of some expert obsrvers, capitalgains tretment is perhaps the most imporfant Federal tax provision in stimulating the conversion ofmaintenance and repair of existing structures.

open rural land to development.

In general, provisions in the Federal tax cocte havefavored new construction and outlying developmentin suburbs over development in existing neighborhooth, thus contributing to central city housittg ab4ndonment, deterioration of existing urban invikstment,

However, the Council has also draWn attention to the'need for states and localities to re-evaluate the consequences of their -own 'tax practices. In particular, themerits;and the decline-of central city taX bases.

Perhaps the most consistent bias in the tax code
favors investment in new structures relative to investment in the improvernent and repair of existing buildings. In. many instances, tax regulatory pblicies pave
more profOund consequences for the Oacement ofstructure of local property taxes kid the relativeemphasis upon improvements must be re-examirred.
The. Council obierves that "at present, land in urban,areas tends to .be undervalued and the improvementson land overvalued for tax purposes. Consequently,
landowners in urban areas are discouraged from restoring structurally -sound buildings or replacing deteriorating ones with new structuret, since such improve.

m

1 09

merits will raise taxes disproportionately. On thedeveloping fringe of urban areas, low taxes on raw

106

land have encouraged speculative purchase ond leapfrog development," Site value taxation ,is an alterna-

has the Federal shale dropped back' to the level thatpreceded the growth.. The year 1975 apparently
markea the beginning ,of a new growth period. %kith

the ratio, of Federal aid to state and local receipts

tive worthy of wrious study arid debate at the statefrom own sources piedicted to reach 35.3 percent inand local level.

1977.

Estate taxes and other alernews in tho tax codes at
each level of governmentiolso have an impact on thedisposal of land and proberty.

Alorig with tho rise in signif icance of Federal grants in

Use of the tax code to-achieve special purposes has
sometimes generated windfall profits for a few at theexpense of communiVes and individuals. In deter-rnining tak policies appropriate to future national
urban policies, it isiassential that careful evaluations

be made of the possible consequences of any proposed tpx code incentives in order to detect Ilossible
perverse results in advance.

Shifting Federal ExpendituresSouth and Witst

Federal expbriditures in several forMs have played
instrumental roles, in affecting regional and local

state and, local budgets, iMportant shifts have occurred in functional categories. Federal aid for oublicwelfare has increased only slightly as a percentage ofstate and local own-source revenue since 1954. Grants
for education showed a slight increase between 1954
and 1964, with a substantial mowth in relative importance since then. Highway grants reached their peakshare of state and local revenues in the mid-sixties
and. hav since declined. Grants for housing and community development have Ocpanded significantly but
are still small in the overall picture. The most dramatic expansion in Federal aid, especially in recent years,
has occurred in general revenue sharing, some of thenewer block grants,.and grants under the Comprehensive Employment and Training Act. Changes in thecomposition of Federal grants contribute .toth.egrowth. The location of Federal installations, thechanging'patterns of regional allocations.

patterns of Federal procurement, and the.distributionof ,Feeleral payrolls all affect patterns of regional
development. Since the Korean Conflict, thore has

As of 1975, two regionv-thel Northeast and the

been a substantial shift in the patterns of procurement and the location of installafions and Federalpiyroll in favor of the Southern and Western regions
and away from the older industrial areas of the North
and Midwest.

West --received greater percentages of Federal grantsin-Aid than their respective population percentages,

while the other two regionsthe Midwest and South
received smaller percentaglohan their populations'share. The Midwest's share oTTederal Md was also lessthan

its shanrof national income. For each of theother regions the picture is to some degree mixed.
Federal grants-in-aid haiie become an increasingly important element in Federal expenditures.

Federal grants to state and local governments haveexisted for 'a long time, but only recently have theycome to represent a significant part of total Federal
spending. During the 1950s and 1960s the share wasless than 10 percent of all Federal outlays, but since.then it has increased rapidly and is projected to reach
17,8 percent in fiscal 1978. Grants to state and local
governments for payment to individuals, such as pubmake up a little overlic assistance or Medicaid,
one-third of the 1978 tole). The remainder consists ofgrants for education, training, employment and social
services; commerce and transportation; community'and regional development; general revenue sharing;natural resources, environment, and energy; and avariety of other intergovernmental aids.

Fedittral aid elsO represents a growing share of stateand local government revenues. State and local de-.
pendency on Federal aid has shown periods of rapid
increase followed by a slight tapering off, but neverp.

11

Total grants per $1,000 of personal income and as apercentage of total .general revenue in 1970 and 1975twere highest . in the South. The West and the North-east had the highest Federal aid per capita in 1970 ,apd 1975 respectively. In both 1970 and 1975, theMidwest was lowest according to every measure.

Between 1970 and 1975, the Northeast moved frombelow the national average to above or approximately
even with the national average by all three measures.
During the same period, the-Midwest remained below
the national average in all three measures of Federal
assistance, while the West stayed above the national

norm for two of the 'three measures. The South
posted above national average figures in grants aS a
percentage of total general revenue and grants per$1,000 of personal income, but the per capita measure for 1975 was below the national norm.

Although the absolute per capita, amounts show
the West as the leading region in 197Q, the directionof .change cturing the five-year jieriod illustrates

4

11

Ratio 0/ Federal Grants-in-Aid to stateand Local Receipts frornOwn Sources, 1960-77*

Historical Trend of Federal Grant-In-Aid
Outlays (Millions of Dollars)
Federal Groats as s

Cempes *lei el

Poccentege

eniate-M-Ak1

grits *r
POTS WON

fir MAI

40

Stele end

Federal Ostler

Local

Yew

&NO

Imilyideols

Besets

TuüI

Demtstle

Capone/Nos'

1950
1055
1960
1965
1970

.8 2,253
3,207
7.020

$ , 1,421

832
1.437

5.3
4.7

88

10.4

12.1.

10.1

4,285
6.950

76

15.9

14.7

9.2

15.151

12 2

21.

19

1971

25.,109

17,320

13 3

211\

19 9

1972
1973

34.37241.832

14

17 0

77.8
24 6

1974

43,30849.72359,037'20.95128.72829.27833.81839.528

16

23 3

15 3

21.3
21 7

22 0
24 3
22 7
23 2
24 7

10,90424.0181975
1976

ItarlsItion
Ouarter
1977 Estimate

15.909.
72,445

1978 Estimate 81;682

1,770

2.735
3.954
8.867
10,78913.421

9.104
14,03016.10519.511

5.122

23.65025.818

1 07

36

30

15,3

16 1

10,784 16 8
48.895 17.4
55,866 1f.8

22 6
23 3

25.5

24 1

28 5

25

20

1'5

1960

1970

1965

19/7

1975

st.

A

27

Fiscal Years

2 A. %Wino(' In tho notional IneOnlo oCOOunts

Featoiol butigol outlays to. wont. in ;10 reiattml to Moto and local ntooloht 11()M own
soutcoo so deInsti.ln 114 notIonat income accounts

Sources: Special Analysis, Budge( of the United Stales Government, Fiscal Year 1978, p 273 Estimates for 1977 and 1978 from

Source: Advisory Commission on Intergovernmental Relations
memorandum on "Fiscal Note." March 16, 1977.

holudoo outlays toe Into notional (Worm+ and !Morn/Mon& ottani function.

1

I.

OPAB Supplement, March 4, 1977.

4,

Regional Share ofAggregates, 19 70 and 19751970

El 1975%

A.
1

Share ol U S Personal Income

Northeast

1970-1975.%%%%%%%%%44%%%%%%%%%%%%:%%%%%%

West

-2 1%

Northeast

2842%

- 6%

Midwest

+2 0%

South

7%

West

27 6%
26 7%
28 7%

South

X%

16

18.1%
18.8%

a.
imi="

+

MN,WaVONMMW%\XW 24.2%

SouM
West

\\WWN .%\\M \\\W 21.2%

\WM.

\'WN.

+2 2%
32.5%
30.9%

211%

-1 6%
-1 9%

19 2%

Northeast

,

27.9%
27.1%

- 8%

Midwest

,WW%

South

%,'W%\\\%%,\ Vs.'W%.\\ 4%% 24227.1%

West4,,M,A1V=1%%%%%%.%%%%%%%.%%\%%%%%%W.%%0 30.6%

11111111111111111i111111 32 0%
17.2%
17.8%,+ 2 3%

111111111111= 23 4%- 1 0%

23.2%

Mtdwest24.2%.N,N .N1 \WM . MV

,N

11111=1.111111111MININI=11 26 5%

4. Share of Stale and 1.oalliwn-SourCe General Revenue

2- Share.of Population--,;Northeast

Share of Total federal Aid

27.0%

IN11111111 24 9%

Midwest3+ 6%

W\NNWASMN,%%\N 27.4%
27.1%\ M.%\nMOOMMIIIMMINOMINOMI
21\1

20 7%

11

.0 3%

108

Distribution JiTotal Federal
G'rants by Regl n, 1970 and 1975

In the West, 10 out of 13 stales do bet-ter than average. Lven when Alaska, with $740 -per capita, is removed, the West still receives $240 per capim, Without. Alas144, the variance is lower than that of theiitilil-e
Midwest

Northeast

Federal Aid

South

West

Ai ri

isi

/20

246

Nalit-ilitxr 4410:Z4

Per

Ns

Average

4 47Vilro.

1(375rr it.000-i.a.t,t-,.&.-,,,,,
Zipli"..iiy,...-,..--:-1-, .,-, ., it ...;:-)
vis . ii----'"--.40-- V-- --3Y--

al Pylon,'
income (S)

',..-

.

Revenue pc)

W hin Region
Range in Per

Capita rp

44

1975

-tete,

Iel

1975

21 3

As a Percentage 4o Total Cionetal

260

Mi?iwest.4/33

Capita (1)

.

'- 1-

' r2' '--19 4y4.4.:,

At :

74 7

19 7

71 8

,.01,

vitA .P.

44 t .s-T34 I.

: :1

'
.

Distribution ol Total Grants by

43

44

46

35

Region, 1975 (Dollars Per Capita)

0733 National Average

Ai- 4WO 116-178

,

.

1975

105 37/

67-165151 3)1

,

:".-,

75435

W-14

poi

4

h4
)

Per Capita Grants andAbsolute Change in Per

Capits Grants. 1970-15

MAr,

r.
.
0.( h slate A,0 Wesenta

/10

N11

1.,11

97

109

9

,

/0

,AJO

110

10

l',0

....

-191Midwest

-

4

143

ty11

7g.
Northeast

Percentage Change M

Mt

157 1 009 7011 739 157 1 009

113

South

Appena,Sources Academy kw Contemporary Problems stall computeWestliOns based Oh the 1970 and 1975 editions of the Department 01
the Treasury. tederal AK! to Siares. and the 190970 and 1974.75
edmons 01 the U S Bureau of Me Census Governmental

0 itaeN Atrorp

frnanceS

i

.

it

.
.ce

fir

CC

1.r--;In

Note II Washington. DC is replayed from the South. tho regional moan
drout from 22010 211 and the standard deviation tills 10 36.0. Similarly. theexclusion of Alaska from tho Wool reduces the regional average to 240 andthe standard deviation falls to,213 29

relative movement toward a regitmal balanceof -Federal aid delivery, reflecting previous ,policy Source: Academy for ContemporaryrProblems stiff computationa
on U.S Department of the Treasury, Federal Aid to States.
changes in Washington and perhaps a regionally dif, based
1975.
ferential effect/of the recession. The differential bea

tween the Northeast and the South was' reduced Iretween. the 1970-75 period with the Northeast actually
sur ssing the South in the 1976 per caiita measure,This anking'of regions changes when welfare grantsareliminated. The West became highest in 1976, andther Northeast fell to third. Thus, the inclusion ofrecession induced grants may not reflect the underlying full employment trend in-grants.
It is misleading to draW inferences from regional data

Hidden DeveloPment Aspects of Regulatory ftolicies
Regulatory agencies, almost by definition, have a responsibility to be judicious and nondiscriminatory intheir policies with respect to regional equity. Whilethe commissions regulating transportation must consider equity, they are more concerned with maintain*
ing strong national systems than regional or urban
balances.

wit0out examining i dividual state data. While theie mgst money per capita in Attirpts to have regulators take other natio* ob; four out ot,Jiine slates received an arngunt Oectives into apcount, particularly those that affect

Northeast, received
197

below the pationaT average of $233. Vermont is ansouther with $327, but it is New York's $313 per
capita and higb population weight that pulls the re--/gional average up.

regional development, have failed primarily because
the imposition of such objectives is taken to mean the
conscioUs applitation of inequities in allowing prao-

tices within a regulated industry to vary from one

national average, Even With South Dakota's $312, thesection of the country to another; Regillatory policies
have had and do have a profound impact Om the patterns of national development,.howevor, because theyvariance in the Midwest is fairly low (the, lowest of
the regions). Almost all of the states are in the same

contain "hidden" development policies.' There aredevelopment objectives implicitly built into certain

position.

regulatory practices. ,Railroad freight differentials
have had 'major consequences for regional and urban

In the SOuth, eight of 17 states lie above the nationtil
average. MucNrof the varian0 disappears when thedevelopment in Ole past and regulation of the rails

Only two of 12 states in the Midwest lie above theDistrict of Columbia Is take6 Out of Ole region; its
grant allocation in 1975 was $1,0
1.5

*capita,

may have helped 'tlistidvantage rail freight over motor
freight. che steady decline of railroads has had prOfound implications for many sections of the sountry

11 2

resource object ivelits well,

Urban Shaping Consequences ofSewer and Water Programs

Regulation of airline rates, has, as one objective, ores-

The construction and location of sower and water

rvice into loss profitable areas of theervation ofcountry by pr pping up the rates on profitable routes-in order to cover airline costs on unprofitable routcl.
This has led to both problems and cut-throat competition on profitable routes.

facilities have had a powerful effect on the cost, pattern and timing of urban development in the Nation's
metropolitan ardas. In terms of land value, manystudies have shown that sewered, vacant land in thesurrounding metrpolitan suburban ring is two to fourtimes the value of unsewered land in the same communities.

and confounds the attainment of environmental rind

1

The Interhe Commerce Commission in tin attempt

to preserve some share of the market for railroads,
water carriers, and trucking firms, sets prices for allmodes at roughly the costs of the highest cqst mode.
This policy has been justified on the grounds of protecting a balanced transportation system. Its immediate consequence may have been to keep transportation costs.artificially high, thus forestalling the employment of lower cost technologies.
There is some possibility .that roderal and state air
and water quahty regulationstied ultimately to public healthwill reinforce residential dispersal evenwhiie other national objectives may require curtailment of that process. It is too early to document
fully such a trend, but it is fairly clear that thd regulations can contribute to the cost of housing by raisihg
thefrice of land.
I.
A

Regional Varianc-of hsComeiSecurity.,.pA

Welfare programs have been pre-Sumed traditionelly tohave had significant influence on the direction of migration flows in recent decades. Present evidence does

not indicate any profound effects from the welfare
differentials that exist between states on the initialdecision of migrants to move. The possibility of employment at the destination or the fact that kin havemade the same move seem to More imporlantly affect that dedsion, However, there is some evidence

Specifically, in terms of land use, sower and water
facilities affect land use predominantly by increasing
the supply "bf developable land in urbanizing areas.
1 he amount of increased land supply has been essen-tially dependent upon "excess capacity"that is, ca-a
pacity beyond that needed to handle the peak flowfrom the present urban popullition of the particulararea served. This feature alone has helpea to induce
excessive growth 'and urban sprawl in metropolitan
areas. Also, in the past builders and landowners havb

felt that they-can develop land at the urban fringe
and use septic tanks and wells with the hope thatsewer and water funds would ultimately bd available
for localities to ex"tend sewer, and water facilities andlines.

Thus, like highway policies arid programs, sewer andwatei policies and programs have led to urbarliecen.
thlikation and sprawl. This has been espedally true.
of the wastewater treatment facilities grant program
under the Envilenmental Protection Agency which
provides billions of dollars a year in sewer and water
facilities. This program has unwittingly contributed
to the underwriting of suburban sprawl in metropolitan areas mainly because of its "excess 'treatment ca-

pacity" criteria in the construction of interceptor
sewers end treatment plants. Moit of the communities benefiting from this-program have been in subucrban locations.

that higher welfare payments may persuade a migrant
to stay in one area rather than move to another once
he has arrived and has failed to find a job.

Federal sewer and water assistance to States and locelities, however, can be strategically useful in direct-

The regional impacts of different incOme isistence
programs vary.' Retirement income is genesally dispersed, but with some concentration in ,the "sun-lations to feclOce sprawl which would prevent the creation of dnneeded excess wastewater treatment ca-shine" regions, though even this pattern is changing as
the number of retirees in such areas as northern Mich-

igan and northern New England is now growing.
Other income security payments axe concentrated in
the poorest counties and central cities where the lowest incomes and poverty have their highest incidence.

ing the pace and pattern of groWth. In recognizing
this', EPA has recently proposed a number of regu:

pacity. One regulation will require that population
projections for all communities in a given state, when
added together, not exceed the projections of the Bu.,

reau of Economic Analysis of the Department ofCOmmerce for that state by more than five percent.
This population estimate will insure hat those wastewater treatment facilitiesacehich ar built meet only

If

.113

1 09

110

"reasonable" growth needs. For the same reason, en-other of EPA's proposed regulations requires that,barring special circumstances. tht design poriop forplanning interceptor sewers be limited to twenty
years. Finally, in order to protect environmentallysensitive areas, such as wotfands, flood plains, andprime egricultural lni. EPA wilt discciyrege collection systems which

buId encdurage now growth onin many urban areas.) Millions of buyers of this housing have made great use of FHA/VA home mortgage
progrems, althobgh thole has boon p decline in use ofFederally insured and guaranteed loans to financehomes since 1970 when it was 17 percent jor all now
units nationwide.

Beyorld the sprawl and decentralization of urban
areas, past Federal housing policy has also provided anthose areas.

In additiop to thoso measures, coordinating the wastewater facility construction program with the areawide
water resources Warming program ahd strengthening
the role of metropolitan agencies in dealing woh contral city and suburban wastewater needs on an area
wide basis will also help reduce the unintended "thinning out" [consequences( of past Federal sewer andwater policjr and program actions.

additional, inadvertent incentive to the abandonmentof housing and noighhorhoods in central cities. Indeed there is a dilect connection between suburban
housing being built in a metropolitan area and thefor existing housing in already developed
neighborhoods. Essentially the rate of new housing
production in each metropolitan area affects greatly
the provision of adequate housing for low-income
nouseholds. For example, a housing surplus occurs
when the rate of new construction exceeds household
The "Thinning Out" Consequences of Housing Policy formation which happened from 1970 through 1973
as housing starts soared over 10 mil ion. Since thisOver the past thirty years, naflonal ilousing goals have record production exceeded house old formatiOn`been translated into the construction of new housing. during this period, a surplus of 900,00Q units a year
Relatively little effort was given to conserve existing resulted. Most of the surplds remained in the,majority
housing stock, an'emphasis now.being altered by the of Metropolitan areas, which caused millions ofpresent Administration's housillg policy...The focus of households to "filter up" through the surplus while
past FHA/VA home mortgage programs was on'build housing vacancies "filtered down." These vacancies
ing new housing on the unbuilt developable land in became conceetrated in the oldest, most deteriorated
suburbia. Along with Federal highway and.sewer and inner city neighborhoods and have caused,acceleratwater policies, thipast F ederal hbusirifj emphasis has ing abandonment of these neighborhoods. 1 hus, the
had its noticeable part iR Jorming Alle concentric cir- operation of the housing market has contributed sigcles of racial and econoc separation that persist in- nificantly to subbrban decentralization.and inner city
many metropolitan areas: It has augmented resource dethifierat ion.
and energy intensive suburban sprawl and help-misdirected residential development therehy contributing Suburban decentralization mlght be slowed withto dir pollution, dinfinishing productive farm land and stringent growth controls by suburban communities
endangering ground water. Yet, the Housing Act of to stem the tide of new residents (and the con1949, as areended whict#called for safe arAd decent comitant proyem of higher property taxes, pollution
housing for all Americans also sought the f'detielop- a%) congestion). Also, additionel Rederal regulation;
ment of well-planned, integreted residential neighbor- could effect the capacity of the housing industry to
ds and the development and redevelopment Of satisfy rising housing derris created by, expanding/household formations. These factors mighr be. a benmmunities."
efit for central cities pind inner suburbs since suchOn the other hand, however;there has ereen a matked tiemands could be deflected toward existing housing
rise in housing quality since 1950 as mentioned ear- with the slow down of new housing production andlier. Most orthe housing built since 1.949 has been the rapid increase of its costs.
locatek in the suburbsalmost 80.percent. FOr a majority of American households, the hObsehold income gill, the rirocess of urba(i decentralization within the
devoted to housing cost has declined since 1950. This Nation's metropolitan areas will probably continue
is in spite of the rapidly escalating housing costs since for some time given the preference and satisfaction of1970 identified by the Huo Task Force,.RePortpn the majority of Americans to live in a suburban enviHousing Costs as a-nationwide problem not limitecf to ronment. Thus, it may become necessary tO develop
rPfew cities or regions. (Much of thiskicreased -cost is new pricedures by means of which new construction
due to an increase In regulations thet &Al with finenc- can be balanced against rehabilitekin not onlypt theing,. environment, land development, ti8using eon- national leVel, but wIthin'each rdf thb,'NetioR's major
strUetiOn and rehabilitation, the ptpvision of support, housing markets. It would also be imbortant to lie
ing facilities, and, a lack of developayeserviced land together more closely the metr4opolitan-wide housing
marketr,

11 4

planning with housing plans required for 'Federally
assisted housing and community developm'ent andwith the nbn-assistod Federally insured housing pro

open spa/e acquisition is the Land and Water Conser-

le housing oppor tunnies andgrams to assure equisound urban developmen patterns on a men opolitan.

since 1965 it has provided nearly $1.2 billion to acquo over 1.6 million I eder.91 acres for the Forest

wide scale,Service, National Par k Service, 1- ish and Wildlife Serv

The Lick of a Federal Recreation Policy
for Urban Areast.

vation Furld (L&WCF). Fprty percerN of .the Fund is
to be Csed by Federal lanbd management agencies andice, and Buteau_of Land Monagement. Most of theseFederal lands were acquired for the purpose of preserving natural areas of unique significance. Few Federal acquisitions, however, were near metropolitan
areas, or related direoly to the needs, nor is such cc-

The Importance of Urban Recreation in Communities The economic importance of recreation to com rcOition specifically directed by the L&WCF.
munities and cities is underscoreccin a study by the
Up to GO percent of the I= und is apportioned by Con
Rand Corporation, which concluded that policies afgrasstO the states. Since 1965, $1.5 billion in Fundfecting the quality of local amenities such as poliomoney h.as been matched against state and local funds
tion control and the provision of cultural and recreafor acquisition' of some 1.6 million acres and for thetional facilities will also affect,migration patterns oftedevelopment of recreation facilities at 141,000
houveholds and the location decisions of some employers. The study suggests that increasing the attractiveness of residen,tial areas may be more alfuring toand local parks,

new industry and commerce than simpl,y -reducing

At the state, as at the Federal level, policies for using
the Fund have not specifically been directed to meetthe needs of urban areas. 01 the teri most populous

taxes. I migoved ur ban amen it ies are not only desil able

for their own sake, to enhance the quality of lifo forcity dwellers, but may also be essential to the economic survival of cities,,

President Carter's recreatidn grant proposal submitted
to Congress in May 197(3, reflected growing recogni-

states (accounting for more thin half the Nation's
population) only one, Florida, has obligated L&WGF
money to urban areas in icroportion to the number ofpeople living there.

tion that recreation is closely tied to the quality ofurban life. This point was forcefully illustrated in theOverall, the Land and Water Conservation Fund has

18-month study of. urban recreation and open space

populated urban areas of the Nation. Per capita, morethan twice aspuch Fund assistance has gone to rural
as to urban areas; further, within metropolitan areas,
suburbs have received "twice as much monty a.s thecore-city areas. Although a greater absolute share of
total L&WCF grants has gone to urban than to rural
areas, costs of acquisition in the rural areas ate goner-

preservation undertaken by the Department of theinterior' at the direction of Congress. The study drewthese major conclusions.
There is no existing national strategy to meet yit,alurban recreational and open sNce needs.

Lac1.;,, of coordination among the FederaLstate,
anp local agencies now providing recreation decreases
the usefulness of existing progrargs...
Most .public retreation prpgrams in mosVities areft

underfianced, understaffed, limited in scopl, poorly

not provided close to-homo recreation for densely

allysmuch lower, From 1966 to1977,-only 37 percent of the acreage acquired by state and local goVernments through the L&WCF .was in inqlropolitan
areas, where mOst of the Nation's people live.

distributed, and *rye the needs of no more thansmall segments of the population..

t he study reported that indoor and outdoor recreation feoilities located close-to-home . are important
to' urban residents, and they are nOt satisfied with
-4---aatat ecists,c In all the urban neighborhoods sempled by the study 77 percent of the- residents reported dissatisbction with recreation Opportunities.
Diesa, tisaiction approached 100 percent in low in.

come neighborhoods.

The Modest Federal Aid for Urban Recreations
Needs Federal money is a potentially powerful but
still modest source of aid to urban recreation.Jhe
major Federal money for recreation development andLand and Water Conservation Fund
Average Per Capita Obligations, 't
Fiscal Years 19611(In Rural, Suburban and rban Areas)

ArOu

ND unal Total
Rural (Non-SMSA)SMSA Total
Central Cities
SuburbanPopu ation(MIllionS)

Obligations(Millions)

203.2
54.9
148.3
61.5
86,8

$1,470.7
592.7
878.1
238.8
639.3

Average
Per Capita

Obligation$ 7.24
10.79

5,92
3.88
7.36

Source: U.S. Department of Inter r, National Urban Recreation Study: Technical Reptrts, V lume 1, Urban Opv
SpaceExIstinjt ettons, Opportun ties and I ssues,-1.M8.

-IL J.

a.

4
Financially hard-pressed cities often isimply cannot af-

ford the 50 percent match required to use the Fundeffectively. with the result that the Fund generally
assists communities with matching resources, which
may not be those with the greatest open space andrecreation needs. Finally the t WC.f- is statutorily
limited to the acouisistion of open space and develop
merit of new outdoor recreaUgn resources; often,
however, the critical needs in cities aro for indoor-facilities and for rehabilitation of existing facilities.

t.

The Limitedi Impact of Community Development
Programs in Urban Policy

Most evaluationOkih* conclodod film Federal programs' intended to directly af le( t the economir andphysical development of urhan omietinitles have had
the least significant impact when ompilted to the"hiddenV poliCies implicit in Federal expenditures,
regulations, tax provisions,and construction.
.

_

Over all, lit can be said that the powers of the national

General Revenue Sharing is also an important source

gover nmont are at their most potent in influenC:ing

Of funds for local parks and recreation, providing

patterns of urban and regional development when ern
about $317 pnilli n nationwide in the 12 months end. ..ployed to influence the llow of pnvate capital oring June 30, 19 6, which is about 7 percent of all when large-scale progicts involving major Federal poiGRS expendituies. Cities of more than 1,000,000 ticipation and requiring substantial purchases ofspent th'e smallest proportion of these funds for rec- goods and services are undertaken.
reation.
4
Economic and.community development programs enThe Cornpr9honsive Employment and Training Act acted to contravene the ef fects of "hidden" policies(CET A) is playing on enportant albeit unplanned role are insufficient in magnitude to altei the ef fects ofin u ban recreation. Under the CE TA program the these larger influences.
Fede I government gives financial aid largely by formula t state end local sponsors to conduct employ- To be effective such programs). must be implemented
ment an training programs. Authorized activities in- within a context of general Federal pohcios that shareclude tra itional public service employment. In fiscal at least some common objectives and purpose. Suchyear 1976, CETA provided almost half of all ricleral coherence 'is an-essential prerequisite for affective nadollars sporkt on parks and recreation in cities and tional ueban policies.
counties. T e result has been not simply short-term. emplo4men but reliance by the larger, fiscaHytroubTed citi s on CETA-paid employees for maintenance and op ation of recreational facilities. Be-cause
untrained CE1tAen51oyees are replacing permanent

4park and recreation workers, the qiiality of maintenance and operations is suffering.

X

The Community Cievelopment Block Grant PrOgrarn(CDBG), a sreall bublic works and capital impiovement plogram administered by HUD, has also bees aprincipal source of Federal money..for urban recreation and open space since 1974, when it consolidated
seven categorical programs of Federal aid to cities,
including the pld Open Space Program. ($683 million
were obligatea for acquisition of about 50,000 acr%of land between 1961 and \4974 under the OpenSpace Program.) At present .the block grant programprovides as much Federal grant money for capital as-sistance as the L&WCF,- In fiscal year 1976 Cities andurban bounties spent $132,1 million in CDBG funds
on recreation. In fiscal year 19Z6 entitlerrient cities
sgent 7.8 percent of their CDBG program funds onrecreation; only 4 percent of this total CDBG money
was spent on recreation services.qn 'fiscal year 1977
entitlement cities spent 7,6 percent or $135,204,000of the CDBG program funds on recreation.

lip

A

a

Nh,

1

P4

A

a

;

VtoS.

r

tittrt14".11""bt

'41A

ot

S.

1. Making a National Urban Policy:
An Interagency Process.

.

A welfare !Morin proposal which, upon passage,
will provide jmniediate fiscal relief to state and local"I think we stand at a turning point in history. If, a114

hundred years from now, this Nation's experiment indemocracy has failed, I suspect that historians will
trMe that failure to our own era, when a process of' decay began in our inner cities and was allowed tospread unchecked throughout our society.

governments

A doubling of outlays foi the Section 312 housing rehabilitation loan program.
Creation ol 0 consumel koopeiative hank vvhich
would provide. financing assisliirke to k:Onsuiliel co-"But I do not believe that must happen. I believe thatworking together, we can turn the tide, stop the decay, and set in motion a process of growth thflt by

operatives which have difficulty ok)taining conven-

the end of the century can give us cities worthy of

But President Carter promised more than a series of
new policy initiatives, he promised a comprehensive
national or ban policy: Speak ing before the United,
States Conference of Mayors while still a Landidate,he promised to develop "a coherent national urban
policy that is cbnsistont, compassionate, realistic andthat, reflects the cltreenty and good sense of the American people." llo fulfill this pledge,,he acted,on March

the greatest Nation on eartn:'

Address by Jimmy Carter on Urban POlicy to theUnited States Conference on Mayors in Milwaukee,
June 29, 476.
.

President Jimmy Carter assumed office in January
1977 Committed to form new partnerships between

21, 1977 to create the Urban and Regional PolicyGroup (URPG), an interagency body, and charged itwith the responsibility for drawing up an urban ,policy for Ills Administratron.

the Federal, State and local gOvernments and between

the public and private sector for the conservation ofAmerica's communities. t arly in his Administration
he undertook a wide variety of at:00ns WI strengthen
American cities and improve the lives of those who,-,

Membership on the URPG consisted of the Secre-

live and work in them. As recouved in President'C,

Carter , sturbanr.
message to Congre'ss, ihey include.

A $2.2 billion cumulative increase over three
years in the Community Development Block Grant--,

Program, accompanied by a change in the formula toprovido more assistance to t'he older and declining.

cities.

...

A $400 million a year Urban Development Action
Grant Program providing assistance primarily to dis-.

tressed cities.

An expansion of youth arid training programs andan increase in the number of public service'employment,jobs, from 325,000 to 725,000. Expenditures
for employment odd training doubled from FY '77 to
FY '79 to over $12 billion.
- A $400 million ,private sector jobs program ineluded in the proposal to reauthorize the CETA legislation, This qtiative will encourage private businesses..

taries of the Departments of Cornmet-ce, Health, Education and Welfare, Housing and Urban Development,
Labor, Transportation and Treasury. Many other depar talents and agencies, including the Environmental .
Protection Agency, the S#ll Business Administration, the General Services AdminAration, theDepartment of Defense, and others, made irnportant

contributions to the work of the URPG. Also involved were members of the.President's Domestic Pol-icy Staff, the Office of the Vice President, the Inter-,,governmental Relations Staff, and the Office of Management and Budget. As the "urban conveyor" forthe Executi e branch, the Secretary of the Depart- .
using and Urban Development was asked
ment ofby the President to lead this interagency policy.group.

The URPG organized itself to endertake its difficult
to hire the' long-term unemployed and the dis- and unprecedented task. -Several task, forces were.
created to develop policy in particular functional
advantaged.
A sixty-five percent increase in grants provided by areas: economic development, transportation, neighthe Economic Development Administration to urban borhoods, pubk finance, redlining, employment, andV States arid regions. Frequent meetings were held in.
areaS.
which top Iministration officials collaborated for
A thirty percent increase in overall Federal assist.
once to education, including a $400 milliqn inCrease the first tim in,itt unified urban policy making process. Numerous experts within and outside of governin the Elementary and Secondary Education Act, targeted in substantial part to large city school systems ment were consulted as the, effort to define urban

with a concentration of children from low-income
families.
t;'An-economic stirrinlus package, including Anti-

ReFession Fiscal Assistance,. Local Public Works and

CETA, which provided almost $9 billion in additional
..

..--

tional financing

aid to states and cities'. -

v

4

.

1 Noblems and alternative solutions proceeded. Ideas,suggestions, and comments were eliCitea from public
and private groups, co rn. unity and minority leaders,
described in moredetail inand atademic scholars.
a .later chapter, various forums were held in each re.gion of the country, and i Federally-sponsored
.

.

-

R

meetings with top corporate, business and labor

nomic development, d) community and human (toyer

leaders wore convened to provide policy makers withopment, andfirst hand accounts -of urban problems. Numerous

policy principles and recommendations are discussed
in more detail later.

staff meetings at the White House with state and local
officials, minority community leaders, and neighborhood representativ(s provided additional contri-

butions to the national urban policy making effort.
Altogether, It is estimated that over 10,000 citizens.were involved in these consultation processes.

By the end of October 1977, the URPG produced arough draft of a document that was revised and issued

on November lb, 1977 under the title, :Cities andPeople in Distress." this document was widely re-e)equal opportunity. The URPG's

On March 15, 1978, the Secretary of Housing and
Urban Development form" presented the work of
tho Urban and Regional Policy Group to the Pres!
resentation focused upon the URPG's prodent. Th
blem analy$s, its assessment of existing programs, its
policy recorirnendbtions and its Ptoposed strategies.
On Mardi j7. 1978 President Carter preisented his
urban policy to the Nation. With its presentation, fie

moved anot er step closer to the fulfillment of his

ported upon in the mass media. ,Hundreds of copies
wale distributed for review and coinment to organiza
tions of state and local government officials, public
interest groups, civil rights groups, academics, busi-

commitmen to forge new partnerships to conserve
America's c mmunities.

'ness and labor groups and others.

Os explicit urban policy. This policy articulates sharedaspirations for the future of urban people and places.
Individuals in and out of government have a Standard against which to evaluate their actions and,On the basis of the URPG's document and the comments received, Secretary Patricia Roberts Harris andDomestic Policy Advisor Stuart Eizenstat prepared ajoint memorandum for the Presidenfsummarizjng the
URPG urban problem analysi*and its recommended
policy principles and objectives_ Pfesident 'Carter ap-proved the principles and objectives and directed the
UR PG to evaluate existing Federal Urban programs aswell as new urban initiatives for conformity withthese emerging national urbaRpolicies.

in directing the URPG to examine existing Federal-urban programs, President Carter recognized that no
amount of new urban assistance could match the already considerable sums of money being spent by theFederal government to aid ,states and localities, andso, he proposed to marshal these resources toward
the achievement of his Objectives. With the assistanceof the participating' agencies, the URPG weighed
existing programs in relation to the President Carter
evolving urbart policies and produced numerous recommendations for improving them. None of these improvements requiked new budgettiry authority; mostcan be adopted by administrative irieans, and only a

For the fi t time in its history, this country now'has

the actions of the institutions with which they areaffiliated. Voluntarily and without central direction,
they are able to blend their efforts with the efforti ofothers.who are committed to the realization of theseaspirations. Through the creation of new partnerships, they may begin to work together to realize
their aims.

The chapters that follow describe the steps taken by
the Carter Administration 10 ihvolve citizens from allparts of the Nation in the formulation of the nationah
urban policy, the tirinciples eVolved to guide urban
policy-making, and the policy objectives formulatedby the URPG along with strategies for meeting them.
The President's message to Congress outlining his
urban policy is reprinted in APbendix B. The report
cOncluctes with a brief discussion of the next steps
that must be taken now that a national urban policy
has been put forward.

few require legislative action. With he adoption ofthese improvements. Federal urban pcQgrams will be
more responsible: more efficient, mor coordinated.and more supportive of the Nation's urba areas.
.f

The URPG also considered numerous new rban program initiatives submitted by the paCcipating
agendes for inclusion in the President's urba policy

These new initiatives fell into five policy'lackclusters: a) coordination, simplification and reorientation of Federal, state arid local government activities, b) fiscal assistance, cf employment and eco-

11 9

2. Making of National Ur Imn Policy:
An Open Dialogue"<

116

Development of the President's national urban policy
followed an open policy-making process. Numerous
ideas, suggestions and comments were elicitedthrough a variety of forums, meetings and surveys.
While all specific suggestions made during this dia
logue cannot be reflected here, k AS possible to sum
inarize stme of the conclusions arising out of these
discussions.

Dialogue With Citions Ten two-day hearing andworkshop sessions were held in May and June 1977 in

Boston, New York, Philadelphia, Atlanta, Chicago,
Dallas, Kansas City, Denver', San Francisco, andSeattle. Top officials of the Administration heard theviews of 400 participants and some comments from2000 others whO.attended the open sessions. In addi .

tion three special forums were held in early 1978
,with a broad spectrum of "equity" group representatives, that is, racial minorities, women, the aged, thehandicapped, representativeS of ethnic neighborhoods
arid the urban poor.
Several common themes emerged.

The level of citizen and community frustration
over the management of Federal programs is high.
Coherence, flexibilitY, the abilityto tailor Federal aid
to specific community needs, and a reduction in.-redtape and needless regulations were persistently urgedin every forum.
Federal assistance to communities must acquire
greeter hurdan sensitivity and be more responsive tothe special role of neighborhoods in makipgsuccess-fur' communities. Human dignity and self-respectshould not be cold-shouldered by aseptic Wograms
that have little human relevance at the corern'Tnity'level.

I

There was a strong belief that the declining cern-that consumes agricultural land and imposes special
burdens on local governments.

cjn Texas, the Rocky Mountain States, and theorthwest, the construction of "boom towns" ip
connection with energy and resource developmentls
a special concern of state and local governments.
They asked for some recognition of this special problem in Federal urban policy.
A new and stronger emphasis upon urban economic development was pressed by a wide spectrm
of participants bankers, neighborhood representa
lives, state and local officials, business groups, andnonprofit organizations. A Newar k of f icial insisted

that urban priorities are presented "inverted" aridthat top priority must be assigned to job develop
ment, a view supported by the Chairperson If theHarlem/East Harlem Policy Committee and many ofthe equity forum participants.
There nas some consensus that national urban
policy should emphasize urban conservation over new
construction. 1 his was especially recognized in theequity forums in Sari Franckco and Chicago withthe displacement issue strongly underscored,
And there was a growing call for new partnerships

between the private and public sectors to attack awide range of urban problems.

Citizen Interviewu During the summer arid fall of
1977, a series of interviews with nearly 1800 community, state, business, labor, and civic leaders ineach of the country's major regions sponsored by the
Department of Housing and Urban Development andthe Department of Commerce fOirnd similar sentiments:

Throughout the country, the era of high antagonism between business, labor government and community organizatiOns appears td be ending. There is a

growing movement- toward cooperation on corncities must be revitalized. Participants in 'the . munity problems.emong these sectors and they take a
Atlanta Citizen Forum pointed out that many wide variety of forms.
southern cities are suffering from problems Of decline
Perhaps in response to the difficulties of two
in their central areas. Participants in the Wesi and back-to-back recessions, the stress upon economicralSouthwest agreed, but urged that the special problems and pressures in rapidly-growing areas .must
also be recognized.

The representatives of the disadvantaged called
for expanded equity and choice and a greater businessparticipation for minorities and women in all
federally supported programs.

Many, representatives from smaller cities urgedthat national urban policy recognie:- the ,.specialdifficulties they confront, whether growing or
declining, abruptly vulnerable to change. They wereconcerned with the so-called "urban shadow"thesprawl 'of scattered housing and commercial
develOpment in rural areas beyond the urban fringe

development as Xop priority in urban development
was far greater .14lan it might hal been in the 1960s.
Because of the considerable variations in community and regional problems from one section of
the country-to anpther, there wes_a widespread gonvictio`n that national urban policies must_ prdvide
mechanisms by means of which that diversity can berecognized. There is fear of any attempt to definemonolithic or standardized approaches to urban andregional problems when, in fact, they are quite different from area to area.

Because of slower economic growth rates andrising costs, public programs must now be more carefully targeted on specific objectives. The management

of the public sector must be greatly improved to meetthe merging needs in each section" of the, count'And there should be an at tempt to use publit. in st
rric4its so that they "leverage" increased private ri-

vestment in urban communities.
Counter-cyclical tiaining programs should be replaced with programs designed to got the structurally
unemployed intb mainstream, permanent jobs,
More emphasis must be placed on the upkeep end-renova\-Lon of existing urban investment which, inmany stions of the country, is deteriorating rapidly
and reinforcing private disinvestme4.
Some communities are now stymied by stand-of I
conflicts between their environmental, social, andeconomic objectives. We need to decide how to decide. Some portion of urban arid regional decline istraceable

to political inaction deriving from thesestalemates. New mechanisms, short of the courts, are.necessary to reconcile these conflicts as quickly as
possible in each area of the country.

The Corporate Voice Certainly, decisions made bybusinesses and tor porations'havedo profound impact

upon the urban condition. 1-o gain insigtit irito thedeterminants of these decisions, urban policy planners.made an effort to reach out to the corporate andbusiness community. 1 hrough surveys, interviews,
and corporate for urns held in four cities, they elicitedthe views of more than 200 corporate leaders onnational urban policy issues; These leaders represented a wide range of businesks and industries in allparts of the country. Despite their diversity, however,.
they agreed on many key points.
Specif
The corporate participants cautioned against
addressing ur ban growth and development issues witha programmatic, piecemeal approach. Instead, theyurged the creation of a coMprehensive irrban policy
and an ongoing coordination process.

They advocated the continuation and expansionof the dialogue between the public and private sectors
regarding urban issues.

They believed that an expanded downtown business economy, based on the servjce and knowledge
industries,

cou,ldgenerate*

They urged removal of Federal incentives forurban decentralization and sprawl- development andstt engt herring of incentives for the kinds Of ofhPloy
menl, housing and amenities needed for urban
economic reLover y.

Duringthe fall of 1977, a series of state and region'al White
1-louse Conferences were held throughout the country
State and Regional White House Conferencesasa prelude to the White House Conference on

Balanced GrOwth and EcOnornic Developmenttri

Washington. D.C. in January 1978.

While findings in these dehher ations 'were many (Inddiverse, the states produced some common views
usetul in considering a future framework for national
urban policy:
The states do not see any peed for the Federal
government to assume-responsibility for fashioning aformal national growth r2olicy. Asserting that private
investment decisions essentially determine the patterns ol national growth, the states did ret.ogni/e,
however the critical role that Federal and state
actions-play in influencing the extent and location ofprivate business activity and job opportunity. They
therefore s6l1 for new forms of Federal-state partnership in exercising their separate powers cooperalively as they af fect growth and development in Iny
par ticulm par t of the country.
The states complain aliout Federal inflexibility,
sudden policy shifts, overly-detailed administrative
arrangements, weak or nonexistent data underpinning
Fedefal decisions, end program duplication.
By and large, the states argue for "neutrality" illFederal poli.cies that af feet investment decisions, butwhen long,term trends result in growth or decline,
they strongly favor some forms of Federal involve
rnent to mitigate the impacts private sector decisions.
They argue that stresses caused by unbalanced economic activity are widely apparent in declining central cities and rural counties as well as rapidly growing
small towns and energy bqom towns. Regardless ofthe cause, the resulting imbalance in public services
and facilities outstrips the fiscal capacity and economic base of the af fected units of government.

the new employment

public education system which they linked withAmong specific proposals ad4anced by the states as aresult of these conferenCes are:That Federal--expenditures_ShoOld be weighed ie
terms of their geographic impacts and shauld reflectnational development priorities.

unemployment, crime and urban.deterioration,
They strongly suppbrted a metropolitan-regional
approach to the future.of America's-cities. A regionalview was essential, they a.rgued, if the problems Of
rapid growth were to be treated as seriously as thoseof rapid decline,

facilities and public works project.s s ould bethoroughly evaluated before final decisioSs on location are made,That private .firms should be closely involved in
the development of job training programs.

Federalopportunities that central cities require if
government leveraged .the necessary private invest-

ment.

.

.

They expressed tieep concern for the failUre of theThat the growth 'potential of new go ernment

That access to wital, possibly through a Revelopment Bank, should support long-term financing forinfrastructure and economic development pi ograms.
That states should seek meanstfor shoring the118

state-wide tax base equitably._That the Federal government should enhancecooperation among levels of government, using existing structeres 'and mechanisms and possibly offe[irig incentives.

1 hat multistate commissions should be Itrenithoned to deal with regional economic probleeis such asenergy, transportation, and agriculture.

White House Conference In late jOnuary 1978 theWhite House Conference on ,Balanced NationalaGrowth and Economic Development brought together over 500 citizens from all sectors of American
society to debate, discuss and,arr ive at conclUsions on
the growth and development issues facing the Nation.

Conference participants acknowledged the needand ef forts to distressed areas
to target Federal(and groups of people) regardless of regional or
urban-rural characteristics., In particular, therm was
support for targeting to inhor sections of hies, older
towns, distressed rural areas, and areas impacted by
rapid growth.
They also acknowledged that Federal policies need

10 give -vreater recognition to the diversity which
exists among areas of the country and local economies.

A

They recognized the needlit r decentralization ofdecision-making and administrative control over federally-funded programs. The Federal government wasurged to move towards a system of greater local discretkan and eyaluation through performance standards lather than centralized decision-nmking .end
lengthy application procedures.
They also recognized a heed for increased slater-esponsibility for the fiscal problems of their localities, for the economic development concer ns of dis
tressed areas, and for a more active role in growth
thisnational
town
delegates and participants in

1 he 1978 National Urban Policy R.eport was purposely delayed in order to obtain the views of the

management

meeting.

DesPite pe div*lty of the participants, several
dominant themes emerged frorn their discussions.

The participants emphasized the overwhelMing
full employment, boththrough macroeconomic ,policy -and through sub.
national programs. targeted to alleviate structural
importanCe of achieving

unemployment.
They also underscored the role and importance ofthe' priVate sector as...the predominant source of new

employment opportunties and the need to bring theprivate sector into a creative and cooperative partriership with Federal', state and local governments in efforts to achieve national. objectives, and particularly
the full employment objective.
The participants gave high priority to measures tO
invigorate local economies through incentiyes to in-duce private sectOr economic activity in distressed.
areas.

They expressed Wine support for public policy
efforts to reverse basic economic and demographic
trends; yet, they also frequently endorsed the viewthat public policy should be oriented to stimulating
job opportunities in areas where people currently
reside rather than encouraging inmigration of workli;

They emphasized the need to improve the structure and operations of state and lOcal govprnment,
including the desirability of areawide cooperationand tax-base sharing in metropolitan arid rural, areasand "the development ,of multi-state regional institutions which permit public and private sector representatives to devise regional .strategies.

They made very few recommendations for substantial-expenditure of additional Federal monies tosupport growth and devu1prrient activities; but instead recommended reass ment among levels ofgovernmeni ..of the responsibi 'ty for financing various
functions .(greater Federal responsibility for welfare
and Medicaid, greater state responsibility for educetion). However, it should be noted that these reaSsignment reciammehdatiöns would entail signficant Increases in Federal outlays.

The participants expressed a pervasive sense of
dismay arid frustration directed at the insensitivity ofFederal regulations and prevalence of red tape.'

Finally, they recogniidd that existing national
policy processes are not adequate to meet the growthand development challenges the country faces andthat improved processes, perhaps in the form, pf
national growitii policy process, will be required. Sucha process-should involVe all Ievels of gorernment andto areaS of reater job availability,
The r eiling sentiment of the conference was include citizen input. It should result in clarification,
that-we are one Nation and that political fragmenta- of national goals; better forecasting and projection
tion which piays off interests of different geo- capabilities to enable the Nation to anticipate prographical Sectors. (e.g., sunbelt vs. frostbelt; urban vs. -blems; irttroved analysis of policy alternatives; betterrural) is detrimental to the ecoinomic welfare of the policy coordinatjonxvithin and among leYels Of government; more seativity and rational trade:Offs
country as a whole.

pj.

3. Principles for a nalanced Urban Policy

among multiple objectives and programs, and integretion of policy and pMgram evaluation more centrally
into the policy process. -Thd National :Uilmn, Policy and New Corrimunity
Development Act calls (Or a national urban policy

Reports, Incorporated, was made available to 'dele-that among other objectives will "encourage,the wiseand balanced Use of physical and !lumen relources inmetropolitan and urban regipns as well as in smaller..'.
places." T he challenge fpr a national urban policy is
to achieve' balance among strongly held and sometimes conflicting national objectives. These objectives

gates at the White House Conference, The P'oll raliged

include:over a large number of issues relevant to the Conference, but it did find a majority of those interviewed-63 percentsupported Federal job aid toplaces where people are unemployed, while only 20
percent felt that the Federal government should en-

Econbrnic growth which provides opportUnitles
for employment and an adequate standard of living
for all Americins,

everal polls were commissioned

Nationwide Pollsof Americans about theirto ascertain the fcommunities. One independent poll by Cambridge

courage unemployed people to move to places wherejobs were more readily available (and 17 percent reS,
ponded "don't know"). It also found that 48 perCent
supported encouraging people and iodustry to locate
in large; declining central cities while 28 percent were

opposed (and 24 percent responded "don't koow").

Equity or fairness in acces 'to the benefits ofgrowth and development for all citizens and areas,
within the Nation;
Protecting envirOnmental tjualitY;

Conservation and judicious use of,otiysical andhuman resources; andEfficient and responsive government and a-strong
and involved private sector.
In seeking balance among thew objectives, the nation-

urban policy put forward by thp Carter Administration observes the following principles:

4.6.-'1, National urban policy must ba, developed within
the context of the basic 'population and economic
trends 'affecting urban' areas and recognize thatdecline In population densities In the,filation's urban
criers will continue and cannot be easily reversed.
This repott identifies a number, of major population

trends including the dramatic slow down in the
Nation's overall population growth rate since 1950,-

the population migration from the Northeast and..
Midwest to parts of the south and west, the declinb in
metroyolitan* areas compared to new metropolitan
areas, the rapid increase in the number of households,
the continuing racial segregation in nearly all metropolAah areas, the phenomenon of an emerging older
U.S. population and-the preference of the majority ofAmerrcans -to live ih a low density sUburban,.

environment. On the economic side the Report
identifies:the decentralization of manUfacturing tosuburbia and rural areas exaterbating unemployment
among the unskilled workers living in low income city,neighborhoods:*

2. National urban pgiicy must recognize tha .ythi
trench and urban policies ham improved the qualityof 'life foi-ithe malotity of Americans but not theminorities of brban residenti trapped in poverty
4

thtl. Nation has risen since., The housing qt.mility
110. Fpr a mejoOry of houieholds there'has been a..
r9
go
.

--

II

decklaso inthe percentage of household income

devoted to housing costs..Over the past three decades
there has been a rlsetin real incomes to help raise theStandard of living of most residents of metropolitan
ar eas. This has enabled the massive growth of 1 elative-

ly low-donsity suburbs which have played a key partin upgrading housing neighborhoods and oilier falities. At the same time, social and economic cost ha ebeen imposed on the minority of people concentrated

in poverty areas. This minority experiertes more
unemployment, more street crime, inferior publicschools and less desirable neighborhoods than the
majority of Americans.

national urban policy makes it less likely that thoseactions will work at cross-purposes with one another.
A national urban policy must be comprehensive because ur ban problems and their solutions ale interrelated. Some problemslike decaying buildings andoutdated water and sower systemsare ploblems ofplaces. Otfiery---like unemployment and poverty areproblems of people. Cities with deteriorating physicalfacilities will have difficulty attracting the investment
needed to create new 'ornployment opportunities. A
coMprehensive policy makes it possible to address
both simultantrously -for example, by linking job
problems with community development activities.

.3. National urban policy must mflect the diversity of
5. National (Alban policy must present a carefully
Amen* cities and their pmblems.
adiculated set of priorities.
American cities are characterized 6y diversity. While
cities share' many common problems, each city is While the Federal government can undertake actidn
unique. Cities- differ from one another in their social, on many fronts simultaneously, its actions must be
economic and physical characteristics and in the guided by a clear set of priorities. Mor resourcelf
ran0 and..in tensity of their problems. I3ecause.each must be devoted to the problems of people and places
Gity is uriique and not all ciffes share the same prob- in the greatest need. To Stretch available Federal relems, a national urban policy must offer programs sources, priority must be given to those expendituresthat leverage the maximuni arnounts of additional
tailored to a variety of circumstances.
public and private sector resources.

Some cities are experiencing rapid growth, somestability, and some decline. Growing aties may need ..t3ecause conditions change, a national urban policy
assistance in managiTig growth and development, pre- must be subjected to continuous review, so that
serving -open space, and assuring equal opporlunities changes.,or/ modifications can be made as reqUired.
to %It who wish to reside in thet: Staple cities may Prioritiesl mus) be applied to existing as well as new
neerfassistance in preserving their assets and warding programs, so that the total, Federal inventory ofoff .the possibility of decline with age. Declining cities urban programs reflects'national policy objectives,
may need assistance in revitalizing their economies
and.adapting to their changing economic functions. It 6: National urban policy must reflect the Commitshould be the aim of a national urban policy to assist ment of the Federal government to play a central
cities and suburbs in meeting the respective needs of role.
-their jurisdictions.
Over the past three decades or st;), our view of the
4. 'National urban policy . must 'reflect acompre- Federal system has changed. Now),tbat many of thesoCial and economic problems that cities face origi---, -hensive set-of Federal commitments.
nate outside Of their own boundaries, urban problems
Because cities in different circumstances face dif- have become national problems; and the Federal govferent problems, a national urban policy must be ernment's responsibility for helping cities and theircomprehensive, It must deal with the problems asso.c1,- needy residents is no longer questioned. Increasingly,
ated with urban growth, Stability and decline; it must the Federal government has assumed the responsibility for defining national objectives and Provklingdeal with the problems of peonle as well as placeVthti resources necessary to'carry them out, Debate
A natlOnal urban policy can be coMprehensive, be- focUses. upon 'Vvhat national objectives- should be,cause the range of Federal responsibilities is very. what strategies should be used to achieve them, what
broad_and Ve Federal gOvernment is organized 'to ground rules should goyern the use of Federal aid,
address diffeienl problems at the same time. Whirr and vhow relationships among levels of goverri'mo4nt
one. Federal agency addresses the_ problems of urban should be structured. If it is to provide the necessary
direction, a'natiorfal urban policy must address these, education, another concerns itself with inadequate
housing: and another, obsolete transportation facil- Concerns.
9Ries. By providing a glear statement of objectives, a
*
P

r

.

10. National urban policy alust reflect the potenti-

7. National urban policy must reflect the involvement of state and Meal governments during every

ally significant role of .the neighborhood in thyphase of its formation and implementation.

building and rebuilding efforts.

(Despite the irepot lance of the Federal role in urban
policy, it is clear that urban problems were., notcreated, nor can they be solved, by Washington alone.
State constitutions and statutes govern local government structure, boundaries, taxes, hnd land use. Manystates now supply cities with largo amountS of direct
and indirect aid. Encouraging increased state Involvement in finding solutions to urban problems is
dRsential to the success of a national urban policy.

"Many neighborhood groups around the country havebegun successful, innovative community planving andneighborhood revitalization activities. 1 tiN." trend
shoyld be encouraged by the Federal goyorm9ont.
Neighborhood residents and proups are the ones.of-fected most directly by revitalization efforts. They
are closest to some of the problenis and often best
able to judge-what solutions will be most efitctive.
No urban policy can succeed if It ignores the views ofneighborhood people and groups and if it does notsecure their continuous inyolvement in varied neighborhood improvement efforts.

Because cities diffef depending upon their location,
size., age, and population mix, local officials rather
than state or Federal of ficials must be relied upon to
identify local needs and priorities. Local government
officials are increasingly, responsible for the sopnd
and responsive administraijon of many national pro
grarfi They are also trAiquently responsible for as !
lot local citizens have ample opportunities tosurin
influehow those programs are administered. Without the commitment and cooperation of local government officials and involved citizens., no effective)V.\national urban pOlicY is possible.

8. National urban policy must reflect the need totrengthen substate, regional and metropolitan instiItions.

.,

Many problems fpced by older central cities andnewer suburbs lo not end at their boundary lines.
Yet, we have only begun to develop institutions that
can

deal

with. Metropolitan, substdte or regional

issues. For urban policy to succeed, institutions able
to cope with areawide problems must be developedand strengthened.

9. National urban policy must refltket a strong and'the public and priaffirmative partnership bet
vate lector_

F.ederal:Itate arid local funds, no matter how plentiful? will not he enough to solve our urban problems.
The private sector must help. Only it can provide' thecapital needed for rebuilding and growing; Ohly it can
carry out the large scale development prolifalpecessary to provide healthy local etonornies. 'We must carefully plan the total rangestf Federal,state and local actions in.order to secure the mosteffective participalion of the.private sector. We cannd longer oVford to have economic subsidy prOgrams.and tax laws working at cross purposes. Urban policy

must provide incentives to influence business decisions In the direction of our urban goals.
,3C

Th
4_

125

4, The President's Urban POlie- y4txpanding and improving social and health sent
Urban 06licy entitled "A 14, Partnership tO Con- ices to disadvantaged pooplein cities, countres andserve America'S Communities" which was based ork, other communities.
Improving the urban physical environmen1 andtje inputof the URPG and the open debate described

On Merck, 27, 1978 President Carter Onnounedd an

122.

the cultural and aesthetic aspects of urban life.

ailier. It was the first time a President had arti-

culated a comprehensive set of policies to guide ['moral action's and programs for urban AMOI Ica. I t meetsthe challenge for a national urban policy mandated

URBAN POLICY OBJECTIVE NO. 1

by the National Urban Policy and New Community
Act, as amended in 1977,

The Urban Policy calls for a New Partnership which
recognizes Federal respohsibility and leadership for
helping urban areas inclirding cities, counties andother comhtunities. Just as importantly, it calls forthe combined effort and resources of all levels of governments, for private sector, and neighborhood andvoluntary organizations to conserve and strengthen
the Nation's communities.
5 resources to
urOan needs; for local governments it in Ives streamlining and coordinating their delivery of resources; forthe private sector it explicitly implies using all governraegatal resoufcis as a lever to encourage the private
Fokrstates this entitils redirecting

sector to 'Invest in the slrengthening, and conserving ofAmerica's communities; and at the neighborhood
level- itr involyes actively enga'ging citizens in the revitalization of their communities.

The "New Partnerships" Urban Polity is wide ranging in scooe. It also recognizes the need to conserveand strengThen the existing urban environment ofcommunities, especially given an age of increasin'g
scarcity and decreasing resources, It consists of an
integrated set of objectives or commitments tourban Arwrica.

Encourage and 'Support Efforts to Improve Local
Planning and Management Capcity, and_the Effective-

ness of Existing Federal Programs by Coordinating
These Programs, Simplifying Planning Requirements,
Reorienting Resources, and Reducing Paperwork.
Policy Statement:

In recent years, many cities, evenihe most troubled,
have improved their managemribt. and planningcapabilities. But many mayors and city ravagers saythat they still hava a long way to go Vore they canestablish comprehensive policies linking economic
and community developf-nent matters with social serv
ice and environmental concerns,

Cities need help if ,They are to improve their capacity
to understand their needs and devise fair and efficientsolutions to Their problems; and the Federal government should provide funds for the supplemental
management, planning and technical assistance thatthey require. For all cities, the Federal government
should encourage development of comprehensive
policies and strategies for dealing with economic,
community development, fiscal, social service and environmentar needs. In 'addition, the Federal govern-

ment should improve the management capacity of
local governments by strengthening city hall's coordinative role regarding Federal aid used inside city
borders,v

I. ;These policy cbjectives include:

Encouraging and supporting effort to improve Strategies for IMplementation 'The Administration

local planning and management capacity and existingFederal programs.
Encouraging states to become partners in assisting
urban aref s (i.e., cities, counties and other communities).
Stimulating greater involvement by neighborhoodand voluntary associations.

ld

Providing fiscal -relief to the most hard-preswill consider the following steps:
Simplifying planning requirements and providing
more flexibly tailored plann g aid.
Consolidating overlap lig authority for technicalassistance.

Channelling Federal ssistance to cities that prepare comprehensive plan
Assisting city hall tb aftrdinate use of Federal

progrrs within its boundaries.

_ com mu n ities.

Pro\tiding strong incentives to attract private investment to distressed commuoities.
Providing employment opportunities, pritrily inthe private sectpr, to the long-term I

anddisadvantaged in urban areas,
to opporpIoity for those disk
Increasin9
advantaged by a istory of discri nation.

Policy Statemont:

Many past Federal urban programs have not.met expectations and funds have not always been spent as
efficiently as possible. Coordinating among government*agencies in administering urban programs has

126

e

boon more a hope then a reality. Federal highway
programs, purchasino pblicies and tax incentives haveoften undercut programs designed to promotehealthy urban environments.

Our ability to help cities depends in lei ge measure on
ability to coirect these past weaknessas. it is es .

that we manage existing Federal programs
more effectively than in the past. Further, we must
'make suro that Federal actions affecting cities are
aimed at consistent objectives. The Federal government must develop the capacity to evaluate the impact on chies of all key Federal actions (including
those not directly related to cities), The Federal dovernrnent must be willing to amend, change or aVilishsegovernment

actions not consistent with notional

urban policy.

In addition. -suture actions must 10 measureii carefully in terms of their impacts- on urban areas andurban problems. All government actions should be

evaluated ahead of time with respect to possible
urban impacts and, to the extent possible, be shaped
and carried out in a manner consistent with an overall
urban policy.

Strategies. for Implementation To improve the administration ot Federal urban programs, the WhiteHouse can play a major role. It will:
Arrange' frequent meetings or sonior officials andstaff m mberrrom agencies involved in urban policy
icy effectiveneA
to evalua
When ne,pessary, dive the involved agencies theassure a coordinated response fo urban
directiOn
policies;

Cont uously monitor efforts of the various

agencies o carry,out urban policies;
Con nuously evaluate major agency actions be-fore they are carried out to aSsure that, where poSsible, such actions support urban policies;
Review end, if necessary, change programs to
make sure they remain consistent with statutory oblectives and urban policies.

URBAN POLICY OBJECTIVE NO. 2

EncOurage States to Become Partners in Assisting
Urban Areas*

Policy Statement:

States are of ten in the best/ position to solve some of
our urban problems. F Isar! and social problems re-suiting frorre'political fragmentation in urban areas
can be resolved only in the statehouse. Only there canmunicipitl responsibilities be brought more in lige

123with revoeues..Only on the state level con now regional and metropolitan approaches be created forproviding and financing services.
.0frk

es
States must pley an important part if urban lilrirt
ore to be successful, and the Federal govershould grant the states a major role in defining andcarrying out notional4urban policy.

Strategies for Implementation Each slate is different. Institutions laws and problems differ fromstate to state, so not all will be able to respond immediately to the call for cOoperation with the Federal

government in impltimenting urban policy. Illyvertheless, Federal incentives should be offered to encourage stotes able to participate in urban policy' to
do sc* At a minimum., the Federal dovernment sixfold
provide states willing to devblop,and carry out urban

policy flexible supplemental funds to implement),A

urban programs.

In -exchange for this Federal aid, states would carryout-policies to help distressed cities respond to pressing fiscal and economic protilqms. They would also
ossist such cities initiate lonedrm economic developpent strategies.
.149

URBAN POLICY' BJECTIVE NO. 3 ,Stimulate Great r Involvement by Neighborhood Organimtions and Voluntary Associations
Policy Statement:,-.,

National urban policy must be sensitive to the fundamental social ties that bind human communities together by placing illear new emphasis on the restdration of a sense of community th ugh the reinforcement, and preservation ofsneighb rhoods,
.

.

.

t

-

Neighborhood and voluntarY groups have alreadybegun impressive efforts to renew their communities In many parts of the c'buntry. Despite lackof funds and, at times,,lack of support from out-side the community, neigribortiood-based, revitalization activities have shown signs of success.

.

*'

The Federal government should helP strengthen and,expand neighborhood and voluntary group efforts at
self-help. It should encourage cities to grant noighbOrhood and voluntary groups thecipportunity to participate in .Piiirng and- iinpfam-efifing cornmaniTyoriented prograigs. It should also encourage cities to

use the knowledge and energy of ptighborhood
volunteers and the expertise of neighaThood groupleaders and staff.

4

l'

124

both popula on loss and high rates of unemploy-ment, with the coneurronce of local city officials,.will provide funds to neighborhood groups. The

ment, both pr ie symptoms of distress,

money would be used to:

The Federal Government will act to as:st cornMv-

Provide support for pilot projects aimed atildeni
onstrating new techniques for renewing neighbor-hities with those problems. I Inlp must be provided toconserve and strengthen coniniunity economic bases
and to promote the olderly and healthy evolution ofurban kononlies so that they vncompass diverse andhoods or delivering services.

balanced inf strial, business and commercial func-

Provide supPort for well-managed Community
Development Corporations.

tions.

Provide citizen training plograms for spti,dic
projects.

.

t(Strategies for Implementation The Federal govern-

1for Implementation With appropriate
help, some distressed cities may bo Ole to secure

Strategies

URBAN POLICY OBJECTIVE NO_ 4

large numbers of now businesses or industries. Others

Provide Fiscal Relief to the Most Hard Pressed Cornmugities\

will not.
TheFederal government's immediate efforts thould'Policy Statement:

Cities in grave fiscal straits nust get)be fiscal support
they need immediately. Delay in responding to theirneeds will make their problems worse. 1 he Federal

government, workingewith state and local govern-

help troubled cities: (1) retain existing businesses andindustries; (2) stimulate the expansion of existing
firms; (3) increase business opportunities for local
businesses and firms; (4) expand business opportunities for local residents; arid (5) where feasible,
compete on a more °our basis for newer-firms.

ments, should take steps to strengthen the fiscal vital-

ity of cities. In this context, reform of the intergovernmental aid system is essential. Duties andfunding responsibilities of each level of government

In general, Federal aid,would be Premised on carefully prepared local economic development strategies.
These plans should:-

should be critically examined and changes should be
made, where necessary and feasible, to close the current gap between city needs and city -resources.

Ref ct an understanding of the needs of existingarid pros ctive finns and the markets for different

Strategies .fOr Implertientation Efforts to help distressed cities respond 'to their immediate fiscal problems should include:
Increased tie-Doting of .block grent and countercycncal aids on communities and peo4le needing immediate help.
Development of coordinated Federal, state andlocal pleas for financiel aid.
Revision of Federal and state responsibil ies forfinancing public services to reduce unfai fiscal

grade public infrastructure, and, in geneial, to createa More positive environment for private enterprise;burdens on distressed-cOrnwunities.

URBAN POLICY OBJECTIVE NO. 5

Amending the Federal tax ,code to eliminate incentives that foster decentralization and to proxide
incentiiies that foster business location or expansion

itrovide for Strong Incentives to Attract Private In4stment tODIstrousd Communfties

in older urban areas.
Tafgeting exissting Federal assistance programs 'forecorkomic development on communities facingkseveretypes of business;

Reflect city commitments to maintain and up-

\s,

.*

Policy Statement:
In a dynamic' 'economy urban areas will always
change. Some cities will lose people and firms Alleothers will gain. The health of urban economies is not
so much a function of the level of population Or emN...,...../ployrilent as It is of retaining a reasonable balance

between the two. Unfortunately, many Cities havebeen unable to maintajn such a bWlance. They face

and,Reflect apprecia on r the need to inFrease job
opportunities for the chron ically unemployedtprough the inducement of major new, private investment and the nplementation of targeted job programs.

Specific Federal strategik for distri:Ted dties irklude:

economic distress. In particular; tax-exempt industrial
revenue bonds lahould be available for finandng investments only irf such distressed communities.
Modifying Federal spending for goods and serv-

ices jo help businesses in troubled- cafes survive and--.expand their operations.

Providing new financing incentives to influence
the..private sector to invest in distressed cities. These

incentives could comprise both flexible glints and

1 28

(

p.

low-cost, -long-term credit for tRAiness invostmq4s in
distressed common it les.

Coordinate and target assistance to help minor ity
firms and businessmen and women.

125

Coordinating environmental improvement programs with community, development and economic- URBAN F/90EY OBJECTIVE NO. 7.
assistance aids.

Providing more Federal support to local governrnont initiated economic development activities in dis

Increase Access to Opportunity for Those Disadvantaged by a History of Discrimination

tressed, ci t

I ncreasiog minority participation in}the ethnomic Policy Statement:.developmentV,of cities and neighborKoods throughmore effective encouragement of minority enterwises.

URBAN POLICY OBJECTIVE NO. 6

Provide Employment Opportunities, Primarily in the
Private Sector, to the Long-term. Unemployed end
Disadvantaged in Urban Areas

Policy Statement:

Major progre ha& been made in ending overt dis-'
crimination in this country. But more subtle kinds ofthe progress-of minorities. Public andracism impe
discrimination still limits minority
private sec
housing, jo neighborhood and community services
choices.

The Federal government must play a lead role ineliminating racism. It should use the full legal andfinancial powers of the Federal government to thisend.

National urban policy faces no greater problem thanthat of providing jobs for millions of jobless men and 'Strategies for Implementation The Federal govern-,
women isolated in urban areas. In the absence of con-. ment qiou Id initiate several anti-racism strategies:
certed innovative and effective Federal actions, the 1. The White House and Congress must continue t2
racism and take the lead in educat,tspeak out age
most optimistic projections indicate that unemployracism's economic, social andment among mlnorhies and the poor will temaintigh ing the public
for years.

physical costs.

The Feder g overnment will asses current Federal
mg and job creatioh efforts and monitor recent program changes aimed at increasing assistanceto t4e long-term unemPloyed. Also, it will forge
new partnerships with the private sector to open Lip

strengthen onforce&1Ai of current equal opportunity
and affirmative action laws.

/. The Federal go(hnënt will tear steps . to3. The Federal government will enforce stronger
equal opportunity And affirmative' action guidelines\
government current Federel aid programs.

permanent jobs for those now out of work. At thesame time, it should acknowledge and meet the needfor Public service job creation efforts.
Strategies for Implementatibny Specific straterVes forincreasing job mobility include:

Expand use pf private' Sector trbining subsVti
and similar means to Increase the number of jobs
available to the chronically unemployed, regardless oflocation.

Increase j1!1) opir?unities for the unemployed inneighborhood reitalizietion andprivate sqct

housing re6abilitat ionAtforis,
Target 'Current *-vernment job iraining aild job
creation programs to those post in need,Day lop irdproved transportation acc s tp "decentral iz

URBAN POLIO' OBJECTI1 AO. 8
Exipand and Improve:Social and Health Services to
Disedventoged People in Cities. Counties and Other
Communities

Policy Statement:'Social service delivery systems in many shies andcommunities fail tesls related to quality, equity

efficiency and accessilDility. Many communities arefacing escalating solial and health services demands
from an increasing .number of less advantaged residents and neighborhood groups. Yet there are insufficient resources to meet thistiemand.

jobs.

Deve op better informatiOn co1leoing and -ths-- Strategies for Implementation The -Federal govern-semination technigies concerning available jobs.

ment will act to improve, u.14-tend and expand federal

Peride increased opportunities frit- unemployedwerk#s from high unemployment areas to migrate tojobs in tow unehttloyment amts.

assistance te cit leN, counties and other com mu Aitties by,thcollowing:

12,9

I.

126

should also be taken in healthier citios to prevent
blight and environmental deterioration and expand
housing and neighbokood choices fortheir low in-

1. Provide for a strengthened and more comprehensive health-delivery system to communities lacking inbasic health care delivery and resources.
2. Improve health cahe through more comprehensive,
less costly prirnary care service to underserved urban
residents.
3. I ntegtate educational and human services intlocal
communities.

4. Provide steps andassistanc,come and minofity nvleil and women.

Strategies. for Implementation Carrying Out lc:immunity c-development policy will require sOeral
strategi s. The Federal government will.
Re uire cities to eliminate legal or quasi legal re-to improve corn-strictions on housing opportunities for low income

munity street safety.
6. Provide social services that are m re responsive tothe need of the community residents and that contribute to neighborhood revitalization.

iand minority groups.
Ask cities to develop comprehensive community
development and housing policies and channel increased Federal aid to those that do,
Support the development by urban localities ofcomprehAsive metropolitan development strategies
aimed at eliminating sprawl and revitalizing central

bRBAN POLICY OBJECTIVE NO. 9

Improve the Urbmi Physical Environment and the
Cultural and Aesthe\tic Aspects of Urban Life end

cities.

Use transportation as an incentive program to

Reduce Urban Sprawl\

private urban revitalization activities and make urb n transportation programs more
effective tools to ac omplish improved transportation
and broad economic environmental and social gbals.
Target expanded Icommunity development aid lo
distressed cities a d distressed neighborhoods.
housing obportunities for lOW,
Provide expaqd
income households in bothenoderatp and rnia"
leverage public an

Policy Statement:
Then; are no quids cures to the severe community
develdPment, community service and housing problems faced by distressed cities. All levels of siciverrl
ment, the private sector and neighborhopd groups
must respond to them beforethey get worse. Otherwise inefficient use of scarce public resources, eco-ties and su

force tough regulations against redDefine andlining by private linding institutions. ,,Provide social services that are more responsive tothe needs of city residents e6c1 that contribute to clty,
revitalization.

nomic decline as industries close down or-move away,

and, most important, deterioration in the quality oflife for many American men and women and fhildrery4

can be ekpected to continue, The Adminis 'Ilion s
urban policy is aimed at extending the capacity.of

Supply funds for communiity and neighborhood,.

citie to:lievitalize potentially healthy but now decaying
neighborhoods;

.

.

bs.

:"------k

Provide improved housing, community services,
cultural and recreational opportitnities to neighbor-arts and fo'r preserving and expanding the cultural andintellequal wealth of cities.

Party St

hood residents;
Meet environmental standards and allow xesidents
to breatli clean air and drink safer water;

ment:

The teem "urban tprawl" iv-idly describes the unplanneAaphazard urban devyloprnents that saroundmany of our cities. These development patterns have
had' some beneficial results, notably in provid' g imny
Owed housing and better neighborhoods formoderate and middle income Americans. But ban,Preserve4 protect and efficiently use existingroaqs, water and sewer systems and other valuable
pu lic facyfies;,
Provide efficient, accessible and envgonm9ntal ytransportation choices to people and Kishsousprawl has also:"Degraded the environment and destroyed nature

In addition, efforts will- be focused on expanding dei,cent housing choices in cities and supporting t
lock to the city" moVement now , beginningappose in Amy cities. However, attenwts to elp
cities retain Or attract middle clats houleholds will

4

reSOurces;',.'

ProMted, the construction of costly servipe fediities that are not used efficiently;
Wasted rich agricultural land;
Wasted scarce energylletrources;

ndt be done at the expense of the poor.

t

1/4

Weakened economitpnd social conditions in

Since vesources are limited, the Administration

older cities

inténds to targorfunding first I"? Ae cities in dis-

suburban areas.

tress 'and their most troubled resglents. But

tions

130

as

residents and businesses

4,

lett for5. Fulfilling the National Urban, Policy

The Nation can no longer afford the costs. The
Administration will use all tools available to reduce sprawl. Its efforts must be t companied \by
housing and community develop ent strategies
to offset any negative effect the fight against spraWI
might have on housing choices.

Strategies for Iniplovientition Th e Administration

Under the Carter Administration, pretoration of theCongressionally-mandated national urban policy report was merged with fulfillment of a Presidential
campaign commitment to develop a national tAalan
policy that would focus national resources upon thepreservation of the Nation's cities. This urban policy
report presents much of the analysis and data uponwhich the President, with assistance of the Urban andwill initiate the following strategies to encourage',Regional Policy Group, formulated his policy andmord efficient land development patterns:
Amend Federal Programs to support anti-sprawl

based his recommendations.

objectives. Wp should look tritically at the sprawl-

Since March 27, 1978, when President Carter presented his comprehensive urban policy to Congressinducing effect of Federal actions. Aid to states, cities
and builders should be clearly related to their impact
on itthd development. We should favor proposals.supporting: (1) compact ,community development overscattered, fragmented development, and (2) revitalization over new development.

Coordinate Federal and state actions affecting
development., We should.cdordinate Federal development activities with those df the states. if we do not,development undertaken or assisted by both levels ofgoyernment will encourage land use patterns that result in pollution, clogged highways, underused public
services and ulities, and wasteful use of scarce land
resources.

Our efforts with states should encompass:Use of Federal and state construction, transportation, water and sewer programs in existing
urban areas;

Removal of Federal and state tax, business andinsurance regulations favoring decentralization,
StiOulate coordinated metrdpolitan wide land use

pftins and developrdent programs. It will work withstates to encourage development of' coordinad
metropolitan wide land .use plans and developmeM.
programs. Ninning aid will be given to those metropolitan jurisdictions willing to demonstrate areawide approaches to stdpping sprawl, These efforts will bei encouraged through supplemental Federal funds.

,

and to the Nation, the national urban policymaking
process has entered a new phase. Now departments
and agencies throughout the Federal government are

taking steps to reform existing programs and todevelop proposals for legislative action. State andlocal vovernment off icials.are preparing themselves toenter into the partnership opportunities that are
being opened, as are private entrepreneurs, voluntary
associations, and neighborhood groups.

In the c6urse of these actions, and in the course ofCongressional review, new insights will undoubtedly
be produced, and new dimensions added to the nq .
tional urban policy. For a nMional urban policy canproduc f
not be made -once for all time. It
ed as.1) be cdolibeiation and interaction
as further
new information becomes availabdeliberation and interaction reveal ways to make public actions mdre responsive to community needs.
4

Two years fronk_now, another national urban.,poHcy

report will be submitted to Copgress by Prettdeot
Carter. By then sufficient time will have lapsed topermit an assessment of the fruits of this effort. By
then it may be possible to tetrflow muct better off
cities are as a result of deliberate efforts to reduce theinadvertent harm that governments ccArnit when
they try to dd gqod and to increase thgicoordinationand targeting of Federal assistance foi- the Nation's
urban areas and pedple.

47

Specifically, using the 1978 Report as the foundation, the 1980 National Urban Policy Report would:
Assess how successful the "New Partnership" inkiative has been.

FocusAon the evalbation of each of the Urban
Policy oMctivas, reporting on problems in their implementftlpn and any policy refinements and additional urban policy-recommendations, yhiLwould be
the core part of The 1980 Report.
Highlight select urbanIp.poficVraclions sufh as Ahe urban Impact procedure, themodifications to Federal progratns in making themi28

more urban sensitive, the accomplishments of tho
public/private sector effoets to conserve communities,sOlace less ethphosis on a lengthy discussion oftrends and present a summary picturti of vvhere
urban Amer ica is going. Urban trends will not change
significantly from what we see today. 'The T982 Report as mentioned earlier, with now 1980 Census data
might provide a greater contribution in this area.
Continue the "open dialogue" process on urban
policy as identified in tkiis Report.

41.

(

.4

_471

-71

132
"Z.

re
A

Acknowledgemoqi

Thi; Report was prepared undor the direction of theWhite House Domesticfolicy Office with major staf f
support coming from the Department of Housing and
Urban Development under the leadership of Socro

Ralph Widnor and the Acaderly for Contemporary
Problems who extended export guidance and assistance in this effort.

tarx.Patricia Roberts Harris.

The project Director for the Report was Robert P.

Acknowledgement is due the HUD Urban Policy staff
whose work was guided by Assistant Secretary for

Duckworth, StaffkDirector of the Office of Urban andffegional Policy. Principal Urban Policy staff support
wriS prOvided by Joan Allman, Bobbie H. Denson,

Community Planning and Development Robert C.
Emtyy, Jr. and his Deputy Assistant Secretary
Yvonne Scruggs Perry. In addition special appreciation is given to Assistant Secretary for Policy andResearch Development Donna Shalala and her staff,
especially-Christopher Wye, who contribtfted greatlyFranklin James, Donald M. Krumm, Judith J. May
and George W. Wright, Secretarial and clerical support
was provided by Elaine M. Wilson, Michelle K. Bryant

and Elvenia Diane Holloway. Design and printing
support was provided by the HUD Office of Printing
and Visual Arts.

to the Report. A debt of gratitude is ixtended to

1 33

4

Appendix A
1

Title VRNetional Urban Polley and
Now Community Developmont Act of 1970
Short Title and Statement of Purpose-/-

Sec. 701. (a) This title may be cited as the "National
Urban Policy and New Community Development Act
of 1970."(b)

It is the policy of the Congress and the purposeof this title to provide for the development of anational urban policy and to encourage the rational,
orderly, efficient and economic growth, development,
and redevelopment,of our.states, metropolitan areas,
cities, counties, towns and communities in predominanlly runqj areas'which demonstrate a special
potential for accelerated growth; to encourage theprudent use and copsenation of energy ani) our
natural resources; did to encourage and support

strengthening the economic and social health of allareas of the Nation and more adequately protect thephysical environment and conserve energy and othernatural resources, the Congress declares that the Federal government, coneistent with the resPonsibilitiesof state and local government and the private sector,
must assume responsibility for the development of anational urban policy which shall\ incorporate SOCial,
economic and other appropriate factors. Such policy
shall serve as a guide in making specific decisions atthe, national level which affect the pattern of urban
development and redevelopment and shall provide aframework for development of interstate, state, andlocal urban policy.
(d) The Congress further declares that the national
urban policy should(1) favor patterns of urbanization and economic

development which .will assure our communities ofand their residents adequate tax bases, community
services, job opportunities, anA good housind in wellbalanced neighborhoods in social)y, economically,and physically attractive living envifonments.

developMent and stabilization which offer a range ofalternative locations anti encourage the wise andbalanced use of physical and human resources inmetropolitan and urban regions as well as in smallerurban Places which have a potential for acceleratedgrowth;Part ADevelopment of-a National Urban Policy(2)/foster the continued economic strength of allparts of the United States, inclUding central cities,
suburbs, smaller coMmunities local neighborhoods,

Findings andpeclarron of Policy

and rural areas;Sec. 7p2. (a) The Congress finds that rapid changes(3) encourage patterns of development and redevelopment which minimize disparities amordrstates, regions, and cities;

j in patterns of urban sqttlement, including change in
population distribution and economic bases of urban
areas, have created an imbalance between the?'Natioe's needs and resources and seriously thrbatee
our physical and social environment) and the financial(4) treat comprehensively the problems of poverty
and employment (including the erosion of tax bases,
and the need for better community seMces and job
opportunities) which are associated with disorderly

viability of our cities, and that the economic andurbanization and rural decline;(5) develop means to encourage good housing for all
Americans without regard to race or creed;(6) refine the role of the Federal Government in revitalizing existing communities and encouraging
planned, large-scale urban and new community
development;(7) strengthen the capacity of general governmentalsocialof thedevelopment

Nation,theproperconservation of our energy and ojher natural resources, and the achievement .of satisfactory living
standards depend upon the sound, orderly and morebalanced developinent of all areas of the Nation.

(b) The Congress further finds that Federal programs

affect the location of population, economic growth,and the character of urban d r eloPment; that suchprograms frequently conflic nd result in undesirable
and costly patterns .of u an development and re.
development, which adversely affect the environment,-

institutions'to contribute to balanced urban growthand stabilization; and(8) facilitatq increased coordination in the administration of Federal programs so as to encourage desirable patterns of urban devqlopmlint and redevelop-

and wastefully use- energy and other natural resources; and that existing and future progrants must
be interFelated and coordinated withio a system oforderly develepmentand -established priorit les-eon-

ment, encourage the Prudent use of energy and other 4
natural resources, and protect the physical environment.

sistent with a national urbart policy,

National Urban Policy Report(c) To proMote thelleneral welfare , and properly
apply the resoUrces of the Federal govbrnment in

Sec. 703. (a) The President shall transmit t%.,thev

Congress during February 1978, and during February

134

1.0

4

132

of every even-numbered year thereafter, a Report on
National Urban Policy which shall contribbte to theformulation of such a policy, and in addition shall
include--(1) information statistics and significant trends rolating to the pattern of urban development for thepreceding two years,(2) a summary of significant problems facing theUnited States as a result of urban trends and developments affecting the well-being of urban areas;(5) an assessment ot the policies anki structure of existing and proposed interstate plikraOqiend develop
merits affecting such policy;'
rid Niote 'pohcles,(6) 11 review of state, local,
plans,- and prograces, levant to sAh(7), current and tows able needs in tlici awes servedby policies, plans, and wograms,00sigravtiO carry dui
such policy, and the st pu-laerrig taken to rnevt.sucb
needs; and,(8) recommendations for programs ancrpckies for(3) an examination-of the housino. and related com- prrying out such policy, including such legislation
munity development problems experienced by cities /and administrative actions as may be deemed
undergoing a growth rate which equals or exceeds tho necessary and desirable.
national average;(4) an evaluation of the progress and effectiveness 0191%) The President may twnsrnit from time
Federal efforts designed to meet such problems and the Congress supplementary and raw
to carry out the national urban policy;
mendation as may..be appropriate.

Jv

,

35,

time torecorn-,Appendix Bk.
Improve the urban physical environment and thecultural and aesthetic aspects of urban lite by providing additional assistance for housing rehabilitation,r mass transit, the arts, culture, parks and recreation

President's Message to Congiesi

on the National Urban Policy
To the Congress of the United States'

sulimit today my provosajs for a comprehensive
nationel urban policy. These proposals set a policy
framework for actions my Adrninistretion has alreadytaken, for proposed new initiatives, and for our efforts to assist America's communities and their mi..
dents in the years to come. The policy represents acomprehensive, longterrn corn ill II 11191:1 t to theI

Nation's urban areas.
,4

The urban policy I airrannouncev today will build a
New Partnership involving ..all levels of govqrnment,
the private sector, end neighborhood and voluntary

Organizations in a major effort . to make America's
citiet better places inwhich to live and work. ff is acomprehensive polic-Iiimed both at making cities)\\:,
more healthy and imp ving the lives of the people
who live in them.
The major proposals will:,Irnprove the effectiveness of existing Federal programs by coordinating these programs, simplifying
planning requirements, reorienting resources, and reducing paperwork. And the proposals %ill make 1:ederal actions more supportive of the urban policy
effort and' develop a process for analyzing the urban&and cornmun4 impact of all major Federal

ittiatives.
Provide emPloyment opportunities,

America's communities are an invaluable pationel

asset. They arc the center ol our culture, the incubators of new'ideas and inventions, the centers ofcommerce and finance, hnd the liomes of our groat
musewms, libraries 'and. theatres. Cities contain trilliont' of dollars of public and private investments-investments which we must conserve, rehabilitate andfully use.
The Now Par tnership I am prop9sing today will foccfs
the full energies of my Administration on a comprehensive, long-term ef fort. It will encourage states toredirect their Own xesources to support thoir urbhu
areas more effectively. It 'Will encourage local governments to stream/Me and coordinate their own
activites. It will offer incentives to the private sector
to make oow investments in economically depressed
communities. And it will, involve citizens and neighborhocid and voluntary organizations in meeting the
economic and social needs of their communities.

The New Partnership will be guided by these principles..
Simplifying and improving programs and policy at
all levels of government

Combining the resources,of Federal, state andrimarlyn

local government, and using them as a lever to involve

the private sector, to the long-term unemployed ancithe even greater strength of -our private economy toconserte and strengthen our cities and comrhunities.

the, disadvantaged in cities. Thill be done througha labor-intensive public works program and 'tax andother incentives for' business to hire the longterrn
unemployed.

hardpressed com. Provide fiscal relief to the most,.
munities.
. Provide strong incentives to a\tract private investment to distreSsed communities,- including thecreation of a Nationai Development Bank, expanded
grant programs arid targeted tax incentives.
Encourage states to become partners in asSisting
urban areas:through a new incentive grant program.

$timulate greater involvement by neighborhood
prgonizations and ..yolUnta y aS50,t4ations thughfunding neighborhood devel ment projects and bycreating on Urban Volunteer trps. These efforts will-

be undertakenwith the a45rovl of local elected
offidals.
Increase access to opPortunity foF those disadvantaged by economic Circumstances or a history.
of ditcrimination, 9Provide 'additional 'sodal and health Services to.

.

disadvantaged people in cities and 'cprnmult-7it1es, .r.r)

Being flexible enough to: give help where it ismost needod and to respond to the particular needs-r of each cqrnmunity.
Ihcreasing acceSs to opportunity for those disadvantaged by economic circurnstances or history of
discrimination.
And above all, drawing on the sense of community, and voluntary effort that I believe is alive in
America, and on the- loyalty that Americans feel "forthe -neighbdrhoods.

The need for a New Partnership is clear from therecord of the last fifteen years. During the 1960's, theFederal government took a strong leadership role inrespondind to the problems of the cities. The Federal

government attempted to Identify the problems,develop -the solutions--and-implement the programs.
State and local governments and the private sector
were not suf ficiently involved. While' many of° these
programs were successful, we learned on importantlesson: that the Federal government alone has neither

36the resources nor the knowledge to solve all urban

134

problems.

An equally important lessOh emerged from the experience of the early 1970's. During this pedod, theFederal government retreated from its responsibilities, leaving states and localities with insufficient
resources, interest or leadership to accomplish all thatneeded to be done. We learned that states and- localities cannot solve the problems by .themselves.

1for employment and training doubled from FY '77 toFY:79 to over $12 billion.
A $400 million private sector lobs proposal _has

been included In my proposal to reauthorize the
CETA- legiilation, This initiative will encourage
private businesses to hire the long-term unen)ployed
end the disadvantaged.
A sixty-five percent increase-in grants provided by

the Eceric Development. Administration to dl-ban
areas.

A thirty percent increase in overall rederalassist'once to education, including a $400 million increge
policy must build a partnership that involves the An the 'Elementary and Secondary EdticatIon Act,
leadership of the Federal government and thetargeted in substantial part to large city schoolparticipation of all levels of government, the private systeins with a concentration Of children from lowThese experiences taught us that a Successful' urban

sector, neighborhood and Voluntary organizations And
individual citizens.

income families.
An economic stimulus package enacted last year,(Anti-Recession Fiscal Assistance, Local Public Works.

.Prior Actions

and CETA) Which rrovied almost $9 billion. in

The protretris of our Nation's cities are complex 'anddeep-seated. They have developed gradually over a\ generation .a§ a result of private market and demographic forces and inadvertent government action,and the problems worsened markedly during the early
1970's.

These problems will not be solved immediately. They

can be solved only' by the long-term .conimitmeritwhich I offer today, and by the efforts of all levels ofgovernment, the private sectorrand neighborhood andvoluntary organizations.

additional aid to states and 'ties.
A welfare reform propo I which, upon passage,
will provide immediate fiscal relief to state and local
governments.

A doubling of outlays for the Section 312'

housing rehabilitatiOn Joan program.
Creation of a consumer 'cooperative bank which
would provide financing assislance to .consumer cooperatives which h-ave difficulty obtaining conventional financing.
improvements in Existing Programs,

The Administration's Urban and Regional .Policy
For my 'Administration, this commitment. began on
the day I took office and it will continue throughout.
, my Presidency. With the Cooperation of Congress, my

Administration has already provided substantial in%creases in funding in many of the major urban assistance programs: Total assistance to state and local gov- .Environmental Protectir:qt Agency, and has developed
ernments has increased by 25 percent, from $68 bil-. proposals to make their actions more supportive oflion in FY 1977 to $85 billion in FY 1979. These urban areas. As a result of this massive effort, the Fedincriases are the ,direct retgult of actions we hwie, eral goverrnme6t has baZome more sensitive to urban
problemd more committed to their solulions.
taken during the past 14 Mbriths. They areas much apart of my AdMinistration's urban policy as the initiatives which I am announcing today. Some of themost important programs have already been enacted.,
into law or proposed to the Congress. These include:;

Group (URPG) has examined all of the major urban
assistance proirams and proposed improvements. It
also has worked with agencies traditionaN not involved in urban policy, such as the Defense Department, the General Service§ Adreinistratioh, and theA $2.7 billion -increase over three years in the:Community DevelOpment Block Grant Program,accompanied by a change in the forMula to provide

The revif existing Federal programs has resulted
in more than 150 improvements in existing programs,
Most of these improvesnents can be undertaken im-

mediately through administrative Jrction. Some-willrequire legislation. None will increase till Federal
budget,mere assistance toThe Older and declining cities.

A $400 million a year Urban Development Action
ant Program providing assistance primarily to discfties.

A few examples of the improvements are:All agencies will develop goals and timetables forminority participation in their grants and contracts,

Ith

An expansion of youth Ond training programs andan increase in the number of ptibjic service employ-,..,..ment jobs, frog) '325,000 to 72500. Expendikures:

Vfive major agencies have already begun.

The Defense Department MI set up a new program to increase procurement in Littian areas.
r'Y

E P A will modif' its water.and sewer program todiscourage wasteful sprawl.
HUD has retargeted the Tandem Mortgage Astkist-once Program to provide greater support for urban

completed the first stages of this work. During thenext several months, they will consult.with the Con

135

gress, state and local officials and the public t4t devel,
op the best solution_

housing.

The existing countercyclicaI fiscal assistance program wilt be retar.geted to help governments with-unemployment rates above the national average.
HUD anCi EDA are developing common planningand application requirements.
The General Services Adminktration will attempt
to locate Federal facilities In Cities whenever such alocation is not inconsistent with-the agetky's mission.,
The Department of Transportation has proposeq

There are several actions I will take immediately,

Urban and Community Impact Analysis I am implementing a process through my Domestic Policy 'Staff(DPS) and Office of Management and Budget (0MB)
to ensure that we do not inadvertently take actions
which contradict the goals of the tirban policy. !Eachagency submitting a major domestic initiative ,must
include its own urban and community impact ma-legislation to consolidate many categories of urban lysis. DPS an'd gMB will review these submissions andhighway and transit grants, and to standardire the will ensure that any anit-urban impacts of proposed
local matching share. These steps will provide local-- Federal policies will be brought to my attention.
'govecriments with greater flexibility to develop trans- pIntaragency Coordinating 'Council To improve program coordination, I will form" an Intereg4icy Co, portation systems suited tO th, needs.
'The Environmental Protection Agency will amend orvil1nating Council, composed of the Assistant Secreits regulations to accommqate new economic devel- taries with majqfprogram responsibilities in the key
opment in high pollution dims. Localities will be per- urban departments. Ttie Council will have two funcmitted to "pank" reductions in pollution which result tions:from firms going out of business. These reductiorthen can tle, transferred to new firms locating in the It will serve as a catalyst for :operational improvecommunity.
ments which cut acfoss Departments (for example,'instituting uniform 'grant applications); and it will enThe effect of all these changes may be greater illan courage interagency cooperation on projects which'even the substantial new initiatives which .1 have pro-are too large or too comple tbe funded by one

posed in this message.

agePtcy. This Council will, for thFfirst time, provide a
coordinated Federal response to communities whichdevelop comprehensive and multi-year projects. It
will have direction from the Executive Office of the

New Initiatives

The new initiatives which I am announcing today address five major urban needs:

President.

Consolidating`Planning Requiremetits and Othir Management, Improvements We soon will announce thelocal governments.
consolidation of ibtra-agency- planning requirements.
2)
Employment and Economic Development
I have asked the Director of the Office of ManageFiscal Assistance3)
ment and Budget to direct an interagency task force
Community and Human Development4)
to improve the management of Federal grant-in-aid
Neighborhoods and Voluntary Associations
5)
programs and consolidate the numerous planningrequirements in the community and economic (levelThese intiatives require $4.4 billion in budget author- opment grant programs..
ity, $1.7 billion in new tax incentives, and $2.2 bil- lmproVed Data and Information I have asked the- lion in guaranteed loan authority in FY 1979. For FY Secretart of CommerceOn her capacity as Chair of1980 the' budget authority will be $6.1 billion,. the the Statistical Policy
dination COrrittee, to/ax incentives $1.7 billion and the guaranteed loan design an improved u.k.
ata and information-sysauthority $3.8 6illion.
tem. At the' present:MI*6 much of this data' is inade4
quate or out of dMe,
1)t

Improying the operation 'of Federal, state andFederal Programs

The Role of State Oovernments

Over the long run, reErganization of the economic
and community developenent programs may be neces-,, saw. Last June, I directed my reorganization project
staff in the Office ot Management and Budget tobegin exploring the reorganization options. They haveState government policies, even more than Federal
policies, are important to the fiscal and economic
health of cities. States affect their cities in a numberof ways, including setting taxation_end annexation

4.1.0
^
k

A

38

.

40r

A.

powers, deter mining the placement of major dovol p

136

mem investments and apportioning thefirv jot

responsibility for welfare and education expenditt es.

works program, a targeted employment tax credit,
and a private sector training and/jobs initiative toencourage -businesses to hire the hardcore unemployed, together with the extension have alreadyI

The Federal government has little or no control overthese developments, all of which clearly affect theet:onomic and fiscal hrtMth of cities and communities.
These state respomAYlities underscore the need for an

urban policy which includes the states as full andequal partners. The effectiveness of our urban policy
will be enhanced if tho states can bo encouraged tocomplement the Federal effort.
.o*

To encourage states to support their urban areas, I

will offer a new program of state incentive grants.
These grants will be provided. on a discretionary
basis, to stales which adopt approved piens to help.
their cities arP communities. The plans must be

developed with the participation and Approval of'commutlities within the state. The grants will be pro
videct to the states to finance a portion of the plan.
The State Incentive Grant Program will be administered by HUD and will provide $400 'million overI.

proposed in employment and traininoP pportunities
under he CE TA Act.

In the Icing- run, the policy attempts to rebuild theprivate sector economic base of thesq comnlunities
through a National Development Bank, a special tax
incentive, an increase in economic development
grants end other incentives,

Labor-intensive Public Works

I ask congross.for $1 billion a year for a program oflabor-intensive public works; targeted on communities with high unemployment. Half of tho estimated
60,000 full-tirne equivalent jobs created annually by
this program will be reserved for the disadvantaged
and the long-term unemployed. 1 hese woi kers will be
paid at Davis Bacon trainee wage levels.

two years,

This program will enable cities 4 make needed ri
pairs on buildings, streets, parks, and other public

Local Government Role

facilities.

Many communities and cities can improve manago
rnent and planning improvements by reforming fiscal
management practices, streamlining local regulaturry
procedures, and coordinating local coMmunitr andIn contrast to the Local Public Works program
which involves pAojects requiring large equipment,material expalditures awl a rekAkonged plaiming per.
iod more, of the funds under this labor-intensive prograp will go to job creation.

economic development activities.

The Federal government provides planning and tech-nical assistance to coMmlinities through HUD andCommerce to help cities improve their managenientand plannihg practices. These funds will be used increasingly to build the local goVernrnent's capacity tounderta.ke the necessary fiscal and management refortns,r"

ted Employment Tax CreditI

proosd a 1argetecl. Employment lax Credit

al

to en

e.,bkisines's to hire disadvonta4ed young

workers etween the ages of 18 and 24 who suffer
the highe t unemployrpent rates in the Nation.

The Federal government will offer special consicleration in discretionary programs to cities which achieve
coordinted action at the local level.

Under my proposal, private employers of young anddisadvantaged, or handicapped, workers would beentitleti to claim a $2,000 tax credit for each eligible

II. Employment and Economic Development

w rker during"the first year of employment and acredit for each eligible worker during -the
$1S
secon

ear.

--,b-Thrre is a serioqs shortage of jobs for many residentsof our urban areas and a lack of investment to build
the tax base of our cities.*.

I aM prQpojQghis Targeted Empjoyment Tax Credit
as a substitute -for--the expiting EmploYineeit Tax
Credit. The current program costs $2.4 billion a year
The urban policy will address this issue in two ways. and, has had little influence on hiring decisions. The
Administration's targeted program will.cost approxiIn the short run, it *will provide additicAal employ- mately $1.6 billion a year, with far greater impact.
ment Opportunities through . a labor-intensive public

139

Oa

Locatior; of Feder& Facilities

could, at its discretion, reduce the interest rate down
to two and onolhalf percent for particularly desirable
projects. Bank financing would be conditioned on ob-

will §Igh a now Executive Order directing the General Services Administration to give first priority tr5
cities in locating new Federal facilities or consolidatmg or relocating existing facilities. Under my Admin, istration, Federal facilities will be located in cities,'unieqs such a location is inconsistent with the Nan
I

/

137

taining 21 percent of the prbject's total costs fromprivate lenders.

1 he ceiling for in.dustrial reserve bonds in economically distressed areas would be increased from$b to $20 million with the approval of the Bank, Abusiness which used this financing for a project could

cy's mission.

also receive a grant.

Federal buildings and facilities can be an importantsource of jobs and of rental payments and, in many
cities, a principal stabilizihD force preventing decline.

I,,

The. Bank also will provide a secondary logri

market ror private ) bans in eligible areas to financecapital expenditur s. This will be parti.cularly boneficial to.small businesses.

The Federal government stpuld sot an exampk e. forth private sector to invest in urban areas.
(lot GOvernment.Procurement

To assure that Federal procurement is used tostrengthen the economic base of our Nation's cities
and cqmmunities, I Will:
strengthen the implementation of, the existingprocurement

set-aside , program for' labor survius

areas, by dir&ting the General ServicRs AdministratiOn' td work with each agency to develop spcwificprocurement targets and to Monitor their 'implementation. GSA will report to me every six months
on the progress of era Agency;clirect the Defense Department to implement an,experimental program to *target. moreof its procure,.
meni to high unemployment areas.' -/eligit*. Additional employment would be a key testof project eligibility.
1 he Bank will be an interagency, corporation, governed- by a Board composed of the Secretaries of
HUD, Commerce 6nd the Treasury. This will ensure
coordinatiorNetween
the maNceconomic, commy_
nity development and urban finance agencies of ;thegovernment.

'The Office Of Management and Budget is currently
assessing the organization of the Federal economic
and community development activities. -The Bank willfunction on an Interagency basis pending recom-tCtional Development ;BankI

Bank projects will require the approval -of state or
local government econoAN development entities,
which wfouid be responsible NI the elected local leadership. Distressed urban ,and ThroVareas would be

Mendations in this area.

propose the creation of a National Development

Economic Development Grants

Bank, which would encourage businesseg to locate or

expand in economically distressed, urban and rural.th-das. The Bank would .be authorized to guarantee
investments totaling $11 bfflion through 1981.

,

,

I.

To Tower operating costs in urban areas, the Bank
would provide long-te rn, low:cost financing which, in

conjunction Mth oxankd grant programaistered by HUD and FDA,min-

ill reduce a firm's finc-

Ing costs by up to 60 percek,

Taken together these major increases will help leverage,substantial new private sector investment in urban
areas and address the long-term economic deterioration experienced by certain trban and rural areas.

Differential Investment Tax Credita project The Ants, which wcvüld be made underI

penditures for lend 'assembly, site preparation, rehabilliation, and equip'rnerrt.
Loan,guarantees, provided by the Bank to cover,

thretquarters Of the remaining'capital costs yp V* a
-MaXhtturn of $16 Million; per projec.!t.. The Bonk,:in the UDAG grant program and the EDA Title IX
program. These increases will be used in conjunction
with the financing lncentiyes available from- the National DevelOment Bank. ,The Bank uses four raJtr finan619 tools:
taints of up to 15 percent Of a firm's total capiOil cost, to a maximum 43 million, forlixed asetscf'expanded EDA and HUD authorities, %fluid cover ex,

I .propose substantial increases of $275 million each

,

6

'

propose that firms that Itcdko` or expand in eco-nomically distressed areas be eligiblehor a differentialercent Investment tax credit, to a totafrof 15 per-for both structures and equipment. The' credit
woi1Ndjbe available only to firms awarded "Certificates of Necessity"py, the Commerce Department
based
tncing-:NEted and employment botential.

I.

COnmerce will be auth?rized to issue up
million in certificates PdT rtch of the next t

138

00

Air Qualitc, Planning Grants

planning grant prograno
propoNi a $25
help cities and communities comply with-the ClahAir Act withOut limiting severely now, private sector
I

Role of Private Finanaal Institutions

An affective 4-irban strategy must iNolve privote financial institutions. It am asking the itpepondent
financialikeigulatory agencies to develop appropriate
actions, consistent with safieound and prudent lending practices, to encourage financial institutions toplay a ()rater role in meeting the credit neeNtif theirinvestment wipin their areas.

ununities.

.have also asked EPA, HUD and kDA to provide First, I arn requesting that financial regulatory rmn- 'technical assistant to help local governments reconcile sties determine yvhat further actions are nocessry to(.

potenhal conflicts betAeon air pollution enco-

halt the practice of regliningthe refusal to .terid

nomü development griefs.

credit without a sound economic justification. I win
encourage those agencies to develop strong, consistent and effective regulations to implement theCommunity Reinvestment Ad.

Itt

Minority BusinessMinority businesses are a critical part of the private
sector economic base of many cities, cort'ununities
and neighborhoods, and provide important employment opportunities to city residents.
prolpose, today twbi important initiatives which will
increase the (ole of minority businesses in our economy. First, in comparison With FY 1977 levels, weI

4

propose the creation of an Institute forCommunity Investment, under the Federal Home
Loan Rank Board. The Institute will bring together
Second,I

appraisers, realtors, lenders, buidling and insurance.
conipanies to develop a consistent approach toward
urban lending and to train urban lending specialists.

will triple Federal procurement from minority businesses by thil end of FY 1Wen increase over ourearlier commitment to doub% minority procureinent.

Third, I propose ,a pilot program ;to create Neighborhood Commercial Reinvestment Centers under the

In addition, I intend to ask all Federal agencies toinclude goals for minority, business participation in
their contract and grant-in-aid programs. Fiv3 agen-vestment 'Task Force housing credit concept to thecommercial credit area.. Neighborhood Commercial
Reirumstment Centers wnl be local organizations,Comptroll0 of the Currency. This proposl is anadaptation of the highly successful Urban 'Rein-

ciesHUD, Commerce, EPA, Int4rior -arid DOT% comprised of merchants an.d neighborhood residents,-alrtity have -propoad improvements in 'minority loca1. government .officials, and commercial btliSks
business programs. -Mese programs all build on our which will provide business credit in urban neighborsuccwful exkuyience with' the Local Public Works . hoods. SBA, EDA, and HUD Will work with the.financial regulatory agencies to revitalize specific comProgVilm.
mercial areas.

Finally, I intend to facilitate 'greater interaction be- r
tween the minority business community and thb lead- Finally, I have asked the Secretary of Housing and
Urban Development to chair an interagency task
ers of our Nation's largest corpritations.

force to evalubte the availability f credit in urban'
areas and recommend appropri e further action. I
have alsked the ttO force_ft examine and makerecommendations With respect to the following areas:

Community Development Corporations

I propose that an additional $20 million be appropriated to the Community Services Administration as
venture capital for the most effective Community
Development Corporations. This assistance \gill help

them have a substantidi impact on their Asignatedareas/`1

be made availabletfor projects that
The funding
receive support from local elected officials, involve
leveraging private sector funds and are,coordinated"

The availability of mortgage and copimerfcial
redit in urban areas, and the impacts of the activities
f Federal agencies on such credit;
Existing mortgage insurance, ca alty insurance
and business credit insurance program
The full range of urban credit and insurance risk
reduction techniques.

.

Fiscal Assistancewith HUD, EDA or the Small Business Admin-- ,While the fiscal condition of many state and local
istration.

govIn2ents has improved dramatically .over the last

rk,

)
Pio

.1

1 o.

three years, many cithes and communities sUll are experiencing severe problems. These cltiel and càmmunilles require fiscal assi,§tance from the Fedaral government, if they are to avoid severe service cutbacks or
tax increases.

t

panded effort will permit the rehabilitation of small
multi-family housipg projects in distressed neighti_or.
hoods, tor which financing presently is inadequate, In
addition, expanded Section 312 funding will be used
to strengthen tho Urban Homesteeding program.
Urban Transportation

Supplemental.f iscal Aistancein many hities, public transportation *is inadequately
once through the Anti-Recessiort isca Assistance financed. The Federal government has begun to make
/V (AR FA), which expires on Ser tember 30, 1978. substantial investments to reltabilitate, revitalizo andThis program has been an effective tool for helpinit construct urban transportation systems.
states and local governments withstand the fiscal imI have !ready submitted to Congress my proposals topact of high unempl yment.
extend id strengthen the highway and mass transit
ties and co mnih

Cur ran t unemployment

cut ren fly-6s0 t-rojections, however, suggestthat even ijI ARFA program were extended in its'current ftfm, t would, phase out by midi' Y.-/ft 9,

programs.

To supplement these efforts koday propose an addi-

tional $200 million for capital investments in inter-when On mplo ment 'is expected to drop below s
percent_ If die p'togram is pent-lilted to phase ou ,many pfies and communities will experience liver()modal-urban transportation projects. These funds wig

fiscal train,

selected-Gi ties.

p opose today that ARN\ be replaccid with a SupI
plen ntal Fiscal Assistance Program, which will provide 1 billion of fiscal assistance annually for the

Resource Recovery Planningnext two fiscal yors to locQl government!' oxperi
xtension of
enclpj significanf fiscal strainurth
this program will be considered together

th General

be used to link existing Importation facilities in'

Solid waste disposal is a growing problem in the manyurban areas which face a shortage of landfill sites. At

the same time, techniques to .roc-over valuable re
SOurais and energy from solid waste have emerged.

Revenue Sharing,
4I

will request $15 mi ion for the EPA to provide

of $300,000 to $400,000 to cities forfeasibility studies of soli waste recovery systems.

Fiscal Relief in Welfare Proposal

grantspropose to, phase in the fiscal relief
In adtition,
component of the Better Jobs and Income Act ,asArts and CultureIsoon as Congress passes-ills legislation, rather than,in
1981 as originally planned.k

Cities are centers ol culture and art, which thrive on
the vitality of the urban environment,

IV. Community end Ilimen Development

program to revitalize America's
A comprehensi
cities must pro e for community and human needs.
This involves ltoth physical tacilities, such es parks,
recreation factrities housing ard transportation
systems, and the provision of ha.6Ith and social services.

Rousing Rehat;ilitation

To help renew and develop thi artistic and culturll
spirit, I propose a new Livable Ci 'es program administered by the Department of H sing and Urban
Development, with the participation f the National
Endowment for the Arts. This program will provide
up to $20 million in grants to states and communities
for neighborhood- and community-Posed -arts dtograms, urban design and planning, and the creationand display of art in public spaces. Historic preservation of buildings shoultals6 be encouraged,,o..

Theonservation and upgrading of okir housing stockisimportant to maintaining the strength of urban

I

Urban Parks and Recreation-

areas. Housing rehabilitation improves the quality ofcommunity life and provides construction jobs in

The quality of life in-urban areas is critically affected,areas of high unemployment,
I propose an additional $150 million in FY 1979 for
the Section 312 rehabilitation loan program, Whichwill more than double the existivg program. This ex-by the availatAity of Opel) spaces and recreation
facilities. Yet hard essed Ommunities..often lackthe lipsources torun
thes$ amenft 16.

.1 A

trin and inVest adequately in

4'

r!

'

1

To addresigliktis prOblem4 propOsed)a major now cedoral grarrt prog--am. Urbae( communities will compete

Edudatlon

for funds traorevive and rebyld parks and recreation
facilities. Challenge grants totalling $150 million will
be prqvided for constrUction fled major reha8ilitationof urban recreation systems; iucp es parks, tennis andbasketball courts, swirnrning.pbol9, bicycle paths, andother facilities. Cities will be awarded grants based ontfie- quajity.of their planning, the degree of need andtheir ability tq malch the Federal funds with privateand local contributions.

Schools are the focus of community activities int-many places. Yek they are seldom fully used or linked.
to other community and social serviEos.
I

I

in ind/'to/provide $1.5 million to expand theexporimenfil Cities in Schools progrAtn which seeks

to bridge the gap by uniting a number of social
services within schools to better serve both students
and their families. I.Ne into%) to expand this. prom.ising new or ogr am to 10 pilot schools.

Social Services

In addition, urge the Congress to enact the )00
million increase in the Title I program of the E letetntary and Secondary Education Act, which I recently
proposed, including my recommendation that $400
million of these funds be targeted to cities and otherareas with high concentr ions of low-income famiI

Urban revitalization ef forts must be accompanied byefforts to help those in need to improve their own
lives. A variety of income support and social service
programs are.designed to do this. Sinca 1974, however, the ,support given to state social service
programs by fhe Federal government has declined inlies.

real terms,'

V. Neighborhoods and NC"! tzr Organizations. ,propose an additional $150 million of now budget
authority for the Title 50( prwarn. These funds will
be used to fliproVe the delivery of social services inurban areasrenging from Meals on Wheels for theelderly to day care for children of working mothers
and to develqp 'greater coordination Owpon local,
I

No resource of our urban communities (morevaluable than the commitMent of our citikits.
Volunteer groups, which gain strength from the self-

less efforts of limy individuals, make tin indispen-

public and private agencies.

sable contribution to their cities.

Health Services

Urban Volunteer Corps'

Nearly 50 million Americans live in areas without

I
Propose a $40 million program in ACTION to
increase the effectiveness of voluntary activities at the
local level. With. the agreernent of local government,

adequate health services. These areas, many of which
are in inner pities., suUer from higher infant mortality

rales, greater poverty and shortages of health carethe program will create a corps of volunteers at the
local leybl And match their skills with the needs of
local goverrIents and crmunity and neighborhood

personnel.

In underserved areas, emergency room and outpatient
departments of city hospitals are used as the toufin
source of medical care by the poor, primarily dthe lack of. private physisians. As these departments
were not designed to'vrAtid,A,Ormprehensive medicalcare, the hospital resources `are s`trained and the poor

often lo without adequate care.

To, help meek the primary' health care needs of theurban poor and reduce the strain on city hoseiitals, I
proposed to expand fedarally-supported Communjty
Health Centers And to fand city-sponsored prograrns
which provide comprehensive, but less costly, priMary care serVices. The city-sp000red programs willenroll the medically indigent. IR existing health sys-tems, such as HMOs. -qiey also will help expand
Idcally-supported centers,.reform hospital outpatient
aepartinents and providecomprehensive health services..

orginations.
It alSo will vrovide small grarieNaveragi4 $5,000 for
voluntary Improvement and beautification projects.
ACTJON would select, with the concurrence of local
governrnent,r lead, agency iri each city to administertFie Urban Voluntbfir Corps,
Self-Help Development Program

Neighborhood associations are playing a key role inhousing and neighborhood revitalization. We muststrengthen that role.
I

will reqUeSt $15 million EY 1979 for a self-help

development program to be edministied by the
Office for Neighborhoods in HUD.

qp

tr,

-.

This new program will provide funds for specifill
olcts in poor andhousing and revitalization
low-income areas. Each proj t wefuld involve the_participatio%of local residents,..thtyprivato sector andlocal gover(ircionf and Would reouirtl- the !concurrence< of the mayor.
Crime Prevention

Streeticrime is a serious problem in America's cities
and cdmmunities. Over the last few years a number ofpromising initiatives have been undertaken by com-.

munity jroups and local lair enforcement 4ncies tocombat streot crime. EscoN services for the elderly.
centers to help the victims of crime, anskneighborhood watchers are examples of promising developments.

Unions address th

141

problem by investing their assets

los in which they are established.
This type of c edit union was first established under
the pover ty programs in the 1960's. About 225 exist
today, and ninny are the only financial institutibns intheir communities.

in the commit

I am proposing a $12 million birogram to provide$200,000 sued capital for new Cit mmunity Develop-rne9t Credit Unions, to provide them With an operating' subsidy for staff, trairiing Aind technical assistonce.

.

The jo of revitalizing the urban communities of ourcountry will not be done overnight. Problems whichhave accumulated gradually over generations cannot
be solved in a year or even in the term of a President.
1.

propose a program which will geld 10 million in But I believe that a New Partnershipbringing tonew resources to existing efforts in tt Law Enforce- gath er in our common e`fltzrt all who have a stake inment, Assistane Administration for a yrogram oper- the future of our communiti --can bring us closer toated jointly by ACTION and I. EAA. Under this.pro . our long term goals. We can makei4mt. l's cities
gram, mayors and local neighborhOod groups will de- 'more attractive places in which to live and ork; wevelop community crime prevention progrems based can help the people of urban America load happieron successful pilot models. My reorganization prond more useful lives. But we can only do it together.
posals for LE#,A end the legislation I will submit toextend the Law Enforcement Assistance Act will )Jimmy Carter
strengthen our efforts at crime prevention,
The Mite I louse
Community Development Credit Unions
March 27,1978
I

Some urban communities are not seNrt,
ed by any finaninstitutions.
Community
Devepment Credit----,cial

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