Minneapolis spokesman., 1962-07-20
Urban Renewed. A
Moral Challenge.
Article CIuims
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AhuCB$ SH0nk1tS
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on which FILA. will insure a first
mortgage Of up to 80 per cent OF
the cost (including a 10 per cent
profit for the builder-developer)
Recently, however, industrial and
commercial redevelopment has
been gaining in popularity with
operators, and an increasing pro-
portion Of federal and local funds
is being directed to that phase OF
the program. The obvious moral
question: Is urban renewal a meth
cd by which slums are to be re-
placed with new middle-income
housing, or is it a publicly fin
anced gold mine for real estate
operators?
The Financing Formula
A closely related question con-
Germs the method of public fin
ancing. For the first IL years the
formula in use called for the local
public agency to pay one-third of
the projects net cost, the federal
government two-thirds. Although
many people objected to the added
cost Of paying the freight to ship
those dollars to Washington only
to have them sent back" the
formula was generally accepted on
the ground that only through use
of federal funds would it be posi-
BILE to mobolize the financial re-
sources needed to set in motion a
program of such massive proper
tons as the housing situation re-
quired. Many observers maintained
that on both moral and practical
grounds an even larger proportion
of the cost should be assumed by
the federal government.
In the 1861 housing act the
formula has been slightly changed.
AS more and more suburban COM
munities became interested in
urban renewal, it was obvious that
some communities could not fin
ance even one-third of the net cost.
Thus an amendment was added
which provides that in larger cities
the local agency shall continue to
pay one-third of the net cost,
while in suburbia (or in any city
with a population under 50,000)
the city will pay one one-fourth.
Thus those people who fled the
central city to escape its financial
and social problems are now being
offered the advantages of urban
renewal at a bargain price. In
effect the federal government has
set up a discount house for sub
urbanites interested in buying ur-
ban renewal while continuing to
charge the central city the full
list price. Is not this an ethical
question?
Is Slum Clearance Really the
Goal?
Far more significant, from a
moral perspective, than the fin
ancial question (though perhaps
less spectacular) are others raised
by the urban renewal process.
Take the selection Of areas for
renewal. The original program was
devised and approved by Congress
as a means Of eliminating the
worst residential sluns. Today, a
little more than a decade later,
we find those slurns being by
passed and the emphasis placed on
urban renewal as a means by
which the tax base of the COM
munity may be enlarged. Instead
Of using objective criteria for de-
termining the worst slum areas as
sites for the next renewal project
planners more often select areas
which promise to attract the big
gest capital investment. Thus the
profit motive Of the redevelopel
is combined with the tax-consci-
BUSINESS of local officials in de-
termining which areas of the city
are to be renewed-a far cry from
the original intention on the basis
Of which the program was sold tc
Congress and the electorate.
Or take the matter of citizen
participation, an integral element
in the mandatory seven-point
workable program" to be submit,
ted before a community can un.
dertake urban renewal: it has be.
come pretty much Of a dead letter
in many cities. All too often the
real decisions are made by a select
group Of self-appointed business
leaders and promoters who bring
to city hall a proposal which prom.
ises to clear some substandart
buildings (at least enough to quail,
ify for federal matching fInds), tc
increase the city's tax base, ant
incidentally to line the pockets Of
the shrewd redeveloper. Once the
approval of city officials is secur.
ed, the only real remaining OBJ,
stacle Is the federal urban renewal