Community Development and Policy Studies Update

In Community Development and Policy Studies (CDPS) field work throughout the Seventh District, CDPS contacts – in varying contexts – have voiced concerns about conditions impacting low- and moderate-income (LMI) populations and communities. CDPS conducts regular surveys of people representing organizations that serve LMI communities in varying ways. Our survey respondents represent organizations in the fields of: real estate development; finance; financial counseling; economic development; banking; consumer advocacy; small business development; philanthropy; law; higher education; agriculture; manufacturing; and human services. This blog is a summary of responses from the latest CDPS survey.

As indicated by the graph below, respondents in the most recent survey believe that many institutions are involved in leading to community development efforts in their region.
Click to enlarge
Click to enlarge

It is important that a wide array of institutions is helping people build the skills that are needed in the workforce, because most contacts noted that this continues to be an issue in their respective markets. Contacts noted that this issue could arise from a variety of circumstances including: (1) a dearth of students choosing science-based subjects in school; (2) lack of basic writing skills; and (3) too many students without a high school diploma. While community colleges cannot directly address all of these issues, according to almost all contacts, they are stepping in to tailor curricula to align with critical jobs skills in demand by (local) employers address these issues by: (1) identifying high demand local/regional employer skills; (2) focusing on developing critical thinking skills and improving communication skills; and (3) collaborating with other organizations. One example of collaborating with other organizations would be Milwaukee’s Green Skill Project that wrapped up this summer. It brought together industries, a technical college, community-based organizations as well as public and private funders. The program also partnered with Jobs for the Future to win a U.S. Department of Labor Green Jobs Innovation grant award.

The Federal Reserve Bank of Chicago is engaged in the workforce development discussion and is hosting a conference, Future Focus: Preparing for Workforce 2020, on February 19, 2015. The conference will be held in conjunction with The Center for Governmental Studies at Northern Illinois University. The one-day conference is designed to promote cross functional collaboration to support decision-makers and practitioners in identifying and implementing future-focused workforce development strategies. Attendees will learn more about the latest research and information on workforce trends, policies and practices. Please look for registration on ChicagoFed.org in January 2015.

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From classroom to career: An overview of current workforce development trends, issues, and initiatives

By Emily Engel and Daniel DiFranco

Community Development and Policy Studies’ (CDPS) most recent Profitwise News and Views (PNV) entitled, “From classroom to career: An overview of current workforce development trends, issues, and initiatives,” derives from CDPS’ Industrial Cities Initiative (ICI). Since workforce development was the most common and the most vexing issue identified by leaders in every ICI city profiled in the report, CDPS decided to examine the issues in greater depth. This PNV issue has four main articles and four insets, each revolving around a different aspect of workforce development:

  1. “Employment polarization and its discontents: A tale of two tails” describes the steady replacement of middle-wage (and presumably middle-skilled) jobs by low- and high-wage jobs.
  2. “Is there a skills mismatch: A technical view” reviews the term mismatch.
  3. “Employer involvement” describes employers’ efforts to address what they see as a skills gap.
  4. “Is a college education worth the cost? A risk/reward perspective” examines the puzzling trend of slowdowns in educational attainment despite rising demand for high-skilled workers.
  5. “Integrated Postsecondary Education Data System” describes the strengths (and limitations) of a dataset well suited for tracking educational outcomes among postsecondary institutions.
  6. “Skills for a stronger middle class” gives an example of how the executive branch is getting involved in workforce development.
  7. “The Cara Program: Workforce development one life at a time” highlights a Chicago-based community organization that provides a persistently challenging — yet highly supportive — environment within which individuals may cultivate the soft skills necessary for navigating the modern workplace.
  8. “Second chances in the land of opportunity” details a smaller Cara program that focuses on formerly incarcerated individuals, since the barriers to employment this group faces are often so high.
  9. “Early childhood education: ‘Workforce development’ for the long run” highlights the work of advocates to bring early childhood education into the policy spotlight.

The Chicago Federal Reserve is not the only Reserve Bank that is focusing on this important topic. Workforce development is guiding community outreach efforts across the Federal Reserve System. The Kansas City and Atlanta Feds cohosted a conference entitled, “The Future of Workforce Development: Where Research Meets Practice,” in September 2012. They recently extended this discussion in a similar conference entitled, “Transforming the U.S. Workforce Development Policies for the 21st Century.” In the same vein, the Philadelphia Fed spearheaded efforts to convene community development professionals, academics, and leaders from the public and private sectors in a “Reinventing Older Communities: Bridging Growth & Opportunity” conference held in May 2014, an event co-sponsored with seven other Federal Reserve Banks – Atlanta, Boston, Chicago, Cleveland, New York, Richmond, and St. Louis.

Please read the 2014 Fall PNV Edition to learn more about system efforts regarding workforce development, as well as current trends, issues, and initiatives on the topic.

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Healthy Communities – Milwaukee

By Steven Kuehl

Building off the 2013 Healthy Communities Chicago Regional Summit, the Federal Reserve Bank of Chicago will be cohosting a conference, “Healthy Communities – Milwaukee,” on December 2, 2014, that explores the converging visions of community and economic development, public health, and the public safety/criminal justice system. This conference is part of the Healthy Communities Initiative[1] created by the Federal Reserve System and the Robert Wood Johnson Foundation. This initiative, under the leadership of David Erickson from the Federal Reserve Bank of San Francisco, raises awareness about research indicating that people who live in supportive, socially connected, and economically thriving communities tend to be healthier[2]. Erickson has proffered that community development finance provides, through various interventions designed to improve local conditions, the opportunity for otherwise disenfranchised populations to engage in their local ecnonomies, access critical services, and therby become more healthy productive citizens. Neither the economic nor health impact of these interventions are easily measured, but strong correlations between social/economic and physical health across large populations support the argument for improving conditions through this work[3].

However, unique to the Milwaukee gathering will be an exploration of the intersection of the community development field with the public safety/criminal justice system in order to secure positive public health outcomes. 

In Milwaukee, many concerned with the long-term welfare of the city want to explore linkages between public health, safety, and economic conditions. The district attorney and Wisconsin State Public Defender’s Office have long recognized that the individuals in the criminal justice system disproportionately come from communities with high rates of infant mortality, teenage pregnancy, lead and other environmental toxins, and communicable diseases. Further, many of residents of these communities also often suffer from chronic mental illness and/or substance abuse issues, which leads them to incarceration for minor, non-violent crimes. Many of these negative outcomes are driven by environmental factors, such as poverty, failing schools, unemployment, racial isolation, etc. These factors are commonly referred to as the social determinants of health.

More than $1 billion has been spent through various federal, state, county, and city programs over the past 10 years in Milwaukee’s low- and moderate-income neighborhoods. Despite this investment, socioeconomic condtions in these communities has not improved.

Erickson, while visiting Milwaukee in April, stated that Milwaukee is uniquely positioned among American cities; among other assets, it is small enough that all the representatives of key community resources know one another. This fact alone increases the odds for aligning resources and expectations toward productive policies and programs.

In Milwaukee, many concerned with the long-term welfare of the city want to explore linkages between public health, security, and economic conditions. The District Attorney and Wisconsin State Public Defender’s Office have long recognized that the individuals who disproportionately populate the criminal justice system come from communities highest in infant mortality, teenage pregnancy, and with (evidence of) lead and other environmental toxins, failing schools, and high rates of communicable diseases. Additioanlly, others who enter the criminal justice system suffer from mental illness and addiction. 

In response, court systems have begun to implement specialty courts like Drug Treatment, Veterans, Mental Health, and Alcohol to treat a broader spectrum of responses to problematic behavior. The recent advent of evidence-based practices has enabled courts and corrections to collect statistically valid information about every individual entering the system. This information permits a robust, data-driven analysis of subpopulations entering the criminal justice system. 

What has become increasingly clear is that persistent, complex community problems in Milwaukee – poverty, poor health, incarceration – cannot be solved by agencies or sectors working in isolation. Greater alignment and collaboration is needed among institutions relative to the deployment of resources and strategies if significant change and improvement is to occur. To establish the groundwork for the December 2nd Federal Reserve Bank of Chicago cosponsored conference, a series of community conversation “cafés” are being held in Milwaukee throughout October. The purpose of the cafés is to ensure that the conference and its follow-up activities reflect and address the perspectives and concerns of people from different sectors of the community.

The December 2, 2014, conference will bring together professionals from community and economic development, public health, the criminal justice system, and philanthropy to shed light on the social determinants of health and explore community-based models and strategies that address the socioeconomic conditions of a place through evidence-based practices. The agenda will be constructed, in part, from the outcomes of the cafés. A major component will be to connect emerging data about criminal justice system subpopulations with work being done in the fields of community and economic development and public health. The conference goal is to engage the whole community in a conversation on how different sectors can work together more effectively to make Milwaukee safer, healthier, and more prosperous. Additionally, appropriate follow-up activities that continue to shape new solutions will be discussed and planned.

Please visit the website for further information and to register for the conference on December 2.

 


[1]The Healthy Communities Initiative was designed to enrich the debate on how cross-sector and place-based approaches to revitalize low-income communities might both revitalize neighborhoods and improve health.  The Federal Reserve System and the Robert Wood Johnson Foundation created the Healthy Communities Initiative to encourage stronger linkages between the two sectors and move them forward towards a healthier future.  Please visit the Healthy Communities Initiative website for more information. 

[2] David Erickson, et al., 2009, Community Development Investment Review, Volume 5, Issue 3.

[3] Ibid.

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CDPS Update

In Community Development and Policy Studies (CDPS) field work throughout the Seventh District, CDPS contacts – in varying contexts – have voiced concerns about conditions impacting low- and moderate-income (LMI) populations and communities. CDPS conducts regular surveys of people representing organizations that serve LMI communities in varying ways. Our survey respondents represent organizations in the fields of: real estate development; finance; financial counseling; economic development; banking; consumer advocacy; small business development; philanthropy; law; higher education; agriculture; manufacturing; and human services. This blog is a summary of responses from the latest CDPS survey.

As indicated by the chart below, contacts believe that many issues impact the single family (1-4 units) housing market in their region. Some contacts explained that lenders are finding the new rules and regulations too cumbersome to continue lending at the same rate as before the recession. However, many home owners are still underwater and there is little home buyer demand given: job losses; wage stagnations; neighborhood deterioration; and vacant homes that blight many LMI communities.

September Blog ChartClick to enlarge

In the rental market, there were mixed comments, depending on the area the contact was describing. In stronger markets, where new rentals have recently come on the market, occupancy and rents are high. However, in LMI areas, occupancy rates are lower and rents are more affordable.

Many contacts also mentioned in open ended questions that the housing market (e.g., vacant building and foreclosures), in conjunction with employment issues (e.g., high unemployment and low wages), are still two of the biggest challenges to sustained growth/revitalization in their communities.

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CDPS hosts a conversation on apprenticeships in manufacturing

By Jason Keller

According to the U.S. Department of Labor’s Employment and Training Administration (ETA), registered apprenticeship, a model for preparing new generations of skilled workers that can be traced back to the Middle Ages, remains an important method for training and placing workers. The current surge in apprenticeship has evolved from emphasizing learning in the traditional construction trades toward a focus today on new and emerging industries, such as energy, health care, and information technology for example. Today’s apprentices are registered in “earn and learn” work programs with expert mentors in their fields, allowing them to accumulate knowledge and build skills over time. The apprentice benefits by earning a fair wage as well as obtaining industry-recognized credentials and/or college credits. The 150,000 employers and other labor management organizations who already participate in the program also benefit because apprentices are not only placed on a structured learning track, but the industry-based training is specifically designed to meet employers’ current standards and practices. The various programs also have the capacity to track trends in demand, deploy resources, and match workers according to need. The success of apprenticeships’ on-the-job learning, combined with related technical instruction, leads toward a more highly skilled and highly productive workforce.

The Federal Reserve Bank of Chicago has long been interested in employment conditions as it seeks to promote the Fed’s dual mandate of maximum employment and sustainable economic growth.[1] For example, in 2011, Community Development and Policy Studies (CDPS), a division of the Chicago Fed, launched its Industrial Cities Initiative.[2] Known as ICI, this study took a closer look at ten former industrial/manufacturing hubs and their economic evolution over the last 50 years. The ICI paid particular attention to the labor force in these cities and the steps taken by local leaders, community colleges, and other labor organizations to meet demand for vocational and technical training by major employers.

In April 2014, the White House announced that the United States Department of Labor (DOL) will make $100 million in existing H-1B funds[3] available in the form of American Apprenticeship Grants. Expected to launch in the fall, this will be a competitive application process to award grants to partnerships that help American workers participate in structured apprenticeship programs. The grants are intended to encourage new apprenticeships by incentivizing employers, labor organizations, and training providers to work cooperatively. Awards are also intended to promote apprenticeships as pathways for further learning and career advancement, as well as to bring-to-scale exemplary models that work.[4]

To better inform the business and civic communities about this renewed commitment to the apprenticeship model and solicit feedback, the DOL worked with local intermediaries to hold a series of industry roundtables across the country throughout the month of June. The meetings brought together local leaders, employers, and labor organizations each with a vested interest in workforce development. The sessions were segregated by cluster: transportation and logistics (Atlanta), health care (Boston), construction (Washington DC), energy (Houston), and information technology (San Francisco).[5] The session held at the Federal Reserve Bank of Chicago on June 19 focused entirely on manufacturing by bringing together nearly 100 policymakers and practitioners on the topic of apprenticeship.

At the Chicago roundtable, Labor Secretary Thomas E. Perez[6] explained that the apprenticeship model is a “linchpin” and a “catalyst” toward sustainable economic vitality and job growth in this country. His remarks set the stage for an informative discussion on the needs, challenges, opportunities, and solutions for using apprenticeships in both traditional and advanced manufacturing.

Roundtable attendees were asked to comment on the following questions:

  • What are your current and future talent needs?
  • How can registered apprenticeships meet those needs?
  • What are the challenges to using registered apprenticeships?
  • What innovative solutions could be expanded and replicated?
  • What support is needed to advance registered apprenticeship efforts?

Results from the June roundtables will help the DOL determine if current federal policy pertaining to apprenticeship programs is effective or if additional enhancements are needed.

The Federal Reserve Bank of Chicago appreciated the opportunity to engage with the DOL in this important discussion. For more information on CDPS, please visit the Community Development & Policy Studies home page.[7] Additionally a recent ProfitWise News and Views article, Community Colleges and Industry: How Partnerships Address the Skills Gap[8] provides more information about community college and industry partnerships in the Seventh Federal Reserve District states of Iowa, Illinois, Wisconsin, and Michigan.


[1] See the Federal Reserve System mission statement, available at http://www.federalreserve.gov/aboutthefed/mission.htm.

[2] See the Federal Reserve Bank of Chicago’s Industrial Cities Initiative, available at http://www.chicagofed.org/webpages/region/community_development/community_economic_development/ici/ici_profiles.cfm.

[3] H-1B funds projects that provide training and related activities to workers to assist them in gaining the skills and competencies needed to obtain or upgrade employment in high-growth industries or economic sectors.

[5] American Apprenticeships: Industry Roundtable, available at: http://www.doleta.gov/oa/pdf/industry-FS-4.pdf.

[6] Thomas E. Perez biography, available at: http://www.dol.gov/_sec/.

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Redefining Rustbelt: Opportunities for city revitalization and educational reform

By Robin Newberger and Maude Toussaint-Comeau

The fourth and final meeting in the Redefining Rust Belt series among the Federal Reserve Banks of Chicago (Detroit branch), Richmond (Baltimore branch), Philadelphia and Cleveland brought together public school superintendents to discuss the central role that quality schools play in making urban communities stronger.[1]  (For more information on the initiative, please visit Redefining Rust Belt.)  The role of public schools as institutions in community development is well recognized.  Schools employ local residents, impact local housing markets, and influence the aesthetic character of a community (Chung, 2005). The educational system also helps determine the quality of the labor force and, therefore, the health of the local economy (Weiss, 2004). When experts in metropolitan redevelopment are asked what things are most important for metropolitan regions in the United States to be considered “world-class”, the issue that consistently tops the lists is having an educated workforce capable of adapting to changes in the economy. 

STRUGGLING SCHOOL SYSTEMS AND AN INCREASED “ACCESS GAP”

In the cities represented at the final “Redefining Rust Belt” session (Detroit, Philadelphia, Baltimore and Toledo[2]), superintendents spoke of common longstanding challenges to their school systems.  Each has wrestled with financial instability, declining enrollment, and uneven educational opportunities across their districts.   An emergency financial manager has led Detroit public schools since 2009.  Each of the cities has had to close buildings due largely to the migration of students to charter and suburban schools.  On average, about 65 percent of students graduate in four years from these school systems, according to the superintendents.  Among male Latino and black students, fewer than half graduate in four years. (See Chart 1 showing trends in the number of students enrolled by charter and non-charter schools).

Chart 1 educationClick image to enlarge

Source: U.S. Department of Education, National Center for Education Statistics

Superintendents report a talent gap in the classroom as well.  Urban settings tend to be places with the most job openings, but they are often the places with the most challenging environments in which to teach.   Some of the school districts rely on recruits from Teach for America to fill these positions, requesting hundreds of teachers per year.  But superintendents also recognize the importance of teachers having years of experience in difficult classrooms.  What is missing, according to the superintendents,  are “prep” programs designed to give new teachers apprenticeship opportunities to build an effective inventory of interventions from which to troubleshoot, regardless of where teachers are placed.  

More generally, there is an “access gap” across different neighborhoods and schools.  Every school system represented in the panel has some extremely high-quality schools, but not enough seats exist at those schools to accommodate every student who wants to be there. While some schools may offer college-level courses starting in 9th grade, other schools may not even have an honors class.  Open enrollment policies allow students to attend schools outside of their neighborhood boundaries, but students often have no means of transportation to travel farther distances. The gap in resources between different communities affects teachers, curricula and facilities, as well as an untold number of opportunities outside of the classroom. 

An additional challenge to neighborhood stability comes with the closure of school buildings.  Half of Detroit’s public schools were closed between 2011 and 2014. Philadelphia closed 31 schools over an 18 month period.  The closing of school buildings constitute one of the biggest sources of blight across neighborhoods (see Chart 2).

Chart 2 educationClick image to enlarge

Source: U.S. Department of Education, National Center for Education Statistics

RESPONDING TO THE CHALLENGES

School systems are attempting to address these challenges in a variety of ways.  

Attract quality teachers:

Districts are rethinking the opportunities for high-performing teachers, developing housing for new teachers who come into a district, and attempting to brand their localities as exciting places to work for people interested in teaching in the K-12 environment.  School systems are looking to provide employer-assisted housing not just for teachers but for other talent related to the education sector as well. Another approach to retain the most qualified teachers has been to suspend teacher seniority rules. One school district recently filed a petition with the state Supreme Court to get clarification of the School Reform Commission’s powers in this regard.  According to the superintendents, the goal is to bring and retain the most talented teachers for the benefit of schools that need the most support. Schools are also looking to reinforce relationships between teachers and students.  One district eliminated the grade 6 through 8 middle school institution and instead created a K-8 environment in all schools.  The same district started a program to bus fifth and sixth grade students to high school for music and band/orchestra, and seventh and eighth graders to high school for advanced credit, so that these elementary school students develop relationships with teachers in high schools they will eventually attend.

Provide a unique educational experience and ease the transition to higher education:

School systems are looking to adopt models that provide students with unique educational opportunities.  These include project-based schools where the curricula focus on real-world problem-solving in their communities, and school “boutiques” that specialize around the types of industries in which students want to work. School districts are also seeking to build support for students transitioning from high school to community college.  One superintendent reported offering courses for credit at the community college.  Another district has instituted a pilot program for high school seniors to take the same remedial courses in math, English and writing that they are often required to take during their first years of community college. The purpose is to make it easier for students to pursue a two-year degree, prevent them from getting lost when leaving high school, and lessening the need for financial aid for courses that do not count for credit.  An increasing number of external institutions are also helping to develop learning environments that create a continuum between classrooms and industry.  The Toledo school system hired someone from the Chamber of Commerce to act as a liaison between industry and classroom for the industries that are looking to connect with high-school graduates.  In Philadelphia, the superintendent’s department has an office of strategic partnerships that operates as a point of entry for individuals, businesses, philanthropies, and others to support the work that schools are doing.  Detroit has full-time staff to manage the entities interested in getting involved with the school system. 

Improve quality of life through repurposed school buildings:

School districts are using many of the closed school buildings to improve the quality of life and the quality of neighborhoods for people who live in the surrounding communities. In 2013, the Detroit school system selected 21 sites to serve as “community schools” that house programs such as job skills training, child/elder care, financial literacy and other programs that are offered beyond the traditional school day.[3]  The Detroit mayor is working with school principals to encourage families to move to promising neighborhoods – neighborhoods that have experienced blight but have potential for improvement given their high-quality housing stock. The school systems are looking to convert other unused school buildings into housing for the parents of school-age children, as well as for professionals and businesses in these neighborhoods.  Leveraging New Markets Tax Credits and Historic Tax Credits, some districts have converted closed schools to senior centers.  The Detroit superintendent’s office has been working to turn a shuttered high school into a farm and food processing center for school programs and a farmers market (Eastern Market) in downtown Detroit.

SUMMARY AND CONCLUSION

According to the superintendents who participated in the panel discussion, there isn’t a one-size-fits-all theory of action to implement reforms.  The challenges that schools face stem not only from the classroom but, in many instances, from circumstances that students face at home.  School systems, therefore, recognize the need to develop students from early pre-school stages through the K-12 system.  Perhaps most importantly, school districts must embrace new approaches.  As the superintendents explained, that means on one level, creative reuse of buildings and other assets, sometimes leveraging government funding not traditionally targeted to schools for supportive services, and even converting vacant facilities to housing and other non-educational purposes to avert blight and decay of vacant schools and surrounding neighborhoods.  On another level, it means expanding the process of articulation[4] from ensuring that coursework in elementary and middle schools prepares students for high school, to familiarizing students with facilities, faculty, and coursework at the high school level, and ultimately strengthening links to and coordination with employers.  From a labor standpoint, school districts are also working to broaden measures to attract good teachers, such as providing housing assistance, and placing less emphasis on tenure and more on performance.   Economic conditions are forcing school districts to redefine and expand their roles, and take unprecedented steps to ensure their viability while placing primary emphasis on student success.

References

Chung Connie, “Connecting Public Schools to Community Development,” https://www.bostonfed.org/commdev/c&b/2005/winter/Public.pdf

Jonathan D. Weiss, “Public Schools and Economic Development: What the Research Shows,” http://www.mea.org/tef/pdf/public_schools_development.pdf

 


[1]The meeting took place as a plenary session at the national conference “Reinventing Older Communities” in Philadelphia in May 2014.

[2] Detroit was represented by Jack Martin, Emergency Manager of Detroit Public Schools; Philadelphia was represented by William Hite, Superintendent of the School District of Philadelphia; Baltimore was represented by Gregory Thornton, Superintendent of the Milwaukee Public Schools and incoming CEO of Baltimore City Public Schools; and Toledo was represented by Romules Durant, CEO and Superintendent of Toledo Public Schools.  Toledo was represented instead of Cleveland in the final meeting of the series. However, all the charts in this blog reference Cleveland for consistency in the project.

[3] For more information, see DPS announces 21 schools to serve as “12/7 Community Schools” and hubs of their neighborhoods, available at: http://detroitk12.org/content/2013/08/15/dps-announces-21-schools-to-serve-as-127-community-schools-and-hubs-of-their-neighborhoods/

[4] Defined by the U.S. Dept. of Education as “systematic coordination of course and/or program content within and between educational institutions to facilitate the continuous and efficient progress of students from grade to grade, school to school, and from school to the working world.”

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Community Development and Policy Studies (CDPS) Update

In Community Development and Policy Studies (CDPS) field work throughout the Seventh District, CDPS contacts – in varying contexts – have voiced concerns about conditions impacting low- and moderate-income (LMI) populations and communities. CDPS conducts regular surveys of people representing organizations that serve LMI communities in varying ways. Our survey respondents represent organizations in the fields of real estate development; facilities financing; financial counseling; economic development; banking; consumer advocacy; small business development; philanthropy; law; higher education; agriculture; manufacturing; and human services. This blog is a summary of responses from the latest CDPS survey.

While the survey provides, by virtue of its nature and scope, more qualitative than quantitative insights, most contacts noted that in their communities many people lack skills that are needed in the workforce. Additionally, the contacts highlighted that community colleges are partnering with industry and non-profits to make sure they are customizing their curricula to correspond with skills sought by local employers. A recent ProfitWise News and Views article, Community Colleges and Industry: How Partnerships Address the Skills Gap provides more information about community college and industry partnerships in the Seventh Federal Reserve District states of Iowa, Illinois, Wisconsin, and Michigan.

On a different note, CDPS is interested in learning about the institutions in your community that create, lead, and finance community development. The two charts below break down which organizations create and lead community development and organizations that help to finance community development. Additionally, it was noted that Community Development Financial Institutions (CDFIs) and farm service agencies helped create, lead, and finance community development, respectively.

Chart one
Click image to enlarge
Chart two
Click image to enlarge
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Industrial Cities Initiative Profiled in New Report

Community Development and Policy Studies at the Chicago Fed recently published profiles of a group of 10 cities that experienced significant manufacturing job loss in recent decades.

The Industrial Cities Initiative (ICI) includes, Aurora and Joliet in Illinois; Fort Wayne and Gary in Indiana; Cedar Rapids and Waterloo in Iowa; Grand Rapids and Pontiac in Michigan; and, Green Bay and Racine in Wisconsin.  While each city has been blogged about before (see the “BLOG” tab), a complete set of more detailed profiles are now compiled into one report.

Collectively, the profiles provide insights from local economic development leaders on the cities’ actions in the wake of the job loss that have either helped or hindered redevelopment efforts.

The authors and contributors to the ICI do not pass judgment on individual cities. So, while we understand the temptation to simply link directly to just one city’s profile, we encourage readers to start their exploration of the ICI with the Summary.

The ICI looked at cities’ conditions, trends and experiences and concluded that efforts to improve their economic and social well-being are shaped by:

  • Macroeconomic forces: Regardless of their size or location, these cities are impacted by globalization, immigration, education, job training needs, demographic trends including an aging population, and the benefits and burdens of wealth, wages, and poverty;
  • State and national policies: State and national policies pit one city against another in a zero-sum competition for job- and wealth-generated firms; and
  • The dynamic relationship between the city and the region in which it is located: Regional strengths and weaknesses to a large extent determine the fate of the respective cities.

The ICI homepage provides access to the full ICI report, individual ICI city profiles and related research, and blogs from around the country about cities that share a manufacturing legacy.

Posted in Aurora, Cedar Rapids, Fort Wayne, Gary, Grand Rapids, Green Bay, Industrial Cities Initiative, Joliet, Pontiac, Racine, Waterloo | Comments Off

Final Blog in Three Part Series: Reflections from Community Leaders Forum

CLF

Below is the final of three blogs reflecting perspectives on the Fed’s Community Leaders Forum, which took place on March 5 and 6 in Washington, DC. Our guest bloggers in order of posting are Michelle Hoereth of IFF, Renee Hatcher of the Chicago Lawyers’ Committee for Civil Rights, and Sarida Scott of the Community Development Advocates of Detroit.

A key purpose of the Community Development function in the Federal Reserve System is to document trends, observations, and concerns of organizations serving consumers and communities. Information we gather informs our programmatic and research agendas. To that end, we invite perspectives of both newer and well-established private sector community development organizations, and build relationships with long-tenured, as well as emerging leaders in the field. 

The Community Leaders Forum, organized by the Federal Reserve Board of Governors and the Federal Reserve Banks of St. Louis and Chicago, was a dialogue with emerging leaders, and we are grateful for their participation and thoughtful input. The goals of the forum were to:

  • Strengthen the community development function through peer-to-peer learning that promotes applied research and innovative community strategies; and
  • Improve the Federal Reserve’s understanding of emerging trends and their impact on consumers and communities, in particular those traditionally underserved.

By Sarida Scott

In March, the Federal Reserve Board convened a Community Leader’s Forum, the second of four, in Washington, DC. This session brought together representatives from cities like Detroit, Chicago, St. Louis and Memphis to talk about current community development issues and how Federal Reserve resources can be used to support work on the ground.

As the Detroit representative, the experience was beneficial in a variety of ways. Despite participating in a number of educational and informational sessions held by the Fed in Detroit, I was not aware of the extent of the Fed’s involvement in community development. It is helpful to have an understanding of the various ways in which the Fed connects with communities, which includes conducting policy analysis and producing research papers. This fact suggests that there are additional opportunities to connect with the Fed and influence activities designed to support the industry.

The other significant benefit was the opportunity to network with community development professionals from other cities. Hearing the stories of the challenges and of various solutions being employed provided great insight. While it was a reminder that our challenges in Detroit with respect to vacant property, blight, and development are on a significantly larger scale, it was at least comforting to know that we are utilizing or have tried solutions that are also being used by our counterparts. The conversations also sparked ideas for new efforts and initiatives. Of interest were the collaborative projects discussed that pull in different and sometimes unexpected partners in ways that are having great impact in neighborhoods.

Current challenges in Detroit include an overwhelming number of vacant properties and the accompanying blight issues. Faced with an inventory of approximately 70,000 vacant structures, there is no simple resolution to the problem. While funds have been funneled to the city from the federal government and other entities for demolition, that alone will not solve the problem. Recognizing that demolition is necessary in many cases, residents and organizations also continue to seek funds for home rehab and deconstruction work to preserve what is still a beautiful housing stock. Despite the demand and interest, these types of funds prove difficult to attract.

Additionally, engaging in a significant amount of demolition will result in enormous amounts of vacant land, land that will need some level of development. In a challenged city, one already facing bankruptcy, that level of development will be difficult to achieve.

Despite these stark facts, we are hopeful in Detroit. There is investment. There is great support from philanthropy. There is new leadership in the form of a mayor and for the first time in 100 years, a city council by district. And there is the community development industry that has remained committed to supporting neighborhoods and improving quality of life.

As the executive director for the community development trade association in Detroit, participation in the Federal Reserve Board’s Community Leaders Forum was an excellent opportunity to be exposed to new ideas and resources for our work. We look forward to continuing and fostering this relationship.

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Redefining Rustbelt: Mitigating Blight and Managing Vacancies in Detroit, Baltimore, Cleveland, and Philadelphia

By Robin Newberger and Maude Toussaint-Comeau
The Federal Reserve Banks of Richmond, Cleveland, Philadelphia, and Chicago-Detroit Branch recently held a videoconference on “Land Use Planning: Aligning Investment with Vision” to share strategies related to blight mitigation, the management of vacant land and the development of commercial corridors. This was the third exchange between experts and stakeholders in a series between the four cities on strategies to attract residents and investments.
Each of the cities represented at the videoconference has confronted high numbers of foreclosed and abandoned homes and commercial vacancies that have resulted in widespread blight. Data from the US Postal Service (charts 1 and 2) shows little improvement in vacancy rates in these cities since 2011. For Detroit, the rate of residential vacancies is four times that in the US, and the rate of commercial property vacancies is more than double the national rate. Strategies to address abandonment, blight, and declining commercial corridors as such have been integral to these cities’ efforts to stabilize population and attract investment. The videoconference discussion focused on five particular land use strategies.
Chart 1
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Chart 2
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Source: USPS, downloaded through HUDUSER
Five Elements of a Comprehensive Approach to Land Use Strategies
(1) Data collection
Data collection and consolidating information allows cities to be more systematic about removing blight. It gives city agencies information about where to target abatement actions. A better understanding of the inventory also makes it easier to acquire privately-owned, tax-delinquent properties to assemble larger tracts that can be repurposed and redeveloped. Some specific efforts noted during the videoconference included:
• The Blight Task Force, in Detroit, which has organized teams to photograph parcels and document the characteristics of each property. This work is helping to develop a systematic and sustainable blight-removal framework for the city.
• A city of Cleveland program, through which the Cleveland fellows have developed a framework that prioritizes properties for demolition based on predetermined neighborhood- and property-specific factors. Relevant property data is fed into a transparent process for determining demolition priorities.
• A city of Philadelphia program, under the Philadelphia Redevelopment Authority, that makes vacant lot prices available to the public and publishes disposition policies on how to buy (in some cases, discounted) city-owned property.
• A Baltimore city contract with TRF (the Reinvestment Fund) for a market value analysis that helps the city understand its market dynamics and develop strategies to rebuild and stabilize distressed real estate markets.
(2) Zoning ordinances
All the cities have established some form of compliance-based code enforcement for abandoned property. The city of Philadelphia was noted for its successful anti-blight zoning ordinance. An analysis of the anti-blight initiative found that places where targeted enforcement took place had property sale prices roughly 30 percent higher on average, and fewer tax delinquencies, than places where no intervention of this type occurred.
(3) Land banks
Land banks allow the public sector to remove excess supply from the market, which in turn helps to stabilize property values. Land banks can also facilitate better analysis of where aggregating parcels can have an impact on neighborhood stabilization, which can accelerate overall real estate market revitalization compared with strategies involving piecemeal transfer or sale of land. Over the course of the meeting, representatives discussed various issues pertaining to the pros and cons (such as the added costs of property maintenance), and noted the following:
• The Cuyahoga County land bank (Cleveland) is one of the largest and, based on the volume of acquisition, demolition, and redevelopment (and other factors), most effective land banks in the country.
• Several land banks in the Detroit metro area are in the process of being merged together.
• Philadelphia passed legislation for the creation of a land bank in December 2013. The Philadelphia land bank will offer a streamlined process to people who apply for property, in contrast to the various agencies that follow different policies and systems for land acquisition and re-use.
(4) Green spaces and “un-development”
Traditionally, cities have viewed open spaces as public amenities and potential gateways to improve the appeal of neighborhoods. More recently, cities are relating open spaces to environmental sustainability. Cities that have lost substantial population have come to look at city landscapes from an ecological perspective, pursuing so-called “un-development” strategies that derive value from land otherwise perceived as unproductive. The aim is to transform open spaces for uses like storm water management and urban agriculture. Representatives discussed and highlighted some of the initiatives and issues related to green space:
• Baltimore’s Parks and People Foundation piloted an urban forestry initiative in the 1990s with help from the US Forest Service.
• More recently, the city of Cleveland moved from the practice of holding onto residential parcels (in their land bank) to selling to developers, and encouraging home owners to expand side yards and double their residential lots, if adjacent vacant properties are not located in an area targeted for development.
• In Baltimore, the city’s Office of Sustainability in the City Department of Planning developed the “Growing Green” initiative, which focuses on reusing vacant land, including the greening of neighborhoods. The Green Pattern Book, spearheaded by this same office, serves as a guide to encourage the planning and implementation of different green uses for vacant land.
• Economic developers in Detroit are also developing an environmental plan in conjunction with their blight remediation and demolition strategy.
(5) Business corridor development
The development of neighborhood business corridors is another strategy that cities are pursuing to mitigate blight. Some of these strategies cover multiple neighborhoods, involving investments in transportation routes to connect otherwise marginal areas with the economic hubs of a city. Cities are also deploying corridor strategies in middle market areas, where attention to a few storefronts is intended to shift the market trajectory for the surrounding neighborhood. Neighborhoods with unique architecture or historic character are also targeted for business corridors. These places can encourage creativity and provide a sense of “fun.” Developers hope to attract artists and a mix of tenants into these neighborhoods. Some of the discussions noted the following:
• Cleveland has invested in streetscape and in bus rapid transit to better connect businesses. It has reconfigured portions of West Shoreway freeway into an urban parkway, offering opportunities for the development of vacant land. Another project, “Opportunity Corridor,” connects impoverished parts of Cleveland to freeways and to the University Circle.
• In Detroit, Revolve Detroit at the Detroit Economic Growth Corporation is focusing on two business districts. New occupants include pop-ups and jury-selected artists.
• Philadelphia is working on corridor development to fill storefronts with a combination of art and retail.
• Baltimore looks to bring in restaurants and other food-based businesses to encourage visitors and newcomers to go into different neighborhoods.
Conclusion and takeaways:
With respect to any of the strategies discussed during the videoconference, participants emphasized the importance of getting input from community residents. Openness and transparency allow the community to feel ownership and participate in the process. Baltimore’s experience with large-scale demolitions in East Baltimore offers an example of successful community engagement. Its demolition protocol was developed as a collaborative effort that brought the local community into the entire process – from site demolition, to the cleaning-up of a brownfield, to the design of the first new school in Baltimore city in 20 years. In a similar spirit, the Detroit Economic Growth Corporation and Revolve Detroit have engaged neighborhood residents, local business owners, and property owners to build plans along designated business corridors.
A related message from the videoconference exchange was that blight elimination should be people-focused, and intended to improve the quality of life and bring about new opportunities for residents. The experience in the East Baltimore Revitalization Initiative underscores this point. Families relocated during that project moved into homes valued at considerably more than those they had vacated. These families, with the support of The Annie E. Casey Foundation, were provided an asset that could then potentially alter their lives for the better.
An overarching theme of the conference was that cities should make strategic decisions about where to demolish and redevelop, but also put in place programs and policies to encourage overall economic redevelopment. These include improvements in education, job training, and job creation, organically or by attracting and incenting employers.
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