Economic and Community Development: Comprehensive Study Guide

Role of Government in Community and Economic Development

• The role of local government in facilitating community and economic development is not uniform; it differs significantly from one community to another.
• Advantages of Government Involvement:     * Building/Updating Infrastructure: Government has the capacity to develop and maintain the physical foundations necessary for growth.     * Lower cost funds: Public entities often have access to financing at lower interest rates compared to private developers.     * Lower risks: Public involvement can absorb or mitigate risks that might deter private investment.
• Disadvantages of Government Involvement:     * Restrictions: Government action is often bound by complex legal, regulatory, and procedural requirements.     * Political: Development decisions are frequently influenced by political agendas and the needs of various constituencies.

Defining Community Development

• United Nations Definition: A process where community members come together to take collective action to generate solutions to common programs.
• Academic Approach for this Course:     * Community development is viewed as a sustainable process whereby the efforts of government work in coordination with residents to improve social, cultural, and economic conditions.     * The ultimate goal is to improve the quality of life and the general conditions within the community.
• Core Areas of Exploration:     * The professionalization of the community development field within both local and state government structures.     * The historical trajectory and patterns of how communities have evolved over time.     * Specific local efforts and case studies surrounding community and economic development within the state of Connecticut.

Theoretical Models of Community Power

• Elite Model: This theory argues that power is concentrated in the hands of a relatively small group of people. These individuals are typically top leaders from the business and financial sectors.
• Pluralist Model: This theory posits that power is widely dispersed. Different leaders are influential in different issue areas, and they respond to the wishes of various interest groups as well as individual voters.
• General Reality: Most actual communities do not adhere strictly to one model; instead, they fall somewhere in the middle of the spectrum between the Elite and Pluralist theories.

Case Studies in Local Governance: Atlanta vs. New Haven

• Atlanta Study (Floyd Hunter):     * Published in the study "Community Power Structure."     * Finding: No single person, family, or business dominated the city.     * Structure: Identified several tiers of community influentials. Business leaders consistently occupied the top tier.     * Process: Top decision makers met informally to reach conclusions and then passed those decisions to official government leaders for implementation.
• New Haven Study (Robert Dahl):     * Published in the study "Who Governs?"     * Finding: Discovered a polycentric and dispersed community power structure.     * Structure: Influence was exercised intermittently by many different individuals. Each person likely held power over a specific issue but lacked influence over others.     * Key Actor: The mayor was identified as the only decision maker with influence across most issues.

Economic Growth and the NIMBY Phenomenon

• The Necessity of Prosperity: Economic growth is required to protect the fiscal base of local government. The ability to maintain current services or expand them is often dependent on the growth of the local economy.
• Growth Attitudes: Not every community adopts a "pro-growth" stance. Local politicians frequently tailor their campaigns to reflect the specific local sentiment regarding expansion.
• NIMBYism: This is an acronym for "not in my backyard." It describes a situation where residents may support growth in concept but oppose any specific development located near their own residence.
• Common Targets of NIMBY Opposition:     * Waste disposal sites.     * Highways and transportation infrastructure.     * Prisons.     * Mental health facilities.     * Low-income public housing projects.     * Utility plants.     * Airports.     * Commercial developments.
• Mitigation Strategy: Governments and private corporations often launch professional public relations campaigns well in advance of a project's groundbreaking to minimize community opposition.

Historical Evolution: Urban Renewal

• Definition: Urban renewal refers to federally aided programs managed by local government agencies designed to rebuild blighted areas within central cities.
• Initial Implementation ($1937$): Early urban renewal was tied closely to public housing initiatives. Slums were demolished to make room for the construction of public housing sites.
• Housing Act of $1949$: This act shifted urban renewal toward a broader program of urban redevelopment. The goal was to help cities combat population loss and revitalize central business districts.
• Results: By the $1970s$, these large-scale federal programs were largely viewed as failures, as cities across the United States continued to experience decay.

Institutional Frameworks for Economic Development

• Governmental Objective: Local and state governments seek to encourage private investment to enhance property values and stimulate economic activity.
• Regenerative Entities: Responsibility for urban regeneration is often assigned to semi-autonomous organizations:     * Community Development Corporations (CDCs).     * Community Development Authorities (CDAs).
• Key Organizations in Connecticut:     * Mutual Housing Association of Greater Hartford.     * Hartford Economic Development Corporation (HEDCo).     * Capital Region Development Authority (CRDA).
• Municipal Staff: Many local governments employ dedicated economic development officials to focus specifically on community investment.

Strategic Tools for Economic Development

• Enterprise/Empowerment Zones:     * Initiated in the $1980s$.     * Targets: Areas with high poverty and unemployment.     * Benefits: Federal grants, tax incentives, loans, and technical assistance.     * Outcome: Assistance varies by location, and overall results have been mixed.
• Opportunity Zones: Created by the Tax Cuts and Jobs Act of $2017$. These use tax incentives to encourage long-term investment in distressed communities.
• Brownfield Remediation: Focusing on bringing economic vitality back to old industrial land that has been contaminated.
• Eminent Domain: The judicial process allowing government to take private property for public use provided they pay fair (just) compensation.

Eminent Domain and Kelo vs. City of New London

• Core Power: Local governments may "take" private property for public purposes, such as road construction.
• Case Background: ใน the mid-$1990s$, New London attempted to redevelop a neighborhood surrounding a proposed Pfizer facility to combat significant disinvestment.
• The Conflict: While most land was sold voluntarily, $7$ property owners refused. The city utilized its eminent domaine power to seize the property.
• Legal Challenge: Owners sued, claiming the taking was unconstitutional because the property was being transferred to another private entity.
• Supreme Court Ruling: The US Supreme Court ruled that private property could be condemned via eminent domain and used for economic development purposes, as this constitutes a "public use."
• Constitutional Reform: Following this ruling, many states amended their state constitutions to prohibit the use of eminent domain for economic development in the way it was used in New London.

Affordable and Public Housing in Connecticut

• Socio-Economic Context: Federal policies in the early-to-mid $20th$ century may have exacerbated racial and economic segregation; today, NIMBY attitudes often perpetuate these same patterns.
• Procedure Act of $1989$: Connecticut established specific procedures for developers, municipalities, and the court system to follow when a developer appeals a local board's rejection of an affordable housing proposal.
• CGS 8-30g Standards:     * Applies to municipalities where less than $10\,\%$ of the housing stock is deemed "affordable."     * In a court appeal, the burden of proof shifts to the municipality to provide sufficient evidence justifying the rejection of the affordable housing project.
• Implementation Obstacles: Although CGS 8-30g is a primary tool, it is frequently criticized for being a time-consuming and inefficient method for developers to increase the supply of affordable housing units.

Community Development Block Grants (CDBG)

• Origin: Created by the Housing and Community Development Act of $1974$, which consolidated various federal development grants into single block grants.
• Primary Uses: Local authorities use CDBG funds to acquire blighted land, clear or modernize obsolete/dilapidated structures, and prepare downtown sites for new development.
• Spending Mandate: No less than $70\,\%$ of the funds must be used for activities that benefit low- and moderate-income persons.
• Income Thresholds: Low- and moderate-income is defined as households with incomes not exceeding $80\,\%$ of the area's median income.
• Direct Eligibility Criteria:     * Local governments with at least $50,000$ residents.     * Central cities located in metro areas.     * Urban counties with populations of at least $200,000$.
• State-Level Allocation: The state of Connecticut receives approximately $\$13\,\text{million}$ annually, which is distributed to smaller localities that do not meet the criteria for direct federal aid.