URBAN REVITALIZATION IN CLEVELAND: A CASE STUDY ON CLEVELAND’S EMPOWERMENT ZONE INITIATIVE 1994-2004 By BENJAMIN ELI DEMKO Submitted in partial fulfillment of the requirements For the degree of Master of Arts Academic Advisor: Dr. David C. Hammack Department of History CASE WESTERN RESERVE UNIVERSITY January, 2014 CASE WESTERN RESERVE UNIVERSITY SCHOOL OF GRADUATE STUDIES We hereby approve the thesis of Benjamin Eli Demko ______________________________________________________ Master of Arts candidate for the ________________________________degree *. David C. Hammack, PhD ______________________________________________ Marixa Lasso, PhD ________________________________________________ Rhonda Y. Williams, PhD ________________________________________________ 12/03/13 (date) _______________________ *We also certify that written approval has been obtained for any proprietary material contained therein. 2 TABLE OF CONTENTS Page LIST OF TABLES ...............................................................................................................5 LIST OF FIGURES .............................................................................................................6 ABSTRACT .........................................................................................................................7 CHAPTER 1. INTRODUCTION .........................................................................................................8 Statement of Purpose .............................................................................................10 2. THE CONCENTRATION OF POVERTY IN AMERICA’S INDUSTRIAL CENTERS ....................................................................................................................12 Cleveland a Short Economic History .....................................................................12 “The Urban Poverty Debate” .................................................................................16 Focus on the Culture, Behaviors, and Values of the Poor .........................17 Focus on Structural Explanations ..............................................................25 Focus on Politics ........................................................................................29 Sugrue ........................................................................................................34 “The Urban Poverty Debate” in the Application of Urban Poverty ......................37 3. THE FEDERAL EMPOWERMENT ZONE ...............................................................40 Background ............................................................................................................40 Resources Available for Designated Sites .............................................................42 The EZ’s Key Principles ........................................................................................45 3 4. CLEVELAND’S EZ APPLICATION AND ECONOMIC DEVELOPMENT STRATEGY .................................................................................................................47 Background ................................................................................................47 Cleveland’s Plan ........................................................................................50 Economic Development .......................................................................52 Public Transportation and Accessibility ..............................................53 Labor Force Development ...................................................................54 Community Building ...........................................................................56 Cleveland’s SEZ Designation ....................................................................57 5. IMPLEMENTATION ..................................................................................................58 6. OUTCOMES................................................................................................................67 7. CONCLUSION ............................................................................................................83 BIBLIOGRAPHY ..............................................................................................................84 4 LIST OF TABLES Table Page 1. The Urban Poverty Debate Summary…………………………….…………….........37 2. EZ Approaches to Revitalize Distressed Neighborhoods...……………..…..…...…..39 3. Funding of Cleveland’s SEZ Reported by Key Principle and Category…...................................................................................................................61 4. Funding Community Based Partnerships,,,,,,,……………………………..................65 5. Change in Black Population, SEZ and Comparable Neighborhoods, 1990- 2000………………………………….,,,,,,,……………………………….................73 6. Change in Unemployment Rate, SEZ and Comparable Neighborhoods, 1990- 2000……………………………..…...........................................................................74 7. Change in Households Receiving Public Assistance, SEZ and Comparable Neighborhoods, 1989-1999………………………………………………………….75 8. Change in Household Income, SEZ and Comparable Neighborhoods 1989- 1999…........................................................................................................................76 9. Change in Poverty Rate, SEZ and Comparable Neighborhoods, 1989-1999.............76 10. Change in Households with Self Employment Income, SEZ and Comparable Neighborhoods, 1989-1999……………………………………………....................78 11. Resident Representation (as a percentage of Board Members) on Cleveland's EZ Advisory Board by Year:…………………………………………......................82 5 LIST OF FIGURES Figure Page 1. Average Sales Price Single Family Homes (2000-2012)….…………….............72 6 Urban Revitalization in Cleveland: A Case Study on Cleveland’s Empowerment Zone Initiative 1994-2004 Abstract By BENJAMIN ELI DEMKO This paper offers a detailed case study of Cleveland’s 1994-2004 Empowerment Zone initiative (EZ), by examining how the program fit with the prevailing “urban poverty debate” narratives which sought to explain the emergence of concentrated poverty in America’s older industrial centers. Records show that while Cleveland’s Empowerment Zone proposal appeared to address certain aspects of the “urban poverty debate,” many important features of these narratives were either left out or not considered. In the end, the majority of funds available to Cleveland’s Empowerment Zone neighborhoods were used mainly for real estate development, as well as a few varied workforce development programs, and support for already-existing Community Development Corporations (CDCs). Data suggests that these efforts may have improved unemployment and poverty rates significantly; however they likely did little to alter the economic status of disadvantaged residents in relation to the region or decrease racial segregation. 7 CHAPTER 1 INTRODUCTION On May 2, 1992, Governor Bill Clinton delivered a lectern-pounding address to the Democratic Leadership Council in New Orleans, while 1,800 miles away Los Angeles burned. “Thomas Jefferson,” he proclaimed, “once warned that the crisis of slavery was a fire bell in the night. The crisis in Los Angeles is now our fire bell in the night.” He went on to suggest that while the Los Angeles riots were sparked by a single incident, namely the Rodney King verdict, they illuminated the breakdown of economic opportunity in the inner-city, and the isolation of residents, whom he called “the other America:”1 We have made a great deal of progress for those of us who live in the mainstream of America, but what has happened beneath that? Beneath that, there are those who are not part of our community, where values have been shredded by the hard knife of experience, where there is the disintegration of family and neighborhood and jobs and the rise of drugs and guns and gangs.2 People . are looting because they are not part of the system at all anymore. They do not share our values, and their children are growing up in a culture alien from ours, without family, without neighborhood, without church, without support.3 1 Ronald Brownstein, "Clinton: Parties Fail to Attack Race Divisions," Los Angeles Times, May 3, 1992. 2 Gwen Ifill, “The 1992 Campaign: Social Policy; Clinton Blames Bush and Republicans for Racial Turmoil,” The New York Times, May 3, 1992. 3 Brownstein, "Clinton: Parties Fail to Attack Race Divisions." 8 A Special Committee of the California Legislature seemed to agree with Clinton’s assessment that a certain segment of America’s urban population had become dangerously alienated from the “mainstream.” In a report entitled “To Rebuild is Not Enough,” they concluded that the riots stemmed in large part from inner-city segregation, lack of educational and employment opportunities, poverty, police abuse and unequal consumer services, all of which were “aggravated by a highly visible increasing concentration of wealth at the top of the income scale and a decreasing Federal and State commitment to urban programs serving those at the bottom of the income scale.” These conditions they argued, had led to a “cycle of despair” in which many inner-city residents found themselves trapped.4 When interviewed, residents themselves expressed feelings of isolation and alienation, fueled by what they perceived as racial and economic injustices. For example, a middle-aged woman interviewed by the L.A. Times stated, "It seems like no matter what you try to do, it's just in vain. Your color is your calling card.