First a brief news update. In a sad loss to the urbanist community, Jeremy Nowak, most recently the co-author with Bruce Katz of the book The New Localism, passed away of a heart attack last weekend.
In my City Journal article about Akron, I mention Mayor Horrigan’s plan to add 50,000 new residents to the city by 2050. City planning director Jason Segedy has a detailed article examining the plan and its rationale that you should read as it’s highly relevant to other post-industrial cities. Here are some excerpts:
A decade ago, the concept of “smart decline” began to gain serious traction in the post-industrial cities of the Rust Belt, particularly in places like Detroit and Youngstown.
The concept makes some theoretical sense. Nearly every economic and social trend in the United States since the 1950s has produced significant headwinds for the cities of this region. Many people believe that those trends are going to continue indefinitely. If you’re not going to grow, why not be realistic about your prospects, and begin to work toward mothballing infrastructure and relocating residents from declining neighborhoods?
There is an argument to be made that managed decline is a pragmatic approach to present-day economic realities. There is also an argument to be made that it is fatalistic, and that it can easily become a self-fulfilling prophecy. Things change. And regardless of whether Yogi Berra actually said it, “It’s tough to make predictions, especially about the future.”
It is refreshing to see city leaders fighting for the new housing that will help to revitalize and restore their neighborhoods. Akron’s Mayor Dan Horrigan, my boss, has established a bold goal of growing the city’s current population of 198,000 back to 250,000 by 2050. He unequivocally states that “I refuse to manage this city’s decline.”
The surfeit of vacant parcels is both a huge opportunity and challenge. The cost of simply managing, mowing, and maintaining these properties can be daunting, especially for cash-strapped local governments with fiscal difficulties of their own. As such, cities have ample incentive to get these properties into private hands, whether those be the hands of next-door neighbors, community development corporations, or real estate developers.
In many Rust Belt metros, there is an oversupply of housing in the regional real estate market. Northeast Ohio is a textbook example of this. This 12-county region of nearly 4 million residents, containing Cleveland, Akron, Canton, and Youngstown, has lost 7% of its population since 1970, yet it has seen massive suburban sprawl, with an additional 250 square miles of land developed for residential use over that same period. The oversupply of housing, coupled with low overall demand, leads to depressed home values, and contributes to vacant housing in the core cities, as middle-income buyers filter from older to newer housing.
But this isn’t a complete picture. While there is an oversupply of housing in the region, there is an undersupply of saleable housing in the urban market. A scrapyard technically has a large supply of cars, but none of them are drivable. A similar situation exists in the urban housing market. All of the high-quality older homes, in the desirable neighborhoods, are already occupied and cared-for, leaving behind a large stock of defunct and obsolete vacant housing which no one wants, that is slowly rotting away.
When houses begin selling for less than $50,000, they have essentially reached the point where it is no longer worthwhile to maintain them. No one is going to buy a house for $10,000, and put $60,000 into renovating it, only to have it sell for $40,000. A $10,000 house is not an asset. It is a liability.
In order to unlock latent demand for urban living, the first thing that a city needs to do is to increase the supply of marketable housing. In Akron, we have tackled this problem by launching a citywide, 15-year, 100% residential property tax abatement program. Any new house or apartment built anywhere in the city is eligible to be exempted from property taxes for 15-years, and any renovations of existing houses or apartments, totaling over $5,000, which contribute to the taxable value of the property, are eligible to be exempted.
Click through to read the whole thing. There’s a lot of good stuff in there. Please do read the entire piece as it contain’s subtopics I didn’t even mention.
Segedy makes some great points. I will also add one additional piece of the puzzle: regional demand. Akron is one of the better performing metros in Ohio demographically. But on a regional basis it has only added 7,500 people since 2000. The rest of Northeast Ohio is in decline. It’s a lot harder to get growth for a subarea when the entire area is stagnant to declining.
The contrast with Columbus is instructive. Columbus has added almost 400,000 people since 2000. If they had attracted a mere 10% of this growth to the urban core, that’s 40,000 new people. Just 10% of the net new growth without a single existing regional resident relocating would be game changing for them. In fact, something like this seems to have happened.
There is a route to growth in a declining region. My observation is that decline tends to fuel divergence, with reconsolidation into islands of success. For example, during the dotcom crash, the tech industries in New York and Chicago got wiped out as there was reconsolidation back to Silicon Valley.
In Ohio, I believe something like this is a primary and under-discussed driver of Columbus’ success. Its rise parallels Ohio’s decline. Virtually all of the population growth in Columbus has come from in-state migration. In a sense, success in Ohio has pooled into Columbus as much of the rest of the state has struggled.
The majority of this effect in Midwest states seems to be cross-MSA. But it can happen within regions as well. In this case, the city of Akron could become a success island. But I think that would be challenging to pull off because the success islands tend to be places that were already thriving at some level, such as University Circle in Cleveland.
In the current regional dynamics, it makes sense for Akron to pedal hard to try to make sure it is among the winners not losers. But a better scenario would be lifting overall regional growth. If municipal growth trajectories can be changed, then presumably regional ones can be as well. This would make it a lot easier for Akron to achieve municipal population growth.