CHANGING THE RULES OF THE GAME White House Forum on First Suburbs, Sustainability, Inclusion and Economic Growth July 18, 2011 A presentation by David Rusk Building One America 4100 Cathedral Avenue, NW #610 Washington, DC (202)

State law & Federal dollars have created the “Geography of Opportunity”

State law determines How and where local governments are organized What revenue sources and powers they have

Billions of Federal dollars shape what gets built where for whose benefit … and at whose cost

For decades Federal “urban policy” may have targeted central cities…

But for decades Federal dollars have promoted sprawling new development in exclusive outer suburbs.

The First Suburbs – the streetcar-era, post-WWII suburbs and the older metropolitan towns – have been neglected and today they are struggling.

The current political reality: No increase in Federal money to help the First Suburbs

We don’t need to increase the deficit to

Change the “rules of the game.”

Alter how Federal funds are allocated: To promote & reward diversity To promote & reward Smart Growth To promote & reward cooperation and regional planning To leverage state and local investment

Federal leverage (2009) $145 billion in HUD-DOT-EPA grants-in-aid $214 billion in tax subsidies for housing $700 billion in FHA-guaranteed mortgages $5.1 trillion in Fannie Mae & Freddie Mac mortgage portfolio

Not all suburbs are the same First Suburbs are economically and racially diverse, but with rising numbers of low income families First Suburbs have small, shrinking or stagnant tax base

Result: The First Suburbs have low tax bases and high school costs - Lower opportunity communities

Newer outer suburbs:  Economically & racially exclusive  Growing regional job centers  Large commercial tax bases  High performance schools, good local services, and lower tax rates Higher opportunity communities

Changing “rules of the game” starts with mapping the “Geography of Opportunity” for any region (example: Municipal Opportunity Index for Philadelphia region)

Factors for a Municipal Opportunity Index Jobs 35%  Schools 35%  Tax Base 10%  Neighborhoods 20%

Southeastern PA is divided into: 23 maximum opportunity towns  37 high opportunity towns  43 medium opportunity towns  59 low opportunity towns  75 minimum opportunity towns  1 central city (Philadelphia) 238 cities, boroughs, and townships

Let’s eliminate rural townships that are not part of Philadelphia or Pottstown Urbanized Areas to focus on true First Suburbs and to emphasize need for farmland preservation/anti-sprawl policies to protect rural communities.

3 BIG CHALLENGES facing First Suburbs: Job sprawl Too much affordable housing Low performing schools

Two guiding principles for changing Federal rules of game to stabilize & strengthen First Suburbs:

FIRST: Use regional opportunity map to allocate more federal dollars to medium, low, and minimum opportunity First Suburbs that are the most environmentally sustainable and racially & economically inclusionary.

SECOND: Use regional opportunity map to shape Federal policies and incentives to slow/stop suburban sprawl and diversify high and maximum opportunity suburbs that are still racially & economically exclusionary.

But that’s not what has been happening…

JOB SPRAWL Fueled by Federal highway funds, in 95 out of 98 largest metro areas, percentage of regional jobs located more than 10 miles from downtown increased. By 2006, more than 45% of all jobs located more than 10 miles out (67% in metro Philadelphia)

AFFORDABLE HOUSING Outer suburbs’ exclusionary practices & HUD housing voucher policies make First Suburbs’ homes and rentals only choice for low/moderate income families that are “moving up & out.”

Minimum Opportunity Towns in Delaware and Montgomery County #1 Ridley Schwenksville Hatfield West Pottsgrove Lansdowne Upper Frederick Pottstown Ridley Park Upper Darby Red Hill Norristown Prospect Park Chester City East Greenville Eddystone Parkside Green Lane Bridgeport Glenolden Chester Twp Yeadon Folcroft Upland Norwood Darby Boro Sharon Hill Aldan Marcus Hook Clifton Heights Darby twp Lower Chichester Collingdale Ambler Trainer East Lansdowne Millbourne # 37 Colwyn

Affordable Minimum Opportunity Towns by current HUD housing voucher rent limits #1 RidleyChester CitySharon Hill SchwenksvilleEast GreenvilleAldan HatfieldEddystoneMarcus Hook West PottsgroveParksideClifton Heights AmblerGreen LaneDarby Township Upper FrederickLansdowneChester Township PottstownBridgeportCollingdale Ridley ParkGlenoldenLower Chichester Upper DarbyYeadonTrainer Red HillFolcroftEast Lansdowne NorristownUplandMillbourne Prospect ParkNorwood#37 Colwyn Darby Boro

Maximum Opportunity Towns in Delaware and Montgomery County #1 Upper ProvidenceWhitemarsh WhitpainUpper Gynedd Lower MerionChadds Ford MontgomeryRadnor Upper Merion#10 Lower Gwynedd

Affordable Maximum Opportunity Towns by current HUD housing voucher rent limits

Current HUD housing voucher Fair Market Rent (FMR) limits shut low-income families out of 19 of 25 largest job centers in Delaware and Montgomery counties. That’s the issue of access to good and growing job supply.

What about the issue of access to high performing schools?

High Performing Schools High performing schools invariably have low percentages of low income students (as measured by those qualifying for Free And Reduced-price Meals, or “FARM”).

FARM percentages by MOI category  Maximum opportunity towns 5%  High opportunity towns 7%  Medium opportunity towns 12%  Low opportunity towns 21%  Minimum opportunity towns 41%  Philadelphia Public Schools 77%

HOUSING POLICY IS SCHOOL POLICY

SCHOOL POLICY IS HOUSING POLICY

Number of “Red Zone” schools are steadily increasing in First Suburbs because of housing policies and infrastructure-driven regional growth patterns

Change “Rules of the Game” to: Revitalize central cities Diversify outer suburbs/stop sprawl Invest heavily in First Suburbs that are already developed and diverse

Main Policy Opportunities: Reform housing policies Target infrastructure investment Reform school funding to reward diversity

Model Housing Policies Montgomery County, MD’s mandatory inclusionary zoning policy has produced 12,500 affordable units for very low-income families integrated with 90,000 market-rate units in 250 mixed income neighborhoods.

Model Housing Policies New Jersey’s Mt Laurel decision and Housing Reform Act of 2008 All 566 municipalities required to have regional “fair share” of affordable housing; no escape clauses 20% of all state-assisted housing developments must be affordable (5% for extremely low-income)

Federal housing policies must reinforce state and local initiatives to create economically integrated neighborhoods and to prevent concentrations of low-income families.

Example of a Federal housing policy reform: HUD’S SMALL AREA FAIR MARKET RENT BY ZIP CODE PILOT PROGRAM

REMEMBER: Affordable Maximum Opportunity Towns by current HUD housing voucher rent limits - None!

Affordable Maximum Opportunity Towns with Fair Market Rent by ZIP code #1 Upper ProvidenceWhitemarsh WhitpainUpper Gynedd Lower Merion (not yet)Chadds Ford Montgomery (not yet)Radnor Upper Merion#10 Lower Gwynedd

Example of Federal housing- transportation reform HUD-DOT-EPA PARTNERSHIP FOR SUSTAINABLE COMMUNITIES

SUSTAINABLE COMMUNITIES INITIATIVE (SCI) $150 million in FY 2010 $100 million in FY 2011 No Congressional guidelines ($145 billion in total grants)

SCI grantees should be required or incentivized: – Regional opportunity mapping – Mixed-income housing, particularly in higher opportunity towns – Regional mobility programs to assist low-income families to move from lower opportunity to higher opportunity towns

regional opportunity mapping5 pts inclusionary housing in hi opportunity towns5 pts regional housing mobility program5 pts job and tax-base increases in First Suburbs7 pts better transit access between First Suburbs and major regional job centers3 pts HUD-DOT-EPA could also reward through providing bonus points in grading discretionary SCI grants:

Model transportation/land use planning Multi-county Portland Metro  citizen-elected regional government  plans and enforces anti-sprawl Urban Growth Boundary  requires higher-density, mixed-income housing development  shifted Federal funds from highways to First Suburb light rail system

Federal transportation reform Transportation Opportunities Act of 2011 National Infrastructure Innovation and Finance Fund Fix It First priority for highway and bridge investments Directs more funding to First Suburbs infrastructure Should promote MPO reform Should link DOT funds to Smart Growth and economic integration

Model school funding reform “Money Follows FARM Child” formula  rewards greater diversity  moots “fiscal zoning”  stabilizes First Suburbs tax rates Examples: – New Mexico (1972) – Pennsylvania (2008) – New Jersey (2008)

Why Organize The First Suburbs?  Investing in First Suburbs is investing in sustainability, inclusion and in our economic future  State/Federal reforms need strong grassroots support  First Suburbs have more members of Congress, more independent voters, and more competitive districts  First Suburbs are where bi-partisan civil civic debate takes place everyday  First Suburbs are a unifying force in our metro regions and…

… when organized, First Suburbs are more powerful than the sum of our many parts