Bruce Katz November 9, 1999 Center on Urban and Metropolitan Policy The Brookings Institution Presentation to the Indiana Land Use Consortium The New Metropolitan Agenda

“The sign of a truly educated person is to be deeply moved by statistics.” - George Bernard Shaw

What are the major trends affecting metropolitan areas today? How do cities and counties in Indiana reflect these trends? Where do we go from here? Major Questions ? ?

What are the major trends affecting metropolitan areas today? Major Questions ? ?

Decentralization is the dominant trend in U.S. metropolitan areas.

Population Shifts in Top 10 American Cities,

Outer suburbs are experiencing a population boom.

Population Change, Denver Metropolitan Area Denver population (1998) = 499,055

Population Change, Chicago Metropolitan Area Chicago population (1998) = 2,802,079

Population Change, Baltimore Metropolitan Area Baltimore population (1998) = 645,593

Outer Suburbs Continue to Garner the Lion’s Share of New Housing and New Homeowners.

Suburbs Consistently Outpace Cities In New Housing Permits, Source: U.S. Bureau of the Census, Current Construction Reports

Outer suburbs are experiencing substantial job growth.

Job Location in Washington, D.C. Region, 1990

Job Location in Washington, D.C. Region, 1997

Net Job Growth in Seven Metropolitan Areas* in Ohio, Source: Edward Hill & John Brennan, Where is the Renaissance: Employment Specialization within Ohio’s Metro Areas, Sept * Includes Akron, Cincinnati, Cleveland, Columbus, Dayton, Toledo, and Youngstown MSAs

is becoming more concentrated in central cities. Poverty

Between 1970 and 1990, the number of people living in neighborhoods where 40% or more of the residents are poor nearly doubled: from 4.1 million to 8 million people. Source: Paul Jargowsky, Poverty and Place, Russell Sage, 1997.

Percentage of City Population Living in High Poverty Neighborhoods, 1990 Source: Paul Jargowsky, Poverty and Place, Russell Sage, 1997; U.S. Census data.

General Population & Welfare Caseload, Four Urban Areas

Urban Public School Achievement Percent of 4th grade students at “basic” level on NAEP, 1996 Source: Diane Ravitch, A New Era in Urban Education, Brookings Policy Brief #35, August 1998.

Growth and decentralization are re-making suburbs, changing suburban politics and fueling metro coalitions.

Older suburbs are beginning to take on many of the challenges of central cities. Increasing school poverty Growing racial and ethnic diversity Declining fiscal capacity. Declining commercial corridors and retail malls+

Percent of Students Eligible for Free and Reduced Cost Lunch, 1997

Newer suburbs are also experiencing severe challenges, such as: Choking congestion Overcrowded schools Loss of open space

Change in Vehicle Miles Traveled Philadelphia Region, Source: Philadelphia Inquirer VMT in Millions +55% Regional Population Increase : 3%

Loss of Open Space: The Washington region is losing 10,300 acres a year (28 acres a day) to development: that is equivalent to an area four times the size of Rock Creek Park. The United States has lost nearly 30.5 million acres of productive farmland to development since 1970, at an average rate of 2 acres per minute. Source: Washington Post; American Farmland Trust.

Why is this Happening? 1. Interstate Highway Act / Automobile dominance 2. FHA mortgage financing 3. De-industrialization of central cities 4. Urban renewal 5. Levittown (mass produced suburban tract house) Source: Bob Fishman,”1999 Fannie Mae Foundation Annual Housing Conference Survey: The American Metropolis at Century’s End: Past and Future Influence,” September 1999

Why is this Happening? 6. Racial segregation / job discrimination 7. Enclosed Shopping Malls 8. Sunbelt-Style Sprawl 9. Air Conditioning 10. Urban riots of the 1960s Source: Bob Fishman,”1999 Fannie Mae Foundation Annual Housing Conference Survey: The American Metropolis at Century’s End: Past and Future Influence,” September 1999

How do Cities and Counties in Indiana reflect these trends?

POPULATION

Population Change, Indianapolis Metropolitan Area Indianapolis population (1998) = 741,304

Population Change, Fort Wayne Metropolitan Area Fort Wayne population (1998) = 185,716

Population Change, Evansville Metropolitan Area Evansville population (1998) = 122,779

Population Change, Gary Metropolitan Area Gary population (1998) = 108,469

Population Change, South Bend Metropolitan Area South Bend population (1998) = 99,417

Indianapolis Metropolitan Area’s 1990 Share of Population 1990 Share of Minority Population

JOBS

Change City4.7% Suburbs17% City vs. Suburb Job Location Job Growth City of Indianapolis Source: John Brennan, Edward Hill, Where are the Jobs: Cities, Suburbs, and the Competition for Employment Cleveland State University, August 1999 Draft

Net Change in Pay Indianapolis vs. Suburbs City3.7% Suburb.1% City0.7% Suburb8.9% U.S. Department of Housing and Urban Development: State of the Cities Report, 1999

Percent Change in Total Establishments & % -2.9% 9.0% 24.7% Source: Department of Housing and Urban Development: State of the Cities Report, 1999

CONCENTRATED POVERTY

Percentage of City Population Living in High Poverty Neighborhoods, 1990 Source: Paul Jargowsky, Poverty and Place, Russell Sage, 1997; U.S. Census data.

City of Indianapolis Percent in Concentrated Poverty 1990 Source: Paul Jargowsky, Poverty and Place, Russell Sage, 1997; U.S. Census data.

Marion County, Indiana 1998 Share of Welfare Caseloads vs. Population

Balanced Growth

City Share of Metro Housing Permits for Cities Square Miles, Source: Alexander Von Hoffman, Home Building Patterns in Metropolitan Areas, August 1999 Draft

City Share of Metro Housing Permits Indianapolis, Source: Alexander Von Hoffman, Home Building Patterns in Metropolitan Areas, August 1999 Draft

Vehicle Miles Travel Indianapolis Metropolitan Area VMT Growth Rate = 30.87% Population Growth Rate = 8.1% Source: United States Census United States Department of Transportation

Vehicle Miles Travel Ft. Wayne Metropolitan Area VMT Growth Rate = 17.28% Population Growth Rate = 4.2% Source: United States Census United States Department of Transportation

Vehicle Miles Travel South Bend/Mishawaka Metropolitan Area VMT Growth Rate = 26.49% Population Growth Rate = 4.3% Source: United States Census United States Department of Transportation

68.0% 65.8% Farm Land as a Percent of State’s Total Land Area Average Operator Age Percentage with Farming as Principal Occupation %46.6% Farms, Farmers, Farming Source: United States Department of Agriculture

How are states and the federal government responding?

The New Metropolitics Leaders of Older Communities Political Downtown Business Civic Community Newly Developing Suburbs Political Leaders Environmentalists Farmland Preservation Advocates No Growth Citizens Other Regional Business Alliances Regional Media Religious Leaders

The New Metropolitan Agenda 1. Metropolitan Governance 2. Land Use Reform Acquisition of Open Space 3. Smart Growth Infrastructure Spending 4. Tax Policy Fiscal Disparities 5. Access to Opportunity Welfare-to-Work Workforce Development Housing

State Responses

State Responses: Regional Governance

Created by the State Legislature in 1999 to combat air pollution, traffic congestion and sprawl development Authority currently lies only in the metro Atlanta area which is currently out of compliance with the Federal Clean Air Act. The Authority has the power to move into other areas of the state if and when they fall out of compliance with the Federal regulations. GRTA approval is required for major highway and development projects that affect the metro Atlanta region. Governments that do not cooperate with GRTA face a cutoff of many state and federal funds, including money for road-building.

State Responses: Growth Management/Land Use 11 states

Requires the development of county growth plans which must identify urban growth boundaries, planned growth areas, and rural areas in each county large enough to account for anticipated growth for the next twenty years or risk losing access to state transportation funds Urban Growth Boundaries

State Responses: Acquisition of Open Space 9 states passing state-wide ballot referenda in 1998

Open Space Bond Referendum Passed in Sets aside $1 Billion over 10 years to permanently save a million acres of resource lands. Financed by State setting aside $98 million a year of state sales tax revenues for 10 years and the allocation of $1.0 billion in bond proceeds to preserve open space and historic resources 16 Counties and 92 municipalities are now authorized to dedicate a portion of their property taxes or sell bonds to fund open space and farmland preservation and/ or park development and maintenance.

State Responses: Smart Growth 3 states

 Targets major state funding (e.g. transportation, housing, state facilities) to Priority Funding Areas.  Priority areas include all municipalities, inner beltway areas, enterprise zones, industrial areas and new planned growth areas with water/ sewer. SMART g r o w t h Maryland

State Responses: Tax Sharing

Allocates 40% of the growth in property tax revenues from commercial industrial development to a metropolitan tax base pool. Funds in the pool are then redistributed to communities based on commercial tax capacity. Narrows but does not eliminate fiscal disparities; growing suburbs continue to have 25 to 30 percent more tax base per household than do central cities and inner suburbs Minnesota Fiscal Disparities Law

The Federal Response

Better America Bonds TEA-21 Clean Air Act Capita l Gains Relief

Where do we go from here?

General Observations State governments are key to set rules of development game Metropolitan agenda is mutually consistent and reinforcing Composition of metro coalitions varies state to state Immediate point of policy intervention also varies Not necessarily about consensus Land use/environmental agenda will be most successful when coupled with urban reinvestment effort

Ten Next Steps for Regional and State Reforms 1. Fill empirical holes 2. Identify policy reforms- top- down 3. Identify policy reforms- bottom- up 4. Develop strategies for achieving policy reform 5. Market & disseminate ideas 6. Understand consumer/voter/bu siness 7. Build capacity of key constituencies 8. Support network of key constituencies 9. Convene 10. Cross-pollinate

The New Metropolitan Agenda 1. Metropolitan Governance 2. Land Use Reform Acquisition of Open Space 3. Smart Growth Infrastructure Spending 4. Tax Policy Fiscal Disparities 5. Access to Opportunity Welfare-to-Work Workforce Development Housing

“Why not go out on a limb? That’s where the fruit is.” -Will Rogers