The Role of Government in Advancing Resilient Prosperity and Climate Restoration

This issue’s Sneak Peek feature—which excerpts my upcoming third book, RECONOMICS (coming January 2020)—deals with the role of government in creating or sustaining resilient prosperity and restoring our global climate. The excerpt appearing in the next issue will deal with the role of foundations, especially community foundations.

The Role of Government in Advancing Resilient Prosperity and Climate Restoration

by Storm Cunningham

Coming together is the beginning. Keeping together is progress.
Working together is success. – Henry Ford

Revitalization doesn’t happen to a community. It’s self-inflicted healing.

As originally suggested in The Restoration Economy (2002), there are three basis personality types. They correspond to three basic modes of economic development, and three corresponding types of government policy:

• Sprawlers build cities and extract virgin resources;
• Sustainers maintain cities and conserve nature;
• Revitalizers renew cities and restore nature.

Where do real estate developers fit in that scenario? Developers are usually Sprawlers. Redevelopers are usually Revitalizers. The fact that densification (“intensification” in Canada) is replacing sprawl in most nations means that Revitalizers are displacing Sprawlers.

I say “usually” above because not all redevelopers revitalize. Even a lot of “new urbanist” redevelopments are highly destructive, replacing interesting urban environments with hyper-commercial sterility. Many are the urban equivalent of replacing a forest with a tree farm. The right thing can always be done badly. (A pity, since we’ve become so expert at doing the wrong things well.)

Poor implementation aside, a taxonomy such as the one above can greatly simplify the process of crafting policies and choosing policymakers. If you’re building a new nation and need new cities, Sprawlers are the folks you need. But who on Earth is in that situation these days?

A taxonomy such as that can greatly simplify the process of crafting policies and choosing policymakers. If you’re building a new nation and need new cities, Sprawlers are the folks you need. But who on Earth is in that situation these days?

What we’ve got is a planet burdened by badly-planned, unplanned, or simply obsolete cities. For them, we need the Sustainers and the Revitalizers. Sprawlers are counterproductive when one is heavy on damaged or underused built assets, heavy on overused natural assets, and light on healthy green and agricultural land.

So, one of the first steps on the path to a brighter future is for governments to realize that derelict natural and built assets are doorways–not obstacles–to urban and rural economic growth.

Some U.S. states are enjoying governors who understand the key role urban revitalization plays in state economies. For example, on January 15, 2015, New York Governor Andrew Cuomo announced a $1.5 billion Upstate New York Economic Revitalization Competition. Three years earlier, he had offered $1 billion over 10 years to restore the greater Buffalo economy, a program that’s working wonders.

But, for the most part, citizens everywhere are increasingly disgusted with their national and state-level politicians. The good news is that the quality of mayors seems to be improving. Nonetheless, serious problems remain. Many places try to revitalize. Few succeed. Few of the successes last.

Resilient prosperity should thus be a primary goal of public management. An ongoing process of fixing the present and the future together is how places revitalize in a resilient manner. Few places aim for Resilient Prosperity, so eventual devitalization of parts (such as neighborhoods or the downtown) or the whole is in the cards for most. Why don’t local, state, and national leaders take revitalization seriously? Why do most rely on hope?

If resilient prosperity is what we want, government should focus on it. And the starting point has to be the revitalization process, along with the myriad “re” activities that comprise it: regeneration, redevelopment, brownfields remediation, historic restoration/reuse, infrastructure renewal, etc. Why? For the same reason that Willy Sutton robbed banks: that’s where the money is.

Of the three central elements of adaptive renewal—revitalization, resilience, and adaptive management—truly understanding the first, revitalization, is the most important. Resilience and adaptive management are of lesser importance for two reasons: 1) they are both relatively new to the public dialog, so people are more open to learning about them (whereas most leaders erroneously assume they understand revitalization); and 2) few, if any, resources are devoted to resilience and adaptive management in most cities and regions, so there’s not much to work with.

On the other hand, well over $3 trillion is spent annually worldwide on urban revitalization and natural resource restoration. Integrating resilience and adaptive management with those existing budgets is thus the quickest way for them to get traction. There’s nothing forced about this 3-way wedding; they reinforce each other quite naturally. Together, they can solve both today’s persistent problems and tomorrow’s unknown—but potentially calamitous—problems.

If you ask a city council to define “revitalization”, how many different answers will you receive? Hint: take the number of council members, and divide by one. Contrary to current practice, revitalization shouldn’t just be a reaction to devitalization: it should be a constant process of breathing new life into our world, regardless of condition. Fixing the present (tactical renewal) and the future (strategic renewal) together leads to Resilient Prosperity. Every place approaches the process of improving itself in a different manner, since every place has different dreams, different challenges, and a different culture. But one characteristic is universal: with few exceptions, these efforts are all tactics, no strategy.

In Vietnam, America won most battles, but lost the war. It’s similar in cities: many successful projects, but a failure to revitalize. Most places lack a strategy for fixing the present, so a strategy for fixing the future (resilience) would be revolutionary. Part of the problem is ignorance: few communities have anyone who understands the dynamics of revitalization well enough to create a strategy. The other problem is that—even with such a person—they don’t have a Revitalization (or Resilience) Director position in their governance structure, from which to exert the necessary influence, adding cohesiveness and momentum to their projects.

Many folks renew and reuse historic buildings. Others clean and redevelop brownfields. Some restore watersheds, ecosystems, farmlands, or greenspace. Others improve public transit, or make communities more pedestrian-and-bicycle-friendly. Some renew infrastructure. Some specialize in catastrophe recovery and resilience. Others activate vacant lots with community gardens, farmers’ markets, pop-up functions, and pocket parks. Wonderful activities all…but none focus on the whole.

Economic development directors would say “Hey: I’m in charge of revitalization, and I have training”. However, “economic development” is traditionally just sales. The pitch to employers is “move here: we’re cheaper”, but price competition is the weakest form of selling. Most relocating firms have already chosen a new location before demanding public sector handouts ($80 billion/year in the U.S.). Wooing employers from another city might revitalize winners, but it devitalizes losers.

In New Jersey, Governor Chris Christie gave $40 million in tax incentives to Cooper Health System to relocate 353 jobs from a Camden suburb to downtown Camden. Now, I’m all in favor of downtown revitalization, but does it really make sense to move jobs from one place in your own state to another, while eliminating the tax benefits of having that employer in the state in the process?

Governor Christie also gave Lockheed Martin $118 million in tax incentives to move 250 jobs from another Camden suburb to the downtown. How much tax revenue is New Jersey expected to earn from Lockheed Martin over the next 35 years? A grand total of $248,000. Sounds more like economic suicide than economic development. [Critics say Lockheed Martin got a $118 million return on the $50,000 they donated to Christie’s Republican Governors Association.]

There’s certainly no net gain for the nation: it’s a zero-sum game (actually, a negative-sum game) that merely shuffles jobs around while sucking revenue from vital public services. [The good news is that GASB, the Governmental Accounting Standards Board is proposing new rules that would require local governments to annually report on the revenue they’ve lost to economic development subsidies.]

Growth of good jobs is a joy to the unemployed, and a key component of revitalization, but it’s not revitalization. I specify “good” because demeaning, low-paying jobs demoralize communities, and many economic developers focus only on quantity, not quality. The system is perpetuated by lack of rigorous metrics: economic development agencies tend to take credit for any jobs that arrive, regardless of provenance. As an economic developer in North Carolina once said about his state’s strategy: “We shoot anything that flies and claim anything that falls.”

Some economic development organizations (EDOs) rise above this old job-recruitment mode. Examples include InvestAtlanta, and the Philadelphia Industrial Development Corporation (which led redevelopment of Philly’s old Navy Yard). Some of them, like the Urban Redevelopment Authority of Pittsburgh, even use “redevelopment” rather than “economic development” in their names.

The International Economic Development Council (IEDC) is encouraging evolution of the profession, but “re”-focused EDOs are still the exception: far from the norm. That said, the Executive Summary of the IEDC’s 2014 report “Looking Around the Corner: The Future of Economic Development” unfortunately didn’t contain a single “re” word (redevelopment, revitalization, regeneration, remediation, reuse, renewal, restoration, etc.). To its credit, it does say “It is likely that [economic developers] will play a key role in reinventing their communities, and even their own organizations, several times over.”

EDOs say new employers give cities the money to do redevelopment, but experience doesn’t support that hypothesis. How can cities pay for renewal if they’ve forfeited all corporate and property taxes for decades? One problem is that the name—Economic Development—tends to inhibit focusing on social, infrastructure, or environmental agendas.

Another problem is their bosses: mayors and city councils often want the “quick fix” of new employers, so that’s how they measure the EDO’s success. Yet another problem is that almost anyone can call themselves an economic development professional. So the majority—those who “steal” jobs from other communities, or who base economic growth on destructive sprawl—can bask in the halo of the minority who base economic growth on restorative development.

Planners will tell you they’re in charge of revitalization. Some are. But few plans contain a revitalization strategy or process, few plans are implemented, and few of those that are implemented succeed. Too many “comprehensive plans” resemble rearranging the Titanic’s deck chairs, rather than a strategy for avoiding the iceberg. Land use planning is land use planning: it’s essential, but it’s not revitalization.

A leader takes people where they want to go. A great leader takes people where
they don’t necessarily want to go, but ought to be. – Rosalynn Carter, U.S. first lady

Here’s why: A project is how we implement a plan. A plan is how we implement a strategy. A strategy is how we implement a vision. But creating a vision and strategy is not the planners’ job. Too many communities force planners to work in the dark. Asking them to create a plan for your community without supplying them with a vision and strategy is like asking a travel agent to plan your vacation, without telling them where you want to go. We must end such planner abuse.

Smaller communities that successfully revitalize often have a core group of trusted, visionary “doers” who are always at the table. In the best situations, these folks keep the revitalization process going, due to their awareness of continuing local needs. They’re motivated to “do the right things” by their deep familiarity with—and passion for—the future of their community. For those on the private side, a profit motive is often involved, but everyone at the table understands this. When such groups work to benefit all, they can be wonderful. If they are bigoted, misogynous old men who are insensitive to the needs of youth, women, and minorities, the place is in trouble. A lot of places are in trouble.

Many of the professionals and initiatives mentioned here renew natural, built, or socioeconomic assets, and are thus contributing to revitalization. But they aren’t Revitalization Directors, nor are those projects and programs strategic, fixing the present and future together to create Resilient Prosperity. Some think that executing a redevelopment project is the same as implementing a revitalization or resilience strategy. But how can a project do that if there is no revitalization or resilience strategy…no dedicated agency…no one in charge who understands the underlying dynamics? How can we manage revitalization if we don’t even acknowledge it as a process; only as a fuzzy, feel-good goal?

Revitalization ignorance results in waste, distress, and pessimism…and in community devitalization. This ignorance is seen in the constant waves of revitalization fads that sweep through cities. It’s similar to how management fads continually wash through the corporate sector, as CEOs desperately try to convince employees, investors, and themselves that they have some control over the future. We see revitalization ignorance at work in kneejerk attempts to become the next “Silicon Whatever”, and in “strategies” based on positive-but-generic characteristics like innovation, creativity, smart, green, etc. We see it at work when cities copy the physical manifestations of revitalization, rather than the processes that led to them.

Witness the explosion of public aquariums aping the successes of Baltimore and Chattanooga. Witness the global frenzy of “starchitecture” museums and arts venues aping Bilbao’s Guggenheim Museum (which was only one of many contributors to that city’s heroic 20-year regeneration effort).

All three of those successful urban rebirths had their own unique and locally-appropriate revitalization process and strategy. Baltimore’s was primarily developer-led (“impromptu”). Chattanooga’s was primarily grassroots and foundation-led (“bottom-up”). Bilbao’s was primarily government-led (“top-down”). None were perfect, but all worked very well. Baltimore didn’t do a good job of integrating the revitalization of its Inner Harbor with the rest of the city. Chattanooga made the mistake of disbanding their excellent citizen-led visioning organization. Bilbao could have done a better job of engaging the citizens of affected neighborhoods (such as the one around the Guggenheim Museum).

In each case, their spectacular results were preceded by many years of thought, planning, alliance-building, and public engagement. But their imitators didn’t want to learn, or change their behavior. They weren’t interested in processes. They just wanted to buy products, like casinos, stadiums, and convention centers. And it’s not just cities: Nations also jump on one-size-fits-all economic fads, like austerity, no matter how poor their track record. They could instead fix fundamentals, such as restoring natural resources, or reducing economic “friction” via infrastructure renewal, but don’t.

Another outcome of revitalization ignorance is when public leaders confuse cause with effect. Mayors tour revitalized cities, and witness the plethora of retail and restaurants. They then return home and artificially stimulate retail and dining in their devitalized downtown via subsidies and other incentives. A year or two later, that downtown—formerly full of long-dead stores—is now full of recently-dead stores. The psychological impact can be devastating, as citizens start thinking of themselves as losers.

Retail is a sign of revitalization, but seldom its cause. Residents should almost always come first. Revitalization is often a long, uncertain process. Downtown residents have revitalization patience: they can wait far longer for nearby stores than retailers can wait for nearby customers. An exception is downtown “central markets”: they can attract shoppers from a large geographic area by adding entertainment, cultural elements, and critical mass to retail, and can thus be excellent revitalizers.

Appointing a Prosperity Director with a grasp of regenerative principles helps avoid painful mistakes, and helps reduce institutional memory loss deriving from turnover of elected leaders. If you’ve watched the “American Restorations” TV show, you’ve seen the difference between restoring something old to its original appearance, restoring its original functionality, and restoring better-than-original functionality (due to modern materials). Whether restoring an iron lung or a motorcycle, conflicting constraints—such as aesthetics, performance, time, and cost—must be dealt with at every step.

I would avoid riding a motorcycle that had been restored with aesthetics taking precedence over functionality. So too would I be nervous about investing in a city whose revitalization was only skin deep. In the absence of trained revitalization professionals, we often get a focus on form over function.

The painful, expensive ways in which revitalization ignorance manifests are endless. The few mentioned here could all have been avoided with common sense. But that’s the point. Even with good intentions, the same mistakes keep getting made and the revitalization “wheel” keeps getting reinvented—community-by-community, nation-by-nation—without qualified people focused on revitalization.

Another example of revitalization ignorance is found in tax increment financing (TIF). Invented to revitalize blighted areas, it has done so very well for over 60 years. But today, TIF typically suffers from:

• Misuse (funding sprawl);
• Abuse (handouts to developers); and
• Overuse (depleting general revenue).

All three of these problems result from a combination of insufficient transparency and revitalization ignorance. TIF is what’s known as a “value capture” mechanism. It’s unique in that it captures enhanced future value, and makes it available to spend in the present, to make that future value enhancement happen. Kind of like economic time travel. Many cities complain that overuse of TIF has damaged their school funding. But the Union Township of greater Cincinnati—recognizing the role of quality education in revitalization—announced in January of 2015 that a new high school would be constructed with TIF funding, using no taxpayer money. Sounds simple, but it’s a revolutionary innovation.

There’s a trend towards greater innovation in cities (such as “Innovation Districts”), but innovation can either improve or damage a place. Tying innovation to an Adaptive Renewal system ensures the former. The most tragic display of revitalization ignorance took place in the U.S. during the 50s and 60s. No enemy could have hoped to inflict the physical and economic devastation we did to ourselves. The federal government provided “urban renewal” funding to cities for tearing down old buildings. The premise was “destroy it, and they will come.” “They” never came, and—60 years later—many cities still suffer from massive downtown dead spaces, and from the lack of restorable, beautiful old buildings.

Most local redevelopment agencies in the U.S. arose during this “urban renewal” fad. In 2011, California Governor Jerry Brown killed every one in the state, claiming they were wasteful, corrupt, and autocratic. In 2014, he introduced a smaller, more transparent form of redevelopment agency, and a reformed TIF model. Governor Brown is redeveloping redevelopment, and revitalizing revitalization. But the process was painful, as surgery is, and more than a few great projects were killed or wounded in the transition.

The “urban renewal” debacle also caused citizens to lose faith in both mayors and planners. Local government power was greatly curtailed, and U.S. cities became overly dependent on private developers to “do the right thing”. A few rose to that challenge, but most didn’t, and U.S. cities have missed many opportunities to develop responsibly as a result. Most improvements in national policy derive from local innovations, so it’s time for the pendulum to swing back, giving cities more control over their future. A Prosperity Director can help ensure that policies make places better, not worse.

Governments must abandon episodic redevelopment and slipshod revitalization efforts. For decades, communities and regions have pinned their welfare on attracting business and real estate developers; the more the better. Little attention was paid to attracting quality employers or developers. Even less attention went to ensuring that all this activity led the community in a desirable direction. The modern nightmare of sterile, unhealthy suburbs and empty, forlorn downtowns is the natural result.

Government-appointed Prosperity Directors (or whatever they wish to call them) could help redevelopers by providing real-time mapping of local property renewal, repurposing, and reconnection opportunities. They could land-bank them to speed property assembly for large projects. Granted, communities can do all this without creating any new positions or departments. But why should something as crucial as renewal be homeless, lacking a dedicated champion? [See Tactic #3 for more.]

In this disorganized, visionless environment, many developers became Professional Devitalizers. Instead of aiding local regeneration, they fostered degeneration (Professional Degenerates?). But we shouldn’t blame them. We kept electing Leaders of Self-Destruction who let developers create Places Without Hearts, populated by over-medicated, underpaid, socially-isolated, traffic-numbed Commuters Seeking Joy As Consumers. They built places not worthy of revitalization.

The good news? Some developers (actually redevelopers) performed magic, spectacularly bringing blighted places back to life. They provided the vision, ethics, and wisdom local leaders lacked. These professional revitalizers were a rare breed. They’re now a fast-growing breed. I call them “fixers”. Why? Because they actually fix problems. They don’t just have the responsibility, or the willingness, or the ability to fix problems: they do it. Writers write. Doers do. Fixers fix.

There are proven ways to attract private “fixers” by making places “Fixer-Friendly”. Governments and foundations are starting to take revitalization and resilience seriously. Together, these public and private Fixers can conjure Resilient Prosperity. There is no shortage of money in today’s poverty-stricken world. Fixers are ready and willing to invest in your place, IF you inspire confidence in your local future (they want your rising tide to raise their boat), and get out of their way. Many distressed places can’t afford capital-intensive projects to fix their present. But they can afford a strategy to fix their future, which inspires the necessary confidence.

Improving our economies, our quality of life, and our environmental health together means basing economic growth primarily on renewing our natural, built, and socioeconomic environments. Sprawl can grow an economy, but at the cost of both quality of life (traffic jams, loss of greenspace, etc.) and environmental health (loss of biodiversity and farmland, watershed deterioration, etc.). Many places say they are against sprawl, but subsidize it by not charging developers the full cost of providing services.

So, what can governments do to advance Resilient Prosperity? The quickest path is to make sure they all share a vision of a secure, inclusive, green economy when making decisions, and develop an Adaptive Renewal strategy from that vision. Adaptive Renewal integrates revitalization, resilience, and adaptive management. But resilience and adaptive management are newcomers to public management, so the low-hanging fruit is in better-organizing those who are already working to revitalize your place.

A decade ago, Philadelphia’s outdated sewer system…was crumbling, causing a nasty brew of storm-water, raw sewage, and pollutants to flow directly into local waterways. But the cash-strapped metropolis… couldn’t afford to build a new system. So the city decided to think small—and local, and cooperative—to construct something big and different. The city rolled out its “Green City Clean Waters” plan in 2011: a 25-year effort to let residents take the lead in creating a web of small interconnected “green” infrastructure projects like roadside plantings, green roofs, porous pavements, street trees, and rain gardens….The key to the “Green City Clean Waters” plan was building layers of community engagement and partnerships over technical and governance systems. … schools and libraries will teach kids about water with hands-on active learning projects like rain gardens, while the city enforces requirements for the replacement of non-porous surfaces, offers funding and support for neighborhood initiatives, and streamlines bureaucratic procedures to facilitate their approval and success. – from “It Takes a Village: The Rise of Community-Driven Infrastructure” by Greta Byrum, The Atlantic, Jan. 30, 2015

Working on making your place Fixer-Friendly will attract the resources you need, and make existing resources more effective. If you have a dedicated local group of fixers, you can make them more effective by turning them into a resilient prosperity team (again, see Tactic #3). At the least, appoint a prosperity director to ensure progress towards fixing this rampant inefficiency and dysfunction (see Tactic #2). And then create a local prosperity system, team, and/or agency.

In summary: Too few political leaders have a clear idea of what contributes to revitalization and resilience, and what retards them. This makes it difficult to stimulate, manage, monitor, and report efforts to create resilient prosperity. Awareness and knowledge should precede action. Whatever path your community or region takes, it’s vitally important for it to start taking revitalization seriously, and stop treating it as some form of uncontrollable magic. We can do better.

About the Author

Storm Cunningham is the publisher of REVITALIZATION.

Since 2002, he has been a full-time revitalization process planner for organizations, communities, and regions. He is also a professional speaker and workshop leader on community revitalization, economic resilience, and natural resource restoration.  His clients include national and local governments, universities, and non-profits in over a dozen countries.

He lives in Arlington, Virginia, and is the author of two highly-acclaimed books:
The Restoration Economy (Berrett-Koehler, 2002), and Rewealth (McGraw-Hill Professional, 2008).
See http://RestorationEconomy.com and http://Rewealth.com for more information about these books.

See http://StormCunningham.com for more on his work.

Storm can be reached at 1-202-684-6815, or at storm@revitalization.org