Local Government Roles in Redevelopment
Vol. III, No. 202 - A reader question leads to today's newsletter
Recently, one of our readers gave me a question to think about when it came to the role local government plays in redevelopment efforts. All across the county, local governments are purchasing and redeveloping parcels under the banner of community and economic development.
This is an excellent question and deserves a full throated discussion of what are some the arguments, pro and con, of local government activity in redevelopment and what the different roles the local government takes on in redevelopment activities.
The Arguments
There are plenty of arguments that both support and oppose a local government’s role in redevelopment activities. In practice, the concept of community development has often revolved around taking existing structures, whether they be commercial, industrial or residential and bringing them back into productive reuse. And the arguments for or against a community development effort usually revolve around these ideas.
Arguments for the Role of Local Government:
Community Development: Reclaiming and remediating vacant properties can contribute to the overall development of the community. By bringing these properties back into productive use, local governments can revitalize neighborhoods, attract businesses, and improve the quality of life for residents.
Economic Benefits: Returning vacant properties to the market can stimulate economic activity. When properties are occupied and businesses are established, it creates jobs, generates tax revenue, and boosts local economic growth. This can lead to increased property values, increased spending, and a more vibrant and more diversified local economy.
Blight Mitigation: Vacant properties often contribute to blight and decay in neighborhoods. They can attract crime, become health hazards, and lower the overall attractiveness of an area. By reclaiming and remediating these properties, local governments can combat blight, improve safety, and enhance the overall aesthetic appeal of the community.
Housing Availability: Reclaiming vacant properties can address the issue of housing scarcity and affordability. By making these properties available for sale or rent, local governments can increase the housing stock and provide opportunities for individuals and families who are struggling to find affordable housing options.
Arguments Against the Role of Local Government:
Private Property Rights: Some argue that it is not the role of local government to interfere with private property rights. Property owners should have the freedom to decide what to do with their vacant properties, including selling or leaving them vacant. Government intervention in this regard may be seen as an overreach and infringement on individual liberties.
Financial Burden: Reclaiming and remediating vacant properties can be costly for local governments. Allocating funds for these purposes may divert resources from other essential services, such as education, healthcare, or infrastructure development. Critics argue that the burden of reclamation and remediation should be on the property owners themselves, rather than on taxpayers.
Market Distortion: Subsidizing the process and selling vacant properties at a loss may distort the real estate market. This can create unfair advantages for certain buyers or investors, potentially leading to market inefficiencies and unintended consequences. Critics argue that the market should be allowed to determine the value and fate of vacant properties without government intervention.
Risk of Mismanagement: Government-run programs for property reclamation and remediation may be prone to inefficiencies, bureaucratic red tape, and potential corruption. Critics raise concerns about the ability of local governments to effectively and transparently manage these initiatives, and argue that private sector involvement may be more efficient and effective.
While we look at the arguments for or against a local government playing an active role in these community development activities, it’s really important to give thought to what role is the local government really playing?
What’s the Proper Role?
One of the aspects of local government that often goes misunderstood are the different roles that local government can play in the work that it does (including redevelopment projects).
The Financer
This is probably the role that most people see what local government does. On its face, it seems very logical. If there is one thing that government is adept at doing, it’s spending money. Every local government has a dedicated individual (or group of individuals) whose main role is to either spend or oversee the spending of money. Most of the processes that government is a part of, revolves around spending money; things such as purchasing, financing, contracting and hiring all have spending money in common.
So, it’s also not a surprise that it’s the spending of money gets most of the attention of those that pay attention to local government. Nearly everyone in the community pays taxes to the local government and has a vested interest in how those dollars are being spent on their behalf. But on the other hand, just because government is involved, it does not mean that there must be a large direct expenditure of taxpayer dollars that have to be made. Government can play other roles to influence decisions and implement solutions.
The Convener
One of the most powerful roles a local government can play is the role of convener. When faced with large-scale challenges, communities may be in a position where only the local government has the gravitas to pull different sectors and different organizations to discover and promote solutions.
Government need not spend money on those final solutions, but they can at least bring parties together to talk about proposed solutions and find ways each sector can help bring their own resources to bear on overcoming the obstacles in front of the community. There are few parties with the ability to bring people and institutions together like the local government when it comes to broad community-wide problems.
A very concrete way this solution plays out can be as simple as a traditional neighborhood watch program. When seeing a spike in crime in a neighborhood, police departments often work with groups to bring neighbors together to provide actions and solutions in helping prevent future crime from occurring. Developing these frontline relationships can go a long way in building and maintaining trust between the local government and the citizens that they are committed to serve.
The Big Stick
Local government also has inherent police powers that only they can exercise on a local level. No one else can enforce rules and regulations like zoning codes and traffic laws other than the local government. And it is important to recognize that these police powers themselves do not themselves brand one guilty of a particular infraction; there is still a legal system that is only authorized to proclaim guilt or innocence and levy an appropriate punishment.
But, sticks are important. Sticks help ensure compliance with rules and regulations and those are of paramount importance when we live with other people in the same community. When sticks aren’t uniformly or fairly applied, we often get into a situation where sticks lose their meaning and things can quickly devolve into a level of chaos. For example, if you knew you could get away going 45 mph in a 25 mph zone, you can quickly imagine other people will be doing 50 mph in no time flat.
The Unique Organization
Local governments by their design are a unique organization that give them abilities and powers that other organizations just simply can’t exercise. For example, local governments are often the only organizations that can receive significant funds from the state or federal government. For a concrete example, look at an environmental remediation project. A new owner of an environmentally polluted area may be precluded from applying for state and federal funds for the study or clean up of a contaminated property; however, a local government can apply for those funds. In this role, the local government takes on the responsibility of applying for administering those funds largely because no other party can take that action.
Furthermore, local governments can create other institutions, such as Community Improvement Corporations, or Business Improvement Districts, that can help implement plans and policies that have been determined to move the community forward. These organizations provide a bit more flexibility and quite a bit less formality in the way they operate and conduct business.
What does all this mean?
It means that when we want local government to take action on something, like a redevelopment project, it’s important to take a step back and think about not only the arguments whether a local government should play an active role, but more importantly, what is the proper role at the proper time for the government to play.
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