During the past two decades, many cities embarked on extensive revitalization plans to spur redevelopment in downtown and surrounding low-income neighborhoods. For some cities the investment has paid off, and they experienced population and employment growth in the 1990s. However, not all city plans have spurred investment, and, in cities undergoing transformation, pockets of neighborhood decay still exist. Why have revitalization plans worked in some cities and not in others? How can cities harness economic growth in their downtowns to spur investment in the surrounding low-income neighborhoods?

Two recent publications shed light on these questions. The Economies of Central City Neighborhoods, by Richard D. Bingham and Zhongcai Zhang, offers an alternative look at renewing inner-city neighborhoods. The authors attempt to quantify the factors affecting neighborhood health and industry location in central-city neighborhoods by comparing neighborhoods with extreme poverty and working-class neighborhoods in seven Ohio cities. Reviving America's Forgotten Neighborhoods: An Investigation of Inner City Revitalization Efforts, by Elise M. Bright, documents inner-city revitalization projects in Seattle, Minneapolis-St. Paul, Portland, Boston, Pittsburgh, and Cleveland by examining the common project characteristics that contribute to community renewal.

Neighborhood Economies

Understanding neighborhood economies can help cities develop sound revitalization strategies. In The Economies of Central City Neighborhoods, Bingham and Zhang note that neighborhood characteristics, business location, and neighborhood health are interrelated. Neighborhood characteristics, including economic strength, often determine where businesses locate. In turn, most businesses locating in a neighborhood strengthen the economy by providing residents with job opportunities and access to goods.

Although much research has been conducted into why businesses locate in specific cities and regions, little is known about location decisions within neighborhoods. Businesses locate in regions and cities for myriad reasons—access to product inputs, markets, transportation networks, and a labor force; low crime rates; and the availability of housing and potential customers. Until now, minimal neighborhood-level data has limited the analysis of neighborhood economies and the effect of business location on neighborhood health. Using data available from the Ohio Economic Development Database, Bingham and Zhang examine the correlation among neighborhood demographic, socioeconomic, labor force, housing, and industrial variables with neighborhood industry employment to explain industry location in neighborhoods in Ohio's seven largest cities—Akron, Cincinnati, Cleveland, Columbus, Dayton, Toledo, and Youngstown. (It should be noted that Bingham and Zhang are wary of extrapolation of their findings to cities outside of Ohio, given Ohio's "old economy" structure.)

The analysis of business locations within neighborhoods reveals similarities in industry location between middle-class neighborhoods (those with less than 10 percent of the population living in poverty) and extreme poverty neighborhoods (those with more than 40 percent of the population living in poverty). The employment totals across industries indicate that job opportunities are equally available in middle-class and extreme poverty neighborhoods—381.75 and 382.91 jobs available per 1,000 residents, respectively. However, a closer inspection shows that in extreme poverty areas overrepresentation of certain industries, such as manufacturing, printing, hospitals, and educational institutions, masks the lack of certain retail and service industries. This factor limits the number of low-skill jobs available to neighborhood residents.

Using regression models, the authors consider the effect of four neighborhood factors—poverty level, number of working-class residents, crime rates, and ethnicity—on business location. Each neighborhood factor is a composite of associated neighborhood characteristics. For example, a high percentage of residents living below the federal poverty level, a high percentage of vacant housing units, and a high unemployment rate are characteristics expected in high-poverty neighborhoods. The models reveal that the correlation between neighborhood characteristics and business location are tenuous for most industries, including manufacturing, construction, transportation, wholesale, and social services. The neighborhood characteristics associated with poverty level, working-class residents, high crime rates, and ethnicity have a limited effect on where businesses in these industries locate. Bingham and Zhang argue that this finding highlights the regional nature of these industries' markets, indicating that strategic location is more important than neighborhood characteristics. Therefore, neighborhood redevelopment strategies that are tied to attracting manufacturing and transportation industries may not succeed.

The exception to this finding is retail, which generally serves neighborhoods. Retail location decisions are negatively affected by neighborhood crime, housing, and poverty variables, which Bingham and Zhang view as a sign that some extreme poverty neighborhoods are underserved. According to the authors, these neighborhoods are underserved not because of the size of the market but because businesses view low-income neighborhoods as unsafe—not as viable places to conduct business. To develop and sustain businesses, strategic revitalization must address underlying factors such as crime and dilapidated housing and storefronts.

Keys to Central City Renewal

Bingham and Zhang's research points to the need for inclusive revitalization plans that address various neighborhood problems, including the need for such neighborhood-serving retail as grocery stores, and link inner-city neighborhoods to the regional economy. Bright's research for Reviving America's Forgotten Neighborhoods supports this assertion. She finds that broad-based revitalization strategies to address neighborhood issues, such as crime, housing, provision of city services, and citizen social capital, that involve resident, industry, and government stakeholders produce positive neighborhood results.

Through literature searches, site visits, and multiple interviews, Bright developed comprehensive case studies of successful inner-city revitalization efforts. Revitalization is considered successful if the changes undertaken to improve the quality of life result in "overall improvement in some of the measures of residents' safety, services, shelter or social capital." Comparison of the cities' renewal strategies reveals that comprehensive strategies are linked to widespread results across each of the quality-of-life factors. Although each city emphasized different priorities, efforts in Pittsburgh and Cleveland, which emphasized safety, neighborhood services (government, business, and social), shelter, and resident social capital equally, had the most positive effect on quality of life.

Bright uncovers several similarities among the six cities' approaches to renewal, which she argues are keys to successful and sustained revitalization. Renewal efforts involving residents in planning and project development result in projects that address resident concerns and help rally support for revitalization efforts. Development of partnerships among residents, the local and federal government, community development corporations, foundations, and private businesses—especially banks—provide much-needed resources and ideas to support and sustain community efforts. To reassure residents that the city supports redevelopment efforts, basic city services such as trash collection, police protection, and code enforcement must be available. Cities that streamline plans to recapture and reuse obsolete, abandoned, or derelict sites also improve the efficiency of revitalization plan implementation. To succeed, the planning and development must also be comprehensive, taking a thorough look at what the neighborhood needs and its link to the city and region. Bright emphasizes that the cities' approaches were closely tied to the factors addressed in the revitalization plans.

Hope for Central Cities

The 2000 U.S. census indicates that cities are experiencing a revival of growth—however slow—providing evidence to local governments, business leaders, and residents that downtown renewal is possible. Despite signs of growth, revitalization of inner cities remains a challenge, and questions still linger about how to spur redevelopment. Reviving America's Forgotten Neighborhoods and The Economies of Central City Neighborhoods offer insight into tools that can be used to promote central city neighborhood renewal in areas previously untouched by revitalization. However, evidence suggests, just as Bright finds, that revitalization plans must be tailored to fit community needs, and approaches should build community support and take community context into account.