Empowerment Zone Report: Building On What Is Known


Mike Field
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Staff Writer

     Baltimore's empowerment zone planners should consider
"reverse commuting" strategies to help some of the city's
unemployed find entry-level jobs in the suburbs and promote tax
breaks for the small-to-medium-sized companies already at work in
the city, according to a report prepared by graduate students in
the Institute for Policy Studies.

     The newly published report examines past efforts to create
jobs and sustainable communities in similar projects across the
United States. It offers a cautionary tale of the danger of
unrealistic expectations and the need for serious, long-term
commitment on the part of all agencies involved. One in a series
of occasional papers produced by IPS, Empowerment Zone Strategies
for Baltimore: Lessons from Research and Experience contains more
than 200 pages of analysis, data, charts and maps detailing
problems and possible solutions to issues ranging from crime,
drug use and joblessness to community infrastructure and housing
stock within two of Baltimore's empowerment zone areas.

     The empowerment zone designation was awarded to Baltimore
and five other cities last year in a competitive process in which
each city had to present the federal government with a
comprehensive plan of action for addressing economic and social
needs within a carefully defined area. In addition to Baltimore,
Atlanta, Chicago, Detroit, New York and Philadelphia/Camden won
the coveted federal designation entitling them each to $100
million in aid and tax credits over a five-year period.

     Baltimore chose three distinct geographic areas within the
city for empowerment zone activities: the largely commercial
Fairfield area in south Baltimore; the residential east side area
stretching from Fells Point northward to encompass the Johns
Hopkins Medical Center; and the residential west side area
stretching from Washington Village in southwest Baltimore through
the University of Maryland to the Sandtown-Winchester area in the
north.

     Although the empowerment zone designation was granted more
than a year ago, not all the program's planned components are yet
in place. A substantial amount of time has gone into planning and
coordinating the effort, which seeks to leverage private, state
and city funds with federal dollars for the greatest possible
impact. The IPS report attempts to identify the ways in which
those funds could be most effectively spent.

     "What we tried to do was pull together all the most relevant
research and experience to show what works--and what doesn't,"
said IPS associate director of research Sandra Newman. 

     Each year, Newman teaches a course to first semester
students in the Institute's master's program in policy studies,
in which she encourages her class to learn by working on
real-life problems.

     "I organize the course around several timely policy problems
including a key issue currently facing Baltimore," Newman said.
"This past summer I talked with a number of knowledgeable
Baltimoreans, and everyone agreed that the empowerment zone was
the most significant policy issue confronting the city. For
better or worse, this is the only urban policy that America
currently has."

     The empowerment zone is a Clinton ad-ministration initiative
that couples tax incentives with social services block grant
funding to achieve long-term, sustainable community development.
Widely touted as a new approach to the country's seemingly
intractable urban ills, one of the first things Newman's class
discovered is that most of the solutions currently being proposed
have been employed in more or less similar forms in other cities
on other occasions. 

     "I would call this a difference in degree rather than a
difference in kind," Newman said. "The biggest difference is
mostly a matter of scale. Many states have experimented with tax
incentives in the form of enterprise zones. And some have even
combined economic development activities with supportive services
for residents--the feature of the empowerment zone legislation
touted as new and unique."

     If similar programs have been tried in the past, then
studying them should prove helpful in predicting which efforts
are likely to achieve the best results, say planning experts. "In
some cases, not much was known in a systematic way of what had
been tried before and what worked," Newman said. "But as
important, no one had pulled all of this information together in
one document."

     One of the findings in the report was that past experiments
with tax incentives have been effective in attracting and
supporting small-to-medium-sized businesses, but generally
ineffective in luring the kind of large manufacturing operations
that once employed tens of thousands of city residents. This
finding could be particularly significant for an empowerment zone
city such as New York, which, at least initially, forecast
substantial job growth through the addition of just such
companies.

     Foremost among empowerment zone goals in every city is the
creation of sustainable employment opportunities among residents.
Many urban ills would wither and disappear, it is widely held, if
inner city residents could find steady, full-time employment. The
problem has long been considered a matter of bringing jobs to the
people, but lately some have begun to suggest that the solution
lies in bringing people to the jobs.

     "The most promising program we identified was the concept of
reverse commuting," said student David Marks, who worked on the
needs assessment and job access sections of the report. "It's a
fairly new idea, pioneered in Chicago, in which the inner city
poor are transported to the high growth suburban job markets." 

     Marks and his classmates identified five main centers in the
Baltimore area currently creating a surplus of entry level  
jobs: the BWI Airport corridor, Hunt Valley, White Marsh, Owings
Mills and Harford County. However several obstacles, including
distance and a historical reluctance on the part of suburban
employers to hire city employees, have prevented the inner city
unemployed from filling those jobs. 

     One advantage to mobility strategies such as reverse
commuting is that they produce immediate results. While job
training and job creation are long-term projects requiring
capital investment and careful planning, reverse commuting
provides employment to qualified workers almost as soon as the
programs are established. 

     "We're largely talking about service sector entry level
employment which typically enables workers to sustain themselves
with a degree of job security, but doesn't offer much in the way
of long-term earnings growth or employee benefits," Marks said.
"For the moment, this is the best we're going to be able to get
for employees who typically have little or no job history."

     Research suggests that job training will have to be a
component of any successful program, but not all job training
efforts are alike. "We have found that these programs need to be
closely tied to the local labor network," said student Lisa
Plimpton, who worked on the demographics and job training
chapters of the report. "Past studies seem to show that
on-the-job training and occupational classroom training work best
for adults, while the focus with young people should be
successful completion of the high school diploma. Dropouts and
people who have received their GEDs simply don't do as well."

     Perhaps not surprisingly, the programs that tend to produce
the best results are often those that involve one-on-one
counseling and close individual case management. "We found that
the employment programs that cost more tend to work better,"
Plimpton said. "The balanced approach advocated in the
empowerment zone process is a good thing. There needs to be a
coordinated effort between job creation and job training for
either to succeed."

     Although the report offers a catalog of urban ills and only
a handful of programs that have experienced limited success,
Newman and her students tend to agree the need cannot be ignored.
"We have to go on trying," Newman said. "This is a very big and
complex problem. If it were easy to solve we would have done so
already. I think we were all encouraged that of the many
strategies that have been tried, some are demonstrably more
effective than others. The challenge is to build on what is
already known."

     "A review of what has been tried in the past is quite
different from diving into something new that hasn't been tried
yet," agreed student Chris Whaling. "In doing our research we met
plenty of people out there with vision and enthusiasm for what
can be done. This report is only a guide, showing what has and
hasn't worked in the past. I hope it will help this project find
the path to success."