Welcome to the age of non-profit city government
Can NGOs run cities?
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Sue Mosey spends a lot of time telling stories. When I first met her, she breezed through two hours of narration about the behind-the-scenes practicalities of cultivating a vibrant center in the city of Detroit, a story she is clearly well-practiced at delivering to the many national journalists who come to her with questions. A few days after our meeting, I saw her again at Fourteen East, a Midtown café that opened one year ago after Mosey inspired the owner to host her new venture on Woodward Avenue, Detroit’s central corridor. Mosey was at the café to pose for photographs before meeting a potential funder for lunch, where her strategic storytelling was again called upon — this time, to inspire concrete commitments for the non-profit that Mosey leads, and which, in turn, is headlining the city’s revival.
Home to key anchor institutions — including the Detroit Institute of Arts, Wayne State University and the Detroit Medical Center — the Midtown neighborhood sits just north of the city’s downtown and riverfront. Throughout the last five years, the neighborhood has seen a remarkable revival, with independent businesses veering from national trends to open their doors and restore life in previously dark storefronts. New residents are moving into rehabilitated housing, and community gardens are thriving in what had been vacant lots. Indeed, almost no Midtown businesses were lost during the economic recession — incredible, given that Detroit entered the recession at what might politely be called a disadvantage.
Midtown’s vigor belies the narrative of Detroit as an utterly disinvested city. And coordinating the show is Midtown Detroit, Inc., a peculiarly influential community development corporation that has transformed nearly every aspect of the neighborhood. Founded in 1976 by community activists rooted in the affordable housing movement of the 1960s, Midtown Inc. evolved along with the city. In the last two decades, the scrappy non-profit’s tactical collaborations with major anchor institutions in Detroit — including City Hall — have elevated it from the anti-establishment fringe and into the establishment itself.
While, historically, power in Detroit was synonymous with the auto industry and labor unions, both the decentralization and economic fluctuations of the car business has left space for Midtown Inc. to make its mark on the city. These days, it provides landscaping on boulevard medians. It partners with Wayne State’s police department, which patrols the neighborhood beyond campus borders. It puts strings of lights in the trees along Woodward during the holidays. It is installing LED street lighting. And with its popular Live Midtown initiative, which offers financial incentives to employees of anchor institutions to buy or rent homes in the neighborhood, Midtown Inc. is coming full circle, returning to the business of creating housing options. Even in a shrinking city with a high vacancy rate, Midtown’s apartments are 95 percent occupied.
The organization’s work moved Reuters to describe the neighborhood as “the centerpiece for Detroit’s revival” in an article about the construction of a 21,000-square-foot Whole Foods store on a vacant corner in Midtown. This is the first time the chain has set up shop in a distressed urban center. At the groundbreaking in May, company CEO Walter Robb told the Detroit Free Press that, “the richness that we discovered here was very encouraging. That’s special for me.”
Midtown Detroit, Inc., President Sue Mosey is often called Motor City’s unofficial mayor. Increasingly, the city’s real mayor, David Bing, depends on her and her organization to help manage the city’s neighborhoods. Photo by Marvin Shaouni
The advent of Whole Foods — a retailer that serves as a stabilizer and signifier of a particular sort of bourgeoisie arrival — is a bright feather in the cap of Midtown Inc. President Sue Mosey. Robb credited her for convincing the company to commit to Detroit, as she helped put together the complex financial deal that is backing the new store. While there are many independent grocers and farmer’s markets in the city, Mosey acknowledges that Whole Foods is a game-changer, and not just because more Detroiters will have food choices that parallel those of their neighbors in tweedy Ann Arbor, which got its second Whole Foods in 2007. The store’s opening “not only meets the need for fresh produce, but it signals that something is going on here in Detroit,” said Mosey.
With a remarkable ability to get things done in a city that has been on the brink of state emergency management, Midtown Inc. has a reputation for being better at performing the role of government than government itself. But what are the stakes of ceding public sector work to non-profits? Some argue that if private organizations like this one aren’t making sure trash is picked up and the neighborhood is promoted as a positive place to invest, the jobs won’t get done — and the neighborhood will languish. On the other hand, communities cede a certain amount of accountability when private hands, whether a community development corporation like Midtown Inc. or a for-profit company, take charge of public services.
Is there a risk when common-good public services are — at least some of the time — defined by neighborhood borders rather than city ones? De facto or otherwise, will cities be less likely to make high-quality services and innovation available to all its neighborhoods, or will some be left (perhaps all too literally) in the dark?
Struggle
Burnt-out buildings, abandoned lots, teeming garbage and a heavy-handed police presence. That was what Sen. Robert F. Kennedy saw on his tour of the Bedford-Stuyvesant neighborhood in Brooklyn in February 1966. The impoverished community was the site of one of the decade’s first riots in 1964, as well as a major gerrymandering lawsuit in 1965. Community activists called for “substance, not studies,” as put by Elsie Richardson, Kennedy’s tour guide. Richardson and her team worked with Kennedy’s staff to hone plans for Bed-Stuy’s revival, and 10 months later, after another rough summer punctuated by violence (including the “thing” that kept secretary Dawn from riding the bus home last season on Mad Men), Kennedy announced the nation’s first community development corporation.
Known as the Bedford-Stuyvesant Development and Service Corporation, it pioneered a new model for public-private community development that prioritized both local leadership and professional management. Kennedy, along with Republican Sen. Jacob Javits, laid the groundwork for community development corporations with a special amendment to the Economic Opportunity Act of 1964. The new CDC was not only for Brooklyn’s sake; in his speech, Kennedy spotlighted a seven-point program that he said would serve as a standard-bearer for community development nationwide.
“The program for the development of Bedford-Stuyvesant will combine the best of community action with the best of the private enterprise system,” Kennedy told a group of neighborhood residents assembled at local public school to hear about the initiative that he debuted alongside Javits and Mayor John Lindsay. “Neither by itself is enough, but in their combination lies our hope for the future.”
Built out of the organizing structure of churches, unions and block associations, CDCs were envisioned as a way for citizens to have direct control over their neighborhoods while leveraging the tools of government and business. Since 1967, the first CDC, now called the Bedford-Stuyvesant Restoration Corporation, has constructed or renovated 2,200 housing units and helped bring more than $475 million in investments to central Brooklyn. Meanwhile, the East Los Angeles Community Union was formed in 1968 and was also funded through the Kennedy-Javits legislation. It is now the largest CDC in the country: It builds homes, operates a family of businesses and supports college education for Latino students. Another original CDC, the Mississippi Action for Community Education, was led by a founding team of civil rights activists, including Fannie Lou Hamer, to develop affordable housing for Delta citizens.
Once the U.S. Department of Housing and Urban Development started providing incentives, CDCs took off nationwide, though there is no single legally binding definition of a “community development corporation,” which partly explains the range of their structures, purposes and effectiveness. However, state and federal incentive programs in the 1970s led CDCs to focus more tightly on affordable housing, according to Sam Butler, a board member of Community Development Advocates of Detroit.
“I see it as a social justice issue,” said Butler about the origin of CDCs. Before the advent of CDCs, “unless you were super-rich, you had zero control over space.” In this way, CDCs literally changed the landscape of cities.
Adaptations
Sue Mosey came to what was then called the University Cultural Center Association in 1988. Coleman Young was in his 15th year as Detroit’s mayor (he’d remain in office through 1993). As Mosey describes it, there was not much going on in the city: Few were investing, and fresh ideas were rare. While the city’s prosperous past was visible in its strong institutions — including a world-recognized symphony orchestra, the Henry Ford Hospital and the College for Creative Studies — the neighborhoods that housed them waned. In fact, the mixed-use area now known as Midtown did not exist. The CDC that now bears its name had not yet coined the term to unify the disparate community.
“How do you build institutions when the neighborhood is a real liability?” That was the question Mosey said she faced when she was brought in as Midtown Inc.’s community development director. (Three years later, she became executive director.) Her strategy was to focus on pivotal projects that she felt held the potential to improve the neighborhood while benefitting institutions and bringing lasting good to the city. First step: Getting the neighborhood placed on the National Register of Historic Places so redevelopment projects could qualify for federal tax credits. The move jump-started investment in a place that had been without it for years.
“By the time I came, whole blocks had been removed with urban renewal, which made everything unstable,” Mosey said.
One way to describe Midtown Inc. is to say that it curates development. The non-profit supports carefully chosen projects expected to contribute to a coherent and creative community. It offers stable assistance and a wealth of resources throughout a sometimes-chaotic development process. Through partnerships with local funders and foundations, as well as key city departments, it has seeded at least 40 projects in Midtown — some of them new construction, but the majority historic rehabilitations. By instigating smaller, local development, Mosey said the community demonstrates that “there is a market here.”
Though it remains a neighborhood-based organization — albeit a large and well-funded one comprising more than 100 stakeholders — the influence of Midtown Inc. is amplified in the context of a cash-strapped city. In 2009 — the same year General Motors and Chrysler received government loans, and when a parcel survey revealed that about one-fourth of the city’s residential lots were undeveloped or vacant — the organization reported revenue of about $3.4 million almost entirely in contributions and grants (by last year, that number had more than doubled to over $7.5 million).
At a time when neighborhoods nationwide are struggling to rebound from years of recession, Midtown is experiencing steady growth, with new residents and businesses setting down roots. Photo by Marvin Shaouni
And Midtown Inc. amplifies those funds: In January 2009, it received $2.5 million in grant money over two years to leverage $34 million in government and private funds that would collectively revitalize the Sugar Hill Arts District, a two-block neighborhood with a rich history in jazz music that had been blotted out by urban renewal programs of the 1960s.
Today, the district is home to the N’Namdi Center for Contemporary Art as well as a contemporary art museum and a rehabilitated building designed for artist residences and studios, featuring solar power, geothermal heating and water reclamation. These projects hold disproportionate resonance in a city where officials who are scrambling to keep the lights on don’t have the time or money for bold plans.
Midtown Inc.’s success has made Mosey something of a rock star among those in the economic development circuit. “Fantastically powerful” is how Jennifer Bradley, a Brookings Institution fellow focusing on Great Lakes metropolitan areas, describes the organization and Mosey herself. [Disclosure: Bradley is a previous Forefront contributor. – Ed.]
“They are a great model for an engaged, creative and adaptive institution, and it’s great to see [Mosey] get recognition for that,” Bradley said.
“People have heard about what’s happening [in Midtown], and the work they’ve done is a large reason why there’s so much investment in that neighborhood,” Bradley added. “They had a good vision for what was possible.”
Mosey is not the only contemporary inheritor to the CDC legacy, adapting urban revival to the considerably more market-based reform happening today. But the rising influence of CDCs parallels broader trends in local government that have resonance and relevance beyond the borders of any particular neighborhood.
The Partnered Government
University Circle sits on the east side of Cleveland and, like Detroit’s Midtown, is home to key civic institutions, including Case Western Reserve University, the Cleveland Orchestra and the University Hospitals system. It is served by University Circle, Inc., a CDC that has come to characterize itself as a “community service corporation” in order to better represent the scope of its programming.
The roots of the non-profit corporation extend back more than half a century. It began as a development foundation in 1957 tasked by the Cleveland City Council with being a “service organization to all institutions.” Initially, the foundation functioned as a land bank to assist institutions in expansions. It soon came to develop collaborative services, providing parking, transportation, public safety programs and neighborhood landscaping in order to buoy the area’s cultural and medical centers. In 1970, the foundation re-formed as University Circle, Inc., partly to better bridge the relationship between their community and its bordering neighborhoods, many of them low-income.
Today, UCI (and the Cleveland Foundation, one of the CDC’s biggest supporters) is persistent in characterizing the community it serves not as University Circle, but as “Greater University Circle” in order to suggest a porous border. Along the region’s Euclid Avenue corridor, UCI is responsible for $3 billion in projects, said organization president Chris Ronayne. It has hosted a private police force for decades that employs 25 officers, including plainclothes detectives that patrol the neighborhood and respond to both institutions and residences. UCI operates a bus line and has worked for years to make area streets more welcoming with new pedestrian signage and redesigned intersections that feature pervious concrete, reclaimed timber benches, native plants and a custom-built LED light fixture that doubles as an art piece.


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