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Frustrated builders call it the last straw — a
union-originated Springfield ordinance to require those who get city grants
to contribute to an apprenticeship program. The original proposal, which
came before the City Council on May 20, was amended to make it apply only
to grants of $500,000 or more, but union officials are reportedly trying to
get the threshold lowered. If they are successful, this will become one
more burden in a city already known for being difficult to develop in. An apprenticeship program, as part of an overall
neighborhood development strategy, would be a good way to help minorities
get started in the building trades, but the way this has been presented
makes it more of a burden than a path toward opportunity.
Developers who qualify for grants are usually
dedicated to rebuilding neighborhoods, taking on difficult projects that
don’t make economic sense in traditional terms. They deserve to be
applauded for their efforts. Instead, their successes are greeted with more
restrictions, plus inconsistent and confusing rules. City program managers
often blame unions, and union bureaucrats often blame one particular union
business manager, who is said to be more powerful and politically
influential than all the rest. What is really to blame is the absence of a
neighborhood development policy. Despite the best efforts of the
city’s frustrated economic development staff, rather than being
proactive about neighborhoods Springfield has slipped into a reactive mode,
saying, in effect, “If you insist on redeveloping slum areas, bring
us a proposal. If it fits our rules and our programs, and we can’t
find any other reason to say no, then maybe we’ll provide a minimal
grant.” Developers yearn for a day when the city comes to them and
says instead, “We want to revitalize neighborhoods, and we’re
looking for help to do that.”
“They should be figuring out ways to help
us,” says Ron Fafoglia, executive director of TSP-HOPE, a nonprofit
group that builds affordable homes on Springfield’s east side.
“Instead, they spend all their time telling us why we can’t do
what needs to be done.”
The Enos Park neighborhood is fortunate to be in a
TIF district, one of the few residential areas of the city to have that
distinction. The TIF was put into effect in 1997 as a way to improve
housing and infrastructure. However, neighborhood residents have been
disappointed in the results, because so far none of the money in the TIF
fund has been spent on the rehabilitation of housing, as they had been
promised it would be. Unlike other comparable cities, Springfield requires
all projects receiving TIF funds, no matter how small, to meet prevailing
wage requirements — to pay union-scale wages. The one exception is
that developers have been allowed to use TIF funds for property acquisition
while being given verbal assurance that prevailing wage is not required on
the project. Even so, to gain access to acquisition grants they are
required to sign documents stating that they will pay the prevailing wage.
It is confusing for developers to be given one set of rules verbally while
being asked to sign something else. Another source of confusion: There is a
Springfield ordinance specifying that TIF grants of $25,000 and more
require the prevailing wage, but city staff members say the ordinance
doesn’t mean that grants below $25,000 are exempt. The extra cost of union-scale wages would make most
residential rehab projects even less feasible than they already are in
low-income neighborhoods, where housing prices are lower than elsewhere in
Springfield, one of the lowest-priced housing markets in the country.
Besides, few prevailing-wage contractors are available and willing to bid
on small residential projects, which are more tedious and less lucrative
than new construction or commercial projects.
In a more neighborhood-friendly city like Decatur,
TIF funds have been used to change the face of the Near-West neighborhood.
“Our city has made neighborhood growth and development one of its top
priorities,” said Billy Tyus, assistant city manager in charge of
public relations. Over the past three years, nearly $500,000 in grants has
been provided to homeowners, who pay a 50 percent match. The grants, of as
much as $30,000, are for exterior rehabilitation or the correction of code
deficiencies. So far, 22 such projects have been funded, making a visible
difference along West Main Street between downtown and Millikin University.
The program has been so successful, officials may request another $500,000
allocation to cover other areas of the neighborhood. Not only does Decatur
not require prevailing wage, these small TIF grants don’t even need
City Council approval. “These are private homes, not public
facilities,” explains Greg Crowe, assistant city manager for economic
development. Because there is very little red tape involved, an old
neighborhood has new vitality. That could happen here if policymakers would begin
asking what neighborhoods need rather than how they can add more
requirements to an already dysfunctional system. It only makes sense that
small projects should have fewer restrictions than large projects. It would
also make sense for nonprofit projects to have fewer restrictions than
for-profit developments. What makes the most sense is for Springfield to find
ways to get money flowing back into its blighted inner city, to get boarded
houses rehabbed, to get vacant lots built on, to get tax-burden properties
back on the tax rolls, and to bring old neighborhoods back to life.
Fletcher Farrar, president of Illinois Times, heads the nonprofit Old Neighborhood Rehab Inc., which rehabs
houses in Springfield’s Enos Park neighborhood.
This article appears in Jun 5-11, 2008.
