The Department of Housing and Urban Development this week announced 14 new cities as empowerment zones. The list included the likes of Gary, Ind., and East Saint Louis, Ill. Minneapolis was also included in this group — specifically, three low income areas in the city. Minneapolis is fortunate to have been chosen. It is essential that city government recognize that this opportunity is dependent upon Minneapolis becoming a favorable place to do business.
Championed across the political spectrum, the creation of empowerment zones has enjoyed support as an innovative way to fight urban poverty. Going beyond strictly governmental solutions to poverty, the zones seek to encourage private firms to locate in underprivileged areas.
At first glance, Minneapolis might not seem a likely candidate for federal help to fight poverty. A closer look at the numbers, though, reveals two different faces of Minneapolis. While many in the city have benefitted from the state’s record-low unemployment, certain neighborhoods have lagged behind.
Minneapolis has the highest disparity between the income of minorities and whites of any metropolitan area in the nation. In addition, as Mayor Sharon Sayles Belton mentioned in her report to the Department of Housing and Urban Development, 60 percent of the children in these empowerment zones live in poverty. There is definitely need present in Minneapolis.
The three areas of the city that will be targeted as the beneficiaries of this grant include the abandoned Sears complex in south Minneapolis, slated for pollution cleanup, and the near north side and southeast Minneapolis industrial areas.
Minneapolis will receive the first $3 million in funding with an additional promise of $97 million pending congressional approval of the project. In addition the city will realize significant tax advantages as a result of its empowerment zone status. $130 million in tax-exempt bonding finances and $100 million in tax credits will also be included. The federal government must fund this project completely and allow it to move forward. It is a positive sign that Minnesota’s Sen. Rod Grams, generally a critic of government spending, has already expressed support.
By taking advantage of its selection as an empowerment zone, Minneapolis will take a crucial step forward in generating public and private solutions to poverty. Making these neighborhoods attractive to business is what Minneapolis needs to lift its underprivileged citizens. The arrival of new business will provide an engine of growth for these areas.
However, the city must resist the temptation to meddle with the favorable environment that will attract new businesses. Suffocating new rules and regulations will lead to mistrust in the business community and could quickly see the benefits of this program erased.
Minneapolis has a great opportunity to revitalize its crumbling neighborhoods. In contrast to some of the other designated cities, a large portion of this city is already financially solid and can further support the new economic development. Forging greater connections between these two aspects of Minneapolis will generate positive outcomes for both communities.