Joe McNeely, Healthy Neighborhoods, Inc., and Paul C. Brophy, Brophy & Reilly, LLC

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Volume 11, Issue 1 | August 23, 2016

Since the turn of the 20th Century a broad range of people and institutions have been
concerned with improving neighborhoods in America’s cities. Whether these were
the reformers during the Progressive era fighting for building and safety codes or
business leaders figuring out how to revitalize cities1
in the 1950s and 1960s, actions
to strengthen urban neighborhoods were sometimes part of those efforts.

During the 1970s, there was a remarkable surge in grassroots activity in moderate-income
(i.e. working class and lower middle- income) neighborhoods across the country. It was
well documented in the media and literature2
The National Commission on Neighborhoods
(1977-1979) produced two volumes of case studies of these remarkable organizations3
National centers provided training and support to local groups.

Groups often sprang up in reaction to public projects like highway construction or school
demolition. They turned their energy toward keeping the population they had and attracting
new residents to neighborhoods that had been losing population. The phenomenon blanketed
the country: Jamaica Plains, Boston; the Hill, Providence; North Ward, Newark;
Southeast Baltimore; Manchester, Pittsburgh; Detroit Shoreway, Cleveland; North Toledo;
Hamtramak, Detroit; Southwest Chicago; Blue Hills, Kansas City; Santa Fe Dr., Denver;
Chinatown, San Francisco to name but a few of thousands.

The national convergence of local groups led to significant federal policy changes
including passage the Community Reinvestment Act. For the last 20 years, however, the
national recognition and support of this local energy, and attention to appropriate national
policies for neighborhood revitalization, has largely disappeared. Where did that surge in
national activity, funding, media attention, research and policy come from and where did
it go? What remains and how do we use it to build critical attention to the plight of middle
neighborhoods at this moment?

Where did the energy to revitalize middle neighborhoods come from?

The major upsurge of activity in middle neighborhoods in cities began as community
organizing efforts. The success of that organizing led to enormous policy change for public
and private institutions. The subsequent self-help neighborhood revitalization programs led to a new set of strategies for neighborhood revitalization, many of which are standard practice
today. The growth was from organizing to policy impact programs to strategies.

The organizing was the result of a convergence of three forces.

The first force was progressive organizing by religious institutions and religious institution-funded
community organizations oriented to reducing white flight from cities and
building organizations that could form effective coalitions with inner city minority and civil
rights groups. The thesis was that cities would not survive if they became “black, brown and
nor would there be effective political will for the resource allocations needed for
inner city development without a coalition across the whole city.

The second force was a backlash in blue-collar, white communities resentful of the public
attention and government resources devoted to minority, inner city communities when their
blue-collar neighborhoods in the same cities were suffering their own problems.

A final force was the emergence of white ethnic identity organizing, partially in response
to the emergence of black identity, but also from the efforts of third generation descendents
of southern and eastern European immigrants to reclaim the values and ethnic strength of
the first generation of immigrants.

While it began in community organizing, the movement turned to revitalization projects
and programs to implement its aspirations. National foundations and support groups,
long-time advocates of revitalization approach to community development, encouraged
the expansion of the neighborhood organizations’ agenda and capabilities. The Ford Foundation,
for example, had pioneered such an approach in “the gray areas program” of the
1950s and the Community Development Corporation (CDC) program of the 1960s. The
movement also had intellectual/academic underpinnings and advocates, from Herbert Gans
study of Italian neighborhoods in Boston5
to Jane Jacobs’ advocacy of revitalizing walkable
communities rather than demolishing and starting over with modernistic high-rises6. The
concepts of neighborhood and the strategies of community organizing, mobilizing assets,
revitalizing before dilapidation set in, and finding ways to compete in the market to attract
new residents with assets have antecedents in earlier efforts that include the settlement house
movement of the early 20th century to 1950s and 1960s civil rights opposition to urban
renewal, modifications to the federal urban renewal program in the Neighborhood Development
Program and the Federally Assisted Code Enforcement program.7

As the middle neighborhood organizations with origins in fighting public projects and programs turned their attention to community development projects and programs, they
were grouped with earlier Community Development Corporation (CDC) efforts in more
distressed neighborhoods under the broad term of neighborhood development organizations.
While the Ford Foundation and federal support continued for an early group of CDCs
sponsored by the Ford Foundation, new federal initiatives were more broadly defined to
fit the new universe of neighborhood development organizations. The Carter administration,
for example, initiated programs at in many departments including Housing and Urban
Development (HUD), the Economic Development Administration, the Department of
Labor and Health and Human Services.

Some examples may help illustrate the evolving agendas and the enormous energy at the
grassroots level

  • While fighting blockbusting and white flight in her Austin neighborhood in Chicago
    in the early 1970s, Gail Cincotta encountered and her organization documented
    the disappearance of lending for home mortgages and home improvement loans.
    This withdrawal of bank involvement occurred in spite of the fact, as documented
    in a study by Northwestern University, that her community had assets on deposit
    in banks and savings and loan associations sufficient to completely revitalize itself.
    The disinvestment and discriminatory lending against racially mixed and middle city
    neighborhoods came to be called “redlining,” after the red line the Federal Housing
    Administration drew on a map of the city around neighborhoods it considered too
    risky to insure. Cincotta and her organizers contacted similar middle neighborhood
    community organizations across the country that soon documented similar behavior.
    Cincotta and Shel Trapp, a leading Chicago organizer, created National People’s
    Action to fight redlining in cities across the nation. This group fought redlining wherever
    it was occurring, in distressed neighborhoods or middle neighborhoods that
    lenders judged would lapse into distress and were not deserving of mortgage loans.
    Of course, the inability of buyers to get a mortgage created a self-fulfilling prophecy,
    causing neighborhoods to fall into distress. National Peoples’ Action won support
    from a national organization, the National Center for Urban Ethnic Affairs, led by
    Msgr. Geno Baroni, that was encouraging local organizing in blue-collar neighborhoods
    across the country. Baroni’s researchers and the staff of Sen. William Proxmire’s
    Senate Banking Committee helped further document redlining and create a
    policy framework to address it. Baroni used his extensive contacts in the civil rights
    movement to build a genuine coalition of white ethnic, black and Latino organizations
    to press for the end of redlining. This movement led to the passage of the Home
    Mortgage Disclosure Act (1975) and the Community Reinvestment Act (1977), both
    of which have been instrumental in increasing bank lending in neighborhoods in
    cities and suburbs.
  • In 1968, a neighborhood leader in Pittsburgh, Dorothy Richardson, quietly began
    a program that combined energies from neighborhood residents, banks and savings
    and loan associations, and city government to increase lending in transition neighborhoods. The Neighborhood Services Program (NHS) combined three critical elements,
    and was aimed at middle neighborhoods. The three elements were (1) active organizing
    at the neighborhood level to engage residents in neighborhood improvement,
    (2) a commitment from lenders to provide mortgage loans and home improvement
    and marketing loans in the neighborhood to qualified buyers and owners, with a high
    risk loan pool for those not bankable, and (3) investments from city government in
    infrastructure in the neighborhoods and the use of code enforcement to get landlords
    and homeowners to improve their properties. This middle neighborhoods program
    soon caught on, and with enthusiastic support from the Federal Home Loan Bank
    Board [FHLBB], other NHS programs were started in other cities. By 1979, there
    were 13 operational NHS programs and another 10 in the development stage. This
    successful program to preserve middle neighborhoods was adopted by the FHLBB
    and HUD, and became housed in the Neighborhood Reinvestment Corporation,
    which is now NeighborWorks America, a Congressionally charted corporation.
  • In Baltimore, the South East Community Organization [SECO], which had its origin
    in stopping plans for an interstate highway, and similar groups in five other cities
    engaged in a demonstration program funded by the federal Economic Development
    Administration to spread the revitalization work from housing to commercial areas.
    Going beyond architecturally driven models of the time (parking, brick sidewalks and
    public space improvements), SECO adapted the commercial real estate techniques of
    suburban malls with whom the older neighbor commercials strips competed. Their
    successful model added a central organization combining merchants and community
    leaders; the discipline of coordinated marketing and events; careful market capture
    analysis to determine the right mix of businesses to fill vacancies; and technical assistance
    and funding for business expansion. That model was later adapted to rural areas
    by the National Trust for Historic Preservation under the banner of “main streets.”
    Ironically, Main Streets later reintroduced the concepts in urban commercial districts.

The middle neighborhoods also adopted other proven tools and incentives for revitalization:
historic preservation; pre-purchase housing counseling; creative financing and appraisal
techniques to promote housing rehabilitation and homeownership; and targeted workforce
training directly linked to businesses in the neighborhood. The work in these neighborhoods
by bankers and community activists through activities of banks undertook to meet
the requirements of the Community Reinvestment Act led to a whole new domestic field of
community development banking: leveraged lending techniques by which banks could help
revitalize neighborhoods while still making safe investments and earning a profit.

Where did all this energy go?

There are many reasons that the middle neighborhoods energy and agenda diminished in
importance in urban policy and practice.

First, the presidential administrations of Ronald Reagan and George Bush turned their focus away from neighborhoods and “the urban crisis” and the role of government in saving
cities to dealing with housing and homelessness. For example, Jack Kemp’s focus as HUD
Secretary under President Bush was on reforming public housing. The effect was so lasting
that even the subsequent Democratic administration of President Clinton only marginally
increased resources to neighborhoods through his Empowerment and Enterprise Zones
programs and some increase in appropriations for federal programs like the Community
Development Block Grant Program.

As federal support shifted in the Reagan-Ford administrations, local philanthropy
expanded dramatically to provide support for neighborhood development organizations.
A new set of private, national support organizations grew up: the Local Initiative Support
Corporation (LISC), the Enterprise Foundation, and the Development Training Institute.
Working with local funders, these national organizations created a local infrastructure for
technical assistance, funding and project development that helped stabilize the industry of
neighborhood development organizations across dozens of cities. While some of the original
national apparatus has disappeared, like the National Congress for Community Economic
Development (NCCED) and the National Neighborhood Coalition, today there are city and
state associations of these neighborhood development organizations as well as a National
Association of Community Economic Development Associations (NACEDA), and other
constituency groups of and for community development.

However, national attention, particularly in the philanthropic community shifted from
the middle neighborhoods and community development generally to the issues of homelessness
and poverty. The impact of the Reagan-Bush cuts in cities increased and made especially
visible the number of homeless people. As the plight of the homeless became a constant
front-page story, public support grew for government housing programs to address it; and
finally in the late 1980s, led to new funding. That funding however was most targeted to the
homeless and those deeply in need, not the neighborhood revitalization strategies of the
middle neighborhoods. Similarly, as housing prices rose in strong-market cities and suburbs,
it became clear that housing affordability was becoming its own crisis in America, and considerable
energy was appropriately focused on dealing with the housing affordability crisis.

At the same time, policymakers were becoming acutely aware of the emergence of a new
phenomenon of persistent poverty in concentrated, isolated, mostly minority census tracts
of the hundred largest cities. The phenomenon was amply revealed in the census reports
in 1970-1990 and extensively studied by leading researchers like William Julius Wilson.8
With President Clinton announcing “the end of welfare as we know it,” the plight of so
many desperately poor people garnered the interest of leading foundations that had been
supporting the neighborhood movement. With the focus on poverty alleviation, there was
a growing disaffection with place -based strategies for their failure to eradicate poverty — symbolized by the controversial but influential front-page New York Times Magazine article
by Nicholas Lehman, “The Myth of Community Development”(January 9, 1994). Resources
began to shift from neighborhood revitalization to strategies directly targeted to helping
individual poor people get out of areas of concentrated, isolated poverty and into the mainstream
economy through employment and other personal financial enhancement programs.

What did the neighborhood movement leave behind?

If national attention and national policy innovation is what led to calling the outpouring of
local energy regarding neighborhoods a “movement,” that spotlight moved on to other movements.
Nonetheless, a high level of neighborhood-based activity continues in major cities
across the country. The policies created by the neighborhood movement, like the Community
Reinvestment Act, remain in force. The strategies and programs for neighborhood revitalization
invented or refined in the1970s and 1980s, like early intervention and reversal of disinvestment
in the housing market and neighborhood commercial revitalization, have become
standard practice. Some of the national framework, like the national NeighborWorks America
and the Local Initiative Support Corporation (LISC), continue robust programs of support
and training. Many universities have incorporated some form of community economic development
in their curriculum, even offering specializations or degrees.

Moreover many of the core principles of the middle neighborhood revitalization strategies
are permanently ingrained in community development practice locally and nationally.
These include:

  • the focus on a specific defined geographic area;
  • energizing revitalization when the disinvestment and deterioration has only begun
    rather than waiting until the neighborhood has been virtually abandoned and then
    initiating a process of clearance and redevelopment;
  • a partnership of public, community and private sectors to design and implement
    neighborhood improvement actions;
  • an emphasis on assets in the neighborhood as the driver rather than deficits as it
    often been the emphasis in government programs;
  • a market orientation toward restoring conventional economics and reinvestment in
    a neighborhood;
  • the use of private-sector investment and project development techniques applied
    with social values derived from a genuine community process, including market
    analysis and complex financial structuring; and,
  • a comprehensive approach that integrates residential, commercial and human
    resource development.

While the strategies have been incorporated in best practices, there has been little national
dialogue or discussion of the value and needs of the middle neighborhoods since the early 90s. Some cities have experimented with new configurations of the strategies for a new set
of neighborhoods, like Battle Creek’s, Milwaukee’s and Baltimore’s Healthy Neighborhoods
but there has almost no discussion of a federal government role or support except in the
trade associations of those organizations and the national networks to which they belong.

In 1979, James F. Timilty, the Chairman of the National Commission on Neighborhoods,
ended his letter transmitting the Commission’s report to President Carter by saying, “Now
is the time for a national policy that works in, for, and through the neighborhoods for the
people who live there.” As others have written in this volume, it is still timely to take these
words seriously to build from the energies within America’s middle neighborhoods and to
brighten their future.

1. See for an interesting period piece on how ACTION
tried to generate support for improving neighborhoods.

2. See Henry Boyte, The Backyard Revolution: Understanding the New Citizen Movement, Philadelphia:
Temple University Press, 1981.

3. The case studies were appendices to the Commission’s final report, all of which are at http://catalog.

4. Msgr. Geno Baroni used this phrase in a speech at a conference on Minority Business Development
sponsored by the Federal Reserve Bank of Boston in 1976,. Proceedings are at

5. Herb Gans, The Urban Villagers: Group and Class in the Life of Italian-Americans, The Free Press, 1981.

6. Jane Jacobs, The Death and Life of Great American Cities, New York: Random House, 1961.

7. This chapter provides only a cursory history of a very complex set of activities that focused on neighborhoods
in American cities in the 20th Century. For a far more complete history see Robert Halpern, Rebuilding
the Inner City: A History of Neighborhood Initiatives to Address Poverty in the United States, Columbia
University Press, 1995; and Steven Soifer, Joseph McNeely et al, Community Economic Development and Social
, 2014, chapter 3-4 “History of Community Economic Development,” pp. 91-168.

8. William Julius Wilson, The Truly Disadvantaged: The Inner City, the Underclass, and Public Policy, Chicago:
University of Chicago Press, 1990.

Joeseph B. McNeely is a nationally known expert and consultant on community development and a
veteran community organizer. He is currently president of Metroscape Development, a real estate development
firm focused on Baltimore city. From 2006 to 2015, he served as the initial organizer and first
Executive Director of the Central Baltimore Partnership. In the early 1970s, he was the founding executive
of Baltimore’s South East Community Organization (SECO) and Southeast Community Development
Corporation before serving at the national level in the Carter administration. He then was for 20
years the President of the national Development Training Institute. From 2006-2012, he also served as
Co-facilitator of the Weinberg Fellows program for nonprofit executives at the University of Baltimore’s
Schaefer Center. He has written extensively on community development including a textbook in the field
published by Columbia University Press, Community Economic Development and Social Work (2014).
He has taught graduate courses on community development at several universities in Maryland, New
York and Ohio. Mr. McNeely, an attorney, lives in Baltimore, is the father of twin daughters and is
married to Patricia Massey, a successful real estate developer in Baltimore City.

Paul C. Brophy is a principal with Brophy & Reilly LLC, a consulting firm specializing in economic
development, and neighborhood improvement in legacy cities; the management of complex urban redevelopment
projects; and the development of mixed-income housing communities. Brophy has been a
Senior Advisor to the Center for Community Progress, a Senior Scholar at the George Warren Brown
School at Washington University in St. Louis; a Senior Advisor to Enterprise Community Partners;
and the chair of the Legacy Cities Partnership. Prior to the formation of Brophy and Reilly LLC,
Brophy was the co-CEO of Enterprise Community Partners, and prior to that held executive positions
in Pittsburgh city government working on economic development, and downtown and neighborhood
improvement. Mr. Brophy holds degrees from LaSalle University and the University of Pennsylvania.
He is co-author of three books: Neighborhood Revitalization: Theory and Practice (1975); Housing and
Local Government (1982), and A Guide to Careers in Community Development (2001).