1990s
Summary
The role of the federal government in housing and urban development continues to diminish to such an extent that proposals are made to close the Department of Housing and Urban Development. Cities and suburbs lead the effort to deal with problems of congestion, poor quality of life, job loss due to globalization and outsourcing, rising costs, and flat wages—all of which make housing increasingly unaffordable to a significant segment of the population. Local governments develop and finance urban development projects by creating public-private partnerships. At the national level, the Hope VI program replaces outmoded high-rise public housing with new low- and moderate-income housing.
Influences
- New technology (e.g., the Internet, mobile phones) stimulates economic growth.
- Urban planning incorporates environmental and ecological concerns.
- North American Free Trade Agreement (NAFTA) (1994) is enacted.
- Significant increase in baby-boom retirement.
- Los Angeles riots (1992) raise minority issues in large urban areas.
- Real estate values decline in the early 1990s and increase in the late 1990s.
- Certain cities play proactive role in a globalized economy.
- Highest population growth in U.S. history.
- U.S. Supreme Court rules that local and state governments may not restrict private property without compensation (Lucas v. South Carolina Coastal Council, 1992).
- Average yearly legal immigration increases from 740,000 during the 1980s to 900,000.
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Policies and Programs
- Environmental Protection Agency Brownfields program (1997) finances redevelopment of contaminated inner-city sites.
- Congress authorizes block grants to states and localities for housing moderate-income families (e.g., the HOME program in the Housing Act of 1990).
- The Hope VI program (1993) tears down old public housing projects and makes the vacant land available to private developers to build mixed-income housing.
- Enterprise Zone/Empowerment Community (1993) directs tax incentives, wage tax credits, special deductions, and low-interest financing to a limited number of impoverished urban and rural communities to “jump start” their economic and social recovery.
- HUD takes actions to preserve HUD-subsidized rental housing as affordable housing.
- The Intermodal Surface Transportation Efficiency Act (1991) requires metropolitan-wide programming for multi-modal systems.
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Institutional Roles
- The federal government promotes increased homeownership for lower-income families, but reduces its role in the design and implementation of projects.
- HUD is decentralized and downsized, and many of its functions are contracted out to the private sector.
- Local public housing authorities contract with private developers to develop Hope VI projects.
- Localities develop Comprehensive Housing Affordability Strategies (CHASs) to design their own local responses to housing problems (HOME program).
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Methods, Tools, and Practices
- Retirement communities and assisted-living facilities are developed for a growing elderly population.
- Inclusionary vs. exclusionary zoning for affordable housing development is debated.
- Building moratoriums are put in place to slow development.
- Local zoning practice provides incentives for increased density.
- Property tax abatement legislation for redevelopment projects is passed in many states.
- Layer-cake financing is used to make development projects feasible.
- Bond financing, taxes, and low-income tax credits.
- States issue industrial development bonds to attract industries.
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Lessons and Outcomes
- Gentrification of some neighborhoods becomes a pattern in many cities.
- Substantial numbers of HUD-subsidized multi-family rental units are converted to market rate housing.
- Large, master-planned communities become prevalent (e.g., California, Florida, Texas, and suburban DC).
- Whites make up less than 50 percent of the combined population of the 100 largest cities in the U.S.
- In many cities, downtown becomes just a node of a larger metropolitan area.
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