#087 May/Jun 1996

Empowering Redevelopment: Toward a Different CDC

The community development corporation (CDC) has crept relatively quietly into the struggle to rebuild cities in the last 30 years. CDCs have built housing, started small businesses, and provided social […]

The community development corporation (CDC) has crept relatively quietly into the struggle to rebuild cities in the last 30 years. CDCs have built housing, started small businesses, and provided social services in poor urban neighborhoods and even some rural areas. Lately, CDCs have been popularized by two public television documentaries, numerous press reports, and special setaside funding in the 1990 Federal Housing Act. While there are a few well-publicized successes, there are also many questions about the capacity of CDCs and their methods of operating: whose purposes does the CDC serve, what impacts can it have, and what is its role in the urban political economy?

The many promoters of CDCs cite their housing productivity. They also emphasize success cases such as Fr. William Linders New Community Corporation and BedStuy Redevelopment Corporation. Without CDCs, these advocates contend, there would be no redevelopment in urban Americas most deteriorated neighborhoods. Further, CDCs are more likely than forprofit developers to meet the needs of the poor and even raise expectations that will lead to political pressure for social change.

But some activists and analysts counter that however much housing CDCs produce, they have not reversed social decay, empowered community residents, or changed the balance of power at any political level. Some even wonder if CDCs are a case of social movement cooptation. They charge that CDCs have separated from their grassroots base and become just another developer following a supplyside free market approach to redevelopment, rather than organizing and fighting for the social change necessary to sustain communities. While CDCs have taken on a heroic task in trying to rebuild communities devastated by disinvestment, the lack of CDC success at anything but housing is profound, their funding base is threatened more each year, and the reality of their cooptation is generating more and more disillusionment. An urban redevelopment model that relies almost solely on CDCs, and pushes issues of power to the background, cannot work. Community organizing must be the priority in order for development to succeed.

CDC advocates are again talking about the need to do community organizing. It is unclear, however, whether CDC advocates understand what community organizing is, would want to do it if they knew, or could do it if they wanted to.

The CDC definition of community organizing uses advocacy synonymously with organizing. Community organizers understand organizing as developing relationships so people can press their demands collectively and gain power through that process. Advocacy is an expert speaking for a constituency, rather than helping people speak for themselves. Robert Giloth sums up the problem by noting, There is housing advocacy and development, but little squatting. In other words, working within the rules, CDCs accept what trickles down, rather than helping people mobilize to reclaim whats been taken away.

Even if a CDC understands community organizing, the CDC probably isnt the best vehicle for conducting community organizing. CDCs can produce affordable housing that is affordable and structurally sound. They can train residents in the redevelopment process and occasionally go beyond apartment building to develop coops and other types of affordable home ownership. CDCs probably cant do organizing, however. Constrained by their funding, CDC cannot take the risks necessary to produce empowering community organizing. To understand why this is the case, we need to look at the contradictions within the CDC model itself.

The Contradictions Of The CDC Model

While many CDC directors hold dearly to the goals of community empowerment and political activism, and a few even succeed in reaching those goals, those exceptions only serve to emphasize that the model CDCs have followed and the American political economy, not CDCs themselves, are the problems. As Thomas Lenz noted, CDC practitioners are good people with bad theory, who are also working within a bad system.

From the beginning, CDCs were to accomplish bottomup, comprehensive redevelopment. Some CDCs have been trying to focus their efforts on a smaller scale. But the popular imagination, analysts, major foundationsponsored programs such as the Ford Foundations Neighborhood and Family initiative, and federal initiatives such as the Empowerment Zone/Enterprise Community program have put even more pressure on CDCs to follow this model. The bottomup ideal means helping the community determine how to conduct redevelopment and produce more homes and businesses owned by community members. The whole community ideal means comprehensively treating a communitys social and physical conditions, measuring success in terms of physical redevelopment and community regeneration, participation, and empowerment.

Now, as Rita Mae Kelly said, this model is socialisticsounding but The Socialistic aspect is more apparent than real. For the third part of the CDC model is an acceptance of prevalent freemarket ideology. According to a 1993 article in Economic Development Quarterly by Benjamin Marquez, the CDC model originally attempted to correct three market failures: 1) the inability of potential investors to see opportunities in the neighborhood; 2) profit maximization that prevented socially conscious investing; 3) social/legal restrictions on investment such as zoning laws. However, as government finances have disappeared, CDCs have had to give up this moderate directed capitalism and accommodate themselves to, rather than redirect, the course of the free market. At best, poor neighborhoods are seen as weak markets requiring reinvestment rather than as oppressed communities requiring mobilization, leading CDCs to work within the existing economic rules

This model works by assuming forprofit companies and poor communities have complementary interests. The reality, however, is that corporations and poor communities often have contradictory interests. The conflict starts between individuals: workers and bosses; renters and landlords. But it also becomes a struggle between whole communities and corporate capital. Communities value neighborhood space as use values for the service of community members, creating parks, affordable housing, and community businesses over which they feel some influence. Capitalists, on the other hand, strive to convert neighborhood space into exchange values that can be speculated on for profit, driving up rents, destroying green space, eliminating neighborhoodbased commerce, and disrupting neighboring patterns. Capital is less willing to invest in neighborhood redevelopment that maintains neighborhood spaces as use values because that would prevent speculation and limit profit accumulation. Either through destructive investment, or disinvestment, community suffers.

Most important to this struggle are those in the middle who are neither workers or owners, renters or landlords. The middle class of professionals, managers, and small business owners living in mortgaged housing occupy contradictory locations between the haves and have nots. The middle class is part owner, and part proletariat. This segment of the population controls its own housing, but still pays rent in the form of a mortgage. As a consequence, the middle class is pulled in two directions at once: they resent the banker who controls their mortgage and the renter who lives in the duplex next door; they feel alienated from both the company president and the workers they manage.

It is this insecure and unpredictable middle location that CDCs occupy. CDCs manage capital, like capitalists, but dont invest it for a profit. They manage projects, but within the constraints set by their funders. They try to be community oriented while their purse strings are held by outsiders. Because the contradiction between capital and community lays in the background, presenting itself at every eviction, every housing protest, every strike, every layoff, every foreclosure, every bankruptcy, and every development deal, the CDC is caught between worlds. The result is three problems besetting the CDC model: 1) the myth of community control, 2) the limits to comprehensiveness, and 3) the development of disorganization.

The Myth of Community Control

The belief that CDCs are independent communitybased solutions to urban decay mystifies the reality of external control. Many CDCs even view themselves as the neighborhood voice. This is dangerous, because, as Rachel Bratt has noted and critics and supporters of CDCs agree, CDCs dont necessarily aim for, nor result in, widespread participation by the affected tenants.

Poor communities can only obtain sufficient redevelopment resources to achieve the comprehensiveness ideal by appealing to outside capital. The Local Initiatives Support Corporation (LISC), the single most lauded funder of CDCs, at the local level is controlled by public and corporate officials who often view redevelopment from an exchange value perspective, rather than a use value perspective. Other large foundation supporters of CDCs are little different, evaluating CDC proposals for their economic acceptability rather than their ability to serve community needs.

External control has become more direct, as many CDCs have joined local Chambers of Commerce, and the nationallevel CDCsupport organization,the National Congress of Community Economic Development, joined the National Association of Manufacturers (NAM). Both the Chamber and NAM have a history of opposing legislation benefiting the poor and working classes. CDCs, then, are enmeshed in networks with the enemy, and are consequently limited to development possibilities dictated by capitalists, in the guise of the market, rather than directed by the people.

Here the capitalcommunity contradiction becomes a contradiction between affordability and control. Outside capital resists redevelopment that maintains community control. Government, bowing to market ideology, follows similar rules. Thus, redevelopment that maintains community control is expensive, and redevelopment that is affordable requires giving up control to outside funders. In Minneapolis, the CedarRiverside neighborhood created 550 coop housing units, following leasehold and management cooperative models. But keeping the housing affordable meant accepting subsidies that would force residents to move if their incomes rose too high. Townhouses constructed by the neighborhood provided for more resident control but were also less affordable. In Los Angeles, residents of the Route 2 corridor redevelopment process did not want outsiders involved, and especially didnt want Section 8 subsidized units because of the bureaucracy required, but they couldnt get funds otherwise.

In addition, as CDCs make projects more affordable, the CDCs and the projects become more complex, time consuming, costly, and hard to manage. CDCs often have more complex organizational structures than comparable forprofits, with three quarters having at least one subsidiary. This increasing complexity redirects ever more control to staff, who often live outside of the community and are more likely to emphasize the technical details of development over community empowerment.

Even if a board maintains informed control, it may not represent the community. Businesses, outsiders, the nonpoor, and men are all overrepresented in CDC decision making. Board membership is often selfselecting, achieved only by those who can stomach the technobabble that dominates the redevelopment process.

The overall lack of representative and informed participation can lead to decisions that do not reflect the community, and produce festering resentments. According to Allan David Heskins 1991 book, The Struggle for Community, the controlaffordability contradiction has, created responsibility without control… [and] transformed political questions for the political community into technical questions more accessible to experts. Under these conditions, the CDC model is in danger of creating weaker rather than stronger communities.

The Limits to CDC Comprehensiveness

Struggles and resentments between neighborhood factions over scarce resources sometimes also stem from CDCs inability to meet the comprehensiveness ideal. Comprehensively redeveloping neighborhoods requires expertise ranging from finance, insurance, and real estate to architecture to zoning laws, along with a vast amount of capital. The very things that can make CDCs communitybasedtheir smallness and neighborhood focusinhibit access to the capital and experts that comprehensiveness demands. Propelled by the ideal of comprehensiveness, and the greater availability of project money compared to operating support, many CDCs take on more than they can handle.

Trying to achieve comprehensive redevelopment without sufficient resources can only have one consequence: victimblaming. Here the perception of community control comes into play in a particularly insidious way. Since supporters portray CDCs as communitybased alternatives to government programs, only about half of CDC operating budget needs are met through government sources. Government is also reluctant to commit funds to CDCs because of a lack of CDC productivity. While the lack of productivity is caused by inadequate funding to begin with, developers are believed to fail or succeed based on their skills, not their circumstances. Project failure is attributed to the CDC (and thus the community). When a CDC project manages to succeed in a sea of decay, journalists and observers celebrate that single initiative in a community at serious risk of failure because the CDC cannot keep up with the overall pace of disinvestment. Then when neighborhoods continue to decline, CDCs and their associated communities, rather than corporate disinvestment and government neglect, are left to take the blame.

In addition, as Frances Fox Piven and Richard Cloward argue in regard to antipoverty spending in general, government funding of CDCs may be most useful for maintaining social order. Enough money is provided to stave off social unrest, but not enough to threaten the unequal balance of power.

Despite these limitations, the comprehensiveness ideal itself is valid, because doing too little will not keep up with the pace of centralcity decline. Yet the reality is that CDCs are grotesquely underfunded organizations working in devastated communities requiring massive capital infusion. Of course, the way to get beyond the problem of smallness and the failure associated with it is to access massive resources, which causes yet another contradiction.

The Development of Disorganization

Capitalism is an unpredictable, unstable, unaccountable, disorganizing economic system. When CDCs try to play the capitalist game, they become part of the same disorganizing forces. Community development, when it emphasizes the physical over the social and remains limited to the possibilities dictated by capital, may actually increase turnover, displacement, and otherwise disorganize a community. Economic development strategies that produce jobs without creating community business ownership or community payback from the job providers encourages those who get the jobs to leave. In their community development efforts, CDCs may also compete for public attention with organizing groups, causing conflict within the community and reducing the political power of organizers by making them appear more militant. Even the most successful community-controlled neighborhood redevelopment program in the country, portrayed in my book Defending Community, was torn apart as funding restrictions, inadequate resources, and outsider control of the neighborhood CDC created destructive internal conflict.

So the CDC model potentially increases internal conflict, displacement, and disempowerment both when a CDC fails and when it succeeds. While CDCs try to work where government leftoff, they still depend on government; while they try to be community controlled, they still need to respond to outside schedules and funds; and while they are sometimes effective because they are small, the problems are big.

A New Model

It is too much to expect a CDC to be resistant enough to ward off market pressures attempting to coopt its agenda, accountable enough to remain under community control, yet large enough to do the job thats needed in disinvested communities.

Given that CDCs are not good at maximizing community participation and supporting community organizing, the sensible solution is to do away with the mythology of the CDC as communitybased. Removing the communitybased label accomplishes three things: it removes the possibility of scapegoating the community when redevelopment fails; it admits to the CDCs potential communitydisrupting qualities, allowing residents to better organize to protect themselves; and it removes a competing voice from the neighborhood, allowing residents voices to be heard without the filter of a developer.

Thus, we must also clean up the confusing collage of organizational definitions. Community development corporations, nonprofit housing developers, communitybased organizations, communitybased development organizations, community housing development organizations, and all the other labels only confuse the distinction between community organizing and development. Lets reserve CDC for those organizations that build buildings and community organizing group for those organizations that build community power. And lets be wary of those that refuse to admit their priorities.

If we shift from a development model to a community empowerment model, we can find a place for the CDC that does not so readily contradict community. This new model must emphasize human development and organizing as much as physical development, demand nonmarket solutions to the problems of poverty, be wary of publicprivate partnerships, subordinate development plans to an organizing agenda, and promote community, not CDC, control of physical space.

Organizing groups need to be independent of CDCs because of the danger of funders trying to control controversy and the danger of developers budget needs overwhelming organizing. They must also be organized carefully to prevent homeowners and business owners from dominating poor renters. These principles lead to two components of a new redevelopment model: a communitycontrolled organizing/planning process; and the highcapacity multilocal CDC.

Organize, Organize, Plan

Organizing by itself may work as well as the CDC approach in creating redevelopment. Successful organizing will and should lead to development when organizing is seen as the guiding force that creates the development opportunities, Peter Medoff and Holly Sklar wrote in their 1994 book, Streets of Hope: The Fall and Rise of an Urban Neighborhood. The Dudley Street Neighborhood Initiative (DSNI), profiled in Medoff and Sklars book, focused on organizing as the means to development, while partnering with others to do actual physical redevelopment. In Minneapolis, the CedarRiverside neighborhood residents conducted organizing through their Project Area Committee, limiting their CDC to only implementing plans produced through the organizing process. In San Antonio, Communities Organized for Public Service (COPS) resisted pressure to become a CDC (in the words of their lead organizer, Ernesto Cortes, for the obvious reasons) as they achieved control of much of San Antonios CDBG budget.

Community organizing has become much more difficult, however. Communities are less threatened today by the rogue speculative investor than by disinvestment attacking from the shadows. Capitalist disinvestment has so disrupted community networks that organizing focused on rebuilding neighborhood relationships may be necessary before the community can engage in more public struggle. Defending against, and recovering from, the forces that cause neighborhood decay requires education and planning as much as strategy and tactics.

The most important part of a community organizing model that empowers residents is the planning process, increasingly seen by CDCs as central to development, even if still neglected in practice. The planning process in CedarRiversidewhich converted hundreds of rental units into coops, developed coop businesses, created play space for children, changed traffic patterns, and facilitated community gardensprovides the best example of comprehensive communitycontrolled planning that puts vision before budget. In East Toledo, communitycontrolled planning led to redevelopment of the areas industrial corridor, reviving a major shipyard and retaining the remaining industries. In Bostons Dudley Street community, communitycontrolled planning helped Dudley Street Neighborhood Initiative pressure government to grant them eminent domain powers. In East St. Louis, the planning process became an organizing process, building neighborhood organizations and citizen expertise.

Communitybased planning, if done correctly, accomplishes four purposes. First, it builds a sense of community, becoming an organizing process. Second, it educates residents on what resources and threats exist in their neighborhood. Third, it builds community power, allowing residents to determine what redevelopment they want and thus better defend themselves against speculators. Finally, it helps residents plan for the ideal, without regard to limitations imposed by elites.

The HighCapacity MultiLocal CDC

We must build CDCs with adequate capital capacity. European CDCs produce as much as 55 percent of the housing in Sweden and 35 percent in the Netherlands. When we remove the communitybased mythology from the CDC, individual neighborhoods should neither need nor want their own CDC. Large CDCs have more capital capacity, more political capacity, and more collective talent to conduct physical redevelopment that can outpace community deterioration. Of course, CDCs with greater technical, economic, and political capacity also have greater capacity to overrun community needs. But there are a number of ways to counterbalance these potential troubles.

The most important means of countering the large CDCs power is, as discussed, to develop strong community organizing groups with comprehensive and detailed redevelopment plans. These groups should have enough expertise in the details of redevelopment to construct development contracts that hold CDCs accountable. There are also informal accountability tactics. The CedarRiverside Project Area Committee used its community organizing mission to pack CDC meetings when necessary, meticulously follow each project, and even attempt at one point to disband the CDC when it strayed from community principles. Community organizing groups can collectively press for policies preventing CDCs from operating in poor neighborhoods unless they contribute to independent organizing efforts. They can also demand a share of the city budget, or the LISC budget, or other foundation budgets, to support organizing. The recent establishment of the National Organizers Alliance is likely to produce more collective and wellnetworked organizing talent, making these strategies more realistic.

Fight the Power

Is such a modelreemphasizing community organizing, expanding the capitalization of CDCs, and planning for redevelopment practical or possible?

The first question is whether CDC professionals and supporters will accept a model that reduces CDC power but expands their capacity, and emphasizes that CDCs are good at development, not community. Some CDC advocates will argue that development itself is empowering. But as long as the antagonism exists between capital and community, development alone cannot produce community empowerment, cooperation, and collective action. Others will assert that CDCs can create jobs. Such jobs, however, are usually lowwage and few. A strong, wellfunded organizing campaign could pressure large corporations to provide many more, better paying jobs.

Some advocates of the typical CDC model also dismiss the resurgent community organizing model as manipulative, undemocratic, and outdated. But how can we criticize the poor for their lack of democratic practice, when their experience has mostly been exclusion from decisionmaking? Others may object to an emphasis on community planning, arguing that poor people have not the time, interest, or skills to participate in such endeavors. But such objections border dangerously on elitism. It is only a short step from here to say poor people are too lazy and stupid to do this. While it may be difficult to convince people to attend meetings, especially when they are convinced their participation will be of no consequence, that is the result of an urban redevelopment process that still does not provide real community control and substantial resources. If we put as much energy, talent, and training into community organizing as we put into community development, gaps in participation would be as easy to close as gaps in financing. The cases from San Antonio, Minneapolis, Boston, Toledo, and Los Angeles show that poor and working class people will participate in meetings and planning processes that allow them to express their dreams. Obstructing people from expressing their dreams destroys their imaginations, supports the imposition of artificial limits by corporate capitalists and their government allies, and ultimately accepts injustice.

Finally, CDC advocates may argue that people need housing now, they need jobs now, they need services now. If that is the case, it is equally valid to help people occupy vacant housing now, to help them march now on wealthy corporations laying off workers, to help them protest now to politicians attempting to destroy government at every level. Further, none of this means that CDCs shouldnt continue to serve immediate needs, only that we rethink the kind of relationships they have to poor communities.

There is a larger, more obvious problem: who is going to pay for this new community-driven approach? A federal government in financial tatters, walledin corporations, foundations that trickle minuscule resources on massive problems? Our acceptance of these political realities as technical realities, however, contributes to the problem. Of course development cannot be done without substantial government dollars, hefty private sector participation, and enormous foundation support. But the money is there. Accessing it is a political, not a technical, problem, which requires mobilizing communities to demand action.

Is this proposal too radical and unrealistic? Can funders be convinced to give tens of millions of dollars for comprehensive redevelopment in a single neighborhood? Can they be convinced to give that money in support of neighborhoodbased plans? Can support grow for marketresistant subsidies to communityowned and -controlled businesses that keep wealth in the neighborhood?

The obvious, quick answer is no. No seems to be the answer only because we have come so far down the CDC model path that we have forgotten that the real issue is power, not development. The ideals of a new model that emphasizes community empowerment are unlikely to be achieved in the short term, which makes it even more important that we begin to rethink a redevelopment model that promotes current national and corporate priorities and myths and undermines the potential of communities.

This is a revised version of papers presented at the 1995 Planners Network meeting, the 1995 American Sociological Association meeting, and an on-line seminar, History of Community Organizing and CommunityBased Development, moderated by Wendy Plotkin. Thanks to Tim Mungavan, Ron Randall, Lucy Gerlach, Herb Rubin, Ed Goetz, Angela Stuber, Tim Siegel, Mickey Lauria, John Cabral, Wendy Plotkin, Dave Beckwith, Pedro Huesa, Elliot Smith, Ben Marquez, Harold Simon, and anonymous reviewers for the Journal of Urban Affairs for detailed comments on earlier drafts. A longer, fully referenced version is available from the author at the Department of Sociology, Anthropology, Social Work, University of Toledo, Toledo, OH, 43606; (419)5304975; email: [email protected] or at Comm-Org.



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