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Putting Neighborhoods 2020 in context

Neighborhoods 2020 represents the most recent effort by city officials to rein in the independent neighborhood groups and make them more responsive to the will of City Hall.

South Mpls houses
The perception that NRP was mainly serving white homeowners led many of its critics to call for a restructuring of the program.
MinnPost photo by Peter Callaghan

Now that the controversy over the much-debated Minneapolis 2040 plan has started to subside, another dispute is starting to build over a new city missive known as Neighborhoods 2020. This latest plan is intended to make the boards of Minneapolis’ 70 neighborhood organizations more racially and economically diverse. If adopted by the Minneapolis City Council, the plan would require the neighborhood organizations to meet certain diversity standards for their boards of directors or risk losing city funding.

Neighborhoods 2020 represents the most recent effort by city officials to rein in the independent neighborhood groups and make them more responsive to the will of City Hall. This tug of war between City Hall and the neighborhoods has a longstanding history. Its origins extend back to the early 1990s when the city launched its ambitious Neighborhood Revitalization Program.

Known as NRP, the innovative program was based on the premise that grassroots community organizations, directed by local residents, could reverse the social and economic trends that were destabilizing their neighborhoods. The city pledged to provide $400 million over 20 years to fund action plans created and implemented by the individual neighborhood groups. But this decentralized approach to community development came at the expense of a more centralized effort to establish citywide goals and priorities.

In order to generate broad support for their expansive initiative, NRP’s architects realized that they needed to make NRP a citywide program. Well-to-do districts like Linden Hills and Kenwood would get a piece of the NRP pie along with more economically challenged places such as Near North and Phillips.

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Early years

The idea for NRP first surfaced in the late 1980s when Mayor Don Fraser appointed a citizens task force to examine the development needs of the city’s neighborhoods. The citizens group, chaired by former City Council Member Dick Miller, came up with a long-term approach to neighborhood revitalization, stretching over 20 years. “We had a 20-year plan for street paving so why not a 20-year plan for neighborhood development?” Miller said at the time.

Citing the city’s continuing population loss, Miller’s group called for a fourfold increase in spending on housing improvements and other community-based development occurring outside of Minneapolis’s downtown core. The task force highlighted the neighborhoods’ unmet needs, but did not identify the source of funds that could be used to address those needs. In the past, Minneapolis had been able to rely on a steady injection of federal dollars to help combat urban blight, but that funding source was declining as a result of Reagan administration budget cuts. The man most responsible for urban development spending in Minneapolis, the City Council’s Tony Scallon, realized that the city would need to come up its own source of funding if it was to begin implementing the Miller Committee recommendations.

Scallon, who chaired the council’s Community Development Committee, proposed tapping the revenue streams generated by the city’s tax increment districts. According to Scallon, if the districts were combined together they could provide $20 million a year to fund the Miller Committee’s proposal.

In 1989, a city election year, Scallon’s plan was eagerly embraced by his colleagues, most of whom were running for re-election. They welcomed a way to counteract the widespread perception that Minneapolis was paying too much attention to its downtown and ignoring the needs of its neighborhoods. In 1990, the 20-year neighborhood revitalization plan was formally adopted as a city policy by the mayor and the council.

By now, the Miller task force had been disbanded and new committee, composed of city staff, had been convened to work out the implementation details for the 20-year plan. Chaired by Deputy Mayor Rip Rapson, the implementation committee put together the NRP organizational structure that would remain in place for the next dozen years.

Rapson’s group came up with the concept of a policy board composed of representatives from the various political jurisdictions operating in Minneapolis. In addition to the city, itself, these other jurisdictions included Hennepin County, along with the Minneapolis school, parks and library boards. NRP was to be something more than a city effort even though most of its funds would come from the city’s tax increment districts, known collectively as the Common Project.

Soon, NRP had a new, more ambitious scope that transcended neighborhood boundaries. It was to be nothing less than a major redesign of the services provided by local departments and agencies. NRP would enable grassroots citizens to reshape those services to make them more responsive to neighborhood concerns and priorities. Mayor Fraser voiced the new approach in his 1990 State of the City Address declaring, “We are about to embark on an unprecedented effort to revitalize Minneapolis neighborhoods through a cooperative and coordinated service delivery process involving neighborhood residents. This is the Twenty Year Neighborhood Revitalization Plan. It promises to transform the way services are funded and delivered by the city, the county and our independent park, library and school systems.”

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Power shift

The creation of the interagency NRP Policy Board represented a subtle but significant shift in NRP’s balance of power away from City Hall and towards the neighborhoods. The Policy Board, rather than the City Council, was given the authority to appoint the program’s director, NRP’s key staff job. As its first director, the Board selected Earl Craig, a prominent civil rights and political activist. When Craig died in 1992, the Board hired a Hennepin County official named Bob Miller to replace him.

Miller (no relation to Dick Miller), proved to be an adept bureaucrat who created a political base for himself and his program. As NRP’s long-term head, Miller clashed repeatedly with city officials, including Mayor R.T. Rybak. Even so, these city leaders continued to voice their support for NRP while battling with its director. From the very beginning, elected officials in City Hall had been ambivalent about NRP. City Council members were eager to court the activists in their wards who dominated NRP. At the same time, they viewed those activists warily, seeing them as potential opponents in the next city election.

From a policy standpoint, senior staff in the city’s development and planning departments were concerned with what they saw as NRP’s fragmentation, with its program development and implementation activities spread among 70 separate neighborhood organizations.

Wide latitude

NRP did try to build in some citywide goals into its structure, primarily through a provision requiring each neighborhood to spend at least 52.5 percent of its funds on housing. But this mandate gave each neighborhood wide latitude to determine the type of housing it chose to fund. Most NRP groups opted to meet the housing requirement by offering low-interest home improvement loans and grants to neighborhood homeowners, while allocating fewer of their own dollars for affordable rental housing.

Through the 1990s, NRP continued to gain momentum as a growing number of community groups were able to maneuver their action plans through the city’s complex approval processes. In many neighborhoods, mainly white, middle-class homeowners gained control of their local NRP. While their organizations struggled to involve renters and people of color in the NRP processes, those efforts often meet with limited success.

The perception that NRP was mainly serving white homeowners led many of its critics to call for a restructuring of the program, just as a change in state tax laws was substantially reducing the tax increment revenues used to fund the neighborhood action plans.

By the early 2000s, political pressures and funding limitations were transforming NRP. The ambitious goals voiced by Mayor Fraser in 1990 were now a thing of the past. Rather than supporting expansive development initiatives, NRP was becoming a more modest effort to fund the operating costs and overhead expenses of the neighborhood organizations, themselves. Then, in 2008, another major change occurred when the mayor and the City Council stripped the Policy Board of it authority to manage NRP. The program was brought under the control of a new city neighborhoods department, resulting in Bob Miller’s ouster as NRP’s long-time head.

Now, in 2019, this latest effort to tighten control of neighborhood spending has been prompted, in part, by new budgetary pressures. The tax increment district used to support the 70 community organizations will expire at the end of 2019, leaving those groups with a $4 million budgetary shortfall. Without a dedicated revenue source, the neighborhoods will have to compete with other city programs in order to maintain their city funding.

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The move to make neighborhood groups more diverse represents one more step by City Hall’s current leadership to promote a municipal agenda focused on diversity and equity. Neighborhood groups may applaud this agenda in general terms, while resisting city efforts to limit their autonomy. In any case, the neighborhoods no longer have the power they once had to reshape city policies.

While it may undergo some modification over the next few months, Neighborhoods 2020 is likely to be put in place before the start of its target year.