Can the federal government save downtown USA?

Phoenix has a challenge shared by many cities in America—downtown blight. My home city in Florida has the same problem and millions of taxpayer dollars at various levels have gone into efforts to upgrade the district that used to be the heart and core of the city.

The Arizona Republic reported on what appears to be a bright note for Phoenix:

“The developer of the downtown Phoenix office and retail project CityScape has received a $12 million loan from a Hispanic organization's community development agency for construction of the Hotel Palomar…A limited-liability corporation under Chicanos Por La Causa's umbrella, Prestamos CDFI, awarded the loan recently to CityScape's developer, RED Development.”

The Prestamos Loan Fund, says the fund website, is “Funded in part through a grant award with the U.S. Small Business Administration.”

The website doesn’t say how much federal money is in play and there’s not a lot about funding or donors or revenue generators. Tax credits are also part of the mix for such community based organizations.

Federal money aimed at a downtown area is nothing new. That’s been the case since I was looking for my first real job.

Curiously, Prestamos’ director wants jobs to go to specific nationalities. The director told The Arizona Republic, "Our community is a Latino community and a minority community in general. And those permanent jobs (at the hotel) are going to be filled by those individuals.”

The director’s statement was similar to a statement made by President Barack Obama’s economic adviser Robert Reich as Stimulus dollars began to fall from the federal money tree upon the states. Reich basically stated white male construction workers shouldn’t expect to benefit from those dollars.

The black unemployment rate suggests those dollars didn’t do a whole lot of good for that race either.

What is striking is that minorities openly declare an area “theirs” but they usually base minority status entirely on skin color. I’ve often brought up the great diversity within the overly broad government label ‘Hispanic.’

Whether the new project in Phoenix will pay off is anybody’s guess. The same goes for Jacksonville where our new mayor, a Democrat, is surely looking for federal dollars (I’m betting) to satisfy certain moneyed constituents with interests in our downtown area. Thus far not much has worked and millions have been thrown at the cause. I would like to see such efforts succeed, however.

Can the federal government save downtown USA? Should billions of federal dollars go to that purpose?

The Arizona Republic sounded a note of caution:

 “The PCDIC and Prestamos are among a dozen organizations in Arizona federally certified to dole out the tax credits…Since the program began, the Department of Treasury has awarded $29.5 billion in tax credits to 594 projects. Whether the new market tax credits measurably improve the economy in low-income areas remains to be seen; no federal agency tracks the success of the program, according to the Government Accountability Office, Congress' investigative arm.”

(Commentary by Kay B. Day/July 21, 2011)

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