Goals met, but not hopes

TEN YEARS after it began with a rousing rally, Baltimore's empowerment zone program is quietly coming to a close with accomplishments that largely surpassed its goals but fell short of the high hopes some residents had for the transformation of their distressed neighborhoods.

Baltimore's selection in late December 1994 as one of six cities to receive $100 million each in federal funds plus tax breaks for businesses was hailed by political leaders as an unprecedented 10-year opportunity to spark a renaissance beyond the Inner Harbor. And it was embraced by residents of some of the city's most blighted, crime-ridden areas as the salvation of their long-neglected communities.


In the decade since, the effort to revive mostly decayed areas of East, West and South Baltimore has financed millions of dollars in loans to businesses, linked thousands of unemployed and underemployed residents to jobs and helped hundreds of first-time buyers purchase homes.

Some neighborhoods, including Harbor East, have experienced turnarounds, fueled partly by empowerment zone funds but mostly by the eastward shift of waterfront development. The renewal program has aided projects such as the Montgomery Business Park in Washington Village and the Bank One check-processing center in East Baltimore. And it has helped people such as Oyana Harris.


Last year, Harris, 22, a single mother from Poppleton in West Baltimore, completed a pharmaceutical training course funded by the empowerment zone. She works behind the prescription counter at a Walgreens in Park Heights at $9.50 an hour, $2.50 an hour more than she had made in previous jobs as a receptionist and store clerk.

"I was interested in some kind of career, but I never knew how to get a start," she says. "If I had to pay for [the course] alone, I couldn't have done it."

In the areas hit hardest, some residents and leaders had envisioned that the empowerment zone would clear their neighborhoods of open-air drug markets and blighted buildings, turning trash-laden streets into tree-lined boulevards.

They say that stories such as Harris', even multiplied many times over, have done little to fundamentally alter the character of their communities. They say that most of the new jobs are relatively low-paying and that they have seen relatively little new investment.

Harlem Park dreams

Walking through Harlem Park in West Baltimore on a recent Saturday morning, it's easy to understand their feelings. On one street corner, police were arresting two young men on drug charges; on another, yellow tape blocked off a rowhouse that had apparently collapsed, leaving one fewer boarded-up house but one more pile of rubble.

"If you look at the overall results, it is a bit of a disappointment," says former City Councilman Kwame Osayaba Abayomi, pastor of Harlem Park's Unity United Methodist Church and a past board member of the nonprofit set up to oversee the renewal effort. "There were dreams of supermarkets and stores and shopping centers. In a way, they were just that."

Jamie Jenkins, a Harlem Park resident who runs a street-side car-detailing business, says the empowerment zone did nothing about the string of boarded-up houses across the street from his. "It didn't do nothing for me," he says.


Lucille Gorham, a longtime East Baltimore community activist, sounds a similar theme.

"My final thoughts are, 'What did it do? Really, What did it do?' I don't see anything that it did," says Gorham, who lives in a blighted area north of the Johns Hopkins medical complex, a block from the site of the city's 271st homicide this year, which occurred Dec. 15. The area is to be demolished and reconstructed under a renewal plan centered on a biotechnology park.

"This community has a lot of underlying problems that have not been addressed - drugs, unemployment, teenagers not being educated."

Outside observers say the renewal area has produced improvements crucial to the city's future.

"To create jobs was a distinctive achievement in terms of what Baltimore needed," says Robert P. Stoker, a George Washington University political scientist who has been studying the empowerment zone. He praises the program managers for "strategic investments" and says his analysis of business data concluded that the number of jobs increased by 18 percent.

"My expectations were exceeded," Stoker says.


Calling Baltimore a "leader among empowerment zones," Donald Mains, a deputy assistant secretary at the U.S. Department of Housing and Urban Development, which oversees federal revitalization efforts, says, "They have numbers to show that they are reaching people."

Martha Benton has seen the empowerment zone from both sides, as a resident of Douglass Homes public housing in East Baltimore and as a board member from the beginning. The renewal area has provided prospects for "a lot of folks who otherwise would not have had those opportunities," she says.

But she acknowledges limitations. "We just didn't get to everybody," Benton says. "I've been called a little of everything because I served on that board."

The 24-member Empower Baltimore Management Corp. board held its final meeting Dec. 9, designating a smaller group of 10 to oversee what remains, a vastly reduced number of programs to be funded by an estimated $2 million a year over the next several years from the repayment of outstanding loans. Federal tax breaks will continue for businesses through 2009.

At the end of this month, the empowerment zone will end its contracts with the four remaining "village centers" that provided neighborhood links to the program. The other two were closed after minor spending scandals.

Most of the staff will be gone by early next year, including Diane Bell, the president and chief executive officer, who has headed the effort for most of its existence. She will become board president.


The low-key gathering was a marked contrast to the first board meeting, a three-hour affair that was attended by dozens of community residents and featured a talk by Mayor Kurt L. Schmoke.

The initial meeting was held a month after the rally to celebrate the city's designation as an empowerment zone and a week after Vice President Al Gore toured the east side, calling the program a "new chance to succeed."

Signature program

Established by Congress in 1993, the empowerment-zone initiative was one of the signature urban programs of the 1990s. Aimed at distressed neighborhoods, it combined the liberal notion of social service grants with the conservative idea of business tax breaks.

Unlike the HOPE VI public housing program - which focused on replacing decrepit high-rises with mixed-income rowhouse neighborhoods - the empowerment zone emphasized job creation as the cornerstone of community redevelopment and stressed residents' participation.

In Baltimore, hundreds of residents participated in the creation of a book-length proposal for turning troubled communities on both sides of downtown into "neighborhoods of choice" and reinvigorating the underused Fairfield industrial area.


The areas contained a tenth of the city's population, with more than two in five residents living in poverty and one in six adults out of work. But they also had some of the city's most notable assets, including the medical complexes of Johns Hopkins and the University of Maryland, and parts of the waterfront.

In the summer of 1994, officials sent a marching band and baton twirlers to deliver the city's application to the Department of Housing and Urban Development, one of more than 70. When Baltimore was designated six months later as one of six urban empowerment zones - along with Atlanta, Chicago, Detroit, New York and Philadelphia-Camden, N.J. - the euphoria that greeted the announcement overshadowed the caveat that the amount of money was not that big, given the magnitude of the problems and the breadth of the area.

"I said at the beginning that there was an undue amount of hype as to what difference $100 million would make over several years for 70,000 people," says Robert C. Embry Jr., president of the Abell Foundation and a board member from the start. "It wasn't going to change poor neighborhoods into middle-class neighborhoods. It has been spent effectively and honestly."

Officials did not hand out all of the grant money within five years, which was the original intent. And the increase in homeownership in the renewal area was a modest 6 percentage points, falling short of the increase of 30 percent to 50 percent that was anticipated.

But the empowerment zone exceeded its goals for reducing violent crime, which was down 56 percent through last year, far exceeding the 25 percent target.

Officials put the value of investment in the area at about $1.5 billion, nearly twice what had been counted on. That figure includes a $7 million warehouse that opened this summer on the site of the Fairfield Homes housing complex, which was vacated in 1987 and demolished 10 years later.


Jobs found

Nearly two-thirds of the $100 million went to work-force development - including job training, drug treatment and career counseling - and job creation, mostly loans to businesses.

More than 12,000 residents have been aided in finding jobs inside and outside the renewal area, and more than 5,700 jobs have been created within the empowerment zone through the assistance of the empowerment zone or public agencies, according to officials. Both figures exceed goals by about 20 percent.

About a quarter of the money to connect residents to jobs was spent on customized training for residents for jobs in business and industries needing workers.

This month, the empowerment zone held a ceremony at Sojourner-Douglass College for 80 graduates of a program leading to certification as nursing assistants. The empowerment zone paid the $2,380-per-student cost of the six-week program and gave each student a $600-a-week stipend, aiming to place them with hospitals and health care facilities.

Phyllis Young, 47, of East Baltimore says she hopes her certificate will enable her to get a job paying up to $12 an hour, substantially more than the $8 an hour she makes as a housekeeper at a retirement home. "It gives you a chance in life to move on," she says.


A recent study for the empowerment zone board by David W. Stevens, executive director of the Jacob France Institute at the University of Baltimore, found that the median quarterly earnings for those who underwent such training were $3,164, up 70 percent from what they had earned before.

The median quarterly earnings of those with solid work histories rose to $4,541, up nearly 20 percent. "Customized training clearly had a good payoff," Stevens says.

It is unclear just how many of those who got jobs through the empowerment zone are still employed. When one study suggested that only slightly more than half of those who participated in a training program were working two years later, empowerment zone officials increased the emphasis on job retention.

The empowerment zone's willingness to analyze its programs impresses Mayor Martin O'Malley, who came into office halfway through the term of the renewal area. "I found them to be a pretty performance-driven organization before the rest of the city was," says O'Malley, who has made his CitiStat review of government operations a hallmark of his administration.

Counselors say difficulties have continued in finding jobs for those who are hardest to employ, but there have been some successes.

After serving 16 years in prison, says Barry Turner, 45, he was living with his mother in Washington Village this year when he attended a job training class sponsored by the empowerment zone. He then found an $8.50-an-hour job in an auto parts store through a neighborhood career center.


"It's been very good," says Turner, who is living with a girlfriend in Cherry Hill outside the empowerment zone. "Right now, I'm trying to find a second job, something at night."

To boost employment, the empowerment zone through the first half of the year funded nearly 90 business loans worth more than $17 million. The biggest loan was $4.5 million two years ago to aid the $100 million conversion of the long-vacant Montgomery Ward building in Washington Village to the Montgomery Business Park.

A loan of $500,000 went to NCO, a collection agency, the building's first private tenant.

A "micro" loan fund that provided a handful of loans of up to $16,000 was closed because it resulted in too many defaults and too few jobs.

Service businesses

A breakdown of loans through the first half of this year shows that the largest category of recipients was service businesses, which received more than $5 million, followed by $2.6 million to restaurants and food services.


Among the latter are two loans totaling $255,000 to the Charleston, an upscale restaurant in Harbor East. The area is booming now, but "it was a desert" when the restaurant opened in the late 1990s, says Tony Foreman, president of the Charleston Group.

The empowerment zone "was the first lender who said yes to us on anything," says Foreman, whose restaurant has about 50 employees, about a dozen of whom live in the renewal area.

The program did not reach its homeownership goal, but it gave grants to help nearly 1,100 first-time buyers with an average income of about $26,000 purchase homes. . Nearly 40 percent of the buyers were in the Washington Village-Pigtown area.

"A lot of people bought the homes they were renting," says Gwyneth Padow, director of housing education for Tri-Churches Housing Inc., a nonprofit that counseled many of the homebuyers. "The negative was, it could have done more for people on fixed incomes who owned homes already."

Carmena F. Watson says the same thing was needed in Harlem Park, where about three dozen buyers took advantage of the program. "A lot of people were older people," says Watson, a lifelong neighborhood resident and a former state delegate. "They needed help with the inside of their houses."

Watson is among those who feels that too little money went to areas of the empowerment zone that needed it most. "I don't think they spread it out enough," she says.


Two reports commissioned by the empowerment zone highlight the uneven nature of the results. The first, two years ago, found that physical investment in the initial six years of the empowerment zone was nearly $400 million in the commercial-residential area that includes Harbor East and Fells Point, but less than $50 million in the poorer residential areas that include Harlem Park and Sandtown-Winchester.

The second report, issued last month, found that from 1997 to last year, assessed property values in Harlem Park increased 6.3 percent while those in the Harbor East-Fells Point area jumped nearly 50 percent.

Not everything is quantifiable. Doris Hall, a community leader in Poppleton, says relationships forged by the empowerment zone helped the community embrace the creation of a University of Maryland biotechnology park just west of Martin Luther King Boulevard. "Had we not had an empowerment zone, we never would have gotten past the politics of having them in the neighborhood," she said.

Over the 10 years, some initial skeptics have become believers, and some early enthusiasts are taking a show-me attitude.

"I had doubts that it was just another program," says City Councilman Bernard C. "Jack" Young, whose districts include much of the east side of the empowerment zone around the Johns Hopkins medical complex. "It was really about helping people. The only disappointment I have is that it's ending."

U.S. Sen. Barbara A. Mikulski, who a decade ago hailed the empowerment zone as a "once in a lifetime opportunity," now says it struck her as "tepid," although she wants to look at data about the effort before final judgment.


Final details years off

It could be years before definitive data is available to fully assess the impact of the empowerment zone. A report this year by the Government Accountability Office on federal revitalization programs, including empowerment zones, said better methods are needed to identify where tax credits are being used. No one had analyzed the effects on poverty, the report said.

The GAO, the investigative and research arm of Congress, is scheduled to report again on the programs in 2007 and 2010.

Analysis of data from the 2000 Census yielded a mixed picture: a decline in the number of people living in poverty and a rise in median household income in most neighborhoods since 1990, but a loss in population and a slight rise in unemployment.

The survey was conducted about midway through the life of the empowerment zone. A more complete picture should emerge from the 2010 count.

By then, the huge biotech park on the east side and the smaller one on the west side should be in operation. The empowerment zone has given $3 million to the east-side project, mostly for property acquisition, and is negotiating to lend the west-side project $3 million from the repaid Montgomery Business Park loan.


In its annual report to HUD, the empowerment zone pointed out that the two biotech parks could eventually have as many as 13,000 employees, although it said that "most of this activity will occur after [the renewal area] sunsets."

At the final board meeting, CEO Bell offered an epitaph to the empowerment zone that speaks to what was done and what might occur as an offshoot. "We have planted the seeds of wealth in areas that people have written off," she said.