COLUMBIA — Pat Fowler has come a long way from stacking paint cans behind her front door.
At the far end of her front hall, her kitchen is in a state of organized chaos. Recipes are penciled on the walls. The ceiling is open to the rafters and new insulation.
At the near end of the hall, Fowler eyes a refurbished living room, the first victory in her effort to restore her home on North Sixth Street "to as close to its original condition as (she) can afford."
She peers in with a look of comic guilt as she describes the green and gold of her grandmother’s house, a color scheme she found laughable in her youth.
"Here I am all these years later, and I painted a room avocado," she said.
Fowler is one of many North Central Columbia neighborhood residents improving their properties. A sparsely attended church was converted to an art center for children. Rental properties have been fitted for energy efficiency. Fowler would like to see the degree of personal investment her neighbors put into their homes and their community encouraged.
It’s a trend she fears will flatten under the weight of a blight decree that would be required if the city follows through on a plan to establish an enhanced enterprise zone to create tax incentives for economic development.
Toward that end, the Columbia City Council passed a resolution Feb. 6 establishing an EEZ board and declaring much of the city blighted or near blighted. The whole of the North Central neighborhood fell under the original blanket designation.
The council rescinded that resolution May 7 but already has introduced an ordinance to get the EEZ process back on track by re-establishing the board. Members of the previous board had been revising zone boundaries. Their most recent version excludes Fowler's home but still includes the northern half of her North Central neighborhood.
Promoted by officials at Regional Economic Development Inc. as an incentive to spur job creation by luring manufacturers to Columbia, the EEZ program continues to face strong pushback from residents. Concerns fester in particular around its precursory finding of blight.
Blight’s amorphous definition
Fowler picks her way along an uneven dirt path that cuts through the community garden in the heart of North Central. She pauses to study a mess of vines before turning in delight.
"Oh, look at the strawberries," she says, gesturing toward the tiny gems budding among the tangle.
More foliage grows wild across the street in the lawn of a house with a facade pockmarked with neglect: The paint peels, the porch sags, the door yawns. It is a tick on the body of an otherwise vital community.
"We have probably half a dozen properties that are in that condition," said Fowler, president of the North Central Neighborhood Association. "We’re trying to figure out ways to approach owners constructively about their properties."
Under some state-sanctioned definitions, just one dilapidated house is ample justification for declaring North Central blighted. But discrepancies in how blight is interpreted are among the primary reasons for residents’ angst over EEZs.
Missouri’s EEZ law, Section 135.590 of the Missouri Revised Statutes, defines a "blighted area" as one that is an economic or social liability by reason of:
- The predominance of defective or inadequate street layout.
- Insanitary or unsafe conditions.
- Deterioration of site improvements.
- Improper subdivision or obsolete platting.
- The existence of conditions that endanger life or property by fire and other causes.
- Any combination of such factors.
REDI President Mike Brooks feels "area" is the key word in that definition.
"The premise here is that it's all based on this (census) block group. You will note that there has not been one single reference to any individual home, any neighborhood, any commercial building."
Before it passed the Feb. 6 resolution, the City Council amended it to say that areas within the zone need only display "conditions that lead to blight."
Carol Shoemaker, coordinator of enhanced enterprise zones for the Missouri Department of Economic Development, said at a March 6 forum that blight could amount to something as simple as a cracked sidewalk. At the same meeting, Mayor Bob McDavid said blight had no real meaning at all.
Retired Judge Harold L. Lowenstein recognized the haphazard legal standard in a 2009 piece on blight and redevelopment that appeared in the Missouri Law Review. A finding of blight must cite only one condition that meets the "unsafe or insanitary conditions" provision, he wrote. "(B)light, under such broad constructs, is evidently in the eye of the consultant."
REDI tailored its findings to the business sector in this case, Brooks said. "The information we'll submit for the application only mentions vacant industrial lots, vacant factory buildings. It's going to be the kinds of infrastructure issues that are deteriorating. This is not about picking off people’s properties."
Still, other city officials remained apprehensive about the designation.
On Jan. 25, City Counselor Fred Boeckmann emailed REDI Vice President Bernie Andrews asking for clarification. "I don't see how the proposed enhanced enterprise zone meets the statutory requirement that the area be blighted, have pervasive poverty, unemployment and general distress," he wrote.
But a municipality’s finding of blight often faces much less scrutiny from the state. Lowenstein wrote that the precedent for judicial review is largely deferential. As such, it "is rarely more than a rubber stamp of the finding."
Economic side effects
Although city officials declared blight in February to pave the way for economic development, residents worry that the label will lead to the opposite. Property value ranks high on their list of potential collateral damage.
The value of one’s home depends on multiple factors, such as neighborhood, schools and amenities. Fowler said there also are intangibles, such as public perception of a neighborhood.
In his search for evidence of EEZs’ impact on property values, Brooks compiled real estate data from Springfield — including average home price, percent of asking price received, average days on the market and number of homes sold — into a spreadsheet that spanned 2003 to 2011.
When Brooks shared his work with peers, one pointed to Springfield’s decreased home values in 2008 as evidence of blight’s adverse effect, REDI Chairman Dave Griggs said.
"Real estate values are a matter of the overall economic climate," Griggs said, noting the collapse of the housing market. "Of course (they) have flattened."
But it’s perception that troubles Fowler. "If you give a certain part of town a reputation, it sticks."
She told the story of a "telling" interaction she had with an MU professor who studies poverty programs.
"I told him where I lived ... and he said, 'Really? I always thought that’s where the poor people lived.'" That’s the impression of North Central among those who have not seen it blossom firsthand, she said.
"We’re not seeing a lot of young families move in, even though this is perfectly affordable for them," Fowler said. A blight designation, she said, would compromise the downtown neighborhood’s ability to attract more homeowners and become more vital.
REDI operatives remain unconvinced. They consulted Lee Terry, chief executive officer of the Columbia Board of Realtors, who reached out to counterparts in St. Joseph, Springfield and Jefferson City for information about property values within their EEZs.
"St. Joe was the only community where that Realtor director knew there was an enhanced enterprise zone," Griggs said.
Furthermore, they point to a letter from Allan Moore, owner of REDI investor Moore & Shryock LLC, as evidence that blight has little effect on real estate.
Griggs tapped Moore to ask contacts in other cities whether an enhanced enterprise zone had affected property value. Brooks said Moore "talked to (three of) his peers" in Jefferson City, Springfield and Rolla, two of whom were commercial appraisers.
All three said the designations had resulted in neutral, or even positive, outcomes. In the end, Moore concluded that "the 'blighted area' designation does not adversely affect the buying and selling decisions of market participants."
Tracy Greever-Rice, interim director at the Office of Social and Economic Data Analysis and an opponent of the original EEZ map, found Moore’s report lacking.
"I don’t think we should be basing policy on casual observation and conversation," she said.
Boone County Assessor Tom Schauwecker, the elected official charged with appraising the value of every property in the county for tax purposes, worked with Moore in the 1980s.
"An appraisal," he said, "is an opinion based on facts." Selling prices rely on a multitude of intrinsic and environmental factors. His top three: "location, location, location."
Determining how any variable, including a blight decree, will influence a property would be "speculative," Schauwecker said, adding that a retrospective analysis such as the one Moore did is the best way to examine how certain conditions affect property values.
Griggs argued before the City Council on Feb. 6 that an EEZ could enhance property values. He said he would want his property included in the EEZ because it would increase the chance that someone might buy it, making it worth more.
Greever-Rice said that assessment fits only if the property owner is of the mind to sell. Griggs’ is a "cruel logic" that more acutely affects areas where people are poor or own less real property.
A $35,000 house has fewer tangible indications of value than a $1 million house, Greever-Rice said. Intangibles such as perception, therefore, have a heavier influence on value. Because Americans accumulate wealth through the value of their homes, a blight designation disproportionately affects the pockets of homeowners whose properties stand to lose the most from a negative perception.
"We don't have to take away wealth to create jobs," Greever-Rice said.
Fowler also warned that an EEZ could put homes in danger.
If "you create an incentive for the land under our homes to be more valuable than our homes," she said, "you invite people in to acquire our properties, rezone them, and then they will displace people of modest means that live there."
Opponents of an enhanced enterprise zone also fear that it will put private property at risk of eminent domain. Declaring property blighted, they argue, opens the door for the government to condemn it on the grounds that redevelopment is in the public interest.
Eminent domain is the power vested in governments to take, with "just compensation," private property for public use. The definition of public use, however, has proven just as subjective as that of blight.
The most contentious eminent domain case in recent history began with what has famously become known as "the little pink house." When New London, Conn., condemned Susette Kelo’s home in 2005 to make way for a redevelopment initiative promising 3,000 new jobs and an additional $1 million in annual tax revenue, she sued the city.
Kelo’s became the first eminent domain case in more than two decades to reach the U.S. Supreme Court. The court’s 5-4 decision upheld the governmental practice of acquiring private land and reselling it to private developers, so long as the redevelopment creates a public benefit, such as an increased tax base.
Missouri was one of 42 states to pass legislation limiting eminent domain in the fallout that ensued. House Bill 1944 most notably featured a provision that barred use of eminent domain "for solely economic development purposes."
But that’s no comfort to concerned Columbia residents, who argue the EEZ blight designation and the subsequent desire to eradicate blight function as additional rationale to condemn property.
"Blight and eminent domain are kissing cousins," Mike Martin, who publishes The Columbia Heart Beat, said at the inaugural meeting of Citizens Involved and Invested in Columbia. The political action committee formed in response to the city’s push for an EEZ.
That relationship, however, has an expiration date. The Missouri law also stipulated that acquisition of blighted property for redevelopment can occur no later than five years after a blight designation. That means future city councils will have less leeway than feared.
Faced with similar opposition, leaders in Rolla sought legal opinions regarding the connection between an EEZ and eminent domain. They published a fact sheet that included a comment from attorney Mark Grimm of Gilmore & Bell P.C.
"There is no authorization in the EEZ law for eminent domain and accordingly, cities and counties are not allowed to bring condemnation actions under the EEZ law," Grimm wrote.
When the same quote showed up in a fact sheet REDI presented to the Columbia City Council in February, Brooks was criticized for using Grimm’s opinion out of context despite proper attribution. Brooks said he hadn’t spoken to the attorney when he first published the quote. When they did talk, Brooks said Grimm affirmed his stance.
"He would stand by that comment in that document," Brooks said.
MU graduate student Maurice Harris researched the EEZ program as a REDI intern last year. He said he didn’t consider eminent domain a legitimate consequence of the program because the blight designation covers entire census blocks.
Parcels in a blighted area must be considered individually, according to Section 523 of the Missouri Revised Statutes. A government cannot condemn them unless it finds "a preponderance" of the individual properties blighted.
"If some desperate city tried to (use eminent domain), it would be easily taken to court," Harris said, adding that the cost of condemning and acquiring a census block would be "astronomical."
In light of public fears, state Rep. Chris Kelly, D-Columbia, and other lawmakers pursued legislation declaring that any finding of blight for enhanced enterprise zone purposes cannot be used to meet conditions of blight under any other state statute.
Although the original bill, House Bill 2033, received no action after an April 10 public hearing before the House Economic Development Committee, lawmakers tacked the provision onto a Senate bill last week. The bill was in conference Thursday.
Columbia’s EEZ board, which was dissolved May 7, also voted to introduce similar legislation to the City Council.
"I recommend city staff draft a resolution to council saying that no eminent domain will occur as a result of an enhanced enterprise zone blight designation," board member Carrie Gartner, who also is executive director of the Downtown Community Improvement District, moved March 9 to unanimous approval.
Greever-Rice calls the state and local moves to prevent eminent domain an "empty gesture." Should a legal decision come down to the statutory definition of blight as it relates to an EEZ and eminent domain, she said, neither piece of legislation offers much protection.
"I don't think it would take a very smart lawyer to say, 'Well, (the definitions are) exactly the same words,'" she said.
Brooks acknowledged the blight definitions in state EEZ and eminent domain laws are identical, but he remained adamant that the EEZ statute does not provide for the use of eminent domain.
That’s a difficult argument to make in a community whose history with blight has featured the use of eminent domain. In the 1960s, Columbia’s black business district, the Sharp End, was flattened in the name of urban renewal. Today, the area that includes part of northwestern downtown includes businesses and public housing.
As demolition occurred in Columbia, the definition of blight was experiencing an awkward state of flux.
"Through the first half of the 20th century, blight was understood as a condition of substandard housing," University of Iowa professor Colin Gordon wrote in a 2003 article for the Fordham Urban Law Journal. As late as 1949, blighted areas were federally defined as "predominantly residential."
Between 1949 and 1974, the federal government subsidized urban renewal, helping cities acquire and clear wide swaths of land and then sell them to private developers. Yet legislation didn’t require cities to include housing in redeveloped districts, Gordon wrote. Furthermore, by 1965, up to 35 percent of the federal grants could be spent on commercial development.
"Urban business leaders saw urban redevelopment as a means of loosening the 'dirty collar' of substandard housing that encircled most central business districts," he wrote. "Slums were to be cleared not for better housing, but for a more abstract faith in local economic development and growth."
These days, blight’s residential roots have all but disappeared. Its past consequences, however, remain painfully present.
"What happened in earlier generations ... has created a racial divide in our city that has not healed yet," Fowler said.
Neighborhood activist Traci Wilson-Kleekamp said substantial public input would be one means of closing the rift between city hall and residents.
"We don't exactly have a great track record for how we've treated people of color in the past. We need to be a lot more thoughtful about how we go about doing this process of developing our local economy," she said.
The data debate
Before the council rescinded its finding of blight May 7, half of North Central had escaped its shadow. Fowler explained why she continued to speak out.
"Part of my neighborhood association and neighbors are still affected, so I still have what I call a dog in this fight."
Indeed, the area she specified — "above Wilkes Boulevard all the way to Business Loop, across Providence Road and north of Sexton" — was still within the zone’s boundaries. Fowler said she feared for the small businesses in that area.
"Those are the places where we take our cars to get fixed and our metal soldered," she said. Offering incentives for development would put those business owners, particularly ones who lease their buildings, at risk of displacement.
That blight split North Central is but one example of how outdated census blocks can fail to account for new development. The 2000 census data behind the blight decree fail to reflect Columbia’s progress in some areas.
Columbia’s population grew 28 percent between 2000 to 2010, and new development exists on property that was vacant 12 years ago.
"One really good example of an area that we’ve talked about whether or not to include in the enhanced enterprise zone is the Vanderveen subdivision just north of I-70,"” Greever-Rice said. "That didn’t exist in 2000. The 2000 census data for that part of Columbia is going to be inaccurate."
Greever-Rice illuminated another possible kink in the poverty statistics: students. In a college town such as Columbia, poverty cannot be determined by looking at all households collectively, she said. Family households must be examined specifically, excluding the number of people living in situational poverty due to the college lifestyle, she said.
Greever-Rice used her daughter, a student at MU, as an example.
"As a member of our family, she's not poor. As a young adult figuring it out, she's cash poor," she said. "That totally skews the way poverty looks in Columbia."
John Blodgett, senior programmer and data analyst for the Office of Social and Economic Data Analysis, said it struck him as odd that Department of Economic Development representatives didn’t contact him for help. Blodgett has dedicated more than 30 years to examining and compiling census data.
"I would think they would have checked sources," he said. "Why would you use 12-year-old data when you have more recent data?"”
REDI officials say they didn’t have the option of using more recent data. Joel McNutt, project manager for the state Department of Economic Development, told Andrews in an April 2011 email that 2010 census data was not being used for any of its projects. It’s the state’s job to determine whether certain areas qualify to be in an EEZ.
"We have no control over the data," Brooks said, adding that while 2010 population and household data are available, the same is not true for poverty data.
"So the demographics piece is there," he said. "The psychographic data, if you will, is not."
Blodgett said that doesn’t have to be the case. He could mine the American Community Survey, a long-form questionnaire the U.S. Census Bureau uses to gather economic and other data from a sampling of Americans every month, to come up with more recent poverty numbers.
"It’s more timely, and I think overall that it’s probably better," Blodgett said. "The data are out there. They’re hiding, but they’re out there."
Greever-Rice added, however, that the American Community Survey data can contain large margins of error. She thinks that might be why the state relies on 12-year-old numbers.
"When you get to the point that you’ve decided on which economic development tools you want to use," Greever-Rice said, "then you have to respond to the state, or whoever’s offering those tools, using the process that they have in place and the data that they require."
Where REDI might be at the mercy of the state, the state is at the mercy of the computer system employed to crunch the numbers. The current program needs to be updated to include the most recent American Community Survey data, Department of Economic Development spokesperson John Fougere said in an email.
"The new EEZ system will be available by January 2013," he added.
Yet before any decisions are made, and before any ideas are pursued, Greever-Rice said a public conversation about the community’s economic values and goals should take place.
"That conversation needs to be open and transparent, and it needs to use the most current, accurate data available," Greever-Rice said. "We didn’t do that as a community, and there’s no reason not to stop and do that part."
An opportunity for input
Fowler clearly has caffeine on the brain.
Standing at the rear of the community garden, she becomes animated while speaking of warm weekends and neighborhood coffee conferences to come. As she talks, she points toward a picnic table built from recycled lumber. It’s white-washed and covered in pastel hand prints, a nod to the hands that have contributed so much to North Central.
"This isn’t blight," Fowler concluded. "It’s community."
The untrained eye can easily miss those little details. That’s why Fowler and others want a chance to show city officials where to look. While some would settle for the statute-required public hearing, others would like to see neighborhoods get an official voice.
Dan Goldstein, a leader of Citizens Involved and Invested in Columbia, said the original EEZ board was too exclusive. REDI "is a private company who put together a private board of private investors."
Now that the city has the chance to start from scratch, Goldstein hopes residents from affected communities will have a vote.
An ordinance that would create a new Enhanced Enterprise Zone Board will receive its second reading and be subject to public comment at the City Council’s May 21 meeting. Should the council approve it, members will have a chance to recommend appointees to McDavid.
Goldstein said that regardless of the board’s membership, public opinion should factor into official decisions about an enhanced enterprise zone. If that opinion is negative, he said, the city should explore other options.
"We should be moving toward programs the public can get behind rather than ones they’ve united against."
But, in reference to an introductory economics class, Schauwecker said benefits such as those the EEZ offers often require tradeoffs. With an EEZ, the tax revenue sacrificed at least would result in jobs that could benefit the entire community, he said.
"We’re not going to solve our economic problems until we send people back to work."
Supervising editor is Scott Swafford.
Columbia's blight debate
Timeline | Enhanced enterprise zone debate