Change from the ground up

When Cory Booker became mayor of Newark 32 months ago, he envisioned New Jersey's largest and oldest city becoming America's urban leader in safety, prosperity and the nurturing of family life.

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When it comes to those goals, Booker thinks he and other mayors have a friend in President Barack Obama, whose experience as a community organizer on the streets of Chicago makes him responsive to the needs of America’s cities, whereas the Bush administration was far less focused on urban development.

Just 30 days after taking office, Obama fulfilled his campaign promise to create an Office of Urban Policy that would develop strategies for metropolitan America and ensure that all federal dollars that target city improvements are efficiently spent on the highest-impact programs. Booker met with mayors from around the country in January to draft a policy paper that would assist the new administration in developing protocols for revitalization of urban areas.

While the White House works out its national urban priorities, Newark is a living laboratory for urban renewal, moving toward becoming a national model for clean, efficient energy use, green development and jobs, and housing creation.

“You can not talk about grassroots financial empowerment unless you talk about housing,” Booker said during his state of the city address on February 9, in which he highlighted Newark’s strides over the past few years amidst one of the nation’s deepest economic downturns and announced that he and his staff would focus on economic development and the economic empowerment of Newark residents. “We must make housing opportunities available and more plentiful and more secure for our residents,” he said.

However, like many large U.S. cities, Newark is facing critical deficits, rising unemployment and an avalanche of foreclosures.

Unemployment in the city since Booker took office has risen to 10 percent and Newark ranked 35th highest in the number of foreclosures out of 100 cities in the nation in 2008.

One of the biggest crises Newark faces today is the foreclosure disaster, said Newark Director of Housing and Real Estate Michael Meyer.

As of Q3 2008, one in every 596 homes in Essex County were scheduled for foreclosure. Today in Newark alone, there are estimated to be 900 homes with adjustable rate mortgages that will reset in the next nine months. The majority of those are at 90 percent loan-to-value and in danger of foreclosure. This is a huge problem, not just for the families faced with losing their homes, but for whole neighborhoods.

For every home that gets foreclosed on within a block, it is estimated that the value of the other homes on the block decreases by nine percent, he said.

As foreclosed homes are abandoned, neighborhoods are peppered with patches of blight.

But the broad-shouldered Brick City is fighting back, proving to be as strong and durable as its nickname implies.

To stem home repossessions, the city partnered with a number of entities, creating a foreclosure task force that is hosting loan work- out fairs and conducting surveys street by street, reaching out to households to help them stay in their homes.

Pilot programs launched under the city’s first-ever Abandoned Properties Ordinance are helping to convert abandoned and blighted properties into construction sites for local developers who would increase the city’s stock of affordable housing and create green- collar jobs for Newark residents.

And, a neighborhood program has cleaned up more than 4,850 vacant lots in Newark, a 50 percent increase from those cleaned up during 2007 and an increase of 145 percent since then.

Newark is on a green streak, with twenty parks and public green spaces planned for completion by the end of 2010. At the city’s first-ever Green Future Summit, a two-day conference held in Newark last September, attendees explored everything from green building, clean energy, brownfield mitigation, open space and how best to combine affordable housing with environmentally friendly construction.

Several months later, the city formed a green-collar, on-the-job training program in partnership with local labor groups that is weatherizing the homes of 30 low-income families and seniors. Student workers who take on those projects gain environmentally sensitive construction training and accreditation from Laborers Local 55, while being paid at union rates. They will be able to market their newly acquired skills to the new green construction industry, or find jobs renovating existing buildings.

Booker noted that the program addresses three major issues simultaneously – the global environmental crisis, the city’s crumbing economy and Newark families who are struggling to pay bills and keep their homes. “This initiative provides Newark residents with critical green job skills, reduces Newark’s carbon footprint and enables homeowners to make their homes more energy efficient, saving them both repair and power bill costs. We are turning challenges into opportunities to excel,” he said in January.

Brick City has chalked up a list of notable accomplishments in the face of adversity, including gains in its up-hill battle against violent crime. Newark now leads the nation among large cities for reduction in shootings and murders, achieving a 40 percent reduction in both categories.

Programs designed to empower Newark residents include creation of a fatherhood center and prisoner re-entry program, a charter school fund and a scholarship fund for graduating seniors, the latter of which has awarded scholarships to 18 college-bound students.

And there is the newly formed mentoring coalition and the eleven family success centers that are educating and assisting families with jobs, child care and health needs and a dozen free tax centers that are helping to raise awareness of the Earned Income Tax Credit (EITC) – a program that was expanded during the Clinton administration to provide the working poor with additional income. Thanks to those free tax services, the amount of money Newark residents now claim from state and federal government through the EITC has more than doubled.

Stars shine on Newark
Newark’s recent triumphs and lofty aspirations are attracting celebrities, successful native sons and a number of outside developers and investors interested in contributing to and participating in the city’s renaissance. But with the economic downturn, some of the real estate projects on the drawing board could be stalled for years, or not get built at all. Already several developers planning hotels around the New Jersey Performing Arts Center (NJPAC), home of the Grammy-winning New Jersey Symphony Orchestra, have pulled the plug on their projects.

Still, the area around NJPAC is one of city officials’ top picks for development this year, their hopes for stimulating downtown Newark’s economy pinned on three residential projects there. A mixed-use high- rise, to be built by a partnership of NJPAC and Philadelphia-based urban development specialist Dranoff Properties, was given foremost priority by a scorecard committee convened by the Brick City Development Corporation, an organization formed to spur business and real estate development in Downtown Newark.

Also planned in the area are 150 housing units for Seton Hall Law School students and a $90 million mixed-use high-rise with 152 condos, 6,500 sq. ft. of ground-floor retail and a 154-space parking garage by Borai O’Neal Urban Development, a partnership that includes basketball star and Newark native Shaquille O’Neal.

According to Newark Economic Development Director Stephan Pryor, Borai is acquiring the site of a former science high school just north of NJPAC for $2.75 million, its appraised value minus the up to $1.5 million cost of demolition and cleanup.

All three projects are expected to benefit from the state’s Urban Transit Hub Tax Credit Program, created last year by New Jersey Governor Jon S. Corzine to stimulate downtown development close to light-rail and freight train lines. The program provides tax credits equal to from 80 to 100 percent of qualified capital investments made in a project within an eight-year period. Entities receiving the tax credits may apply 10 percent of the total credit amount per year, over a 10-year period, against their corporate business tax, insurance premiums tax or gross income tax liability.