Across the country from Camden to Oakland, the contributors engaged with community partnershospitals, churches, community development corporations, community foundations, and other rooted institutionsto help restore old cities to life. Their collaborative thesis project engaged them with one another and university staff; it may offer a new paradigm for graduate education.
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Transforming Cities and Minds through the Scholarship of Engagement
Economy, Equity, and Environment
By Lorlene Hoyt
Vanderbilt University PressCopyright © 2013 Vanderbilt University Press
All rights reserved.
Strengthening Small Businesses
Strategies for Makin' a Way Where There Is No Way in Camden, New Jersey
"We Invest in Our Own"
Dominican and Puerto Rican music pours out the doors of the Caribbean Mega Center, a small electronics store in Camden, New Jersey—a city known for its entrenched poverty, crime, and failing schools. The storefront lights and awning portray a brightly painted beach. José Marrera, the store's owner, describes his place as
a little Best Buy. Everything you can get in there we've got: radios, computers, cell phones, video games. We deal with DJ equipment, car equipment, DVDs, music, video systems, everything at once. People come here because it is cheaper and it saves you time. We've been here for eighteen years. Eighteen years serving the community.
But why is he in Camden? Why not a more affluent city with a better reputation, where doing business might be easier? José insists,
We're from Camden ... raised in Camden. We still live here. That is why the store is here. We love our city. It's not bad here. People think Camden is the worst city anywhere. People have to come here and see for themselves that we aren't bad people. We are good people. We work hard. I think we are friendly with everybody and when you are friendly, people like you. When everyone is nice to each other, you don't have a problem. Camden is not what people think. There is a great opportunity here.
Though business is slower for the Caribbean Mega Center thanks to the recession, José has a track record of success and remains hopeful for the future. He does, however, question the city's economic development strategy. He explains,
They build stuff around the nice parts. They invest in the good, not the bad. If they never invest in the bad, it will stay bad. We invest in our own. We're about to open another store that was abandoned. We bought it, and now we are fixing it to make the street look better. It will be a fruit and vegetable shop, like a little market, Jumbo's Fruit and Vegetables. It is going to be another business coming to the area. (Marrera 2010)
José's entrepreneurial knowledge and his understanding of this East Camden neighborhood raise several questions. Are there other small-business owners with the same determination who care as much as José about the city? And, if so, why does José feel like the city supports only the "nice parts" of town, instead of helping people like him? Would investing in small businesses improve the economy and civic life of the city?
In this chapter, I present a narrative of Camden's dominance and decline, how it tried to turn itself around and why it failed. I argue for a storefront in addition to a waterfront strategy by showing how Camden's small businesses have survived despite the obstacles they encounter. Lastly, I present a set of strategies for unleashing the power of small businesses in Camden and other American cities.
Camden's Dominance and Decline
Camden, New Jersey, was once home to many entrepreneurs and innovators. Jersey tomatoes helped the Campbell Soup Company grow to international fame. New York Shipbuilding Corporation built some of the largest World War I battleships in Camden. RCA, Radio Corporation of America, led the world in the manufacture of "talking machines," and its technology later allowed people to hear the first words uttered from the moon. Both the iconic poet Walt Whitman and the first drive-in movie theater called Camden home. The city's vibrant, ethnically centered, commercial corridors of Broadway, Kaighn, and Haddon Avenues boasted "movie theaters, real estate operations, doctors, dentists, and lawyers mixed with a host of commercial and retail services" (Gillette 2005, 22). Local family businesses thrived during World War I and the Great Depression as they met the needs of their neighbors (Gillette 2005).
Then came industrial decline, white flight, the building of the Cherry Hill mall, the 1971 riots, and various attempts at urban renewal—all of which left Camden, like small postindustrial cities across the country, in a state of decline. In 1973, Mayor Angelo Errichetti explained, "The years of neglect, slumlord exploitation, tenant abuse, government bungling, indecision and short-sighted policy had transformed the city's housing, business and industrial stock into a ravaged, rat-infested cancer on a sick, old industrial city" (Gillette 2005, 89). Today, Camden is one of America's poorest cities. It is also largely uneducated (in 2009, 54.9 percent of high school seniors graduated) and shrinking (the city had 124,555 people in 1950 and has 79,904 today) (CamConnect 2010).
In places like Camden, the challenges of urban decline threaten to overwhelm numerous positive assets. These cities have developed infrastructure, access to a waterway, a walkable downtown, and historic architecture. They enjoy cultural institutions such as universities alongside a wide diversity of immigrant populations, niche markets, and entrepreneurship (Hoyt and Leroux 2007; Fox and Axel-Lute 2008). When it comes to the task of revitalizing cities like Camden, the crucial question is how to leverage assets to overcome the challenges facing these cities and the people who live and work in them. However, selecting which assets should be targeted, and developing an investment strategy around them, is more difficult than it sounds.
Camden's Waterfront Strategy
In 1981, newly elected New Jersey governor Tom Kean and Camden mayor Randy Primas focused redevelopment efforts on what was felt to be the city's greatest asset: the waterfront. Primas considered Baltimore's Inner Harbor redevelopment a successful model that Camden could replicate. "I don't believe you're going to find private-sector investment in the neighborhoods.... The only way to change that is by creating a viable downtown and having it grow from there" (Gillette 2005, 129). By the start of the twenty-first century, Camden's waterfront contained an expanded aquarium, children's garden, minor-league baseball stadium, decommissioned battleship, concert venue, and RCA factory converted into loft apartments. But this investment was not enough to turn the city around: over the two decades that followed, decline steepened to the point where Camden required state-level intervention.
In 2002, New Jersey enacted the Municipal Rehabilitation and Economic Recovery Act (also known as the Receivership Act), placing Camden under state receivership and affecting the direction of redevelopment. The Receivership Act aimed to stabilize the local economy, stimulate investment, and reform municipal government (Kromer 2009). Following the trail laid by previous development decisions—and, inevitably, political interests—$175 million of reinvestment money went largely to grow waterfront tourism and the city's educational and medical facilities (Katz 2009; Kromer 2009). Receivership Act funding passed over community development corporations and nonprofit projects because Receivership Act administrators saw such organizations as too small to create tangible city improvement. John Kromer, former director of city planning and the Camden Redevelopment Agency, a quasi-government department created under the Receivership Act, reflects on the legislation's approach:
In years prior to the Receivership Act, major commitments of state funding had been made to finance development on the waterfront, with relatively little comparable state investment in neighborhoods, and a continuation of this pattern was reflected in the Receivership Act's financing approach: the aquarium received a $25 million allocation of its own, while the city's neighborhoods had to vie for a share of the $78 million available in the two generically designated "neighborhood" funds (some of which would pay for demolition that would not be followed by new development). (2009, 214)
Over the years, some Camden residents and researchers have questioned the way this revitalization strategy focused solely on expanding waterfront tourism and the rooted educational and medical institutions downtown. In 1981, they wondered if Mayor Primas's waterfront focus would create a handful of highly paid professional jobs and many unskilled, low-paying positions to be held disproportionately by minorities (Gillette 2005, 136). In protest of the aquarium expansion, one resident told the Philadelphia Inquirer, "We got two and three families living in one house and beautiful fish living in tanks by themselves" (Gillette 2005, 137). A 2005 resident survey conducted by Camden Churches Organized for People and the Concerned Black Clergy of Camden found only 26 percent of Camden residents felt the three-year-old Receivership Act revitalization was going in the right direction (Ott 2005). Investment in the waterfront and in rooted institutions has had no effect on education, unemployment, poverty, or violence levels. According to Matt Katz (2009), a reporter for the Philadelphia Inquirer: "Camden residents are just as poor today and just as likely to be murdered. They are just as unemployed and lacking in the skills to succeed at work. Their children's reading and math skills are just as abysmal. And the city is twice as reliant on state taxpayers as before."
The failure of Camden's waterfront- and rooted institution-based approach to economic development makes plain that the city needs a new approach. An economically comprehensive revitalization strategy, in which all residents contribute to the city's prosperity, is crucial to creating sustainable, long-term vitality (McGahey and Vey 2008). Acknowledging and leveraging the city's overlooked assets needs to be part of an economic strategy that spurs equitable investment while supporting and serving those who call Camden home.
Investing in Entrepreneurs
In Camden and other cities that have been left behind, small businesses are hidden assets. Valuable as they are, they go unrecognized. Small businesses—defined by the Small Business Administration (SBA) as those firms employing fewer than five hundred people—account for 44 percent of the total U.S. private payroll and employ over half of all private-sector employees. Between 1993 and the third quarter of 2008, they accounted for 14.4 million new jobs, or 64 percent of all the jobs created in that period. In 2004, the number of jobs created by small businesses approximately equaled the number of jobs lost by large firms during that period (U.S. Small Business Administration 2010a).
Small businesses, meanwhile, provide everyday goods and services that residents would otherwise have to leave the neighborhood to get (Boston 2006; Gittell and Thompson 1999; Bendick and Egan 1993). They fill vacant spaces in neighborhoods, reducing blight and bringing vitality and stability (Bendick and Egan 1993). Small businesses contribute to the tax base of the city, increasing the pool of money available to improve citywide services and infrastructure (Gittell and Thompson 1999). Finally, business owners are often important political and social leaders and often serve as spokespeople for community interests (Gittell and Thompson 1999).
In Camden, the time is ripe for the development of small businesses. New leadership, in the form of New Jersey governor Chris Christie and Camden mayor Dana Redd, has made room for strengthening the city's small-business presence. Governor Christie recognized that "efforts to upgrade the downtown waterfront will be undermined as long as Camden's neighborhoods remain unsafe and unschooled" (Hirsch and Walsh 2009). Investing in entrepreneurs is one way to revitalize neighborhoods. At the city level, Mayor Redd expressed her belief that "the strength of our City lies within our children, our families, small businesses, our neighborhoods" (Redd 2010). And "what does not work is top-down planning. It has to be grassroots-driven, in terms of redevelopment and how we revitalize and stabilize our neighborhoods" (Hirsch 2010). In 2011, Camden small-business owners and supporters have a rare opportunity to have their voices heard.
Finally, investing in Camden's small businesses makes sense from a city design perspective. Many small businesses are located in or near commercial corridors, which connect neighborhoods and surrounding suburbs to downtown. Unlike Baltimore's downtown, which redeveloped as an "economic island" from its neighborhoods, Camden's downtown can profit from its linkages with small businesses on connecting commercial corridors (Levine 1987). The size of buildings on many commercial corridors fits the square-footage requirements of small-business owners, and zoning often permits business use. Indeed, there is already evidence of small-business success on Camden's Federal Street. Businesses there, like Marrera's Carribean Mega Center, "have boosted a grassroots redevelopment effort as the city struggles to attract major employers" (Conaboy 2010).
These small businesses provide residents with jobs and may draw outside shoppers with Federal Street's unique concentration of Latino stores. Federal Street is slowly proving that a corridor of small businesses can revitalize an area and spur additional development (Lamboy 2009a). Following the Federal Street example, small businesses on and around other commercial corridors can improve Camden's economy, provide jobs, attract outside shoppers while meeting residents' needs, and beautify the city.
Imagining a Storefront Strategy
What would Camden be like today if a portion of the state-funded Receivership Act had gone to support small businesses? A quick, back-of-the-envelope calculation shows the potential impact if Receivership Act administrators had allocated $10 million, or approximately 6 percent of the total $175 million—less than one-half the funding that went into expanding Camden's one aquarium—to small businesses. If each new business received $160,000 of support, perhaps $80,000 to obtain a commercial property, $35,000 in a business loan, $2,500 in entrepreneurship training, and the remaining $42,500 for building improvements, the $10 million could have opened sixty-two new businesses. To be conservative, if each business led to four new resident-held jobs (at the time of my investigation, Camden's small businesses each actually employed six people on average), the funding would have created 248 new jobs. Dividing these sixty-two businesses among Camden's nine commercial corridors results in approximately seven new businesses per corridor. Filling vacant storefronts to create at least one new whole city block on each corridor sends positive signals to other potential business owners that there is opportunity in Camden. The city government benefits from the tax revenue generated by sixty-two new enterprises, while neighborhoods benefit from sixty-two new leaders and role models working to improve their community.
Imagining a storefront strategy helps to illuminate the potential of small businesses when included in a larger, well-funded plan for economic development. But the reality is that federal and state governments are not likely to bail out the nation's postindustrial cities. The United States does not have enough money to pursue this strategy, even if it wanted to. So, in the absence of such resources, what has Camden already achieved? Where local government and institutions have failed, Camden's residents, especially its small-business owners, have succeeded. Though Camden's small businesses would benefit from proper investment, they have managed to thrive without it. An economic downturn, coming after years of disinvestment, requires us to think creatively about how to revitalize American cities. Camden's small businesses are a wellspring of just this kind of creativity and resiliency. But how have they been successful?
From, For, and Of the City: The Power of Small Businesses
My sample of successful small businesses consists of sixteen diverse enterprises. Three are in the field of construction, three are restaurants, four are involved in other services including a day care and a barbershop, and six are retail. The sixteen businesses are also geographically diverse. Three are on the Federal Street commercial corridor, four on or near River Road in East Camden, two on Haddon Avenue, two on Mt. Ephraim Avenue, three on Broadway, and two in the central business district. These business owners—twelve men and four women—come from all over the globe. They identify as African American, white, Dominican, Puerto Rican, Korean, and Indian. They have had varied life experiences. One graduated from an Ivy League university another worked as an executive in a Fortune 100 firm, and another spent time in prison. Finally, these businesses have been operating for different periods of time. The two businesses that have been open more than fifty years saw the city at its height and have survived its subsequent sustained decline. Four have been open a decade or two, six are between five and ten years old, and five opened their doors fewer than five years ago.
Excerpted from Transforming Cities and Minds through the Scholarship of Engagement by Lorlene Hoyt. Copyright © 2013 Vanderbilt University Press. Excerpted by permission of Vanderbilt University Press.
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Table of Contents
Foreword Dayna Cunningham
Part I: Engaging Economy
Chapter 1 Strengthening Small Businesses: Strategies for Makin' a Way Where There Is No Way in Camden, New Jersey
Chapter 2 Leveraging Rooted Institutions: A Strategy for Cooperative Economic Development in Cleveland, Ohio
Nick Iuviene and Lily Song
Part II: Engaging Equity
Chapter 3 Concentrating Investment: A Strategy for Sustainable Development in Kansas City, Missouri
Chapter 4 Network Organizing: A Strategy for Manufacturing Recovery in Lawrence, Massachusetts
Part III: Engaging Environment
Chapter 5 City-Wide Retrofits: A Strategy for Creating Green Jobs in Oakland, California
Benjamin Brandin and Kate Levitt
Chapter 6 Community/Labor/Utility Partnerships: A Social-Movement Organizing Strategy for Energy Efficiency in Massachusetts
Eric Mackres and Lily Song