Paying Big Dividends

Cathy McMorris Rodgers wants to kill community-building grants, but where would Spokane be without them?

Cathy McMorris Rodgers and her Republican-led House of Representatives intend to kill the Community Development Block Grant Program. (Well, they say “cut” — but a 65 percent reduction? That qualifies in my book as a kill.).

The program’s too costly, they say. Too costly? In comparison to what? The annual CDBG program, for the entire nation, comes to $4 billion, give or take. (Spokane receives about $4 million of it.) Weighed against this $4 billion, consider that we are spending $6.7 billion in Afghanistan every month! And we’re still spending $5.5 billion a month in Iraq — a war that’s supposed to be over.

Need notwithstanding, Republicans have taken a meat ax to any program that appears to serve Democratic constituencies. This would include the poorer CDBG neighborhoods. McMorris Rodgers’ message to her constituents seems to be that it’s OK to fund foreign wars and to go deeper into debt so that the wealthiest can have their “much deserved” tax cuts, but when it comes to our cities’ struggling neighborhoods? They’re on their own.

We need risk takers to keep churning out jobs, and many have stepped forward. During the early days of the recession, in January of 2009, Sue and Pat Kautzman took a chance on an old former garage building on South Perry.

“We saw potential,” recalls Sue. A year later, during the still-dark days of December 2009, South Perry Pizza opened for business. A long shot? Sue observes that 50 percent of all new restaurants go out of business during the first year. And consider that less than a decade earlier, nighttime on lower Perry could be a scary time — blocks of mostly empty buildings, no one in sight. The area was a drug-dealing magnet.

I asked her about that “potential” — what did she see?

“Well, the neighborhood had been improving; lighting was better, nicely done streetscape, it seemed to be a safer place.” And, she pointed out, “Across the street, the cafe was doing well.”

Those important streetscape improvements?

Between 2004 and 2008, CDBG invested all of $130,000 of our tax dollars to help lower Perry establish its preferred identity. The message? As the CDBG program shows us, government can, with just a nudge, make the difference between private success and failure.

South Perry Pizza, as it turned out, “was a smash hit from Day One,” says Sue, quietly wiping a tear of pride. During the summer months, they hire 20 employees. Those are 20 jobs that wouldn’t be around otherwise.

But what economists can’t measure is the civic impact on the neighborhood that this and other South Perry businesses are having. Now there’s a plan for a community garden, and an expanded public market — even direct contributions to the needy in the neighborhood.

“Once a school quarter,” says Sue, “we have our 10 Percent Night. We give 10 percent of our gross to Grant Elementary. Upwards of 90 percent of the kids at Grant [qualify for] free lunch.”

And it hasn’t stopped there. Sue insisted from the start “that all employees who work 32 hours a week get health insurance.”

While I was chatting with Sue, her daughter, Krista, was meeting across the street at the Perry Street Cafe with the South Perry Business and Neighborhood Association. A youngish group, of the 20 in attendance several were under 30 and most in their early to mid-thirties with a semi-senior citizen or two to round things out. And what was their agenda? They were reviewing grant applications from four not-for-profits. Young people. Just getting started. And yes, in this economy. Was I dreaming?

Would any of this have happened without the timely infusion of that CDBG money? I doubt it. As any urbanist will tell you, local improvements are synergistic.

Across town, preservationist and developer Ron Wells agrees. “When we first bought property [in Browne’s Addition] in 1984,” he says, “people were fearful of living in the area.”

All this changed with the CDBG improvements.

The traffic circle on Pacific, constructed in 1992 over the strenuous objections of traffic engineers (what else is new?), at a cost of just $180,000, provided for traffic calming and gave the place a visual center.

“Public perception is 180 degrees from what it was before,” says Wells. “It brought a dramatic focus to the corner.”

Marshall Fowler, the general manager at the Elk, seconds Wells’ assessment. Fowler has recently bought a house off of South Perry. He was at that meeting, too — synergy.

The CDBG programs are small amounts of money that have a big impact. Shannon Meagher of Kiemle Hagood, which manages all the Spokane CDBG housing rehabilitation projects, reports that last year her office gave the nod to 89 projects across the city. Beyond the benefits to the needy, these jobs in turn provided work for upwards of 400 people.

In Spokane County alone, according to Glenn Crellin, director of the Washington Center for Real Estate Research, when the standard 0.7 percent multiplier effect is added into the employee compensation, the impact of CDBG programs comes to more than $20 million a year. The overall total impact comes to nearly $81 million.

Apparently all this community benefit is lost on Congresswoman McMorris Rodgers and her party, driven as it seems to be by ideology rather than common sense If the Republicans get their draconian cuts, it’s estimated that some 700,000 jobs will be lost. What’s more, as we have seen on South Perry and in Browne’s Addition, numbers don’t begin to tell the whole story.

The CDBG budget should be restored, even increased. Perhaps McMorris Rodgers’ party could take money back from Hamid Karzai. He wouldn’t miss it.

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July 29-31
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About The Author

Robert Herold

Robert Herold is a retired professor of public administration and political science at both Eastern Washington University and Gonzaga University. Robert Herold's collection of Inlander columns dating back to 1995, Robert's Rules, is available at Auntie's.