Inner-city business push promoted by vice president Forsaken areas again stirring investment interest

Urban America

June 28, 1998|By HEARST NEWSPAPERS

WASHINGTON -- In the face of congressional opposition to its urban agenda, the Clinton administration is finding other ways to fulfill its vision of bringing jobs and development to hard-pressed inner-city neighborhoods.

At a little-noticed White House meeting June 5, Vice President Al Gore was host to chief executives of nine corporations that have invested heavily in building commercial enterprises in poverty-stricken areas. Each used the meeting to make commitments to major expansions.

The meeting, the White House Business and Entrepreneurial Roundtable on Community Empowerment, marked a turning point in the often tenuous relationship between businesses and HTC impoverished urban neighborhoods. After the riots of the 1960s, many retailers and manufacturers shifted investments to upscale neighborhoods, suburbia or industrial zones far from cities. A significant number of urban areas became wastelands with few, if any, jobs or amenities.

However, with the economy improving and urban unemployment down, executives and government leaders gradually are coming to view these same neighborhoods as opportunities. At the meeting, Gore equated investment in impoverished neighborhoods with good business sense.

"By working in partnership with the private sector, we can make our communities and our nation stronger and more competitive," he said.

Henry McKinnell, head of Pfizer Inc.'s pharmaceuticals group, said his company would develop a supermarket, low- and moderate-income housing, and expand a school and industrial space on land it owns near its original and still-operating plant in Brooklyn, N.Y.

And Martin Grass, chief executive of Camp Hill, Pa.-based Rite Aid Corp. pledged to open 40 drugstores over the next two years in economically depressed urban areas nationwide. Last week, the company broke ground for a new 11,000-square-foot store on the site of the former Lexington Terrace housing project on Baltimore's west side.

With prospects for getting new urban rejuvenation programs through the Republican controlled Congress next to nil, the administration is focusing on a host of bully-pulpit efforts such as Gore's business round table.

However, in calling for increased inner-city business investment, the administration is placing itself atop a wave already rolling to shore, said urban specialist Bruce Katz.

Katz, a former official at the Department of Housing and Urban Development, gave the administration high marks for stimulating the urban economy.

Nevertheless, Katz said, "the vice president didn't manufacture these commitments. The corporations aren't doing this out of charity. They're doing it because they know they can profit."

Such investments, Katz added, represent a better-late-than-never recognition that contrary to the general perception, that poor urban dwellers have little disposable income, "these neighborhoods have long been under-served by retail."

Pub Date: 6/28/98

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