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Return Economic Prosperity to Main Street

Concept Sketch from the Downtown Wichita Master Plan. Goody Clancy Architects.

AIA-Accordion

 

AIA Position

The AIA urges Congress to pass legislation to provide targeted incentives to communities that help revitalize downtowns and traditional main streets.

Background

Communities across the country are looking to their traditional main streets and downtown neighborhoods as keys to unlocking economic prosperity. The foreclosure crisis has left many outer suburban subdivisions as ghost towns. Meanwhile, ever-rising traffic congestion is causing more Americans to want to live closer to job centers along main streets and near transit hubs. Local governments are revising long-term plans and amending zoning codes to concentrate growth inward.

Yet federal policy has not caught up, incentivizing precisely the kinds of development that communities are looking to avoid. For more than half a century, federal tax policy has promoted development away from traditional town centers and into sprawling suburbs that force people into ever longer commutes.

This pattern of growth has created more long term costs and maintenance liabilities than it has generated in lasting value and revenues, a fact that has been made tragically clear during the ongoing foreclosure crisis. Despite billions of federal dollars spent on community development, communities still struggle with the cost of implementing plans to revitalize traditional main streets and downtowns.

The Strong Community Tax Incentive Act will help communities meet these challenges by providing an incentive for development on main streets and downtown neighborhoods. The bill authorizes the Department of Housing and Urban Development to approve applications for a limited number of Priority Expansion Zones (PEZ). Once designated, the local government is qualified to access a new Expansion Zone tax-credit bond that can be used to finance a wide range of qualified purposes, including mixed-use development, affordable housing, and complete streets improvements, that help foster vibrant neighborhoods.

By strategically investing in existing communities, the Strong Communities Incentives Act offers many advantages:

The program will add value to existing neighborhoods. Reinvesting in existing downtowns and main streets already served by infrastructure can stimulate growth and economic development. Fostering an environment where people can live, work and play in close proximity will provide people greater freedom of choice in their housing and transportation options.

The program is locally driven. Cities, counties and other local governments know what is best for their community. Local governments will submit applications that describe their need for investment and the land-use policies that will guide strategic redevelopment. The plans may include a vision for a new transit oriented development, a plan to direct growth to a town center, or a strategy to bring businesses and residents back to small town main streets. These plans will compete for designation, and the best will be rewarded.

The program is fiscally responsible. By creating a new tax credit bond, the government can spark investment in housing and infrastructure, but the private sector will ultimately determine whether the projects are worthy of investment. The zones are assigned competitively and the underlying community plans for development will be evaluated by HUD, ensuring that only the best Expansion Zones are supported while providing communities with the flexible, patient capital they need to get projects moving.

The program will spur local reform. In order to secure the subsidized bond incentive, this bill asks local governments to improve land use in specific ways. First, it can only be applied to redevelop existing communities, not greenfield development. Second, each zone will need to allow for mixed use buildings to provide a range of residential, retail and office space. Finally, zoning must allow a level of density that can accommodate new residents and businesses.

This legislation will result in significant benefits that go far beyond the designated communities as effective planning and management within zones will lead to spillover effects. Each zone has the potential to serve as a model for other communities that strive to increase economic opportunity.

Useful Links

Promoting Livable Communities, an AIA research paper on how the federal tax code affects community design and development.

Moving Communities Forward. The AIA-University of Minnesota study on how well-designed transportation projects create great communities.

AIA Center for Communities by Design. Learn how architects and their allies help communities plan their futures.

AIA's 10 Principles for Livable Communities

 

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