ECONOMIC JUSTICE POLICY PAPER


INTRODUCTION

Allentown is a City with an upward trajectory. From manufacturing and the hospitality industry to jobs in healthcare, Allentown is poised for continued growth. Our skyline has changed with the investments in the Neighborhood Improvement Zone (NIZ) downtown and soon at the Waterfront. Cedar Crest College, Muhlenberg College, and the Donley Center at Lehigh Carbon Community College make Allentown a place where young college graduates can stay. Allentown is revitalizing-but not for everyone.

Revitalization and economic development efforts have the potential to uplift residents, but due to a lack of strategic and focused policy, the benefits have yet to trickle down. This is evidenced by the poverty and wealth gaps in Allentown. Employment, poverty, and wage gaps continue to increase between races. According to the Brookings Institute, the Lehigh Valley ranks 47th out of 57 regions in Pennsylvania for inclusion, with the 57th region being the worst for inclusion. Inclusion measures how employment and income changes are distributed among individuals. We are 54th out of 57 in racial inclusion, which looks at the median income, employment, and relative income poverty gap between people of color and whites.

Neighborhoods are being gentrified. Longtime residents and businesses cannot afford to stay in the neighborhood or no longer feel comfortable doing so. The time for Equitable Development is long overdue. Equitable Growth taps into the ingenuity of residents by unlocking opportunities for everyone. There are equitable growth models throughout the Commonwealth that focus on building community wealth, affordability, and neighborhood amenities.

Equitable development:

  • Does not harm current residents and businesses
  • Increases access to opportunity
  • Increases resident’s incomes
  • Supports homeownership
  • Ensures that everyone participates and benefits
  • Protects long-term affordability

We can promote Economic Justice by raising the bar for new development to embed racial equity into institutions, businesses, and City policies and practices. Adopting racial equity focused approaches will move Allentown towards a truly shared prosperity. It will take the efforts of community organizations rooted in neighborhoods and multiracial, multi-sector collaborations. Allentown must confront structural racism and bias through dialogue and action-this is uncomfortable and hard work, but we are ready to take on this challenge.

Investing in people and neighborhoods makes sense economically. Allentown urgently needs equitable development policies to steer growth towards a more inclusive outcome. We must implement intentional and targeted strategies to ensure everyone can live with dignity and prosperity. A thriving economy creates opportunities for everyone to thrive. Economic Development must be approached through a lens of justice, inclusiveness, and equity.

Benefits from development do not naturally trickle down to the people. This takes policy and intentional planning. There are strong correlations between investments in people and neighborhoods and the success of economic development. Investing in the people of Allentown will increase economic development.

Tax incentives alone do not attract companies. Cleaning up brownfields, improving public transportation, and improving distressed neighborhoods will make Allentown better for business development. Cities that offer more amenities in their neighborhoods are more attractive to investors. Ensuring that our residents have the skills needed to fill the jobs means investing and supporting educational opportunities for youth and adults. A skilled workforce will attract developers and companies. Improving human capacities leads to more work satisfaction and increased wages. Improving human capabilities leads to economic development.

As mayor, I will pass policies that invest in the factors that drive business productivity, including workforce development, making land more developable, and helping small and medium-sized manufacturers compete.

Allentown should target incentives based on:

  • How inclusive the project will be
  • The degree that local suppliers will be utilized by the company, which will cycle money through Allentown’s economy
  • The investments in society
  • The hiring of Allentown residents, marginalized communities, and unemployed residents

COMMUNITY BENEFITS ORDINANCE

Allentown has become a bastion of development. However, the benefits from development do not organically trickle down into the community, just as trickle down economics is a farce. To ensure that development actually provides tangible benefits for the people, we must have local policies that help guide developers as to how they can have the greatest impact on the economy.

A Community Benefits Ordinance (CBO) is one method of ensuring that neighborhoods benefit from development. This ordinance would require developers to meet with residents to determine how the proposed project can best help the community. Typically, benefits range from green space, playgrounds, storefronts for entrepreneurs, workforce training, recreational centers, workforce housing, and more.

EMPLOY ALLENTOWN ORDINANCE

I will market Allentown as a Restorative City that invests in its people and provides second chances. We must work with current workforce developers such as the Literacy Center and Workforce Lehigh Valley to expand and enhance their operations. We need to provide more targeted opportunities for Allentown residents to apply for employment. Job fairs and neighborhood satellite employment centers connect employers directly with skilled job seekers who can walk to work.

The City must take the lead and hire qualified Allentown residents for City jobs. We miss out on qualified applicants when nepotism and the “old boys network” are accepted pipelines for job applicants in the City.

The Employ Allentown Ordinance will:

  • Set up an alert system for Allentown residents to learn about City jobs first
  • Create a database of current Allentown job seekers interested in City employment
  • Establish a Work Ready program for youth and adults with employment barriers
  • Host targeted employment opportunities for people with barriers such as criminal records, disabilities, or homelessness.
  • Increase the number of contracts with certified disadvantaged, minority, and women owned businesses
  • Provide incentives to businesses to hire Allentown residents

 

CITY-WIDE DEVELOPMENT

There has not been considerable planning for the Westend, Eastside, or Southside. Moving forward, the city should strategically plan development across Allentown.

The East and Southside have walkable, high transit corridors. Large redevelopment sites like the Allentown State Hospital can bring jobs, business, manufacturing/ industry, housing, and public amenities to the community. There are a number of vacant sites that could support mixed-use development. The Southside and Eastside have parcels of land that could accommodate a 40-80 thousand square foot building near I-78 and U-22. Communities such as Alton Park and Midway Manor provide opportunities for first-time homeowners to have a small community feeling while having access to urban conveniences.

Sustainable development must occur throughout the city. However, we must adjust the zoning code to include more mixed-use areas where commercial, residential and industrial uses can be near one another. Limited Business/Residential is currently a mixed-use zone that enables residential, business, and industrial uses. Manufacturing and healthcare are two higher paying industries with growing markets in the Lehigh Valley, and our zoning must support this demand. Almost 34,000 workers are employed in manufacturing in the Lehigh Valley, and this number will continue to grow.

PATHWAYS FOR ALL

Our strongest economic asset is our people. Economic growth starts with investment in people. Closing the wealth gap is a moral and economic imperative.

The jobs brought into the City have largely not benefited the residents of Allentown. Eighty-two percent of working residents leave Allentown to work at lower-paying jobs. Meanwhile, most of the jobs in Allentown (80%) are held by non-residents.

Many of our residents are commuting to lower paying food & retail jobs or working in warehouses. Many warehouses outsource their hiring to temporary employment services, which typically do not offer benefits, do not pay a living wage, or offer any job security. Some workers commute by bus for 1 or more hours a day after working 10-12 hour physically intense shifts, leading to a lower quality of life and less time to pursue skill advancement opportunities. The lack of sick or personal time is even more critical during a public health crisis.

There’s a mismatch between the job growth in Allentown and the skill set and educational attainment needed to get those jobs. To solve this problem, we must:

  • Attract industries that do not require post-secondary education
  • Invest in customized training and educational programs to prepare residents with the site specific skills
  • Invest in post-secondary education opportunities for residents

Allentown has the opportunity to be a hub for green new jobs. Companies are looking for trained employees to install solar panels, retrofit buildings, and manufacture hybrid car parts. Bringing more green jobs to Allentown has a ripple effect by enhancing the need for lawyers, accountants, consultants, marketing, HVAC mechanics, roofers, surveyors and engineers, and more who have expertise in sustainability requirements.

We must collaborate with companies that specialize in workforce training, such as Careerlink, LCTI, and the Literacy Center, to train Allentown residents so that they can work in the green energy economy.

STRATEGIC INCENTIVES

We must examine the Opportunity Zones and how they affect Allentown residents. While Opportunity Zones present a good opportunity to developers, without local guardrails in place they could also threaten communities fighting to preserve the character and affordability of a neighborhood. Opportunity Zones allow developers not to pay the capital gains tax for ten years. Investors are not required to consult the neighborhood or even the City before development occurs since it is a federally regulated incentive.

The largest tax incentive zone in Allentown is the Neighborhood Improvement Zone (NIZ). Over a billion dollars has been poured into a couple of blocks downtown. Benefits from development have yet to reach the surrounding neighborhoods. One-third of residents living in the Neighborhood Improvement Zone (NIZ) are living in poverty. The Department of Housing and Urban Development recommends that people spend no more than 30% of their income on rent, but for many residents, 75% of their income goes towards the rising rents.

Our poverty rates have not decreased at the same rate as other municipalities with similar demographics that don’t have the one of a kind tax abatement zone, as shown in the table below:

Municipality

Decrease in Poverty Rate %

Allentown

.5%

Reading

2.1%

Harrisburg

2.1%

Lancaster

2.5%

Bethlehem

3.9%

INVEST IN DIVERSITY

Supporting businesses owned by people of color and other marginalized communities helps create generational wealth in the community.  Supporting diverse businesses helps to close the racial wealth gap. The Economic Policy Institute (EPI)  found that the average wealth for white families was seven times higher than the average wealth for Black families. This gap means that Black entrepreneurs tend to have less cash flow and access to capital. According to a Guidant Financial report, 44% of African American small business owners reported using cash raised through friends and family to fully or partially finance their businesses. Black owned businesses’ approval for credit is 19% less than the approval rate for white-owned businesses, according to the Federal Reserve Bank.

Covid has exacerbated the structural barriers that existed before. The Stanford Institute for Economic Policy Research released a study that showed from February to April 2020, the number of Latinx business owners fell by 32%, and African American business owners fell by 41%. White business owners fell by 17% during this same time period. 

The City can close the wealth gap by:

  • Working with the National Minority Supplier Development Council
  • Hosting seminars, town halls, and conferences focused on business owned by people from marginalized communities
  • Assisting with the certification process to become a Minority Business Enterprise (MBE), Disadvantaged Business Enterprise (DBE), and the Woman Business Enterprise (WBE) through the state.

SUPPORT ENTREPRENEURS

Small businesses are the heartbeat of Allentown. We must have multiple points of entry for entrepreneurs and have support set up for each stage of a business’ life cycle. Many businesses start in the home and eventually reach a point where they are ready to expand. We must provide support for entrepreneurs that find their business in a stage of growth by having community spaces available such as the commercial kitchen at the Caring Place. Foodservice startups are able to rent out the kitchen to prepare products and meet growing demand.

A significant number of entrepreneurs operate unofficially without a business license. Numerous neighborhoods have someone who is styling hair, doing nails, fixing cars, and selling clothes or empanadas. This demonstrates an entrepreneurial spirit that we should help provide direction and opportunities to enter the formal economy. The City must reach out to the community to demonstrate how getting a license, and other certifications will help them access capital and possibly scale up operations.

The City can assist entrepreneurs by:

  • Planning regular public markets in open spaces, including parks and parking lots.
  • Promoting smaller spaces with lower rents in new developments
  • Create an Entrepreneur District to promote mobile vending, food trucks, and pop-up temporary spaces for entrepreneurs to test ideas and products without investing in too much overhead.
  • Create a portal to link entrepreneurs to resources, capital and to guide them through the city permitting, zoning, and licensing requirements.
  • Starting new incubation centers for industries such as the culinary arts

SUPER SUMMERS

As we plan for COVID recovery, we must think forward to how we can bring life back into our city. Allentown has 2,100 acres of park land and is the largest park system per capita of any similarly sized city in the United States.  Our parks create opportunities for creative outdoor experiences. 

I plan to expand on the successful Super Sundays from the past by initiating a Super Summer festival for the community. This event will be a summer long outdoor festival offering free admission and activities, street performances, music, art, theatrical performances, local vendors, food trucks, and local retail vendors. It will be an opportunity for local business people, artists, and community leaders to connect, create and celebrate living in Allentown. 

CREATIVE ECONOMY

Allentown is a diverse city. We are a city with people from over 74 different countries speaking over 47 different languages. We are indeed an international city, and we must embrace and invest in our diversity through art and cultural organizations.

Investing in the arts will allow Allentown artists opportunities to showcase their talents across the city. We can promote dance, music, and other art opportunities through the development of art centers. Art centers can provide after-school programs, spaces to create and organize.

Colab Arts in New Brunswick, NJ, is a prime example of a community based arts center. This Center engages local artists and activists to feature poetry slams, Spanish language theatre, hip hop classes, and space for people to create and organize. Art is an economic driver and is one method of bringing vibrancy and social change to  Allentown.

We must promote art and creativity in our neighborhoods-in barbershops, bars, schools, playgrounds, corner stores and on the street corner. This means supporting and expanding on ideas such as the “50 Spots” initiative. In 2019, for four hours, tourists and residents were entertained by artists at designated spots in parks, at landmarks, businesses, and throughout downtown. The Alternative Gallery organized and hosted this event and would be a great resource for moving forward in the future.

CONCLUSION

The need for equitable development is urgent. Rents are rising, wages are stagnant and poverty continues to reap its vengeance on communities. These are structural issues that require a structural response. Working with developers, the community and organizations we can ensure that Allentown achieves economic justice.