Perhaps not since the urban upheavals of the 1960s have American cities and those who care about them faced so many challenges. The combination of a recession,
an unprecedented decline in home values, and an increase in foreclosure and abandonment has led to serious budgetary pressure on cities and the county, state, and
federal governments on which they increasingly rely for assistance. Budget reductions and employee layoffs have mounted.
Fully 88 percent of city finance officers have told the National League of Cities that they fear they will be "less able to meet fiscal needs in 2009 than in the previous
year." Virtually all of the twenty largest U.S. cities are facing looming budget deficits—including (as of August 2009) Jacksonville
($170 million), Chicago ($520 million), and Philadelphia (projected five-year deficit of $1.4 billion). Just as significantly, revenue from property tax, income tax, and
intergovernmental aid is declining more rapidly than spending is being cut, meaning that the pressure on city budgets will only grow in coming years.
At the same time, more and more citizens are looking to government for assistance, and taxpayers are more carefully scrutinizing the value of the public services that
they receive in exchange for their tax dollars. Budget cutting is already widespread: fire services in Los Angeles, police services in Memphis, and parks and recreation
services in Baltimore. More cuts may be necessary—and justified—but will likely stoke voter discontent.
It is trite—but still true—to say that in crisis, there is opportunity. Budgetary pressure can, in a phrase favored by Stephen Goldsmith, former mayor of Indianapolis,
make city services "better, faster, cheaper." Indeed, improving on those counts can help citizens get more for their tax dollars as well as lay the foundation for a
healthy city economy.
The Manhattan Institute, through programs such as Cities On A Hill, has long taken a special interest in cities and their citizens. As the historical locus of
economic innovation, cultural dynamism, and democratic discourse, cities are the human ecosystem par excellence. Thriving cities are key to thriving regions and societies.
Cities do not thrive, however, solely as a result of broad historical forces and trends. Policy decisions and management approaches at all levels of government
matter greatly. The "urban renewal" policy of the 1950s and 1960s, which leveled some historic neighborhoods and routed highways through others, proved devastating
to dozens of American cities, large and small. Conversely, the "broken windows" approach to urban policing, as well as the computer-based crime-measurement system
known as CompStat, has led to dramatic reductions in crime rates in New York and elsewhere since the early 1990s.
Even small changes can make a big difference. Internet and telephone-based portals such as New York's 311 system and Louisville's CityCall that allow citizens to
access information, file complaints, and receive responses have changed the way that city residents relate to municipal government and have helped incentivize provision
of high-quality public services. "Pay-per-bag" garbage disposal, once little known outside Seattle, has spread nationwide, enabling jurisdictions to reduce
garbage-disposal costs and increase participation in recycling programs.
No one can be sure that new initiatives will succeed; nor can there be guarantees that innovations that work well in one jurisdiction will work as well in others. But
the Manhattan Institute believes that it is worth researching, developing, and highlighting policy approaches that have delivered results or shown promise. We are proud
to be closely associated with CompStat and broken-windows policing, thanks to our close working relationship with former New York mayor Rudolph Giuliani and former city
police commissioner William Bratton—whose successors have effectively continued and refined the policies. The Manhattan Institute also helped lay the intellectual
groundwork for the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (also known as the Welfare Reform Act), whose emphasis on work, coupled with
a lifetime limit on cash assistance, had a powerful impact on the lives of city residents and their neighborhoods. We continue to believe that spreading the word about
ideas that have worked, and new ideas that hold promise, is part of our mission.
This spirit informs the work of our Center for State and Local Leadership and its long-standing Cities on a Hill project. Our goal is to help develop and advance an
effective urban agenda.
Fiscal Conditions in 2009," September 2009.