Obama's 'Promise Zones' Have Potential if They Include Anchor Institutions

Efforts to promote economic development must shift to the local level, but they can't overlook some of the biggest players in these communities.

At a press conference yesterday, President Obama told the story of his time organizing in Chicago and highlighted the work local communities do to support their neighbors and prepare them to be contributors to the economy. This renewed emphasis on the importance of localities accompanied the President’s announcement of five “Promise Zones,” specially designated communities that will receive increased federal resources and coordinating support in their efforts to develop economically. This announcement comes as welcome news to advocates for equal economy opportunity in the United States, but the approach seems to be constrained by an overly narrow definition of community stakeholders.

According to the White House, the Promise Zones, which will be established in Los Angeles, San Antonio, Philadelphia, southeastern Kentucky, and the Choctaw Nation of Oklahoma, will focus on replacing distressed housing, reducing crime rates, increasing student high school graduation prospects, and stimulating economic growth via tax incentives. As I’ve written before, the ineffectiveness of the modern United States Congress has made federal legislation to address rising inequality a pipe dream. Thus, the local level is the new battleground for tackling pressing economic challenges such as these.

However, questions still remain as to whether these new Promise Zones take the best possible approach to generating sustainable economic development. At this point, information provided by the Department of Housing and Urban Development and the White House focuses primarily on the usual community stakeholders: businesses, K-12 programs, the local government, etc. Given the financial constraints many localities and school districts are facing and the natural limitations of tax incentives, it would behoove the administration to widen the scope of the policies they implement in pursuit of growth.

Anchor institutions, such as universities and hospitals, are an untapped source of job growth, financial investments, intellectual capital, and community support. Hospitals and universities spend over $1 trillion a year and employ 8 percent of the total U.S. labor force. My colleague Alan Smith recently wrote about the work that the Roosevelt Institute is doing to analyze the local impact of these anchor institutions through its new Rethinking Communities initiative.

Identifying and engaging with anchor institutions would not be difficult. For example, local governments could recommend the allocation of federal grants to universities and hospitals that make targeted hiring efforts in particularly distressed portions of the Promise Zone communities.

Shifting responsibility for economic development away from the dysfunctional legislative branch and toward our local communities will require us to think more broadly about what community means and what kinds of actors shape it. With this challenge in mind, Promise Zones would benefit greatly from the incorporation of anchor institutions in their strategies for promoting long-term growth and economic opportunity.

Joelle Gamble is the Roosevelt Institute | Campus Network's National Field Strategist.