Unlike other industrial towns that have re-invigorated themselves (Pittsburgh, Jersey City and even Newark) Trenton has been left behind. Trenton’s Mayor Palmer is a nice guy and seems to mean well but just hasn’t been able to steer the city towards any meaningful revitalization. For the past 17 years during the Palmer administration, we’ve been treated like a welfare state chasing every government handout available and with predictable results. We’ve chased away high income residents and attracted poverty.

The facts speak for themselves.
According to the U.S. Census Bureau, from 1999 to 2006 New Jersey’s per capita income has risen 18% while Newark’s has risen 24% and Jersey City a whopping 29%. Meanwhile, Trenton has lost ground with a meager 9% gain in the same seven years moving from $14,621 to $15,933. In 2006, while Trenton was busy electing the mayor that delivered these sad results, the city’s per capita income actually shrunk by 0.4% while New Jersey, as a state, grew 1.3%, Newark gained a respectable 4.8% and Jersey City grew an astounding 14.6% and

Given Trenton’s abysmal record it’s clear that the current administration either doesn’t really want to fix the problem or just doesn’t know how. Furthermore, it pains Trentonians to see the US Conference of Mayors being led to believe that Trenton is a model of economic revitalization. It clearly is not!

As a long time Trenton activist, real estate investor and student of urban economic issues I’m offering this paper as an alternative approach to Trenton’s revitalization.

First the question: What’s really wrong with Trenton?
When Trenton’s industries changed, its politicians and citizens were unable to change with them and eventually business moved away.

At any point during the last 80 years of decline, a visionary politician could have stopped the backslide by simply getting back to basics and investing in the higher education necessary to maintain a relevant workforce, but it never happened. Trenton’s growing dependence on government jobs masked the problem but could never compensate for the loss of a real commercial economic base.

Lack of business opportunity in Trenton created social tension which eventually led to severe social unrest which in turn made the city an undesirable place to live. As the last remaining financial capital moved out of the city, any hope for economic revival moved with it. This cycle of economic and social decline has been left un-mended for over eighty years.

As a result, our population is no longer economically diverse. Our per capita income is half that of New Jersey’s and the average education level for the city is only 8th grade. Statewide, around 30% of households have incomes of over $100,000. In Trenton the number is only 8%. And while 6.6% of New Jersey households have incomes of over $200,000 only a 0.1% of Trenton households fall into that category.

With so few wealthy neighbors, we shouldn’t be surprised that taxes on the middle class are so high. Our property taxes are over $4 per $100 in assessed value are among the highest in New Jersey and the nation. We’ve chased all the rich people away leaving low income people holding the bag. With such a high tax rate it’s now hard to attract new development to the city.

So why is this a problem? Some Trentonians might secretly not like rich people but it turns out that highly educated people with significant access to capital are more likely to create new businesses than the poor. Without local sources of capital, not only aren’t businesses formed in a city, but real estate development (including home improvement) doesn’t happen nor does investment in the city’s cultural institutions.

Also, high income people tend to spend a lot more at retail. Trenton’s per capita retail sales are approximately half of the average for New Jersey. This makes Trenton a poor choice for new retailers. Without retailers, Trenton is a less attractive place to live.

Weak retail, bad job prospects, low culture, high taxes, high crime and meager city services consistent with a strained budget combine to make Trenton a poor choice for potential new residents that can afford to live in places like Princeton, Lambertville and Hamilton.

It’s a viscous cycle.

Breaking the Cycle

The current administration’s strategy of developing subsidized housing and pursuing large scale developments can best be described as inept. The results speak for themselves as evidenced through the lack of income and population growth.

For the past 17 years, Trenton has worked to build subsidized housing in Trenton and with some success. Entire neighborhoods like Old Trenton have been permanently turned into ghettos by concentrating low income housing in that area.

At the same time the administration has pursued large scale projects without success. Large residential developments are quite a gamble in a city with few attractions and high crime. As a result, these deals ultimately require large subsidies or massive use of eminent domain and therefore become unworkable.

City attempts to recruit business have been generally unsuccessful as evidenced by its lack of private employment. From time to time businesses do consider moving to Trenton but our residents are unskilled, the streets are unsafe and there’s no local market for the business’ output. None of these issues are being addressed.

Breaking the cycle will require a clear strategic vision that Trenton does not yet have.

A Vision with Direction

Trenton needs a plan that will lead to a visionary goal; Trenton should be a self-sufficient economic growth engine for 21st century industries.

We can do this by attracting the creative class and high income people to Trenton in large numbers. The creative class is made up of business people, artists and scholars who are looking for an urban canvas on which to build their life’s work.

This central tactic will have three important results: 1) Our streets will be safer by virtue of an influx of civically involved eyes on the street, 2) Our economy and tax base will be immediately boosted by new residents with disposable income which will allow us to move off of the state’s charity list, 3) The creative class will create new businesses and with just a little help may form vertically integrated hot beds of one or more 21st century industries.

To sum it up, my revitalization plan is to make Trenton attractive to the creative class and high income individuals. This is hardly a new strategy amongst urban revitalization strategist, yet Trenton has steadfastly refused to try. In fact, the city’s latest residential project, The Broad St. Bank has an income cap of $136,000. A doctor, investment banker or management consultant would be barred from living there. If a couple tried to qualify then we’d have to exclude university professors, corporate managers and even state government department heads. This is astoundingly bad policy.

Instead, we must make Trenton attractive to highly educated and high income people. Trenton needs to be a better living option than Hamilton, Lambertville or Bucks County.

So what can we do to change Trenton’s fortunes? What would a progressive administration and city council do?

Make Trenton Attractive to our Target Market
This isn’t as daunting as it might seem. First, we must realize that attracting families with school aged children will be nearly impossible unless the families are wealthy enough to pay for private schools. Second, those new neighbors will be working elsewhere (New York, Philadelphia or Rt. 1) and we should be happy with that for now.

Once we know that our target market consists of creative young professionals, empty nesters, high income families and gay folks, it becomes a bit clearer what we need to do.

These target markets all value arts and culture, attractive high end homes and pleasant surroundings. They’re less worried about crime, but their patience goes only so far.

Here are the five solid steps Trenton can take, and could have taken at any point in the last 17 years of Mayor Palmer’s administration.

Step 1- Facilitate high end real estate development.
A city government’s role in stimulating development is to create a climate conducive for it. We can do this by punishing those speculator who hold on to vacant properties for years at a time while at the same time making it easier to develop property in the city.

Trenton’s current population is 86,000, down from a high of 140,000. We have plenty of land and vacant property. If even half of this property could be turned into upscale housing, Trenton would be able to easily attract thousands of new residents. As it stands now, a person wanting to buy a $500,000 loft or a $1,000,000 house in Trenton couldn’t. There is barely any housing stock even at the $200,000 level that would attract the young creative professional that Trenton needs.

Three policy changes are needed to turn this around and open the floodgates of real estate development.

First, Trenton must institute heavy fines on property owners who allow their holdings to remain vacant and untended for over one year. These fines will weed out the speculators who hold onto property in the hope that others will improve the city for them. These speculators are a scourge on the city and must be dealt with harshly.

Second, the city must streamline its process for acquiring and then selling property. Currently Trenton attempts to maximize the sales price of its real estate and each sale must be approved by city council. Instead of this clumsy process, the city should deed all of its properties to a land trust that would be tasked with disposing of the land at market rates. The land trust would enlist and pay for the service of realtors who would market property through normal channels. Real Estate sales would move from the murky world of sealed bids to the open world of Realtor.com.

We shouldn’t be afraid to sell distressed properties for nominal prices. The unfortunate truth is that much of Trenton’s real estate is worth either nothing or has a negative value (true if no economically feasible development could occur on the land).

Finally, the city’s inspections and developer assistance program must change from being reactive at best, to being an aggressive partner. Trenton’s current practice of notifying builders of permit approval by snail mail within 22 business days would be laughable if it weren’t so sad. Given that a simple plan approval can actually be done in around 4 hours, a better approach would be for city inspectors to schedule appointments with builders and architects to review and modify plans on the spot.

A good developer assistance program would ensure that parking and “aid” issues are addressed promptly and aggressively instead of today’s haphazard process. For instance, rather than have the Broad Street Bank’s developer wait two years to get help with his parking issue, work would start the day after the first meeting with the city and would be part of the project plan.

Trenton inspections and economic development staff must be put in a “lean forward” stance that asks “how can I help you get it done?” rather than a “lean backwards” position that says, “Let me tell you what you can’t do”.

Trenton’s development community lives in fear of speaking out on these issues lest they fall into disfavor with a vengeful city administration. However, in private, they are not silent at all and believe Trenton to be a difficult place to do business. This must change.

We’re not so good that we can afford to be difficult.

Step 2 – Support the arts and culture
Study after study makes the point that the arts and culture are extremely good investments for city governments. It is no surprise that Trenton’s current leadership doesn’t buy into the argument as they are rarely spotted at the city’s cultural events.

Nonetheless it is true. The arts have a powerful economic multiplier effect. According to American for the Arts’ Arts & Economic Prosperity: the Economic Impact of Nonprofit Arts Organization Audiences, $100,000 of spending by a non-profit arts organization generates 3.36 jobs and $2,841 in tax revenue for a city the size of Trenton. Additionally, event-related expenditures for meals, souvenirs etc. average $22.10 per person.

The creative class values arts options like museums, theaters and film festivals. Whether they use them or not, they like having such diversions around and equate culture, with urban living.

A proper economic development plan would seek to create a fund matching scheme for arts and cultural organizations that rewards those organizations that manage to attract audiences and donors.

Step 3 – Clean up the joint
Trenton is a pig sty! Our streets are filled with litter strewn about by citizens with no respect for their city, neighbors and apparently themselves. However, it’s not quite fair to place all the blame on average Trentonians.

The city provides insufficient numbers of trash cans and empties them too infrequently. In fact, it is common to observe overflowing trash cans on South Broad St. Trenton’s main commercial venue.

As a policy, street trash and litter removal must be given similar priority to economic development and crime prevention. There is no magic here, Trenton must spend money on public service messages, increase trash receptacle and make them more inviting and empty the trash cans it does have. If the public works director can’t get it done, then we need a new director.

Step 4 – Squash the gangs
It’s time to get tough on crime.

First, we must invite state and federal law enforcement into Trenton. There is no room for pride when it comes to public safety. If our Police Director is in the way of coalescing this kind of full court press, then perhaps we need another Police Director. If the unions balk then the public should turn against them until their leaders leave or they become enthusiastic.

Second, facilitate development of strong civic associations. There is a direct correlation between civic association strength and crime rates in Trenton. Too many times, the city administration is at odds with the neighborhoods and the Trenton Council of Civic Associations. This can’t continue.

Finally, in addition to increasing police presence and supporting neighborhoods, Trenton should institute “no tolerance” policies that chase criminals off the streets and provide police with more contact. No tolerance includes finding and dealing with truant students who grow closer and closer to a life of crime everyday they miss school.

Step 5 – Create a reason for Trenton to be here
Other than state government, there is no reason for Trenton to exist. To be the economic growth engine for 21st century industry we need to help new industries coalesce in the capital city. This will take careful thought by smart business people who have Trenton’s long term success in mind. We’ll need to include outsiders and academics in our thinking. This paper won’t attempt to pre-judge the city’s choice however, we should establish an advisory board to guide our way forward.

In summary we need to make it easier to build high end residential real estate, make Trenton more attractive to visit and live in and follow all this up with a vision for a 21st century industrial base. We should aim to increase our per capita income to neighboring Hamilton’s level (a little less than New Jersey’s average) within the next five years. If we get all of this done we might just make this goal and give our children a bright future to boot.

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