Money Pit, cont.

Burl Gilyard
City Pages - Cover Story - Vol 21, Issue 1016

May 24, 2000

Today Miller doesn't have to tutor anybody on the basics. The NRP has become a system unto itself, and many of the participants have learned the game--only too well, in the view of skeptics who suggest that Miller has turned the program into a kind of shadow government.

"He's the best bureaucrat I ever met," says Joe Barisonzi, who once headed the Lyndale Neighborhood Association and now serves as CEO of an online venture called CommunityLeader.com. "And early on NRP needed a bureaucrat. Now it needs leadership.

"My biggest critique of Bob," adds Barisonzi, "is that, in classic bureaucratic form, he has tried to position himself as the arbiter between city hall and the neighborhoods. To city hall he wants to represent the neighborhoods, and to the neighborhoods he wants to represent city hall."


Like so many municipal projects, the NRP began with a task force, which begat--what else?--an advisory committee. In 1987 then-Mayor Don Fraser and the city council put together an ad hoc group to find ways to funnel more development money into the neighborhoods. Part of the stated motivation was the previous year's overhauling of the federal tax code, which had caused private investment in rental housing to dry up. The initial recommendation of the Neighborhood Housing and Economic Development Task Force called for some $84 million a year in spending, with the primary emphasis on housing.

By the time the city council and the state Legislature passed a law to establish the NRP, the $84 million-a-year proposal had morphed into a $20 million-a-year plan slated to last 20 years; policymakers sometimes compared it to the city's 20-year street-paving project. The state law allowed Minneapolis to undertake a complicated pooling and refinancing scheme involving several big downtown projects to fund the program.

The goals outlined in the statute were broad, and arguably impossible to measure: "The activities of [the] program must preserve and enhance within the neighborhoods private and public physical infrastructure, public health and safety, economic vitality, the sense of community, and social benefits." The law called for nine different types of projects the money could be spent on, but the emphasis was clearly on housing: The measure required that 52.5 percent of the program money be spent on "housing programs and related purposes." Though the law does not mention affordable housing, city officials now insist that it should be a priority.

Despite the vagueness of the law, the NRP has certainly fallen short of the mark. According to the most recent city statistics, the "action plans" outlining how each neighborhood wants to spend the money allotted to it have earmarked 49 percent of the NRP's total expenditures for housing programs. Factor in administrative costs and that number drops to about 46 percent. City number crunchers don't have hard-and-fast figures about how much money has gone to affordable-housing programs, but it's clear that far more money has gone into home-improvement loans or grants than for, say, rental housing. The NRP has also funded a bevy of smaller projects ranging from ornamental street lighting to improvements in city parks and schools. (See "Where Has All the Money Gone?")

Some have argued that given the way the program was set up, an emphasis on homeowner-friendly projects was inevitable. A 1994 study by Ed Goetz and Mara Sidney of the University of Minnesota's Center for Urban and Regional Affairs concluded that the NRP "exacerbates the bias in citizen participation toward middle class, white, property owner participation....The organizations that emerge from the NRP process are likely to be dominated by homeowners and land entrepreneurs--even in neighborhoods that are overwhelmingly renter and significantly low-income."

Former city council member Tony Scallon says the NRP has abandoned its original vision


For some neighborhoods the strain of balancing competing interests--and of managing the sudden influx of NRP dollars--proved too much. In 1992 the Whittier Alliance almost collapsed after a contentious board election pitted homeowners against advocates of low-income housing. Six years later the People of Phillips organization was dissolved after several audits found widespread financial mismanagement.

Miller acknowledges that handing control to neighborhoods has not always produced spectacular results. But on balance, he maintains, grassroots groups have shown themselves better able to manage a buck than the average politician.

"I've had very few projects that haven't had cost overruns when they've been done by an agency," he notes. "But you know what? I haven't had a single neighborhood--not one--come to me and ask for more money than was in their plan allocation. Not a single neighborhood has come in here and asked for more money than they were originally approved for."

"When they get a contract for $20,000," says Miller with a touch of amazement, "they treat it like it's a contract for $10 million. They work within the level of resources that they already have. That's a level of discipline that the city and other agencies could benefit from."


Of course, compared with the city's big development deals, the NRP doesn't have all that much money to spend. The budget for the expansion now under way at the Minneapolis Convention Center, for instance, stands at $207.7 million, almost as much as the NRP allocated citywide in its first decade. And the recently approved Block E complex includes $39.1 million in public money--enough to fund two entire years of NRP operations and programs.

Some have argued that the comparatively limited funding set the program up to fail--or at least to be perceived to have failed. While the NRP had been sold as "a panacea for urban problems," noted a 1995 study by the Center for Urban Policy Research at Rutgers University, truly making a difference would require "more than handing out a relatively meager amount of money to the neighborhoods."

Still, some of the program's founders say they're disappointed with how the program has turned out. Tony Scallon, one of the primary architects of the NRP during his tenure on the city council in the Eighties, says he envisioned the endeavor as a way to fund substantial affordable-housing projects. "I didn't know the program stood for neighborhoods rehabbing their parks," says Scallon. "That isn't the program I voted for. It's positive in the sense that middle-class people get their parks; what's negative is that we have a housing crisis."

At the moment, no one seems to know for sure whether the NRP could be punished for missing numbers outlined in the state statute. With characteristic understatement, Miller says that "it is unclear whether there is a penalty for not complying."

Ann Berget, a former member of the Minneapolis Board of Education who spent seven years on the NRP Policy Board, says the recent discussion of affordable housing reminds her of a 1995 plan pushed by Cherryhomes that would have taken $5 million a year from the NRP and directed the money to economic development projects to be overseen by the Minneapolis Community Development Agency (MCDA). Than plan died, Berget recalls, when the city realized that such a change would require the consent of all five participating jurisdictions. "I think the whole experience kind of chastened everyone," she concludes.

Berget further argues that those who criticize the NRP for not meeting its original goals are forgetting the program's history. "NRP was not designed to address citywide priorities," says Berget. "Some people now assess the program as if there was a blueprint for this whole community-building effort. There wasn't a blueprint; there was the practical equivalent of a sketch on the back of a napkin."

Moir, the city finance officer, contends that anyone who hoped that the NRP would solve the city's low-income-housing crisis was dreaming. "When you talk about the billions of dollars--I'm talking billions--we need to invest in our housing stock, NRP isn't going to make a big impact there," says Moir. "I think [the program's effect] is more psychological. If a neighborhood looks sharper and cleaner and brighter, that goes a long way towards making people feel better about the neighborhood and wanting to invest in the neighborhood."

Scallon, however, isn't satisfied. When the city set up the program, he argues, it laid down some pretty clear goals. But in the decade since, someone managed to insulate the neighborhoods from any pressure to comply. And Scallon has a pretty good idea who that was: "Bob's a great manager," he offers, "but he needs to learn to be able to set standards for the folks who are going to be getting the money. The problem came when no standards were applied."


Scallon is not the only current or former city hall insider who has come to regard Miller with some suspicion. Some politicians now regard the NRP director's casual demeanor as a front that masks canny strategic acumen. Miller, they mutter, has an infuriatingly effective way of politely nodding his head when the politicians talk--and then going out and doing whatever he feels like.

On February 17, city council members were seated in one of the conference rooms on city hall's third floor for their biweekly caucus meeting--an informal bull session where Minneapolis's elected representatives review issues and kibitz. Council member Lisa Goodman asked Jackie Cherryhomes whether she'd heard of some meetings scheduled in various neighborhoods for the purpose of discussing plans for Phase II. Not really, Cherryhomes replied testily: All she knew was that a few days earlier she'd gone to what she considered the official meeting on the topic at Whittier Park. Someone had handed her a flyer announcing a whole different set of get-togethers--orchestrated, of course, by Miller.

The NRP Policy Board, said Cherryhomes--who at the time served as that body's chair--had not been made aware of the gatherings. "What else is new?" she concluded, rolling her eyes. Goodman suggested that an official "letter of concern" be drafted for Miller's personnel file. It was suggested that council staffer Kent Robbins be directed to handle the matter.

But no letter ever materialized. "We opted not to do that," Cherryhomes says now, "because [Miller] works for the policy board and not the city council. I wasn't happy [but] I talked to Bob about it, and we worked it out."

Miller insists that he had no intention of blind-siding the politicians. He told the policy board that there were going to be neighborhood meetings to discuss Phase II, he contends: He didn't say when, where, and how because "I didn't know."

But it's no secret that Miller doesn't always agree with his bosses' approach to citizen participation. "The [city's] idea of having one community-wide meeting is bullshit," he says. "C'mon, that's a show." As if remembering the politics of his job, he hastens to add, "I support those kind of meetings, yes." Then he continues: "The difference between providing information and obtaining information is pretty significant."


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