Once known as 'slum clearance,' the policy tool is now used for economic development

This is the first in an ongoing series of articles investigating urban renewal. In this piece, we investigate its history and look at districts in Clackamas County.

Oregon City sparked both optimism and controversy with its recent move to vastly increase the debt ceiling in its urban renewal district.

While the move has dominated local discussion, Oregon City is among thousands of governments nationwide to hang the hopes of its town on the policy tool. Its story is not uncommon: a former industrial town that went through economic struggles and population declines before a resurgence. As people again find these former industrial cities desirable places to live, local officials are looking for ways to avoid becoming bedroom communities without a strong economic core.

Urban renewal districts allow governments to designate an area as blighted and freeze tax values in the district while collecting the increased assessment to pay for improvements. The districts have become an increasingly popular way to try to breath economic life into these communities.

Historical perspective

While urban renewal is now used primarily as an economic driver, that's not how the concept originated decades ago. Urban renewal started in major cities like Detroit and Philadelphia in the 1940s as a way to provide more housing for a booming population.

History has not been kind to urban renewal in its original form, which became known as 'slum clearance.' According to a 2002 report published for the Portland Development Commission called 'Urban Renewal in Oregon: History, Case Studies, Policy Issues and Latest Developments,' early projects in Oregon were driven by federal funding and generated controversy. Projects like Portland's South Auditorium was indicative of urban renewal projects at the time, which razed buildings, and displaced residents and existing businesses.

'Originally urban renewal basically just went in and bulldozed large areas of cities,' said Anthony Rufolo, a professor of Urban Studies and Planning at Portland State University. He said that local governments were trying to attract high-income residents that were moving to the outskirts of big cities. 'If you look at [early] urban renewal, it didn't work. The renewed areas were higher income but the overall … the net gain was very little.'

Urban renewal was often seen as discriminating against different ethnic groups in poor or working class neighborhoods and it's often accused of destroying neighborhoods in cities.

The slum clearance method of urban renewal changed in the 1970s when Congress passed the Housing and Community Development Act. Rather than giving grants directly to urban renewal districts, the federal government began to give undedicated grants to local governments. Around the same time, urban renewal agencies began to shift their focus from renewing residential neighborhoods to instead reviving business districts.

These moves increased the role of tax increment financing, and bonds paid for the TIF money were not subject to voter approval, a provision in Oregon urban renewal policy that remains today.

Local urban renewal projects

Along with Oregon City's urban renewal district, Clackamas County runs four districts, three in the North Clackamas area. In addition to the Government Camp Village District on the flanks of Mount Hood, there is the Clackamas Town Center Area, which was formed in 1980 and currently encompasses 819 acres of unincorporated land between Milwaukie and Happy Valley, and includes Clackamas Town Center.

The North Clackamas Revitalization District is a 1,000-acre area to the north of the Town Center district. Formed in 2006, the district borders Portland and is plagued by crime and economic challenges.

The Clackamas Industrial Area is a long corridor that stretches from the Harmony Road area west of SE 82nd Avenue and continues east, encompassing most of the industrial area on the north side of Highway 212. The district was originally established in 1984 with almost 2,200 acres, and was amended in 2001. It now includes 1,187 acres. The county has ended the TIF in the district's boundaries, and will likely close it soon, once a few remaining projects are included. The Clackamas County Development Agency estimates that assessed values in the district were $300 million when it opened in 1984. When two separate pieces of the district closed; one in 2001 and one in 2006; they were worth a combined $577 million.

County Commissioner Bill Kennemer called the district a 'model of success' in bringing 'jobs, congestion relief and improved livability' to the area.

Next week we'll talk to regional planning experts about the economic and planning challenges and realities of urban renewal. In the future we'll look at prior urban renewal districts in Oregon City, along with other districts across the state.

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