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Chapter Summary

Frug, Gerald E. and David Barron. 2008. City Bound: How States Stifle Urban Innovation. Ithaca, NY: Cornell Univ Press. (Chapter 9)

Beyond the global and tourist genre of city lies a more commonplace version: the middle class city. Set against the immense suburban migration of the past half-century, Frug and Barron outline four potential ingredients to bolster the citys strength in protecting and defending the middle class: taxation, education, affordable housing, and the local economy. They argue, moreover, that middle class cities need comprehensive economic development strategies in order to effectively compete with global and tourist cities.

Taxation policy, particularly the property tax, is one of a handful of tools that cities have to fund services for the middle class, though it is constrained by state law. In particular, our authors argue that a progressive form of property tax whereby higher-value properties are taxed at a higher rate would reduce resident inequality, but is generally prohibited by state law. However, some cities circumvent these restrictions by creating exemptions for particular demographic groups, such as the elderly. Likewise, sales and income taxes are two other means for raising revenues, but both are subject to state law restrictions.

City control of education policy revolves around two central topics: mayoral control and charter schools. Frug and Barron contend that a mayoral control of the school system is likely to create better education policy, but is likely to be challenged by the state, as was the case in California. Charter schools also represent a clear illustration of how states can limit the ability of a city to decide the best way to improve the school district, as many states hold the ultimate approval authority for charter schools and place restrictions on their number.

In regards to affordable housing, cities have few options shape housing policy from the supply-side, while the demand-side is dictated by market dynamics. Tax breaks, infrastructure improvements, and zoning variances are a few examples of ways to entice private developers to build affordable units. Inclusionary zoning is also a device that cities use, but usually these requirements often exclude middle-class families. In sum, state legislation greatly constrains what cities can legally demand from private developers and how they can regulate them.

Finally, Frug and Barron argue that economic development may be best promoted on a local level. Ordinances that promote a living wage, increase municipal employment, and promote small business development are city-sponsored initiatives that can help the middle class. Ultimately there is substantial uncertainty about the extent to which states will allow these types of ordinances to exist without regulation. Our authors assert that holding the status quo will encourage the further breakdown of the urban middle class and continue to increase the spatial and income inequality.