A New Approach For How State Leaders Can Fight Concentrated Poverty

CREDIT: AP
CREDIT: AP

According to the American Community Survey, more than 12.4 million Americans live in severely distressed neighborhoods where the poverty rate is 40 percent or higher. Such high-poverty communities are characterized by poor housing, failing schools, inadequate public infrastructure, and few employment opportunities. A growing body of research shows that being raised in such communities undermines the long-term life chances of children, and negatively impacts adult employment and earnings. This is particularly troubling when considering the racial equity implications: 23.6 percent of low-income African Americans live in high-poverty neighborhoods, compared to 7.1 percent of low-income whites.

Fortunately, we increasingly understand what it takes to drive and support innovation in low-income urban, rural, and tribal communities.

Earlier this year, the Obama Administration announced the Promise Zones Initiative, an effort to revitalize high-poverty communities through comprehensive, evidence-based strategies while helping local leaders navigate federal funding opportunities. The Promise Zones model is about supporting the ongoing efforts of innovative localities as they work to attract private investment, create jobs, improve schools, and reduce crime, but there is no need for the model to be restricted to the federal level. States have a strong interest in targeting resources to high-poverty communities as the effects of concentrated poverty place a downward drag on state economies.

A new report from the Center for American Progress provides a framework for how state leaders can establish a Promise Zones program, modeled after the federal initiative, in order to support the innovative work communities are doing to address concentrated poverty. While this report talks about what states can do within the context of current funding, state Promise Zones are not a substitute for additional federal and state investments and reforms to help create jobs and strengthen the safety net more broadly.

CREDIT: Center for American Progress
CREDIT: Center for American Progress

Support Community-Driven Efforts

In the past, federal and state community development programs have prescribed a one-size-fits-all approach to using funding. The promise zones model, however, was designed to support communities committed to working across sectors to implement proven strategies. As a result, the funding is flexible and can adapt with changes in the work. A state Promise Zones initiative would require communities to compete in a transparent process and demonstrate the strength and effectiveness of their strategies for fighting poverty. Local leaders drive the effort, but outline for the state the outcomes they are pursuing for their community, their strategy for supporting those outcomes, and a plan for using data to track and drive progress.

Provide Priority Access To Resources

Because states undertake most direct spending on public goods and services — such as transportation, assistance to low-income families, and housing — state leaders are already equipped to establish their own promise zone initiative with existing resources. States oversee a significant amount of federal discretionary funding, giving state leaders broad authority in administering many competitive federal grants. For example, states set the guidelines for childcare subsidies and make decisions on how to allocate funding streams such as the Community Development Block Grant program (CDBG), School Improvement Grants (SIG), and the Edward Byrne Memorial Justice Assistance Grant (JAG). While CDBG and SIG have been staples in the community development field, leaders can rethink other federal funding opportunities, such as JAG, in the context of this whole-community approach. For instance, JAG can be used for crime prevention and education, rather than measures aimed at increasing incarceration.

Demonstrate innovative strategies to fighting poverty

The goal of a state Promise Zones initiative would not only be to transform the selected zones but also to change how the state government works with local communities, and to demonstrate effective strategies that other communities can adopt. In a world of limited resources, targeting funding to high-poverty communities means fewer resources will be directed to less disadvantaged communities that still face many of these challenges. However, targeting scarce resources to disadvantaged communities with the potential to move the needle on place-based interventions can have a larger impact beyond the borders of the zone. Furthermore, while many high-poverty communities could benefit from a state Promise Zones designation, the application process alone will incentivize communities to come together to set clear and shared goals, which is critical regardless of whether they are ultimately selected for the initiative.

By adopting this model, state leaders can complement the work of federal poverty programs and ensure resources are leveraged to be greater than the sum of their parts, boosting economic mobility and opportunity in ways that benefit families and states.

Update:

This post was updated to better reflect the content of the report.