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Buying In to SSAs

“This stuff doesn’t happen overnight,” said Cheryl Johnson … and she should know.

Auburn Gresham's 79th Street Special Service Area has helped leverage $2.5 million in neighborhood improvements since 2005.

Eric Young Smith

As an economic development consultant she helped organize the 79th Street Special Service Area, or SSA, and she’s stayed on to manage it from her office at the Greater Auburn-Gresham Development Corporation (GADC).

Since receiving LISC start-up funding in 2005, this South Side SSA, centered on 79th Street and running west from the Dan Ryan Expressway for 16 blocks past Ashland Avenue, has leveraged almost $2.5 million in improvements.

Sure there still are some “missing teeth” along 79th – the result of decades of disinvestment – but many of the stores now sport new awnings, signage, and window treatments thanks to special financing arranged through the SSA.

“Mind you,” Johnson cautioned, “it’s like pulling teeth sometimes. But once they (store owners) actually see the difference, like with our façade enhancement program, you get the buy-in.”

Pilsen pulls back

Getting that initial buy-in can be tough, however, witness the recent contretemps in the Mexican-American Pilsen neighborhood on the Near Southwest Side.

The Resurrection Project (TRP), LISC Chicago’s local partner there, has been leading an effort to lift 18th Street – already one of the more vibrant commercial strips in the city – to the next level. Until recently, plans centered on creating an SSA … but others felt that’s not the way to go.

Retail activity on 18th Street, in Pilsen, which does not have an SSA.

John McCarron

Unlike a local chamber of commerce, wherein membership and dues are voluntary, SSA districts are created by a municipal ordinance that empowers each to impose a small property tax levy. That levy can then fund a variety of improvements. These typically include regular sidewalk and street cleanup, installation of sidewalk “furniture” such as stylized trash receptacles and benches, decorative signage such as banners hung from light poles, and perhaps more importantly, technical assistance to help building owners apply for loans and grants to improve the look of their storefronts.

But a tax increase is a tax increase. By adding a levy of 50 cents for every $100 of a property’s assessed valuation, businesses along 18th Street would have experienced a tax increase approaching 10 percent. So more than a few store owners on or near 18th Street, joined by neighborhood residents fearful of gentrification, objected strongly this spring to creation of a Pilsen SSA.

"There are many things our community needs to make it better, but a new tax is not one of them," argued Vicky Lugo, a member of Pilsen Alliance, a social justice organization that views gentrification, not dis-investment or decay, as the neighborhood’s biggest challenge.

Ald. Danny Solis (25th) had been supportive of the SSA. But rather than put him on the spot by bringing a divisive intra-neighborhood fight to the City Council, backers of the application abruptly withdrew … with no plans to reinstate.

“We are committed to engaging with residents, business owners and stakeholders in the community to create a safer, more vibrant and healthier community,” according to a joint statement about the move issued by TRP and its affiliated Greater Pilsen Economic Development Association, which was to manage the SSA.

Fewer tools

No matter how the Pilsen disagreement is resolved, special service areas will continue to be one of the few economic development tools available in an era of declining state and federal aid to cities.

Altogether Chicago has established more than 40 SSAs, a program Mayor Rahm Emanuel has hailed as an important way “City Hall can be the partner, not the problem” for small businesses.

But getting an SSA up and running takes time … and an upfront investment, specifically to pay for the required feasibility study, needs assessment and legal groundwork that underpins the application to City Hall.

LISC Chicago Executive Director Susana Vasquez thinks SSAs can be useful economic development tools.

Gordon Walek

More affluent commercial districts can tap their chambers of commerce. Less affluent districts, like Auburn Gresham, can look to LISC Chicago, which since 2005 has fronted over $270,000 worth of project initiation loans (PILs) to help nine local business districts organize their SSAs.

Executive Director Susana Vasquez said these seed loans are proving to be some of the safest, most leverage-efficient outlays in LISC Chicago’s portfolio. A $50,000 loan made in 2007 to the Quad Communities Development Corporation, for instance, already has leveraged almost $1.5 million in SSA improvements in Bronzeville.

Vasquez points out that SSAs also double as a capacity-building opportunity for the sponsoring organization. “First, the group must demonstrate it has organized and secured the support of the property owners and the alderman. Once that’s accomplished, the SSA creates a funding mechanism that provides annual support to advance locally-driven economic development efforts. That leverages our investment significantly.”

79th Street reborn

“SSAs are extremely beneficial, particularly for low- and moderate-income communities,” seconded Cheryl Johnson, who helped organize several across the city before settling in to manage Auburn Gresham’s.

Johnson’s SSA team includes architecture and urban planning interns from the University of Illinois at Chicago. They work-up concepts for storeowners, getting them juiced to apply for deeply subsidized fix-up loans. Success breeds success, she said, and the brighter look along 79th has helped attract new stores like the CVS pharmacy around the corner on Ashland Avenue.

New wrinkles can be added as needed. Her SSA’s “litter-free zone” is being expanded this summer with help from an Urban Green Team of hard-to-employ local residents. And uniformed security officers, Johnson said, will be patrolling “hot spots” where teenagers “hangin’out” have made shoppers uneasy.

The SSA’s biggest single undertaking, though, is its 79th Street Renaissance Festival, co-sponsored by St. Sabina Church, which will celebrate its 8th year on Saturday, Sept. 7th. This annual Festival and Family Jam for Peace will draw some 10,000 to 79th and Racine, where they’ll find 100 vendors and exhibitors as well as continuous live stage acts. More than a one-day blow-out, Johnson said the Festival has made believers of several hard-to-convince store owners, drawing them into the SSA planning and implementation process.

“We’ve got a long way to go,” said Johnson of 79th Street. “But it’s like night and day compared to when we started.”

Carlos Nelson, executive director of the Greater Auburn-Gresham Development Corporation, thinks the 79th Street SSA has been instrumental in engaging business owners.

Gordon Walek

Running the SSA has also been a tonic for GADC, said Carlos Nelson, the group’s executive director. “It allows us to organize the business community. A number of businesses wouldn’t want to get involved but for the fact they’re paying into the SSA and want to see some return.”

Issues on 18th

Being able to visualize that return likely will prove key to the effort in Pilsen. By outward appearances 18th is one of the more vibrant commercial strips in the city, yet behind the bustle there are problems.

There aren’t enough curbside parking spaces along 18th, and, even if there were, shoppers there tend to avoid the new, privatized payment kiosks that accept credit cards and issue receipts. Behind many of those brightly-painted Spanish-language signs, moreover, are some of the oldest pre-Fire structures in the city. They may be nicely scaled and terra cotta decorated, but several are in need of tuck-pointing, thermal windows and even structural repair.

Several longtime store owners and managers don’t need to be convinced that 18th Street is ready for the next step.

“It would be a good idea if we could find some off-street parking,” said Eleazar Delgado, who for 19 years has owned the always-busy Café Jumping Bean at 18th and Bishop.

Same goes for Azalia Gomez, branch manager of MB Financial Bank, whose front-corner office affords a close-up of what’s happening on 18th.  “I’m hoping they do something about the viaducts,” she said, nodding toward the forbidding tunnels under the BNSF rail yard that motorists must brave when approaching from the north.

“You know,” she said, “we’ve got a lot of talented young painters and artists in this neighborhood. They could do a world of good by making those viaducts more welcoming. And how about a street festival? Or maybe a trolley?”

That level of investment may prove difficult without an SSA, though Ulises Zatarain, who leads the economic development effort at TRP, said other strategies will be explored.

“This has been a learning experience,” he said of the SSA pull-back. “But there are other ways we can work together.”

More information:
Learn more about LISC Chicago’s Commercial District work and contacts.
Ulises Zatarain, 312-666-1323  x243  uzatarain@resurrectionproject.org
Cheryl Johnson, 773-723-3557  Cheryl@cjohnsonassociates.com
 



Posted in Economic Development, Auburn Gresham, Pilsen

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Local Initiatives Support Corporation Chicago connects neighborhoods to the resources they need to become stronger and healthier.

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