Change to be slow in fight against blight

In the next few days, the Reno City Council is likely to approve a massive new redevelopment district in the city.

And what will happen next? Not a thing for a while.Maybe not for a long while.

Even though redevelopment districts represent a strategy to bring new investment into blighted neighborhoods, the work of Reno's Redevelopment Agency involves the slow change of public perceptions as much as it involves the flow of capital.

The downtown redevelopment district that's seen a flurry of recent private investment, for instance,was created some 23 years ago and not much happened for more than 20 of those years.

The City Council this week will vote whether to create a sprawling redevelopment agency that include properties ranging from weed-filled cropland just north of Boomtown to a redeveloping former Kmart store at Peckham and Kietzke lanes.

In all, about 1,100 acres are involved.All of them are blighted a technical term that covers physical deterioration, crime and social problems, lack of investment and a host of other conditions.

Reversing those trends will require hefty amounts of private investment, says Frederick Steinmann, the Redevelopment Agency employee who spent 10 hours a day, seven days a week for two months methodically examining every property, every alley, every street in the proposed district.

But before private investors are willing to take a chance on a blighted neighborhood, they need to regain confidence that neighboring properties won't drag down the value of their investment, says Kristin Danielson, economic development manager for the Redevelopment Agency.

"We want to transform how people are thinking of an area," Danielson says.

That means, she says, that the agency looks to spend its money and its energies on a handful of strategic projects, the sort of work that can change the momentum of a neighborhood.

But in a chicken-and-egg conundrum, the Redevelopment Agency needs to see some private- sector improvements before it can do much on its own.

The agency's money comes from the increase in property taxes within a redevelopment district, and tax collections rise as properties are improved.

But until the agency has the money to make public investments, private improvement projects may be slow.

One way around that problem is borrowing, and the city's staff believes that lenders will look more favorably on a redevelopment project that stretches across several neighborhoods.

That provides diversification and reduces risk.

The uses of the money can range from assembly of land packages that can be sold to developers to improvements in infrastructure such as streets.

"I am a believer in markets," says Steinmann, who was trained as an economist.

"But in the case of these areas, the market has failed."

Half the properties in the proposed new district didn't increase in value from 1997 to 2004 even as properties elsewhere in the cities rose by an average of 9 percent.

Lease rates in the proposed district run 36 percent below averages elsewhere in Reno.

More than two-thirds of the buildings have exceeded their useful lives without significant renovation.More than a third of the property within the district is either vacant or underutilized.

And in a statistic that gnaws at Steinmann, an estimated 15 percent of the households live in overcrowded conditions converted garages along hidden alleys, former single-family homes broken into three or four rental units, rooms in weekly-rental motels.

On the other hand, redevelopment agency executives don't want to squeeze low-income families out of the only housing that many of them can afford.

The new redevelopment district would carry a requirement that at least 18 percent of the housing that's created must be affordable.

But gentrification and affordable housing, Danielson says, aren't likely to be issues for a while.

For the next several years, the challenge will be finding something anything that begins to reverse the trend of the neighborhoods.

"In the end, it is a challenge to get the first one going," she says."And it takes years."