The Paradox of Progress Underscores Atlanta Mayor’s Race

Things are looking up right now in the city. Well, at least part of it. That inequality will impact the city’s upcoming election and be the biggest issue facing its next leader.
by | October 2017

Fifteen years ago, about the only thing you could buy along Spring Street in Midtown Atlanta was drugs, or maybe the services of a prostitute. One of the few functioning retail outlets was a coffee shop known as Erehwon. That was “Nowhere” spelled backward, and to many who passed by, it was an apt symbol for the neighborhood. But today, the formerly sketchy street boasts all the amenities you’d expect to find near almost any college campus -- a smoothie bar, a couple of late-night cookie bakeries and a bookstore that also sells sweatshirts and souvenirs.

The change has been dramatic, but its origins are simple. Georgia Tech, which was separated from the neighborhood and the rest of the city by an interstate highway, decided it was time to jump that road, expand eastward and fill up some of the vacant lots in Midtown, initially with a hotel and conference center. Twelve percent of Georgia Tech’s huge off-campus student population now lives on the east side of the freeway.

The university’s investments, in turn, triggered one of the most remarkable urban revitalization efforts in the country. Traffic today can sometimes grind to a halt simultaneously on several blocks along Spring Street, the result of one massive construction project after another. Georgia Tech students study and live among 17 corporate innovation centers and dozens of startups, just in the immediate neighborhood. Some of them can walk to their new jobs right after graduation -- or even before taking their degrees. Hackathons and other geek gatherings are turning into job fairs, with employers coming in to check out the young talent.

The corporate employers like what they see in Midtown, and they are sticking around. The number of jobs in the neighborhood is expected to triple in the next few years, from roughly 4,000 to 12,000. Google, Siemens and ThyssenKrupp all have a presence there. GE and Honeywell have transferred their main digital operations to the city. NCR, which moved its headquarters from Ohio to suburban Atlanta less than a decade ago, is about to pick up and move again, into two new Midtown towers just north of the university. The result of all this is that Atlanta now has the third-largest concentration of Fortune 500 corporations anywhere in the country.

People in Atlanta will tell you about the spirit of collaboration that has energized the city, and one symbol of that collaboration is the partnership of Mayor Kasim Reed, a liberal African-American Democrat, and Gov. Nathan Deal, a conservative white Republican. Their relationship has been as productive as any city-state alliance in the country. At the same time, Reed has continued and even amplified the local tradition of aligning city hall closely with business interests. Unlike cities that rely on a cluster of companies in a single sector, the major players in Atlanta -- Delta, Georgia Pacific, Home Depot, UPS and Coca-Cola among them -- don’t compete with each other for customers. They’re able to work on projects together -- even make direct investments together. “We’re in a good space because of that foundation,” says Ceasar Mitchell, the city council president, “because of our ability as a city to work together.”

Cooperation is paying off. The rate of job growth in Atlanta is currently four times the national average. The city had been a poster child for suburban flight in previous decades and is still home to only 450,000 people, which is less than 10 percent of the metro area’s population. But Atlanta proper is now expected to double in size over the next 15 years and triple by 2050.

Every other week seems to bring the announcement of some new mega-development -- huge tracts of land being redeveloped alongside the new football stadium, or where the former baseball park now sits. Entire blocks near downtown are being renovated, while new parks are being constructed or planned atop highways and at an old quarry. Given its growth and the diversity of its employment base, alongside its traditional strength as a logistics and meeting hub, Atlanta’s long-held dreams -- of being the undisputed capital of the South and a truly global city, despite its relatively small size -- appear within reach.

 

Those are the stories Atlanta’s leaders are eager to tell, and none of them are make-believe. All of those good things are happening. But there are other stories, ones that testify to what might be called Atlanta’s paradox of progress. The neighborhoods that declined due to lack of investment are now being punished by the sudden influx of investment. Or at least many longtime residents are. Atlanta’s housing crunch is not as intense as in Seattle or Denver -- corporate recruiters love to brag about how much more house an Atlanta salary can buy than is true among its affluent competitors -- but outside the professional class, the crunch is becoming quite severe. Growth has led to horrendous traffic problems, making close-in neighborhoods much more desirable, but rendering those same neighborhoods unaffordable to the poor and working class. Longtime residents suddenly find themselves priced out. Evictions have become routine. “Atlanta and cities around the country have been great at building buildings, but not at including people,” says Kwanza Hall, a member of the city council.

About one in five residents of Atlanta is living in poverty, while another 25 percent of the economy consists of low-wage service jobs in hospitality, restaurants and retail. Residents in southern and western parts of metro Atlanta can only look on boom areas like Midtown with envy, while worrying that when and if revitalization comes to their neighborhoods, it might force them to leave. “We’ve been essentially importing our talent,” says A.J. Robinson, head of the downtown improvement district. “I’m not sure that’s sustainable.”

Atlanta has figured out how to be a successful city, but it hasn’t figured out how to be successful for everyone. That doesn’t make it unique in urban America. But the divide between the area’s winners and losers is worse than in many other places. Atlanta not only suffers from stark income inequality, but also has one of the worst track records when it comes to upward mobility. A resident of a struggling neighborhood like Vine City or Thomasville might live a short drive from thriving job centers, but physical proximity ends up being no help to someone lacking skills or education. Some community leaders are quick to cite the statistic that a child born into poverty in Atlanta has only a 4 percent chance of escaping poverty as an adult. “Growth has bypassed too many neighborhoods,” says former state Sen. Vincent Fort. “A child born in Grady Hospital, the inner-city hospital for poor people in Atlanta, has less chance than a child anyplace in this country of joining the middle class.”

Atlanta’s growing pains have become one touchstone in the city’s mayoral race this year. Fort, like city councilmembers Mitchell and Hall, is running. Reed is term-limited. Eight years ago, he won the race against Mary Norwood, then as now a member of the city council. Norwood came in first in the November 2009 election, but fell short of an outright majority, and then lost to Reed by 700 votes in the runoff. She is once again leading the polls, but with eight serious candidates in the race, another runoff appears inevitable, perhaps one that will be racially polarizing. Mitchell, Fort, Hall and most of the other major candidates are black. Norwood is white. “I would be surprised if Norwood’s not in the runoff,” says Michael Leo Owens, a political scientist at Emory University. “I would be surprised if she’s not elected mayor.”

The election of a white mayor would signal a sea change. In 1973, Atlanta became the first major city in the South to elect a black mayor. Now it faces the very real prospect of electing its first white mayor in nearly half a century. People in Atlanta endlessly refer to the city as the birthplace of Martin Luther King Jr. and a cradle of the civil rights movement. But the reality in this “black mecca” is that most black professionals have already moved out to the suburbs. They’re being replaced by affluent whites. Atlanta is still majority-black, but just barely. “The fact that the population is growing is mainly a function of whites moving to the city,” Owens says.

The increased white numbers far exceed the 700 votes by which Norwood fell short eight years ago. That alone might put her over the top. But this time, Norwood also is claiming support among African-American voters, some of whom believe black leaders have not always looked out for their interests, choosing instead to give in to business demands. “In a place where you have a black political elite, the fact that working and poor blacks are being pushed out of the city proper is problematic,” says Deirdre Oakley, a Georgia State University sociologist.

The candidates and the people around them seek to downplay the importance of race as a factor in the election. What is clear is that whoever wins will have to build coalitions -- between black and white, among neighborhoods and among classes. It’s almost impossible to talk with anyone in Atlanta politics or business today without repeatedly hearing terms such as “inclusion” and “access” and “equity.” “If all we do is gentrify and move people farther out, it’s only going to exacerbate the problem,” says Hala Moddelmog, president of the Metro Atlanta Chamber. “Will we get it right in Atlanta? I hope so. Is it difficult? Yes.”

The next mayor will inherit a strong hand from Reed. During his time in office, the city’s reserve funds have increased from a meager $7 million to $175 million. Six years ago, Atlanta overhauled pension benefits for its employees, saving the city millions annually. Two years ago, voters approved a $250 million bond package to improve roads, bridges, sidewalks and buildings. That seemed like a lot of money until last year, when they approved a sales tax increase that will provide an estimated $2.5 billion for MARTA, the local transit authority, to improve service and promote transit-oriented development. The latter package is so promising that now Emory and the federal Centers for Disease Control and Prevention are clamoring to be annexed by the city to get in on the MARTA action.

But the disparities between the struggling parts of Atlanta and its showcases are too stark for any political leader to ignore. They may force the next mayor to take a more populist approach, perhaps pursuing policies a little less favorable to developers and being a little less cozy with business in general. Even if that doesn’t happen, it’s apparent that Atlanta is starting to rethink its long-held strategy of growth regardless of cost. “When you have a moment of prosperity, it’s a moment of investment,” says Mitchell, the city council president. “It’s a moment to push the envelope when it comes to moving a city forward, but also when it comes to not leaving people behind."

 

One Atlanta leader who believes ardently in broader inclusion is Ryan Gravel. While he was in graduate school in the 1990s, Gravel wrote one of the most influential master’s theses of all time. He came up with the idea for what would become Atlanta’s Beltline, converting 22 miles of disused railroad tracks around the city into green space and walking and bike paths that may eventually also incorporate streetcar lines. Eighteen years after Gravel sketched out the idea, the Beltline is having a transformative effect on the city. The miles that have been completed, on Atlanta’s east side, are now packed on weekends and evenings with bikers, joggers and parents pushing strollers.

All along the Beltline, previously neglected neighborhoods are attracting investment, with new offices, shops and condos springing up all over. One area along the Beltline used to be so dangerous that the local grocery store was known as the “murder Kroger.” Now a new Kroger is being built at the same spot, as the anchor tenant on the ground floor of an upscale apartment building set for completion next year. Neighborhoods close to the Beltline have become so trendy that real estate agents advertise themselves as “the B-line Broker” or part of “The Beltline Team.” What is happening near the trail on the east side of town may happen in dozens of neighborhoods around the city since, as its name suggests, the Beltline surrounds Atlanta. “All the development is good,” Gravel says, “cleaning industrial sites and creating opportunities for new business.”

But as gratified as he is to see his vision come to life, Gravel isn’t completely happy with the effects the Beltline is having. Very few people are. Part of the city’s plan was to devote 15 percent of the funds raised for Beltline construction to affordable housing, through the use of a property tax abatement fund. Over the first 25 years of the project, 5,600 affordable housing units were supposed to be constructed. Nothing like that number, or even enough to keep pace with the goal, has been built. Concerned about the lack of attention to this issue, Gravel, along with the head of a local group fighting income inequality in Atlanta, resigned last fall from the board of the partnership that oversees the Beltline. In August, the project’s CEO stepped down, also due to complaints about the housing issue.

From 2011 to 2015, house prices in Atlanta rose 30 percent. A recent Georgia State study showed that property near the Beltline increased an additional 20 percent on top of that. Even if the number of new affordable units was constructed as promised, that wouldn’t have done anything about soaring prices for existing units. And nearly all the recent construction in the city has been luxury units. “Most of the city is seeing significant increases in property values and especially rents,” says Dan Immergluck, a housing expert at Georgia State. “It’s just much worse around the Beltline.”

Other parts of the city that are staging comebacks are feeling similar pressures. A nonprofit called the Westside Future Fund, which has received substantial corporate support, is trying to keep residents of four neighborhoods near the new football stadium from being pushed out by new development. Homeowners who are in place this year will receive a major subsidy from the group; all their future increases in property tax rates will be covered. “If you’re a homeowner and you’re concerned you’re not going to be able to afford taxes going up, we’ve taken that off the table,” says John Ahmann, the fund’s director. But he quickly notes that only about 8 percent of the people living in the west side neighborhoods are homeowners. And his group’s hopes of buying more property to provide affordable housing is a “big lift,” he says, in an area where investors can already see dollar signs.

That’s the problem with trying to outpace the market. Atlanta’s city council last year passed a requirement that developers who receive public incentives create more affordable housing. But once an area gets hot, it’s unrealistic to think that developers are going to be drawn to affordable projects that are less profitable than market-rate deals they can make elsewhere. Kwanza Hall oversaw an infill project in his council district that preserved dozens of units as low-cost rentals, but many more were built nearby that charge higher rents. “We’ve seen an influx of new people in brand-new units that were built by relatively opportunistic developers who were not part of our original planning process,” Hall says.

Hall notes that despite its recent growth, the city still has thousands of empty houses and apartments. According to Tim Keane, Atlanta’s planning commissioner, the city could accommodate a population of 800,000 just by occupying all the vacant lots and vacant buildings, nearly doubling in size without any redevelopment. Even fitting in 1.2 million people, Atlanta’s expected mid-century population, would only make the city as dense as Minneapolis, which is not one of the nation’s more crowded cities.

Keane and Gravel have been working on a road map for growth in the city. As might be expected, it promotes values such as equity as part of its framework. The fate of their plan will rest with the new mayor, alongside a city council that will be at least half freshmen following the election. As Keane notes, residents who already find traffic to be a twice-a-day struggle tend to doubt that the city will get better as it gets bigger. But more people are coming. Keane’s plan represents an attempt to figure out where they can best fit in, without causing undue disruption. Otherwise, the usual dynamic will apply: Longtime residents will try to thwart growth, especially in hot areas, which will push new arrivals into other neighborhoods that end up struggling with displacement.

Atlanta was built on the idea of newcomers. The city’s original name was Terminus, referring to its purpose as a railroad hub, the first usable land south of the Appalachians. Throughout its modern history and the recent decades of growth in the region, it’s attracted ambitious people from all over the country. Given Atlanta’s increasing prosperity and attractiveness, a much higher percentage of newcomers will settle within the city limits.

Whether Atlanta can accommodate more than a half-million additional people without forcing out longtime residents and working families is the biggest question the city faces. “If the Beltline ends up creating an Atlanta none of us can afford to live in,” Gravel says, “we made a mistake.”

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