A dozen years ago, Governing published a story about how older, inner- ring suburbs were starting to suffer problems imported from the big cities, such as high crime rates, a declining tax base and struggling schools. Back then, University City, just west of St. Louis, served us well in illustrating all those trends. But it turns out that decisions University City had already made in 1993 are paying off now.

The city's formerly dark and gloomy commercial drag, known as the Loop, has been transformed through streetscaping, traffic calming and an ordinance that has generated an abundance of ground-floor restaurants and retail. The Loop's shops, theaters and bars stay busy well into the small hours. "It's safer than mall parking lots," says Joe Edwards, a local restaurateur. "I've seen the numbers." Housing prices, meanwhile, have shot up so high that the city will have to roll back property tax rates this fall.

U City officials are convinced that one of their secrets has been strict occupancy permits and building codes. The local government isn't afraid to sanction storekeepers or homeowners who don't keep their property up; in turn, fear of fines that range up to $1,000 makes a visible difference. Along Sutter Avenue, the houses on the west side of the street, in U City, don't need a lot of paint or new steps. Right across the street, in the adjoining town of Wellston, grass grows high and fences are falling down.

While other St. Louis suburbs panicked in the face of white flight, U City stood out for its embrace of diversity. U City was a pioneer in fair-housing laws during the 1960s. Today, Mexican and Asian vendors share stalls at the farmer's market, and a Greek tavern sits next to a kosher butcher shop--outward manifestations of the ethnic and cultural mix that appeals to residents who want to be close to jobs in downtown St. Louis and skip the commute from ever-sprawling outer suburbs. As a result, people who can afford homes anywhere in the metro area are settling in U City.

Some neighboring communities also are doing well--including nearby sections of St. Louis itself--but that isn't the whole story. A large number of local suburbs are struggling financially, laying off city workers or living off lines of credit. In Wellston, the city administrator and mayor both quit abruptly this spring, leaving residents wondering who was in charge of the financial mess they left behind. (It's more clear who's running the local schools: The state just took them over.)

University City is hardly a paradise. Violent crime is down but the city still suffers from "more than our share of larceny," admits police Chief Lee Payne. As in so many other metropolitan districts, the elementary schools are fine but the middle grades on up through high school are abject failures.

But U City has come a long way since 1993 and will have a lot to boast about at its centennial next year. Inner suburbs elsewhere in the country could stand to study its experience.