CHAPTER 5 : METROPOLLITAN VITALITY: URBAN / SUBURBAN DISTINCTIONS Do the interests of cities and suburbs coincide? . . . Do suburbs need cities?” Richard Voith Are Bay Area urban and suburban areas on different trajectories, with a sunny future for the suburbs and a bleak one for cities and older suburbs? Various measures are compared and contrasted to explore this question, including: education, crime, municipal finance, income and poverty, race/ethnicity, and civic participation. Taken together, these variables suggest areas of strength and some areas of concern for regional vitality. Education The proportion of the Bay Area adult population with an advanced degree surpasses that of all other regions in California, major regions throughout the country, and the national average. The relative distribution of educational attainment for the Bay Area, California, and the United States is shown in Figure 5-1. In 1990, about 31% of the Bay Area adult (over age 25) population had attained either a bachelor's, graduate, or professional degree. By comparison, the corresponding attainment level for California was 23% and for the U.S. was 20%. In recent years, the salary premium associated with higher levels of education has risen significantly, as has the "pay penalty" associated with lower levels of education. For example, over the span of one decade (1980-1990), the median wage of a San Francisco worker with a graduate education rose by 34%. This is in stark contrast to the declining wage expectation for workers with only a high school degree (13% decline) and those with no high school degree (16% decline). (See Figure 5-2.) Moreover, this gap will likely widen, since education is key to securing new jobs — which tend to demand higher basic communication skills than in the past — both the information-based high-paying jobs as well as the new entry-level jobs. While the cities of San Francisco, Oakland, and San José show similar, but slightly higher, attainment levels compared to the regional average for advanced degrees, they also have a higher percentage of population with less than a high school diploma. The disparity at the bottom end points to a challenge for urban areas which have higher numbers of hard-to-employ people. Primary and Secondary School Performance School performance is also a critical issue for urban areas. While the high educational attainment of Bay Area adults is compelling, it includes many people who have relocated to the Bay Area from elsewhere. While these highly-educated individuals contribute immeasurably to the labor force, primary and secondary school performance is the gauge for future labor force preparedness. A comparative review of Scholastic Aptitude Test (SAT) scores for a sampling of urban and suburban communities reveals: unweighted average urban scores that are 34 points lower on verbal and 41 points lower on math (see Figure 5-3). Disparities in eighth grade reading California Assessment Program (CAP) scores for the same communities were more significant: the (unweighted) average ranking for the urban communities was a CAP percentile of 40, compared to 71 for the suburban communities (Figure 5-4). Summary High educational attainment is a significant strength for the Bay Area in a competitive global environment. However, disparities do exist between urban and suburban areas, especially for the percentage of population without a high school diploma and in school performance rankings. These distinctions raise issues of future labor force preparedness, and if they persist, will continue to drive suburban relocation for households with school-age children, dampening overall prospects for urban economic vitality. Crime Crime, and the fear of crime, is currently a prominent topic in public and political discourse at all levels (national, state and local). The focus has been particularly acute in recent years. Crime is relevant to this study because higher crime rates are often linked to urban life, while a perception of lower crime rates and greater security is often cited as a strong motivating factor behind suburban location decisions. For the last two years, Bay Area Poll7 respondents identified crime as the number one problem facing the region. Different geographic response patterns for San Francisco versus the four-county North Bay subregion (Marin, Napa, Solano and Sonoma) are interesting. San Francisco residents were much less likely to identify crime as the top problemi (26% for San Francisco, compared to 40% for the North Bay). They were also much less likely to feel that crime is worse this year compared to last year (57% for San Francisco, compared to 80% for the North Bay). Public perceptions about crime do not always coincide with crime statistics. Violent and property (nonviolent) crime statistics were reviewed for the region, Bay Area counties, and the 3 largest cities at five year intervals between 1980 and 1995. Overall, there has been a downward trend in property crime, relative stability in violent crime, and higher overall crime rates in the 3 cities compared to the rest of the region. Between 1980 and 1995, regional per capita property crimes decreased 35% from about 72 per 1,000 residents to 47 per 1,000 residents. In general, all counties showed downward trends over time. Violent crime in the region, however, varied slightly, from about 7 to 8 incidents per 1,000 residents. A focus on the individual city-level crime statistics for San Francisco, Oakland and San José reveals trend lines similar to the regional averages. However, San Francisco and Oakland statistics show higher crime rates than for the region as a whole, while San José statistics approximate regional averages. Race/Ethnicity Overall Region The Bay Area boasts a high level of ethnic diversity. For example, San Francisco ranks fourth in the nation (among large cities) for foreign-born population (34%). In particular, the Bay Area has a relatively high percentage of Asian and Pacific Islanders, outranked only by Honolulu. Table 5.1 shows both recent and future overall regional change in population shares by racial/ethnic groups. As shown, the White, Non-Hispanic share declined by about 8% between 1980 and 1990; the Asian-Pacific Islander and Hispanic shares rose about 6% and 2%, respectively, and the African- American share stayed constant. These are fairly large proportional shifts in a population of some 6 million, over a single decade. However the projected future changes in racial/ethnic composition are just as dramatic. Between 1990 and 2015, the Asian-Pacific Islander population is projected to increase by about 690,000, and the Hispanic population by about 680,000. This compares to projected increases of only 170,000 for White, Non-Hispanic and 160,000 for African-American. Thus, common connotations of the terms “majority” and “minority” will no longer hold, as the White, Non-Hispanic population drops below a majority (48%) by the year 2015. Focus on 3 Cities While there will be no majority racial/ethnic group for the region as a whole by 2015, a focus on the 3 largest cities (San José, San Francisco, and Oakland) shows that basic reality is already true in the major cities. So while the 3 cities’ relative share of the regional population has remained nearly constant, the racial/ethnic composition has changed significantly. Table 5.3 shows the relative shares by race and ethnic group for 1980 and 1990 for the 3 cities, compared to the remainder of the region. There are significant differences: in 1990, the 3 cities had higher shares of Asian-Pacific Islander (10% higher), African-American (9%), and Hispanic (6%), and a 25% lower share of White, Non-Hispanic. Challenges and Opportunities for Urban Areas The fact that urban areas have relatively higher levels of ethnic diversity and foreign-born residents presents both challenges and opportunities. Challenges include traditionally higher rates of poverty and unemployment, and relatively lower rates of educational attainment, for nonwhite populations. Among other issues, this means higher demands for social services, issues for schools regarding the number of students with a multiplicity of first languages other than English, and a larger segment of hard-to-employ people in the local labor force. Opportunities include diversity as a catalyst for innovation and an exchange of ideas, and potential advantages in an environment of global competition, based on shared language, heritage, and customs and on continuing contacts with friends, family, and business associates abroad. Of particular note in the Bay Area is a comparative advantage for potential links to the Pacific Rim. In 1961, Jane Jacobs wrote on what contributes to the success of a city. Her second criterion after density was diversity. Arguably, diversity represents an even stronger potential force for success today than 35 years ago, and the cities are on the cutting edge of a new pluralistic society. Income Issues germane to this study include relative overall household income and poverty rates, and geographic disparities between and within communities (such as pockets of poverty). Median Household Income In 1989, the Bay Area median household income stood at $41,600. Bay Area income is high relative to comparable regions (second only to New York), and has also been fast-growing. For example, between 1989 and 1995, the average Bay Area household income rose by 22.6%.44, ii Household incomes, however, are not evenly distributed throughout the region. Figure 5-7 shows both absolute and relative variations in average census tract median incomes (above and below the median). As illustrated, there is a pattern of lower median incomes in the 3 cities and in the “inner ring” and older suburbs hugging the Bay. Concentrated areas of higher median incomes are found along the Interstate 280 corridor in San Mateo and Santa Clara counties, along the Highway 24 and Interstate 680 corridors and in the Berkeley/Oakland hills. Median household incomes in San Francisco and Oakland ($33,400 and $27,100, respectively for 1989) are significantly lower than the regional median. The San José median, however, at $46,200, is above the regional median. Median household incomes rose in about 70% of all Bay Area cities between 1969 and 1989 (adjusted for inflation). However, the areas of income decline are concentrated in the older cities and inner-ring suburbs. Figure 5-8 highlights locations of citywide increase and decrease in median household incomes for this period. Poverty Poverty rates for both the general population and for children rose in the early 1990s. This was not unique to the Bay Area and, in fact, poverty rates in this region are generally lower than average for California, the U.S. and for comparable large metropolitan regions (this is partly due to higher over all incomes and cost of living). The deep recession of the early 1990s, combined with military base closures and defense cutbacks were clearly influential, and hit California and the Bay Area hard. However, recent statistics indicate these trends may be reversing. For example, U.S. median household income rose by 2.7% and the poverty rate decreased from 14.5% to 13.8% for 1995, compared to 1994.iii However, recent gains have not made up for earlier declines. For example, the percentage of Bay Area children living in poverty rose by nearly 4% between 1989 and 1994 (11.5% to 15.3%).8 Also, poverty rates and the concentration of people living in poverty are much higher in the urban areas. Figure 5-9 illustrates the concentration of persons living in poverty in 1989. High poverty concentrations are found in the major cities and in the older inner-ring suburbs surrounding the Bay. All but two of the communities with the ten highest poverty rates are located in this inner ring. Poverty rates in San Francisco and Oakland (12.7% and 18.8%, respectively) were significantly higher than the regional average (8.5%). San José had a 9.3% poverty rate. In 1989, seventy-seven Bay Area census tracts had a poverty rate greater than 25%. Of these, roughly two-thirds were in the 3 largest cities. Race and Poverty Correlations exist between race and poverty. For example, the 1989 Bay Area average poverty rates were 6.0% for White, Non-Hispanic; 13.9% for Hispanics; and 19.9% for African-Americans. In addition, poverty rates across all racial and ethnic groups are higher in urban areas. Summary Income disparities between central city and older suburban areas are significant. San José, however, is anomalous as one of the three largest cities with a higher median household income than the regional average. Another distinction between urban and suburban areas is the level of disparity within communities. Income maps highlight proximate affluence and poverty in major cities like San Francisco and Oakland (see Figure 5-10). Suburban and rural areas, in contrast, tend to be more homogenous. Municipal Finance Local government expenditures for a sampling of urban and suburban communities were reviewed to explore overall per capita taxes; overall per capita expenditures; and per capita expenditures in different categories (e.g., capital investment, versus social welfare, versus parks and recreation). Table 5.4 presents a comparative summary based on data for central cities and older suburbs contrasted with a sampling of newer suburban communities. Both per capita taxes and municipal expenditures were higher for the urban communities. “Urban” taxes were about 32% higher for the communities sampled. Average per capita urban expenditures were about 53% higher than for the suburban areas (San Francisco was excluded to avoid possible distortion since it is both a city and a county). A comparison of the relative share by expenditure category was performed to examine whether different patterns emerge for urban and suburban municipal expenditures. The question was whether urban expenditures leaned more to categories like public safety, whereas suburban areas might be able to spend more on desirable "amenities" like culture and leisure or higher capital investment. However, this review did not reveal strong differences between the samples. The suburban areas did spend about 5% more of their total expenditures on culture and leisure, and the urban areas spent about 4% more for transportation. With respect to absolute expenditures, while urban and suburban areas each spent approximately the same on a per capita basis for culture and leisure, urban areas spent about 1.54 times as much per capita on public safety. Civic Participation: Voting and Representation Academic and popular literature points to voting and voting registration patterns as basic indicators of the level of citizen participation in local civic life. Widening gaps in voter participation have been noted based on income and class. For example, national voter turnout among professions associated with middle and upper incomes, versus turnout among manual laborers (including skilled crafts workers), changed significantly between 1964 and 1980. In 1964, the relative turnout was 83% (higher income workers) to 66% (lower income workers); by 1980, the respective turnout comparison was 73% to 48%.13 Drawing from this literature, an attempt was made to identify whether differential patterns of “civic participation” exist between urban and suburban areas. A fairly cursory review of voter registration and turnout was performed for this study. First, registration (as a percentage of the adult population over the age of 18) was tabulated for a sampling of urban and suburban areas. Second, actual voter turnout (again compared to the overall population over the age of 18) was reviewed for a smaller sampling. As Table 5.5 shows, sizable differences were identified between the urban and suburban communities reviewed, both for registration and actual voter turnout. The gap was especially wide for voter turnout compared to the adult population; the range in urban communities was 26% to 52%, which is well below the corresponding range in suburban communities of 53% to 72%. Note that the 1992 presidential election year was selected for voter turnout reporting. A non-presidential election might unveil an even wider spread.iv Several factors are likely contributing to the differences noted between the urban and suburban communities. As postulated, part of the difference may be due to higher levels of civic engagement in the suburban communities selected. A second key influence is also undoubtedly the issue of voter eligibility. For example, as discussed earlier, San Francisco’s population includes a high percentage of foreign-born persons. Since urban areas have higher numbers of immigrants, they could also be expected to have a higher share of noncitizen (and thus ineligible) residents. A third factor is income: as noted, researchers indicate widening gaps in voter turnout related to income, with more affluent citizens more likely to vote (and an increasing gap over time). A more complete analysis would look at other measures of civic engagement, and might include factors such as representation in elected office and appointed boards and commissions by geography and race. As one example, a recent study by the Latino Issues Forum14 reviewed Latino representation on Bay Area commissions and boards relative to the proportional population share, and found significant under-representation. Civic engagement is a measure of community success, along with more commonly used economic and demographic measures. As we move toward an ever more pluralistic society, thriving communities will depend on greater civic integration. Conclusions The Bay Area, like all regions, is dynamic. While certainty about the future is elusive, past trends and future indicators (including technological changes which allow greater locational freedom, institutional investment decisions, economic restructuring, etc.) all generally point to growing relative influence for the suburbs in the metropolitan region. Moreover, the Bay Area exhibits many characteristics indicating a strong competitive positioning in the “global economy.” However, while Bay Area central cities, in general, have not exhibited the extreme levels of urban decline of some areas of the U.S. — nevertheless, there is sufficient cause for concern about overall metropolitan vitality based on disparities within the older cities as measured by higher percentages of hard-to-employ people, disparities in median household income and poverty, higher crime rates, disparities in municipal expenditures, and questions regarding civic participation and overall integration in a pluralistic society. The information presented in this chapter reinforces many of the conclusions reached by the Bay Area Economic Forum in a report on the region's comparative economic performance.8 Although the Bay Area has numerous compelling strengths and advantages, there are also several major challenges for the economic health of the region: • poor and worsening primary and secondary education performance • low discretionary income due to very high housing costs and taxes; • worsening crime and poverty; and • high cost of doing business. While the issues cited above are faced by all communities to some degree, they have particular resonance in the major cities and older urban areas. If indeed these are potential obstacles to stellar regional economic vitality, shared regional success demands attention to these problems.