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Ninth District • ommun1 Volume 2, Number 2 October 1987 The Queen City Comes Back When Marquette was a thriving shipping center for Upper Michigan's mining industry, it proudly called itself the "Queen City of the North"; but by the 1980s, the city had seen some tough times. Then a pair of ominous events helped impel Marquette into its impressive comeback. Wards, downtown's retail anchor, closed and downtown's aging infrastructure began to deteriorate. Prior to these events, Marquette had begun to plan downtown development in the 1970s as businesses moved to shopping centers west of town. In 1976, the City Commission formed a Downtown Development Authority (DDA). But the urgency of dealing with downtown's physical needs in a declining retail business environment helped property owners, retailers, and the city focus their near- and longer-term vision for the city. First National Bank President Marquette's revitalized Washington Avenue meets the Lake Superior shoreline. Plans are underway to develop a green space at the lakefront. COMMUNITY welcomes your ' comments and observations. You are also invited to share your commubity affairs program or community development initiatives with COMMUNITY by writing Carolyn Line, Community Affairs Coordinator, Federal Reserve Ban1c of Minneapolis, 250 Marquette Avenue, Minneapolis, MN 55480, or telephone 612-340-2048. To make address changes or to order additional coplE!s, contact COMMUNITY at the same address. Ellwood Mattson describes the development as a grass roots process that has involved business people, financial institutions, and the city. City Manager David Svanda adds that the catalysts combined at a time when each party was willing to accept the risks of comprehensive redevelopment. The city was committed to necessary sewer and street repair. Downtown merchants and property owners demonstrated their commitment by asking to be Produced by lhe Federal Reserve Bank ol Minneapolis assessed for extensive sidewalk and landscaping work. There was also a keen awareness that downtown needed systematic marketing and business development. As development momentum began to grow early in the 1980s, Marquette inventoried its assets. High on the list were the town's usable historic buildings; and for the first time, people looked seriously at the lakeshore's potential. To make the most of its historic buildings and at the same time develop business downtown, Marquette became a National Trust for Historic Preservation Main Street City in 1984. (See page ·3.) As work progressed on streets and sidewalks, Main Street Marquette coordinated downtown's marketing · and preservation. Major infrastructure improvements were completed in late 1984, and in 1986, the DDA coordinated construction of a much-needed downtown parking facility. Lakeshore development is a longerterm goal. The Lake Superior shore adjacent to downtown had been an industrial area since the late 19th century when the harbor was Marquette's gateway. As the town's business developed, however, it physically turned away from the industrial harbor area and the lake. With a renewed and vigorous downtown and declining industrial usage of the lakeshore, Marquette undertook to develop the area into an attractive space that would also reinforce downtown's development. Much of the lakeshore area is now being turned into public "green" space. The city has helped out with infrastructure continued on page 4 Main Street Center: Bringing the Past and the Future Together Established by the National Trust for Historic Preservation in 1980, the National Main Street Center focuses on the special problems faced by aging small city downtowns. It is a human resource and technical reference center that provides assistance in stimulating economic development within the context of historic preservation. In 1977, the National Trust, in an attempt to creatively preserve buildings in older, small-city commercial areas, launched a pilot program involving three Midwestern towns. Its goal was to develop a comprehensive strategy for economic revitalization emphasizing Main Street's historic assets. The need was apparent. Even in many small communities, downtown businesses declined as discount stores and climate-controlled shopping malls located on the edge of town. These were easily accessible by highways that bypassed the central business district. In response to this turn of events, businesses often tried to compete by modernizing building facades (and hiding ornate architectural details), adding garish signs, or closing main streets to vehicular traffic. These plans failed for the most part because they ignored the inherent assets and individual character of an older downtown: rich architecture, personal service, and traditional values. After three years of intensive analysis and on-site involvement in all aspects of revitalization in the three community laboratories, the National Trust expanded the Main Street approach. The National Main Street Center was established in 1980, and a demonstration project was undertaken that involved 6 states and 30 small cities. Of the 30 demonstration cities, 28 formed new downtown organizations or strengthened existing ones; 28 established lowinterest loan pools or subsidy programs to encourage facade renovations and building rehabil- The Evans Hotel, built in 1892, is located in Hots Springs, South Dakota, one of the original three Main Stree pilot communities. Now home to senior citizens, the Evans was restored through the efforts of the Hot Springs Housing and Redevelopment Commission with the support of the community and was completed in 1980. itations; and 5 of the demonstration states added communities to the program. Currently, more than 300 communities have made the basic three-year commitment to the Main Street approach. What is this magical formula that can turn neglected downtowns into thriving business districts? It is a pragmatic, integrated four-point program that builds on the idea of the downtown's total image and encourages public/private partnerships. Ironically, the Main Street approach uses the management strategies of modern shopping malls, whose proliferation initially contributed to the decline of downtowns. It is also incremental in nature, producing highly visible, short-term results, while creating fundamental changes in leadership and the economic base of downtown. The four interrelated elements of the Main Street approach are organization, promotion, design, and economic restructuring. Organization. Strong, _unified leadership by downtown mer- chants in partnership with financial institutions, city government, the chamber of commerce, and others is essential to the development of a consistent revitalization effort. Formation of a nonprofit downtown association is one way to create an organized program. Promotion. It is essential to promote and advertise using special events to convince people that downtown is an exciting community stage, a meeting place bursting with activity. Promotions can include special retail sales and festivals and creation of a consistent image through graphics and media presentation such as a special logo and a downtown directory. Design. An attractive downtown appearance is one step in building the confidence of merchants, investors, and shoppers. Rehabilitating tired facades and installing street landscaping, new signs, and bright window djsplays will add to the pleasure of shoppers and other visitors. Economic Restructuring. All elements of the Main Street approach should create a climate for reinvestment. Because downtown competes with the suburban mall, it is essential that the downtown economy be diversified. Activities include recruiting new stores to provide a balanced retail mix; converting unused space into housing, offices, entertainment, or cultural facilities; and sharpening the competitiveness of Main Street's traditional merchants. The National Main Street Center offers a number of publications and slide show packages to assist local efforts in the promotion of downtown revitalization. For more information, write to: National Trust for Historic Preservation National Main Street Center 1785 Massachusetts Avenue N.W. Washington, DC 20036 John Stevens, Main Street Marquette project manager, lived in many cities before he retired from the Air Force as a lieutenant colonel. During 28½ years in the Air Force, John was stationed twice at K.I. Sawyer AFB. He and his family chose to make the area their permanent home. ., Main Street Marquette mana_ger hil May 1981., I~ May 19.84, when ·Main Street Marquette was jlli!t · getting started, business on m~in street, Washington Avenue, was slow. There were ten empty storefronts in the prime shopping_block alone. 'l'oday, the central business di~trict is booming with all storefronts oecupied and 75 percent !)f office space rented. In the midst of a maj0r pliblfo improvement project' · that literally tore mafn street apart (see page 1), downtown began to market itself. Main Street Marquette arid' downtown merchants urged pe0ple to "dare the ', detours" and shop (iowntown. In November 1984, public improvements were completed and Main Street To reverse a decade of neglect of the central business , · Marquette coordinated a thre~~day promotion with a district, the City Commission' formed a Downtown , variety of festivities. Reta-il sales for that holiday·season Pevelopment Association-(DDA) in 1976. A1;1 the DDA were 14 p~rcent higher than the previous year. and local people cataloged, the town's assets, they realized that an important one was Marquette's historic During 1985,'using a Facade Giant from the.Michigan buildings. The Main Street program was thus viewed History Bureau, Main Street provided property owners by the DIJA as one avenue for downtown revival. When with architectural renderin~ mnd cost estimates for revitalization around a historical theme wa1; favored exterior renovatfons. Several improvements were by respon,dents to a 1988 survey, the DDA further ex: • undertaken that year. ln·mid 198{i;, a two-level parking · plored .t he Main Street option. Goals for the'central facility developed by the DDA opened; and as 1985 blli!iness distrie:t were· consistent witli those of the came to a close, retail space was 80 perceqt rented. National Main Street program-to stimulate downtown 1986 brought a full schedule of downtown promotions econo~ie growth within th~ context of historic preser~ . and special events, more facade impravements and vation. Marquette applied to become a Main Street eity interior rehabilitation, and t)le beginning of an ongoing and received designation in February 1984. education program for downtown busfness people. :l . . ' ' A~ 11-member Board of Directors formed iJi March 1984 includ_ed representatives frofr). both public, a~d private sectors. C.urrently;&oth First National Bank and First of America Bank are represented on-the Board. In May, the Board named Lori Bulera project manager. Lori guided Main Stree Marquette through its first thTee years;-John Stevens was n~med project _A su~cessful down1lown revitalization progra~ is a selt: help program, which'. means that both the public and · private sectors must be wil1ing to share the costs. In Marquette, total investment since 1984 has been nearly $7 million. Of this, 58 percent (lncluding special assess.. ments) was private inv~stment. Governt:nent fund~ con~nued on page 4. Queen City continued from page 1 improvements, and organizers have raised much of their $100,000 goal. The fundraising effort has been largely volunteer. By improving the lakeshore and creating recreational space, planners and organizers hope to stimulate economic use of the area. They also see the harbor as a natural extension of downtown. Their objective is to emphasize the central part of downtown and the harbor as a whole to avoid creating two distinct destinations. Marquette's investment in its downtown is now close to $7 million. Of this, 58 percent (including special assessments) is private investment. Total project funding has been complex, involving five or six funding sources. Marquette has used these funds and other investment incentives creatively. For example, the city originated a special assessment tax credit that allowed property owners to reduce their special assessments through dollars spent on improving their property, on a 2 to 1 basis. Mar- quette also lent proceeds of a Small Cities Block Grant to property owners for improvements, creating an income stream (principal and interest payments on the loans) dedicated to servicing municipal debt issued to build the parking facility. Local lenders have also been important. Ray Beauchamp, a local retailer, once observed that when things were tough and we needed the bankers, "they didn't run away from us." The investment has paid off tangibly for Marquette. Since redevelopment started, 40 businesses have opened downtown bringing 79 full-time jobs; 17 existing businesses have expanded, creating 47 additional jobs; and retail sales have increased dramatically. Marquette expects better things yet to come. While there are outstanding land acquisition questions, lakeshore development is progressing. Downtown Washington Avenue and adjacent streets are doing well, and townspeople have turned their attention to the longer term. Underscoring their success, townspeople frequently refer to "enthusiasm," "team effort" and "pride," and to the depth of the volunteer effort. People emphasize that successful redevelopment is a self-help process that involves willingness to agree on a common direction and to support the effort with time and money. The ability of the city, merchants, financial institutions, and individuals to plan strategically and to back it up with personal commitment is the linchpin of Marquette's success. This newsletter is designed primarily to assist financial institutions in the Ninth Federal Reserve District in developing credative responses to consumer issues and to the goals of the Community Reinvestment Act. COMMUNITY is produced under the direction of Richard K. Einan, assistant vice president and community affairs officer, and Carolyn P. Line, community affairs coordinator. COMMUNITY is available without charge from the Office of Public Information, Federal Reserve Bank of Minneapolis, Minneapolis, Minnesota 55480 (telephone 612-340-2048). Articles may be reprinted if the source is credited and the Federal Reserve Bank of Minneapolis is provided with copies of reprints. Main Street Marquette continued from page 3 invested were 10 percent federal, 19 percent state, and 13 percent city. Today, street-level occupancy is 100 percent; 40 businesses have opened and 17 existing businesses have expanded. The three-year retail sales average compounded annually for November and December has increased 30.2 percent. John Stevens says that no one person or group is responsible for Marquette's success-that it reflects the hard work and shared efforts of downtown merchants and financial institutions, the Downtown Development Authority, Main Street Marquette, and the city of Marquette. The only major weakness that Stevens sees is Marquette's lack of a stable manufacturing industry base. But the town's historic flavor and its location on Lake Superior are real assets. "The town has been through a rough time," says John, "but it's on the rebound." Main Street Marquette will continue to be a part of Marquette's comeback. The Board of Directors voted this spring to continue the program for at least two years. OPPORTUNITIES AND ISSUES FOR BANKS IN AFFORDABLE HOUSING A Summary of a Roundtable Sponsored by the Office of the Comptroller of the Currency December 3, 1986 For information and copies, contact: Marianne Freeman Customer and Industry Affairs Division Office of the Comptroller of the Currency 490 L'Enfant Plaza S.W. (Phone: 202/287-4169) Washington, D.C. 20219