During his recent swing through the city, Henry Cisneros, the secretary of Housing and Urban Development, praised five of the nation's six federal empowerment zones. But as for New York, well, Cisneros said: "New York is a challenge."
President Bill Clinton named six distressed urban areas -- sections of Atlanta, Baltimore, Chicago, Detroit, New York and a two-city area that spans sections of Camden, N.J., and Philadelphia -- as empowerment zones last December. Cisneros called the program, "the centerpiece of President Clinton's efforts in urban America."
Each zone is slated to receive tax credits for businesses that employ zone residents -- and $100 million in direct federal grants to be disbursed over 10 years. The borough, which is part of a zone that also includes neighborhoods in upper Manhattan, stands to receive $17 million of the federal dollars.
In its zone application, New York promised matching funds from the city and the state, for a total of $300 million for the entire zone, with $51 million for the South Bronx. But, facing massive budget deficits, both the city and the state are waffling.
The six zones share more than the promise of federal funding. They share unemployment rates that range from 17 to 29 percent and poverty rates, from 39 to 57 percent. In the borough's section of the zone, 43 percent of the population lives in poverty and almost 16 percent are unemployed.
The city zone faces hurdles that many of the other zones do not. It has been undermined by political infighting since its conception.
Rep. Charles Rangel (D-Manhattan) and Borough President Fernando Ferrer have fought each other to include larger numbers of their respective constituencies. Rangel, the 11-term congressman who drafted the zone legislation, won only with a concession to Ferrer and Ferrer's ally in the skirmish -- Mayor Rudolph Giuliani.
In recent days, a longstanding rivalry between Ferrer and U.S. Rep. Jose Serrano (D-Bronx) has become more noticeable.
"What difference does it make if one politician doesn't like another?" Ferrer responded to questions about the 10-year feud. City Councilman David Rosado is one of those who thinks the duel has undermined the borough's efforts.
"Political animosity between Serrano and Ferrer is endangering the money we could get for the empowerment zone," said Rosado. "Until they stop, corporations are going to be reluctant to get involved. They're afraid to put money into it."
While other zones have managed to leverage the federal funds to attract private investors, New York has lagged. Detroit has secured guarantees from the Big Three auto makers to invest $2 billion in private sector jobs. In Baltimore, the private sector has committed $800 million for zone projects. And Atlanta businesses have committed $1 billion.
"Our goal is to show the gold in the ghetto," said Kevin Melton of Atlanta. "We are trying to leverage as much private sector money to build private-public partnerships and stretch the federal money as far as we can."
In the borough, major potential employers -- such as Yankee Stadium and the Harlem River Yard -- have not committed to the program, said Kevin Nunn who is president of the Bronx Overall Economic Development Corp. The corporation, an arm of the borough president's office, will administer the borough's empowerment zone.
"Many potential investors are waiting to see more. They want to see what will happen in the first couple of years of zone funding," Nunn said.
But without an initial show of support from the private sector, there may not even be a couple of years of funding.
If the zone fails to produce new jobs and other measurable results, success of later efforts will be less likely, and funding harder to come by.
"You will have to prove to skeptics in the federal government and in the American public," Cisneros said, "that the cities of America are worth saving, and the people in them are not disposable."