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STEEL INDUSTRY Cities revitalize by embracing needed change



Published: Sat, July 2, 2005 @ 12:00 a.m.



Realizing when an industry is gone is the first step to recovery, one official said.

Fourth in a four-day series.

PITTSBURGH (AP) -- The nationwide economic boom of the 1990s skipped over neighborhoods in this city, where steel mills stood as empty, hulking monuments to a crumbling civic identity.

Mayor Tom Murphy responded by shepherding $1.5 billion in potential redevelopment on more than 1,000 acres of brownfields: luxury homes, office and retail buildings, and 27 miles of riverfront parks.

But the city nearly went bankrupt.

Today, Murphy says he was wrong to think redeveloping brownfields -- former industrial sites that could be contaminated -- was all it would take to save the Steel City. Like Cleveland, Worcester, Mass., and dozens of others, Pittsburgh is still trying to outgrow its Rust Belt roots as the steel industry continues to shrink to a limited number of companies -- most of them international.

A new approach

And while redeveloping brownfields is a key in each case, officials are learning that finding new industries, shoring up their tax bases and even civic psychology can be just as important.

"The first step to recovery is when a community realizes that an industry's gone. Until then, their recovery takes an extremely long time," said Robert Colangelo, executive director of the National Brownfield Association in Chicago.

"Look back at Houston in the 1980s," Colangelo said. "After the last oil bust, Houston decided to diversify ... into health care, high tech and other industries. Once a city makes that kind of a move, they can move beyond that path and they can change their market conditions."

To one degree or another, steel towns are trying to make that leap.

Worcester is the third largest city in New England with nearly 173,000 residents. The Worcester Business Redevelopment Corp. is transforming former U.S. Steel mill property into a mini-community featuring housing, retail and office uses, including Worcester Polytechnic Institute's Bioengineering Institute.

David Forsberg, the redevelopment corporation president, said Worcester is still wed to its industrial ethic. But with 14 colleges and universities in and around the city, Worcester's new commodity is life sciences and technology, not steel, he said.

State law help

But that psychological shift wouldn't have translated to bricks-and-mortar without a 1998 state law that relieved developers of liability for past environmental contamination.

"Before 1998, if you put a shovel in the ground you owned the whole [environmental problem]," Forsberg said. "One of the reasons so many of these sites had sat for so long is that people were afraid to clean them."

In Cleveland, they're trying to preserve the city's steel heritage -- while moving beyond it, too.

Faced with the reality that steel is no longer king, the cash-strapped city is now selling tourism -- Lake Erie, the Rock and Roll Hall of Fame, and plans for a revamped entertainment district -- and education and research at the Cleveland Clinic and universities. Businesses that used to be afraid to share space in a city where industrial pollution filled the sky are now being lured from the suburbs to downtown with the promise of low rent and tax deals.

After the city's finances collapsed in 1979 under then-mayor Dennis Kucinich, the city created a land bank of vacant residential properties. The city doles them out for $100 to anyone who will build new housing on them. When the program started, the price was $1. If new housing doesn't happen, the city takes back the land.

Growing success

Cleveland had 1,538 new homes built last year compared with just five building permits that were issued in 1979, said Chris Ronayne, chief of staff for Cleveland Mayor Jane Campbell.

That success has spurred Cleveland to set up a land bank for industrial properties. Although those properties will likely be sold at market rates, and environmental questions exist that don't plague most residential properties, Ronayne said the principle is the same.

"We sort of view ourselves as the frontier all over again," Ronayne said. "We have available land in a totally built-out county."

Colangelo, who calls Pittsburgh's Murphy the "grandfather of brownfields," said that was the mayor's genius -- seeing frontiers where others saw industrial dead ends.

"Now certainly in the mid-1990s, when I made the decision to start moving on these sites, it was by no means universally accepted that there was not going to be manufacturing anymore," Murphy said. "When we were in the midst of buying this property, people thought we were nuts."

Some people still do. Detractors say Murphy underestimated the impact of pulling more than $70 million out of city operating funds over 12 years to buy the brownfields.

Proud of changes

But Murphy chokes up when he speaks of the developments. "I mean, look at them -- let's go look at the before and after pictures and tell me they didn't work," Murphy said.

He's especially proud of Summerset at Frick Park. That's where 200 homes with manicured lawns sell for up to $600,000 each, and about 500 more are planned on 238 acres that were buried for decades in 300 feet of slag, a waste product from the steel-making process.

"I mean, it looked like the moon; nothing would grow there," Murphy said.

While that development and others have brought him kudos from architectural groups and national media attention, Murphy is frustrated that many people won't look beyond the city's $1 billion debt or the fact that one-fourth of its $400 million budget is earmarked to cover that red ink.

"It is a hard sell in Pittsburgh to say, 'Let's do something else,'" Murphy said. "In my mind, that transition is the single biggest challenge we face in this region."




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