Industrial Retention and Land Use Controls

            Industrial retention refers to a range of activities designed to respond to the needs of local businesses, including infrastructure improvements, safety concerns, technical assistance, supply-chain support, employment training facilities, and the creation of business networks (Fitzgerald and Leigh 2002: 102). Industrial retention is not the same as business attraction inducements, which remain the dominant approach to economic development in many urban areas. Industrial retention policies put a city in a more proactive position in terms of shaping its economic base (Fitzgerald and Leigh, 2002: 13). Such land-use policies are argued from a social justice perspective because proponents of industrial retention firmly believe in the value of manufacturing-type jobs over service employment as a way of reducing income inequality (Fitzgerald and Leigh 2002: 102; Byron and Friedman 2012: 95).

            Issues of industrial retention are often explored alongside other processes of gentrification and urban revitalization (Lehrer and Wieditz 2009). Urban studies discourse questions the kind of employment offered by new developments, particularly those that fall under mixed-use – both employment and residential. Many critics of such mixed-use urban revitalization highlight the importance of built form, arguing that employment offered by new, mixed-use developments tends to be low-end, unsalaried retail positions or alternatively, limited high-wage, high-skill positions (Grant 2002; Lander and Wolf-Powers 2008). Unlike in most of the service sector, manufacturing positions on average produce higher wages and provide the possibility for benefits. Industrial retention is in many ways a direct contrast to speculative real estate. Critical discourse on industrial retention draws connections between issues of market-driven land-use planning and the lack of social equity placed in upon new development.

            Since the 1980s, the City of Chicago has encouraged industrial businesses to locate in the city through the use of Planned Manufacturing Districts, or PMDs (City of Chicago 2011). This type of zoning discourages the incursion of retail and residential development, which threatens industrial operations through noise and traffic complaints. One of the most significant aspects of PMDs is the focus on land use features that are specific to industrial users. Planned Manufacturing Districts are generally located near important arterial transportation networks and around other industrial and manufacturing amenities. Another major aspect of this type of zoning is the tax incentive provided by the city for industrial/manufacturing businesses to locate into a PMD. While there is no guarantee that a business will remain in or locate to a particular area, incentives have been a proactive approach to achieving this goal. Part of the City of Chicago’s rationale for specific urban manufacturing zoning is that such types of employment produce greater wages than retail or service sector work (City of Chicago 2011: 4). In this sense, PMD zoning is a clear effort by a municipality to establish greater economic diversity from land-use controls that prohibit speculative real-estate.

            Focusing on New York City, Laura Wolf-Powers argues that “shielding industry from the volatile dynamics of the real estate market is good planning practice either because it leads to a more acceptable distribution of wealth (in the case of the jobs argument) or because it produces an industrial mix that prevents vulnerability to overspecialization and contributes to a ‘balanced growth’ strategy in the long term” (2005: 382). This notion of balanced growth is not always reflected in arguments for mixed-use areas, which tend to focus on aesthetics and neighborhood transformation. In NYC, specific industrial district programs provide transparency and certainty to owners of industrial property, creating a stable climate for investment (Landers and Wolf-Powers 2004: 26). Similarly, in her research on mixed-use zoning, Jill Grant found that business owners from industrial sites worried about residential incursion that could lead to traffic and noise complaints; industrial zoning would allow for greater confidence in the stability of their investments (2002: 76). New York City currently operates an Industrial Business Zone (IBZ) program that offers incentives for manufacturing businesses to locate in specific areas (NYC 2005). This program helps to retain industrial/manufacturing business in the city in an effort to create clusters with high-wage and skilled employment opportunities. By offering a one-time tax credit and direct assistance through agencies like the city’s Small Business Services, the IBZ program encourages businesses to remain in New York rather than locate to less expensive areas outside of the city. IBZs are different from PMDs in that they are not a type of zoning, but rather a set of conditions that fall upon existing industrial zones. IBZs take a program approach, grouping a number of different city services to address industrial business needs.

            In the United States and Canada, urban revitalization has often focused on the conversion of industrial areas to mixed-use places of high-end residence and commerce. These redevelopments have involved substantial changes to zoning, as comprehensive and official plans claim the need to diversify and restore inner-city streetscapes, economically and aesthically. This is significant on a suburban scale as well, as predominantly industrial inner-suburbs have begun to experience new forms of industrial displacement and threats to productivity. Industrial zone programs from other jurisdictions offer insight into the successes and challenges of new land-use controls to protect jobs.