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    The Rationale for including Disadvantaged Communities in the Smart Growth MetropolitanDevelopment FrameworkAuthor(s): Daniel J. HutchSource: Yale Law & Policy Review, Vol. 20, No. 2, Symposium: Race, Values, and the AmericanLegal Process: A Tribute to A. Leon Higginbotham, Jr. (2002), pp. 353-368Published by: Yale Law & Policy Review, Inc.Stable URL: http://www.jstor.org/stable/40239583

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    The Rationale for Including DisadvantagedCommunities in the Smart Growth MetropolitanDevelopment FrameworkDanielJ. Hutch1

    WhileBrownv. Boardof Educationmarked hebeginningof the end of dejurediscriminationn American ociety,1 he decision did not lead to de factoequalityfor African-Americans,Hispanics,and membersof other disadvan-tagedgroups.Notwithstandingheeffortsof distinguisheduristssuch as JudgeA. LeonHigginbotham,r.,the economicdisparities etweenblacksandwhitesactually ncreasedn the aftermath f theBrowndecision especiallyfor blue-collarworkers.2In theyearssinceBrown,wealthyandmiddle-classwhiteresidents,as wellas manybusinesses, eft urbanareasto relocate o surroundinguburbs.3 hisexodusled to a vicious cycle of declinefor older andpoorerurbanneighbor-hoods,producingan increase n unemployment4ndcrime,5as well as lowerpropertyvalues.6This erosionof the urban ax base, in turn,resulted n thecurtailment f municipal ervicesand decreased unds for education n these

    t Economist,The SmartGrowthNetworkand the U.S. EnvironmentalProtectionAgency. M.A. inPublicPolicy Studies,Universityof Chicago,public sectoreconomics concentration;B.A., economics,Universityof Illinois at Chicago.This paperreflectsthe author'spersonalviews and does not representthepositionof the U.S. EnvironmentalProtectionAgency.1. Brownv. Bd. of Educ, 347 U.S. 483, 495 (1954) ("[I]nthe field of public educationthe doc-trine of 'separatebutequal'has no place.").2. See John Hope Franklin, From Slavery to Freedom 479 (5th ed. 1980) (statingthat,duringthisperiod,unemployment atesfor African-Americanswere morethan doublethatof whites).3. William Julius Wilson, The Truly Disadvantaged: The Inner City Underclass andPublic Policy 121 (1987) (claiming that manufacturing ndustriesare relocatingfrom older centralcities to suburbsand to otherpartsthe country).Between 1990 and 2000, over one million white, non-Hispanic residentsmoved out of the nation's five largestcities, and the non-white percentageof thepopulation in these cities decreased from 52% to 44%. CTR. ON URBANAND METRO.POLICY,Brookings Inst., Racial Change in the Nation's Largest Cities: Evidence from the 2000Census, at http^/www.brook.edu/dybdocroot/es/urban/census/citygrowth.htmApr.2001).4. From 1960 to 1980, the black male populationnearlydoubledfrom 5.6 million to 10.7 million,but the number of employedblack men increasedfrom4.15 million to only 5.94 million, adding 3.5million men to the ranks of the unemployed.LESLIEW. Dunbar, MINORITYEPORT:WHATHasHappened to Blacks, Hispanics, and the American Indians, and Other Minorities in theEighties 41 (1984).5. See WILSON,upra note 3, at 22 (assertingthat blacks only constitute13%of the population ncities but account for half of all arrests for violent crime) (citing U.S. Dep't OFJUSTICE,NIFORMCrime Reports for the United States, 1984 (1985)).6. For example, although gentrified neighborhoodsin Minneapolis increased in value between1988 and 1993, buildings in ghetto neighborhoods ost one-fifth theirvalue, while the value of build-ings in transitionalareas decreasedby 10%.See Myron Orfield, Metropolitics 63 (1997).

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    Yale Law& PolicyReview Vol. 20:353,2002areas.This reductionof servicesmade conditions n the innercitiesworse,en-couraging ven moreresidents o leave,thusperpetuatinghecycle of decline.The fact that white middle-classcitizens often moved to more automobile-dependent,ow-densitycommunities longthe ruralperiphery r fringeareasfurthersolatedpoorer, acially-diverseommunities.One of theprimary ausesof the mass exodusthat ed to center-city eclineis the marketplace istortion ausedby county,state,andfederalgovernmentinvestments hatencouragedevelopment f "fringe" reasoutsideof innercit-ies.8Althoughmassive shifts in the economicorganization f regionalecono-mies aresignificant actors n the decline of centercities,9 hese massive stateand federalsubsidiesand investmentsn infrastructuresuchas roads,sewers,andwaterlines)havegreatlyaidedthe flightfromurbancentersand oldersub-urbs,and intensified nequalities.10hese subsidiesand investments end tobenefitwealthiercitizenswho can afford to move to the outlyingcommuni-ties,11and help draw businesses andjobs away from centercities and innersuburbs, isproportionatelympactingminorities.12One recentstudy rom heUniversity f IllinoisatChicago ound hatwhilethe Chicagourbanareareceivedmoregovernmental xpenditures riented o-wardconsumption,13ommunitiesn outlyingsuburbs eceived arger evels ofwealth-buildingssistance elated o infrastructurendhousing.14 lthough hestudyfound that the outersuburbsactuallyreceived ess per capitafederalex-penditureshanthe urbanized rea($2744 versus$5350), it also foundthatthesuburbsbenefittedmore froma higher evel of assistancerelated o capitalac-cumulatione.g., housing,roads,publictransit).15hiscapital-basedssistance

    1. Id.8. These new outlyingcommunities end to be built on naturalhabitatsor greenfields.Ctr. for Wa-tershedProt.,TheEconomicsof UrbanSprawl,2 WATER ROT. ECHS.61, 461 (1997).9. Regions are shifting fromgoods-producing o service-producing conomies. Manufacturingn-dustries have relocated from center cities to the suburbs,which has "been especially devastatingforlow-income blacks and other minorities because these groupsare concentrated n the centralareasthathave been hardesthit by economic dislocation."WILSON,upra note 3, at 12110. Kaid Benfield et al., Nat. Res. Def. Council, Once There Were Greenfields 106(1999).1 1 John Powell, AddressingRegional Dilemmas or MinorityCommunities, n REFLECTIONSNRegionalism 218, 228 (Bruce Katz ed., 2000) (discussing the hypothesis that while the wealthiestwhites benefit fromsprawl,poorerwhites do not).12. WILSON,upra note 3, at 121 (documentingthe disproportionatempact of central city joblosses on minorities).13. Consumption-based governmental assistance includes medical assistance, redistributionalgrants,food stamps, unemployment,and SupplementalSocial Security,while wealth-accumulating s-sistanceconsists of highway grants,public transit,otherinfrastructure,ncometax subsidyfor housing,environment assistance, and disaster relief. Joseph Persky & Haydar Kurban, BrookingsInst., Do Federal Funds Better Support Cities or Suburbs?: A Spatial Analysis of FederalSpending in the Chicago Metropolis 7 (2001), available athttp://www.brook.edu/dybdocroot/es/urban/publications/persky.pdflastreferencesApr. 15, 2002).14. See id.15. The tax subsidy for housing was shown to contribute to the largest disparitybetween centercities and outlying suburbs. "A suburban amily of four receives about $2,200 per year while a cityfamily of four receives about $500. . . . The richest third of municipalitieshave an average subsidy of

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    IncludingDisadvantaged ommunitiesn SmartGrowthreducesthe cost of greenfielddevelopment,helps fuel inequalitiesof wealth,and ndirectlyubsidizes heflow of residentsandbusinesses urther wayfromthe centercities.This increases nequalitiesandpotentially uels the need formoregovernmentransfers.Governmentnvestments nd subsidiesaddgreatvalue to outerringcom-munitieswhile inner cities stagnate.According o the NaturalResourcesDe-fenseCouncil, prawlingdevelopmentarelygenerates ufficientrevenues romtaxes andtraditionalees to coverthe cost of providing ervices,whichmeansthattheremainingaxpayers fromoutside heseareas)and users of infrastruc-turehaveto coverthese unmet nfrastructureosts.16Thus,theinfrastructurefnew outlyingdevelopments repaid for by taxes and fees levied on residentsand businesses n olderpartsof the city.17This obviouslyreduces he chancesfordisadvantagedroups o obtain ocioeconomic quity.Government oliciesregardingutilityrates can also exacerbate ocial ine-qualities.Providingutilityservices o poor,inner-city esidents s oftencheaperthanprovidingt to residentsof outlyingcommunities, ecausepeoplein thoseareas ive farther wayfromeach otherand so require he creationandmainte-nanceof moreinfrastructure.onetheless, he government ften requires haturban ndnon-urbanesidentspaythesamerates or utilities.18In this Article,I arguethatthe government'spast focus on largelywhite,suburban reas n its investments ndinfrastructurendhousingsubsidiesnotonly had a disparatempacton urbanandinnersuburban19ommunities,20utalso led to environmentally-damagingutcomesand fiscal decline. By ex-pandingherangeof SmartGrowthprograms,we canfurther hecause of civilrightswhilepromotingnvironmentalustice.PartI explains hediscriminatoryimpactof the government'surrentundingprioritiesordevelopment, s wellas theirnegative mpact or the environment. artII introduceshe conceptof"SmartGrowth," ndexplainswhyfundingpriorities hould ncreasinglyocuson SmartGrowth actors.Thispolicyshiftwill notonlycounterenvironmentaldegradation,raceable o distortedncentiveschemesthatencourageenviron-mentallyharmfuldevelopment,but also be more equitable o disadvantagedalmost$4000 per familyof four."Id. at 15. Since the landsupplyfor sprawlinghomes is bountiful,thistax subsidyreducesthe real cost of acquisitionand results in savings for sprawlinghomeowners.Forcenter-cityresidents, he tax does not resultin an equallevel of savingsperbenefit dollar.See id.16. See BENFIELDTAL., upra note 10, at 106.17. See Myron Orfield, Metropolitics: A Regional Agenda for Community andStability 63 (1997).18. See, e.g., Michael L. Siegel, The Effects of Land Use on Utility Service Costs, andGeographically-Sensitive User Rates 3 (1998) ("Lackof density and economy of scale variables"mean that a "ClevelandDivision of Water(CDOW) rate structure ikely exacerbatesregional incomedisparities,as it can cause communitieswith lowerper capita incomes andhigher povertyratesto sub-sidize serviceto those withhigherincomesand lowerpovertyrates.").19. An "innersuburb"or "inner suburbancommunity" s a communityclose to center city. SeeOrfield, supranote 17 at 2120. See id. at 63.

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    Yale Law& PolicyReview Vol. 20:353,2002groupsandpeopleof color.Part Ialsoexplores hedegree o which the currentframework f statutesandexecutive orders s amenable o the implementationof SmartGrowthprinciples.Part III examinesspecific ways in which theseprinciples an be implemented. art Vconcludes.Improvinghe social welfareof citizens of disadvantagedommunities e-quiresmore thanformalcivil rights protections it requiresa nuts and boltsstrategyof tackling broader and entrenchedenvironmentaland economicproblems.These issues must be addressedn federaland stateappropriationscommittees,countyand metropolitan lanningboards,local and state taxingand financeauthorities, conomicdevelopmentand planningoffices, publicworksdistricts,and other entities that have been directing he flow of invest-mentsand other financialresourcesoutside of decliningmetropolitanommu-nities.

    I.The Detrimental Consequences of State and Federal FundingPolicies for Development on the Environment and the Poor.InthisPart,I reviewandcritique heapproacho development undingcur-rently employedby the federalgovernmentand manystates. SectionA dis-cusses howextantpolicieshaveled to inequitieshatharm acialminorities ndthepoor.Section describeshow thesepoliciesharm heenvironment s well.

    A. Development undingand thePoorThe mantraagainstcentralcities and olderdecliningareas s thattheyaredependenton government ubsidies. This assertion gnoresthe government'songoingrole in avertingresourcesaway fromcities and declining neighbor-hoods in favor of more affluentsuburbs. n this Section,I focus on fourtypesof governmentprograms mortgagesubsidiesand insurance,ax deductions,transportationubsidies,and infrastructureubsidies to demonstrate owtheyhave had a discriminatorympactagainst ow-income nner-city/inner-suburbangroups.1 MortgageSubsidiesandInsuranceThe federalgovernmenthas played a significantrole in financingmort-gages, to the disadvantage f older,poorer, ethnicallydiverse communities.Theincreased vailability f mortgageshas ledto a greaterdemand orhousingoutside of urbanareas,drawing amiliesawayfromexistingcommunities nderodingcities' taxbases.21Between 1933and 1935,thegovernment-runome

    2 1 "Ofthose living in concentratedpoverty,more than half are black (despitethe fact that blacksmakeup only 12 percentof the nationalpopulation)and one-fourthareHispanic."Powell, supra note11, at 224. Most telling in terms of a declining tax base is that "between 1970 and 1990, there was a69.7% increasein the numberof blacks in neighborhoodsof concentratedpoverty, despite the fact that356

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    Including Disadvantaged Communities in Smart GrowthOwner Loan Corporation (HOLC) supplied over $3 billion for more than amillion mortgages or loans, a large proportion of which was for owner-occupied housing.22These funds were provided in such a way as to facilitate outward expan-sion, away from inner cities. The Federal Housing Administration (FHA) di-rectly influenced the exodus from cities to the suburbsby grading communitieswithin or neardeclining areas as uninsurable. HOLC devised an appraisalproc-ess that "undervaluedneighborhoods that were dense, mixed-use or aging."23This process excluded neighborhoods with large Jewish populations, and gaveblack communities the lowest grade. As a result of this biased appraisal proc-ess, private sector loans were disproportionatelychanneled to white, suburbanareas.24Another FHA policy that discriminatedagainst inner city minorities focusedon enabling families to purchasesingle-family homes. The FHA did not financemixed-use or multi-unit housing, which are the most typical forms of housingin center cities. Between 1936 and 1972, FHA had helped nearly eleven millionfamilies buy homes, yet it insured only 1.8 million multi-family projects.25Moreover, FHA loans for home repair were insufficient to support rehabilita-tion of existing properties.26As a result, FHA insurance tended to go to newresidential developments on the edges of metropolitanareas, to the neglect ofcity cores. Perhapsmost disturbingly, in an attemptto preserve propertymarketvalues, FHA recommended in its underwritingmanual the inclusion of restric-tive covenants in deeds to exclude resale to minorities.

    2. TeaDeductionsAllowing families to deduct the amount of their local propertytaxes fromtheir taxable income effectively provides wealthy communities with a greater

    subsidy for financing local services, such as education, than poorer communi-ties receive.28The tax deductions also create non-market influences over con-sumers by dramaticallyreducing the cost of homeownership relative to apart-ment living. Brownfields redevelopments, which are often amenable to mixed-use developments, arepotentiallyharmedby this tax system bias.the national poverty rate for African Americans was the lowest ever." This suggests severe impacts fromsprawl increasing social and economic isolation. Id.22. Kenneth Jackson, Crabgrass Frontier: The Suburbanization of the United States196-98(1985).

    23. Id. at 197.24. Id. at 197-98; Powell, supra note 11, at 224 ("[T]he loan corporation (HOLC) channeled mort-

    gage funds to white, outlying neighborhoods.").25. See JACKSON,upra note 22, at 205.26. Id at 205-06.27. JACKSON,upra note 22, at 208-09 (on the use of restrictive covenants); Powell, supra note 11,at 224.28. See I.R.C. 25(a)-(b) (1994).

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    Yale Law& PolicyReview Vol. 20:353,2002The federalgovernment lso allows homeowners o deductmortgagepay-ments from their taxable ncome.29The combinedpropertyax andmortgageinterestdeduction,accordingto Federal Reserve Bank economist RichardVoith,decreases he after-tax ost of housing by 15%and,moreimportantly,reducesresidentialdensity,on average,by 15%.30 his meansthatthe tax in-tensifies the preferencefor large-lot low-densitydevelopments, herebyin-creasingpressure n metropolitanprawl.Until 1997,the taxcode also gave homeowners ignificant inancialdisin-centivesregardingheproceedsof the sale of theirhomes.31Theonly way forhomeowners o rollover he capitalgainsfrom the sale of their homeswas topurchasea newer, larger,and more expensivehome, often in the suburbs.32

    This tended to diminishdemandfor existing properties,nfill developments,and rehabilitatedower-costhousingin older inner suburbsor center cities.33The 1997 TaxRelief Act removed hiscapitalgainsrolloverprovision.343. TransportationubsidiesTheover-emphasisn fundinghighwayconstruction as reducedaccess tojob opportunitiesor our most vulnerableandpoor citizens. In a twenty-yearspan,$1 trillionwas invested n a vastsystemof highways; uburbs eceivedamuch greatershare of highway fundingthan cities.35The FederalHighway

    Administration's ommittee n Oversightof State-ReportedMotorFuelData,which met May 2001, concluded,"Intotal, about$12 billion in Federal-aidfundsare distributed asedon motor uel data."36Highwayconstructions a hiddensubsidy o motorists, ncouragingongercommutesand more auto-dependentommunities.Althoughuser fees (tolls)are oftencharged,accordingo most studies heyare insufficient o cover con-struction ndmaintenance osts.37More roadconstructionmeans more devel-

    29. Seel.R.C. 163(a) (1994).30. RichardVoith, Does the Federal TaxTreatment f HousingAffectthe Patternof MetropolitanDevelopment?,BUS.R., Mar./Apr.1999, at 10.31. &*I.R.C. 1034(1994).32. Envtl L. Inst., Linking Tax Law and Sustainable Urban Development: The TaxPayer Relief Act of 1997, 7-9 (1998).33. id. at , l.34. Seel.R.C. 121 (1994).35. UrbanSprawl:Not Quitethe MonsterTheyCall It, ECONOMIST,ug. 21,1 999, at 25.36. Office of Highway Policy Info,U.S. Dep't of Trans.,FHWA Committeeon Oversightof State-Reported Fuel Data Met In May, HIGHWAY NFO.Q., June 2001, at 1, available at

    http://www.fhwa.dot.gov/ohim/hiqjun01.htmlastvisitedApr.2, 2002).37. Benfield et al., supra note 10, at 110 ("ImpactFees do not cover manyof the costs imposedby sprawl;" hey "cannotbe used to cover the staggeringcosts of maintenanceandrepairing he existinginfrastructure.");ee also Nelson Arthur & Duncan James, Growth Management Principlesand Practices 122 (1995) ("Impact ees have been used to finance a varietyof public services" in-cluding " water,wastewater,roads,parks,fire, protection, aw enforcement,beach, electricpower, . . .[and] stormwater.").358

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    IncludingDisadvantaged ommunitiesn SmartGrowthopment,which further ncreases he demand or roads;38t is a cycle thaten-sures that the government's ttentionand resourcesarecontinuouslydivertedawayfrom nnercities.Indeed, undsused for roadsare fundsthataredivertedaway from inner suburbsand center cities. In addition, ncreasedemissionscausedby increasingrends n vehicle miles traveled VMT)or increased ehi-cle trips VT)could threaten o reduce uturebenefits rom he CleanAir Act.39

    4. InfrastructureubsidiesGovernmentundingfor sewers,parks,and schools influencesprivate n-vestmentdecisions.Grantprograms ndrevolving oanfunds40upportinghedevelopmentof new water and sewer facilities influenceprivatereal-estatemarkets owardex-urbandevelopment.For example, federal investments nwastewater ystemsfrom1972 to 1990 totaledmorethan$60 billion.41A re-cent estimate s thatthe combined ederal, tate,and local contributionsotaled$250 billionsince 1970.42Again,thesefundsare availableprimarilyor build-ing new infrastructureather han for operation r maintenance f existingin-frastructure. his encouragesgrowthaway from under-utilized roperties ndisadvantagedommunitieswith abandoned ropertieshathavepotential nvi-ronmentaliabilities.By supporting rowthalongthe outlyingor underdevel-oped periphery reas of metropolitan egions, sprawland urbandeclinecon-

    tinue.Suchgrowthpatternsendto be veryinefficient.For example, energy effi-ciency obtained romdistrictnetworksof heat, cooling, and co-generationsbetter ervedby clusteredor moredenselypopulatedurbandevelopment43han38. DonaldT. Chen,If YouBuildIt, TheyWill Come: WhyWe Can7 Build OurselvesOutof Con-gestion, PROGRESS, ar. 1998, at 4, available at http://www.transact.org/Progress/mar98/build.htm(lastreferencedApr. 15, 2002).39. EPA,Our Built and Natural Environments: A Technical Review of the InteractionsBetween Land Use, Transportation, and Environmental Quality 26 (2001).40. See, e.g., 33 U.S.C. 1301 (1994) (establishinga revolving loan fund for sewer treatment a-cilities).41. Nikos D. Singelis, FinancingPriorityWatershedProjectswith the StateRevolvingFund(June8, 1996), available at http://www.epa.gOv/O OW/watershed/Proceed/singelis.htmllast visited Apr. 1,2002).42. Congress has appropriated approximately $100 billion to EPA to provide fundingthrough the Construction Grants program, Clean Water State Revolving Loan Funds (SRFs), andother programs. State and local governments have contributed the remaining $150 billion, pri-marily from revenues received from local ratepayers.See Staff of House Subcomm. on WaterRes. and Env't, 107th Cong., Water Infrastructure Needs (2001), available athttp://www.house.gov/transportation/water/03-28-003-28-0 1memo.html#BACKGROUND (last vis-itedApr. 1,2002).43. Districtenergysystemsdistribute team,hot water,and sometimeschilled water froma centralplantto individualbuildingsthrougha networkof pipes. "Inhigh-densityareas,districtenergyis usu-ally more economical and energy-efficientthan individual heating and cooling systems. . .especially

    when district energy plants include combined heat and power." These systemsachieve energy efficiencies of 60 to 90 percent, which emits less greenhousegas emissions. State and Local Climate Change Program, EPA, ClimateChange Technologies: Combined Heat and Power (Jan. 2000), available at359

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    Yale Law & Policy Review Vol. 20:353, 2002other forms, such as sprawling, low-density development. Sprawling develop-ment patterns require expensive investments in sewer, water, and road exten-44sions.

    In addition to being inefficient and drainingresources that would otherwisebe available to inner cities, low-density developments actually deprive poordisadvantaged groups of their limited financial resources through cross-subsidization, or "averagecost pricing."As noted earlier, all customers pay av-erage costs, which means that total costs are divided equally among service re-cipient regardlessof the marginalor incremental cost of providing the service.45Residents in more urban,higher-densityareas subsidize those on the fringe un-der this arrangement.A recent Florida study of utility costs by developmenttype found that it may cost more than twice as much to service utilities in low-density developments.46

    . Development Funding and the EnvironmentPoorly-planned sprawl development affects not only the poor, but alsomany aspects of environmental quality. For instance, sprawl can have severeeffects on water quality. When watershed development exceeds 10 to 15%"impervious cover,"47 it is extremely difficult to maintain pre-developmentstreamquality. According to data from the National WaterQuality Inventory:48

    38% of assessed estuary miles are impaired49 rom meeting beneficialuses, with 46% of this impairmentattributable o urban runoff36% of river miles are impaired,with 12%affected by urban runoff39% of lake acres are impaired,with 21% of the impairmentcaused byurban runoff13% of assessed ocean shorelines are impaired, with 55% of the im-pairmentdue to urbanrunoff throughstorm sewers50

    http://www.epa.gov/globalwarming/publications/outreach/technology/combinedheatandpower.pdflastvisitedApr. 1,2002).44. Siegel, supra note 18, at 14-16.45. Arthur & James, supranote 37, at 1 13.46. Siegel, supra note 18, at 1 3.47. "Imperious over" ncludespavement,roofs, androads,and allows pollutedwater from run-offinto streams;it can also increase water temperature.See The Importanceof Imperviousness,in THEPractice of Watershed Protection 9 (Thomas R. Schueler & Heather K. Holland eds., 2000),available at http://www.stormwatercenter.net/Practice/l-importance%20of%20Imperviousness.pdflastvisitedApr. 1,2002).48. To assess waterquality,states and otherjurisdictions compare monitoringresults to the waterqualitystandards hat have been set for their waters.Section 305(b) of the Clean WaterAct establishesthe WaterQualityInventoryReport,which contains information rom each state on the qualityof rivers,lakes,wetlands, estuaries,coastalwaters,andgroundwater.See Office of Water, EPA,The Qualityof Our Nation's Water, available at http://www.epa.gov/owow/305b lastvisitedApr. 1, 2002).49. For an explanation of the causes of water contaminationand impairment,see OFFICE FWater, EPA, 1998 Section 303(d) List Fact Sheet: National Picture of Impaired Waters,available at http://www.epa.gov/owow/tmdl/states/national.htmllast visitedApr. 1, 2002).50. EPA, supra note 39, at 14-15. The Clean WaterAct, 33 U.S.C. 1251(a), addresses mpaired

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    IncludingDisadvantaged ommunitiesn SmartGrowthStormwaterunoffcosts the commercial ish industry$17-31 million per

    year in environmental amageto adjoiningcommunities.Pollution of watersuppliesinduced the New York City's Catskill DelawareSystem to spend$4.57 billion on a new filtration ystemthat will increasedrinkingwater billsby45%.51Development lso has adverseeffects on the atmosphere,argelydue to in-creasedautomobile missions;emissionsfrom ncreasedvehicle miles traveled(VMT)contribute reatly o airpollutionnationwide nd are theprimaryauseof airpollution n manyurbanareas.Sprawl-inducedutomobiledependencyhas also increased missionsof severalharmful ases.52Transportationourcesemit 56%of U.S. emissionsof nitrogenoxide, 77%of carbonmonoxide,47%of the violatileorganiccompounds,and 25%of particulatematter.53Mobilesourcesalso produceseveralotherimportant ir pollutants, uch as carcino-genic air toxics and greenhousegases.54The estimatedannual costs of thismotorvehicle-basedpollutionarehuge, ranging romunder$30 billionto over$500billionin increasedhealthcarecosts, $2.5 to $4.6 billionin crop damage,and$6.0 to $43.54billionindamage o visibility.55Otherdamages romsprawl ncludebreakinguporfragmentingtretches fpristinehabitatsandwildlife and reductionsn the abundance nddiversityofbird species.56Researchershave foundthat smartgrowthdevelopment,dis-cussedlater n this article,57 ouldreduceconsumption f fragilelandsby al-most one-fifth.58 ccording o CongressionalTestimonyby the formerActingAssistantAdministratorf theEPA:

    97 million people live in areasthatdo not meet the health based 1 hourozone stan-dardaccordingto 1997 to 1999 data. Reducing ozone levels will result in fewer

    waters.The objective of this section is to "restoreand maintainthe chemical, physical, and biologicalintegrityof the Nation's waters [W]hereverattainable,an interimgoal of waterqualitywhich pro-vides for the protectionand propagationof fish, shellfish, and wildlife and provides for recreation nand on the waterbe achievedby July 1, 1983."Id.51. George Aponte Clark& Nancy Stoner,StormwaterStrategies: The Economic Advantage, 2STORMWATER0, 11 (2001), available at http //www.forester.net/sw_00 _stormwater.html(lastvisited Mar. 1,2002).52. These gases include carbonmonoxide,nitrogenmonoxide, nitrogendioxide, ozone, sulfurdi-oxide, precursors o ozone, volatile organiccompounds,and nitrogen.The amount of harmfulparticu-latematter n the atmospherealso increasesas a result.EPA,supra note 39, at 25.53. HearingBefore the Senate Comm. on the Env't and Pub. Works, 107th Cong. (2001) (testi-mony of Robert Brenner, Acting Assistant Administrator, EPA), available athttp://www.senate.gov/~epw/brenner0801.tm(last visitedApr. 14, 2002).54. Id. at 28.55. Id. at 29.56. EPA,supranote 39, at 29.57. See discussion infraPartII.58. Robert W. Burchell & David Listokin, Land, Infrastructure, Housing Costs andFiscal Impacts Associated with Growth 9 (1996); see also The EndangeredSpecies Act, 16 U.S.C. 1531 (1994) (recognizingthat variousspecies offish, wildlife, and plants in the United States havebeen renderedextinct as a consequenceof economic growthand developmentuntemperedby adequateconcernandconservation).

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    YaleLaw& PolicyReview Vol. 20:353,2002hospitalizations, emergency room and doctors visits for asthmatics, significantlyfewer incidents of lung inflammation for at risk populations, and significant fewerof moderate to severe respiratory symptoms in children.Given the harmfulsocial and environmental ffects of unlimitedsprawl,governmentunding houldnotprovide ncentives or it.

    II. The Virtues of Smart GrowthHavingexplored he deleterious ocial and environmentalonsequencesofthe government's urrentpolicies towardgrowthand development,his Partexamines he benefits offeredby a SmartGrowthapproacho development.argue hatgovernmentncentiveprograms,n particular vertandhiddensub-

    sidies,shouldbe tailored owardencouraging martGrowthandreducingnon-market ncentives orsprawlanddecreasingdensity.A SmartGrowthpolicyis one builtuponthefollowingprinciples:Offeringa rangeof housingchoicesfor all income evels;Combining ifferent anduses (e.g. commercial ndresidential);Encouragingewgrowth ntoexistingcommunities;Designing communitiesto supportincreasedtransportationhoices(e.g. walking, ransit); ndUtilizingexisting nfrastructure.The fiscal benefits of SmartGrowthpolicies which encourageclustered,compact,or denser mixed-usedevelopmentsare substantial.Under currentsprawl-inducing olicies, capital acilitycosts are60%moreexpensive,schoolfacilities areover 7%higher,and utilities areapproximately0%morecostlythanundera SmartGrowth cenario.61SmartGrowth an be viewed asanattempto helpleveltheplaying ieldbydirecting nvestmentback to the communitiesmost affectedby sprawl com-munitieswhich tendto be of color and with underutilized ropertiesandun-used infrastructureapacity.Due to the departure f businessesfrom urbancenters,the location efficiencies these places have to offer are largely un-tapped.62n fact, benefits fromluring developmentback to cities have beendubbed he "urban ompetitive" dvantage.63 ne studyfoundthat innercitycommunities, meresubsetof urbanor centercityareas,have an unmetmarket

    59. TheImpact of Air Emissions rom the TransportationSector on Public Health and the Envi-ronment:Hearing Before the Senate Comm.on the Env't, 107thCong. 406 (2001) (statementof RobertBrenner,ActingAssistantAdministrator,EPA).60. See SmartGrowthNetwork,Principles of SmartGrowth,athttp://www.smartgrowth.org/about/principles/defaultlast visited Mar. 1, 2002).61. Robert W. Burchell & Naveed A. Shad, The Costs of Sprawl Versus CompactDevelopment 12 (1998).62. Michael E. Porter,TheCompetitiveAdvantageof the Inner City,Harv. Bus. Rev., May-June1995, at 55, 55.63. Id. at 56.362

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    IncludingDisadvantaged ommunitiesn SmartGrowthpotentialof $85billiondollars.64 rom1995 to 2020, Florida ouldenjoy$6.15billion in individualand government avings by fostering compact develop-ment a SmartGrowthpolicy.65 n addition,assets such as a ready supplyofuntappedabor,strategicaccess to key industries ndmarkets,andtransporta-tion makemanyinner cities potentiallypowerfulplaces for businessesto ex-pand.Meanwhile,development longthe fringe whichthreatens reenspace,endangers ensitiveecosystems,and impairswaterquality is becominglessprofitable.66Thispolicy frameworks also extremelycompatiblewith the objectivesofcivil rights. By strengthening xisting communities nstead of encouragingfringedevelopment, rovidinggreater ransitandhousingchoice,andmakingdevelopment ecisionsfair andcost-effective,policies basedon SmartGrowthprincipleswill providegreateropportunitiesor economicand social mobilityto low-incomeanddisadvantagedommunities.Thus,the effects of currentnequitablepracticesandpolices could be re-versedby SmartGrowthpolicies thatdirectresourcesback to underutilizedn-frastructure,vert greenfieldredevelopment, lean up abandoned ndustrialproperties,ndredeveloppoorly-maintainedroperties.Several ederalstatutesand executiveordersrecognizeSmartGrowthprin-ciples.The NationalEnvironmentalolicyAct () of 1969, forexample,requirespublicdisclosureof adverseenvironmentalmpactsof new develop-ments.68The Act's public participation nd disclosurerequirements eflectsmartgrowthand environmentalusticeobjectives.ExecutiveOrder12,898co-ordinatesenvironmentalustice activitiesand strategiesacross manyDepart-mentsand agencies,therebyestablishingenvironmentalustice as a nationalpriority.69he Order ocusesfederalattention n the environmentalndhealthconditionsof minorityand low-incomepopulations.Even Executive Order12,866,the ClintonAdministrationutlinefor cost/benefitevaluationof regu-latoryaction,explicitlyincludesdistributive nd environmentalusticeamong

    64. Boston ConsultingGroup,TheBusiness Casefor PursuingRetail Opportunitiesor the InnerCity 3-5 (June 1998), available at http://www.icic.org/research/pubsandstudies.html(last visitedMar. 1,2002).65. Robert Burchell et al., Eastward Ho! Development Futures: Paths to Growth 210(1998)66. Id.67. See ENVTL . INST.,upra note 32.68. NationalEnvironmentalPolicy Act of 1969 102, 42 U.S.C. 4332 (1994). The statutestates,in part,that for "majorFederalactions significantlyaffecting the qualityof the humanenvironment,"the federalagency must preparea detailed environmental mpactstatement(EIS) that assesses the pro-posed action and alternatives. requiresEISs to be broadin scope, addressingthe full rangeofpotentialeffects of the proposedaction on humanhealthandthe environment.69. Exec. OrderNo. 12898, 3 C.F.R. 59 (1994). The Orderrequiresthat "each Federalagency[unlessexceptedby the President]shall develop an agency-wide environmentalustice strategy . . thatidentifiesandaddressesdisproportionately igh humanhealth or environmental ffects of its programs,policies, oractivitieson minoritypopulationsand low-incomepopulations."

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    Yale Law & Policy Review Vol. 20:353, 2002cognizable "benefits" to society.70Title VI of the Civil Rights Act of 1964 bansthe denial of federal funds or of access to fedearally-funded programs "on theground of race, color, or national origin."71Title VI could also be viewed as aprescription for the implementation of sustainable development practices thatpromise to reduce the disproportionateeffects of damaging sprawl developmenton certain communities. Read in the light of and later regulations, TitleVI implies that the Environmental Protection Agency has a legal basis for in-corporating environmental equity and justice into considerations into its poli-cymaking.

    III. Practical Ways To Implement Smart GrowthThe challenge is to redevelop inner-city communities and reduce the bene-fits of investing in outlying areas, new developments, and suburbancommuni-ties. Several opportunities exist under current law to tap into new sources offunds and to re-engineer financial priorities to achieve a more efficient balancebetween development of the core communities and of outlying fringe areas.

    A. Cleanups Under the BrownfieldsActThe new Brownfields Act provides up to $200 million in programbudget

    authority for assessment, cleanup, and reuse of sites, including sites with pe-troleum contamination.72More importantly,it clarifies legal liability for clean-ups, exempting small contributors, and prospective purchasers or innocentowners and operators from expensive superfundliabilities.73 The U.S. Confer-ence of Mayors projectedthatover one half million jobs will be created,and upto $2.4 billion dollars in additional tax revenues could be generated throughbrownfields redevelopment.74This presents a unique opportunity to increasethe conversion of propertieswith unused development potential to more benefi-cial uses.75 The Brownfields Act represents a substantial opportunityto revi-talize core urban and inner suburbancommunities.

    70. Exec. Order No. 12,866 3 C.F.R. 638 (1993).71. Civil Rights Act of 1964 601, 42 U.S.C. 2000d (1994).72. Brownfields Revitalization and Environmental Restoration Act of 2001 21 1, 42 U.S.C. 9601(2002). The term "brownfield site" means "real property, the expansion, redevelopment, or reuse of whichmay be complicated by the presence or potential presence of a hazardous substance, pollutant, or contami-nant." See also EPA, Benefits of Brownfield Clean-Up, at http://www.epa.gov/swerosps/bf7html-doc/2869ben.htm (last referenced Apr. 14, 2002).73. 42 U.S.C. 9601,9607(2002).74. PressRelease, U.S. Conference of Mayors, City ReportShows Effects of Brownfields in America (Feb. 24,2000), at htty://www.usmayore.or^uscnvheWpress_re^ (last visitedApr.2, 2002).75. U.S. Conf. of Mayors, Major Provisions of H.R. 2869- The Small Business Liability Relief andBrownfields Revitalization Act (2002), at http://www.usmayors.org/uscm/us_mayor_newspaper/documents/01-14-02/brownfields2.asp (last visited Apr. 2, 2002).364

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    IncludingDisadvantaged ommunitiesn SmartGrowthB. ReduceCross-Subsidization

    Therearemanystrategieshatcan be used to prevent ross-subsidizationffringecommunities yurbanareasandcitycores.First,new state,regional,andfederal nvestmentn new infrastructurendinbusinessdevelopmenthouldbesteered o areaswithexistingcapacity.Underutilizednfrastructureepresentswaste to taxpayers nd an onerousburdenon thepoor.Since 1997,the StateofMaryland assuccessfullynstituted sprawl-reductionrogram.76Second,community roupsshouldunderstandhepotentialmplications fthe GeneralAccountingStandardsBoard's(GASB) requirementsor improv-ing financialdisclosureof capitalinvestmentpolicies in their communities.Statement 34, a newrequirementf theGASB,hasa major nfluenceon howgovernmentsaccountfor capitalassets. This revision,which will be imple-mentedby 2003, requires apitalassetmanagement ractices o includeaccrualaccountingand depreciation f futureexpensesof infrastructure.77ecliningcommunitieswill benefitfrom this developmentbecauseit only appliesto in-frastructureuiltafter1980,so onlynewercommunitieswitha largeproportionof new infrastructureill have to depreciate r report he expensesassociatedwith theirassets in a manner hat couldaffecttheircredibilityn capitalmar-kets. This could indeedhelp level the playingfield for regionaldevelopmentpolicies that allow unfettered xpansionof infrastructureo new low densitydevelopments.Third, ederalmortgage ubsidiescouldgive specialpriorityo "location f-ficient mortgages,"which calculatethe amountavailableto be loaned as afunctionof thedegree owhichthe hometo be purchaseds located n a transit-oriented ocationandnot dependenton automobiles.Homes in areasnot re-quiringdependenceon automobiles eave ownerswith more disposablein-come,dueto transportationavings,andhencea greaterabilityto makemort-gagepayments.Fourth, mplicationsof racialsegregationon sprawland losses to disad-vantagedcommunitieshouldbe studied."Housingmarketsdon'tjust distrib-ute educationthey also distributeeducationemployment,safety, insurancerates,services,andwealthin the formof homeequity."78 nd theydeterminethe level of exposure o drugsand crimeandpeer groupsthat one's childrenexperience.Surveyshave also shown that while blacks preferto live withwhites,the reverse s not true.79The damagesfromthe vestiges of past dis-

    76. Md. Dep't of Planning, 200 1 Annual Report at4, at http://www.mdp.state.md.us/annual.pdfHastvisited Aor. 2. 2002).77. Daniel Bajadek, The Public Sector 'Fesses Up: UnderstandingGASB34 's InfrastructutureReporting Requirements, GLOBALREALEST. NOW, Fall 2001 , at 26.78. Douglas S. Massey,AmericanApartheid:Housing Segregation and Persistent UrbanPoverty(1994), at http://www.ssri.niu.edu/dl/massey.htmllast visited Mar.28, 2002).79. Id.

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    Yale Law&PolicyReview Vol. 20:353,2002crimination reatea self-perpetuatingrocessof outwardmoves for whitesandsomenon-whitesawayfrom harshconditions n the innercity a processthatevenupwardly-mobileon-whites an'tbypass.This hasprofoundmplicationson the socialwelfareof minoritygroupsand the environment nd the welfareof theregion hathas to subsidize his outward xodus.DouglassMasseystatesthat he demand orhousing n allwhite areas s strong,but thatonce a blackortwo entersthe neighborhood,white demandbeginsto falterat a rapidrate asthepercentage f blacksincreases. Hopefully,new generations f whites andblacks will be able to experiencenew harmony.Untilthen,effortsto alleviatesevere economicdisparities ausedby this form of rolling segregation houldproceed.Programshataid innercities and makethose areasmoreattractiveowhites includeenterprise ones, transitorienteddevelopmento alleviatethejobs-hosting mbalance,and educationalnitiatives.Efforts to prohibitfiscalzoning or exclusionaryreal-estaterequirements nd efforts to improvefairhousingenforcementwould alleviate barriers o SmartGrowth and achievemoresustainableutcomes.C. Increase nvestmentnExistingCommunities

    A cornerstone f any successful SmartGrowthprogramwould be to in-crease nvestment n existingurbanandcorecitycommunities.1 TransportationfficiencyAct(TEA-21)TheAct appropriates218 billion over six years, n part o fund the devel-opmentof transportationystems consistentwith a cleaner environment ndcommunityrevitalizationgoals.81SmartGrowthand the redevelopmentofabandoned roperties analso be furtheredhrough he TEA-21'sCongestion,Mitigation,andAir QualityImprovementCEMAQ)program.82 EMAQ n-cludesprovisions or funding ransportationontrolmeasures, tormwaterm-provements,ndprivately wned ntercitybus terminals.83he amount f fundsavailable or this programs substantial.For fiscal years2002 and2003, it is$1,407,474,000, and $1,433,996,000 respectively.84ince minoritiesare dis-

    80. Id.81. Transportation quityAct forthe 21st Century,23 U.S.C. 149 (1994); see also U.S. Dep't ofTrans.,TEA-21TransportationEquityActfor the 21st Century:MovingAmericans into the 21st Cen-tury (July 14, 1998), at http:/www.fhwa.dot.eov/tea21/suminfra.htmlastvisited Apr. 3, 2002).82. EPA,TransportationndBrownfields,vailableat http:www.epa.gov/brownfields/swerosps/bfpdftea-21.pdf last visitedApr.3, 2002).83. 23 U.SC. 149 (1994) ("AStatemay obligatefundsapportionedo it undersection 104(b)(2)forthecongestionmitigationandairquality mprovement rogram nly for a transportationrojectorprogramif the projector programs for an area in the Statethatis or was designatedas a nonattainment rea forozone,carbonmonoxide,orparticulatematterunder he CleanAirAct.")(internal itationomitted).84. U.S. Dep't of Trans.,TheCongestion Mitigationand Air Quality Improvement CMAQ)Pro-gram Under the TransportationEquityActfor the 21st Centruy(TEA-21):ProgramGuidance Memo-randum5 (Apr., 1999), at http://www.fhwa.dot.gov/environment/cmaq99gd.pdflast referencedApr.366

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    IncludingDisadvantaged ommunitiesn SmartGrowthproportionatelyepresentedn non-attainmentegions,85 nd these funds aregearedto improveair quality improvements, isadvantaged ommunitiesareeligibleto benefit from thesefunds,which canredistributeapitalback to de-cliningcommunities.In addition o CMAQ,TEA-21createsa new programor Job Access andReverse CommuteGrantsfor 1999-2003 with $400 million availablefromTEA-21. This programdevelopstransportationervicesdesignedto transportwelfarerecipients nd low-income ndividuals o and from obs, and it developstransportationervicesfor residentsof urban o suburbanmployment pportu-nities.86

    2. BrownfieldsTaxIncentivesOtherprogramso improve he developmentpotentialof existingcommu-nities include the Brownfieldstax incentive,which allows environmentalcleanupcosts to be fully deductiblen the year they are incurred, ather hanhaving o phase n tax benefitsovera longerperiodsof time.87Thegovernmentestimates hat while the tax incentivecosts approximately300 millionin an-nualtax revenue, he tax incentive s expectedto leverage$3.4 billionin pri-vateinvestment nd return8000 brownfieldso productive se.88Smartgrowthenthusiastsouldtweak theseincentives ortransitorientedand mixed-usede-signsto improveoverallenvironmentalndeconomicoutcomes.

    3. Low-IncomeHousingTaxCreditsLow-IncomeHousingTaxCreditsofferyet another et of tools to supporttheequitabledevelopment f existingcommunities.The Low-IncomeHousingTax Credit mproves he supplyof affordablehousingby providing ax incen-tivesto increaseaffordableentalunits.It is a tool thatcanaddress oncernsof

    gentrificationf popularurbanneighborhoods.t was first createdby the TaxReformAct of 1986,andit authorizedax credits n the amountof $1.25 percapitafor each state. The authorizedax creditswere increased ast year by40%.89 hetax creditprograms one meansof directingprivate apital owards15,2002).85. EPA, Reducing Risks For All Communities Volume 2: Supporting Document, athttp //www.q)a.gov/cgi-bin/claritgw?op-display&document==clserv:epa-cinq1355;&rank=4&template=epa(June1992)(noting hatapproximately2%of whites,62%of blacks,and 71% of Hispanicsreside n areasof non-attainmentf theCleanAirAct standards orozoneaccording o thisreport).86. See 23 U.S.C. 149(b)(1994).87. TaxpayerRelief Act of 1997 941, 26 U.S.C. 198 (Supp. 2001) ("Ingenerala taxpayermayelect to treatany qualifiedenvironmental emediationexpenditurewhich is paid or incurredby the tax-payeras an expense which is not chargeableto capital account. Any expenditurewhich is so treatedshallbe allowedas a deductionforthe taxableyear.").88. Office of Solid Waste and Emergncy Response, EPA, BrownfieldsTax Incentive (2001), athttp://www.epa.gov/werosps/bf/bftaxinc.htmlastreferencedApr. 15, 2002).89. National Low Income Housing Coalition, 2001 Advocate 's Guide to Housing and Com-

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    Yale Law& PolicyReview Vol. 20:353,2002thecreationof affordable entalhousing.Statescouldenacta newpolicyto di-rectthese tax credits o compactandtransitorienteddevelopments. incefast-growingareashave a lack of affordable ousingbut haveample obs, a targetedlow-income ax creditspolicy couldsupportan improvedhousing-to-jobs al-ance andprovidegreater fficiencies forbusinesseswho need an available a-borpool.

    IV. ConclusionSynergiesexist betweenSmartGrowthand environmentalustice. Sprawl-ing low-densityand uses areinconsistentwitha clean environment ndan ef-ficienteconomywhereinvestmentdecisions are not influencedby subsidies.The statusquo is not the outcome of an efficient free marketprocess,but aheavily-subsidized rocessthatpromotes ncreasedphysicaldivision betweenpeople of differentraces and classes while devouringnaturalresourcesat apace outstripping opulationgrowth.Greenspaces are lost and massive in-vestments flow toward new infrastructuren exclusive outlyingareas ratherthan o existingcommunitieswithunusedcapacities.SmartGrowth, f it includes ow income anddisadvantagedommunities,will ensure hathousing,employment, ndtransportationhoices are beneficialto the environment,s well as to poor peopleand minorities.Thechallenge s

    to get federal, local, and state offices to deliberateon the best strategies ostrengthen lder towns and communitiesand improve he environment.Thismayentailusingfederal unds,taxcredits,and bondcapacities.TitleVI of theCivilRightsAct gives disadvantaged eoplea tool to makegovernmentsmoreresponsive o theirconcerns.90ecausepeopleof color andlow-incomegroupsgenerally ive in coreareasthat aremore conducive o environmentally-sounddevelopment ractices,ncludingcompactand mixed-usedevelopment,he ra-tionaleto include hesecommunities n a SmartGrowth rameworks compel-ling. Members of center-cityorganizationsand environmental roupshavesimilar nterestsn encouraging martGrowthoutcomes.One collaborative rganization,Policy Link,is an excellentexampleof acommunitydevelopment rganizationackling he problemof regionalequity.Itadvocates argetingpublicfunding or infrastructure,ransportationystems,educationand brownfieldsredevelopment, nd services to supportequitableoutcomesfor areasaffectedby disinvestments.Throughorganizationsuch asthis, environmental ndcivil rightsactivists canjoin forces to promotesocialjusticewhilesavingtheenvironment.

    munity Development Policy - National Low Income Housing Tax Credit (LIHTC), athttp://www.nlihc.org/advocates/lihtc.htm (last visited Apr. 14, 2002).90. See 42 U.S.C. 2000d (1994). ("No person in the United States shall, on the groundof race,color,or nationalorigin,be excluded fromparticipation n, be denied the benefitsof, or be subjected odiscriminationunderany programoractivityreceivingfederal financialassistance.").368