Newark and Its Gateway Complex
By Thomas Dolan

Newark and Its Gateway Complex

Part 2: Old Newark, New Newark

In the 1969 issue of Newark! magazine, the Greater Newark Chamber of Commerce took out a curious advertisement that contained a provocative and disturbing image. The photograph in the ad is of an obese and presumably dead rat hanging by its curled tail from a bent, rusted nail. The caption, in bold print, reads: "No, we haven't finished building the 'New Newark' yet ... but we're working on it." This bold advertisement at first seems like a parody of the seemingly endless claims to rebuild and revitalize Newark, but in all likelihood the ad was not intended as a joke.

The primary job of Newark's Chamber of Commerce was to get people to invest in the city. What that extreme message demonstrates is just how dire the situation was in Newark in the late '60s, so soon after the riots of 1967 wrought 26 deaths and $10 million in damage. To be sure, there were other advertisements in the magazine, also sponsored by the Newark Chamber of Commerce, that were not so negative or extreme. They contained images of the "New Newark," new buildings being built in the downtown area and new project proposals. But the images focused only on new construction, as though nothing old was of value. The lasting image of the "old" Newark that the Chamber of Commerce presented was a dead rat hanging on a nail.

At the time ground was broken on the Gateway project in 1968, Newark was still recovering from the devastating riots of the previous year. Even prior to the riots, Newark was on a steady decline as residents began to leave the city.

"White flight" from Newark to the suburbs, which started in the '40s and accelerated in the '60s, meant that an increasing number of people who worked in the city no longer lived there. Between 1960 and 1970, Newark experienced a 6.6 percent drop in population (26,998 residents) while the surrounding region's population increased by 14 percent. The majority of people leaving the city were white. Between 1960 and 1967, a net total of more than 70,000 white residents moved out of the city. It was during this time that the city went from 65 percent white to 52 percent black and 10 percent Puerto Rican. Federal policies were integral to this change.

Prior to the 1950s, most Americans lived in cities. Several government programs, however, enacted by the federal government after World War II, changed urban environments all over the United States. All of Newark's problems in the '60s—white flight, decreasing tax base, blight, highway construction—can be traced to these postwar developments.

The first development was the creation of large-scale suburban housing outside the city, made possible by federal government subsidies. Loans insured by the Federal Housing Administration (FHA) enabled the construction and financing of new suburban housing communities. Many of the residents of these communities obtained home mortgages for these new houses with help from the Veterans Administration (VA). The VA was established in 1944 to reintegrate the returning veterans of WWII into American society and gave them 100 percent home mortgages with a 4 percent interest, which encouraged many white Americans to move out of the city and into the suburbs.

The policies of the FHA excluded African Americans from obtaining loans. Not only was it against lending in integrated or African American areas, it was also biased against older cities. The FHA would only insure loans for houses that were new, set back a certain number of feet from the sidewalk and separated from adjacent houses. Such houses were not likely to be found in Newark. They were found instead, in the suburbs.

A national highway system, started during WWII and expanded with the Highway Act of 1956, facilitated white flight. It consisted of a primary system and a secondary system. The federal government funded 90 percent of construction of the primary system, called the National System of Interstate and Defense Highways, and 50 percent of the costs of the secondary system. The state funded the remaining costs of both the primary and secondary systems. The ultimate goal was to create 41,000 miles of highway by 1969.

The government proposed such a plan without much consideration for urban environments, however. Eager to expedite the program and in some cases anxious to collect federal money, city planners sacrificed large tracts of urban land, many of which contained residential housing, for new highway construction. Many city dwellers were displaced, and the fabric of many communities was destroyed.

Started in the '60s and completed in the early '70s, Route 280 and Route 78 cut through Newark's residential neighborhoods of Roseville and Weequahic. For Route 78 alone, almost 2,000 housing units were demolished.

With these federal programs, the demographics of American cities began to change. Northern cities were becoming increasingly black as large numbers of African Americans left the rural South for the North. White residents, aided by the federal government, left the city for the suburbs—leaving many houses and buildings abandoned. African-American residents were left to deal with these developing slum areas.

City governments, unable to collect taxes on the abandoned properties, faced funding problems. The Housing Acts of 1949 and 1956 attempted to alleviate these unhealthy urban conditions by creating urban renewal programs. Under these Acts, cities established a local redevelopment authority (in Newark, the Newark Housing Authority, or NHA) that would purchase property in the slums, clear it for redevelopment and relocate anyone displaced by the clearance. The federal government subsidized two-thirds of the costs incurred by the cities for acquiring and clearing the land. The Acts also funded the creation of housing projects for residents displaced by new development. These housing projects, however, isolated African American and poor residents from other parts of the city by concentrating them in one area.

Ultimately, these federal programs were not only an attempt to find a "suitable living environment for every American family," but also an attempt to help cities regain some of their lost tax revenue. But red tape, confusing legislation and inefficient management undermined many urban renewal programs. Tax exemptions provided to developers under New Jersey's Fox-Lance Law prevented the city from collecting property taxes on urban renewal projects.

Departing white residents, however, did not leave the city for good. As the Kerner Report, issued in 1968 by the federal government in order to assess the nation's riots, demonstrates:

Many of these persons, as downtown areas were cleared and new office buildings were constructed, continued to work in the city. ... During the daytime, Newark more than doubled its population and was, therefore, forced to provide services for a large number of people who contributed nothing in property taxes.

The rising cost of taxes was an issue for Newark in the '60s. The Kerner Report cited rising homeowner taxes as part of the reason for white flight. Newark was unable to collect taxes on almost two-thirds of its land due to white flight and tax exemptions—of its 15,085 acres, 9,140 were tax exempt. Thus, much of the tax burden for the city had been placed on the homeowners, who were steadily dwindling in number. Ironically, urban renewal, which sought to alleviate this problem, in many ways added to it.

Since their beginnings in 1949, Newark's urban renewal projects under the direction of NHA were mismanaged. In many cases areas were declared blighted and were cleared, but they were not developed quickly enough—if they were developed at all. The cleared land left vast tracts of ugly and untaxable lots.

Newark was losing not only its population and its tax base, it was also losing jobs. Between 1966 and 1976, the city lost 53,473 jobs. Meanwhile, in all surrounding counties except for Hudson, employment rose. Many of the jobs lost in Newark were in manufacturing and industry. With Newark's big industrial center, the flight of industrial jobs hit particularly hard. It also disrupted the African-American community because the overwhelming majority of jobs held by African Americans were blue collar and industrial.

What Newark also lost in larger numbers were its service sector jobs. In 1966, it held the state's second place for percentage of employment in the service sector. By 1976 it had dropped to fifth. Newarkers employed by Prudential Insurance Companies decreased from 14,000 to 4,000.

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