INSTITUTIONAL APPROACHES TO COMPARATIVE URBAN GOVERNANCE

Although urban-regime theory (Stone Reference Stone1989; Reference Stone2001) effectively merges structural- and agency-based approaches to explaining local outcomes, it does not adequately explain the growth of public–private partnerships and new institutions of local government, especially in a comparative context. Capital is increasingly mobile, domestically and internationally, and therefore less dependent on engaging in long-term coalitions with local leaders. In fact, in some cases, there is less institutionalization of long-term governing coalitions and more short-term governing arrangements. Regime theory, rooted in the existence of long-standing governing coalitions, does not explain this fluidity (Stone Reference Stone1989). Some governing coalitions, especially those around development, tend to be increasingly fickle and may last only through the planning and implementation process until they dissolve. The Atlantic Yards Project in Brooklyn, New York, now rebranded Pacific Park, was developed through an ad-hoc coalition of a relatively new special-purpose authority or public-benefit corporation (with wide-ranging development powers, including eminent domain, but little democratic accountability). The coalition included the Empire State Development Corporation (ESDC) through its subsidiary, the Atlantic Yards Community Development Corporation (AYCDC); and Forest City Ratner, a local affiliate of Forest City Enterprises, now Brookfield Properties, a private real estate developer.^{Footnote 1} This ad-hoc coalition of (quasi-) public and private players dissolved as soon as the development decision was politically secured, at which time the private developer became the driving force of the project. However, the ESDC emerged as the main driver of urban development in New York state since the mid-1990s, representing not only a new development institution that does not actually play by the traditional rules of urban governance, due to its limited transparency, but also engaging in short-term development coalitions.

Elements of the public-policy literature are conducive to understanding contemporary urban-development processes in a comparative context, particularly the idea of variation in institutional access.^{Footnote 2} In a local-government structure built around a legislature, the policy process is designed to be open to multiple individuals or groups (depending on the institutional design; see Sharp Reference Sharp1991). Residents of a neighborhood could petition or speak to a representative on a local council considering changes to a local street, and the reelection of the representative may be tied to her response. The institutions managing urban development in contemporary global cities are often much less open. The policy-design literature addresses this scenario as well; policy makers may operate in institutions that promote policy solutions appearing to be socially equitable while creating unequal outcomes—whether in terms of access or policy outputs (Ingram and Schneider Reference Ingram and Schneider1990; Reference Ingram and Schneider1991; Ingram, Schneider, and Deleon Reference Ingram, Schneider, Deleon and Sabatier2007; Schneider and Ingram Reference Schneider and Ingram1988; Reference Schneider and Ingram1993).

In the cases of Berlin and Chicago, institutions being utilized (or created) to govern development seek to accomplish short-term goals by controlling access to decision making. The case of Berlin draws attention to this when, in the case of the Mediaspree development, significant local resistance to a major waterfront-redevelopment project along the shore of the Spree River, Berlin’s main waterway, arose. However, the nature of the institutional structures involved permitted development plans to continue despite this resistance. Several citizen initiatives and protests opposed the Mediaspree. The most successful initiative, named “Mediaspree Versenken!” (“Sink the Mediaspree!”) successfully lobbied enough signatures to enforce a referendum, in which a local coalition of residents and small-business owners introduced its own waterfront-development plan vis-à-vis the original plan. The district of Friedrichshain-Kreuzberg, where the development site is located, followed suit and presented a counterproposal, which was a toned-down version of the original proposal introduced by the City of Berlin. The referendum was successful: 19% of eligible voters cast their vote (i.e., 10% is required for the referendum to be valid) and a majority of voters (86.6%) voted in favor of the citizens-initiative proposal and against the district’s counterproposal (Die Tageszeitung, July 13, 2008). As a result, the district government of Friedrichshain-Kreuzberg promised to amend the City’s proposal to reflect the changes requested by a majority of citizens in the popular referendum. However, although the City of Berlin has an established institutional mechanism to hold popular referenda on such development proposals, a successful referendum is not legally binding. Instead, it only serves an advisory function, which City Hall can choose to ignore. Ultimately, in the case of the Mediaspree, the City chose to overrule the community’s development proposal and go with the original plan. Therefore, despite the institutional mechanism for popular feedback on development decisions that exists in Berlin, it runs somewhat hollow, and City Hall essentially can unilaterally force its desired outcome.

In Chicago, extra-municipal institutions managing urban development may be checked by parent governments (e.g., the city or the state), but the decision making within such institutions is relatively closed. The City’s recent mayors, in coordination with other actors—particularly governors and private-sector actors—collaborated to offload many development tasks to special-purpose governments. Prominent examples include the Illinois Sports Facilities Authority and the Metropolitan Pier and Exposition Authority, which were created to finance and manage a new stadium for the Chicago White Sox major-league baseball team and the redevelopment of Navy Pier, respectively (Smith Reference Smith2010). In the cases of Chicago and Berlin, therefore, institutional access—indeed, institutions themselves—has been shaped to respond to pro-development interests—sometimes on a case-by-case, short-term basis. Although it is certainly the case that regime theory suggested that governing coalitions characteristically work with private-sector interests, this was not necessarily the result of institutional design at the municipal level. A key component of several regimes, including Stone’s (1989, 96) case in Atlanta, also consisted of incorporating rather than excluding specific segments of the local population (e.g., middle-class black voters).

Public-policy and social-movement scholars have long focused on the idea of access and institutional design as key to understanding power (e.g., Truman Reference Truman1951). In this regard, Mahoney and Baumgartner (Reference Mahoney and Baumgartner2008) built on the idea of a “political-opportunity structure” in discussing a group’s ability to achieve policy goals (Tarrow Reference Tarrow, McAdam, McCarthy and Zald1996). Mahoney and Baumgartner (2008, 1264) defined opportunity as “the number of access points, the openness of those access points, the design of the political institutions, and the state of the political climate.” Eisinger (Reference Eisinger1973, 12) suggested that the openness of a political system or institution may be as important as the resources available to a group. When a specific system is closed, policy actors may seek a more favorable decision-making institution through the process of venue shopping (Baumgartner and Jones Reference Baumgartner and Jones1993), in which groups navigate different institutional venues to “win” the policy game. Venue creation is another option for local policy actors. When state or national governments create new local venues (or control existing ones) with specific policy actors in mind, equitable access for political groups becomes problematic (Sapotichne and Smith Reference Sapotichne and Smith2012).

Late-twentieth-century literature on urban governance veered from these institutional approaches, instead focusing on governing coalitions (Pierre Reference Pierre1999) and, specifically, their capacity to produce policy results (Stone Reference Stone2001). In response to ongoing criticism of regime theory, Stone’s (Reference Stone2015) most recent writings acknowledge restrictions that have limited its ability to explain the contemporary moment in urban governance—namely, that it was too temporally focused or suffering from “periodization.” Stone (Reference Stone2015) also suggested that different intergovernmental arrangements will be present in different political eras, part of his reconceptualization of urban regimes as one “political order” among several. In this context, urban-regime theory is recast under the umbrella of American political development, a more institutional approach (Dilworth Reference Dilworth2009).

By turning attention to institutional character of development and a more institutionalist approach, we see that urban-development policy making—as much as any other level of policy making—is shaped significantly by the institutional rules regarding access to decision making. Moving away from simply limiting local theories on development and institutions to the Anglo-American realm also can broaden the scope of urban theory in a more global comparative context. Perhaps what stands out about the urban case in the United States and federal democracies elsewhere is the flexibility that state- or national-level actors (and sometimes even municipal executives) have in shaping or creating new institutions with rules that will suit their policy goals. In some ways, therefore, we see the need to return to elements of an “old institutionalism” along with the new institutionalism advocated for elsewhere in the urban literature (e.g., Lowndes Reference Lowndes2001)—but one with a more global scope. By this, we also mean that scholars should be more explicit in their discussion of institutional rules and the impact on policy outcomes. This serves as a way to enhance comparative studies of urban policy while also more directly relating it back to the mainstream of political science and group/policy studies.

NEW INSTITUTIONS OF GOVERNANCE AND URBAN DEVELOPMENT IN BERLIN AND CHICAGO

Examples from Berlin and Chicago illustrate how this approach might be applied, especially when considering large-scale urban development. We suggest that access will vary by institution and policy area, generally becoming less accessible as development projects increase in scale (e.g., street fixes versus arena construction).^{Footnote 3} The examples presented here are limited due to space, but they illustrate larger trends in city governance and can be used to guide further research into development outcomes. The following discussion uses recent comparative work from the policy literature as a guide for inspecting access levels. First, what is the level of formal inclusion among specific urban advocacy groups in the institutions in question (Mahoney and Baumgartner Reference Mahoney and Baumgartner2008)? Second, what are the policy-making “rules” within the institution (Mahoney Reference Mahoney2007)—and, in the case of urban governance, how do such rules compare with decision-making structure in general-purpose local government? Third, what are the financing mechanisms within the institution and how will they indirectly affect access? Fourth, what are the channels for residents’ access to the institution?

In Chicago, the special-purpose authority has become a pivotal institution in urban-development mega-projects—a trend across other US cities and Europe as well. Special-purpose authorities are created to manage and, in many cases, finance large-scale urban-development projects. The use of special-purpose authorities clearly affects the first condition of access and inclusion in decision making. Governing boards of authorities (i.e., appointed by parent governments such as the state or city) bring certain interests directly into formal decision making while omitting others. For example, a representative from the real estate industry or labor might be appointed to a special-purpose authority’s governing board. There is little traditional access for citizens and residents. This institutionalization is one example of ways in which private interests are more formally incorporated into decision making.

In the case of financing mechanisms, the recently created Chicago Infrastructure Trust (CIT), which provides the private sector direct access to municipal finance decisions, is illustrative. According to its website, the CIT—a nonprofit created by then-Mayor Rahm Emanuel and governed by a hybrid public–private board of directors (Chicago Infrastructure Trust 2016)—aims to “assist the people of the City of Chicago, the City government and its sister agencies in providing alternative financing and project-delivery options for transformative infrastructure projects” (Chicago Infrastructure Trust 2018). The CIT is designed to offload the building and financing of certain infrastructure to private entities that bid for the opportunity to complete a project. The City enters into agreements with private contractors in which the private groups guarantee a certain level of increased efficiency and cost savings as a result of the infrastructure upgrade. The City then pays the amount of savings to the CIT so that the projects may be financed. This directly incorporates financial actors into policy making—a departure from traditional decision making that has been characterized as informal by regime theorists.^{Footnote 4}

Similar constructs can be observed in the Berlin case. After the fall of the wall and the reunification of Germany, the Berlin “city-state” government sought to rebrand the city’s image as a center of cultural consumption. This was an attempt to attract the much sought-after Creative Class, which has been hailed by many as a savior for struggling cities (Florida Reference Florida2002). Developing the Spree River’s waterfronts into such a “branded” cultural space represented the first major campaign of this “creative clustering,” which was targeted specifically at what the local government defined as “underutilized urban spaces” (Novy and Colomb Reference Novy and Colomb2013).

In 2002, the Media Spree Berlin GmbH was founded to develop the Spree River corridor and, to that end, attract private investors. The designation of “GmbH” (Gesellschaft mit beschränkter Haftung)—a limited-liability corporation—is a legal designation for a private company in Germany. The Media Spree Berlin GmbH was a private-sector marketing company that was intended to represent the interests of businesses, property developers, and landowners in the area. However, it also included representatives from the Berlin Senate and the local district, Friedrichshain-Kreuzberg, and therefore was more of a public–private partnership under the legal guise of a private corporation. In that sense—not unlike an American-style special-purpose authority—it incorporated players from the public and private sectors but resembled more a private corporation structurally, with minimal levels of public transparency and no democratic accountability.

In 2005, Mediaspree was transformed into a public–private nonprofit association (i.e., Media Spree Regionalmanagement e.V.). The designation “e.V.” (eingetragener Verein) translates roughly to “registered association,” comparable to a nonprofit organization. An e.V. is tax exempt and therefore legally obligated to act in the public interest (Bader and Bialluch Reference Bader, Bialluch, Porter and Shaw2009). According to Scharenberg and Bader (Reference Scharenberg and Bader2010, 329), the members of Mediaspree Regionalmanagement e.V. consisted of landowners, whereas representatives of the local and state governments, as well as the Chamber of Commerce, were advisory board members only with little power. In other words, private actors played a key role in the nonprofit’s supposedly public-interest mission: real estate marketing and planning of development in the area. Therefore, private actors were directly incorporated in public-interest development policy in unprecedented ways, similar to the Chicago case. Furthermore, after the citizens’ referendum and the community’s development counterproposal, the City of Berlin used its institutional powers to overrule the community’s proposal in favor of one that reflected the interests of the Mediaspree, despite popular opposition. Whereas this evidence suggests that access may have an inverse relationship with the scale of a project, a more expansive study is needed to understand this relationship. Certain factors could lead to greater access in some larger developments, but those are not evident in our cases.

INSTITUTIONS AND ACCESS IN URBAN POLICY MAKING

This article joined elements of the public-policy literature with examples from two national settings to demonstrate how institutional approaches to development—specifically, access to decision making—explain urban-policy-making outcomes. Placing urban-policy decision making squarely within the institutions where it takes place is one way for theories of urban governance to fully capture both the convergence of policy processes across countries and recognize the distinctive elements of specific cities. Existing theories of urban governance highlight the coalitional nature of urban decision making, but the power of such coalitions and their ability to accomplish policy goals are directly tied to the political institutions in which they operate.

Berlin and Chicago are cases in which institutions of urban governance are being designed (or, at least, functioning) with imbalances in political access. In coalitional models of urban governance, a lack of access might be explained by analyzing group capacity. However, shifting the focus to institutions, we see that unequal access heavily influences outcomes before policy debates begin. To better analyze institutional effects in case studies, urban scholars might apply Mahoney and Baumgartner’s (Reference Mahoney and Baumgartner2008) four questions discussed previously. Taking greater care in analyzing the institutions involved in urban policy making will lead to more robust theories of urban governance, allow for more comparative work, and connect contemporary studies of cities into the policy literature more broadly.