© 1989 by CSF Associates Inc.
The Life and Death of UDAG: An Assessment Based on Eight Projects in Five New Jersey Cities
Princeton University
The federal Urban Development Action Grant program, begun in 1977, provided $5 billion over eleven years revitalizing severely distressed urban places through the encouragement of private sector investment. Designed to assist commercial, industrial, and housing projects that "but for" the federal grant would not be built, the program was characterized by a streamlined grant-making process administered by finance and development experts. Eight UDA G projects in five New Jersey cities, first studied in the proposal stage in 1979 and revisited in 1987, show that the UDAGs succeeded in attracting development to these hard-pressed cities. Although the projects succeeded, the program was unable to arrest the more general distressed conditions of the cities. During the Reagan years, the administration sought to end the program. Congress supported it, but reduced the funding each year. In an effort to gain support for the program, eligibility requirements were broadened to include more localities. These efforts failed, and in 1988 Congress did not fund the program. Despite its demise, UDAG is recognized as having stimulated urban revitalization and having created a new model for private sector and public sector collaboration in economic development.