MBA Culminating Project, March 2005
by Karen Pickett
Shirley Bennett watched in dismay as the crowd jeered and shouted at the departing councilman. The small town of Ruston was embroiled in controversy and the last few community meetings had turned ugly. The threat of personal lawsuits had just caused one of the elected officials to resign, to the seeming delight of the angry crowd. Despite her own opinion on the current conflict, Shirley was more concerned about how her neighbors were treating each other. She had seen many heated debates over in her 20 years in town, but none as confrontational as this one. “Does change have to be this difficult?” she wondered. She worried about the future, too. Consensus on where the town was headed seemed impossible.
Her tiny community had seen tremendous upheaval in the last two decades. The 5-square-block municipality housed 725 residents in 200 structures and sat on a peninsula with spectacular water views, next to the largest municipal park in the state. (Exhibit 1) In many ways, this community served as a microcosm of the cultural shift from a blue collar, frontier town to a white collar, upscale community; a shift that many larger cities had experienced; all happening in less than 20 years for the small town. As the former company town for a copper smelter, Ruston had been devastated by the closure of the plant in 1985. By 1990, the federal government had declared the entire town a Superfund clean up site because of arsenic and lead contamination in local yards, caused by smelter emissions. The town not only had to face the loss of its main tax base and primary employer, but the pollution debate impacted Ruston’s image and internal culture.
The current controversy began when the town decided to sell a piece of property for a 6-story condominium building. Developers had approached elected leaders after discovering the view property adjacent to a former elementary school that was owned by the town. The tiny municipality was on the verge of bankruptcy, and offer was seen by many as the chance to save the small town.
The controversy had been building for over a year. In 2003, the council had commissioned an appraisal on the school property. The $1.2 million value was based on tearing down the 1920 building that took up most of the block, and building single family homes in the residential neighborhood. The council then asked for bids and development scenarios from a variety of developers rather than accept an unsolicited offer from the newly formed Ruston Landing Group. Only two viable bids were received, each with different development concepts that paid about the appraised value for the property. One would extend the school building north and south into the parking lots, converting the new, larger building into market-rate apartments. The second proposal would turn the school building into office space, but take advantage of current zoning flexibility to build a 6 story condominium building on 10 - 25’ lots in front of the school. Leaders preferred the condominium offer and negotiated with Ruston Landing Group. The negotiations resulted in a complicated deal that ultimately paid the town $4.25 million. (Exhibit 2)
Ruston was not alone in its struggle to maintain its financial or social quality of life. Across many communities, shifting societal priorities had eroded the connections and sense of kinship that many neighborhoods had enjoyed in the past. Now, neighbors rush past each other, facing longer drives to work and are distracted by greater recreational choices that keep them away from home. When they are home, there are more indoor activities with television or the computer that inhibit the traditional conversations over backyard fences. All these contribute to a growing sense of isolation and loss of community. Although not unique in this challenge, with its confined locality and dramatic change events, Ruston serves as a magnifying glass for much larger societal changes.
The Town of Ruston is a 4th Class town as defined by the State of Washington. As such, the municipal structure is a strong mayor form of government. The mayor has exclusive power to hire and fire town employees, administer the town’s business and serves as the executive branch. The staff at town hall consists of a Clerk-Treasurer, a part-time utility clerk, a part-time court clerk and two full-time maintenance personnel. The clerk handles all town business while the utility and court clerks collect payments and administer those departments. The clerk positions were currently filled by folks who had been with the town less than 5 years. On the other hand, the maintenance men both lived in town and had worked for the town for decades. Ruston is served by a volunteer fire department whose chief has run the corner grocery store for over 20 years. The police chief has been in the role about three years, with one full-time and several part-time officers. The current mayor had been police chief for 10 years before taking a new job and being elected mayor three years ago.
The 5-member town council provides financial oversight, sets the annual budget and serves as the legislative branch. They approve contracts and monitor the finances of the town. The senior council member had held that position for over 40 years and another had served off and on for about as long. Another council member had served for about 12 years and the final two members were in their first term of office. Three council seats and the mayor were up for re-election that coming fall. All of Ruston’s elected positions are essentially volunteer, paying less than $50 per month.
Shirley and her husband were friends with the current mayor and had moved into the Ruston area in 1985. She had served as a council member from 1987 until 1992, just after the smelter shut down. She had remained active and was the current chair of Ruston’s Development Committee. As part of her undergraduate studies, she had written several papers documenting the history of the town. That history was changing right before her eyes, and Shirley reflected about the important milestones for the tiny town.
Ruston officially incorporated in 1906 as part of the explosion of urban development on Tacoma’s Commencement Bay. Ruston’s legacy is that of the Industrial Revolution, when man took pride in taming the earth. It was that force that laid the seed for Ruston when Tacoma business leaders built a smelter in 1880, first to process lead. When the facility was sold to operations manager WR Rust, he converted to a copper operation. He sold the growing business to the Guggenheim brothers, who incorporated it into their American Smelting and Refining Company (Asarco). The area outside the smelter gate was home to most of the rough and tumble men who worked the grimy mill. The area was known as Smelterville, and when Tacoma threatened to annex it in 1890, the first thought of incorporating was born. (Ledger, 1890) As Tacoma continued to grow west along Commencement Bay, Rust had his smelter lawyers draw up petition papers and the subsequent incorporation election was a resounding success. (Ledger, 1906)
By 1910, it was clear the industrial boom was is full swing. Many homes had extended families living together and six addresses listed more than 10 borders in that year’s census, mostly immigrants from the same origin. There were at least two major hotels at the smelter gates with year-round guests. Early photos showed houses in the midst of smelter buildings, with single-family homes gradually growing predominant up the hillside from industrial operations.
Ruston was always fiercely loyal to Asarco. Most residents worked at the smelter and walked to work. The streets were “black with men” when the whistle blew at shift change. (The News Tribune, 1984) The town had their own school to serve local children through 8th grade, with a reputation for tough kids that excelled in area football and basketball championships. (Tallman, 1998) The first school burned down, along with the rest of the adjacent businesses in 1917. (Ruston Market Menu, 1998) In its place, a brick building was constructed in 1920 as the only structure on the block. The building was heated with steam from smelter operations, and the windows, along with those in the rest of the town, looked out over the roof of the smelter operations down the hill.
The first election reflected the lingering sense of a frontier town, where the strongest connections were to each other and to the company that provided for them. There were 122 voters; 51 of foreign birth and only one voter native to Washington State. (Voter Books 1 & 2, Town of Ruston) All the voters worked at the smelter or with supporting businesses. The town was able to collect substantial taxes from smelter operations so that garbage service was free. Asarco paid to pave all the alleys in town. By World War II, civic leaders across Tacoma boasted that 12% of world’s copper was produced locally, an important contribution to the war effort. (The Times, 1945) Asarco was the largest county employer for many years, with over 1,300 employees. (Tacoma Historical Society, 1996, quoted in 1997 Ruston Community Assessment)
Most of Ruston’s elected officials worked at the smelter as well. Owen Gallagher had been mayor for over 30 years, and was Asarco’s Safety Manager. He often led the town in support of Asarco in disputes with the outside world, writing letters to the editors of local papers and arguing with regulators. Public complaints, however, were rare before the advent of environmentalism in the 1960s. The cultural revolution of this decade spawned a movement in popular culture to return to the pristine conditions of nature, to reject the industrial age and the corporations that ran it. As this new generation fought against what they perceived to be the evils of modern society, the giant smokestack and aging industrial complex became an easy target.
By the 1970’s, President Nixon had created the federal government agency that would become the Environmental Protection Agency (EPA). One of the first issues for the fledgling agency to consider was arsenic emissions from the Ruston smelter. The agency held a hearing in Tacoma in 1975 to discuss new regulations that threatened to shut down the smelter. The invitation noted that “the task requires the cooperation of ASARCO, smelter workers and local residents, not to mention the understanding and support of the public at large... The outcome of all our efforts will have direct impacts on thousands of Puget Sound residents due to the serious socio-economic and health implication inherent in the decision to be made”. (Smith, 1975)
The debate continued for years. Many Rustonites, long independent and distrusting of the larger community, fought against EPA. Gallagher described the town’s heritage, “People came here looking for fire and smoke so they could make a living,” and he dismissed the health risk as “bologna.” (Pierce, 1982) His neighbor, Jean Wingard, disagreed, “They’re getting paid down there to live and work in it. I’m not getting paid to breathe it.” (Gillie, 1983) Many worried that the survival of the town itself might be jeopardized if the smelter were forced to close.
A letter to the editor captured a common concern of the time, “The loss of the smelter and the business it generates within the community will cause more than just economic damage. Closure of the smelter will also result in serious psychological damage to many families in this area. Any blue-collar worker can tell you what too often happens to a family when the father and provider looses his job. People too often think of the smelter as a bunch of ugly buildings with that big smokestack on the hill. But the smelter is also a whole lot of people and families that depend on it for a job and a livelihood.” (News Tribune, 1976)
The end finally came when the smelter furnaces were extinguished in March 1985 and the last 550 employees were sent home. “We were like a big family,” lamented employee David Huntstock. He also worried about his blue-collar skills in the growing white-collar world, “I guess I’m what you would call a functional illiterate.” He was one of 200 employees to receive retraining; 115 were placed in new jobs and 30 took early retirement. (Gillie, 1986) The financial impact was hard on the employees. The manager of the smelter credit union reflected that almost everyone managed to repay their loans, but many needed extra time. (Adams, 2005)
The huge smelter smokestack could be seen for miles and was a well known marker on navigational maps. On January 17, 1993, eight years after the smelter closed its doors, the stack took its final bow as it tumbled in eight short seconds. The adjacent bay filled with boats and an estimated 100,000 people crowded into Ruston to watch. For many longtime Rustonites, the event symbolized the larger community’s rejection of the industrial base that had built not only Ruston, but Tacoma as well.
The closure of the smelter caused an 89% drop in tax revenues for the small town. By 1987, Asarco had petitioned for a $0 value on its 97 acre property due to the clean up costs, further reducing Ruston’s tax base by $25,000 that year. Asarco tax revenue was estimated to have been $165,000 in 1982, reduced to well below $10,000 in 1988. (Ruston Block Grant Application, 1989) A 1988 needs assessment identified 54% of the Ruston households as lower income. That same assessment confirmed an aging electrical and sewer system, and major roadway concerns such as repairs needed on the main arterial, local bridge and cramped tunnel that all required major overalls in the near future. The town was able to secure grants to rebuild the electrical system and to realign the roadway to bypass the tunnel. It was later decided put the tunnel grant on hold to avoid re-doing the work in a few years until the smelter reconstruction was done in that area.
With its major tax base gone, the town had just begun to deal with the federal government. During smelter operations, regulations had been directed at on-going emissions from the stack. Within a few months of the smelter closure, EPA began an investigation into arsenic levels of the dirt in the surrounding residential area. In 1993, testing of soils was ordered in the neighborhood surrounding the smelter. But the program produced unexpected results. As the town clerk noted, “I don’t think people are as concerned about the health hazard as the devaluation of property an EPA cleanup might ironically cause.” Indeed, by 1992 some banks would not finance home loans in the area. (Clememts, 1992)
Property values were decreased for several years after the smelter closure. (Exhibit 4) That same decrease was not seen in the rest of the county. Values have increased an average of about 7% per year during this time period in both Ruston and Pierce County, but with different growth patterns. (Exhibit 4)
Everyone agreed that the Asarco property on the shore of Commencement Bay held unique opportunities for reuse. With dissension prevalent, the EPA asked that Asarco meet with the local jurisdictions to see if any agreement could be reached for future development of the property. The agency could then ensure its cleanup proposal would enhance, rather than inhibit, future potential uses. The approach was unique at the time, and reflected a growing national concern. As these types of sites were being cleaned up, the initial focus had been on the environmental requirements alone. This single-minded focus often made reuse of the property difficult. New businesses were reluctant to locate industry on these properties because of liability concerns, and because new construction meant the expensive cost of redoing any cleanup fix. Asarco held a series of workshops with the community in 1993, resulting in a Master Plan that was approved in 1997. (Aldrich, 1995)
Since 1970, Ruston census data showed some interesting trends, such as a 26% increase in housing units. The demographics of the town had undergone tremendous change, seeing a 134% increase in high school graduates and 350% increase in those with bachelor degrees. The median income had increased by 446% to $48,000 annually. The types of jobs had changed as well, with public employees increasing by 268% and self employed by 450%. Shirley felt those trends were continuing, but picking up even more speed in the most recent 5 years since the last census.
1997 Community Assessment
As Shirley reflected over the cultural changes that seemed to be gaining speed over the last two decades, she decided to compare the results of a just completed marketing research project on Ruston with a 1997 community assessment to see if any common themes surfaced. Perhaps some insights into how to better manage changes like the current condominium proposal might emerge.
The community assessment had been done eight years before by the local health department. The goal was to assess community strengths and priorities from the residents viewpoint. A total of 112 residents were interviewed, with any common responses being reported in the assessment. The formal assessment only provided a summary of comments, not any specific data gathered from the interviews.
The assessment noted the strong connection many people in the Pierce County area had to the smelter. Many Tacoma residents could trace their immigrant roots to parents who moved to the area to work at the smelter. The reasons for moving to Ruston were changing; rather than moving to town for work, newer residents were drawn because of affordable homes and the water views that had emerged after the smelter buildings were dismantled. Area businesses were primarily retail and the town was largely viewed as a residential neighborhood. Most residents now worked outside of town. The failing bridge over the train tracks that separated the town was seen as symbolic of the current status of the town needing to bridge its past to its future.
Those over 50 years old seemed to want the town to remain the same, while younger respondents wanted to enhance the town’s image. Although not spelled out in the assessment, this enhancement likely referred to a desire to remove the “contamination” stigma that Ruston dirt was known for. At the time of these interviews, the town was undergoing the massive yard replacement process ordered by EPA. This EPA project was seen “to offer a link to engaging the residents in creating a positive vision for the town in the future.”
There were common themes of wanting to preserve the safe and quiet of the small community, but an awareness of the need for increased tax revenue with Asarco gone. Some focused on wanting new industry re-established on the smelter property as the primary way to build a tax base while others saw the school as a major asset that could help re-vitalize the area. The need for general civic improvements was stressed, yet there was concern about the tax implications of increased property values for those on fixed incomes.
There was a keen sense of community and enjoyment of the small town feel in the midst of big city convenience. Older residents felt a stronger connection to the smelter, and cohesiveness through that connection. All acknowledged that the “community feels like a large family.” There was an acceptance felt by new families as they moved into town. The rumor mill ran strong and was seen as a way of caring about one’s neighbors. The corner market, with its soda fountain to foster conversation, served an important networking function. Formal leaders were identified as the elected, police and fire officials. Informal leaders were seen as business owners, realtors and developers. These were portrayed as “visionaries of the future and not afraid of change.”
There were other issues raised related to change. Some elected leaders were seen as resistant to change and unable to create a vision for the future. “Anytime you bring up activities, the Town Council has to analyze it, consider it, discuss it, and promise to get back to you. But they never decide…you have to wait too long for answers.” Local police and fire protection were important identifiers of the small town. There was concern about being annexed into the larger city of Tacoma, which was seen as faster paced and not as safe. Several assumed that annexation was inevitable with the town’s aging infrastructure and reduced tax base.
There was a common focus on the need for business on the Asarco property, “It doesn’t matter what we want to see in our future, what happens down on the waterfront will shape our future.” The on-going environmental clean up of area yards was seen as positive transition to overcome the “contamination” stigma, even though there was still debate over any health need. The primary theme was a desire to preserve the “core qualities of safety, quiet and neighborly caring.” The assessment ended with several recommendations that were never implemented.
2005 Focus Group Assessment
As she examined results of the 2005 marketing research, Shirley was struck by many similarities with the previous assessment. A group of marketing students had conducted 4 focus groups and used the results to develop a survey that would be distributed to the entire town soon. (Exhibit 3) This survey should provide quantitative data that could be analyzed in greater depth for relationships and connections to the issues raised in the focus groups. The focus groups consisted of businesses, elected leaders, long-time (over 20 years in town) and newer residents.
The current focal points centered on the newly repaired bridge and adjacent road improvements, the condominium proposal at the school and the Commercial Street lots sold by the town in 2002 that were being developed into expensive residential homes. Older residents still expressed concern that changes were happening too fast and that the many unknowns caused stress; yet newer residents felt that change was taking too long. Those new residents expected “the lid to blow off in the next three or four years” on development. Although it was acknowledged that the current changes were difficult and felt fast-paced, they were seen as common trends that were happening across society. The need to commute to work added to the fast-paced feeling. The loss of connection among neighbors along with the aging infrastructure were on-going concerns, especially the 100 year old sewer system.
The small town feel was still important to most people, although not mentioned as much or valued as strongly by newer residents. Longtime residents wanted to strengthen this feeling by organizing social events, while the newer residents felt zoning codes that required a consistent style of homes would enhance the sense of a small town. These new families were moving to town for the views and reasonable price of real estate, but without any longing for small town connections. Most residents felt that maintaining that sense of community was up to them, but was easier because of the geographic limitations of living on a peninsula. There was still a friendly acknowledgement that “everyone knows everyone else’s business.” There continued to be value placed in having an independent police and fire department, which provided shorter response times and tax advantages for businesses and homeowners. Knowing and being known to the town staff was important.
There were concerns about growing divisions between old and new residents, rich and poor and even geographically as the waterfront developed from the established neighborhood up the hill. Worries continued about seniors on fixed incomes being taxed out of their homes if property values continued to explode. There was distrust expressed on two fronts; of renters and a perceived increase in absent landlords, and of the higher income homeowners and potential new businesses on the waterfront who had more money and therefore power.
There were several comments about the difficult transition away from dependence on Asarco. There had been years of complacency after the smelter shut down, a pattern established in the days when Asarco did everything for the town. Even when the facility closed there was an expectation that the company would take care of the community. Tom Aldrich, the Asarco site manager from 1990 to 2000 and now a vice president with Asarco, was viewed as having a major influence on the redevelopment plans for the smelter property. His continued oversight of the project was reassuring to many residents.
The election of a new mayor and two new council members three years ago were seen as pivotal events. The election replaced Ruston’s elected leadership with one that encouraged immediate development and forward thinking rather than the established holding pattern of waiting for the Asarco development. That holding pattern had created a financial crisis for the town, which faced its first budget shortfall the first year the new leaders assumed office in 2001. With the Asarco development still years away, it appeared the town’s expenditures would continue to outstrip revenue into the foreseeable future. The town seemed headed for bankruptcy, and probable annexation into Tacoma. The emergency helped move one of the established council members to embrace the new direction of immediate development. One of their first actions was to sell several town owned lots on Commercial Street, a concept that had been under study by the previous council for several years.
There was a common theme in the focus groups around wanting input into continued development, especially on the Asarco property. This was contrasted with worry about slowing progress and a hope, rather than demand, that any new Asarco developer would involve the community in their direction for development of that property. Some felt the council no longer listened to input from citizens, especially on the condominium project. Newer residents saw development as an important tax base. All groups noted a huge increase in property values over the previous 9 months, with some of the longtime residents expressing strong concern over seniors being taxed out of their property.
As Shirley contemplated the town’s history, she wondered what the next steps should be. The town would elect the majority of its council and mayor in the fall. Was there any way to reduce the current divisions and conflicts, especially with an election looming? Were there effective measures the town could take to embrace the escalating rate of change that would maintain the best qualities of the small town? Even if those measures could be identified, would they be implemented and not ignored as had so many suggestions of the past?
It appeared there was not any unified vision for the future. Older residents seemed focused on cohesiveness and social structure, wanting Ruston to return to the close-nit family it had been when everyone’s lives revolved around the smelter. Newer residents were not interested in the same values, and seemed to embrace changes without any specific goal or plan for where the town was headed. They seemed to focus on structural changes that would enhance property values, envisioning Ruston would soon become “the most expensive real estate in the south Puget Sound”. Shirley had a growing sense that there needed to be a strong, clear, united picture of what Ruston should look like in 5 or 10 years or beyond if there was any hope of controlling the rollercoaster they were on; or of easing the growing divisions between different factions of town residents. Managing these changes were an important component to preserving Ruston’s quality of life.
She committed herself to closing the data gaps that would be needed to answer these questions, such as completing the survey generated by the focus groups. In addition, she needed to confirm what recent property sales values had been. She knew she had access to property value and census data, as well as the town budgets since the smelter had shut down. (Exhibit 4) She hoped careful analysis of this data would lay the groundwork for building consensus and a roadmap to a unified, realistic picture of Ruston’s future. While the rancorous crowd cheered as door closed behind the departing councilman, she hoped that roadmap could be laid out soon.