In Dubai, the local emirates designated broad strips of land as freehold, or private property, in 2002 to lure developers.

It is already luring developers.

The Governor also proposes luring developers of rental housing back to the cities by making them "an offer they cannot refuse."

"This is a disadvantaged area," said Mr. Seymour, in explaining the attractions offered to lure developers.

The rezoning, along with the promise of quick approvals and public subsidies, lured several major developers into Peekskill.

That prospect has already begun to lure developers and Manhattan artists to the town.

The authority has tried unsuccessfully to lure residential and retail developers to the property for at least a decade, Mr. Bianchi said.

He talks about cleaning up pollution, banishing the dumpers and luring "classy" developers to the site.

That will leave many local governments two choices: lure new developers into their communities to pump up the tax base or to turn again to higher property taxes.

Many communities work with such agencies as a way to lure developers through tax or financing advantages, and to provide liability protection.