Defunding Gentrification, Rent Support Stops Homelessness, and Mansion Taxes on the Rise

Photo via Wikimedia Commons

This week’s newsletter features three news snippets and a Quote of the Week:

Defunding Gentrification

I published an article in Jacobin last month on the Historically Black Neighborhood Ordinance introduced in Louisville. It is an anti-gentrification idea that national advocates say can and probably should be taken up in other cities across the country. The entire article is available online (no paywall). An excerpt:  

The HBNO targets an Achilles’s heel of the gentrification process: it is often deeply reliant on government funding. Developers have received millions of dollars from both the Louisville Metro Government and the US Department of Housing and Urban Development to develop market-rate or nearly market-rate housing on the same sites where affordable housing once stood. The HBNO aims to cut off that supply. It would block the Louisville government from providing any resources — including money, land, or staff support — to development projects unless those projects can prove that they will be creating truly affordable housing.

The ordinance also addresses a core flaw in many communities’ programs to develop so-called affordable housing: the housing subsidized by the government is still far above the means of the people in need.

(T)he local affordable housing trust fund spent most of its millions subsidizing housing that is targeted at households at 80 percent of area median income, enriching developers who end up renting out housing at nearly the market rate.

So the HBNO would require that a proposed development prove that its planned rent or selling price is truly affordable housing for those living at the neighborhood’s median income, which in many historically Black neighborhoods is far below the overall area’s income. If the proposed development cannot prove that its housing will be affordable for those already living in the area, it is denied access to any city resources.

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Louisville’s HBNO may be the nation’s most precisely targeted effort to prevent further displacement from historically Black communities. Brook Hill, a fair housing and community development attorney with the Lawyers Committee for Civil Rights Under Law, is one of several national housing experts who applaud the Louisville campaign. “Bold steps like this by local governments are necessary to negate gentrification’s tendency to uproot communities with rich histories and create racially exclusive neighborhoods,” he said.

Rent Support Prevents Homelessness: The Latest Evidence

New analysis released last week by the U.S. Department of Housing and Urban Development (HUD) shows that the federal government’s pandemic response, including emergency rental assistance and the enhanced child tax credit, kept millions of people from becoming homeless. “What does the research tell us about how to end homelessness in the U.S.?” the HUD report asks, then answers its own question. “Homelessness is a housing problem. The lesson of 2021 is that we can slow the inflow into the homeless system by preventing evictions. It also shows that we can reduce the number of people experiencing unsheltered homelessness by offering non-congregate shelter options such as motel rooms.”

Mansion Taxes Making Progress

Chicago Mayor Brandon Johnson’s support and a new report from the city’s Inspector General are adding to the building momentum for a plan to increase taxes on the sales of Chicago properties worth $1 million or more. The “Bring Chicago Home” proposal could generate $100 million annually to build new permanent housing that includes wraparound services. This comes on the heels of Los Angeles voters last year overwhelmingly approving a “mansion tax,” Measure ULA, that imposes extra taxes on the sale of property worth over $5 million. The money generated could be as much as $1.1 billion annually. It is slated for  building affordable housing and providing rental or cash subsidies to low-income older people and people living with disabilities.

Quote of the Week

Samuel Stein, housing policy expert and author of the highly-regarded book, Capital City: Gentrification and the Real Estate State, writing in The Architect’s Newspaper last week: 

“Building expensive housing is just far more profitable than building affordable housing. As long as our system depends on for-profit actors to build, own, manage, and maintain our homes, good quality affordable housing will always be out of reach,” Stein says. “We need nonmarket actors to produce social housing.”