An article published in AlterNet today discusses residents’ fight against the privatization of public housing through the RAD program.
Read the full article on AlterNet here.
By Dusty Christensen, October 13th.
Since moving into her new East Baltimore neighborhood last month, Free Palmese has been practically alone on her block. A sea of vacant housing surrounds her rented row house; only six houses are occupied. Boarded-up windows and doors line the quiet streets, giving the neighborhood the feel of a long-abandoned ghost town.
“Nobody wants to live here,” Palmese says, leaning against her car. She didn’t have much of a choice. “I’m only here because I can afford it,” says Palmese, gesturing toward the abandoned block. Before moving into her row house Palmese was homeless, living in her car after being priced out of her former apartment. Finding this latest rental was simply good luck. “I only got this because the landlord is a friend of a friend.”
The irony of having been homeless in a city with over 16,000 vacant homes isn’t lost on Palmese. “How am I homeless when there are all these boarded-up houses?” she asks incredulously. There shouldn’t be anybody in the street.”
Like many American cities, Baltimore faces a serious housing crisis. Vacant lots and homes pervade the landscape, yet a large number of residents are struggling to find affordable places to live. Close to 50 percent of metropolitan Baltimore households are “rent-burdened” — defined by the federal government as paying more than 30 percent of income on housing. The once thriving industrial economy that powered this city, like so many across the country, has all but vanished, leaving in its wake a shrinking population and a dearth of well-paying jobs to afford the ever-increasing rent. Of 80 low- and moderate-income Baltimore jobs analyzed by the Center for Housing Policy, less than 35 percent make enough to meet the threshold of rent affordability for a two-bedroom apartment.
Baltimore’s vacant housing isn’t the only problem in need of a fix. After years of underfunding, the city’s old public housing buildings are desperately in need of repair. Many are plagued with leaking roofs and windows, poor heating and air ventilation, broken elevators and doors, and bed-bug and rat infestations.
Baltimore Housing Authority’s annual maintenance budget has faced continued cuts over the years, allowing much-needed work to be delayed over and over again. And Baltimore is not alone in this dilemma. The U.S. Department of Housing and Urban Development (HUD) has an impossibly large $26 billion backlog nationwide for large-scale repairs on public housing.
Across America, the answer to these pressing housing problems has increasingly been to rely on free-market solutions. The state has been steadily withdrawing from providing public services, inviting private capital to deal with its woes. In order to entice private investment in the public sector, developers and private companies are given lucrative tax breaks and handouts. Far from solving these serious issues, though, so-called “public-private partnerships” often exacerbate the very problems they claim to be addressing.
Baltimore is no exception to this trend. Like her predecessors Sheila Dixon and Martin O’Malley, current Baltimore Mayor Stephanie Rawlings-Blake is beholden to large developers. She has made private investment-driven development a priority, often at the expense of ordinary citizens. Large developers have received all sorts of corporate welfare from the city in exchange for the usual assurances: increased efficiency, greater city revenue, relief for strained municipal budgets and an expansion of services. However, reality is often far removed from these empty promises.
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Charlene has lived in the neighborhood of Greenmount West for most of her life. Sitting on the stoop of the house she was born in and now owns, she describes the area’s recent changes. “All the vacant houses — they tore down houses here,” she says, indicating an empty corner across from her house. What was once a blighted and crumbling neighborhood is now a designated “arts and entertainment district,” boasting a large number of renovated row houses, an artists-only affordable apartment complex, a magnet high school for design students and high-end graffiti murals.
Greenmount West is one of the many Baltimore neighborhoods affected by Mayor Rawlings-Blake’s signature market-based revitalization initiative, Vacants to Value. Hoping to repopulate the shrinking city and fix some of its blighted neighborhoods, the program is billed as “cleaning up and redeveloping” vacant properties in an effort to “help raise property values, create community amenities, increase local tax revenue, and attract new residents and businesses,” according to the Vacants to Value website.
Vacants to Value uses several different strategies to combat the issue of vacant housing. In areas deemed “strong neighborhoods,” streamlined housing-code enforcement pushes landlords to fix their properties or risk losing them under auction to another owner. Neighborhoods with a larger number of vacants are deemed community development clusters. In these areas, developers capable of renovating whole blocks are encouraged to buy both city-owned property and property pushed into auction. Greenmount West is one of these clusters.
Looking at the data, it’s not hard to see why the city picked Greenmount West as an area ripe for developers. Median household income in the neighborhood has increased around 156 percent since 2000, according to census data. This is compared with a 35 percent increase in Baltimore city as a whole. In the same time period, median gross rent has gone up by 118 percent.
Rising property values bring a wealthier tax base into the city, which alleviates city budget shortfalls and provides a lucrative investment opportunity for the powerful and politically influential real estate industry. The median sales price of houses in Greenmount West is 50 percent higher than in the rest of Baltimore, according to data gathered by Trulia, an Internet marketplace for residential real estate, providing a windfall investment for developers looking to turn a quick profit. But while backing increased property values as a solution to vacants may serve as a suitable solution for homeowners, the city budget office and the real estate industry, it ends up leaving many residents behind.
Long-time activist and scholar Marisela Gomez has been organizing against gentrification in East Baltimore for years. She thinks Vacants to Value is a good program in theory, but questions some of its methods. “The intention behind it is good — turning vacants into value, who can fight that?” she asks. “But who are we attracting into those vacants?”
The answer lies in the simple fact that in order to purchase a vacant from the city, potential homebuyers have to demonstrate they have good credit and enough capital to be able to bring the building up to code. This is something poor Baltimore residents simply can’t afford.
“There needs to be more intention to help local residents become homeowners though the program,” says Gomez, “so that they’re not just getting rolled over to build a ‘better Baltimore’ that doesn’t include them.” Right now, she says, the message seems to be “we need people other than you to make this city better.”
Nobody denies that abandoned housing is bad for any neighborhood. However, when a particular real estate market becomes “hot” due to revitalization or nearby investment, property owners and developers gain while housing affordability becomes a serious problem for low-income residents. For people like Charlene, property taxes might rise, but as a homeowner she ultimately benefits from increased investment. Renters, on the other hand, face increased hardship and are often pushed out of their neighborhoods.
Krissy Turner has rented for 10 years in Patterson Park North, another community development cluster. Turner confirms that property values are also on the rise in this neighborhood. “These houses around here used to be sold for what they were worth,” she laments. Turner says that rent has increased noticeably in the last four years — the same time period Vacants to Value has been in operation. “That’s just going to make it hard for people like us who don’t have jobs with benefits and stuff like that — single moms with kids,” she says. This is the very same area Free Palmese was priced out of a year ago. Baltimore renters are finding themselves in more and more precarious situations across the city, and not just in private housing.
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“Housing is a human right!” chanted irate public housing tenants and workers outside of the Housing Authority of Baltimore City in mid-June. Holding picket signs that said “Rethink RAD!” they marched in front of the building, demanding action.
The signs and slogans refer to an Obama administration program, Rental Assistance Demonstration (RAD), that will privatize more than 60,000 public housing units by next year in a bid to fund desperately needed repairs. The city of Baltimore has jumped headfirst into what’s only being considered a pilot program, placing over 40 percent of the city’s public housing stock in the hands of private investors. To sweeten the deal for developers buying the buildings, Baltimore is handing out exceptionally generous tax breaks. In return, the city hopes to pocket $147 million from the sale of the buildings, in addition to hefty developers’ fees.
RAD “will be a real shot in the arm — and as I’ve said in some places a lifeline — for our public housing communities” said Baltimore Housing Commissioner Paul Graziano in a RAD promotional video. The city estimates that some $800 million in capital repairs are needed in the city’s public housing. Baltimore Housing did not immediately respond to requests for interviews for this story.
Despite talk of inclusivity and community engagement, those living in public housing were completely left out of the decision-making process. “Nobody consulted residents about it,” says Jessica Lewis, an organizer at the Right to Housing Alliance (RTHA). The organization starting building opposition to RAD after public housing residents came to the group with their concerns. The residents had only learned about the program after the Baltimore Brew broke the story early this spring.
Many critics are skeptical of the wholesale giveaway of one of the city’s most valuable assets. According to Baltimore Housing figures, close to 20,000 people rely on public housing in the city, and many are concerned about the future of the buildings under private control. Private companies — some of the same ones buying buildings under RAD — have a suspect record as landlords in Maryland, and public housing workers are concerned about layoffs. In a city already desperately rent-burdened, many are also worried about long-term affordability in the buildings; RAD affordability requirements will expire after 30 to 40 years.
“If there aren’t any affordability requirements built in permanently, there’s nothing stopping developers from turning these buildings into market-rate housing in the long term,” Jessica Lewis says. Although promises have been made about affordability, many residents are justifiably skeptical. Because almost everyone in public housing has lived in private housing previously, “most tenants have seen firsthand…what private landlords look like,” Lewis says. “Especially when there aren’t rich people on their backs about fixing up their apartments.”
Especially troubling is the fact that many of the buildings are high-rise towers located in high-opportunity development areas: Lakeview Towers is located across from the scenic Druid Lake in the historic neighborhood of Reservoir Hill; Bel Park Tower is located right across from Johns Hopkins hospital, which is the main engine driving gentrification in East Baltimore; Chase House is located in the neighborhood of Mid-Town Belvedere, home to a slew of bars and restaurants, plus the symphony hall and opera house. The list goes on and on.
Due to pressure from residents, workers and organizers, Baltimore Housing said it was not selling the land beneath the buildings. However, it is still unclear how the city will leverage this fact to push developers to implement permanent affordability in the buildings.
Another question residents have is whether the city has a plan to purchase the buildings back. Housing Commissioner Graziano has said that Baltimore Housing will have the “first right to refusal” to repurchase after RAD contracts and their affordability requirements expire, although how they will do this if they can’t even afford to repair the buildings now is anyone’s guess.
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Both RAD and Vacants to Value are indicative of a broader trend toward public-private partnerships across America. “It’s just a way to get the government…out of the business of providing services for poor people,” says Jessica Lewis, who is especially critical of Mayor Rawlings-Blake’s role in these schemes. “Instead of seeing poverty as something that needs to be fixed, she sees it as something to be pushed out of the city.”
And indeed, that’s what is happening. As it becomes more difficult for poor people to afford to live in Baltimore city, many are moving out to “the county” — the same suburbs populated during post-war “white flight” by those who wanted to avoid the poor all together. Between 2000 and 2011, Baltimore county’s suburban poverty rate grew 58 percent, according to research done by the Brookings Institute. This is compared with a 4 percent increase in Baltimore city proper.
These numbers point to a disturbing trend taking place all over the U.S.: the suburbanization of poverty. As wealthier residents move back into cities across the U.S., the displaced low-income communities are forced into the suburbs. And because the social safety net in the U.S. is so focused on urban areas (just try riding public transportation or using food stamps in the suburbs of Atlanta), this population finds itself in an incredibly precarious situation.
Private-public partnerships aren’t good at dealing with public problems. What private-public partnerships are good at is moving problems around, pushing them to the periphery and out of sight of those who matter to the market: people with money to spend. Because equality is not a priority to the market, free-market solutions to public problems will inevitably marginalize the poor and powerless.
With a homeless population of over 3,000 and almost a quarter of the population under the poverty line, private “revitalization” means little more than climbing rents for Baltimore’s poor. Throughout the U.S., similar processes are at work as governments hand over many of their old responsibilities to the private sector. The question is, whose responsibility is it to provide services for citizens in need: the nation or the corporation?
Back among the boarded-up vacants on Bradford Street, Free Palmese daydreams of rehabbing a block or owning “a house with a rooftop deck and all that good stuff. I wish the city would…give people like myself that have damaged credit and not a lot of money the opportunity to be a homeowner.” Unfortunately, it seems like the city’s priorities will likely see Palmese move again rather than achieve her dream. After all, she lives in a Vacants to Value target area. Houses are already being bought and rehabbed, and Palmese’s landlord has promised her that the neighborhood is “up-and-coming.”