Tag Archives: affordable housing

Battle in Winnetka over affordable housing plan

Posted on by

The community of Winnetka, Illinois is a northern suburb of Chicago that is quite wealthy: the Census says the median household income is $201,650 (in 2009 inflation-adjusted dollars). The Chicago Tribune reports on a recent debate over a plan to introduce affordable housing to the wealthy suburb:

Winnetka’s plan calls for a land trust to provide for-sale and rental property to those who make far less than the median household income of $201,650.

Under Winnetka’s proposed plan, owner-occupied units must be affordable to households earning at least $75,000. Rentals must be affordable to those earning at least $45,000 or more. Current residents and senior citizens would receive priority.

A lot of suburban communities talk about affordable housing but few propose plans like this. It would be interesting to know how the local government was able to even put this plan forward.

The plan itself describes the change that has occurred in Winnetka over recent years as the community has become even more exclusive:

Over the past several decades, Winnetka has become less diverse in age and income, and it contains a more transient population, according to the plan. The report states that Winnetka lost much of its housing market diversity with the demolition of older, smaller homes that were replaced with larger, more expensive houses. Between 1980 and 2000, the village also lost 262 rental units — a 38 percent reduction — due to the conversion of downtown apartments into commercial offices.

Between 1990 and 2000, the number of homes valued at less than $500,000 declined to 975 from 2,004, according to the report.

“Winnetka’s housing stock increasingly serves only one kind of resident — a family at the peak of its earning years and with school-age children,” the report states.

It sounds like teardowns have become quite an issue.

There has been some vocal opposition to the plan:

“There is plenty of affordable housing in neighboring communities,” said Carry Buck, chairman of WHOA, or Winnetka Home Owners Association. “Most people in Winnetka are conservative and they do not want more involvement from government.”

In a 25-page publication mailed to Winnetka residents last week, the homeowners association called the village Plan Commission’s proposal un-American, predicting it will lower property values, attract criminals and force residents to subsidize those who rely on “hand-outs.”

While this language might be more blunt than what one might typically find in such NIMBY debates, there are plenty of suburbanites who hold such views. Anything that might lower property values or might detract from the community that they bought into is seen as a threat.

The Tribune story suggests that an interfaith group is on the other side of the debate:

The lightning rod for complaints is the Interfaith Housing Center of the Northern Suburbs, a Winnetka-based nonprofit that supports the plan. The center, which advocates for fair and affordable housing and investigates housing discrimination complaints, is accused by WHOA of infiltrating village boards and commissions with “social engineers” who depend on federal funding.

Interfaith’s executive director, Gail Schechter, described the opposing arguments as absurd.

“Social engineering is what got us to look the way we do,” she said. “The way Winnetka looks today is not just pure market forces.”

Sociologists would tend to fall on this side: the suburbs were not just created by people voting with their dollars and feet. Rather, the whole suburban system is upheld by a massive system of government policy (building highways, promoting homeownership, tax breaks or incentives for developers and those with financial resourcse) and cultural values (emphasis on the single-family home and automobiles, an anti-urban bias, a desire to move away from problematic areas, etc.).

It will be interesting to see how this plays out. In my own research on suburban communities, I found such open debates (where each side clearly lays out their intentions and/or fears) to be relatively rare. Additionally, such debates are rarely just about particular development proposals; rather, they are about the broader character of the community. Here, it sounds like the debate is also about the image and status of Winnetka: is it just a upper-class suburb or should it be something different?

A-Rod real estate tax flap tied to incentive to construct affordable housing

Posted on by

It appears that a number of luxury housing owners in New York City, including Yankees’ star Alex Rodriguez, are getting a major real estate tax break. While this is creating a stir, there is more to this story: these luxury units are getting a tax break because the developers have promised to build affordable housing elsewhere in the city.

Rodriguez and all the residents of his posh high rise will get tax breaks for 10 years under the city’s 421A tax abatement program. Luxury developers get tax breaks in exchange for making sure affordable units get built elsewhere. Rodriguez is one of some 45,000 New Yorkers who have scored the tax break.

“I think it’s outrageous,” Lewton said.

When Rodriguez’s moves into his $6 million, five-bedroom penthouse his tax bill will be $1,150. In contrast, Stephen and Phyllis Franciosa pay $3,100 in taxes one their one-family home in the Pelham Bay section of the Bronx…

The councilman said the law needs to be changed because this year alone the program will cost the city $900 million in lost revenue.

A-Rod’s taxes are so low that if he paid the going rate his tax bill would be 50 times higher. He should get such a break when he faces the Red Sox pitching staff.

City officials claim the tax breaks on Rodriguez’ building helped build over 575 units of affordable housing in the Bronx.

This is not an uncommon tactic for communities to encourage affordable housing: grant some tax breaks in exchange for the builder or developer constructing some units of affordable housing. It is often a struggle to get developers and builders to construct affordable units on their own as profit margins are lower. So communities have searched for incentives that would still allow builders to make their money while also providing for the public good.

In the long run, will this story simply be commentary about how the rich and famous get to play by different rules (and New York loves to pick on A-Rod) or can there be a reasonable discussion about how cities go about promoting affordable housing? I am guessing that the first option will easily win out. Why can’t New York news organizations go to those 575 units of affordable housing in the Bronx and talk to the other people who benefited from this tax break?

Lake Forest debates affordable housing

Posted on by

Lake Forest, Illinois is one wealthy suburb: according to the latest Census estimates, the suburb of 18,757 people has a median household income of $139,765 and owner-occupied homes are worth a median value of $900,000. The Chicago Tribune reports on some recent arguments over a small affordable housing project in the suburb – note, the suburb currently has about 7,188 housing units and one existing affording housing project with 5 units:

Five years ago, Lake Forest created an affordable-housing plan, acknowledging that high property values in the community were shutting out some seniors, families and education and health care workers, people who are “part of the fabric of daily life in Lake Forest,” from homeownership.

Almost two years ago, the city began working with the Lake County Residential Development Corp. to come up with a plan to construct affordable housing on less than 3 acres of city-owned land.

Last month, the City Council voted down the Settler’s Green project and directed its housing trust to modify the plan, which would have brought one market-rate and 15 affordable single-family rental homes to the northwest corner of Everett and Telegraph roads. In doing so, Lake Forest walked away from $6 million in Illinois Affordable Housing Tax Credits.

On one hand, it is good that the community is thinking about this issue. On the other hand, when push comes to shove in terms of approving even a small project on just 3 acres of land with 15 affordable housing units, people do not want the project. Additionally, the affordable housing project seems to have been aimed not at lower-income or minority residents but rather at “some seniors, families and education and health care workers.”

Some other figures suggest that Lake Forest needs more than just 5 units of affordable housing – there are plenty of workers in the area who make little money but need housing:

Last year, in a presentation to the Metropolitan Planning Council, Morsch noted that more than two-thirds of the work force in Lake Forest, Highland Park, Northbrook, Deerfield and Highwood earns less than $50,000 a year, meaning they can afford only 3 percent of the local housing stock.

It would be easy to categorize this as another case of NIMBY where citizens in the well-off community just don’t want land to be used in a way that is inconsistent with what already exists. But, this is not just an issue in Lake Forest. There are some deeper issues involving social class and race embedded in this issue of affordable housing in the suburbs.

Another consequence of financial crunch: public housing repairs

Posted on by

The New York Times reports that public housing repairs have fallen even more behind due to the financial crunch affecting many governmental bodies: “Public housing is falling apart around the country, as federal money has been unable to keep up with the repair needs of buildings more than half a century old.”

While the story goes on to address particular cases in Baltimore and New York City, it’s hard to know from the story about how much of an issue this is. How much worse is the issue compared to five years ago? The only figure cited about a national figure for repairs was derived from a 1998 study. In Chicago over the last few decades, public housing repairs were frequently behind and more funding was requested even when economic times were good.

Keeping the elderly in their hometowns

Posted on by

The USA Today reports on efforts by communities to help the elderly grow old in their hometowns. These communities have built “villages” where services for the elderly are coordinated. According to the article:

More than 50 villages in a neighbor-helping-neighbor system have sprouted in the past decade from California and Colorado to Nebraska and Massachusetts. They are run largely by volunteers and funded by grants and membership fees to provide services from transportation and grocery delivery to home repairs and dog walking…

AARP research shows that 90% of people want to grow old in their home and community.

This would seem to be wise for communities: the elderly know many useful things about a community, have made many connections among residents, and can teach and mentor a younger generation. Communities and suburbs without elderly residents are missing a key piece of their own social fabric.

In the Chicago area, when suburbs talk about “affordable housing,” they are not always talking about housing for low-income residents. They are often referring to programs that would help the elderly remain in places where costs of living make it difficult for residents to live on limited incomes.