The Problem of Scale for Housing Development Projects

Milwaukee       Talking to the housing and economic development people, whether from the government or nonprofits, I kept hitting my head against a ceiling when it came to the thinking about the housing problems.  Looking and thinking about the issues in the Amani neighborhood made this headache unavoidable.

Work with me on this.

In Amani you have a community that within the boundaries drawn by the city and many of the residents has a population of about 8500.  The population is actually increasing there in recent years, which is a question worth contemplating at another time.  There are roughly 1400 properties, and more than 300 are rated by the city as vacant, which is more than one in five properties.  More than 20% of the properties are also tax delinquent.  It goes on and on like this.

Various programs available from the city allow small grants for repairs.  Some other programs fund nonprofits to help finance and rehab houses but often limit them to no more than four per year.  Some are catch-22 situations where to get money to fix a roof, the owner has to have insurance, but insurance companies cancel the owner when they have roof problems.

The math isn’t simple, but it is unforgiving.  If the only problem was rehabbing the vacant homes, and money was available to rehab only fifteen per year, it would take twenty years to bring the existing vacant properties up to snuff.  With more than 70% of the housing stock built before 1939, at a minimum all of those houses would be over 100 years old, so time will not stop, there will be more houses that need rehabilitation, whether occupied or vacant.

Working block by block would be hard as well.  Even doing five houses per block to try to turn a block around, there are 130 blocks in Amani.  One block a year would take twenty-six years, so that would never work.  Even three blocks per year doing fifteen houses would take ten years, and of course time will not stop there either, making housing rehab at this level a Sisyphean project.

Meanwhile the housing valuation is going down, not up, in Amani.  The last evaluation of the assessed value of Amani properties showed a drop of over 4% from $29786 to $28533 or $1253, even going the wrong way compared to inflation.  A low-to-moderate income homeowner looking to borrow $20,000 to rehab their own home from a bank is going to face the problem of putting $20K into a $30K house and finding the valuation for collateral purposes in the Amani market might only move the property to being worth $35,000, not $50,000 making most banks skittish to say the least.

To turn the community around and create a real tipping point, it would seem that organizations and government should be looking at doing 100 houses a year for four or five years.  If the price tag was $20,000 per house that would be $2 million per year or eight to ten million to get it done.  If $30,000, then then $3 million per year, if $40,000 then $4 million per year.  Those are not unmanageable numbers.  That’s a mid-range condo in New York City.  A project that size would raise all boats and the whole neighborhood, because it makes sense.  If such a project only raised the average valuation of the houses from $30,000 to $40,000, that would mean a $14,000,000 bump in the neighborhood and over five years a minimum of $70,000,000 for the housing stock.

If we were downtown or commercial developers, the city and local banks would be standing in line to finance the deal, because the numbers make a difference.  When we’re talking about housing, we are being nickeled-and-dimed, when we need to push to get to scale to stop playing catch up and start getting ahead and making real change.


Getting the Lead out in Milwaukee’s Amani Neighborhood

Milwaukee       If you want to really be helpful in leadership development or organizer training, you can’t just pull a bunch of old training documents off the hard drive, print the agendas, change the dates, plug and play.  If I’m going to do the work for more than an hour or two, I want to first get to know the organization, meet the leaders and core staff, and get to know their challenges of course and their successes and failures.  For their money and my time, I want to really know what issue enrages them and what they dream for the future.  I spent most of a day doing so with ten leaders and two staff members of Amani United and the Dominican Center, so that they could teach me.

I didn’t walk in blind.  I had met a couple of leaders and one organizer late last year when they buttonholed me after “The Organizer” ran at the University of Wisconsin at Milwaukee.  Their invitation coupled with that of Sister Patricia Rogers, the director of the Dominican Center, had brought me back in a typically hard winter January day. I had driven the neighborhood and gone up, down, and around the blocks before I walked into the locked down former St. Leo’s rectory, so I knew it wasn’t a tourist destination for visitors to the city.

I had also found some statistics on the internet about Amani.  I knew 92% of the residents were African-American, that 52% of the community was below the poverty line, that female heads of households ran 48% of the families, that more than a third of the population was unemployed, owned no transportation, and hadn’t gotten a high school diploma, that only 73% of the housing was occupied, that 69% of the community were renters with rental rates 20 to 50% higher than the rest of the city, and that 64% lived in units built before 1939.  So, yes, it was my kind of neighborhood, and on the bright side 99.5% of the registered voters in Amani voted in 2008.  That says something right there about hope and the future.

With this background, listening to the leaders in some ways was not surprising.  Familiar themes around non-performing schools, crime and safety, slumlords, abandoned houses, and vacant lots came up.  Other issues were surprising.  The record checks that prevented parents from being volunteers or visiting their children’s schools because of minor offenses twenty years previous.  The contradictory city regulations that kept financial assistance from fixing roofs because the property lacked insurance because insurance was dropped because the roof needed to be fixed.  The fact that former felons had been blocked from buying homes.

And, then there was lead, and the fact that the neighborhood had been poisoned.  Wisconsin had dominated lead production in the 19th century.  Many home fixtures were dictated to be installed with lead.  The water laterals, meaning the pipes from the house to the street, were all lead until recently.  Lots where children played tested through the roof.  Mothers around the table told of their children being poisoned with no penalties and little abatement.  They told me that the lead levels were worst than Flint, and in the Amani zip code they were twice as high as any other area in the city of Milwaukee.  I kept asking how they knew that but later that night found the chart in a report that showed the whole area as bright red.  Other newspaper reports detailed how Milwaukee had been seen as a leader in lead prevention in 2014 but was dragging its feet now.  There were coalitions galore that had formed to deal with lead, some even included Amani United, but talking to the leaders it was impossible to get the sense that the problem was being solved.

The leaders in Amani got my attention, and the lessons I learned kept me tossing and turning all night long.  The next steps will be making the plan and meeting their demands for the skills they need to fight and win.