Steps to Take in Fighting Gentrification

New Orleans     Talking to Randy Shaw, tenant organizer and lawyer with the Tenderloin Housing Clinic in San Francisco, on Wade’s World about his new book, Generation Priced Out, he mentioned several steps that are worth research and action in cities everywhere facing gentrification.  In fact, he emphasized several times that one of the things that he had learned from his travels around the country in assembling this volume, is that anyone out there who is still singing the song, “it can’t happen here,” is simply smoking their own grow and not looking out the door.

One place where he was more than willing to point the finger was at road blocking of affordable housing that was creating more displacement by neighborhood organizations and the politicians and cities that kowtow to them in blocking multi-unit and higher density construction.  California is a leader in this fight, and Shaw argued that even Los Angeles, long a worshipper of single-family lots, is moving to deal with this issue.  In fact, the State of California sued the 200,000-person coastal city of Huntington Beach, some forty mile south of Los Angeles for trying to restrict zoning laws to prevent density.  He said that Minneapolis also finally moved to change its restricts on higher density.

Shaw argues that every city needs to inventory its unused public lands and make them available for construction of affordable housing as well.  He was especially critical of New York City Mayor DeBlasio’s administration allowing the armory in Crown Heights to be developed for condos in Brooklyn, rather than affordable housing.  In our annual Year End ACORN meeting, it was difficult to suddenly hear that the City of Toronto was making public land available and then claiming that affordable housing built there would be limited on a big project with nonprofit management because the for-profit developer needed to make a killing.  Nonetheless, this is worth a fight.

Giving preference for any housing built in lower income or minority areas undergoing gentrification for a big percentage of the housing to be offered preferentially to local residents so that they would be displaced, also seemed exactly right.  In the meantime, while construction is underway in Toronto, the city assures that every unit lost has to be replaced, and that housing is provided and subsidized to the families while they are out of house and home for the new project.   That rocks!

Inclusionary zoning continues to be key.  Shaw takes an ecumenical view on this issue, which was both interesting and pragmatic.  Essentially his argument was, any level, even a low one, whether a 10, 20 or 30% set aside is still a win, because it makes more affordable housing available than existed before.

Bottom line:  gentrification has to be stopped.  We can’t allow policy makers to join developers in saying it’s inevitable.  There are weapons in this fight, if we organize effectively to force their adoption.

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Real Estate Wealth Taxes as a Anti-Gentrification Tool

New Orleans   Recently I listened to an interview with a prominent local developer on WAMF in New Orleans as he was asked about gentrification.  He tried to walk the line between his self-interest and progressive values.  He was against displacement on one hand, but he opposed inclusionary zoning that would require developers to create affordable units in their properties.  He claimed it would sacrifice three units for every one that it created without mentioning that most of the three units built would be for high-end customers.  He opposed a tax on developments that would fund affordable housing or homeless programs.  He claimed the city and state had no money, so the real solution to gentrification had to be federal.

In some ways his argument was breathtaking in its chutzpah.  He was claiming to believe that gentrification was in some ways a pejorative term for a natural process, while opposing displacement, protecting his self-interest, and at the same time presenting himself as an advocate of a national remedy.  Unsaid was the fact that given our Developer-in-Chief president and the current situation in Congress and HUD, the chance of a federal remedy is much less than that odds Vegas would give a snowball in hell.

Chuck Collins, director of the Program on Inequality at the Institute for Policy Studies, in a commentary in YesMagazine made a much stronger, more realistic case for local action, saying:

Municipalities should move with due haste to enact high-end real estate transfer taxes, requirements for the disclosure of beneficial ownership, and regulations aimed at the disruptive impact absentee-owner-investors are having on our cities.

Collins doesn’t claim this will stop gentrification but makes the case that it will discourage “rapacious global capital” from exacerbating displacement and artificially increasing ownership and rental prices by discouraging the kind of offshore wealth capital “parking” that has been so destructive in Vancouver and London.  As an example, he cites the situation in San Francisco, another favor of “ultra-high net worth individuals” with over $30 million in assets, where voters passed a high-end real estate transfer tax on residential and commercial properties with $5 million price tags and higher.  According to Collins, the tax…

“…the tax expected to generate $44 million a year, which has been allocated to fund free tuition for residents at San Francisco Community College and help pay for the city’s tree maintenance program.”

That’s not the same as building affordable housing, but it’s moving in the right direction.  Furthermore, there’s no reason it could not leverage other funds to construct affordable housing or provide city-based rent subsidies.

We can’t wait for Washington.  We have to act now, and whether a real estate tax on $5 million or $1 million or whatever, if such a tax builds local equity by creating affordable housing or other programs that fight displacement, it’s worth a fight.

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