Twenty years ago Pasadena city officials were concerned about the over concentration of poverty in Northwest Pasadena, and crafted an inclusionary ordinance that prohibits "over concentrating" affordable housing. This policy is obsolete and should be sun-set. Northwest Pasadena has historically been low-income and largely African American, but it is now gentrifying. Home prices in Northwest average around $800,000 and 24% of Pasadena's African American population has left the city, many of them from Northwest Pasadena. NW Pasadena meets the definition of a gentrifying, not a segregated neighborhood.
Nonetheless, some of our Council members like to cite the HUD policy on over concentration of affordable housing in segregated low-income areas as a reason not to build more affordable housing in this part of the city. The HUD policy on over concentration is based on studies that show that people segregated in high-poverty areas generally do better when they move to low-poverty areas. Their children have access to better schools and their chances of success improve. This strategy works best when the city has an overall policy of scattered affordable housing to address segregation, as described in this article from Wikipedia. The approach taken by Chicago has been used successfully in other cities:
The class-action lawsuit of Gautreaux v. CHA (1966) made Chicago the first city to mandate scattered-site housing as a way to desegregate neighborhoods. Dorothy Gautreaux argued that the Chicago Housing Authority discriminated based on race in its public housing policy. The case went to Supreme Court as Hills v. Gautreaux and the 1976 verdict mandated scattered-site housing for residents currently living in public housing in impoverished neighborhoods.
Since that time, scattered-site housing has become a major part of public housing in Chicago. In 2000, the Chicago Housing Authority created the Plan for Transformation designed to not only improve the structural aspects of public housing but to also "build and strengthen communities by integrating public housing and its leaseholders into the larger social, economic, and physical fabric of Chicago". The goal is to have 25,000 new or remodeled units, and to have these units indistinguishable from surrounding housing. While properly run scattered-site public housing units greatly improve the quality of life of the tenants, abandoned and decrepit units foster crime and perpetuate poverty. The Chicago Housing Authority began demolishing units deemed unsafe, but the Plan for Transformation set aside $77 million to clean up sites not demolished in this process.
Gentrification, Displacement and Affordable Housing
Over the past twenty or so years, however, a new problem has arisen as cities have become less segregated due to gentrification. As middle class, mostly white people have moved into low-income neighborhoods that have historically been predominantly African American, this has led to rising rents and housing prices, which have benefited some and disadvantaged others.
A Harvard study on gentrification notes that, as the demand for housing has exceeds the supply, low-income residents of gentrifying areas have been priced out and generally move to lower-income areas, thereby perpetuating the cycle of poverty. Gentrifying neighborhoods become less diverse racially and economically. Here is what the Harvard study recommends to counter this tendency:
So, what can policymakers and community organizations do to secure long-run economic diversity and help make gentrifying neighborhoods more inclusive, or more welcoming to households earning a range of incomes? There are no easy answers, but one relatively simple, if potentially expensive, response is to preserve the substantial stock of affordable housing that already exists in gentrifying areas.
Consider the case of New York City, where 12 percent of housing units in gentrifying areas of the city are public housing units and roughly another quarter are privately-owned subsidized housing. If preserved over time, these units can assure some level of economic mixing, and potentially racial mixing too. Preserving public housing is the most straightforward measure, though many public housing units need substantial infusions of capital.
Finally, building truly inclusive and integrated communities may require more than just housing investments. It may take special efforts to knit a community together and ensure that all residents are able to enjoy a neighborhood’s amenities and resources. Local community organizations are perhaps best equipped to break down the social, and sometimes physical, barriers that sometimes separate public and other subsidized housing residents from their neighbors and ensure that all residents in a community have a voice and gain from any new opportunities.7 In sum, gentrification offers the promise of inclusivity. But left to its own devices, the market is unlikely to deliver on that promise.
To ensure longer-run integration, local leaders in partnership with community-based organizations can work hard to preserve existing affordable housing (through investing in public housing, extending affordability restrictions on privately owned units, and seeking opportunities to incentivize private owners to keep units affordable over time).
Second, they can take advantage of publicly owned land and other opportunities to acquire and create new subsidized housing in neighborhoods experiencing market pressures.
Third, they can harness the market to deliver affordable units through tools like inclusionary zoning. Finally, they can work with local community groups to help low- and moderate- income residents make the most of any growing opportunities arising in gentrifying neighborhoods. Of course none of this is easy, and none of this is cheap. Some deals will simply be too expensive, but city and community leaders who wish to make gentrification more inclusive should be vigilant in searching for opportunities. And meanwhile, researchers should be on the lookout for opportunities to build our understanding of the costs and benefits of different strategies.