Decommodifying Housing Without Reproducing American Apartheid

Though the idea of social housing is gaining traction among advocates and policy experts, the path of least resistance for its production in the U.S. is also the path of the perpetuation of residential racial segregation.

chain link fence skyline
Chain Link Skyline. Photo by a. via flickr, CC BY-NC-ND 2.0

One of the ironies of housing justice work in 2018 is that, while a deeply hostile and incompetent federal administration plots the destruction of the housing safety net, the range of what is politically possible for policies to meet the United States’ housing needs has moved sharply to the left.

After decades of focus on tax credits, vouchers, and inclusionary zoning, organizers and policy experts are shifting focus toward direct, public, or collective control of homes. The vehicles for this sort of development include community land trusts and public housing, both of which fall under the broader umbrella of social housing. It turns out that aspirations for taking the market out of housing provision were not reduced to rubble with the Pruitt-Igoe Towers in St. Louis in 1972.

As it increasingly influences housing policy, this turn is apt to cause no small amount of agita among civil rights advocates who have long fought to remedy the continuing effects of deliberate residential racial segregation. After all, federally sponsored racism permeated public housing with regard to its occupancy, location, and maintenance. Although residents managed to forge strong communities, much of what public housing authorities across the country produced in the wake of the National Housing Act of 1949 isolated residents from decent jobs, quality education, and basic health and safety. Why then would this society want to recreate those conditions?

The answer should be that it would be different this time around—in producing social housing that honors the fundamental right of all to a decent home, we will also respect the fundamental rights to education, health and safety, a living wage, and freedom from discrimination. There is, however, a substantial risk of those being empty words as the path of least resistance for social housing production in the U.S. is also the path of the perpetuation of residential racial segregation. At the same time, by understanding the structural reasons why that is the case, the opportunities to exploit gaps and fissures in those structures, and how segregation would threaten the sustainability of social housing, it is possible to build a case for racially integrated housing as a public good.

The Path of Least Resistance: Land Availability, Land Costs, and Political Will

In the absence of concerted action, three principal factors are likely to steer decommodified housing to low-income communities of color where residents are disproportionately isolated from decent jobs, quality schools, and basic health and safety. First, it typically seems as if developable land where construction would not fuel sprawl is concentrated in or adjacent to low-income communities of color. Second, acquisition costs for privately owned land are likely to be lower in those very same places. Third, over the long haul, local governments in disproportionately black and Latino central cities and inner ring suburbs, rather than heavily white, affluent suburbs, are more likely to have the political will to invest significant resources in the production of social housing.

The Location of Developable Land

When selecting sites for the production of new housing, regardless of affordability, two categories of land tend to appear be the commonsense choice: land within the developed portion of a metropolitan region that has fallen into disuse, and undeveloped greenfields at the periphery of metropolitan regions. The former type of land, which can be industrial, residential, or commercial, tends to be located in or near low-income communities of color in central cities and declining inner-ring suburbs because of disinvestment and deindustrialization.

Formerly industrial land is often located in close proximity to logistical infrastructure such as rail hubs and ports and communities of color that often had no or lax zoning requirements. For residential land in particular, deliberate underinvestment in maintenance by absentee property owners and the discriminatory lending practices of financial institutions have played significant roles in increasing vacancy. By contrast, with some exceptions, greenfields are more likely to be located in predominantly white areas, but prioritizing development in those areas often has adverse environmental implications.

Areas with brownfields and housing that has deteriorated as a result of disinvestment offer some tradeoffs with respect to access to opportunity. On the one hand, access to high-performing schools and healthy environmental conditions is usually limited, while, on the other, proximity to job centers is sometimes greater and transit access is usually better. The dimensions of opportunity that are most beneficial to individuals or families may vary based on each household’s individual characteristics, with young children benefitting more from access to high-performing schools and young adults without children benefitting more from access to transportation and jobs.

The Cost of Land

Closely related to the availability of developable land is the cost of land. Controlling for current zoning regulations, land tends to be most expensive in affluent, predominantly white areas. There are partial exceptions to this norm in cities undergoing rapid gentrification, but any strategy to foster residential racial integration in decommodified housing will need to account for this obstacle. Patterns in ownership of land by public entities and public-spirited nonprofit organizations, such as religious congregations, exacerbate the problem.

In comparison to suburban municipalities, big city local governments are more likely to own land and to own it for a wider variety of purposes rather than just the more typical schools, parks, and emergency services. The greater the inventory a government holds, the more frequently a building will become obsolete, thus creating opportunities for adaptive reuse as social housing. Additionally, because of the pernicious effects of lending discrimination and broader economic insecurity as well as a lack of competition from private actors to purchase land, big city local governments are more likely to own individual small lots and structures through tax foreclosure.

The geographic distribution of land owned by nonprofit institutions that might have a mission-related motivation for contributing to social housing production is also skewed. Nonprofit service providers and advocacy organizations located in big cities may have surplus land. The location of religious institutions is more widely distributed, but land that is available for reuse is likely to be disproportionately located in big cities, both due to the relative age of physical structures and relocation by congregants. Accordingly, neither public land nor nonprofit institutional land is likely to offer a way out of the problem posed by higher land costs in affluent, predominantly white areas.

Racism and Political Will

It should also come as no surprise that affluent, predominantly white suburban communities are less likely to be supportive of the production of social housing within their boundaries than are big cities. Opposition occurring even within big cities tends to be concentrated in affluent, predominantly white neighborhoods rather than in low-income communities of color.

To the extent that it influences government actors, this predicable opposition has adverse implications for the donation of public land, zoning and land use approvals, and commitment of public funds to pay for acquisition and construction. Even if local politicians accept the case for social housing production, community opponents may have an effective veto over some bond financing necessary for development by way of the ballot box.

Identifying and Exploiting Gaps in Exclusionary Structures

The foregoing case for why building decommodified housing in low-income communities of color is the path of least resistance is a bit of a straw man and intentionally so. Closer scrutiny reveals that for each of the problems above—the availability of affordable, developable land and racially motivated community opposition—there are either exceptions to the rule or workarounds that diminish the significance of the problem. Understanding these problems can drive the field to engage in the creative, visionary thinking needed to avoid the reproduction of residential racial segregation.

The Land Is There When You Look For It

With respect to the availability of developable land, the overview above does not address how certain extant land uses that are concentrated in affluent, predominantly white suburbs are rapidly becoming obsolete. In 2017, Credit Suisse estimated that 20-25 percent of U.S. shopping malls would close by 2022. These shopping centers are spread across suburban areas, and, although it may be reasonable to expect closures to hit diverse inner-ring suburbs the hardest, the shuttering of some malls in historically exclusionary areas across many metropolitan areas is a near-inevitability.

Additionally, among malls that may be able to survive the proliferation of e-commerce, many are undergoing dramatic renovations along the “Town Center” model, which invites the inclusion of housing as part of a New Urbanist-inspired drive to create walkable mixed-use communities.

Along similar lines, the U.S. is likely to see the closure of a significant number of golf courses across metropolitan regions in upcoming years. According to a study by Pellucid Corp., an industry group, there was an over 30 percent reduction in the number of regular golfers in the U.S. between 2002 and 2016. To an even greater extent than with respect to shopping malls, golf courses are concentrated in affluent, predominantly white suburban areas. These broad swaths of land present an opportunity for decommodified housing production for which there arguably is no parallel in low-income communities of color.

A final and more controversial source of developable land in affluent, predominantly white suburbs consists of the ubiquitous subdivisions that line these communities. Nassau County, New York is one of the foundational proving grounds for residential racial segregation in the U.S. The Town of Oyster Bay includes the most exclusionary areas, where roughly two-thirds of the housing units were built prior to 1960, and only about one in thirteen have been built since 1990. Older housing units in Oyster Bay tend to be relatively poorly constructed post-World War II homes. Although homeowners in places like Oyster Bay may have greater access to affordable home equity and refinance loans, there is very little architectural significance or expectation of high future demand that would prevent the reuse of this land.

If Government Is an Active Partner, Cost Containment Is Feasible

The conventional wisdom that land costs are higher in affluent, predominantly white areas is belied by the ways in which existing zoning controls intersect with cost. It is certainly true that in most metropolitan regions, the cost of land per unit of allowable density is most affordable in low-income communities. At the same time, it is also often true that the per-acre cost of land is actually lower in exclusionary suburbs. Government has the power to increase allowable density.

Typically, this would increase the value of the land that is upzoned, partially undermining the power of upzoning to decrease disparities in land costs between affluent suburbs and low-income cities and inner-ring suburbs. However, if the government assumes ownership of the land prior to upzoning (whether through property tax foreclosure, eminent domain, or consensual sale), it should be able to do so at a price point that reflects the value of the property at the lower density.

Though municipalities could similarly acquire higher density land in low-income communities of color and facilitate social housing development that is yet more dense, that practice could not match the gains in value added from suburban areas because the gap between the original density and the density of what is built would be smaller.

If the community land trust model, which does not necessarily require government support, is the dominant model of social housing production, the difficulty in overcoming higher per-unit land costs in affluent, predominantly white areas is not so easily solved. Unlike a local government producing housing directly, a community land trust, which owns land subject to deed restrictions and leases individual homes to low-income households for an extended period, typically 99 years, does not have zoning authority, and, unlike many municipalities, it does not have the power to simply ignore land use regulations when acting as a land user. That does not, however, mean that community land trusts are without options for precipitating the upzoning of land in suburban areas.

The federal Fair Housing Act has long offered an underused tool for attacking exclusionary zoning through litigation. The Fair Housing Act prohibits policies and practices that have unjustified discriminatory effects in addition to intentional discrimination. Since exclusionary zoning tends to have a disparate impact on Black and Latino households, the practice is often a violation. The primary reason why the threat of Fair Housing Act enforcement has not had as much of a deterrent effect as would be ideal is that it is very difficult to bring such cases unless a developer makes a failed attempt to secure a zoning change. Developers in the commodified market, both for-profit and nonprofit, generally are not inclined to take on the pre-development costs, lengthy process, and uncertain outcome that accompany such efforts. These deterrents should not be as determinative for mission-driven community land trusts.

Additionally, proponents of social housing production can advocate for policies that return land use regulatory authority in affluent, predominantly white suburbs from the local level to the state, which may be a friendly forum for upzoning attempts. New Jersey’s Fair Housing Act and Massachusetts’ Chapter 40B law both provide examples of how to achieve this.

The extent to which this is a realistic prospect will vary by state. It is hard to imagine state legislatures that have purposefully preempted local inclusionary zoning, like Tennessee or Indiana, forwarding affirmative legislation to undercut exclusionary zoning. At the same time, in order to overcome preemptive tax and expenditure limits that would prevent municipalities from adequately funding social housing and to beat back attempts by the real estate industry to stymie social housing, advocates will inevitably have to build power that can be exercised in currently unfriendly state legislatures and governors’ mansions.

Although it is difficult to imagine with the current administration and Congress, the federal government can also play a role through enforcement by the U.S. Department of Housing and Urban Development of its grantee local governments’ duty to take proactive steps to foster residential integration or through legislation like that recently introduced by Senator Elizabeth Warren that would incentivize exclusionary local governments to adopt more inclusive zoning.

Confronting Racism with Hard and Soft Power

The litigation-based approach to lowering land costs for community land trusts in high opportunity areas discussed above also represents the most direct, albeit lengthy, way of reducing the role of racism in the siting of social housing. Smaller variations on the same theme of transferring power from local governments that are captive to the exclusionary interests of their constituents to institutions like state administrative agencies, state and federal courts, and regional or county governmental bodies also hold promise. Alliances between low-income communities of color and mostly white, middle-income suburbs that are straining under the weight of unsustainable costs because of municipal fragmentation could advance such policies.

Other state policies that could further common interests and cement the durability of an urban-suburban coalition include mechanisms for pooling property tax revenues regionally, laws that make annexation easier, and ones that make further incorporation of new municipalities and school districts more difficult.

Proponents of social housing can also make the affirmative case for why such development is in the best interests of nearly all segments of metropolitan society. In essence, advocates would seek to pit individuals and families up to the 90th percentile of household income (and perhaps the 98th) against economic elites. Although those in the top 10 percent (but not the 1 percent) have a different lived experience than the working class, there is a growing recognition that, in an era of intense and growing income inequality, their interests are increasingly more aligned with the working class.

While many upper-middle-class families saw their home equity and retirement savings wiped out by the Great Recession, they did not benefit from the golden parachutes provided to executives and institutional shareholders of financial services firms. Even if they rebounded more easily than working class people, their experience with the trauma that speculation-driven instability in the housing market predictably causes could lead them to view social housing as a bulwark of security.

The nationwide housing affordability crisis and generational shifts in preferences for denser housing also have the potential to play constructive roles. The shift toward deliberately socioeconomically integrated social housing with quality amenities, like that in Vienna, Austria, is a partial answer to the question of whether social housing can really be “for” the upper-middle class.

It is only a partial answer because there are other structural factors that might make the speculative housing market continue to seem like a better bet for those in the top 10 percent by household income. Though to a lesser extent than before passage of the 2017 tax bill, the federal tax code still incentivizes homeownership free from equity accumulation restrictions as a means for accumulating wealth and retirement security. Additionally, in the wake of a large-scale retreat from defined-benefit pensions and in light of Congress’s continuing failure to increase Social Security benefits, there are ever-decreasing alternatives for achieving retirement security.

Although an upper-middle-class family may spend less of their income on housing costs if they reside in decommodified housing, the options of increasing their 401(k) contributions or independently playing the stock market may seem both less fruitful and more dangerous than continued participation in the speculative housing market. Thus, the indirect strategy of advancing retirement security by increasing Social Security benefits, requiring employers to offer defined benefit pensions, or both, would help push upper-middle-class families toward acceptance of decommodified housing as a good of value to them specifically.

The fundamental goal must be to engender the perception that social housing is a universal social good that, though it may provide disproportionate benefits to poor and working class people, helps all people regardless of income and wealth. This articulation of the goal illustrates why the adoption of certain established practices for diffusing opposition to affordable housing in affluent, predominantly white areas would be harmful. Chief among these are residency preferences or requirements, which may violate the Fair Housing Act and that limit (in part or in whole) occupancy to households that live or work in the community in which the housing is located. Although such policies may facilitate the broad spatial dispersion of social housing, that distribution would not signify residential racial integration if people of color cannot reside in housing in predominantly white areas in practice.

Additionally, whether through admissions preferences or targeted marketing to specific groups, a disproportionate focus on housing for seniors seeking to downsize and young people seeking to establish themselves come at the expense of housing families with children and thus could neutralize the integrative effect of social housing in predominantly white areas. Although stressing the needs of elders and young people who are from affluent, predominantly white communities may be an important part of the narrative as to why such housing is in the interest of residents, that should not translate into the actual exclusion of low-income people of color moving to those areas.

Ensuring the Stability and Soundness of Decommodified Housing

Although the imperative to take strategic action to ensure racial integration in social housing on civil rights grounds is clear, the relation between integration and the long-term stability of social housing is nearly as significant. One of the principal reasons why public housing in the U.S. is widely perceived as a failure is that it was chronically underfunded, leading to a spiral of habitability issues, increasing vacancies, and reduced revenue from rents. The lack of broad public support underlying that underfunding was, in part, the product of the racially biased perception that public housing was “for” a specific marginalized population and that others had little or no interest in its effective operation. By expanding the base of people who believe that social housing is “for” them and people close to them, it may be possible to prevent the reproduction of that pattern.

Another closely connected reason for the deterioration of public housing was that, contrary to some initial aspirations, deep income targeting led to a preponderance of extremely low-income residents. In 1999, at the beginning of the years-long process of demolishing the Robert Taylor Homes, just 15 percent of Chicago Housing Authority residents were employed, and the average head of household had an income of $10,000. The amount of rent that a housing provider can collect from extremely poor households is much less than can be obtained even by moving slightly up the income scale.

That lack of revenue played a complementary role to that of insufficient government appropriations for maintenance and operations. If upper-middle class households can be drawn into social housing, that occupancy could play a similar role to the one it plays in private market housing featuring inclusionary set-asides of affordable units, effectively cross-subsidizing the residency of low-income households.

A perhaps underappreciated benefit of efforts to avoid the concentration of social housing in low-income communities of color is that doing so would free up vacant and underutilized land to meet local needs that may actually be more pressing than the need for shelter.

Racial disparities in access to amenities like green space, recreational facilities, and retail options that meet community needs like grocery stores, pharmacies, and hardware stores are products of racial segregation and subsequent neighborhood disinvestment. Making use of available land to fill gaps and reduce disparities in access may prove to be of more benefit than producing social housing locally.

As illustrated by a recent study in the Journal of the American Medical Association, converting vacant city lots into green space can improve the mental health of neighborhood residents. In the best case scenario, reducing the pressures that would tend to undercut the accrual of these types of benefits can be the result of prioritizing racial integration as a goal in social housing programs.

Social housing should be the future of housing in the U.S. True racial and economic justice depend on it. At the same time, the past track record of public housing in the U.S. has been one of stark racial segregation that has far-reaching negative consequences. There is a substantial risk that contemporary social housing efforts will reproduce those outcomes, but there are several windows of opportunity for orienting production toward racial integration as a core value. Doing so should enhance the long-term sustainability of social housing efforts and maximize the benefits of housing and broader community development efforts for residents of low-income communities of color.

2 COMMENTS

  1. Thomas, Great piece. I really like the idea of failing malls becoming an access point for housing integration. Can you explain your suggestion that Land Trusts would find it easier to “take on the pre-development costs, lengthy process, and uncertain outcome” associated with Fair Housing Act Enforcement driven projects? I would think that nonprofit land trusts would face the same concerns as any other nonprofit developer?

    • Rick, good catch. I think it is a matter of degree (naturally), but I’d point to two distinctions. First, hopefully without getting myself into trouble, I’d observe that mission-orientation among non-profit developers is a somewhat variable concept. Obviously, many non-profit developers are strongly committed to their missions, but that isn’t a given (look at the 990s). In the CLT world, I would say, without any data to back it up, that mission-orientation appears to be stronger, both in terms of intensity and consistency across the groups that exist. Aspirationally, I’m also envisioning the emergence of CLTs rooted in high-opportunity suburbs. If their mission is going to be not only to build permanently affordable housing in a way that advances racial justice but to do so in a particular place where it is difficult to do that work, they’re going to have an incentive to stick it out.

      Second and perhaps more to the point, the article is silent on how CLTs are likely to be able to fund their developments, but an assumption is that, as compared to non-profit developers more broadly, they are less likely to be dependent upon streams of funding that have rules, whether federally or via state housing finance authorities, that penalize developers for projects taking longer than anticipated like LIHTC. If CLTs are cobbling together resources from housing trust funds and philanthropic donations, those disbursing those funds may be a little more tolerant of delay. This is obviously a relative matter, as well.

      Of course, CLTs currently have far too little access to the financial resources needed to develop right now, and that’s a real problem, as well.

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