NYC Housing Authority's Alfred E. Smith Houses, lower Manhattan. Photo by Ken Lund.The NAACP and other advocates in favor of more federally subsidized low-income housing to be built in affluent areas may have a case of buyer’s remorse after winning an unexpected Supreme Court victory last month.
If the court’s ruling ultimately fosters greater racial integration in housing patterns, it is apt to do so at a significant cost: less housing overall.
That is because of two simple facts. One is that there is a finite number of dollars available for housing subsidies. The other is that property in affluent areas usually costs more than in poorer neighborhoods.
If the government wants to buy or build housing for low-income families, and especially if those families are disproportionately racial or ethnic minorities (as is the case in many, though not all, areas of the country), then the way to get the most housing per dollar spent is to put that money to work in the neighborhoods where the target population already lives. This also makes it easier for people to decide to move into the new housing, since they need not sacrifice ties to their existing communities. This is the model on which most publicly subsidized housing has been built since World War II.
But it has the real, though generally unintended, consequence of extending the pattern of segregated housing that arose when many white residents abandoned inner cities decades ago and practices like redlining made housing integration difficult for black families in many areas. Though some of the population that originally left for the suburbs has returned to urban cores in a process of gentrification, gentrification and low-income housing tend not to occur concurrently in the same place - because gentrification, by definition, pushes property costs higher.
In legal parlance, housing policy has a disparate impact on minorities - though you could argue that it only has that impact on poorer minorities, since upper- and upper-middle class people of all ethnicities are increasingly prone to live together. Disputes earlier this year in Minnesota and Connecticut demonstrate that concerns about disparate impact and housing are not regionally isolated, but a case in Texas was the one that got the Supreme Court to finally weigh in.
Housing advocates first saw victory when the Supreme Court ruled, counter to many expectations, that claimants can bring disparate impact challenges under the Fair Housing Act. The ruling in Texas Department of Housing v. Inclusive Communities Project effectively established that disparate impact considerations are encompassed in the equal opportunity protections extended by the 1968 law. Perhaps unsurprisingly, the initial reaction focused on the ways in which the decision might help dismantle racial and economic housing segregation. Sherrilyn Ifill, the NAACP Legal Defense Fund president and director-counsel, said in a statement, “Today’s ruling signals a continuing commitment to equality will benefit future generations to come.”
But now housing advocates are starting to see the practical problem: We can make the government spend its housing dollars in more affluent areas, but it is going to provide less housing if it does.
In New York City, for instance, Mayor Bill de Blasio’s long-term affordable housing plans may face challenges under the new standard. In order to make the most of available subsides, the city has long focused on building affordable apartment buildings in areas where land is relatively inexpensive, such as the Bronx or eastern Brooklyn. But now that the Court has determined that policies that further segregation, even unintentionally, are unacceptable, it is possible that cities like New York will have to build fewer units in higher-income areas in order to meet the newly defined set of expectations.
Maybe this result represents a decent trade-off. There is a school of thought that holds low-income families are actually better off leaving poor neighborhoods for locales that offer superior schools and more job opportunities. It makes a lot of sense to me, and I am certain that at least in individual cases it holds true, though the overall statistical evidence seems to be mixed.
But even supporters of the recent Fair Housing decision acknowledge that chronic multi-generation poverty is a problem with many causes, and changing the location in which one sleeps or the skin color of one’s neighbors will not be enough to solve it. So it might make a lot more sense to keep providing as much quality housing to as many households as possible while attacking poverty’s other causes, such as lack of job opportunities, inferior education, impediments to stable family structure, and government policies and programs that actually operate to discourage low-income work.
These changes, too, would have a disparate impact, but it would be a good one, on exactly the people we want to help climb out of poverty forever. It is hard to see how providing less housing, but providing it in different places, can measure up as a strategy for progress. Yet that is the approach housing advocates implicitly said they wanted. Now it may be the one they get.
Posted by Larry M. Elkin, CPA, CFP®
NYC Housing Authority's Alfred E. Smith Houses, lower Manhattan. Photo by Ken Lund.
The NAACP and other advocates in favor of more federally subsidized low-income housing to be built in affluent areas may have a case of buyer’s remorse after winning an unexpected Supreme Court victory last month.
If the court’s ruling ultimately fosters greater racial integration in housing patterns, it is apt to do so at a significant cost: less housing overall.
That is because of two simple facts. One is that there is a finite number of dollars available for housing subsidies. The other is that property in affluent areas usually costs more than in poorer neighborhoods.
If the government wants to buy or build housing for low-income families, and especially if those families are disproportionately racial or ethnic minorities (as is the case in many, though not all, areas of the country), then the way to get the most housing per dollar spent is to put that money to work in the neighborhoods where the target population already lives. This also makes it easier for people to decide to move into the new housing, since they need not sacrifice ties to their existing communities. This is the model on which most publicly subsidized housing has been built since World War II.
But it has the real, though generally unintended, consequence of extending the pattern of segregated housing that arose when many white residents abandoned inner cities decades ago and practices like redlining made housing integration difficult for black families in many areas. Though some of the population that originally left for the suburbs has returned to urban cores in a process of gentrification, gentrification and low-income housing tend not to occur concurrently in the same place - because gentrification, by definition, pushes property costs higher.
In legal parlance, housing policy has a disparate impact on minorities - though you could argue that it only has that impact on poorer minorities, since upper- and upper-middle class people of all ethnicities are increasingly prone to live together. Disputes earlier this year in Minnesota and Connecticut demonstrate that concerns about disparate impact and housing are not regionally isolated, but a case in Texas was the one that got the Supreme Court to finally weigh in.
Housing advocates first saw victory when the Supreme Court ruled, counter to many expectations, that claimants can bring disparate impact challenges under the Fair Housing Act. The ruling in Texas Department of Housing v. Inclusive Communities Project effectively established that disparate impact considerations are encompassed in the equal opportunity protections extended by the 1968 law. Perhaps unsurprisingly, the initial reaction focused on the ways in which the decision might help dismantle racial and economic housing segregation. Sherrilyn Ifill, the NAACP Legal Defense Fund president and director-counsel, said in a statement, “Today’s ruling signals a continuing commitment to equality will benefit future generations to come.”
But now housing advocates are starting to see the practical problem: We can make the government spend its housing dollars in more affluent areas, but it is going to provide less housing if it does.
In New York City, for instance, Mayor Bill de Blasio’s long-term affordable housing plans may face challenges under the new standard. In order to make the most of available subsides, the city has long focused on building affordable apartment buildings in areas where land is relatively inexpensive, such as the Bronx or eastern Brooklyn. But now that the Court has determined that policies that further segregation, even unintentionally, are unacceptable, it is possible that cities like New York will have to build fewer units in higher-income areas in order to meet the newly defined set of expectations.
Maybe this result represents a decent trade-off. There is a school of thought that holds low-income families are actually better off leaving poor neighborhoods for locales that offer superior schools and more job opportunities. It makes a lot of sense to me, and I am certain that at least in individual cases it holds true, though the overall statistical evidence seems to be mixed.
But even supporters of the recent Fair Housing decision acknowledge that chronic multi-generation poverty is a problem with many causes, and changing the location in which one sleeps or the skin color of one’s neighbors will not be enough to solve it. So it might make a lot more sense to keep providing as much quality housing to as many households as possible while attacking poverty’s other causes, such as lack of job opportunities, inferior education, impediments to stable family structure, and government policies and programs that actually operate to discourage low-income work.
These changes, too, would have a disparate impact, but it would be a good one, on exactly the people we want to help climb out of poverty forever. It is hard to see how providing less housing, but providing it in different places, can measure up as a strategy for progress. Yet that is the approach housing advocates implicitly said they wanted. Now it may be the one they get.
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