Housing News Roundup: August 24, 2016
The Housing Affordability Crisis in Washington, DC
Washington, DC, is facing a housing affordability crisis that threatens to push both low- and middle-income residents out of the city. Between 2002 and 2013, inflation-adjusted rents have risen, but incomes have not. The DC government is using federal and local funds to support new housing construction, rehabilitation, and community development work in low-income communities, all of which could add balance to the housing market. Despite an inclusionary zoning program and record spending from local coffers on affordable housing production and preservation programs, a sizable gap remains. The DC Fiscal Policy Institute estimates that it would cost approximately $5 billion to ensure that city residents’ housing needs are met, yet the total budget controlled by city leaders is just around $7 billion. “Those numbers are not going to add up,” says Claire Zippel of the DC Fiscal Policy Institute. The problem is exacerbated as the heated market entices property owners to opt out of affordability programs as the required subsidy periods expire.
Program for Elderly Homeowners is Privatized
The effects of last year’s federal decision to allow for-profit companies to administer services under the Program of All-Inclusive Care for the Elderly (PACE) are now being seen. PACE providers receive a flat payment from Medicare and Medicaid of $76,728 per patient on average, in exchange for arranging and providing all medical care and social support services for senior citizens enrolled in the program. In comparison, staying in a nursing home costs, an additional $5,500 per year on average. One PACE provider, InnovAge, dropped its nonprofit status to pursue private equity investment. According to Julie Reiskin, executive director of the Colorado Cross-Disability Coalition, this change has increased interest in serving people with disabilities because they may be PACE-eligible. There are some concerns that the private sector will push too hard to keep costs down, providing insufficient care while earning profits. However, a demonstration program in Pennsylvania that compared quality of care and costs between nonprofit and for-profit PACE providers found no differences. “At the end of the day, we’re held to the same quality and care standards,” says Maureen Hewitt, chief executive at InnovAge.
Source: The New York Times
High Housing Costs Push Bay Area Students Out
Rising housing costs in the San Francisco Bay Area have forced families to make difficult decisions to move long distances in search of affordability or accept overcrowding to stay in their community. For families who move out, children either change school districts or commute long distances to avoid disrupting their school continuity. One commuting high school senior, Mya Shiloh, revealed that she must wake up at four in the morning to get to school by eight, and she needs to take a three thirty train in the afternoon to make the trip home. This routine “cuts into activities she loves, including school clubs and drama, as well as socializing and sleep.” School districts also experience unexpected enrollment changes because of the high housing prices. The San Mateo-Foster City School District lost 500 low-income students who transferred elsewhere, but the district’s student enrollment grew because of the wealthier families relocating to the area. In other schools, displacement has led to net enrollment losses.
Source: The Mercury News
Neighborhood Segregation Remains by Race, Not Income
Despite assumptions that communities are now segregated by class, income patterns do not explain American segregation patterns. The continuing aftermath of legally enforced racial segregation does. Stories of several affluent black families who live in high-poverty neighborhoods in Milwaukee highlight a phenomenon present in other large metropolitan areas, such as New York, Chicago, and Los Angeles: “black families making $100,000 or more are more likely to live in poorer neighborhoods than white households making less than $25,000.” To get family support in caring for a sick child, the Sabir family (both parents have professional degrees and six-figure salaries) moved back to a neighborhood where “one in three families lives in poverty.” The Sabirs chose to stay because of the strength of the community. Their neighbors would check on each other and offer help—despite often being subject to racial profiling in nonblack neighborhoods. Another family, the Brookenses, moved to the suburbs and faced a combination of scrutiny and concern about cultural losses before eventually moving back to a majority-black section of the city.
Source: The New York Times
School District Lines that Segregate Poverty
A new report by EdBuild ranks the school district boundaries that most sharply divide student populations by poverty rate. The Detroit City School District and Grosse Pointe Public School produced the largest difference in poverty rates among neighboring districts. Six of 13 school district boundaries in Birmingham, Alabama, were ranked among the nation’s top 50. Alabama was the only Southern state to be included on the list, likely because most school district boundaries in the South also serve as county lines, creating “less opportunity for intentional segregation.” Many schools on the list were in Rust Belt cities because families lost the ability to move as their manufacturing jobs disappeared, forming isolated areas of extreme student poverty. The 1974 Supreme Court decision in Milliken v. Bradley ruled that desegregation could not be forced across school district lines.