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Its Time to Drive Away the Developers
by Steve Martinot
Monday Oct 30th, 2017 12:01 PM
Homelessness and tenant displacement, both now epidemic, are treated as separate issues, whereas affordable housing (as HUD defines it) will resolve both. There is no possibility of this unless government intervenes. Otherwise we are on treadmills with both issues. Some radical solutions are here proposed.
Its time to drive away the developers
By Steve Martinot

Funny how homelessness and the displacement of low income families by inordinate rent increases get turned against each other as issues. They are shunted into separate political domains, though building affordable housing would resolve both. The homeless are given shelters sufficient for 10% of their numbers, and the tenants facing displacement are given subsidy money to tide them over for a couple of months until the next threat of eviction. This, at least, is the extent to which City Council has seen fit to make positive policy with respect to these allegedly dual problems. The shelters guarantee that the problem of homelessness will not be reduced, and the city will continue to respond to it with increased policing. And addressing displacement only through monetary channels guarantees that for housing, the city will continue to turn to for-profit developers who will build market rate housing that induces displacement, and that the displaced cannot afford. Homelessness and housing get turned into policing and profiting, and people get thrown into the streets because there is no affordable housing. The outcome is the inability of the city to protect the majority of its people, the two-thirds of the population who are renters.

Alex Vitale has recently published a book called “The End of Policing,” in which he discusses not the goals of policing, but rather how to end the police as a problem for contemporary society. He goes over such topics as the school-to-prison pipeline, the police tendency to traumatize or kill people with emotional problems because they don’t obey commands while going through emotional crises, the misguidedness (as a foregone failure) of the war on drugs, the immorality of criminalizing sex-work, among other things. As he goes along, he gives several reasons why reforming the police is really an exercise in futility, given the nature and structure of policing itself. A good example is the iniquity of criminalizing the homeless through policing.

When a city administration polices the homelessness, it is using an administrative process that is irrelevant to the problem. It sets people flowing through circular channels from court to jail to the street to court to jail, and sadly, too often to prison sentences for incorrigibility because a person turns to real crime in an effort to escape this merry-go-round. The money spent to run this machienry turns out to be far more than it would cost to give these “victims of procedure” a home and a job. Researchers at the Univ. of Southern California showed that the “total cost per person of public services for two years living on the streets was $187,288, compared to $107,032 for two years in permanent housing” also with support services (a 43% difference). [Michael Cousineau, et al, Homeless Cost Study, United Way of Greater Los Angeles, 2009] In other words, "cost" is not the reason cities do not house the homeless.

In reality, addressing the problem of homelessness through policing and criminalization is a trick to fool people into thinking that they need bigger police departments and larger jails, despite the costs. Civil society then picks up the tab for financing an agency whose primary objective is general regimentation of the populace. Through this trick and others, police departments have become so large they constitute a political force without equal at the urban level.

On the other hand, Vitale argues, stopgap measures such as shelters and temporary housing have no effect for decreasing the homeless population. Homelessness, he says, “is about a mismatch between incomes and housing costs.” He references research by the National Low Income Housing Coalition that shows that “75% of extremely low income renter households spend more than 50% of their income on housing.” [“Rental Inflation Drives Homelessness and Housing Instability for the Poor,” May 1, 2015] For the more than “10 million extremely low income rental households in the US, … only 3.2 million rental homes … are available and affordable to them.” (Vitale, p.103) And I might add, on the basis of a survey I made of rent controlled units in West Berkeley during the fall of 2016, the majority of tenants in controlled apartments are actually paying 70% to 75% of their income for housing, with a substantial number paying more than that.

“Extensive research now exists that the ultimate solution to homelessness involves increasing pay for low-wage work and creating more affordable housing, with support services for those who need it. Emergency shelters, transitional housing, life-skills training, and forced savings programs do nothing to reduce the overall amount of homelessness. The housing market on its own cannot house the growing number of people who are left out of the formal economy or have a tenuous relationship to it. In such a situation, the state has no choice but to intervene directly.” (Vitale, p. 102)

That means that government “must either dramatically raise the value of transfers to stimulate new low-cost housing construction or provide the housing itself.” We are not speaking about government choosing radical solutions. What Vitale is arguing is that a radical solution is the only one left. Any other, such as income support, welfare payments, or earned income tax credits will fail to keep pace with housing costs, and get lost in a supply-and-demand cycle of their own, owing to the influx of new low income renters.

Two years ago, the city of Berkeley admitted that the only real solution for the problem (aka travesty) of low income tenant displacement was building affordable housing. ("Affordability," on HUDs standard, means that the maximum rent chargeable is 30% of the tenant’s income). Building “market rate” housing has put the city on a treadmill, huffing and puffing to get housing built, and getting nowhere in terms of resolving the affordable housing crisis. In fact, Berkeley has glutted itself with market rate housing, having fulfilled its requirement under Plan Bay Area. Today, one sees banners on big apartment buildings over a year old still announcing “Now Leasing” and “Apartments available.” Indeed, in the face of this glut, developers are now approaching the Planning Dept. with a demand that they be able to condo-ize. With respect to homelessness, that would only set the city on another treadmill.

The point of a treadmill is that it allows some people to crow that they are dealing with the problem while those who suffer from the problem see that the situation only getting worse.

Okay, lets get real – which means getting radical. City zoning only asks that 20% of each new housing project be affordable, which developers can avoid by paying a mitigation fee. That rate is a drop in the bucket given the need for low income housing. It also provides a pittance for the Housing Trust Fund (to use to build affordable housing) since the mitigation fee is only $34,000 per unit. The urgency of the situation calls for housing projects that will provide from 80% to 100% affordable units.

The city could change its zoning to require that by changing one number in its municipal code (Sect. 22-20-065D). There is a formula there, with a "20%" in it. Change it to "80%" and raise the mitigation fee to $120,000 per unit (which would put real money in the Housing Trust Fund) and the city could resolve its affordable housing problem. The benefits from doing so would be many.

First, these increases would not violate the Palmer decision (which holds that if a city mandates affordable housing units, then that city must make up the difference in developer earnings). The way the law is written in Berkeley, if 20% doesn’t violate Palmer, than 80% won’t either. The developer can still pay a mitigation fee to not include affordable units – that is, inclusion of affordable units remains voluntary. Second, it would defend the city against developers who opportune on the Housing Accountability Act that neutralizes the city’s ability to give democratic power or at least some choice concerning development to neighborhoods. And third, regulations like this would probably drive away some of the profit-hungry developers and their financial backers (aka banks). That might not be a bad bargain since all they can offer is a product (market rate housing) that we don’t need, while refusing to provide a product (affordable housing) that we do need.

There are those who would cry out that this would insure that nothing gets built. They only reveal that they worship the god "profit" and use the “law of supply-and-demand” as gospel. It is a religious argument. After chasing the unneeded for-profit developers away, the task would be to take over the land they will no longer be using (there are ways of doing that), and give it to any of the non-profits in the area who build affordable housing. We have several organizations in this town – SAHA, RCD (Resources for Community Development), and others waiting in the wings, who would love to take this on. Raising the bar on affordable housing might (could, would, should?) violate the developers’ fixation on profit, but it does not mean that nothing will be built. It simply implies that it won’t be built by profit-fixated developers.

The real job would be figuring out where to find alternate forms of financing. But alternate financing should be possible. There are many versions of mortgages to choose from, or bond issues, or federal subsidies (maybe a problem), or taxes on the rich and the huge corporations (maybe a virtue), or actually humanitarian investment, etc. But we already face this task. These would be the same means, using the same ideas and alternative sources, that would be needed to resolve the homeless crisis. There would have to be subsidized apartments for homeless people, until they get jobs and a stable income. And services will have to be provided in the meanwhile, since homelessness is a traumatic experience – one created by our socio-economic structure. To police the traumatized homeless is like breaking a man’s leg and then arresting him for vagrancy because he can’t walk.

But as long as I’m talking "radical," lets go for it. What we need is a suit against the Pentagon for spending money on unneeded, redundant, and useless warmaking technologies, where that money is needed by the people of the US. We have a recent precedent. Two California counties and a city have sued 37 oil, gas, and coal companies for selling their products in the knowledge that they were causing serious climatic disruption. Other cities are suing a smaller number of oil companies for the same reason. It is like the suits against the tobacco companies. The dangers of climate change are not just against human health, however, as with the tobacco plague. We face rising sea levels, the fact that entire species are moving northward, and there is an accompanying and on-going mass extinction in progress. All of this poses severe threats to the planet, to society, and to human life in general.

This raises the interesting question of the kind of courage it would take to sue the Pentagon for hoarding the funds that would provide housing and free education and free healthcare for all the people of the nation. The only people who might object to such a suit and such courage (other than the usual corporate executives and investors) would be the white supremacists and white nationalists, since they do not want to be involved in national programs in which black and brown people have access equal to whites.

But we should heap unending scorn on cities and states that whine about not having funds to provide a decent life for people. There is plenty of money, squandered and wasted by the five-sided institution. Its sole function is to kill people, and it does that to us as well by hoarding the funds we need to live better. Or at all. Every month, some homeless people die on the street.