Sunday, July 06, 2008

Chicago's Public-Private Housing Experiments Could Stretch Out to a Quarter of a Century

A huge issue I have with pulling in private developers to build public housing initiatives is that while the developers immediately benefit from an influx of tax money and free public land, projects designed to mix affordable housing for poor and working classes with middle class homesteads plod and languish.  A generation of families will pass in the time it will probably take Chicago to finish their public-private experiment in 2025.  Will demographics completely change the demand for housing that prompted the project in 2000?

Not everyone involved lacked foresight unblemished by the avarice for quick profits; residents themselves has concerns even before the project began:
Former residents may be the least surprised by the situation. From the start, many predicted they would be displaced and forgotten while developers grabbed coveted swaths of city real estate for re-development and private profit.

In pushing the plan, the Daley administration, the U.S. Department of Housing and Urban Development, and Habitat Co., the court-appointed overseer of public housing construction, placed what amounted to a high-stakes wager:

Upscale homes in the new developments would not only raise the aspirations of public housing families but also spur the construction of badly needed housing for the poor and affordable housing for working people struggling to buy a home.

Instead, the market-rate homes have proven in some cases to be an albatross.

From the beginning, construction at the new communities moved slowly, held up by bureaucracy, politics and complex financing.

Now, the downturn in the housing market threatens to bog down the plan even further because developers are struggling to sell high-priced homes amid a glut of new construction across the city.
Nothing is going to make this dog hunt, because the developers are making money and have no other investment in making it work. The politicians are supported by private money and have little incentive to help families that they claim to be helping. Privatization of public housing is a win-lose proposition and the losers are those without the money or power to leverage affordable housing.

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