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Town Hall, Advocacy Day, and Housing Budget Needs

Between the 3rd Annual Homeownership Town Hall & Housing Fair on Saturday and CNHED’s Advocacy Day on Monday, the Housing Advocacy Team has been busy! Here’s what you may have missed:

Town Hall

Saturday’s Town Hall and Housing Fair was a great success, with more than 200 residents coming out to Thurgood Marshall Academy in Anacostia to gain information on affordable homeownership opportunities. Robert AX Adams’ smooth electric guitar and vocals entertained the community members as they wandered through 25 tables with information from nonprofits, government agencies, financial institutions, and more.

Workshops on DC property tax relief, estate planning, an introduction to MANNA’s Homebuyers Club, and more offered information for current and prospective homebuyers alike.

The Town Hall portion of the day was led by HAT’s Tanya Morris, also a MANNA board member, who told her story of buying an Affordable Dwelling Unit in Columbia Heights. (You can hear more from Tanya below.)

Rev. Jim Dickerson spoke of MANNA’s founding over 35 years ago and the more than 1500 homes MANNA has built before turning the mic over to Don Folden, the leader of Capitol Buddy’s DC Black History Tours. Don spoke about the history of Anacostia and all of DC, expounding on its racial property covenants and government backed mortgages that kept homeownership an almost exclusively white venture.

That history is a big part of why programs like the Home Purchase Assistance Program are a matter of justice. More than 90% of HPAP borrowers are people of color, and without the program many of those families still would be locked out of homeownership.

Residents signed postcards to DC Council Chairman Phil Mendelson asking him to keep the Mayor’s proposed $8 million increase to HPAP’s budget (a total of $26 million). They also asked that he hold a hearing for Councilmember Anita Bonds’ (At-Large) bill guaranteeing funding for the Housing Production Trust Fund at a minimum of $120 million each year.

Councilmember Robert White (At-Large) spoke to the crowd about the importance of HPAP and homeownership. Himself a generations-deep Washingtonian, he highlighted the history that has kept black Washingtonians from owning homes and the responsibility of the government to correct those wrongs.
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Councilmember Robert White and DHCD Director Polly Donaldson

Polly Donaldson, Director of the Department of Housing and Community Development, also stopped by to highlight the investments that Mayor Bowser and the Housing Department have made in low- and moderate-income homeownership. HPAP helped about 300 Washingtonian families become homeowners last year, and the Mayor’s proposed increases could see even more families served next year.

Advocacy Day

The Coalition for Nonprofit Housing and Economic Development held its annual Advocacy Day on Monday, April 23, and HAT was out in force. Coucilmembers Brianne Nadeau (Ward 1), Vince Gray (Ward 7), David Grosso (At-Large), and Charles Allen (Ward 6) all stopped by to speak to the crowd of yellow shirts packed into the Council hearing room.

CNHED speakers then educated the crowd on important programs that are underfunded in the Mayors budget before residents fanned out to meetings in all 13 Council offices.
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Councilmembers Allen and Nadeau

Among the programs for which the Council to find more funds is the Local Rent Supplement Program, or LRSP. These local rent vouchers help families with very low incomes who otherwise would likely be severely rent burdened. The vouchers are either given to the tenant for them to find housing on the open market (called “tenant-based vouchers”) or given to a landlord and tied to a specific low-cost unit (“project-based vouchers”). They Mayor’s budget zeros out investments in project-based vouchers, a concerning development that could have the unintended consequence of forcing low-income families to become homeless in order to be eligible for rental assistance.

Another top concern is a proposed cut to Housing Counseling Services which could severely curtail the homebuying counseling that MANNA and other counselors are able to provide. It’s a cut that makes little sense alongside an increase to HPAP—families served by HPAP need access to strong counseling services in order to have the best chance to succeed.

Finally, CNHED and HAT continue to push for more funding in the Housing Production Trust Fund. While Mayor Bowser’s commitment to $100 million in the fund each year has been historic, it is no longer keeping pace with either need or capacity. DC can and must build more affordable homes in order to keep our city a place that all residents can afford, and guaranteeing a minimum of $120 million in the trust fund each year is a good place to start.

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Housing Production Trust Fund Makes for Better Homes than Headlines

When the DC Auditor’s Office released its report on the District’s Housing Production Trust Fund earlier this week, the headlines started rolling in right away. City Paper called it “damning.” Think Progress spoke of “astonishing failures.” But a deeper dig into the report’s talking points reveals that the truth in this case is a good bit less sensational than promised.

Where it misleads

The Housing Production Trust Fund is DC’s number one source of affordable housing dollars, and it has a hand in the construction of the vast majority of the District’s affordable homes—more than 10,000 such homes in the past 15 years, according to the audit. The trust fund is legally required to be used as gap financing, meaning that it can fund no more than 49% of any unit’s cost. This allows the fund to do significantly more work and touch significantly more projects than if it were the sole funding source for every unit it produced.

Given the variable level of funding each project receives, plus the fact that the size of DC’s investment in affordable housing is unrivaled in the US, it’s almost impossible to compare what the District is doing with other cities. But that’s exactly what this report tried to do.

The audit found that the trust fund’s average subsidy per unit was $61,700—a number that doesn’t seem bad compared to the District’s median home value of more than $550,000. But the report instead compared that number to Philadelphia and Seattle’s trust funds, which the auditors determined spend only $21,190 and $36,000 per unit respectively.

Even without comparing the size of the funds being managed, these numbers don’t take into account different amounts of federal funding, different income levels being served, or the vastly different markets that they’re working in (Philadelphia’s median home value is a full $400,000 lower than DC’s). Nevertheless, that $61,700 per unit and its comparison to other cities has been presented as the end-all-be-all in determining the fund’s efficiency.
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Another point that the audit and its media coverage have overblown is the state of the fund’s revolving loans. All the money that the trust fund sends out is structured as a loan, set to be repaid based on a project’s cash-flow or the expiration of its affordability covenants.

The audit notes that in the past four years, only 4% of the fund’s resources have come from loan repayment. But as the Department of Housing and Community Development’s (DHCD) Director Polly Donaldson has noted, delayed repayment is a key feature of the fund, not a flaw. Deferred loans allow smaller developers and non-profits the time they need to repay District funds. To put it another way, it’s no wonder this audit’s 15-year scope didn’t capture 40-year loans.

The revolving loans have also caused a flap with the somewhat inexplicable revelation that almost all of the fund’s long-term loans have been written off as unrecoverable. While repayment of 40-year loans on affordable housing projects may not be 100%, it’s certainly not going to be zero.

Finally, the audit causes confusion by not specifying the administrations responsible for some of its worst findings. For instance, while it’s a serious problem that DHCD had to give back $16 million in federal funds, it’s also important to note that that bungling came under a previous administration. It’s certainly not the sort of thing that should keep Councilmembers from investing more in the trust fund now.
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Where it shoots straight

The report is certainly helpful in some areas. It’s no secret that administrative costs for the trust fund have been too high, and the audit also points out a few instances in which small amounts of money were spent on non-housing projects, like bicycle education. Those issues are real, and they need to be addressed.

The report also points out that the trust fund hasn’t been meeting its legal requirement to spend 40% of its funds on very-low income residents, those making less than 30% of the Area Median Income. It’s an important problem to address, one that has come up frequently in Council hearings over the past few months.

The trust fund is already doing better than it seems, however, when other programs are taken into account. While trust fund income limits may not be low enough to meet requirements, those units are often cross-paired with rent supplement programs that serve residents under 30% AMI. Because those units require so much funding to produce and operate, it often requires more than one source of subsidy.

The real take-away

At the end of the day, the lede is buried, both in this post and The Washington Post. The Housing Production Trust Fund has produced or preserved more than 10,000 affordable homes over the past 15 years. That’s over 10,000 families who would otherwise almost certainly be rent burdened—if they managed to stay in DC at all.

There’s certainly room to improve the trust fund. But that improvement has to come in the context of the incredible work the fund has done and continues to do. Otherwise, this audit will cause more harm than good for the families it hopes to serve.

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5 DC Housing Bills to Watch in 2018

2018 is an election year for the DC Council, which means some bills will languish while others suddenly sprint ahead. Here are five bills that affordable housing advocates should keep an eye on. To subscribe to updates on any of these bills, click the link and then hit the orange “Subscribe” button at bottom right!

Home Purchase Assistance Program

Home Purchase Assistance Program Amendment Act of 2018 (B22-0682)

Introduced February 6th, 2018
Co-introduced/co-sponsored by: the entire Council

This bill would increase the size of HPAP in two ways. (If you need a quick explainer on what HPAP is, click here.)

First, the bill would increase the maximum income a household can have and still be eligible for the program from 110% of the Area Median Income (AMI) to 120% AMI. For a family of four, that’s an increase from about $120,000 to $130,000. Second, it would increase the loan amount that each income category is eligible for by about $20,000. That would make the maximum loan $100,000 and the minimum loan $32,000.

There’s a case to be made for each of these increases, but they come with a big price tag. Given that the program is already set to run out of money this year without the changes, the Council will need to drastically increase HPAP’s $17 million budget if they want these two expansions to have the desired impact. This bill is currently waiting for a committee hearing.

Condo/Co-op Ownership

Common Interest Communities Remedial Funding Act of 2017 (B22-0273)

Introduced May 2nd, 2017
Co-introduced/co-sponsored by: Councilmembers Anita Bonds (At-Large), Brianne Nadeau (Ward 1), Trayon White (Ward 8), Robert White (At-Large), Elissa Silverman (At-Large), Brandon Todd (Ward 4), and Vincent Gray (Ward 7)

Across the city, low-income condo and co-op associations are struggling to keep up with needed maintenance for aging buildings. This bill would help those associations with a one-time grant of up to $30,000, along with training for board members.

At a hearing for the bill in November, residents testified that a program like this could be a great help to their associations. However, many also suggested that $100,000 would be a more appropriate grant size for rehab work on a multi-unit building. The bill is now waiting for committee mark-up.

Housing Production Trust Fund

Housing Production Trust Fund Guarantee Funding Amendment Act of 2017 (B22-0226)

Introduced April 4th, 2017
Co-introduced/co-sponsored by: Councilmembers Bonds, Kenyan McDuffie (Ward 5), T. White, R. White, Nadeau, and Gray

The Housing Production Trust Fund is DC’s biggest source for building and preserving affordable housing. It has made and saved homes for thousands of Washingtonians, and Mayor Bowser and the Council have done historic work by funding the trust fund at $100 million each year since the Mayor took office.

But each year, the trust fund is subject to political fights about its funding. If a new Council or Mayor loses the political will, the trust fund could quickly be on the chopping block. What’s more, $100 million isn’t what it used to be.

This bill would guarantee the Housing Production Trust Fund at $120 million each year, keeping it from sinking below that level of funding no matter the political will of the moment. It is currently waiting for a committee hearing.

Rent Control

Rental Housing Affordability Stabilization Amendment Act of 2017 (B22-0025)

Introduced January 10th, 2017
Co-introduced/co-sponsored by: Councilmembers Bonds, Mary Cheh (Ward 3), Silverman, Gray, David Grosso (At-Large), and T. White

Today, the thousands of units protected by DC’s rent control law see a modest increase in their rent each year: the rate of inflation, plus an extra 2 percent. Last year that increase would have been about 3 percent total—not a big deal. But tenants note that the additional 2 percent adds up quickly. Over the course of a decade, rent control units’ prices can easily increase by more than a third.

What’s more, rents can increase by up to 30 percent immediately when a unit becomes vacant. Not only does that undermine rent control, but it also incentivizes landlords to evict tenants without cause. This bill would cap the vacancy increase at 5 percent, and limit the annual rent increase to just inflation. It had a hearing last June and is now waiting for committee mark-up.

Preservation of Affordable Rent Control Housing Amendment Act of 2017 (B22-0100)

Introduced February 7th, 2017
Co-introduced/co-sponsored by: Councilmembers Bonds, R. White, Silverman, Cheh, and T. White

This bill deals with another problem facing rent control: voluntary agreements. Voluntary agreements are supposed to be a way for landlords and tenants to come together on rent increases outside of rent control. They’re helpful when tenants need something done (e.g., expensive rehab work) that otherwise the landlord couldn’t afford.

But recently, landlords have been enticing tenants to sign voluntary agreements that only affect future tenants’ rents. If you could get needed benefits for yourself by signing away someone else’s cheap rent, would you do it? This bill says you shouldn’t have to make that choice.

It prohibits voluntary agreements that have different effects for current and future tenants. The bill had a hearing last June, and it’s currently waiting for committee mark-up.

Have another bill you think should be included here? Let us know in the comments!

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Trump might cut low-income lending. Here’s how DC needs to respond.

In November of 2017, DC Councilmember David Grosso (At-Large) introduced a bill that would likely increase affordable housing investments and low-income lending by banks that do business with the District government. That bill—and the work it looks to accomplish—have always been important. But recent moves by the Trump administration have made its passage more important than ever.

What’s in the bill?

The bill is actually an update to an earlier responsible banking law, the Community Development Amendment Act, or CDAA. The CDAA set standards for banks that do business with the District government, as well as making their past commitment to low-income lending a part of their score when applying for District contracts. If a bank is benefitting from DC tax dollars, the thinking goes, then that bank needs to be benefitting all DC taxpayers.

But that law, passed in 2014, has never had the impact that its supporters hoped. A loophole in the way the law was written allows DC’s Chief Financial Officer to renew District banking contracts without putting banks through the evaluations specified in the law. That means that as long as DC doesn’t change banks, the CDAA’s responsible banking requirements are meaningless.

The new bill from Councilmember Grosso, entitled Strengthening the CDAA, would close this loophole by requiring that any bank up for a contract renewal be put through the full evaluation process. It also adds to the CDAA by raising the importance of a bank’s past lending activity when that bank is applying for a District contract. The bill was introduced with the support of Councilmembers Bonds (At-Large), Robert White (At-Large), Trayon White (Ward 8), Gray (Ward 7), and Silverman (At-Large).

With this kind of evaluation in place, banks that want to compete for District contracts will have more incentive to serve all of DC’s neighborhoods. Banking services in certain parts of the city, especially Wards 7 and 8, are scarce. Residents have few options when looking for a loan, and many are forced to turn to predatory payday lenders. Getting access to non-predatory home loans and other financial services is a crucial part of increasing racial equity in DC.

One of the ways that both the current law and the new bill evaluate banks is their score from the Community Reinvestment Act. The Community Reinvestment Act was passed by Congress in 1977 as an antidote to decades of racist lending policies. It scores banks on their lending in low income communities and allows community advocates to point out racist lending patterns that exist to this day.

Banks care about their score on this test because it determines their ability to do big money-making deals like mergers with other banks. (The Community Reinvestment Act is worth its own blog post, and you should read the one linked above!) The CDAA and Councilmember Grosso’s new bill both bring extra leverage to the work that the Community Reinvestment Act does.

Why this matters now more than ever

As with most programs that support low-income Americans and people of color, the Community Reinvestment Act is under threat by the Trump White House. Reports emerged earlier this year that the Trump administration is planning to significantly weaken the Community Reinvestment Act, allowing banks to get away with less lending to deserving low-income individuals.

That could create even bigger gaps in access to mortgages and other lending in low-income communities. And those communities are already hurting. Reports from last year indicated that banks were already starting to further limit their lending in low-income communities, even before rumors of a Community Reinvestment Act rollback started.

Local governments will need to fill the hole created by lost Community Reinvestment Act lending, and Councilmember Grosso’s bill to strengthen the CDAA is a great step in that direction. If the DC government really wants to support access to lending for all Washingtonians, Strengthening the CDAA is a must.

The next step for this bill is a hearing in Councilmember McDuffie’s Committee on Business and Economic Development. You can reach Councilmember McDuffie at 202-724-8028, kmcduffie@dccouncil.us, or on twitter at @CM_McDuffie .

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How could public campaign financing change DC housing?

In a move that would have been unthinkable just a decade ago, the DC Council voted unanimously last week to approve public financing for local elections. For a city that has suffered from the perception of pay-to-play politics almost since its inception, this move could cause major changes to how housing development is seen in the District.

The bill, which needs a second council vote and the Mayor’s approval or a council override, would use public funds as a multiplier for small-dollar donations that council and mayoral candidates receive. Any donations candidates receive before they are on the ballot would be matched by a multiple of two. After they’re on the ballot, that increases to a multiple of five. Candidates also receive a lump sum from the city ($160,000 for mayor, $40,000 for council) after they’ve hit a minimum number of small dollar donations.

The program is voluntary, but by agreeing to be a part of it, candidates limit the maximum contribution they can accept. For mayor, that drops from $2,000 to $200 per individual. For a Ward-based councilmember, that drops all the way down to $50.

Despite the bill’s unanimous support from the Council, the Mayor has expressed opposition to public financing for elections. She says that funding (estimated to be around $5 million per year) could be better spent on other projects.

But it could be a small price to pay to remove the longstanding perception that development in DC depends on donations to the right candidates. A 2013 review by WAMU found that from 2003 to 2013, more than a third of the $1.7 billion in District subsidy for development went to the ten developers who donated the most to political campaigns.

That same report found that less than 5 percent of subsidy went to Wards 7 and 8, where investment is most needed. Although that picture has changed with Mayor Bowser’s yearly commitment of $100 million to the Housing Production Trust Fund, which provides funding for affordable housing across the city, disparities remain.

This matches with data from a 2016 report by Demos that shows that while white residents make up less than 40 percent of the District’s population, they represent more than two-thirds of local donors. Similarly, although only one in four District residents earn more than $100,000, those earners make up 60 percent of all campaign contributions.

Public financing and its emphasis on small dollar donations could bring more attention the needs of all District residents in campaigning and crafting policy. Just as importantly, it could also help bring transparency to the city’s development process and remove any lingering doubts about the fairness of how subsidy is awarded.

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Home Improvements for Caregivers: Tips to Help You Better Care for Your Loved One with Alzheimer’s

Photo by Pixabay

Guest post by Lydia Chan of Alzheimerscaregiver.net

Alzheimer’s disease affects about 5.4 million Americans, about 5.2 million of which are 65 and older. It can be your grandparent, your cousin, your sibling, or even your parent who faces the diagnosis. Eventually, those with Alzheimer’s require round-the-clock care, and for many families, that means taking the loved one into their own home. Here are some home improvement tips for those caring for an Alzheimer’s patient in their home.

First, recognize how Alzheimer’s changes a person. It affects the body, so balance and depth-perception issues can be a concern. But the main concern for caregivers of Alzheimer’s patients is the loss of judgment and memory which can leave patients confused and suspicious or fearful. For instance, they may not remember where they are or how to use household appliances.

One of the first things that you can do to improve your home for Alzheimer’s patients is to remove tripping or falling hazards and add fixtures that assist them, such as grab bars in bathrooms and hand railings on both sides of stairs. Because of balance difficulties, patients tend to shuffle their feet rather than picking them up, so even deep-pile carpet or area rugs can be hard to walk on. If you think about a person in a wheelchair trying to navigate your home, you will notice things that might be difficult for Alzheimer’s patients as well. Stairs are a major concern because these patients also have trouble with depth perception. Making sure every room or hallway has bright lights and switches at every entrance can help. Remove door sills that are not flush with the flooring and avoid polished floors which may be slippery. Other simple improvements include replacing door and shower fixture knobs with pull handles that are easily gripped, and adding a shower seat.

Longer-term solutions include actually making your space wheelchair accessible, which includes widening doorways and adding a ramp at the door. Converting bathtubs into walk-in showers is also helpful. If you have stairs, make sure the steps are wide enough for an entire foot, and the surfaces are not slippery. Adding contrasting wood, carpet, or paint colors can aid in seeing individual steps more clearly. You might also consider adding a stair lift if the patient will need to traverse the stairs regularly. Check all flooring for slippery surfaces and consider replacing tile or polished wood with low-pile carpet or new flooring with low-slip ratings.

Adding recessed lighting under kitchen cabinets can help everyone see better, and adding large-print directions or brightly colored splashes of nail polish by the main buttons on the microwave or stove can help Alzheimer’s patients easily find the settings they want to use. Eventually, you will probably want to keep patients on the first floor of your home so they won’t have to go up and down stairs. A private bathroom should also be included. Adding a life alert system that monitors them and keeping safety alert numbers in a conspicuous place for them or other caregivers to use, if necessary, can be a great assistance in case of emergency.

There are many things to think about when you’re the caregiver of a person with Alzheimer’s disease. When caring for patients, it’s essential that they can navigate safely. You cannot plan for every emergency, but you can prepare your home for the majority of issues that Alzheimer’s brings. Having your loved one with you in your home will make you both feel better.

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Advocates Lose Tax War, Win Battle: Affordable Housing Bonds Saved

The disastrous conflagration that was 2017 ended with a major gut punch to social advocates across the country. The Republican tax bill, with its massive handouts to corporations and the wealthy, squeaked through Congress and into law. But private activity bonds, a key instrument for the funding of affordable housing, were saved at the last minute.

The fundamental realities of the tax bill are still grim. It will add over $1.5 trillion in a decade to the national debt and is likely to hamstring numerous social programs in the coming years—perhaps by design.

While the impact that this bill will have for families depending on affordable housing isn’t entirely clear yet, it’s almost certain to be negative. In a climate where the Trump Administration already tried to cut $6 billion from HUD as a money saving move, officials are likely to identify less money coming in as another point for their argument.

Furthermore, the Low-Income Housing Tax Credit (LIHTC), which builds most of the affordable housing in the US, has a funding model that varies significantly based on the corporate tax rate. When that rate falls, less funding exists for the credit. Cutting the corporate rate from 35 percent to 21 percent, as Republicans just did, is projected to result in 200,000 fewer affordable homes being built in the coming decade.

But the rest of LIHTC funding comes from private activity bonds. This form of funding depends on its tax-exempt status to keep projects affordable. The House version of the tax bill would have eliminated these bonds, leading to an almost unimaginable 800,000 fewer affordable homes over the next decade.

Locally, the prospect was dire enough—about 9,000 affordable homes have been produced in DC through private activity bonds since 2010—that District officials quickly crafted a plan to at least preserve most of the affordable homes already in DC’s pipeline. The Mayor, citing “DC values,” announced early last month that DC’s Housing Finance Agency would issue $500 million worth of its own tax-exempt bonds before the tool disappeared completely.

Thankfully, that move has proven unnecessary. Advocates won big in ensuring that private activity bonds were untouched in the bill’s final version. Now those same advocates go back to work, pushing for local budgets to cover the federal government’s affordable housing hole.

Hopefully DC values will once again lead the way.

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Affordable Housing: Mayor Announces $500 Million to Offset GOP Bond Cuts

“Like most Americans, we were sleeping last Friday at 2am when Senate Republicans passed what they call the ‘Tax Cuts and Jobs bill,’” said Mayor Bowser, at a press conference in DC this morning.

And like most Americans, the Mayor was not happy. The tax bill would decimate the country’s ability to fund its necessary social services going forward, adding around $1.5 trillion to the federal debt. But most specifically to the work of the Housing Advocacy Team, the bill cuts a key tool for funding affordable housing: private activity bonds created through the Low-Income Housing Tax Credit.

These tax-exempt bonds leverage private investment with public subsidy to create affordable housing. Many affordable homes currently in the works in DC are counting on having access to this financing. But under the version of the bill the Senate passed these bonds would be severely weakened, and under the House’s bill they would disappear entirely.

MANNA, Inc. just finished two apartment rehabs in Brightwood—a total of 60 homes—that wouldn’t have been possible without this program. And there are another 230 homes in MANNA’s pipeline that depend on private activity bond financing.

Those numbers are reflected in the city as a whole, too. Since 2010, 9,000 affordable homes have been produced or preserved thanks to private activity bonds. And it’s exactly the kind of innovative market-led program that Republicans claim to love. $1.3 billion in public funding have produced an additional $650 million in investment from the private market.

bowser press conferenceMayor Bowser at Monday morning’s press conference

The importance of private activity bonds led the Mayor to decide DC couldn’t wait to see what happens before acting. “While we call on Congress to go back to the drawing board on taxes, we are not going to wait to act on housing,” declared Mayor Bowser.

That’s why she announced that DC’s Housing Finance Agency will be issuing $500 million of its own tax-free bonds to preserve most of what the District might lose under the federal bill.

That will allow DC to produce or preserve an additional 4,000 affordable homes—most of which are already in the works. The Mayor noted that as large as this investment is, it doesn’t even meet everything that’s in the current affordable housing pipeline. Getting funds quickly to projects that are furthest along will be crucial for keeping DC’s affordable housing development on track.

But the bond funding also serves as an important statement of what DC stands for—what Mayor Bowser often cites as “DC values.” As Councilmember Anita Bonds (At-large), the chair of the City Council’s housing committee put it, “It is important that in our own way we send a message that we will stand against these cuts.”

With the issuance of these bonds, the District government communicates that providing safe, affordable homes for all remains a top priority.

If only the same could be said of the other government in DC.

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Republicans, Tax Cuts, and the Manufacturing of a Crisis

We have a debt crisis staring us in the face. … The problem we have is spending, not taxes. We’ve got to get our spending under control because that’s the root cause of our problem.
-Paul Ryan, speaking in 2011 on Meet the Press

On its face, the Republican tax plan working its way through Congress is not a direct assault on affordable housing. Yes, it would decimate bond funding for affordable projects. Yes, it would eliminate several tax credits that help build affordable housing. And yes, the very rumor of its existence has caused multi-million dollar holes to appear in affordable housing plans for over a year now.

But still, this does not appear to be an assault on affordable housing in the same way that this summer (and fall’s) campaign to repeal Obamacare was an assault on healthcare.

Bruce Bartlett, a former policy adviser to President Reagan, says that appearance is wrong. In a recent op-ed in the Washington Post, Bartlett says that in the minds of many congressional Republicans, the $1.5 trillion deficit resulting from tax cuts isn’t a defect—it’s a primo feature.

That deficit, caused by their tax breaks to corporations and the wealthy, will allow Republicans to double down on arguments like the one Paul Ryan makes above. “There’s only so much money coming in,” Republican leaders will explain. “The responsible thing to do is cut spending.”

Sound overly cynical? Bartlett knows first-hand that it’s not. It’s the same thing that congressional Republicans did in the 1980s after Reagan’s tax breaks. It’s the same thing that they did again in the 2010s (see: Ryan, Paul), in a crisis caused by the Bush tax breaks. And it’s the same thing Kansas Republicans have been doing for the past half-decade as Governor Sam Brownback works to create a tax-free utopia.

In each of these cases, Republicans passed massive tax cuts, then railed righteously against the resulting unbalanced budgets—demanding that social spending be cut to right the ship.

It’s a part of the “starve the beast” movement (the beast being our government and its social programs), another step along the way to making government small enough to drown in a bathtub.

And we’ve already seen what the Trump Administration’s true priorities are for affordable housing—this year they proposed throwing 200,000 low-income families off of rent vouchers, with a significant portion of those families likely to end up homeless.

Congress balked at those plans, with even many Republicans seeing the cuts as unnecessary and cruel. But that calculus could easily change when the mother of all manufactured crises hits.

If this tax bill goes through and the US is running $1 trillion per year deficits by 2020, Republicans will likely be clamoring again to balance the budget—and discretionary spending on things like affordable housing will be among the first things to go.

“The problem we have,” Paul Ryan will piously remind us, “is spending.”

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Georgetown and Southwest DC: Two Histories, One Outcome

Image: DC’s Southwest Waterfront, a working class black community, before its destruction

“Those who cannot learn from history are doomed to repeat it.”  –George Santayana

Over more than a century, two separate government initiatives resulted in the forceful displacement of 45,000 black Washingtonian families. In 2017, the replacement of those families with a new whiter, wealthier population draws near completion.

Black Georgetown

At the turn of the 20th century, Georgetown was home to a thriving black community. Excluded from many other neighborhoods close to downtown by racial property covenants, black residents were able to put down roots in Georgetown thanks to the area’s alley dwellings.

The alley dwellings, which were simply in-fill houses that faced towards alleys rather than along a city street, became home to black professionals, business owners, and social groups. At its peak, the community had half a dozen churches throughout Georgetown.

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Mount Zion United Methodist Church in Georgetown, early 1900s

But by the 1910s, the area was becoming more desirable to white families—and the importance of segregation was increasing at a national level. In large part driven by a desire to remove Georgetown’s black residents, federal officials declared alley dwellings a public health issue and created a plan for their demolition with the Alley Dwelling Act of 1914.

Certainly the alley dwellings, which often lacked indoor plumbing, were less than ideal for their residents. But neither were they all the unsalvageable monstrosities they were made out to be—with modifications, some still exist today, and they’re worth hundreds of thousands of dollars.

The campaign to displace black Georgetown continued for decades. By 1950, black residents made up only one-tenth of Georgetown’s population, down from 50 percent or more at its peak. As part of a final push for displacement, the Old Georgetown Act of 1950 was passed. This law included a provision requiring that all Georgetown homes be updated to meet new requirements for historic accuracy, with all plans needing to be approved by a federal oversight board.

Georgetown’s remaining black residents, as the bill’s authors likely realized, were largely unable to meet the expensive new standards. The veracity with which these standards were enforced, however, varied greatly. Stories from that time period tell of black families’ homes being seized for non-compliance, given a new coat of paint, and declared fully restored and ready for resale to white families.

The Southwest Waterfront

By the time Senator John F. Kennedy was buying a Georgetown home in 1957, the theft was complete—Georgetown was almost all white and very wealthy. But across town, another half-century of theft was just getting underway.

“Urban renewal” was all the rage in the United States in the 1950s and 1960s. This renewal worked, in theory, by allowing local governments to determine areas where slum housing was prevalent. The local housing department was then empowered to seize these areas through eminent domain and redevelop them as a public good.

As problematic as that may sound, it was actually worse. Time and time again, in city after city, labeling an area a “slum” had much less to do with the condition of the area’s housing, and a great deal to do with the race of that housing’s occupants.

In DC, this process was run directly by the federal government. As we’ve written about before, federal officials declared that the working-class black neighborhood along the Southwest waterfront was, in fact, a slum.

sw dcBusinesses, like this one, did not escape Southwest DC’s demolition

The neighborhood was seized, bulldozed, and then somewhat inexplicably left mostly vacant for decades.

Just this year, the intention of that clearance has been brought to fruition. The first phase of the Wharf, DC’s new mega-development, recently opened along the Southwest waterfront. Despite receiving almost $300 million of public subsidy, it will hold just 180-odd units of affordable housing—with micro-units accounting for a third of that total. The rest of the development’s 650 units, plus hundreds more hotel rooms, will almost certainly cater to a wealthier, whiter clientele.

In this way, the twin processes complete themselves. Georgetown’s black population is long-gone, with government intervention having succeeded in moving their homes to white ownership. The Southwest waterfront neighborhood is resigned to the history books, and a mostly white, wealthy set of newcomers is now enjoying that area’s publicly subsidized amenities.

Through alley clearance and urban renewal, the federal government displaced an estimated 45,000 black Washingtonian families. To deal with the crisis they had wrought, they mandated the creation of a huge public housing network, located almost exclusively east of the Anacostia river. DC still deals with the resulting segregation and concentration of poverty to this day.

The District can and must do better. We can require that deals with public money build more affordable housing. We can support and subsidized projects that would create affordable units in high-income areas. We can increase funding for the Housing Production Trust Fund and the Home Purchase Assistance Program.

And most immediately, we can demand that plans for Phase Two at the Wharf be changed to include more and larger affordable homes. In light of our history, it would be only the smallest of first steps towards repentance.