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The St Louis Contrarian

Providing Independent and Intelligent Insight on St. Louis Public Policy Issues

Archive for the tag “st. louis”

Hope vi

Hope VI is a now discontinued public housing program that completely rehabilitated distressed public housing projects in this country.   The idea behind the program was to combine physical rehabilitation social services and create mixed income communities. I had the opportunity to work on the Darst Webbe program in the near south side.  That program has been successful in creating a mixed income community and has led to improvements in surrounding neighborhoods. 

Recent research has evaluated HOPE VI.  The program has not really transformed lives and it was noted that displaced public housing residents did not readily move back 

I believe the program has provided urban development benefits but has not significantly improved the lives of residents. The cost is quite high and demolition and new construction may have been cheaper. The jury is still out on mixed income housing. I have serious doubts that given a choice anyone would opt for this type of housing 

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Economic Development Agencies in St. Louis

I have always wondered about Economic Development Agencies. Lately there appears to be great turmoil at the Regional Chamber directed toward its’ President Joe Regan. All I know about that is what I read in the newspapers The Post had an extensive story about it today. What is curious to me is that apparently Mr. Regan’s alleged abusive behavior was also evident in his previous job in Louisville. Why did they hire him? Did they check his background?

More important, what do these agencies accomplish? They provide huge salaries to their staff, but what are the certifiable outcomes? What have been their legislative accomplishments in Jefferson City? I am going to write more about this topic in the future with data to back me up. I would like to hear of your experiences with these organizations

Low Income Housing Tax Credits

Low income housing tax credits are the primary source of construction and rehabilitation for affordable housing projects. The program has been around since the eighties and is an effort to get private sector involvement in the affordable housing development business. The program uses the equity generated from the sale of tax credits to create low debt on affordable housing projects, thereby supporting lower rents. (This is a vast oversimplification but sufficient for this discussion.)

The program has accomplished much but has significant limitations. It is neither efficient or effective. Let me explain.

The program is not efficient for two reasons. First it is excessively complicated, involving arcane aspects of tax law, legal issues, accounting etc. It is an extremely difficult program for a newcomer to enter. Second, and related, the administrative costs are extremely high. Too much of the money does not go directly to housing but lines the pockets of developers, consultants, syndicators, accountants, attorneys, etc.

Second, the program is relatively ineffective. It does not house the low income people who need it the most. Someone must be able to pay a decent rent to afford the program. Homeless or very low income people cannot participate.

Politically this is not the best time to address the need for a new affordable housing program but the community needs it. The National Affordable Housing Trust Fund is a start but its resources are limited for now. We need a simpler more efficient and effective affordable housing program.

Mentoring

I have volunteered as a mentor to young boys on several occasions. In all cases both the mentor and I have found it to be a positive experience 

In a previous post I have commented on the  positive outcomes at St. DLouis city Academy resulting from strong parental involvement. Mentoring can at least be a partial solution to help kids not fortunate enough to have parents or other family members available.  This also applies to prevention if criminal behavior 

I am calling for mentoring programs for all at risk children and families. Much if this can be accomplished by extensive volunteer efforts. Organizations such as Big Brothers/Big Sisters already Dinan outstanding job. Funding will also be necessary. It will be funding very well spent 

Mortgage Interest Deduction

The mortgage interest deduction on federal income tax is by far the biggest housing subsidy available. It far surpasses Section 8, LIHTC, or other forms of subsidy. The major problem with this subsidy is because it primarily benefits higher income households. That is because a tax deduction only benefits households who itemize and those with a more substantial tax burden. Most of the benefit of this deduction goes to households earning over $200,000 a year. This program hurts central cities more than suburbs for the following reasons:

1. As stated before, less expensive houses provide less of a deduction to affluent purchasers. The present system actually provides incentives for middle and upper middle income households to buy more expensive homes which are generally located in suburbs.

2. Renters who are more common in the central city receive not subsidy at all.

The National Low Income Housing Coalition has a United for Homes campaign which attempts to rectify the housing tax deduction issue. The policy they advocated would limit deductions to $500000 of interest, and provide a 15% tax credit to households which would much more adequately address the needs of lower income homeowners. The billions in cost savings would be used to subsidize new affordable housing. Check out the website Unitedforhomes.org

Urban Homesteading

I wanted to write again about Urban Homesteading, a program which I believe would be transformative for St. Louis and other communities. My previous work with this program in Milwaukee inspires my vision.

St. Louis has lots of vacant boarded houses in city possession. Urban Homesteading would allow for the transfer of these houses to individuals and families who agree to live in the houses and rehabilitate them to code. Title would transfer to the homesteader after successful completion of the rehabilitation. Some important caveats:

1. The rehab would need to be completed by professional contractors approved by the city. Sweat equity does not work in these situations.

2. The families selected for the program must be working and pass a screening. This will not work for people with significant social problems.

3. The properties must be carefully selected. They should be as close together as possible, and in a condition that allows for rehab.

St. Louis is working hard to attract young people to the city. This program can significantly help that effort.

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