This Wednesday, November 28th at 11:00am in Room 400 of City Hall, a critical hearing on Darrell Clarke’s deeply flawed Inclusionary Housing bill will be held. The Philadelphia Campaign for Housing Justice urges all progressives and community activists to attend the hearing

To learn more about how Clarke’s bill differs from the bill drafted by the Philadelphia Campaign for Housing Justice (PCHJ), and why the PCHJ bill is superior to Clarke’s please visit our website:

http://www.philahousingjustice.org.

For a little broader view of the importance of Inclusionary Housing in the context of the growing problem of gentrification in Philadelphia, read on.
(Note: I am a member of the Philadelphia Campaign for Housing Justice and the webmaster of our site. However, what follows is my own view and is probably not shared by every member of the PCHJ. In addition, while both SEIU Local 32BJ and SEIU Local 1199p have played a role on the coalition, I am, again, speaking for myself not SEIU.)

Gentrification: Problems and Potential

The issue of gentrification has come up from time to time on this blog and is currently being discussed in another thread.

While pretty much all progressives worry about gentrification, I have long argued that the entry of middle and upper middle income people into working class and poor neighborhoods can actually be a good thing for everyone. (See Poverty is largely a communal not an individual problem and the greatest barriers to economic development and job creation in poor communities is not that the members of those communities are poorly educated and unskilled but that they are cut off from mainstream economic life and the opportunities that our economy once provided—and could still provide—to poorly educated and relatively unskilled people (like my great-grandparents and most of my grandparents.)

So the re-entry of black and white professionals and mangers into the city can help undo the great sin of the 1950s and 60s, that is, the creation of relatively isolated, overwhelmingly black neighborhoods that gradually lost their commercial life and their connections to the larger community.

Progressive Public Policy and Gentrification

But, to make that happen, we need progressive public policies that ensure that the reentry of the middle class into neighborhoods they fled years ago does not lead to the exit of working class and poor people from those same neighborhoods. We have to make sure that the people who lived through the bad times in Philadelphia neighborhoods are able to stick around for the good times.

With the right policies, we can use gentrification as a means of creating economically and racially integrated neighborhoods. With the wrong policies, we will compound the sins of the 50s and 60s. Poor and working class people will be pushed from the neighborhoods in which they have long lived.

Among those progressive policies we need are (1) caps on increases in property taxes; (2) investment in commercial corridors including streetscape improvements and support for neighborhood owned businesses; (3) more money for rehabilitating the homes of the poor and working class people; (4) the creation of sensible and heavily regulated financial instruments that enable poor and working class people to withdraw some of the rising value of their homes; and (5) the creation of low income housing in these neighborhoods.

Inclusionary Housing Policies

Inclusionary Housing policies are a great way—but not the only way—of improving housing in gentrifying neighborhoods. IH programs require developers to set aside a certain percentage of units in their developments, or in nearby developments, for affordable housing. Some IH programs also allow developers to put money into an affordable housing fund in-lieu of building new units.

In return for creating affordable housing, developers usually receive some incentive from the city such as a tax subsidy or zoning variance.

Under IH, if developers don’t build new market rate housing, they won’t build affordable housing. So IH works only if it is a win-win policy, one that serves both developers and those who need affordable housing. It provides incentives for building new market rate housing in n gentrifying neighborhoods while also insuring that affordable housing is built—or rehabilitated—as well.

The Problem iwth Clarke's Bill

The problem with Clarke’s bill is that it encourages developers to set aside housing that is affordable for families that earn 60 to 125% of Area Median income, that is, $43,000 to $90,000 for a family of four.

Our bill, on the other hand, aims to help families that earn less than 50% of Area Median Income, that is, $36,000 for a family of four and below.

Clarke’s bill, in other words doesn’t really help the people who most need it. In fact, because a substantial proportion of the housing built under Clarke’s bill will go to those who can afford gentrifying neighborhoods, his bill will encourage the evils of gentrification instead of constraining them. It will encourage the replacement of poor and working class people by middle class people.

There are other flaws in Clarke’s bill, which you can find described on the PCHJ website.

But the serious one, to my mind, is that it does not address the really critical issue before us—helping insure that the willingness of middle income people to reengage with urban life leads to a second wave of abuse of the working and poor people the middle class left behind thirty and forty years ago.

How to really help the middle class: fix our neighborhoods

A concern for the inequity of gentrification, I should add, is not just a matter of social justice. It is also something on which the future of our city hangs. For, if you think about it, Clarke’s bill doesn’t really help the middle class a useful way. After all, right now the middle class is not priced out of the Philadelphia housing market. There are row homes, twins, and single homes all through Philadelphia that remain affordable to those making between 60% and 125% of median income. Unlike cities like Boston and San Francisco, where the middle class is priced out of large swaths of the city, middle income people can easily find housing they can afford. The problem for our middle class is not that housing is too expensive but that neighborhoods in which that housing is found are declining. Too many middle class neighborhoods are starting to suffer from the crime, drug dealing that previously were found mainly in poorer neighborhoods. Commercial corridors all over the city are increasingly under stress.

Take, for example, neighborhood I know well in Northwest Philadelphia. Despite the prosperity and rising housing prices in Mt. Airy, our commercial corridor—which has improved a great deal in ten years—is still not what it should be. The Germantown section of Germantown Avenue is but a shadow of its former glory. Its stores are full but the quality of the merchandise available leaves many residents of Germantown cold—and shopping out of the city. And even in Chestnut Hill empty storefronts are more and more common. And Northwest Philadelphia is one area where population is growing and housing prices are going up. In other sections of the city, where housing prices are more static, residential and commercial decline is much more prevalent.

As neighborhoods decline, middle class people start to leave them. And others do not come to take their place. Many of those who leave go to the suburbs. And those who want to move back from the suburbs to the city find themselves looking at a relatively small number of neighborhoods in Center City, Chestnut Hill and Mt Airy and Overbrook and in the neighborhoods close to them that are gentrifying. Those are the neighborhoods where housing prices have really been booming in the last five years. And as prices rise, it becomes harder for middle income people to afford these neighborhoods.

We can, as Councilman Clarke wants, start giving subsidies to middle income people in these and surrounding neighborhoods. Or we can make a much wider range of neighborhoods attractive to the middle class by adopting the range of policies I described above—including Inclusionary Housing—and by improving the schools in these neighborhoods. In the long run, creating economically integrated neighborhoods will do more to keep middle class housing affordable in this city than directly subsidizing middle class housing. If IH is used, along with other policies to improve our neighborhoods we all win.