Poor Public Housing

The Chicago Tribune had a lengthy story earlier this week about what they call Chicago's grand experiment to transform public housing.

The Trib's investigative team found that after the ninth year of a 10 year plan, the city had only completed 30 percent of its plan to tear down housing projects and replaced them with mixed-income neighborhoods. They tell a tale of city insiders getting rich, while more than 56,000 people are on a waiting list for public housing, a list that has been closed since 2001.

(I talked to Robert Lipscomb about Memphis public housing in April and he told me that when HUD issued new Memphis public housing vouchers two years ago, more than 21,000 people applied for 600 vouchers.

I had heard that people applying for public assistance were told it would take at least two years to get into public housing and as many as four years to get on Section 8. At the time, Lipscomb admitted that it could take several years. "It's supply and demand," he said. "Demand is not going away and supply is a problem.)

But the already struggling Chicago experiment is threatened — and this may interest Memphians — by the housing market bust.

In the mixed-use developments, the construction of public housing was contingent on the sale of market-rate housing. Sure, developers were getting public subsidies to build town homes and condos, but the plan was to use that part of the development to pay for affordable housing.

From the story:

"In interviews with the Tribune, city and Habitat officials now say they need to reconsider some of their strategies. Valerie Jarrett, Habitat's chief executive, said the company will seek the advice of housing experts from across the country and also ask developers to come up with new ideas.

The sputtering effort also has translated into higher costs—with some public housing units totaling more than $300,000 to build, more than the price of a home in many Chicago neighborhoods. ...

The consequences of these failures go far beyond Chicago. The federal government also prodded dozens of cities across the country to adopt similar blueprints for fixing their public housing sites. Since then, many of those projects have stalled as well."