Gentrification

There is a “boogieman” to consider. Nobody really knows what the boogieman is but, all fear him. It is a scare word, like GENTRIFICATION is to some communities.

All neighborhoods tend to either improve or degrade over time, depending on inputs. When Trader Joes grocery attempted to open a store in a food desert, in Portland I believe, the “community leaders” rallied against the potential “gentrification” of the neighborhood. Trader Joe’s said goodbye and the neighborhood remained a food desert.

Gentrification has different meanings for different groups. For those with low income, it is often thought to mean that the poor get booted out of a neighborhood because it is too expensive to remain there because of the wealth coming in. Rents and property taxes probably rise as does the cost of homes and condominiums. Streets get repaired, grocery stores open, fine dining and entertainment arrive. The problem for the poor is finding a new place to afford. And who benefits most?

Typically the original owners who bought property when it was cheap can sell at geometrically high prices. Often these are the leaders against gentrification because they fear higher property tax, and, may be still acquiring rental properties to rent to Section 8 government reimbursed renters. That’s a lot of property tax, and, if those renters leave, the demands on rental property change to needing dishwashers, garbage disposal, business center, health club, bike room, WiFi, and, all the normal needs of a gentrified community.

Those I’ve met at the last ten meetings use the “gentrification” fear without considering how asking for neighborhood development, CAUSES gentrification. Gentrification encourages city and private investment in a community. It therefore makes the community more livable, and, attractive to a more affluent population. Property values rise with rents that create gentrification.

I spoke with Amalia at Alliance of the SouthEast about this dichotomy of terms. Clearly, the “Alliance” is after neighborhood improvement. They have good intentions to improve communities. They have aligned themselves with Unions to improve things. Is this another contradiction or does it help? When work becomes available in needy communities, the Unions want and often receive that work through the City. The cost of holding a sign to slow down might rise from $10 per hour to more than $25 per hr. It definitely creates a living wage, but, for fewer than have as many people. Many jobs that could provide twice as many employees with some training may be reduced by possibly half because of limited used up budgets. Neighborhoods with 20-40% unemployment have generally a population of few union contractors (not counting government employees). The available jobs seldom impact the local community income to improve the community. There is an effort to demand local jobs with “Community Benefit Agreements” to assure some local employment benefit. This was the point of yesterday’s meeting at the ACE Tech Charter School. We were encouraged to band together so that Community Benefits Agreements are required for tax supported development. It seems a good concept if there were agreement on what best benefits the community. Some of these principles include providing a living wage, (undefined) local hiring, and affordable housing requirements for subsidized development. Each of these concepts are laudable but, too frequently misinterpreted and misdirected.

In South Shore, the dilapidated 71st street commercial district adjacent to Jeffery Plaza is supposed to begin street-scaping this month, with benches, bike lanes, sidewalks and lighting with hanging flowers. About 5% is supposed to be REQUIRED to go to local employment. Unfortunately this is not 5% of the labor budget, or of the employment as it was previously, it is 5% of the HOURS. The explanation for the change from % of employees to hours worked was that in the past, a development could hire an employee that would not be retained or show up to initiate work. The employee would be listed correctly as hired, but, never was kept on the payroll. Those locals did not ever really benefit. So, instead, this new method, was thought to improve things by using this new local HOURS method. For example, a developer can hire ten 40-hour per week union workers at $50 per hour, and, one $10 per hour local, for the same 40 hour work week. By doing this, the developer or contractor has satisfied the 5% rule and actually has 10% local employees (based on hours). Is this a community income uplift? Will this method contribute to the community being developed?

The math example given is:

• $50 x 10 employees=$500, while
• 1 x $10= $10
• $10 is 2% of the MONEY
• if employers complied by only doing 5%, it would be 1% of the money spent on labor.

A $100 million dollar project in a community would bring only $1 million in required employment.

This is the Chicago politics we need to learn to understand. We need to communicate to existing groups in a way to avoid being the messenger that gets shot, while helping reach mutual goals. So, how do we present to politicos to get development that upgrades the neighborhood that might create potential “gentrification”? At the same time we must providing the benefits of an improved community without triggering the fear of “gentrification”. We have a community that is deteriorating because it has become a dumping ground for Section 8 government housing. The deterioration process brings down property values. The churning can allow cheap purchases that historically precedes profitable gentrification and can make insiders very wealthy. It is a difficult concept for those most affected to understand.

People who lived in a neighborhood for 3 generations and see a decline, are hurt by the degradation, gang violence, and decay of streets and appearance. They want it to be as it was. It had attractive stores and quality groceries and entertainment without the shootings and relative safety. These residents are frequently the most involved community members and best educated. They want both the benefits of gentrification, without the perceived detriments of gentrification. Their message is to bring good restaurants, clubs, culture, repair, safety, violence abatement, but, don’t make it a popular place for the wealthy that will drive up rents, and taxes or prevent us from continuing to buy rental buildings at a low price.

To mutually benefit in this environment, we should try to stay between some narrow lines of improvement but, not imply too much improvement that sounds like “GENTRIFICATION”. Does that sound easy? Thom

2 responses to “Gentrification”

  1. kim milton says:

    The blog article is very interesting. How can we as a community brainstorm on improvements in our community without driving up overall prices?

    • Thom Alcazar says:

      I think it is accomplished by avoiding a knee jerk reaction to resist all change and fear it.
      Revitalization is good. With it should come a welcoming of diversity, not a thinning of diversity or changing a segregated community of underserved into a segregated community of well served.
      We learn from people of varied backgrounds and want our kids to get the broadest knowledge that will create a successful future for them.

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