‘Green gentrification’ and lessons of the 606

A six-month development freeze around the new Northwest Side trail gives community groups a chance to explore strategies to preserve affordable housing — and park projects like El Paseo and the Obama Presidential Center could benefit from its lessons.

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Aldermen representing the area around the 606 Trail won a six-month freeze in demolition permits this month, hoping to use the time to devise strategies to reduce pressures causing the displacement of longtime residents from the area. The elevated trail and park system — a “new urban playground” — runs across the North and Northwest Sides and has spurred luxury development nearby.

Experts say that kind of planning should have taken place while the trail was still under discussion. Meanwhile, other communities are working to get ahead of the curve of outside real estate development gobbling up affordable housing, especially where park improvements are under discussion.

A recent report by the Urban Institute warns of “green gentrification,” where public investment in green spaces – like the 606 trail — can raise property values, attract development and wealthier residents, and price existing residents out of the area. “Recent research finds that by potentially denying access to park amenities, green gentrification can perpetuate poverty and reduce health benefits for low-income neighborhoods and communities of color,” according to the report. Proactive strategies are required, particularly affordable housing planning and collaboration with community members on park design and programming.

That didn’t happen with the 606. Rahm Emanuel adopted the issue in his first mayoral campaign and made it a pet project, even overriding local activists’ name for the project, which they called the Bloomingdale Trail. He also framed the goal as increasing the property tax base in the community, said Juanita Irizarry, executive director of Friends of the Parks and a lifelong resident of the area. 

It’s now five years since Irizarry and other experts exposed Emanuel’s claims that he was committed to protecting affordability in the area. It turned out the initiatives he cited included projects by community-based developers completed years earlier as well as housing vouchers, which are vulnerable to rising rents.

“If your policy is that higher tax revenues are better, you’re never motivated to address rising property taxes” or “to think creatively about how to prevent displacement,” she said. “That’s how Rahm Emanuel approached the 606.” She added, “If that was the goal, it’s working.” In 2018, Logan Square saw the highest property tax increase in Chicago — more than ten times the citywide average.

Now community residents, local aldermen, and the new administration are fighting a rearguard action, seeking to reduce the harm.

Strategies to address the housing crisis

With the ban on demolitions going into effect Feb. 1, community groups and aldermen are meeting twice monthly to work out long-term strategies for addressing the 606 housing crisis, said Christian Diaz, lead housing organizer at the Logan Square Neighborhood Association. They are exploring conducting a racial equity analysis of the 606 project to help develop a comprehensive strategy, he said.

With million-dollar homes now going up along the trail, Diaz said one major concern is the preservation of what’s termed “naturally-occurring affordable housing,” older two- to four-flats that are often occupied by their owners, who rent to friends and family members at below-market rates — the kind of home Diaz himself grew up in. “What’s happening along the 606 is that three- and four-flats are being sold and torn down for single-family homes or luxury condos,” he said. Along with displacement caused by sharply rising rents in larger rental buildings, that’s meant population loss of nearly 1,000 along the western edge of the 606 since 2011, he said. It threatens the stability and character of the community, he said.

Luxury development has also meant property taxes have risen dramatically, Diaz said. “That puts pressure on mom and pop homeowners to sell, and when they sell, they sell to developers,” who put up more high-end housing, “and the cycle continues,” he said.

The 606 was “a catalytic investment that spurred high-end development,” driving dramatic property tax increases, said Jennie Fronczak, director of development at LUCHA, a local affordable housing organization. She’s seen senior homeowners who’ve paid off their mortgage but are still squeezed beyond their means by higher taxes. “And with pressure to sell from speculators, they end up selling even if they would prefer to stay,” she said.

The question is whether amenities like the 606 “should be available to all Chicagoans or just to the very wealthy,” said Diaz.

The answer could involve reviving an earlier proposal by local aldermen to increase demolition fees near the 606. A 2017 ordinance would have raised them dramatically — from about $200 now to $300,000 and higher, with exceptions for construction of affordable housing and other factors. The funds would go to a 606 Residential Area Affordable Housing Trust Fund. Ald. Daniel La Spata has said he plans to reintroduce the proposal with a less eye-popping fee structure.

Property tax relief is badly needed, said Diaz, including “more meaningful exemptions,” a fairer assessment system, and deeper reforms that protect affordability. “There are creative ways to go about that,” he said. “What we need is political will. Restrictions on accessory dwelling units such as garden apartments, which can help owner-occupants pay the bills, need to be lifted, he said.

Irizarry adds another point: developers are known to sic city inspectors on homeowners who aren’t interested in selling. They can find minor violations that can amount to thousands of dollars. “The city needs to start tracking its building inspectors to see if they are being used as a tool of gentrification — and whether homeowners need help with repairs,” she said.

But one strategy seems certain to be central to the community’s fight against gentrification. Together with the Center for Changing Lives and the Spanish Housing Coalition, LSNA and LUCHA are launching Here To Stay, a community land trust serving Hermosa and West Logan Square. The land trust will acquire properties, do basic rehab, and sell the buildings to moderate-income residents with a 99-year ground lease. Homeowners can build limited equity and when they sell, the property will go to another moderate-income family. It’s a way to both close the affordability gap and begin to address the wealth gap, said Diaz.

Here To Stay has begun raising funds, looking for public, private, and philanthropic dollars. City funds could come from tax increment financing, and the city’s Preservation of Existing Affordable Rental program could be expanded to include affordable home ownership; unallocated state capital funding might support energy efficient repairs. Here To Stay projects that with $2 million over three years, the land trust could acquire, fix up and sell 20 small properties, providing affordable housing to 50 homeowner and renter families, Fronczak said. That’s much less expensive than new construction. One recently approved new building in the neighborhood will provide 100 affordable units at a cost of $40 million.

But with housing prices rising, time is of the essence. One problem, according to Fronczak, is that housing funders use a single metric, which is the number of affordable units delivered. But preserving homes in historically disinvested communities is far less expensive than in gentrifying areas. Fronczak said funders need to take into account access to transit, parks, shopping, schools and jobs, along with the the family connections and social networks that make a community.

Community land trusts on the rise in Chicago

Here To Stay isn’t the only community land trust getting off the ground. In Chicago Lawn, where investors have been snatching up foreclosed properties, the Chicago Community Loan Fund has partnered with the Greater Southwest Development Corp., Action Now, and the Chicago Anti-Eviction Campaign to form the Chicagoland Owners’ Land Trust. The Northwest Side Housing Center has formed a community development corporation which is planning a land trust. And in East Garfield Park, a land trust is one of the proposals that is emerging from a community planning process called Preserving Affordability Together.

Wedged between Humboldt Park and the Near West Side, East Garfield Park has started to see new housing development and new residents after decades of disinvestment. Residents have prioritized supporting longtime homeowners and exploring low-equity co-ops and a community land trust. They expect to release their plan in the coming weeks.

“Part of the problem is that a lot of affordability is lost when investors and speculators start coming in from outside,” said Juan Sebastian Arias, who’s coordinating the planning process for the Metropolitan Planning Council, working with the Garfield Park Community Council and other grassroots groups. “Wall Street is recognizing real estate as a potential source of profit. But the dynamic changes when you have community ownership.”

Community land trusts are coming into their own in Chicago, perhaps because they’re a way to prevent the displacement and depopulation that has plagued the city in recent decades, Fronczak said. In addition, “the model is so flexible, it offers different things to different communities,” she said. In historically disinvested communities, it can be calibrated to build equity and generational wealth, while in neighborhoods undergoing gentrification, it can be reset to focus primarily on preserving affordability.

Meanwhile, there are two other park developments under discussion that have raised fears of gentrification and displacement.

Lessons of the 606 for Pilsen and Little Village

There’s still time to apply the lessons of the 606 — the need for prior planning and community involvement — in Pilsen and Little Village. Inspired by the success of the 606, Emanuel in 2016 announced another rail-to-trail project, a four-mile trail on unused railroad right-of-way running from 16th and Sangoman to 32nd and Central Park and connecting the two historically Mexican-American working class neighborhoods. It’s been dubbed El Paseo.

Community groups had long discussed reclaiming the rail tracks as green space, but the idea of a trail connecting the two neighborhoods came from city planners, said Simone Alexander of Únete La Villita, a grassroots Little VIllage group focused on affordability and accountable development. And it immediately raised fears of displacement, according to both Alexander and Moises Moreno of Pilsen Alliance.

Both communities face pressure from development, but Pilsen — close to the West Loop, where housing costs are soaring — is much further along. More than 10,000 Latinos have moved out of the neighborhood in the past two decades, according to Pilsen Alliance. “We see this as a battleground,” Moreno said. Modest, historic homes which housed working-class families are being torn down and replaced by stacks of condos for new residents. The community has fought back, even electing anti-displacement activist Byron Sigcho-Lopez alderman last year. But demolitions are continuing, Moreno said — in part due to a rush of applications for demolition permits when longtime, developer-friendly Ald. Danny Solis announced his retirement under a cloud of scandal.

Rents are also rising in Little Village — in part because the area was hard hit in the foreclosure crisis and banks acquired many properties — and developers are knocking on doors and calling inspectors on uncooperative homeowners, Alexander said. In nearby Douglas Park, the success of Riot Fest has increased interest in the community from more affluent outsiders, she said.

In 2018, Emanuel and local aldermen announced a pilot increasing affordable unit requirements for developments with over ten units and providing some money for affordable housing. Moreno and Alexander said it wasn’t enough. “There was no protection to prevent displacement,” said Moreno. Pilsen Alliance and Únete sponsored a referendum last year in precincts around the proposed Paseo, and more than 80% of voters backed the demand, which would include higher affordable requirements, a property tax freeze, and funding for local jobs and housing.

Announcing El Paseo, Emanuel proposed an aggressive timeline, but he failed to pull it off. Acquisition and remediation proved challenging, and controversy over the impact of the 606 seems to have dampened enthusiasm on the part of city planners.

Alexander said that door-knocking and community meetings have revealed that many people living right next to the proposed trail don’t know about the city’s plans. She said that rather than responding to a proposal from the city, local activists are working to reclaim the initiative and resume the community-driven planning process.

Around the proposed Obama Presidential Center in Jackson Park, however, gentrification has been given a head start. It’s unfortunate that former President Barack Obama pooh-poohed fears of displacement and his foundation declined to discuss protections for low-income residents of Woodlawn. Though groundbreaking for the center itself has been postponed repeatedly, the real estate market in the surrounding area hasn’t waited. Home prices are up, rents are up, and many neighborhood residents — 62% of whom are rent-burdened, according to one study — are feeling vulnerable.

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Lightfoot and the Obama center 

And though voters in Woodlawn precincts overwhelmingly backed a comprehensive community benefits ordinance in a referendum last year, Mayor Lori Lightfoot’s administration has come out with a somewhat watered-down version. In particular, affordability requirements for new development will have to wait until a task force studying the Affordable Requirements Ordinance issues recommendations, months from now. The Coalition for an Obama Center CBA has pointed out that higher affordability requirements have already been implemented in other communities where displacement is a threat. The group is also calling for setting affordability standards at a level appropriate for community residents.

In contrast to Emanuel’s purported 606 housing initiative, Lightfoot’s plan (which will be presented at a meeting Jan. 30 at Hyde Park High School) does include several new initiatives — including a right of first refusal for tenant associations to partner with nonprofit housing developers when buildings go on the market, a commitment to using city-owned vacant land for affordable and mixed-income housing, and financial assistance for homeowner repairs and for acquiring and rehabbing vacant residential buildings.

Tuesday, the CBA Coalition came out against the ordinance, calling it inadequate, and 20th Ward Ald. Jeanette Taylor said she would oppose it.

Calling the proposed framework “a first step” that reflects broad community input, Department of Housing spokesperson Don Terry emphasized in a statement that “we are committed to working in earnest with the Woodlawn community and a wide range of stakeholders to advance more comprehensive policies that will expand access to affordable housing more broadly.”

Whether it’s enough to stem the tide at this late date remains to be seen. I’m not sure the goal should be to ignore community input and rush through the federal review process in order to break ground as soon as possible, as Lightfoot told the Sun-Times this week. It would be a shame if one of Barack Obama’s legacies was the lesson — previously learned at the 606 — that big development projects require advance planning to address housing inflation and displacement.