How to stop displacement
The current approach to neighborhood well-being can transform Third Ward but cannot protect it.
When it comes to neighborhood well-being, is failure the inevitable cost of success? Consider this familiar story from Providence, R.I. In its salad days, the neighborhood of Olneyville was home to a thriving textile industry. But the looms went quiet long ago, and for much of the 20th century it was one of the most distressed places in the state. In 1978, the Providence Planning Department found that over half of Olneyville’s houses needed “immediate attention,” were in a state of “advanced deterioration” or were “heavily deteriorated and dilapidated.”
Today, people reach for different words when they describe Olneyville: Hip. Trendy. Chic. Neighborhood nonprofits converted a sprawling, toxic dump into a prizewinning park. A community development corporation replaced scores of vacant lots and abandoned buildings with below-market rate housing. School officials remade a local elementary school into a treasured neighborhood anchor.
But the victories that low-income residents and their allies worked so hard to achieve brought the neighborhood to the attention of an entirely new demographic. Olneyville in the 21st century has also become whiter, significantly more unequal, and substantially more expensive. Gentrification now threatens the Latinx community that has called Olneyville home since the 1990s.
Of course, what is happening in Olneyville is happening across the country, including in Houston. In a 2018 ranking of the 20 fastest gentrifying ZIP codes in the country, two were in Houston. No other city except Brooklyn had more than one. In one of those 20, the ZIP code for the Washington Avenue Corridor, home values climbed 107 percent, household income increased 114 percent and the number of people with at least a bachelor’s degree rose 188 percent.
The same forces also threaten the historically Black Third Ward. In 2010, nearly 3 in 4 residents of Third Ward were African American. Today, the figure is less than half. In eight short years between 2010 and 2018, the non-Hispanic white population in Third Ward increased by 150 percent and the percent of the population with a college degree more than doubled. And in just half that time — from 2010 to 2014 — average home prices in Third Ward increased by 85
percent.
The lesson is that America’s current approach to neighborhood well-being can transform places like Olneyville or Third Ward but cannot protect them. This poses morally urgent questions: Do the ploughshares we use to improve a neighborhood become the swords that destroy it? In the wealthiest country on earth, can it really be that the poor only get to live in wretched places? Is it simply impossible to create a low-income neighborhood that is also safe, healthy, vibrant and sustainably affordable?
I spent four years studying Olneyville’s transformation — research that started quite by accident. I went to Providence in 2017 to learn about its police department, which was said to have transformed from a corrupt, brutal, paramilitary organization in the 20th century to a national model of community policing in the 21st.
The neighborhood where the new department had made the biggest impact was Olneyville, where crime rates plummeted and residents forged a new link to the police. In talking to residents and activists about the shift, however, I realized that policing was only part of the story. Olneyville also needed affordable housing, ample green space, healthy food and good schools. Yet, paradoxically, as Olneyville residents and their allies tackled these vexing problems, their home became both more livable and more vulnerable.
Like in Third Ward, average rents in the neighborhood climbed over 54 percent between 2000 and 2018, more than twice the citywide average. “That’s not transformation for the neighborhood,” longtime Latina advocate Delia Rodriguez-Masjoan told me of the new restaurants and coffee shops popping up around her. “It’s not gonna be the same neighborhood.”
There are no villains in this story. At least, none with blood and bones. The people and organizations that serve Olneyville residents don’t want to be agents of destruction. But they are part of a system beset by two fundamental problems.
First, policymakers hew to the neoliberal notion that social problems are better solved by the private sector than by government (which cannot solve social problems because it is too inefficient, bloated and sclerotic, the thinking goes). So the principal role of government in a distressed neighborhood like Olneyville is to create opportunities for private investors. Take housing, for instance. The federal government has not added meaningfully to the nation’s store of housing owned by the Department of Housing and Urban Development for decades. Instead, it uses vouchers and tax breaks to create financial incentives for landlords and developers to provide shelter for some (but nowhere near all) of the people who cannot afford housing at market rates. Responsibility for housing these people has shifted from government itself to private actors, including nonprofits, who are paid by the government to create housing at below market rates.
Most of the new homes and apartments built in Olneyville were financed through such programs. But this public funding is not remotely enough to house all who need shelter, or to stabilize rents at levels that are affordable to the lowest-income residents. Even rents set at 50 percent of the area median income are beyond the reach of most Olneyville residents, where 1 in 5 households survives on less than $10,000 per year.
The second fundamental problem is equally serious but more pernicious. The current approach to neighborhood well-being empowers a small army of nonprofits and community development corporations that tend to be managed, staffed and funded by well-intended and comparatively well-heeled whites who typically do not live in or come from the neighborhoods they serve.
As a result, outsiders, rather than low-income residents, decide how to spend the money that flows into the neighborhood. Outsiders establish connections with politicians and funders throughout the region, and reap the social and political capital that comes from these connections. Outsiders become leaders; residents become supplicants.
In short, the tools available in a neoliberal age will never prevent capital from overrunning a place like Olneyville and will never equip its victims to fight back.
The solution is to fund and empower the poor rather than the wealthy. Give low-income residents ownership and control of neighborhood assets, including the money that flows in from outside. Place the assets in trust for the permanent benefit of low-income residents, and deploy them to make property sustainably affordable. Pair investment with state or federal tax credits to augment those assets, but only on the explicit condition that money that flows into the neighborhood be controlled entirely by low-income residents and their chosen allies.
Community land trusts offer one tool to keep housing affordable. In the classic CLT, the purchaser owns the home, but the land is held in trust for the longterm benefit of local residents. Because the purchaser only owns the structure and not the land beneath it, she can buy it at an affordable price. In exchange, she gives up the right to sell the home for whatever price the market could demand. Instead, she agrees to sell to another lowincome purchaser at a price which preserves neighborhood affordability while still providing her a modest profit on her investment. In this way, CLTs protect low-income neighborhoods by removing property from the speculative frenzy of a gentrifying area.
Some complain that CLTs deprive a homeowner of the chance to cash in on gentrification. But no one is forced to buy a house in the trust; those who can afford to buy on the open market are free to do so. For those who can’t, the CLT provides most of the benefits of home ownership, allows the owner to build her credit so she can qualify for a conventional mortgage down the road, and preserves neighborhood affordability for the next low-income owner.
Houston has a community land trust. It’s new and as of 2020, only included 21 homes. But it has a goal of bringing 1,000 homes within the trust by 2028, which would be a great contribution to sustainable affordability.
A healthy neighborhood is more than the places we live and shop. It’s also fresh food, ample green space, well-funded afterschool programs, secure child care, cutting-edge job training and a host of other initiatives. In Olneyville, as in most cities around the country, these needs are provided by nonprofits that are funded and staffed by outsiders. That has to change.
All of the programs that now lace through a distressed neighborhood like Third Ward should be controlled by the low-income people who live there, and all the assets should be held in trust — one that meets the overlapping needs of the whole neighborhood.
I call this solution a neighborhood trust — and several organizations have begun to implement and improve upon my idea. The Kensington Corridor Trust, the first of its type in the country, is acquiring real estate assets along a commercial corridor in a badly distressed neighborhood in Philadelphia and removing them from the market for the benefit of the residents and small business owners in the neighborhood.
The organization plans to create a vibrant, sustainable mix of affordable residential and commercial rental units along Kensington Avenue, the commercial heart of the neighborhood — with culturally desirable businesses that provide affordable goods and services and create secure, high-paying jobs at the street-level and affordable apartments on the floors above. Keeping these assets in the trust ensures permanent affordability and guarantees that the neighborhood captures any increases in the land’s value.
Another model is taking shape in the Midwest. Trust Neighborhoods, based in Kansas City, helps distressed neighborhoods set up and run trusts themselves, finding outside capital for funding, getting existing neighborhood organizations involved in operations — and, again, removing assets from the private market to hold within the trust for the permanent benefit of low-income neighborhood residents. They call their model a MINT, for mixed-income neighborhood trust. Market-rate tenants live in units owned by the trust, and the rent they pay subsidizes lowincome tenants renting at belowmarket rates nearby — perhaps upstairs in a duplex, or next door. The hope is that a mix of low-income and market-rate tenants, all renting from the trust, will protect the entire neighborhood.
Neighborhoods in Tulsa and Kansas City have already created MINTs. Trust Neighborhoods expects another five neighborhoods will do so by the end of 2021, and is in discussions with representatives from more than 100 other low-income neighborhoods across the country.
Is a neighborhood trust possible in Houston? I believe it is. Third Ward has all the ingredients to make it happen, if they can lock in sustainable affordability at scale and give the poor ownership and control of neighborhood assets.
By itself, a neighborhood trust will not solve all the problems that confront a place like Olneyville or Third Ward. It will not stop climate change, revive the manufacturing sector or make people tolerant. It will not end racism, classism or xenophobia. But it will give poor residents ownership and control of the wealth that flows into their neighborhoods. It will let them permanently capture increases in the value of land, invest and manage their capital, and deploy assets as they see fit. It will restore some of the wealth and social capital that have been drained away by decades of disinvestment and neglect. And that, in turn, will give the poor something they have never had in this country: power.