Chicago affordable development mostly in poor, Black neighborhoods: report

City examines impact of federal low-income housing tax credits on segregation

Chicago /
Mar.March 16, 2021 06:00 PM
(iStock)

(iStock)

The bulk of affordable homes developed in Chicago using federal low-Income housing tax credits in recent years have been in poor and predominantly Black neighborhoods of the South and West sides.

The findings are in the city Department of Housing’s “racial equity impact assessment” released Monday. The report was touted as the first of its kind to take a comprehensive look at the tax credit program and its effect on the city population, according to WBEZ Chicago.

The assessment showed that only 25 percent of affordable homes were built “in higher-income ‘opportunity’ areas,” a fact it says has further segregated the city. The tax credits help projects pencil out because developers can sell them to for-profit interests, who use them to lower their tax liability.

“With Chicago’s long history of institutionalized racism and segregation, we are very aware of the need to examine our work and be accountable for our outcomes,” Department of Housing Commissioner Marisa Novara said in a statement announcing the assessment.

She added, “We commit to examining the results of our work by race, and based on what we learn, adjusting accordingly. Repeatedly. Given the long role that government has played in creating and maintaining segregation and inequities by race, this is our work to do.”

For the last 20 years, developers have used the low-income housing tax credit program to build or maintain about 10,000 low-income units in Chicago, WBEZ reported. Nearly two-thirds of those units are in high-poverty areas and just 20% are in neighborhoods considered majority-white, the assessment noted. It said half of the units are in neighborhoods that are considered majority Black.

Over the next two years, Chicago developers will be able to tap into $61 million of low-income housing tax credit funding.

In a statement included in Monday’s announcement, Mayor Lori Lightoot noted the city’s “history of housing discrimination and displacement of residents of color.” She said “racial equity must be at the core our efforts to mend and move forward.”

Last fall, a citywide task force formed by Lightfoot determined that an ordinance requiring developers to build more housing for low- and moderate-income households had created just 1,000 homes in 13 years. Meanwhile, the city’s affordable housing shortfall surged to nearly 120,000 homes.

[WBEZ] — Alexi Friedman


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