Category: Economic Segregation

By Cynthia Spielman, For the Express-News Jan. 28, 2020

“The more intensely we build in our inner-city neighborhoods, the more affordable the housing.” We hear it from city staff and from our elected officials. It is no wonder this idea has become the rationale for much of the recent developer-driven city policy on infill.

This seems reasonable on the surface. The more housing we build, the more affordable it becomes: supply and demand. The model of supply and demand is an old and simplistic one that belies the reality that affordability is a complex process, particularly when applied to San Antonio’s housing.

Intense development is not producing affordable housing in our inner-city neighborhoods. On the contrary, it is producing market rate (expensive) housing that drives up land values through property valuation and speculation. This practice results in displacement and increases the income segregation in this city. Often affordable “middle” (duplex, triplex, and fourplex) housing has been demolished and its residents displaced to make room for expensive new construction. The density stays the same; the land values rise.

Incompatible and expensive development destabilizes resilient communities and destroys the neighborhoods in which they live. A recent study, “Opportunity at Risk: San Antonio’s Older Affordable Housing Stock,” prepared for the San Antonio Office of Historic Preservation (OHP) by PlaceEconomics (2019) shows that much of San Antonio’s affordable housing was built before 1960 and that this affordable housing (rental and owner-occupied) is disappearing quickly to make way for market-rate rental and condo units. The most affordable housing is the housing we live in now and it is disappearing quickly.

Manhattan, San Francisco, and Chicago are very dense and very expensive. Density does not necessarily lead to affordability as recent studies have pointed out: It is not how much you build, but what you build.

The argument for density, even if it is market rate, is that eventually, as the new structures age, or as another part of town becomes desirable, those who can will move into newer or more attractive neighborhoods, and their old housing will become available and will cause rents and house prices in their old neighborhood to fall.

Theoretically, this makes sense. But in reality, significant obstacles inhibit the affordable housing this model predicts. For instance, much of the new housing being incentivized and encouraged by the city is infill development — building within our existing neighborhoods. This new development is quite expensive causing surrounding properties to rise in value — thus the dreaded property tax hike that is pushing many of us out of our original neighborhoods (we can afford our mortgages, but not our taxes!). This model assumes that used housing — not unlike used cars — will filter down to lower and lower income families, yet by the time it does, it often requires significant investment to make it livable once again.

The question often asked is how (or why) did our housing stock deteriorate to the point that low-income housing is practically uninhabitable? The two most compelling answers would be, first, the lack of available investment dollars through the mid 20th century due to redlining policies that steered investment capital into the suburbs; and, second, the gradual shift through a house’s life from being owner-occupied to being renter-occupied. When a house becomes renter-occupied, it is an investment. As an investment, it may make better financial sense to defer maintenance— and the house deteriorates.

The solutions that help stabilize our neighborhoods, while producing more affordable housing, include building affordable housing on vacant lots that is compatible not only in design, but also in value to the neighborhood and does not impact the housing market. We need to ensure equity in investment across all of our neighborhoods. The city needs to incentivize and help with the rehabbing of declining housing stock so that vulnerable residents can stay put.

The Task Force for Removing Barriers to Affordable Housing proposes the construction of accessory dwelling units to provide the much needed “middle housing“ that is being demolished in our neighborhoods. Accessory dwelling units can provide rental property to offset rising taxes for the homeowner, and they can provide affordable housing that is compatible with the surrounding neighborhood.

To adequately address the problem of the housing crisis we need to build affordable housing along our transportation corridors and in our regional centers. By building on empty and/or blighted retail space, we would meet the projected need for affordable housing and adhere to the SA Tomorrow Comprehensive Plan. At the same time, we would be building infill that is compatible to our neighborhoods in both design and cost.

San Antonio’s leadership cannot expect to solve the crisis of the affordable housing shortage by making decisions based on business adages such as “supply and demand” that do not correlate to the human element in housing. San Antonio’s inner-city neighborhoods are too fragile and many of its residents too vulnerable to survive if we get this wrong. Those of you elected to represent us must be visionaries who do not lose sight of the needs of your most vulnerable constituents.Cynthia Spielman serves on the Steering Committee of the Tier One Neighborhood Coalition. Email: t1nc.sat@gmail.com

The County Commissioners recently released its Tax Abatement Guidelines effective January 31, 2018 – December 31, 2020 which incentivizes market rate multi-family rental housing in the Center City. The Commission also released its Bexar County Skills Development Fund for Economic Development which incentivizes companies or businesses with twenty (20) or more employees to train new employees and pay the targeted Occupation Positions no less than $17.44 and no employee at project site less than $11.32 excluding benefits. Only 25% of the new employees are required to be Bexar County residents.

Precinct Four County Commissioner Tommy Calvert wrote an open letter, “Bexar County’s New Incentive Policy Benefits Top 10% Again” decrying the the fact that the proposal allows “only the top 10% of the larges businesses to train and hire 75% of people from out of town after you give them $250,000 for workforce training.” He states his objection to the abatement policy: “…When I asked the court to work with me to provide a market incentive to balance the decade long policy where Bexar County only gave tax abatements for multi-family developments that called for the highest rents and highest mortgages and put in place policies that benefit the vast majority of working people, the staff and court has provide (sic) inaction and excuses.”

On February 8, 2018, Commissioner Calvert held a Neighborhood Reinvestment Fund Committee Meeting at the DoSeum in which he discussed with community and business leaders the proposals and asked for solutions. Hans shot up across the large and crowded room. What happened next was a lively, diverse, and informative discussion of solutions.

In San Antonio, a city with high economic/geographic segregation, where zip code determines fate, affordable housing is tied to opportunity – jobs and education and health.   Our tax dollars should be used to encourage workforce and affordable housing and helping people stay in their homes, not to incentivize market rate housing that most of the hard working citizens of San Antonio can ill afford.

The kind of incentivizing of development and market-rate housing that the Commissioners propose has led to displacement in our downtown neighborhoods. As home prices shoot up, my neighbor Danny stands before me and says he is struggling to stay in the home he grew up in, a home he has cared for and a neighborhood that is the only one he has known. “People tell me that my house is an investment,” he says, “But it is not an investment: It is my home! Where would I go?” We need funds for owner-occupied home rehab and neighborhood reinvestment and tax relief.  Another neighbor, at my kitchen table, demands that we stop improving the neighborhood because she can’t afford it. We shouldn’t have to stop improving our neighborhoods in order to help people stay in their communities, but we should mitigate the unintended consequences of incentivized market rate development. If in n Beacon Hill and other downtown neighborhoods, the affordable housing is the still housing we live in now, it may not be for long.

Median-income households can afford less than half of the homes on the market, making the local housing market inherently unaffordable. The statistics on renters are worse yet: Renters compose 47% of the the housed population.  As of 2010, more than half of renter households in Bexar County would not have been able to afford the two-bedroom fair market rent that requires an income of at least $33,680 or $16.19 per hour over a 40-hour work week.  The average Bexar County worker earned $12.18. Since the Comprehensive Housing Needs Assessment and Strategic Housing Plan of San Antonio (which produced these figures) was produced in 2013, the housing situation has only worsened. Rents have steadily risen.

Teachers, firefighters, City staff, architects, healthcare workers, those at the 80% of AMI, whether they be renters or homeowners, are finding themselves priced out of the San Antonio downtown area. If renters stay, they struggle to pay unaffordable rent which can prevent them from achieving the dream of home ownership. Homeowners may soon join their ranks.

What we need is training programs for Bexar County residents, higher wages, the development of skilled industries (not tourism), and a way for neighborhood  students to have access to to a decent education. What we need is housing that is affordable and  neighborhoods that are resilient.

The SA Tomorrow Comprehensive Plan requires that developments that receive public funding or use public financing tools, provide affordable housing units – an important objective that this Commissioners Court has failed to require.

According to NALCAB’s recent study, “An Analysis of Housing Vulnerability in San Antonio” produced in January of this year, public policy and incentives that are proposed here have helped to make rental housing unaffordable.  The highest multifamily effective rents were in areas with high concentrations of new production, often incentivized production.

In other words, the City incentivized an unaffordable rental housing market, using our tax dollars to worsen a housing crises. Now the County, learning nothing from the City’s errors, seems to be proposing to do the very same thing. It does not make any sense.

There is nothing wrong with market rate housing which will proliferate on its own as the market grows; but our tax dollars should be used to incentivize affordable and workforce housing and training that benefits the citizens of Bexar County, not just the market rate development community or corporations.

I understand the desire to raise the tax base by incentivizing market rate housing, but we can do that by raising the living standards of our citizens through education, opportunity, and housing.

On February 13^th, after two hours of presentations (notably by Dr. Christine Drennon of Trinity University and SAISD Superintendent Pedro Martinez) and citizen input, Commissioner Calvert was able to successfully persuade the Commissioners Court to hire a housing consultant and create a citizen –staffed advisory committee. County Commissioner Tommy Calvert should be commended for working for affordable housing and seeking public engagement as the process.