What’s Behind D.C.’s Gentrification Rating Drop?

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What's Behind D.C.'s Gentrification Ranking Drop?

If the coronavirus pandemic has laid bare racial and economic injustice in America, then nowhere is this truer than in our nation’s capital, one of the most unequal and highly gentrified cities in the country. 

Over the past twenty years, gentrification has exploded across the country, but D.C. is unique in that it has experienced a veritable tidal wave of displacement. For much of that time, it ranked as America’s most intensely gentrifying city, with roughly 40 percent of low income neighborhoods experiencing displacement and a minimum estimate of 20,000 Black Washingtonians pushed out between the years 2000 and 2010, according to a study, based on U.S. Census Bureau and economic data, released in 2019 by the National Community Reinvestment Coalition. (Advocates interviewed for this story say the real number is far, far higher.)

And yet, in June, the same group issued a follow up report measuring the years 2013 to 2017 with a surprise result: D.C. dropped from 1st in gentrification to 13th, as the pace of gentrification surged elsewhere. So what happened in D.C.?

The question lays bare confusion surrounding the drivers of gentrification, and a stark disagreement between members of D.C.’s “smart growth” development community and anti-displacement activists who are deeply skeptical of smart growthers’ claims. Both sides share a stated goal of creating and protecting affordable housing, and there the similarities stop. It’s as if they are describing different versions of reality. 

Where smart growth advocates view the affordable housing crisis as a problem of supply and demand, and claim the best way to proceed is to continue growing and building intelligently, in tandem with other environmental and transportation needs, the displacement activists counter that this approach only sounds like more of the same. They insist gentrification is essentially a city-led phenomenon, and that smart growth gives it cover, or moral justification, kicking the can down the road under a false promise that someday market rate housing will become affordable, and struggling residents, most of them people of color, will not be pushed out to make way for upwardly mobile Whites.

With the pandemic continuing to rock D.C., and important developments in city housing policy raising the stakes of the game, their disagreement only comes into sharper focus.

Ari Theresa, a civil rights attorney based in Anacostia, believes that the drop from 1st to 13th can largely be explained by a slew of legal appeals that he and other residents and neighborhood groups filed against development projects beginning in 2013, the same year the second NCRC gentrification study started measuring the displacement. 

Theresa believes that D.C.’s gentrification is a direct result of city planning and housing policy. Along with the Georgetown University Law Civil Rights Clinic, he is suing the District government on behalf of a host of predominantly Black clients and community groups who filed appeals against developments which they say were illegally and routinely mishandled or ignored.

“The District of Columbia has staked its future on attracting a ‘Creative Class’ of millennials who work in so-called creative professions,” his lawsuit reads.“In pursuit of this vision of a younger and wealthier D.C. the District of Columbia’s agencies have leveraged land use and housing policies to create segregated enclaves for 18- to 34- year-olds in favored professions at the expense of long time African American residents.”

In illustrating how this “vision” came to be, Theresa points to a series of planning documents that were issued beginning in 2007 during Mayor Adrian Fenty’s administration, when smart growth trailblazer Harriet Tregoning directed the Office of Planning.

In a 2007 press release, the city announced its “Creative Economy Initiative,” referencing a planning summit which explored how the District “can leverage its creative economy to transform neighborhoods and contribute to DC’s overall economic vibrancy.” In 2010, the Office of Planning published another report, titled the “Creative DC Action Agenda.”  In 2014, yet another report was issued, the “Creative Economy Strategy,” and in 2016, the “Creative Plan DC.” 

According to Theresa’s lawsuit, this stated desire to turn D.C. into a mecca for the creative class was subsequently accompanied by “a pattern and practice of discrimination and disparate treatment against African American residents living in predominantly African American neighborhoods.”

In short, Theresa argues that District residents and community groups in formerly or presently predominantly Black neighborhoods like Buzzard Point, Union Market, and Barry Farm constantly got the run-around when lodging appeals against developments they felt would negatively impact their community and bring about gentrification and displacement. 

On numerous occasions, Black residents were denied statutorily required impact assessment reports, his lawsuit asserts, while wealthier White counterparts in other parts of the city never even had to ask.

Theresa cites the planned redevelopment of the Barry Farm public housing complex in Southeast into a “mixed use, mixed income community” as an instance when a neighborhood group opposing the development was mistreated. The group, called the Barry Farm Tenants & Allies Association, was wrongly denied party status—or the ability to file an appeal—by the Zoning Commision, the lawsuit contends. Additionally, the Zoning Commission “failed to provide residents with findings of fact regarding gentrification and the development’s impact on housing.”

In the end, the Zoning Commission reversed the decision and granted the group party status, but only let them know “on the date of the subsequent hearing, [the] resident’s final opportunity to be heard before the Commision. As a result, [the group] and its members could not adequately prepare testimony, expert witnesses or cross examination.”

Another predominantly Black neighborhood group representing residents from Union Market objected to “high density projects, including 6000 units of studios and one bedroom apartments,” and faced similar treatment. 

According to Theresa, displacement is intricately tied to the proliferation of Planned Unit Developments, or PUDs, which allow developers to build more than a site’s current zoning allows—typically by adding density in the form of one and two bedroom apartments, or studios—in exchange for a commitment to include a certain number of affordable units. 

“Wherever you see that PUD projects are the most concentrated, that’s where you see the most displacement,” he tells City Paper, specifically pointing to the area around Union Market.

The 2.34 square miles that comprise the neighborhood saw 20 PUDs approved between 2010 and 2018, his lawsuit contends—a time period that saw a total of 90 PUDs approved in D.C.—forming the highest density of PUDs in the city. 

In 2010, the neighborhood had a population of more than 31,000 people, 63 percent of whom were African American and 28 percent of whom were White, according to Theresa’s lawsuit. By 2018, that population had grown to 42,630, with the Black population falling to 28.5 percent and the White population soaring to nearly 50 percent. 

“Between 2010 and 2018, approximately 39,000 African Americans were displaced from DC,” the lawsuit states, and if not for the appeals, Theresa and others contend that number would have been even worse. 

Development and displacement was on a rampage in D.C. until 2013, when a court case known as Durant v. District of Columbia Zoning Commission—nicknamed “Monroe” in development circles in reference to the name of the project in question—reversed legal precedent and opened the floodgates for PUD appeals.

A 2017 article from the D.C.-based development journal Bis Now reads: 

“These appeals, and the willingness of judges to see them through, have become more frequent in recent years. Fifty-seven zoning appeals have been filed in the D.C. Court of Appeals since the start of 2013, the year the 901 Monroe project was first blocked, compared with 28 appeals filed between 2000 and 2012. Before 901 Monroe, the last time the court remanded a project back to the Zoning Commission was in 1995.”

Most of the appeals were thrown out. But in the course of being heard, they stalled projects by a number of months, and even years, sending a “chilling effect” through the marketplace. 

“In 2018, the number of PUDs dropped to three,” Theresa says. “Traditionally there would be about 10 or 15 a year. But by 2018, they had only done three, because they couldn’t get them financed. Everyone knew it was going to end up in court.”

Before Monroe, it was pretty much a development bonanza, says William Jordan, a former ANC 1A commissioner who lives in Columbia Heights. Jordan is an outspoken critic of smart growth. 

Back in the early 2000s, the process was different, he says, especially where public land and subsidies were involved. 

“Back then, it was more of a community development process,” he says, where neighborhoods and civic associations drafted community plans that developers had to respond to. “But today it’s become completely developer-driven, a growth-driven process, where the developer pitches and the community basically responds to what they pitch.”

“It’s kinda like Einstein’s theory of relativity,” he says. “It’s from the perspective of the observer. And before, the observer was more the community.”

According to Jordan, the origins of this switch run deep, dating back to D.C. ‘s budgetarily troubled days in the 1990s, when development was mostly focused downtown or out in the suburbs. In those days, residential neighborhoods had more political control over the process of development. 

But when Congress established the District of Columbia Financial Control Board in 1995 to oversee the city’s finances, “they began to restructure the city so that it was more attractive to pension funds, insurance companies, unions, and big capital that could finance large buildings and large projects,” Jordan says. Large plots of land were transferred to holding companies like the National Capital Revitalization Corporation, which had their own boards and interfaced with neighborhoods on development plans. 

In the new millennium, the city dissolved the holding companies and took a direct hand in real estate interests through the office of the Deputy Mayor for Planning and Economic Development. Under Mayors Anthony Williams and Adrian Fenty, development was increasingly pursued to grow the city’s population and tax base, and the “value of real estate so much outweighed the value of people and neighborhoods,” according to Jordan.

All the while, he says, many large-scale developments only ever got off the ground because the city offered subsidies in the form of tax abatements and artificially low asking prices for public land, allowing developers to duck acquisition costs, downplay risk, and green light as many projects as possible. Consider the “laughable” $1 that Paramount Development Corporation, run by Ben Soto, former campaign treasurer for Fenty and Muriel Bowser, paid to acquire the land where it developed the Wharf. The formerly public land was valued at $95 million.

“For organizing’s sake we tend to make the developer the devil,” Jordan says, “because that’s who we see. That’s who we can get a hold of. But they don’t really care. They’re willing to follow the rules so long as it’s profitable.”

In other words, he says, it’s the city leading the gentrification dance.

Activists like Theresa and Jordan believe this public-private pattern of growth and development explains D.C.’s rise to number one in gentrification intensity, an unenvious distinction that was abruptly interrupted by the PUD appeals, which added significant risk to development projects, and helped slow displacement’s tide. 

However, the D.C.-based smart growth experts City Paper interviewed fundamentally disagree with this interpretation of D.C.’s gentrification rise and fall, and where the appeals fit in.

“Some kind of link between drop in PUDs and change in gentrification rate is highly dubious,” writes Cheryl Cort, policy director for the Coalition for Smarter Growth, in an email. “The years don’t line up with NCRC’s time frame.”

The second NCRC study measured the period between 2013 to 2017, she says, but the crash in PUD applications came in 2018. The results would have affected housing produced after the study concluded because development projects typically take two or three years to materialize. Additionally, Cort says, a quick examination of the building permits issued during the second time period NCRC measured, when gentrification fell, shows a “substantial rise in building permits,” much higher than the previous period when gentrification rose, which runs counter to the gentrification by way of PUDs claim. 

“But that is all beside the point,” she says.   

Cort and other smart growth advocates see it a totally different way. They believe that D.C. gentrified not as a result of the construction or mere presence of luxury apartments, PUDs, or the folks who live inside them, but as a result of complex historical forces that spurred massive migrations of well educated millennials seeking opportunity in insulated, “recession-proof” cities like D.C. in the aftermath of the 2008 economic crisis.

“The D.C. economy recovered much faster than the rest of the country from the 2008 crash,” she writes, “so you had a surge in young educated people moving to D.C., NYC and SF in the 2009-2012/2013 period.”

When the country began to recover, she says, so did secondary markets in smaller cities like Denver, Austin and Raleigh, “and the rush to D.C. faded.”

“It’s not about PUDs at all,” she said. “That is correlation but not causation.”

Or as one smart growth advocate who chose not to be identified put it, “2014 is when D.C. started putting $100 million a year into the Housing Production Trust Fund. It’s possible that someone could just as easily look at and say that it helped stave off gentrification.”

These individuals believe gentrification is best explained by the loss of old affordable housing and lack of new affordable housing, with the goal being to build more, plain and simple. To that end, they argue that the slew of appeals made in recent years only exacerbated gentrification, as they blocked the construction of any new affordable housing. 

“Blocking new housing from being built will lead to more displacement,” Cort says. “If people want to live in the city, they will compete for whatever housing is available. If there’s a shortfall between housing and households seeking it, lower income residents will be out-completed by residents with higher incomes.”

“The question is how do we build enough housing to keep up with demand, while using the rising tax base to protect and improve the lives of our vulnerable and disadvantaged residents?” she asks.

Asked to respond, Theresa expressed doubt. 

“I think Smart Growthers do not make a distinction between gentrified and non-gentrified neighborhoods,” he writes in an email, specifying that many of the appeals stalled developments in poorer neighborhoods. “That is the kind of development that displaces people and would not be captured by raw building permit data.”

*   *   *

With no end to the COVID-19 pandemic in sight, smart growth advocates and affordable housing activists agree that the dilemma of gentrification remains. So does their dissension. 

“YIMBYs say more housing, more housing, more housing,” says Coy McKinney, a teacher living in Southwest who helps run a neighborhood group called SW DC Action that advocates for a “more equitable, anti-racist, and environmentally sustainable neighborhood,” according to its website. 

McKinney and others filed an appeal against a proposed development at 4th and M streets SE, near The Wharf. 

The appeal concerns two residential apartment buildings planned to be built atop an open air gathering space where farmers markets, night markets, the DC State Fair and other gatherings are currently held. A web page detailing the appeal’s objection states, “the project should contain more affordable units, consider and adopt current usage of market space, and model the SW Plan’s goal of being ‘an exemplary model of equity and inclusion.’”

YIMBYs and smart growthers “pretend to have this racial analysis,” McKinney says, “but it doesn’t work.” 

McKinney, who is Black, pointed to the Coalition for Smart Growth’s “Courageous Conversations” series on the history of “housing, land use, and the history of redlining and segregation in Montgomery County,” as an example, or Greater Greater Washington’s promotion of The Color of Law for its book club’s book of the month in November. 

As another case in point, he referenced the recent public hearing over a rewrite of the city’s Comprehensive Plan, a long term policy document that guides city growth and development. 

In 2018, the District government began to iron out wrinkles between its zoning policy and Comprehensive Plan in an effort to curtail challenges to developments. This December, the D.C. Council voted to move forward with a rewrite of the Comprehensive Plan and a remapping of the city’s Future Land Use Map to allow for greater density and development throughout the city. 

Smart growth advocates supported and helped push for the changes, believing it will help lower housing costs and create more opportunities to build market rate and affordable units. Critics, on the other hand, said it would severely limit the ability of residents to appeal developments and that it weakens the language around the inclusion of affordable units in developments. 

“If I had to guesstimate, 80-90% of the people who wanted it to pass were White and made sure to talk about ‘racial equity’ in some form [during the public hearing],” McKinney writes. “On the flip-side, easily 90% of the people who were Black that testified were opposed to the Plan passing.”

Both sides seemed to be talking past each other, regardless of race.

As one supporter testified, “The Comp Plan on its own cannot make housing more affordable or stop displacement, but what it says is a necessary precondition to the necessary legal and fiscal actions that may attempt to do so. Given the District’s high housing prices and low housing supply, and what will surely be a protracted recovery from Covid-19, passing amendments to the 2006 Plan as soon as possible is the most productive action that we can take right now.” 

“I love this thing,” she says. 

Meanwhile, a dissenter questioned the Office of Planning’s informational campaign. “[The Office of Planning’s] ward-level meetings and surveys…were scripted, top down affairs heavy on smart growth talking points and devoid of community specific details … OP has replaced the few mandates in the current plan with aspirations … Increasing density is portrayed as the only mechanism to attain affordability, yet we don’t see affordability resulting from all the new, denser construction on the ground, despite the fact that some of it is uninhabited …”

“Residents are meant to take solace in the fact that their homes and neighborhoods are being rendered into something else for someone else in the name of equity, although there is no equity guaranteed,” she continued. “The dynamic reminds me more of the 1960s fight against white men’s highways through Black men’s homes.”

Like most smart growth critics, McKinney expresses disbelief in one of its key claims: that building more will increase supply, decrease demand, and lead to lower costs of housing. 

“These are all theoretical concepts,” he says. “The nickname for this is trickle down housing. It’s the same as trickle down economics. You give the rich a bunch of money and it’s supposed to trickle down.” 

McKinney isn’t swayed by academic research that favors this approach.

“First of all, it doesn’t work,” he says. “And secondly, it’s the opposite of justice, and justice, in my interpretation, is that those who need housing or have been disadvantaged the most should get first priority. Now you’re telling them to wait longer on the theory that eventually, hopefully, at some point in the future, the cost of housing will go down, where the approach should be, hey, this is affordable housing. It’s affordable now, and it will be affordable forever.”

He is not alone in his skepticism. 

“Growing numbers of affordable housing advocates and community members are questioning the premise that increasing the supply of market rate housing will result in housing that is more affordable,” states a 2018 paper from the NYU Furman Center titled “Supply Skepticism: Housing Supply and Affordability.”

The authors of the paper note that economists and city governments have tended to “ignore” these activists, who often “find themselves on the same side as those who oppose development for reasons having nothing to do with affordability,” like historic preservation or streetscape concerns, forming a “powerful block against development.”

“Many [affordability] advocates oppose development of new affordable housing as well,” they add, “unless it serves the households at the very lowest end of the income distribution currently in place in the neighborhood,” and despite a “preponderance of evidence [that] suggests that easing barriers to new construction will moderate price increases and therefore make housing more affordable to low and moderate income families.”

The problem with permanent affordable housing agreements is that “neighborhoods change,” writes Hank Brothers, a housing and community development lawyer, in an email. 

“It is not at all unusual for dramatic change over the course of less than a decade, in which case we must question whether what is appropriate today will be appropriate, or desired, fifty, eighty, a hundred years from now.”

“Moreover,” Brothers, who has been involved in a number of key appeal cases, writes “an owner, seeing a perpetual covenant, reasonably sees limited or zero future upside … and accordingly will not be incentivized—or able—to invest in upkeep, or capital improvement. Thus a permanent covenant creates a structural problem.”

For Theresa, it all boils down to growth.

“When a city endeavors to attract people, it enters a worldwide marketplace and housing demand for those it seeks to attract is unlimited compared to what any city can supply,” he writes in an email. “Whereas if you develop for local populations, which has a fixed number, you can relieve their needs for affordability and family units. The rub is native populations have vastly different needs from the global elite.”

With the pandemic shutdown, “demand is as low as it’s ever been,” he says, “but costs have not broken through any floor and suddenly become affordable for people.”

Cort emphasizes that D.C. has realized important benefits from its growth—“a robust tax base that provided for investment in schools, health care, libraries and other critical public services” —while bringing new challenges, “most significantly … the pressure on the existing housing stock to keep up with rising demand as new people (with higher incomes) move in and stay.”

“D.C.’s response has been some of the largest commitments to locally funded affordable housing,” she says. “But it’s not enough, and the city can and should do much more … We need to … make it easier to build new homes to keep up with rising demand, protect vulnerable residents from losing their homes, and dedicate more of our resources to pay for deeply subsidized housing, better education, training, and services to lift up our families who have been disadvantaged by the system.”

For his part, Jordan remains unconvinced. 

“The challenge is that I don’t necessarily disagree with some so-called smart growth principles or see all developers as the enemy,” he writes. 

“The issue is the use of state resources and state policy and its impact on housing and related markets,” Jordan wrote. In other words, he believes that smart growth advocates are blind to the role that the city government plays, and to the reality that, as he sees it, the term smart growth has now become a “euphemism for gentrification,” or “Negro Removal.”

So too, he says, are many low, moderate and middle income Black neighborhoods who are “desperate for amenities” and “will initially align with developers and smart growth, but soon learn they are selling fantasy.”

As far as the effect of coronavirus goes, “I think it’s just a blip,” he says, “because it’s not about what you can afford right now, it’s about investments that are planned for three years from now.” 

It all depends on how long the virus lasts, he says. “As long as D.C. is seen as a better market for capital, it doesn’t matter in the long run.”