Bait and Switch | Neighborhood News | Chicago Reader

Bait and Switch 

West Town residents voting for an attractive housing proposal get less than they bargained for

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By Ben Joravsky

It's not much to look at now--just a near-west-side working-class neighborhood wedged against the Dan Ryan--but in a year or two or three, it'll be the next Lincoln Park. Or so say housing activists waging the latest and loudest version of class war in Chicago.

At stake are plans by the Erie Neighborhood House to scatter 30 affordable units of housing in various lots just east of Ashland and south of Chicago Avenue. Erie House backers say the housing is needed to protect poor and working-class residents from being forced out by rising rental costs. Their opponents, many of whom are working class themselves, say the area's already too congested with low-income rental housing. The larger issue for city planners is how to balance the needs of home owners and renters in a neighborhood where property values are starting to rise.

For years the eastern edge of West Town has been a port of entry for immigrants--first Italian, then Polish, now Latino. In the last few years housing costs have started to increase as a small but steady stream of artists, professionals, and real estate speculators creep west from the Loop and east from Wicker Park.

As a result, many longtime working-class families are feeling pressured to move. "I've lived in this neighborhood for [about 25] years--since I came to Chicago from Puerto Rico," says Maria Valderrama, a member of Erie House's housing committee. "I raised my kids here. They went to school here. I go to church here. This is home. I don't want to leave."

A few years ago Valderrama, who works in a medical clinic on the near north side, and her family were forced out of their three-bedroom apartment. "We lived there for many years and loved it," she says. "It was owned by a nice, sweet old Polish lady. But when she died her children sold the building. And the new landlord said rent would go from $280 to $450. He said once he was finished remodeling, rent would be $700. We had to move. How can I afford $700?"

In 1994 Erie House devised its "low-income equity" housing program for residents like Valderrama. Based on ventures in New York City and Atlanta, the program would offer residents a share in a cooperative housing complex for a down payment of about $2,000. Monthly payments would be capped at about $400 or $500 a month, depending on the size of the unit, and complexes would be managed by residents. The tenants' share in the co-op would increase with each monthly payment. "We want to balance affordability with home ownership," says Erik Nordgren, an Erie House organizer. "We want to protect people with a program that takes real estate off the speculative market."

In February 1995 the matter was brought before the community in a referendum, proposed by Jesse Granato, then one of several candidates running for alderman of the First Ward. "I told Erie House that I would support their plan if the community also supported it," says Granato. "I said let the people speak."

Erie House sent volunteers and staffers door-to-door to win support for their program. "I remember Erik Nordgren knocked on my door and sat in my kitchen and spent two hours telling me about this wonderful program," says Brian Boyer, a documentary producer who's lived in the neighborhood for the last six years. "He was the Johnny Appleseed of equity housing, spreading the good word where he went. It sounded great--who can argue with home ownership? I voted for it."

The referendum won 56 percent of the vote, and Granato pledged to do what he could to get the city funding and approval the program needed. But unbeknownst to Granato, Boyer, or virtually anyone else in the community, Erie House had adjusted the program after city housing officials told the group that more development money would be available through federal tax credits than direct subsidies. Because of the rules governing tax credits Erie House could no longer offer residents a limited share in the co-op. Instead of buying $2,000 worth of equity with a down payment, residents would pay a security deposit of $220 plus one month's rent and would not be eligible to buy into the co-op for 15 years.

"Fundamentally, we're not changing the program," says Nordgren. "All we're doing is putting off the limited-equity share for 15 years. The residents would still have control over the management. They would still have stability in the neighborhood."

Erie House officials decided to revise the program at least a month before the referendum, yet they didn't publicize the changes for fear of complicating matters and confusing voters. "I don't think it would have changed people's minds," says Nordgren. "It's still basically the same program."

But many residents felt deceived when they heard that the program had been changed. "I heard them describing the program at a meeting in March, and I said, 'Wait a minute, this isn't what I voted for,'" says Boyer. "So I called Erik, and he said something like, well, after 15 years people will be able to buy into their building. I said, 'But what happened to the co-op? What happened to the down payment? What happened to the concept of people owning their own homes?'"

As Boyer and others see it, all the talk of future equity aside, Erie House was proposing to build more subsidized low-income rental units. The ward already has several hundred--as much as any other on the north side of the city. "There's a big difference between owner-occupied equity co-ops and low-income rental housing," says Jose Diaz, who along with Boyer is a member of the Eckhart Park Community Council, a newly formed local group. "Let's face it--if you put $2,000 down and you own your building, you're going to take care of it better. You can say, 'Mi casa, this is my house.' You'll respect that house. If you have a nephew who's a lemon head, you'll say, 'Don't hang around my building.'"

Diaz and Boyer say much of the crime in the area results from gang members who live in subsidized housing. "We're at the epicenter of a gang war for control of crack cocaine," says Boyer. "We've had murders on almost every major block. Everyone knows you shouldn't crowd too much low-rental housing in one neighborhood."

When Granato discovered the program had been changed, he too pulled his support. "It's like telling me you're going to sell me a Chevy, then giving me a Toyota--this isn't what they said they were going to build so I can't support it," says Granato. "I don't say all low-income housing's bad. But you have to manage it right. I live next to a scattered-site project, and you have people on the street dealing drugs. I was recently having a barbecue at my house, and a boy got shot right out on the street. You have to manage the property you have before you ask for more."

Without Granato's support the program is effectively dead. And now Erie House feels betrayed. Valderrama and others have worked long and hard on the program, organizing dozens of meetings to keep the community (and Granato) informed. As they saw it, the differences between the proposals were minimal. Besides, many people in the community still want the housing: more than 300 residents turned out for a recent rally. "I was not alone in favor of the program," says Valderrama.

In the last few weeks, after a series of angry public exchanges that faintly echoed past gentrification battles in Logan Square and Uptown, the two sides have pulled farther apart. There were those who accused Erie House of attempting to keep poor people dumb and dependent, a fatuous accusation given Erie's many adult-education programs. And there were those who compared the Erie House opponents to land-grabbing yuppies--also a misguided accusation. Granato was born and raised in the neighborhood, as was Diaz, who drives a cab to pay off the mortgage on the eight-unit building he and his brother bought 16 years ago. "I live in the basement apartment, and he lives on the third floor," says Diaz. "We had to put $2,000 down to buy this place, and I only had $200 in the bank, so we borrowed from every friend and family member we could find."

Neither Diaz nor Boyer believes there will be a Lincoln Park-like turnaround, and both insist they would be content if the vacant lots were filled with single-family homes, made affordable to the working class with subsidies.

If there's hope for a compromise it comes from Congressman Luis Gutierrez, who, at Erie House's request, is acting as an intermediary with Granato. There's talk that with gentle prodding from Guitierrez, Erie House might again revise the program, reinstating the $2,000 down payment. One local banker says that's not too much for families making $20,000 or so.

"I've written loans for immigrant families, mostly Mexican, making $16,000 a year who have to put $6,000 down," says the banker. "I just had a family of 12 making $32,000--with the father and son working three jobs between them--borrow for a house. I'm not saying it's easy, but it happens."

Granato says he remains open to Erie House's original plan. "The solution's very simple," says Granato. "Show me the plan as it was originally represented, and I'm sure I can help out, and we can go back to being happy neighbors again."

Art accompanying story in printed newspaper (not available in this archive): photo of Jose Diaz by Randy Tunnel.

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