Privatizing the Ghetto | Year In Review | Chicago Reader

Privatizing the Ghetto 

What happens when the CHA gets out of property management?

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Illinois lawmakers and the media have spent a lot of time this year considering how taxpayers can help wealthy spectators watch even wealthier football players botch games at Soldier Field eight Sundays a year. Meanwhile the Chicago Housing Authority is proceeding with a much less scrutinized "transformation plan," under which it will spend more than $1 billion to turn 38,000 public-housing apartments into 25,000. To do this, the agency will move residents into rent-subsidized apartments in the private market and then back into renovated CHA properties in mixed-income neighborhoods.

At the same time the CHA is fundamentally reinventing itself--by hiring contractors to do almost everything it used to do. "In the past," states the transformation plan, "the CHA was primarily an owner and manager of public housing. In the future, the CHA will be a facilitator of housing opportunities. It will oversee a range of housing investments and subsidy vehicles. Where appropriate, it will own housing, but it will just as likely provide financial assistance to other private and nonprofit development organizations to expand housing opportunities." (The plan is on-line at Already the CHA no longer manages any of its buildings--they've all been under private or resident management since midyear. As board member Andrew Mooney put it at a November 16 meeting, "We're getting CHA out of the business of providing direct services and putting them in the hands of those who have expertise." Still, the same agency that couldn't manage its properties well must now ensure that its hired guns do so.

CHA residents have heard promises of better living conditions and better management before (one reason many of them question plans that involve demolition). In the last 25 years the agency has racked up a record of futility and incompetence that makes this year's hapless Bears look like all-stars. The current plan--championed by chief executive officer Terry Peterson, with Mayor Daley right behind him--is the latest in a long line. Earlier chiefs Vincent Lane and Joseph Shuldiner each promised, in banana-republic style, to clean up the mess his predecessor left.

Maybe this time will be different. Maybe CHA residents will be able to find enough decent places to rent using housing vouchers, though in 1999 the private housing market had only a minuscule 4.2 percent vacancy rate. Maybe some people will be able to return to well-managed mixed-income communities, as the CHA has promised.

But we may have trouble learning whether they do. Demolishing the public housing high-rises is so popular among nonresidents that they assume the notorious problems in the high-rises can be made to vanish as easily as the bricks and mortar. Other than federal Housing and Urban Development bureaucrats and CHA residents, few people are paying attention to how well the latest promises are being--or can be--kept. In the first of a series of "fact sheets," issued in October, the Metropolitan Planning Council's housing director, Robin Snyderman, and housing associate, Steven Dailey II, list several concerns with the transformation plan. Theirs is a friendly critique--MPC supports the plan--and is therefore all the more revealing. In digest form, here are they four things they worry about (the full list is at

1. There may not be enough money. According to affordable-housing developers, a decent new unit in Chicago costs roughly $130,000. But, the fact sheet notes, "CHA has allocated $90,000 per unit with the balance to be made up by the City of Chicago. Given the Department of Housing's limited resources, it will be extremely difficult to meet goals without reducing other affordable housing initiatives in the city." The Chicago Rehab Network has also criticized the CHA's plan as overoptimistic and underbudgeted.

2. If there does prove to be enough money, there may not be enough information available for public-housing residents to make good decisions. Since the transformation plan was first announced in 1999, many families have left public housing on the basis of rumors or been relocated without adequate notice. "Although time lines related to building demolition and redevelopment are available, they currently lack reference to tenant consultation....Every family [should be] briefed concerning lease compliance requirements and their right to return as detailed in the relocation contract. CHA should give this its highest priority, and even cease relocation activities if an adequate tenant briefing program is not in place soon."

3. If there is enough money and enough information, there may not be enough services. "Sixteen service connectors"--social workers who put needy families in touch with appropriate help--"have been hired to work with 14,000 families....The scale of the 'Service Connector' model appears insufficient to meet the demands of public housing residents."

4. If there is enough money, and enough information, and enough help, former public-housing residents may still end up in neighborhoods just as isolated as those they've left. According to a 1998 study of 1,000 families moving from public housing to the private market, "Close to 80% of those families found housing in census tracts that were over 90% African American, and over 90% in census tracts where the median income was under $15,000 a year."

If the transformation plan works, the CHA will preside over a collection of integrated mixed-income communities in which poor people have a reasonable chance to better themselves and their children. If not, the agency will have demolished the high-rises--the "second ghetto" of Arnold Hirsch's classic history--only to replace them with an equally discriminatory but less visible third ghetto.

Art accompanying story in printed newspaper (not available in this archive): illustration/Carl Kock.


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