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Housing Thu Jan 13 2011
Capitalizing on Foreclosure: TIFs and Housing
Sweet Home Chicago, a coalition of housing advocates, continue their push to use tax increment financing (TIF) funds to purchase and rehab foreclosed properties and provide them as affordable housing. This seems like a reasonable idea; no need to reinvent the wheel, though, I'll just go ahead and quote Progress Illinois' Micah Maidenburg who said it so well:
Foreclosures radiate outward. Lawns don't get mowed, maintenance is deferred, and empty homes with boarded-up windows are prime targets for vandalism. Property values decline -- each home within 250 feet of a foreclosure loses 1 percent of its value due to the dispossess, according to one study, and the worth of the seized home itself sinks by 27 percent. When a few foreclosures cluster on a single block, entire neighborhoods swing into reverse. Gloria Warner, a member of the community group Action Now, described at a press conference yesterday how foreclosures are socking her community in West Englewood:
On its face, the proposal would ameliorate the social repercussions of the foreclosure crisis, while also achieving to some degree "scattered site" affordable housing, which is key to breaking the pattern of ghettoizing the city by social class and race. There is some evidence that residents have more incentive to take care of and protect their residences in scattered-site programs.
One question that comes to mind: would relying on TIF money to maintain a scattered-site housing program prevent needed reforms to the TIF program?
