What privatizing DC public housing looks like so far
Since being the site of the country’s first all-Black public housing development at Langston Terrace Dwellings, DC has been one of many centers for innovative approaches to public housing, both through adoption and implementation of newer federal programs, and through initiatives led by the DC Housing Authority (DCHA).
In previous articles, I wrote about how the public housing system in the United States began and how it has evolved and devolved. And, despite being undermined at every level of oversight, broad acceptance that public housing had been a failed endeavor led not only to experiments in privatizing the system from the federal level, but also to experiments in privatization on a local level.
Here is how privatization of public housing has played out in the District.
DC’s HOPE VI difficulties
Just as the federal government mismanaged the nationwide public housing system, so did the District’s housing authority mismanage DC’s public housing portfolio. By 1978, public housing demand in DC had produced a waiting list of roughly 7,500. At a mayoral debate, then-activist-turned-politician and future Mayor-for-Life Marion Barry stated, “I am committed to increasing the availability of decent, safe and affordable housing.” The next year, Mayor Barry set a plan in motion to use a mix of public and private financing to rehabilitate 733 of the city’s vacant and blighted housing units, including some public housing.
Ten years later, most planned housing unit renovations remained delayed, and while the waiting list had decreased to 7,165, public housing maintenance funds reportedly went unspent.
In 1992, the Department of Housing and Urban Development (HUD) graded DC’s public housing at a 22.38 on a 100-point scale, deeming almost 20% of the portfolio was uninhabitable.
Over the 16 years before a judge put DCHA-preceder Department of Public and Assisted Housing (DPAH) into receivership in 1994, the agency had had 13 different directors. However, the lawsuit that led to receivership was still ongoing as HUD’s HOPE VI program was being rolled out nationwide, and DC was one of the early grantees.
Through HOPE VI (Housing Opportunities for People Everywhere), HUD competitively awarded grants to public housing authorities (PHAs) to raze and redevelop distressed communities. The grants were intended to be combined with private sector funding in order to finance construction of mixed-income communities.
DC’s first two HOPE VI projects, which replaced the Ellen Wilson Homes in Capitol Hill and the Valley Green and Skytower communities in Washington Highlands, have been heralded as successes (likely because there were so few families to displace from the original housing — the communities were nearly vacant prior to redevelopment). Overall, however, DCHA’s HOPE VI track record is not unblemished for the seven communities slated for participation.
A 2003 audit of DC’s management of HOPE VI properties found improper financial practices and record-keeping. By 2006, DCHA had demolished 2,961 public housing units as part of HOPE VI and had plans in place to replace one-third of those units (1,031 units) as new public housing, one-third (999 units) as mixed-income rental units, and one-third (1,088 units) as for-sale housing. The reality, though, has often been defined by delays and displacement.
The 23-acre Arthur Capper/Carrollsburg redevelopment less than a mile from Greenleaf Gardens is a prime example of how redevelopment can lead to displacement and lags in unit replacement, as 14 years after groundbreaking, some parts of the former community still serve as surface parking for visitors to Nationals Park. Meanwhile, HOPE VI was dismantled in 2011.
DC’s new public housing authority came with more freedom
In 1999, receivership was wrapping up and the city established the DC Housing Authority. The agency’s mission, as described in the District of Columbia Housing Authority Act of 1999, was to provide “decent, safe, and sanitary dwellings, and related facilities, for persons and families of low-to moderate-income in the District.” By then, HUD had created the “Moving to Work” (MTW) demonstration program, which grants some PHAs more latitude in how they spend their funds, enabling them to test out creative programs.
DC became an MTW authority in 2003 and is now one of 39 MTW PHAs. Since then, DCHA has participated in several privatization experiments of its own, including the New Communities Initiative (NCI). NCI was launched in 2005, allowing DCHA to take the HOPE VI approach to obsolete buildings in its portfolio while ceding responsibility for the redevelopment process to the Office of the Deputy Mayor of Planning and Economic Development (DMPED).
Unlike HOPE VI, NCI was meant to guarantee one-for-one replacement of demolished units, and while DCHA would complete the process to dispose of the property through HUD, DMPED would solicit, select, and negotiate the terms of the new development, and see it through to completion.
For example, two miles from Greenleaf Gardens, the historic Barry Farms is in the 14th year since NCI redevelopment was approved. Although residents were eventually able to assert their rights and advocate to secure (and claim a partial victory for) historic landmark designation of their community, most of the homes there have been razed and nearly all the residents have been displaced. The development team overseeing the project has not yet offered an updated proposal for the site following this January’s historic preservation ruling.
Across town in Northwest, the Park Morton redevelopment has also been beset by delays, primarily due to four homeowners near Park Morton appealing a zoning approval for the first phase of development three years ago. These neighbors’ complaints have primarily centered on the loss of most of the temporary Bruce Monroe Park where the bulk of the replacement units for Park Morton residents will be constructed, along with the size and scale of the development on that site.
The DC Court of Appeals sent the project back to the Zoning Commission to reconsider the approval earlier this summer; meanwhile, the development team is aiming to instead start the redevelopment on the existing Park Morton site, effectively taking the “build-first” option off the table. DCHA has already filed for raze permits.
MTW designation offers new ways to subsidize housing
Rather than having all the agency’s eggs in the redevelopment basket, however, DCHA has also used its MTW designation to get creative with how it subsidizes housing. DCHA has used MTW to sweeten the pot for private landlords to accept vouchers citywide, furthering the goal of deconcentrating poverty and winning the city accolades for its voucher distribution (although some have questioned whether this arrangement works out for voucher recipients and their new neighbors).
In 2007, DC established the Local Rent Supplement Program (LRSP), offering a locally-funded voucher option for households earning up to 30% of area median income (AMI). DCHA currently administers over 4,600 LRSP vouchers in addition to nearly 11,000 federally-funded vouchers. LRSP funds are also used to subsidize development of affordable housing through the DC Department of Housing and Community Development (DHCD)-administered Housing Production Trust Fund, combined with other financing DCHA and its partners can provide like Low-Income Housing Tax Credits and New Market Tax Credits.
Leftover LRSP funding has also been used to finance public housing repairs, and combined with the DCHA Rehabilitation and Maintenance (R&M) fund the city created in 2017, DCHA has had a more reliable means to get funding for maintenance (although R&M funds are not dedicated and are subject to the budget approval process). And while the R&M fund is a welcome addition to DCHA’s ability to manage its portfolio, it may be too little too late considering the rampant disrepair in its communities.
“Much of the existing conditions are the result of more than a decade of federal underfunding of the Capital Fund Program and Public Housing Operating budgets — monies provided to housing authorities to meet maintenance and capital needs of public housing communities,” DCHA explained in its 2021 MTW plan. “DCHA acknowledges that the flexibility provided by its MTW designation has lessened the impact of reductions in federal funding on the provision of core services; however, funding remains a significant challenge.”
And amidst these slow-going initiatives, the need for public housing in DC has still grown: there were over 11,000 people on the waiting list in 1992, and now the list has been closed to new applicants since 2013 when there were over 70,000 candidates. As of July 2020, there were over 73,000 households on multiple DCHA waiting lists, including 27,370 for traditional public housing units.
DCHA’s future repositioning plans
DCHA has answered HUD’s 2018 call to accelerate repositioning, or removing units from the public housing portfolio. Last summer, DCHA released “Our Portfolio, Our Plan” to lay out a preferred roadmap to stabilize the agency’s 41-property portfolio. The Plan notes that HUD capital funding, which goes to maintenance and rehabilitation, has decreased by 2% annually since 2000 (not adjusting for inflation), and that this has left DCHA with a funding gap of $2.2-2.5 billion to maintain the existing housing. To compensate for this shortfall, repositioning is seen as a way to address varying needs throughout the portfolio in a way that is more time- and money-efficient, allowing DCHA to leverage $785-850 million in cash to finance stabilization over 17 years.
DCHA’s Plan places priority on 14 sites for either intensive repair via the Rental Assistance Demonstration (RAD) process, or complete redevelopment via HUD’s Section 18 process. Greenleaf Gardens would be first in line for the latter. Since 2006, Section 18 has enabled PHAs to apply to HUD to demolish public housing deemed “obsolete”, or irreparable at a “reasonable” cost.
In order to secure a Section 18 demolition-and-disposition, the subject property should meet the criteria under HUD’s Obsolescence Test, HUD must remove the federal Declaration of Trust requiring the site be used as public housing, and residents must be offered vouchers to relocate during the redevelopment process. Although this is not required federally, DCHA has also committed to pursuing a ground lease with a selected developer in order to maintain control of the land, and has expressed a preference for developments that include build-first opportunities, wherein new housing is constructed before currently-occupied units are demolished and their residents displaced.
In order to meet the Obsolescence criteria, DCHA will need to complete another audit of Greenleaf and other identified properties, a process initiated this spring in part as the agency released an RFP this past March to find a third party to complete a Physical Needs Assessment (PNA) for the portfolio.
DCHA’s Board of Commissioners approved a resolution in July to award the PNA contract, and preliminary results for the prioritized 14 properties are expected by the end of the year. However, the current PNA process also highlights the inadequacy of the data that informed DCHA’s Transformation Plan, as DCHA representatives admitted to the Board that the 2016 assessments used in the Plan underrepresented the depth and scope of disrepair in the portfolio.
DCHA Chief of Planning, Design, and Construction Alex Morris explained during the July meeting: “I don’t want to offer too many aspersions against the 2016 document, but one of the things that, when we were speaking with the [Chief Financial Officer] CFO and speaking with the mayor’s budget office, their concerns about the 2016 document were, well, ‘Based upon the work that you did at the sites, do you think that the document was accurate, and how do we trust that the data in there is complete and thorough?’
“In doing work at Judiciary [House] and Ledroit [Apartments], based on the level of survey that was done and the document itself, we found our costs to be higher than what was depicted in the Capital Needs Assessment,” Morris continued. “So we’re going to be much more careful this time to not only project what’s visible, but also project the related infrastructure work and any other hidden conditions so that we get an accurate picture of what’s really needed.”
For this round, DCHA plans to involve more employees in reviewing the data from the upcoming PNA, and the results will also be inputted into the Office of the CFO’s Capital Asset Replacement Scheduling System (CARSS). Although DCHA does not anticipate additional properties being labelled as “Urgent”, the results of the PNA could necessitate amendments to the Transformation Plan, almost certainly including an increase in estimated costs and, perhaps, a reordering of priorities.
Despite delivering some of the country’s first public housing units, DC has had a disappointing record when it comes to managing its public housing stock, and more-ambitious attempts to revitalize the portfolio have often looked more like failed experiments causing further disruption for those meant to benefit.