Landlordpolitics.com

 

Neighborhood X

 

I admit I have a chip on my shoulder about neighborhood groups in Minneapolis because, twelve years ago, one of them, which I will call “Neighborhood X”, tried to run me out of business.

I am an apartment owner in this neighborhood. One month, when I happened to go out of town during the meeting of the local Rental Property Owners’ meeting, some property owners and staff members of the neighborhood association set in motion a series of events by which two different inspectors condemned my apartment building. This was followed by a general neighborhood meeting called for the purpose of denouncing me personally and demanding that I relinquish control of my property and that the building be left vacant for a minimum of six months (so that the City Council could determine its fate).

I survived this traumatic event, which at the time I likened to a “Red Guard” show trial staged during China’s “Cultural Revolution”. Having subsequently married a woman who experienced the real Cultural Revolution, I now realize that this was hyperbole even if it seemed frightening at the time. In any event, I did survive this attack on my financial resources and put the building back into service. Having “paid my dues” so to speak, I have had no further problems as a landlord with “Neighborhood X”.

Years later, in fact, I was elected an area representative of this neighborhood association and subsequently served on the board. I recognize that my fellow board members and the organizational staff are persons of good will who believe in their mission. The staff carries out its prescribed function competently. Nevertheless, I object fundamentally to that mission and said so at the last meeting. I proposed a debate with the group’s leaders which may have seemed a bit provocative. So this written article will suffice to express what I had to say.

The first problem that I have with Neighborhood X (which may well resemble other neighborhood associations) is that that it does not, in my opinion, deliver enough services to neighborhood residents in relation to cost. There are 4,150 persons living in this neighborhood. The association’s projected annual budget for 2007 is $218,000, of which $160,000 is payroll expense. The Neighborhood Revitalization Program (NRP) provides $120,000 of its funds, and the McKnight Foundation, $70,000. The fact that this neighborhood is the second poorest in Minneapolis and that whites are less than 25% of the residents seems to justify putting extra resources into this enterprise.

What services are delivered to the residents? First and foremost, there is an annual meeting which features elections to the board and a few cultural presentations, plus free food. Neighborhood X also hosts ad hoc meetings of residents to consider various development projects. There is an “Undoing Racism” project. On the other hand, the summer picnic which the neighborhood group used to organize is now handled by a local church although a small subsidy is provided.

There are no athletic leagues, no book-discussion groups, no public dances, no lectures, no contests, no identification and recognition of the interesting or talented persons in our midst. When I suggested that Neighborhood X staff ought to organize activities such as these for neighborhood residents, another board member remarked contemptuously that I was asking them to become “entertainment directors”.

The fact is that the neighborhood association is housed in a large and expensive building constructed about ten years ago using NRP funds; and there is also a brand new school building now slated for closing. Ought not such facilities be available to neighborhood or city residents? When I recently inquired about using one of the meeting rooms for a public discussion, I was told it would cost $50 an hour. No one around here has that much money so the rooms are largely unused. The park staff meanwhile continue to draw pay.

It’s not that there are no activities in this building but that they seem to be connected with structured programs that have eligibility requirements. Neighborhood residents have little idea what is going on there.

The other function that I would have a neighborhood association assume would be to promote development along the avenue which is its main commercial artery. When I once rode with a friend down this street, he commented how deserted the place seemed. Except for a popular restaurant, there were no entertainment spots, no hardware stores or supermarkets, book stores, or interesting places to visit. A neighborhood association, in my view, ought to be boosters of local business activity. It ought to promote useful infrastructure improvements such as transit innovations, burying the telephone lines to take advantage of the superb view of the downtown skyline, or, as I proposed, live theater to create night life along the avenue.

Sadly, that is not its style. The style of a neighborhood association such as this is to be gatekeepers of permissible development rather than boosters to bring new business to the area. Sure, the board members want to see Starbucks-type coffee houses up and down the boulevard. What they do not want is industrial development. They want long-established businesses that clean uniforms, deliver roofing supplies or service automobiles to go away. In the coming green economy, such places should not exist - at least, not in my neighborhood.

So what does Neighborhood X actually do? It generates plenty of paper to prepare for and report on meetings of the board and the various committees. As a board member, I receive each month a packet of materials containing 30, 40, or 50 or more pages, which are mostly photocopies of letters, minutes of meetings, reports, and other items that need to be considered and discussed. The board meeting itself takes two hours. Roberts Rules of Order is scrupulously observed. The staff is well organized, knowledgeable, and attentive. What is the focus of business?

At a recent meeting, for example, board members were asked to consider the “CBA Negotiating Structure”. CBA means “Community Benefits Agreement.” In the next twenty-five years, there is expected to be more than $1 billion in public and private investment in a redeveloped industrial area in and adjoining this neighborhood. A certain construction firm will receive exclusive development rights. The city of Minneapolis must approve its selection and, for that, the firm needs neighborhood support. The Community Benefits Agreement is the neighborhood’s way of bargaining for that support. It is a legal document that will ensure that the redevelopment project will “benefit” the neighborhood and its current residents.

Cutting through the legalese, I find that the CBA consists of several main provisions. First is its emphasis upon providing more affordable housing. A draft document states that the “Affordable Housing Goals (must) exceed requirements of Federal law, State law and Minneapolis city ordinance ... The Neighborhood requires that at least 50% of all new housing be affordable to low and moderate income households ... The Neighborhood would like to see up to 40% and no less than 35% of new housing units be designated as ‘rental’ units, and, at a minimum, 60% of the housing units be designated as ‘owner-occupied’ units

“Of the affordable housing units, the Neighborhood requires: (a) that 10% of all rental units built will be affordable (to) very low-income households (30% MMI), (b) 20% of all rental units built will be affordable to low-income households (50% MMI), (c) 20% of all rental units built will be affordable to moderate-income households (80% MMI), and the remaining 50% will be available at market rate .. All units will remain affordable for a minimum of 99 years.”

Now, I’m not completely stupid. I’m a landlord who provides housing to low-income and other tenants without subsidy (unless the tenants have Section 8 vouchers). Between 2000 and 2006, property taxes on my apartment building have risen by 68% while the crime rate has also risen. How will a rental unit that is constructed become “affordable” to prospective tenants if they are not already? By public subsidies, of course.

The authors of this CBA evidently feel that the project for which their approval is needed will become immensely profitable to the developer. In other words, there will be plenty of “fat” in the contract; and they want some of it. As a practical matter, a rental unit that is made affordable through subsidy will be able to undercut the housing that I offer on both quality and price. And I, as a private-sector landlord, will be asked to pay for this. In other words, I will be paying taxes to subsidize my competitor.

“The Neighborhood requires.” What Neighborhood? Am I not part of it? I realize that neighborhood organizations are controlled by majority vote; but I don’t remember voting on this proposal. It came out of a committee that was linked to another organization on which Neighborhood X and another neighborhood had representatives.

I as a board member never voted for those representatives. They seemed to have perpetual appointments. Both were former staff members of Neighborhood X. One, I believe, is employed with a non-profit group that promotes affordable housing. Yet, their document is written to give the appearance that it represents neighborhood sentiment.

Rather than take up fundamental issues, this month’s board meeting was asked only to consider the CBA “negotiating structure”. In other words, we needed to decide who is the “decision maker”. Is it Neighborhood X alone or should it include other organizations? Those proposed organizations included a church, a school, and two groups representing Asian Americans. The second option was recommended.

Of greater interest was the next agenda item: membership in that broader group that developed the CBA. As I recall, there was a call for new blood on the committee. I think I voted for that proposal.

The agenda item after that was a real “hot button” issue. It is titled “Undoing Racism Letter Stating Concern to (the name of a construction firm involved in a development project.) As I later learned, a spokesperson for that firm was asked at a public meeting how many members of minorities were employed by the firm. That person, a woman, replied that there were no minority employees - however, one employee was married to a black man, she said.

The staff memo reports that “much of the audience was offended by the comment.” As a result, the Undoing Racism committee was asked to become involved. “The primary concern focused on (the construction company) as an institution that will be doing work in the community,” the memo said. The board of Neighborhood X was asked to approve the draft of a letter meant as a warning or reprimand.

Indeed, the issue of race inspires one of Neighborhood X’s main functions which is “cutting edge” in the eyes of certain elected officials. Its rationale is expressed in the following mission statement written by the board president : “Many of us now believe that poverty is the number one issue facing (Neighborhood X), but Racism is the number one issue keeping us from building the social capital necessary to lift our community out of poverty. In North Minneapolis, a well-organized community with an anti-racist analysis is the prerequisite for any poverty reduction efforts.”

Neighborhood X includes “ a constituency which is 38% African-American, nearly 30% Southeast Asian, and just over 20% of people of European descent,” the statement reads. Yet, the board president, the lead staff person, and most committee heads of this neighborhood organization (with the exception of the Undoing Racism committee) are white. The Undoing Racism committee, however, is given control over Neighborhood X’s annual meeting and its attendant opportunity to interact with the dignitaries who might attend.

The suggestion that Racism contributes to the area’s poverty brought to mind a meeting of Neighborhood X’s economic-development committee that I attended. The committee members were discussing a questionnaire to evaluate development projects submitted by individuals or groups. The “score”, which was a numerical summation of 1-to-5 points given the separate answers, seemed like Voodoo decisionmaking to me; and I said so. The committee head then explained that this procedure was devised because the committee had made a “mistake” in a previous decision. It had turned down a proposal by a Hmong funeral director but approved one submitted by a white man wearing a suit. The committee needed a more objective scheme of evaluation to keep this from happening again.

Back to the Community Benefits Agreement. The second key recommendation was that the chosen developer create a “Developer Interest Free Loan Program” not to exceed (there are six digits after the dollar sign but the first one is not written in) who are “mutually agreed upon by the Developer and the Neighborhood Review Committee.” This money is to stimulate construction of affordable housing and five “Prequalified Non-Profit Housing Development Corporations” - i.e., the usual suspects - are named in the CBA.

There is also a third key recommendation: jobs for existing neighborhood residents. The CBA states: “The Neighborhood supports redevelopment that creates opportunities for existing businesses in Harrison, with an emphasis on those that are minority and female owned ... The Developer will partner with Prequalified Non-profit Community Economic Development Organizations ... to meet Employment Goals for Construction Jobs.”

“The following requirements are set for all phases of construction. (a) 25% minority owned business participation in all Project Area construction/ contracts, (c) 10% women owned business participation in all Project Area contracts/construction, (b) 10% Requirement for the number of Pre-Apprentice (or its equivalent) hours of on-site training hours, (c) 15% Jobsite employment requirement of workers comprised of local residents with existing skills in the trade.” (Yes, there are two “c”s in the document.)

As a neighborhood business owner who also pays taxes, I would hope that the City of Minneapolis would negotiate a contract with the developer which is relatively free of fat. If all these social goals could be met while a reasonable profit was earned, that would be great. Otherwise, those speaking in the name of Neighborhood X are like the old “robber barons” who intercepted traffic that floated by on the Rhine and exacted a toll. As a taxpayer, the toll ultimately comes from me.

In summary, the concept of representative democracy means that we elect public officials who will spend time carefully and conscientiously studying questions of public policy and making decisions on our behalf so that we don’t have to spend time thinking about such things. If anyone should perform a “gatekeeper” function, it should be city government, not persons who show up at sparsely attended annual meetings of neighborhood associations and are elected to the board positions. Such organizations should directly serve the neighborhood residents. They should put service on the street.

 

           Articles written about housing          Back to: MAIN PAGE

COPYRIGHT 2007 THISTLEROSE PUBLICATIONS - ALL RIGHTS RESERVED
http://www.landlordpolitics.com/neighborhoodx.html