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The vicious cycle of unaffordable housing in Washtenaw County

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The City of Ann Arbor maintains several units of low-income housing off Packard Road, tucked between Rose Park and Mary Beth Doyle Park. | Jim McBee

 

As rental costs in Ann Arbor rise, rents in Ypsilanti drop. 

This trend creates “pockets of poverty that are really hard for people to get out of and make better for themselves,” said Teresa Gillotti, housing and infrastructure manager at the Washtenaw County Office of Community and Economic Development. “So we’re creating more inequity by not addressing our housing problems.”

The report

In 2015, the OCED commissioned CZB, an urban-planning consulting firm, to create the Housing Affordability and Economic Equity report. (PDF) It gives an overview of Washtenaw County housing conditions and ways to improve affordability. 

The rule of thumb: Pay about 30 percent of your income before taxes on housing.

High rent is most detrimental to people in Washtenaw County with household incomes of $20,000, 94 percent of whom pay more than 30 percent of their income to keep roofs over their heads. Even people who earn between $35,000 and $49,999 face problems with unaffordable housing in Ann Arbor; 45 percent of them pay too much. High rents affect homelessness in Washtenaw County, which has one of the top 10 homeless populations in Michigan at 342 people.

Andy Labarre is chairman of the Washtenaw County Board of Commissioners. “We have, unfortunately, an economically segregated housing stock in this county that, even worse, also tends to segregate along racial lines,” he said. “And I think it’s a huge disadvantage for the city of Ann Arbor and for the city of Ypsilanti, Ypsilanti Township, and really the county as a whole.” 

This leads to more inequity, as the county becomes more and more segregated and the economic and racial diversity in Ypsilanti and Ann Arbor public schools decreases. 

Many working class families also spend a large part of their incomes on transportation, especially those who work in low-income jobs in Ann Arbor but can’t afford rent there. According to the report, “transportation is usually the second largest household expense for families, after housing costs.” 

Meanwhile, enrollment in Ypsilanti public schools continues to drop because of the school of choice policy, which allows students from Ypsilanti to go to Ann Arbor schools. That costs Ypsilanti schools funding, which furthers inequities in Washtenaw County.

Racial inequity exists across Michigan. According to a report prepared by Altarum Institute titled “The Business Case for Racial Equity in Michigan,” more than 70 percent of all jobs in Michigan will require some form of postsecondary education by 2020, but only  54 percent of African Americans and 44 percent of Latinos meet this requirement. 

In 2012 the Michigan graduation rate for African American children was 60 percent, and Latino students 64 percent, according to Governing.com. The report cited an Alliance for Excellent Education estimate that if the graduation rate for children of color had been 90 percent, annual earnings would be $151 million higher. That would have increased spending by $116 million, federal tax revenues by $24 million and state and local taxes by $11 million. 

What to do?

Gillotti said the county’s goal, in response to the CZB Report, is to add 140 affordable units each year for the next 20 years across the county. There are barriers to the goal. For one, the Ann Arbor Affordable Housing Fund “has not had steady funding for the past five to 10 years,” Gillotti said. 

There are hopes to increase money for affordable housing, such as the plan to sell the Library Lot in downtown Ann Arbor, which could put as much as $5 million in the city’s fund. The City Council also proposes Downtown Premium Zoning Amendments, which encourage builders to include affordable units in their residential buildings or pay a fee into the Affordable Housing Fund. 

Another solution that has attracted attention is the Ann Arbor City Council allowing the construction of accessory dwelling units, or additional housing in or near a family-housing unit. These “granny units” were previously allowed only for Ann Arbor residents to house family members. “Their planning department said that they got between 75 and 100 phone calls, but they haven’t gotten a single application,” Gillotti said. She sees these units as a partial solution, but not the solution, to reaching the goal of 140 affordable housing units each year. 

A housing project proposed for county-owned land on Platt Road in Ann Arbor represents another way to chip away at the goal. The county received six proposals, each with a different mix of housing types. The request for proposals “set the threshold for 50 affordable units and only two proposals had more than 50,” Gillotti said.

“The goal is each year to remove some of these issues, some of these barriers so that we can get closer to building more and more affordable units in Ann Arbor and Pittsfield and getting closer to that goal,” Gillotti said. 

Labarre said it’s a matter of ethics. “This is an issue of how do we want to proceed as our community in the next five, 10, 20, 50 years? The issue of economic inequality has gotten worse in this country as a whole. I think a lot of that was initially policy driven, but I think there is a moral case to be made that we should do things that are appropriate.”

Rabab Jafri

Rabab Jafri is an intern with The Ann magazine. She follows up on statements and questions raised by ANNtourage participants. She’s a student at the University of Michigan.

2 Comments

  1. Jeff Hayner

    February 8, 2017 at 3:17 pm

    What if we looked at the problem of affordable housing from a contrary perspective. What if instead of looking for ways to increase availability of affordable housing and prevent pockets of poverty from forming in our community, we look for ways to decrease availability of expensive, market-rate housing, and try to prevent pockets of extreme wealth from forming? One outcome: it require an end to our city council’s practice of excessive, wasteful spending which I fear is impossible to overcome. It would also go against years of central planning – the drive to make Ann Arbor a wealthy enclave to feed the city hall’s (and DDA’s) insatiable desire for more tax revenue.

    Also, there is something going on in the affordable market that has received little attention and needs to be addressed. Avalon is buying up units that are currently privately-owned (open-market) affordable, and converting them to publicly-subsidized affordable. There is no net gain in people housed or available affordable units, just a transfer of who is paying for the housing, and who “qualifies” to live there. This process actually results in a net loss of affordable housing, as the tenants that were paying rent to the private owners are now “on the street” competing for an increasingly limited supply of “open-market” affordable housing. Why do we continue to support this losing scheme?

    The same could be said for the public-housing renovating craze of late. We are spending many millions, and not gaining units. Yes, our public-hosing stock is a little run-down but is it bad enough to spend the kind of money we are in renovating? Wouldn’t that money be better spent building new units? Until we are closer to our “total % of affordable unit” goals we should only be adding units, not virtually adding ala Avalon, and not renovating perfectly serviceable units. Both private and public aff. housing is affordable for a reason – it isn’t that great. But it’s better than the alternatives. As a contractor/maintenance man I’ve seen it all – our worst public housing stock is much nicer and safer than many low-income private homes, or even private rentals. Just because a place passes rental inspection doesn’t mean it’s a nice place.

    P.S. I don’t want to hear from any Supply & Demand types saying that constant market-rate building is going to eventually bring prices down, if only the city would let us build MORE & FASTER! Bull. That only works in the hypothetical free market of your Econ textbook. We do not have a free market.

  2. Ronald Baskin

    August 17, 2017 at 10:22 am

    Great article! I have a carpet and floor store in Ann Arbor MI http://www.aacarpetandfloors.com

    I strongly believe that we need more affordable housing in the area. Keep writing these articles!

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