Neoliberalism and DC's Capitol Hill, where residents continue to express opposition to a proposed affordable housing project for seniors

I joke that the more I learn about real estate development, the more I become an intellectual Marxist.

However, while Marxism is great for understanding the motivations of capital, its proscriptions for change don't work so well, and in any case, the system of capitalism is not likely to be overthrown any time soon.

But sometimes, the actions of citizens in throes to capitalism, and to neoliberalism, which is focused on the privatization of government action and property make me even more sympathetic to the Marxist position, although my "pro"-development approach likely brands me a conservative by many even though I term myself a progressive.

This comes up in Capitol Hill, where for some reason residents including their representatives on the local Advisory Neighborhood Commission, prefer that a city-owned property be converted to market rate housing, instead of being redeveloped as a senior housing building offering less than market rate rents.

I wrote about this before ("Senior housing needs vs. "the market" and government involvement: Part 2 - Capitol Hill and ANC6B's opposition to senior housing").  But it comes up again as Capitol Hill Corner reports on the latest developments ("Hill East Neighborhood Coalition Pushes to Reopen Bidding on Boys and Girls Club").

Former Eastern Branch, Boys and Girls Club, located at 261 17th St. SE.  This property came under city control when the Boys and Girls Club organization downsized and sold many of their properties.  The city stepped in and acquired them.  Photo from Google Maps.

They criticize the senior housing project as "requiring subsidies," implying the funds would come from local government funding sources, but instead the monies would come from the use of federal tax credits, with no impact on the local budget.

And they argue against the project because the local senior aging in place initiative, Capitol Hill Village, isn't a proponent.

The proposed apartment building would offer single floor living and an elevator-served building, as opposed to multi-story rowhouse living and/or having to go up stairs to enter the building.

I don't totally love this design, but I can't knock the value of the project. 

Note that the Vida Senior Residences building on Missouri Avenue NW in Ward 4 is a project very similar to the one proposed for Capitol Hill.  See "With Vida Senior Residences, abuelitos get a new lease on their golden years," Washington Post.

This webpage describes the complicated financing required in raising $8.6 million to construct the building, which is operated by a local senior service organization.  Such complications are pretty typical for a non-market rate housing development.

The kitchen-dining area in the Vida Senior Residences building.  Images from Dantes Partners.

Vida Senior Residences has 36 furnished studio apartments, and rents range from about $290 to $850 per month, depending on income, and significantly below market rate for new housing.

By contrast, at the new Station House apartment building, studios start at $1,710 per month, although the building is in a better and more connected location, and has skee ball among other amenities.

1.  Capitol Hill isn't suffering from the lack of market rate housing.  According to the Neighborhood Info website, ANC6B, where the site is located, has 9.680 housing units as of the 2010 Census and a home ownership rate of 55%, and the median sales price (half above/half below) for a house is $670,000 as of 2013.

Although it should be noted that there are a number of public housing projects in the ANC6B geography, more likely than any other ANC with similar high income demographics.

2.  The Aging in Place initiative by Capitol Hill Village is not the only way to support senior living options. In fact it can be argued that such initiatives also encourage "overhousing" and underutilization of scarce housing resources, and economic stagnation within local commercial districts ("It's impolitic to say but no property taxes for older senior citizens is a bad idea").

3.  Offering subsidized rents expands to lower income demographics the ability to live in quality neighborhoods.

4.  The proposed project in Hill East is also in line with the various city policy objectives concerning the expansion of affordable housing.

Senior housing needs vs. "the market" and government involvement: Part 2 - Capitol Hill and ANC6B's opposition to senior housing

In strong real estate markets, of which DC is decidedly, especially west of the Anacostia River, market production of housing tends to be focused on the more expensive segments of the market--partly because of demand but also because that is where the most profit can be obtained (not that the profits are extraordinary, unlike what people think).

That's why "the government" steps in to support the production and maintenance of affordable housing, usually multiunit, in a variety of ways including financial support, land, preferences in development opportunities--usually with government land, density bonuses, transferable development rights, etc.

Former Eastern Branch, Boys and Girls Club, located at 261 17th St. SE. This property came under city control when the Boys and Girls Club organization downsized and sold many of their properties. The city stepped in and acquired them. Photo from Google Maps.

Currently, the city has a tender for the former Boys and Girls Club site in Eastern Capitol Hill in Washington, DC and the particulars of the RFP favor use of the site as social housing, with the aim of adding to the stock of social housing in a submarket that is dominated by market rate housing.

The city received two proposals.  One would deliver 49 units, in part through a two-story addition, 100% affordable focused on the senior living market, while the other proposal is for 25 units of market-rate housing, and would not modify the building envelope in a significant fashion.

But according to Capitol Hill Corner ("City Pushes 100% Affordable Housing Proposal for Boys and Girls Club in Hill East"), the local neighborhood commission, ANC6B, is decidedly against the project that city policy concerning housing production involving government controlled land favors, and instead prefers a smaller project that would provide market rate housing.

Differentiating between the two projects, to my reading, the article and ANC6B Commissioner Brian Flahaven use pejorative language, terming the use of FEDERAL LOW INCOME HOUSING TAX CREDITS as "a subsidy."

Rendering of the building proposal by Dantes Partners.

ANC6B couches its opposition in terms of flawed requirements in the tender, making the market rate project unable to compete. (Although I suppose that opposition could be offered in terms of the discordant design of the proposed addition.) From the Capitol Hill Corner article:

One of those concerns was that DGS had stacked the deck in favor of Dantes/Menkiti by limiting the lease to 25 years – effectively limiting financing to public funds, since private equity needs for a major overhaul would be impossible on such a short-term lease. In addition, DGS ruled that developers must comply with a new District law requiring 30% affordable units in projects on property surplused by the city, a law that passed after the initial request for bids to redevelop the Boys and Girls Club was issued.

Capitol Hill doesn't suffer from a lack of market rate housing, it has thousands upon thousands of single family houses (mostly rowhouses), with some apartments and condominiums.

You could argue that there aren't enough apartment options in the core of Capitol Hill--which mostly was developed before 1915, although plenty of multiunit housing is being developed south (Capitol Riverfront) and north (H Street NE, NoMA), with a new development of 600 one- and two-bedroom apartment units to the east on Reservation 13 (Capitol Hill East | Donatelli Development) and immediately abutting the greater neighborhood.

There is a smattering of social housing (Potomac Gardens, Kentucky Courts, Ellen Wilson Dwellings, Capper/Carrollsburg--the latter two were rebuilt and the amount of social housing units reduced, as part of HOPEVI redevelopment projects).

It's true that some of the public housing developments are problematic in terms of crime and the reality is that Capitol Hill probably has more social housing units by comparison to Wards 2, 3, and 4. There are two senior housing buildings in the H Street neighborhood, some in the area south of the Southeast-Southwest Freeway (I-695), and maybe others elsewhere in the ward with which I am unfamiliar.

But the reality is that there are few senior housing options that allow residents to downsize from multiple-floor single family row/houses where they are currently "overhoused," to smaller, one-floor units, still in the neighborhood.

The opposition by the ANC has a tinge of Yonkers--the City of Yonkers in Westchester County, immediately north of New York City fought HUD and the US Department of Justice for many years in the city's desire to keep its public housing segregated and away from higher income neighborhoods ("After 27 Years, Yonkers Housing Desegregation Battle Ends," New York Times).

The city is right, ANC6B is wrong.  The market doesn't have much problem providing market rate housing.  The social housing market is disadvantaged operating in a high value market.  Therefore, the city's policy of preferencing social housing for the use of this particular site is reasonable.

Are Capitol Hill activists hypocrites when it comes to affordable housing?   Market rate housing will be constructed on the site of the former Hine Junior High, immediately across from the Eastern Market Metro Station, and that site will have some affordable housing.  Residents opposed to the height and mass of the project raised a variety of arguments against the project, including alleging that affordable housing will be accommodated in sub-optimal ways and that tax credits were misappropriated in a manner counter to public policy.  See "Court Allows Hine School Development to Move Forward" from the Washington City Paper.

It's fair to say that the opponents didn't care about the provision of affordable housing except as an opportunity to raise objections to the project.

Clearly a similar and very unattractive sentiment is being expressed here.

Conflicts between neighborhood preferences and other policies of local government.  Besides being an incredible example of neoliberalism in local planning (neoliberalism privileges the market and denigrates the role of the government as an actor in general and as a provider of services), it is an example of one of the problems in hyper local planning (cf. the adoption of a "local planning" paradigm in the UK under the current Conservative Government) when resident interests fail to balance what tend to be narrower interests with broader public policy and "city-wide" issues, in this case the provision of social housing and housing to certain types of households under-represented and under-served by the market.

Other examples of neighborhood opposition to local government policy.  It reminds me of a similar case in Baltimore County.  Eastern County tends to be "against" public transit because transit is used by "those people".  And one of the neighborhood plans--in Baltimore County, unlike DC, neighborhood plans area are produced by coalitions of organizations representing various neighborhoods, not the planning office--came out against transit, even though the county supports public transit in the Master Plan.  The transportation planner in the Department of Public Works was appalled, as was I, but we weren't the "community planner" for that Council District--still, she should have stepped in, as someone needs to step in here.

Another interesting Baltimore County example is how non-farming residents in the defined rural section of the county tend to be against "farms" provided value added sales options, such as a dairy producing ice cream, out of a fear of increased traffic.  See "Baltimore County bill sparks debate over tourism on farms" from the Baltimore Sun.)

But should non-farming residents be able to dictate how a farm should be managed, and how it should respond to changing market conditions?  Are the farms merely baubles and visual amenities for non-farming residents who moved to the rural section of the county attracted by the bucolic landscape provided by the farms?

Neighborhood councils need more technical support and capacity building.  These cases demonstrate the need to pay attention to this kind of problem and that capacity building and technical assistance should be provided to neighborhood councils so that they can better appreciate and carry out their multiple responsibilities to their neighborhood and to the city, which is their duty as elected public officials, even at the level of neighborhood council.

Rather than representing only one interest, neighborhood council representatives need to ensure that they fulfill all of their duties to represent the public, not just neighborhood interests.