The recent New York Times story about suburban poverty is getting a lot of attention.  The story notes the shifting growth of poverty from the urban core of New York to its suburban peripheries, but it’s based around Confronting Suburban Poverty in America, a book released today by Elizabeth Kneebone and Alan Berube at the Brookings Institution.  Admittedly, I haven’t read the book yet (yet!), but this trend came up in some data I was looking at recently.  In Virginia, Richmond and its immediate counties – Chesterfield and Henrico – are good examples of this trend in action.

The shift of poverty growth from the city to the suburbs is a trend we can see pretty clearly in the numbers.  A look at data comparing poverty in the City of Richmond and the counties of Chesterfield and Henrico, shows trends that aren’t far off from those outlined in the Times article.

The City of Richmond gets attention throughout the region for its poverty rate, which was 26.4 according to 2011 estimates.  The city’s mayor, Dwight Jones, made the development of an antipoverty strategy one of the first priorities of his second term.  But the bulk of the region’s poverty growth – numbers of people rather than rates – is happening in the suburbs.

From 1989 to 2011, which is as far back as the Census Bureau’s Small Area Income and Poverty Estimates go, the City of Richmond’s population in poverty has grown by about 14%, or about 6,200 people.  In terms of poverty rate, that’s a 3.4 point increase, from 23.0 to 26.4.  In the same time period, Henrico has seen its population below poverty grow by 163% (20,500 individuals), and Chesterfield by 181% (14,500 individuals).

Suburban poverty rates remain lower the city’s 26.4, but poverty growth in the counties has outpaced total population growth.  Point increases in the poverty rate of a suburban county – where the total population has been growing rapidly for decades – represent more people than point increases in the rate of the city – where the total population only recently reversed its shrinking numbers.  Henrico’s poverty rate increased 5.0 points between 1989 and 2011 (5.8 to 10.8).  Chesterfield’s increased 3.4 points (3.8 to 7.2).  As noted above, Richmond also had a 3.4 point increase over those 22 years.  But Chesterfield’s 3.4 point increase represents 14,500 individuals, more than double Richmond’s 3.4 point increase of 6,200 individuals.

The chart below shows pretty clearly just how significant those changes have been:

The growth of poverty in jurisdictions throughout the region is cause for concern, and the trend of more rapid suburban growth is important.  As the suburban population of individuals below poverty increases, Richmond’s share of the region’s poverty drops.  In 1989, the city’s share of poverty among the three jurisdictions was 68.5%.  Today, it’s 47.9% (see the chart below).  There are more people in poverty in the immediate suburbs of Richmond than there are in the city.

The shifting geography of poverty away from the region’s urban core has important implications for policy decisions at the local and regional levels.  While there is still need for the antipoverty resources and strategies traditionally concentrated in the city, the counties are facing a growing problem.  The more widely distributed suburban residential patterns may make addressing those needs more costly.

Urban poverty in the Richmond region isn’t shrinking, but that’s not for lack of attention or effort.  Suburban poverty in Richmond has surpassed urban poverty in total numbers, presenting new challenges to the counties.  As the population of suburban poor continues to expand, antipoverty resources and infrastructure – affordable housing, access to public transportation, and linkages between housing, transportation, and job centers – will only increase in importance across the region.

George Mason University Economics Professor Don Boudreaux wrote recently: “I do not in the least care about income (or wealth) inequality.”

Don Boudreaux

This seems a pretty bold and heartless statement, but he clarifies:

“I care – very deeply – whether the process for pursuing one’s life’s goals is fair or not.  I want everyone to have as fair a chance in the economy as is humanly possible.  I despise special privileges that stack the deck either in favor of Jones or against Smith.  (We can have a debate about what the details of “fair process” and “special privileges” look like, but this post is not the place for such a debate.)  But I do not care about differences in monetary income or wealth as such.”

Every American is entitled to a fair chance to succeed in our economy. But here’s an incontrovertible fact: human bias and prejudice actively prevent some Americans at a fair shot.

What am I talking about? I’m talking about housing discrimination.

For example:

Zenobia of Petersburg Virginia wanted to move her family to a better neighborhood so her four children could attend better schools and build a better life for themselves. Unfortunately, she was turned down for housing repeatedly because she uses public assistance to pay for rent. This type of housing discrimination reduced the fair shot Zenobia is entitled to.

A recent study found that many low income Americans are trapped in areas with fewer opportunities:

One of the most disappointing results of the study, Tegler says, is that the majority of recipients of the Housing Choice Voucher Program still live near low-performing schools, even though the program is designed to provide greater housing options.

It is humanly possible to give these folks a fair chance in our economy. We have to eliminate discrimination against people using public assistance for housing. When people are able to choose great neighborhoods themselves, they will have the fair shot they are entitled to in our economy. We must also make sure that there is affordable housing in great neighborhoods.

America is becoming more and more diverse. Given how much middle class wealth depends on home ownership and home values, if we do not significantly reduce mortgage lending discrimination, then we are placing our future economic prosperity at risk.

Heather Crislip

HOME CEO Heather Crislip writes about mortgage lending discrimination in her recent op/ed:

Subprime lending to minority borrowers has abated within the past few years; in its place is a lack of credit and, in turn, opportunity in African-American, Hispanic and low-income neighborhoods. During the housing boom these households were often targeted by unfair lending practices through the distribution of inferior mortgage loan products to qualified borrowers. The Center for Responsible Lending found that African-American and Latino borrowers with good credit were given high interest rate loans three times as often during the housing boom.

According to the US Census, by the end of this decade no single racial or ethnic group will constitute a majority of children under 18. And in about three decades, no single group will constitute a majority of the country as a whole. But as we are growing more diverse, we are also growing more unequal. Both wealth and racial inequality have increased, in some cases dramatically.

Wealth inequality:

The biggest difference between the most-affluent and everyone else, according to research by the Pew Research Center, is that the wealthiest households have their assets concentrated in stocks and other financial instruments, while others’ wealth is concentrated in their homes. Which begs the question, how do low-to-moderate income families in Virginia build wealth when they don’t have access to credit to finance a home?

Racial inequality:

According to a recent study by Duke University: Black and Latino home buyers pay about 3.5% more for housing than whites and Asians. This percentage can translate to about $5,000 or $10,000 per housing sale.

If we do not significantly reduce mortgage lending discrimination, then we are placing our future economic prosperity at risk. If discriminatory lending patterns and practices continue unabated, it will be a problem for the new American majority.

Robo-signing was a significant problem in Virginia that raised serious questions about the sanctity of property rights in the Commonwealth. It was such a serious concern, that a community group in Northern Virginia organized citizen volunteers to investigate this problem in Prince William County.

This is the second time Virginia will receive a multi-million dollar settlement related to the foreclosure crisis. Last year, Virginia received $66 million from the National Mortgage Settlement. This money was supposed to be used for housing. Unfortunately, the Virginia General Assembly did not invest the money in housing, instead the GA used the vast majority (roughly 90%) of the settlement to fill routine budget shortfalls. Only $7 million was allocated to housing via the newly created Virginia Housing Trust Fund. While we are grateful that some of this money was invested for housing, this was a once in a lifetime settlement (it was second, only to the big Tobacco company settlement)!

Attorney General Ken Cuccinelli sent this letter to legislative leaders, stating:

As I noted when I turned over the more than $66,000,000 paid directly to the Commonwealth as a result of the National Mortgage Servicing Settlement, I gave up the right to appropriate money when I left the General Assembly. However, given that a significant portion of the funds to be swept are related to settlements tied to housing issues, I respectfully request that you consider utilizing some portion of the $3.5 million LPS settlement to address housing issues.

For the sake of Virginian’s families and local governments still struggling with housing issues related to the foreclosure crisis, my sincere hope is that the General Assembly utilizes all of this settlement for housing.

The Anti-Poverty Commission is a diverse and impressive group of business leaders, academics, faith leaders, policy makers, and community advocates. HOME’s Vice President, Lorae Ponder, was appointed to the Commission and served on the Education and Workforce Development committee. Ponder states,

“I was honored to work with such an exceptional group of thought leaders. We each came to the table with different perspectives. The Commission also included some representation from the counties, demonstrating the need and desire for regional cooperation, which is foundational to mitigating poverty in the City of Richmond.”

According to the 144 page report, over 25% of city residents currently live in poverty as defined by the federal government. That rate is twice as much as national average, the Richmond metro area, and the commonwealth as a whole. It is also several times higher than poverty rates in surrounding counties. Thirty-one percent of all people living in poverty in Richmond are children. Perhaps even more shocking, 39% (nearly 2 out of 5) of all children living in the City of Richmond are living in poverty. In addition, nearly 50% of the city’s population is poor, near-poor, or at risk of falling into poverty (defined as households with income less than $35,000).

Within the report, the Anti-Poverty Commission makes two kinds of policy recommendations to combat poverty in Richmond. First, is to reduce poverty by increasing household incomes. Second, is to mitigate the effects of poverty by increasing access to opportunity throughout the Richmond region. “In my view,” explained Ms. Ponder, “housing and transportation are at the core of this issue.”

The Anti-Poverty Commission’s recommendations echo the findings in HOME’s December 2012 report Where You Live Makes All the Difference: An Opportunity Map of the Richmond Region. Each suggest a regional approach to economic development and housing policies are needed to ensure the future vitality of the region and combat the concentrations of poverty within the city. Both reports stress the necessity of a regional public transit system.

Transportation

The Anti-Poverty Commission report addresses the importance of transportation by recommending a regional Bus Rapid Transit (BRT) along the major transportation corridors in the metro area including Rt.1, 60, 360, and 250. There are almost 128,000 jobs along these high-travel corridors that are currently unreachable by public transit. In the 2011 Brookings Institute publication, Missed Opportunity: Transit and Jobs in Metropolitan America, Richmond ranked 95^th out of the nation’s top 100 metropolitan areas in terms of transit coverage.

Effective transit will not only increase access to suburban employment opportunities, service providers and retailers for city residents, it will also increase access to work and entertainment destinations in the city for suburban residents. This is one of the many benefits for all residents in the region. An effective transit system is also a key factor in attracting companies to the Richmond region that are expanding operations, opening regional offices or establishing corporate headquarters.

There is overwhelming public support for a regional transit system. Ninety-six percent of public meeting attendees and 82% of those surveyed online voted in favor of expanding transportation service.

Housing

The Unique, Healthy & Inclusive Communities committee was charged with developing strategies that support the redesign of high-poverty communities and the inclusion of social supports and outlets for children, youth, families, and elders.

The report offers two major recommendations to improve housing conditions:

• Redevelopment of current public housing stock utilizing a public policy strategy that does not displace low-income residents and proactively fosters trust among planners, the city, developers and residents

• Train and employ Community Navigators and Service Coordinators as part of a supportive housing strategy within high-poverty communities

While the report recommends the City Administration develop a truly comprehensive, citywide housing plan encompassing the public and private sector, it does not address the specifics of what that would entail in this report. It does stress the need for expanding quality affordable housing stock and preserving, rehabilitating and developing existing housing stock in a plan that is distinct from any internal plan of the RRHA.

The report urges the City to create a housing plan with a holistic approach to finding housing solutions that benefit the region, in the same way that the Anti-Poverty Commission took a holistic approach to confronting issues related to poverty.

Implementation and Accountability

The Anti-Poverty Commission was very clear in the report with regards to expectations for implementing policy recommendations.

First, the report challenges City Administration with developing a strategic plan including specific budgetary requests, to begin implementation of all five Top Tier, high-impact recommendations as well as feasible Second Tier recommendations by February 15, 2013. Top Tier recommendations include creating a regional rapid transit system and the redevelopment of much of the city’s public housing stock without involuntarily displacing residents.

The report also recommends creating a permanent, independent citizen commission reflecting a cross-section of the community to monitor and evaluate progress, clearer communication across government offices, sharing the report with policy makers throughout the region, and establishing one or more dedicated staffers to monitor and coordinate the anti-poverty agenda.

Mayor Jones has indicated he would like to see a timeline of what can be done for the upcoming fiscal year, what is already underway, what recommendations will take longer to implement and what should be included in future budgets. The City Administration will be working closely with City Council to implement recommendations of the report.

The City of Richmond cannot achieve the agenda of the Anti-Poverty Commission alone. Without a commitment from policy makers across the Richmond region, residents of the city living in poverty will continue to be isolated from job growth and areas of high opportunity. Consequently, Richmond region will remain a less competitive region than similar-sized metropolitan areas.

“The report rightly acknowledges that city government has limited resources and capacity to tackle this problem,” said Mayor Dwight C. Jones. “That’s why the work of this commission has been so important in that this report can provide a roadmap for us to create a comprehensive anti-poverty strategy involving all stakeholders. I believe we can make a meaningful difference over time if we all work together.”

HOME’s Lorae Ponder agreed stating,

“The recommendations are sound and represent best practices for addressing this issue. If followed, we will make tremendous strides in mitigating poverty and improving the quality of life for families in the region. If we try and solve the problem of poverty without addressing housing in an intentional and strategic way, we are missing the boat.”

Wanda Porter

This is a guest post by Wanda Porter. Wanda is HOME’s Events & Cause Marketing Associate and an AmeriCorps VISTA. Before arriving at HOME, Wanda freelanced in the film industry and served as Director of Client Services for a small ad agency in Chicago. Above all, she is the proud mama of three magical little girls.

Va House Speaker Bill Howell introduces Gov. McDonnell’s transportation package

The Virginia General Assembly moves pretty fast, leaving citizens with many concerns about what is happening with transportation. Despite the extensive media coverage, the details keep changing and many Virginians aren’t quite sure of the details lawmakers are proposing and debating. To help educate everyone about what’s going on, I’m summarizing the most recent developments and policy concerns.

Transportation is deeply connected to housing and we have to ask some serious questions about the current transportation proposal moving through the Virginia legislature. We know that the lack of affordable housing has forced Virginians to live farther away from their jobs which adds more congestion on our roads. We need a 21^st century transportation solution.

Gov. Bob McDonnell has put forward a transportation proposal which  basically:

• Raises the sales tax
• Permanently diverts more of the sales tax away from the General Fund (which also funds core services like education and health care) toward transportation
• Eliminates the gas tax
• Increases some transportation related fees, such as a fee on hybrids

Many legislators also put forward transportation proposals. Some were similar to the Governor’s, some were very different.

Gov. McDonnell’s proposal was introduced in the House of Delegates by Speaker Bill Howell and in the State Senate by Senator Steve Newman. Both of these bills advanced out of their respective Finance Committees and are heading to the full House & Senate floor. The Speaker’s bill will definitely pass the House Floor without any changes.

The Senate version passed the Senate Finance Committee on a strict party line vote of 10 – 5 this past Thursday and is headed to the full Senate.

One strength of the Governor’s proposal is his serious effort to raise new revenue to address our transportation needs. However, there are many critiques of his proposal. For example:

1. Eliminating the gas tax means people who use mass transit, bike, carpool, or drive less are subsidizing people to drive more. It also means that out of state drivers get to use Virginia’s roads for free/dramatically less (they may still pay sales tax if they stop and shop in Virginia)
2. Permanently diverting money from the General Fund could have a serious negative impact on public education. Virginia is a growing state, and permanently reducing how much money is available in the General Fund for education, among other things, is definitely going to cause a problem.
3. Raising the sales tax has a disproportionate impact on low & moderate income Virginians. This could be remedied by making the Earned Income Tax Credit refundable in Virginia.
4. The proposal only addresses the shortfall for maintenance. We won’t have enough money for new construction or investments in new solutions like mass transit.
5. Much of the revenue depends on the passage of legislation by Congress, which is not certain.

It is important to get some of these details right because everyone will pay more in taxes yet the transportation problem will not be solved. Legislators will have taken a hard vote and there will be little political will to come back and address revenues for new construction.

So what happens now? The Senate bill will go to the Senate floor where there is a 20-20 split between Democrats and Republicans with Lt. Gov. Bill Bolling as the tie breaking vote. The bill could get amended on the Senate floor, but it’s unclear how heavily it will be changed. The bill was already amended slightly in the Senate subcommittee.

The real work of compromise and change will most likely happen behind closed doors when the House bill and the Senate bill go to conference.

Will new transportation developments improve access that low and moderate income Virginians have to areas of high employment growth? Over the past few decades, the spatial mismatch between job creation in the suburbs and low‐income workers in the inner city has become more severe. This imbalance between jobs and housing deprives citizens living in areas where housing is affordable from accessing employment opportunities in high job‐growth areas. New transportation developments must focus on increasing access low income Virginians have to areas of high employment growth. This means not only roads, but also options such as mass transit.

For example, only 53% of the region’s jobs are served by the Greater Richmond Transit Corporation. Very few bus routes even extend into the surrounding counties. Those that do are primarily express lanes serving people coming into the city for jobs, not people going out of the city for jobs. This data was published in a report by HOME in December 2012 entitled Where You Live Makes All The Difference:  An Opportunity Map of the Richmond Region.

Are we aligning transportation with housing? Sprawl development has forced people to drive farther to get to work, school, and other activities. We need to promote transit oriented development. Simply increasing the number of roads will not create a 21^st century transportation solution. Virginia should diversify its transportation investments. Instead of focusing solely on road construction and maintenance, more funds need to be invested in alternatives to driving in order to help extend and improve connections within localities and regions. This includes greater funding for public transit, bicycle and pedestrian infrastructure, bus rapid transit and light rail. Eliminating the gas tax is concerning because it means that the person who decides to carpool, or ride a bike is now subsidizing the person continuing to use a car.

For example, in one low income census tract in the Church Hill area of Richmond, 17% of the population has commute times of over 45 minutes, despite 25 GRTC bus stops. In contrast, a high income census tract in Chesterfield County (which has 0 GRTC bus stops) only 7.5% have commute times of more than 45 minutes. If all Virginians are going to pay more in taxes, they all deserve to have their transportation system meet their basic needs, especially the most vulnerable. This was also covered in HOME’s report Where You Live Makes All The Difference:  An Opportunity Map of the Richmond Region.

How are low and moderate income neighborhoods affected? Large increases in the sales tax would hit low income Virginians the hardest. As a share of their income, low- and moderate- income households spend more than high-income households buying the basic necessities of life such as clothing, toiletries, and school supplies, which are subject to Virginia’s sales and use tax. According to The Commonwealth Institute: a family making less than $21,000 a year would see its taxes rise by about .21 percent under the governor’s plan. However, households making over $509,000 a year would see an increase of just .05 percent.

Also, diverting sales tax revenue away from the General Fund and towards transportation would have a serious negative impact on Virginia’s education investments. Over the past several years, the Virginia General Assembly has reduced state aid to schools. Virginia is ranked as the 9th wealthiest state but ranks 38th in the per‐pupil funding coming from state sources. According to the Virginia Education Association, Virginia has cut per-pupil aid almost 20 % since 2009. Per‐pupil state aid has been slashed from $5,274 in 2009 to $4,233 in 2012 in inflation‐adjusted dollars.

The U.S. Department of Housing & Urban Development announced a fair housing settlement with a property management company in Va Beach. I’ve bolded some sections for emphasis:

a Hispanic woman filed a complaint alleging that Virginia Realty, a property management company that manages over 500 rental units throughout Virginia Beach and Norfolk, refused to provide her a rental application because she could not speak English well and refused the translation assistance of the bilingual person she brought with her.

…

In the course of the investigation, HUD discovered that Virginia Realty had a written policy expressly requiring all prospective tenants to be able to communicate with management staff in English without assistance from others, and to complete rental applications only while they were in the management office.