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«A Journal of Policy Development and Research HoPe VI Volume 12, Number 1 • 2010 U.S. Department of Housing and Urban Development Office of Policy ...»

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Redevelopment itself can lead to improved physical design of the properties, which can facilitate greater social interaction among residents of the properties and those in the surrounding neighborhood. Such interactions can help build greater trust and social capital, which contributes to greater collective action, reduced crime, and greater economic stability (Fukuyama, 1995; Morenoff, Sampson, and Raudenbush, 2001; Saegert, Winkel, and Swartz, 2002). HOPE VI communities are intended to be mixed-income developments, and the presence of higher income individuals tends to be associated with higher rates of homeownership, greater social organization, reduced crime, and general community stability (Joseph, 2006). The development and renovation of housing also tends to have positive effects on nearby property values.3 In examining neighborhood change, the study focuses on three key indicators: changes in residential property values, changes in crime rates, and changes in household incomes. Elements of the HOPE VI program are likely to affect each of these indicators. Although the price of a home reflects the characteristics of the property, it also partly reflects the value that individuals place on the surrounding neighborhood. To the extent that a neighborhood improves—or the perception of the neighborhood improves—that improvement should be reflected in higher sales prices for homes.

As noted previously, public housing developments have frequently been associated with high rates of crime and violence—problems that have frequently seeped into the surrounding neighborhoods, reduced the quality of life for local residents, and decreased the chance of additional investment in the area. In addition to redeveloping the properties in ways that are more conducive to public safety, the HOPE VI intervention provides an opportunity for local housing authorities to impose rigorous screening criteria on new or returning tenants. Such opportunities increase expectations for a noticeable reduction in violent crime in the areas surrounding the redeveloped properties.

Finally, one goal of the original HOPE VI legislation was to reduce the concentrated poverty prevalent in most of the severely distressed public housing properties. Reducing the concentration of poverty, coupled with improving public safety, could attract more moderate- and middle-income residents to the surrounding neighborhoods. Such an income mix would be more likely to attract and sustain additional private investment and thus better integrate the neighborhood into the regional economy.

For each of the three key indicators (changes in residential property values, changes in crime rates, and changes in household incomes), we developed interrupted time series statistical models that allowed for changes in levels and trends in the outcome variables before and after the HOPE VI redevelopments. The models control for a variety of regional economic trends and thus measure how the HOPE VI neighborhoods performed relative to their surrounding communities both before Goetz, Lam, and Heitlinger (1996); Ding, Simons, and Baku (2000); Schill et al. (2002); and Galster, Tatian, and Accordino (2006) all found positive neighborhood spillover effects associated with renovation investment.

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and after redevelopment. If the neighborhood’s relative performance improved after HOPE VI redevelopment compared with its relative performance before HOPE VI, the study suggests that the HOPE VI intervention was a significant contributor to that improvement.

The quantitative analyses help identify the relationships between the HOPE VI redevelopments and specific measures of local change, but they provide relatively little insight into the process by which change occurred or the role of other, less easily quantifiable factors in bringing about that change. Because quantitative measures can only hint at the changes in perceptions that typically precede investment decisions, we augmented the quantitative analyses with site visits to the different properties and their neighborhoods and with interviews with individuals knowledgeable about the HOPE VI properties and local community dynamics. Those interviewed included administrators at the respective housing authorities; police officers assigned to the neighborhoods;

leaders of neighborhood-based organizations; lenders active in the sampled communities; citywide community development organizations; elected public officials; and heads of relevant city agencies, such as the housing, planning, and economic development departments. We selected the individuals based on recommendations from local housing authority officials and from our own community development contacts in Boston and Washington. Appendix C provides a list of those interviewed.

Although no formal interview protocol was in place, we asked all those whom we interviewed roughly the same questions. We probed their recollections of neighborhood conditions before the HOPE VI redevelopments and asked them to draw comparisons between the dynamics then and now. We asked them to document as best they could the changes that had occurred in the targeted communities and to identify the factors that they thought had contributed to those changes. We asked specifically about the role of the local public housing complex in catalyzing or retarding change. How much of the change might have occurred without any improvement in public housing? What role (if any) did particular organizations and institutions play in changing neighborhood conditions? We also asked certain people to estimate the effects that a similar HOPE VI intervention would have on specific traditional public housing properties located elsewhere in the city.

The analysis examined changes in neighborhoods surrounding four HOPE VI redevelopments— two each in Boston and Washington. In each case, the public housing property in question had become badly deteriorated and functionally obsolete. The two major options were to continue trying to maintain the flawed property as public housing or to embark on a major redevelopment of the site through the HOPE VI Program. Our analysis assumes one of these two options.4 We chose two sites in each city to ensure some diversity of neighborhoods. We selected HOPE VI sites based on the recommendations of the Boston Housing Authority (BHA) and the District of Columbia Housing Authority (DCHA), with the assistance of the Council of Large Public Housing Authorities. We required that sites be family developments with at least 100 units and whose redevelopment had been largely completed by 2004, in the interest of selecting large enough properties to have meaningful spillover effects and to have some post-completion data with which to measure those effects. Because few sites met these criteria, we did not have the opportunity A third alternative might have been to sell the properties to private developers for them to use as they saw fit (with housing vouchers being given to the affected public housing residents). In light of the federal policy at the time to keep public housing units on the sites, this sale option was not realistic.

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to try to control for neighborhood characteristics, except to avoid sites whose neighborhoods overlapped. We recognize the potential biases associated with this selection approach, but we note that the distribution of HOPE VI grants has itself often been biased in favor of communities whose characteristics enhance the likelihood of local revitalization.

The remainder of this article is structured as follows. The next section provides some background on each of the selected HOPE VI sites, situating them in their local context. The background is followed by more detailed discussions of our methodology and findings regarding effects on property values, crime rates, and resident incomes in the neighborhoods surrounding the HOPE VI sites.

We seek to interpret the findings through more detailed contextual analyses and conclude with some recommendations for maximizing the neighborhood economic effects of future HOPE VI projects.

HOPE VI Sites The analysis in this study focuses on selected public housing sites in Boston and Washington (exhibits 1 and 2), two cities that have ranked statistically among the strongest economies and have endured some of the tightest real estate markets in the country throughout much of the past 15 years. Even historically distressed communities in these cities experienced multiple years of double-digit gains in property values.

Boston: Mission Main Built in 1940, Mission Main initially consisted of 1,023 units spread among 39 three-story buildings on 22 acres. By the early 1990s, Mission Main ranked as the most troubled property in the BHA portfolio. Fully 74 percent of people who were offered units in the complex refused them, and 93 percent of all new tenants moving into the property in 1992 were formerly homeless individuals. By 1993, only 680 of the complex’s then 822 units were occupied, and 68 percent of resident households had no earned income. Drug dealers frequently operated out of the vacant units, and the property featured the largest open-air heroin market in New England. The BHA’s 1993 property assessment found that 56 percent of the complex’s buildings were in poor condition, and the site suffered from outdated drainage, sewer, plumbing, and electrical systems.5 At the same time, Mission Main occupied increasingly choice real estate. The Northeastern University and Wentworth University campuses are in the immediate area, and the Longwood Medical Center sits a couple of blocks to the north. Two streetcar and subway lines are within easy walking distance.

To the south lies Mission Hill, a historically stable, middle-class community. Mission Main was the only part of the community that had not seen notable development, and its problems were hindering the future growth of the area. In 1993, the BHA applied for and received a $49.9 million HOPE VI grant to redevelop Mission Main in a way that would integrate it more with the surrounding area.

By the time the three-stage project was finished in 2002, the site contained 535 apartments in a mix of midrise and garden-style apartments. Of these units, 444 (83 percent) are reserved for public housing residents. The BHA rents the remainder to the general public at market rates.

These data are from the BHA’s 1993 HOPE VI application and from interviews with BHA staff members.

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Boston: Orchard Gardens (Formerly Orchard Park) The Orchard Park complex was located about 1 1/2 miles east of Mission Main, a few blocks from the once-thriving Dudley Square commercial center. Built in the 1940s, the property had been hit hard by the riots that followed the assassination of Martin Luther King, Jr. By the early 1990s, it was widely described as “God-awful,” and it was the second-worst property in the BHA’s portfolio.

Darrell “God” Whiting, a vicious drug dealer, effectively controlled the complex. Conditions were so bad that 89 percent of the individuals offered a chance to move off the BHA waiting list, which then included 15,000 households, and into Orchard Park chose to move to the end of the waiting list rather than accept the Orchard Park placement.6 BHA staff members noted that people preferred living in their cars to living in Orchard Park.

The Orchard Park Tenants Association had pressured the BHA for years to improve the complex, and the BHA finally began modernizing it in 1993. In 1996, the BHA received a $30 million HOPE VI grant for more comprehensive site redevelopment. The BHA kept the renovated buildings, but it demolished the rest and built new units in a series of garden-style apartments and rowhouses, renaming the property Orchard Gardens. The process involved decreasing the site’s population density by reducing the total number of units from 711 to 446. All the onsite units are rentals, with 85 percent reserved for public housing tenants and the remainder designated as market-rate apartments. An additional 45 homeownership units have been completed off site, a few blocks away. The redevelopment also involved the construction of an elementary school at the edge of the property.

Washington: The Townhomes on Capitol Hill (Formerly Ellen Wilson Dwellings) The Ellen Wilson Dwellings complex was built in 1941 on 5.3 acres on the southeast edge of the Capitol Hill neighborhood in Washington, D.C. The site contained 134 public housing units in two- and three-story, walkup apartment buildings that contrasted sharply with the neighborhood’s brick townhouses. Conditions on the site deteriorated over time, and, by the mid-1980s, the area was distinctly separate—visually and economically—from the surrounding Capitol Hill community. Conditions at the Ellen Wilson were so bad that Don Denton, a local realtor, considered its residents “really hostages … living in hell on earth.” The District of Columbia Department of Public and Assisted Housing (DPAH), the predecessor of DCHA, designated the Ellen Wilson Dwellings for comprehensive modernization in the late 1980s and relocated all the residents in 1988. The estimated renovation costs exceeded available funding, however, and the city was unable to convince congressional appropriators to allocate the additional funds. As a result, the Ellen Wilson sat vacant for 8 years, attracting prostitutes, drug dealers, and squatters. Street robberies, car thefts, and panhandling became commonplace in the area surrounding the site (Wheeler, 1998). Exacerbating the problem was the deterioration of the Arthur Capper public housing complex across the nearby Southwest Freeway; by the early 1990s, that complex was about 60 percent vacant and largely boarded up. The reconstitution of DPAH as DCHA (under a court-appointed receiver), coupled with a $25 million HOPE VI grant due to the intervention of then U.S. Housing and Urban Development (HUD) Secretary Henry Cisneros, finally resulted in the demolition of the Ellen Wilson Dwellings in 1996.

See the BHA’s HOPE VI application for Orchard Park.

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