September 2002
Affordable housing is the wrong way to revitalize Trenton
By
Dan Dodson
Rising
median income is the surest sign that a city is revitalizing,
but Trenton has lost ground over the last decade. According to
the 2000 Census, New Jersey's median household income has risen
4 percent over the last decade, to $54,226 when adjusted for inflation,
while Mercer County's has risen 6 percent, to $56,612. Meanwhile,
Trenton's median household income has actually decreased 6.7percent
when adjusted for inflation, to $31,074. That's right, decreased.
There
are only three ways this could have happened: One, Trentonians
haven't received pay increases; two, highly paid people have moved
away; or three, low-income families have moved into town. The
debate over housing won't affect salaries much, but it has everything
to do with immigration in and out of our city.
Affordable
housing is a popular cause because it's easy to want people to
have nice homes. Arguing against the cause elicits strong emotions
and breeds suspicion of racism and classism. The debate becomes
more difficult because the unintended consequences of subsidized
housing manifest themselves over long periods of time, which complicates
the ability of politicians and the press to respond. Finally,
workers in both governmental and non-governmental agencies who
are tied to the affordable housing industry create a powerful
lobby to which the public responds.
Real
public debate needs to progress beyond short-term benefits, no
matter how uncomfortable it may be.
Building
homes for people of low income sounds like a good idea. But if
it were such a great idea, why aren't our wealthy suburban neighbors
doing it instead of paying us to do it for them? Becoming Princeton's
poor neighbor isn't sustainable. One argument for affordable housing
subsidies is that working people need a place to live, and all
those jobs in Princeton and West Windsor would go unfilled without
affordable housing. That's true, but low-income housing also places
a burden on police, social services and schools and has a negative
impact on property values. Overburdening a city with low-income
neighborhoods drains the very social welfare systems meant to
support the poor (are you comfortable with the word poor? Or would
you prefer a more PC term?) . The "Mount Laurel money"
that rich towns pay for Trenton to develop housing doesn't cover
these social costs. It's a great deal for Princeton and a bad
deal for Trenton.
Average
is a great goal for Trenton
According
to eNeighborhoods.com, which provides quality-of-life information
to leading real estate brokers, Trenton's low income level ranks
it in the bottom nine percent of communities in New Jersey. Our
schools are in the bottom two percent and our crime is in the
bottom one percent. Students of N.J. policy know that crime and
school performance are highly correlated with a town's median
income, and not even increased school funding seems to make a
difference. The data for Hamilton, Princeton and Trenton show
this to be true.
Because
Trenton's ratables are lower than its neighbors, we are always
in the position of having to beg for more than our fair share
of state, federal and private funds. Even with these donations,
and the highest tax rate in the county, the city budget is always
under strain, our streets are littered and pot-holed and we're
closing firehouses.
If
our incomes and home values were average, Trenton would no longer
have these problems. With our history, charm and density, this
city would be a much better place to live than Hamilton.
Trenton
has an oversupply of low income housing
According
to the NJ Guide to Affordable Housing, Trenton has almost 6,000
publicly funded affordable housing units; Hamilton has 436 and
West Windsor, 161. According to the 2000 census, 89percent of
owner-occupied homes were valued at less than $100,000, 89 percent
of the residents who paid rent paid less than$1000 a month, and
11percent of monthly rental payments were under $200 a month.
Less than one percent of the homes in Trenton are valued at more
than $300,000.
Trenton's
median home value is only $65,500, well below the $120,000 median
national price and New Jersey's median of $171,988. Trenton is
a low-cost housing haven in the middle of the highest priced state
in the union. It is disingenuous to argue that Trenton has a shortage
of affordable housing when the evidence clearly points to the
contrary.
Downtowner
readers, who surely aced their college economics courses, know
that increasing the supply of a product pushes down prices and
stimulates demand. When a family moves into new affordable housing,
there is always another family ready to move into their old apartment.
Because Trenton has so many low-income housing units, it is a
very popular destination for low-income families who are moving
into central Jersey. We should be more worried about creating
a better community for the folks who already live here than attracting
low-income newcomers.
Low-cost housing is not a bad thing, and a healthy economy produces
all types of housing and even allows housing stock to change in
value over time. The damage is done when housing is restricted
to a certain income group.
Income
restrictions prevent housing units from gaining value if a neighborhood
improves. Therefore, the only direction that income-restricted
housing and the neighborhoods that surround it can go is down.
That's what has happened with public housing projects.
If
Trenton can find a way to move its median income up, then its
quality-of-life factors will improve as well. Since affordable
housing production moves income levels down, it has the opposite
effect.
Trenton
needs to be attractive to people with the money to build and renovate
expensive homes, spend money in our restaurants and support our
cultural organizations. More neighborhoods with homes in the $200,000
to $400,000 range will attract these middle class emigrants. A
manageable urban city like Trenton could be a very attractive
alternative to suburban sprawl, if only we provide a reason to
move here.
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Dan
Dodson is a management consultant and Leadership Trenton fellow.
He can be reached at dan@livingonthenet.com www.livingonthenet.com
