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2 + 2 = 21?
by David Stanowski
07 July 2011

Many people wonder how the GHA is able to ignore the demographics of the census tracts they plan to use in their rebuilding plan in clear violation of the mandate to deconcentrate low-income minorities, and to go a step further by identifying and utilizing census tracts that offer their residents the best opportunity to escape from a life of intergenerational dependency and poverty.
No one knows where their scattered sites may end up except for the fact that they have ruled out building anything on the West End, in the City's best census tracts, in clear violation of the Fair Housing Act. We can only wonder why the Mayor has not contacted the U.S. Attorney General to ask for his help in enforcing this law!

The real slight-of-hand that the GHA appears to be using to circumvent the proper site locations, based on key demographic criteria, is on display with their mixed-income developments which at the current time are slated to go on and around the old footprints of Cedar Terrace and Magnolia Homes.

It is far too complicated to consider the entire 14-point Communities of Opportunity scoring system, so this analysis will focus on only one of the most important factors from that system; the percentage of the population living below the poverty level.

In testimony before Congress on 05 May 2010 representatives from the Poverty & Race Research Action Council, the National Fair Housing Alliance, and the Lawyers Committee for Civil Rights Under Law made a strong case for the placement of Public Housing in census tracts with low concentrations of poverty.

They said that "the long-standing HUD definition of ..."low poverty" is less than 10% of the population in a census tract at or below the federal poverty line...

"To throw out the low poverty requirement because of the shortage of low poverty areas “within the jurisdiction” of many urban PHAs, as some have argued, would be precisely the wrong solution. The longstanding practice of PHAs to “take the path of least resistance” by siting new public housing in already poor neighborhoods is one of the major contributors to concentrated poverty in our cities – and one of the reasons that so much public housing is now so distressed that it is at risk of demolition."

The following table makes it very clear that GHA does indeed plan to build in "already poor neighborhoods".

How many census tracts in the City of Galveston can be rated as "low poverty", i.e. less than 10% of the population at or below the federal poverty line, and suitable for the placement of public housing?

Census Tract
(2000 Census)
% of Individuals
Below Poverty
(2000 Census)
see QT-P34
7241 18.9%
7242 18.1%
7244 24.9%
7245 39.4%
Cedar Terrace
7247 30.6%
7248 22.4%
7249 20.9%
7250 17.0%
7251 18.9%
7252 30.8%
7253 8.1%
7254 19.0%
7255 7.9%
7256 14.6%
7257 5.1%
7258 16.9%
7259 19.6%
7260 4.0%
7261 7.8%

Census tracts 7253, 7255, 7257, 7260, and 7261 meet HUD's definition of low-
poverty neighborhoods.

7253 and 7255 lie west of 43rd Street. 7257 lies between 69th and 81st Streets. 7260 and 7261 lie west of 99th Street.

How many Public Housing units does GHA plan to build in these five census tracts? 

They want to build most of their units in census tracts 7243 and 7246 with 31.5% and 63.9% of the individuals in those census tracts living below the poverty level respectively!

Maps of each census tract are available by clicking on the links in the table shown above.

Maps of the locations of each census tract within the City are shown below.
West End Census Tracts

So how can GHA possibly build in census tracts 7243 and 7246? They may be using a special kind of alchemy that they BELIEVE will allow the demographics of their large mixed-income developments to turn the existing demographics of the census tracts from lead into gold.

Let's see if this has any chance of working by using one simple example.

The 2000 Census showed 2,507 people living in census tract 7246, and 1,602  (63.9%) of them were living below the poverty level.

1,602 / 2,507 = 63.9% below poverty

Cedar Terrace had 136 Public Housing units in CT 7246 with about 2.5 people per unit, or 136 x 2.5 = 340 total residents.

Assume all 340 were living below the poverty level.

If Cedar Terrace is removed from the census tract, the new demographics are:
2,507 total people - 340 = 2,167
1,602 people below poverty - 340 = 1,262

1,262 / 2,167 = 58.2%  below poverty

Therefore, removing Cedar Terrace improved the demographics of CT 7246 from 63.9% below poverty to 58.2% below poverty; as should be expected.

Will the Alchemy make any real difference?

What happens when GHA builds a mixed-income development in CT 7246?

The number of Public Housing units that can be built in 7246 is limited to 136 x 50% = 68 units due to the 50% rule in CFR 941.202.

Building 68 Public Housing units means that 68 tax-credit units and 68 market-rate units will also be built under their 1/3 + 1/3 + 1/3 building plan. Total build = 68 + 68 + 68 = 204.

Assuming 2.5 people per unit, each segment will contain 68 x 2.5 = 170 people.

The income assumption most favorable to GHA would assign the 170 people in the Public Housing units to below the poverty line status, and the 170 people in the tax-credit units, and the 170 people in the market-rate units to above the poverty line status.

Starting with the demographics in CT 7246, with Cedar Terrace removed, and then adding in the assumed demographics for the mixed-income development makes the following transformation:

% of Individuals Below Poverty Level in 2000, including Cedar Terrace:
1,602 / 2,507 = 63.9%

% of Individuals Below Poverty Level in 2000, excluding Cedar Terrace:
1,262 / 2,167 = 58.2%

% of Individuals Below Poverty Level in 2000, excluding Cedar Terrace + the mixed-income development:
1,262+170 / 2,167+170+170 = 57.1%

Removing Cedar Terrace from CT 7246 and then building a mixed-income development in its place lowered the % of Individuals below the poverty level from 63.9% to 57.1%, HOWEVER, it is nowhere near the 10% target range!

This alchemy is acceptable if you live in a world where 2 + 2 = 21!

In the world of reality, the original demographics in CT 7246 showed 63.9% below the poverty level, the worst census tract in the City. A location where building Public Housing should never even be considered. Simply removing Cedar Terrace from CT 7246 improved the % below poverty 5.7% (63.9% to 58.2%).

Adding the proposed mixed-income development only "improved the demographics" by 1.1% (58.2% to 57.1%), and did NOT come anywhere close to transforming it into an acceptable location for Public Housing with less than 10% below poverty!

Clearly, the GHA Board is not dealing with the reality of the demographics of the City, and is not doing the necessary computations!

Learn Purchase Real Estate for Cents on the Dollar!

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