The Wrong Way To Do Affordable Housing

Madison’s Plan Commission has approved 550 units of low-income housing in a redeveloping former industrial area.

That’s good. What’s not so good is that those 550 units are all low-income (no income diversity is allowed) and it’s concentrated in one tightly packed development.

There are also some brown fields issues involved because the site had been used to store coal for the old Oscar Mayer plant. Neighborhood residents and advocates are right to raise concerns about that and the DNR and city officials need to make sure that the area is safe before they allow construction to move forward.

But assuming that the environmental issues can be addressed, this is still a questionable proposal because of the concentration of low-income residents. Certainly the city needs workforce housing and 550 units (about 200 of which would be available for workers, the rest is for seniors) is a great start. My concern is just putting it all in one place.

All of this large complex proposed for an area around the old Oscar Mayer plant would be restricted to low-income residents.

Essentially, there are three ways to make housing more affordable. You can subsidize the construction, as is being done here, through tax breaks for developers or through direct public investment. Or you can subsidize renters through vouchers or other payments. Finally, you can just build a lot more housing and let supply and demand drive down prices. (There is a fourth way. Allow a city to deteriorate to the point where nobody wants to live there. Let’s not pursue that option.)

Of those options, I like the market solution the best. And, in fact, Madison has done a good job in recent years of reducing barriers and encouraging infill development all over the city. But the market is an imperfect tool and it can take a long time for supply to catch up with demand and to drive down prices. So, I understand the impulse for some kind of government intervention.

I like subsidizing renters better than developers because it gives renters choice on where to live and it increases chances of having mixed income neighborhoods. When you build hundreds of units of affordable housing in one tightly packed space and then restrict the incomes of those who live there (in this case to no more than 60% of county median income) you’re asking for trouble.

Concentrations of low-income housing on Allied Drive created all kinds of problems a decade and a half ago. We made things better in part by tearing down larger apartment buildings and building some market rate housing, including single family homes. Now, the city is experiencing some problems in the high-concentrations of low-income housing in the North Port Drive area.

Redeveloping the area around Oscar Mayer is a great thing. Building a lot more housing is a great thing. Providing workforce housing is a great thing — though I’d say that subsidizing developers to do it is the least attractive available strategy. But if we are going to create restricted low-income housing on the supply side, then it would be much better to do that as part of mixed-income developments.

Published by dave cieslewicz

Madison/Upper Peninsula based writer. Mayor of Madison, WI from 2003 to 2011.

2 thoughts on “The Wrong Way To Do Affordable Housing

  1. This piece is spot on Dave, though there actually there will be 303 units for families–including four-bedroom apartments in a seven-story building–and 250 for seniors in a sperate six-story building. Somehow city planners think that there will only be 710 people living those 303 units, one person per bedroom. I guess they don’t need to be realistic, they are “planners,” after all.

    By the way, the Oscar Mayer Special Area plan calls for a total of 4,000 housing units to be created in this small area, most of them affordable. I am not sure this kind of density exists anywhere else in the city, but now it is the plan for this once quiet, single-family modest residential neighborhood.

    The most surreal aspect of this plan is not just that concentrations of low income housing lead to bad outcomes as you wrote it’s the fact that Madison–and the entire country–has done this all before. Who in the world is doing the thinking around here nowadays? Idealistic liberals, I guess, who can’t be bothered by history.

    As you well know, Dave, inclusionary zoning was a local attempt during the tenure as mayor to spread affordable housing around the city by requiring some units to be affordable no matter where development happened. Developers hated it and the surprising feel good victory of creating the zoning by the city council, ended three years later when the zoning ordinance was sunsetted and only a handful of affordable units was created (because of the optout payment option, as I recall, and a significant decrease in proposals).

    While IZ may have worked elsewhere, Madison, as usual, proved to be exceptional. Most Madisonians like being “exceptional,” but I’m using it here in the way that is obvious to so many who move here and haven’t drunk the kool-aid: Madison is a wealthy, liberal city that has always flourished, it also has just about the worst economic, social and racial disparities in the county. That’s what I mean by “exceptional.” Madison will continue to be exceptional through housing decisions like this.

    Like

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