Tuesday, July 25, 2006

Instant gentrification? DEIS says no, statistics say yes

Would the Atlantic Yards project cause gentrification, also known as "indirect residential displacement"? The Draft Environmental Impact Statement (DEIS) issued last week by the Empire State Development Corporation says no, in part because of ongoing gentrification, because new housing units could relieve market pressure, and because most of the at-risk households would be more than a half-mile away.

Those arguments, however debatable, can't be dismissed. The fourth reason, however, doesn't pass the laugh test. The DEIS suggests that the new residents would be similar economically to current residents in the area. But it fails to point out that the cost of the new housing would ensure that most new households would have to earn above-average incomes.

So the numbers back up City Council Member Charles Barron, who has long criticized Atlantic Yards as "instant gentrification."

Looking at the document

Chapter 4 of the DEIS states:
Similarities between the proposed project housing mix and the housing mix currently present in the ¾-mile study area indicate that the socioeconomic profile of new households and existing households would be comparable.

However, the DEIS lists the median household income for that ¾-mile study area as $46,208, based on the 2000 census. A rise since then by ten percent would bring the median income to about $50,000.

People earning $50,000 would have a chance at only a fraction of the 6860 apartments planned for the project. A large majority, 4610 units, would be market-rate condos and rentals, likely geared to people earning six figures and more.

The 2250 affordable rentals would rent at 30 percent of a household's income. However, more than half of those units (Band 5, Band 4, and at least half of Band 3) would got to families earning more than $50,000. Some of the affordable units would be aimed at people earning over $100,000, more than double in income in the study area.

So 5735 units--4610 market-rate and at least 1125 affordable--would go to households earning over $50,000. That means that nearly 84 percent of the new households would not be so comparable with the surrounding area.

Statistical leaps

How did the DEIS reach such a wrongheaded conclusion? The writers of the DEIS first pointed out that the distribution of the rental units, as a percentage of the total units, would be similar to the distribution of rentals in the ¾-mile study area.

Then came a curious formulation:
The distribution of affordable and market rate rental units would also be similar on the proposed project site and in the ¾-mile study area. A housing unit is generally considered “affordable” if the household occupying it pays 30 percent or less of its income towards housing costs. As of the 2000 Census, approximately 59 percent of all renter households in the ¾-mile study area were spending less than 30 percent of their household income on housing costs. This is similar to the proportion of affordable units planned as part of the proposed project.

Yes, 50 percent of the project rental units would be affordable. But that doesn't mean they'd be affordable to the same group of people. If the median household income in the study area is $50,000, current affordable rents are much lower than the affordable rents that Atlantic Yards renters would pay.

The segment concludes:
In tenure, affordability, and apartment size, the housing stock introduced by the proposed project would be similar to the housing stock in the broader ¾-mile study area. This indicates that the socioeconomic characteristics of the new population (e.g., in household income and household size) would be similar to the characteristics of the population living in the broader ¾-mile study area. Therefore, while the proposed project would introduce a substantial new population, that population would not be markedly different in its socioeconomic profile than the existing population, which would eliminate one of the underlying conditions for indirect residential displacement. (Emphasis added)

There's no evidence that the household income would be similar. By ignoring the actual income figures and relying improperly on affordability as a proxy for income, the DEIS avoids confronting "indirect residential displacement."

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