Family Care & Tax Breaks for Wealthy

Something I've been saying lately is that politics is about choices and how they show the person's priorities.

Latest case in example:

The Legislature froze funding for Family Care, allocating just $5 million for individuals in urgent need of long-term care.  This will serve only an additional 400 persons-even though the waiting list is over 9,000 for Family Care and IRIS.  This freeze is particularly foolish in light of the fact that it costs an average of $2,800 per month for Family Care while the average cost in a nursing home can cost $4,000!  More details on the need for, and benefits of, Family care in a report by the Survival Coalition of Wisconsin Disability Organizations, Keeping the Promise: Lifting the Cap on Long-Term Care in Wisconsin.

"Wisconsin is broke" insists the Governor and others in justifying budget cuts and other funding freezes.  In fact, when Wisconsin unexpectedly received a revised estimate of an additional $600 million (over three years) in revenues, the insistence was that the new revenue be used to pay off debt, such as restoring over $200 million to a medical malpractice fund that was illegally raided in 2007, as well as paying back Minnesota over $50 million.

Fine, fine, fine, we're broke.

Why, then, does AB 85 propose to give over $213 million during the 2011-2013 budget cycle to the wealthiest 1% of taxpayers?  AB 85 would restore tax breaks on capital gains such as investment income, sale of expensive assets like art, etc.  Homes are not included unless the profit is over $500,000 (that is, not the sale price, but the profit).

Now, let's go back to people in need of long-term care.  We're talking about people (including children) with severe disabilities, the elderly, etc. who need assistance with daily life-physical, mental, or medical.    If $5 million could fund 400 people, $10 million could fund 800, $100 million could fund 8,000, which a major chunk of the waiting list of 9,000. 

Based on simulations using the 2008 Individual Income Tax Model, the bill will reduce revenue by $118 million in fiscal year 2012, $113 million in fiscal year 2013, and $127 million annually beginning in fiscal year 2014.

Why, by not passing this tax break, we could serve most people who are on the waiting list to receive much-needed care!

You know what the insulting part is?  The Institute for Wisconsin's Future estimates that the average extra income for the super-wealthy would be just $5,400, and for middle-class households, it would be just $88. 

Are we really going to tell the parents of a child with severe disabilities that the child can't get the care that is needed just so some guy who sell stocks can pocket an extra $5,400?  Sure, to me, and probably to you, that's alot of money.  But to the top 1% of taxpayers?  Chump change.

Politics is choices, and those choices show priorities.

This Is What Planning Looks Like!

Kudos to former Mayor Daley and Chicago for thinking ahead and planning for climate change.  Take a look at the Chicago Climate Action Plan. 

Wouldn't it be great of Wisconsin communities thought about this sort of stuff?  If only there was some sort of entity that could assist with this kind of planning, perhaps even a regional one?  How about it, SEWRPC? But really, steps one would take in Racine should also, more or less, work in LaCrosse, so there's no reason why the state of Wisconsin and/or the various Regional Planning Commissions can't collaborate on a planning template that communities could use.

Better Answers Needed to Transit

The Brookings Institute, a "nonprofit public policy" institution, through its Metropolitan Policy Program, has published a study of transit and jobs in metropolitan areas of America. Missed Opportunity: Transit and Jobs in Metropolitan America examines data from 371 transit providers in 100 metropolitan areas and found that while transit coverage is highest in western metro areas and lowest in southern metro areas, there typically is a disconnection between where the poorest residents live and where the jobs are.

It notes that as metropolitan areas grow, employment opportunities are increasingly decentralized. 

Spatial mismatch and the costs of transportation. As economies and opportunity decentralize, a “spatial mismatch” has arisen between jobs and people in metropolitan America.  In some metro areas, inner-city workers are cut off from suburban labor market opportunities. In others, low- and moderate-income suburban residents spend large shares of their incomes owning and operating cars. While owning a car improves chances of employment, a growing body of work quantifies the large combined impact of housing and transportation costs on households’ economic bottom lines.

Looking at the tables and charts, Milwaukee metro area actually compares well to its peers in terms of median frequency (under 9.2 minutes), and is #8 at share of jobs reachable in 90 minutes which is 48.6%.  Yet it is in the middle of pack regarding share of working-age residents with access to transit, or between 57.7% to 67.4% of the working-age population. Milwaukee's combined ranking of access to transit and employment ranks it at #14, edging out Madison at #15.

In Wisconsin, for example, the state’s two major metro areas, Milwaukee and Madison, rank 14th and 15th on our combined score of transit coverage and job accessibility. The average neighborhood in these metros can reach 49 and 58 percent of the metro areas’ jobs, respectively, via transit. Both metro areas rank in the top 20 nationwide for the share of their commuters using public transportation. Yet the program cuts proposed statewide are expected to lead to increased fares and the reduction or elimination of certain transit services in these places. One analysis shows that the funding reductions to the Milwaukee County system alone would make 25,000 currently served jobs “inaccessible by transit” and would be directly burdensome to low-income workers. This would be on top of the estimated 40,000 jobs made inaccessible in that metro due to transit cuts from 2001 to 2007.

Yet  Milwaukee County Transit System's ridership is at a 35-year low, plunging 9% just in 2010.  Other suburban transit options also saw higher declines in their riderships.  Clearly, despite the metro area's relatively better transit coverage, it is not seeing the same increases that other metro areas are seeing. This is quite a change from the 1990's, when Milwaukee saw a 21.8% increase 1995-1999. Clearly MCTS has to make some changes to reverse this decline. 

Back to the Brookings study, it discusses two strategies for a better approach to transportation systems linking people to jobs.  Both approaches, unfortunately, requires a regional collaboration that has been lacking for a long time.  Until communities start working together, the Milwaukee metro area will continue to decline in ensuring its residents have access to jobs, and without that, there will continue to be a poverty problem.

Local Control & Ordinances

So glad to see that the sanctity of local control continues to be a priority. 

Analysis by the Legislative Reference Bureau

This bill prohibits a city, village, town, or county from enacting an ordinance that does any of the following with respect to a residential landlord: 1) prohibits or limits the landlord from obtaining or using various types of information about a tenant or prospective tenant, such as household income, occupation, court records, rental history, and credit information; 2) limits how far back in time a prospective tenant’s credit information, conviction record, or previous housing may be considered by the landlord; or 3) prohibits the landlord from showing a rental property to a prospective tenant, or from entering into a rental agreement for a rental property with a prospective tenant, while the current tenant is living there.

This is squarely aimed at ordinances such as Madison's limiting the degree that landlords can discriminate against a tenant because of his/her criminal background, and prevents other communities from adopting similar ordinances.  If you read Madison's ordinance, you'll see that landlords cannot refuse to rent to someone because of a minor offense years ago such as, say, being arrested smoking pot.  But if the offenses have a substantial relationship to the tenancy due to the frequency or the nature of the crimes, if there is reasonable cause to fear for the safety of the landlord and/or tenants, as well as the property, the landlord can still refuse to lease the unit to the person.  Keep in mind the landlord can also reject a prospective tenant for other legitimate reasons such as credit history, past evictions, etc.

The City of Appleton also has a similar ordinance.  Dane County, too.

There are already some limits on employment opportunities for ex-offenders, and allowing landords to discriminate willy-nilly against tenants for crimes years ago makes it harder for people to be rehabilated, to have a second chance.  The increasing marginalization of people leaving prison makes it more likely they'll live with friends & families off-lease, creating instability in their lives, increasing the chances they'll turn once more to crime.  Is that the policy that we should be going for?  Driving people "underground" as they can't find employment or housing? 

When you consider there are racial disparities in the prison population, as well as a high number of people with mental illness, this sort of policy has other implications as well.

Olga Village

It's too bad that cheap shoddy projects like this attract so many undesirables.  Imagine the horror if this was near you! (Sarcasm intended)

Seriously, though, I attended the groundbreaking of this building and, although I'm generally not a fan of segregated (elderly-only) buildings, this is a very nicely designed building, using both environmentally sustainable design and Universal Design.

Washington Post Follow Up

I commented on the Washington Post article on HUD's HOME program last week, and the National Housing Conference (NHC), a national non-profit organization focused on housing issues and advocacy, has also responded to the story on their blog, pointing to the overall success of HOME program.

NHC also provides some helpful graphs showing that the private industry, too, had slowdowns not only in housing starts, but also housing completions.  It provides helpful context.

I was reminded by NHC that the Washington Post article is part of a series of reports, including this puzzling one that does its best to imply something nefarious happened.

But I'm sensing a consistent trend in those stories-that the "government should've done something."  But it says nothing about the decades of cuts to staffing of HUD as well as the fiscal pressures often felt locally, which makes it difficult to hire and retain qualified staff to provide oversight. 

At no point does the articles say, "there is no need for affordable housing" which means that the collary is "there is a need for more administrative funding so HUD and local communities can provide adequate oversight."  Yet that does not seem to be what many people take away from those articles.  Despite the fact that the overwhelming majority of the HOME program is successful, people see those articles and say, "HUD can do nothing right, therefore we must defund this." 

Which makes those kinds of articles so infuriating because, yes, we want programs to be operated efficiently, yes, we want fraud and waste identified, but we also know that exposure of problems in the media will lead to calls for cuts and defunding rather than improved efficiency.

In an e-mail sent out, Ethan Handelman, the Vice President for Policy and Advocacy, mentions that there is a "hearing now scheduled for May 31 in front of the full House Financial Services Committee at which Mercedes Márquez, Assistant Secretary for Community Planning and Development is expected to testify." 

The legislative majority of the House has been hostile to many programs as they search for ways to cut spending.  You can bet the Washington Post reports put a big red bulls-eye on the HOME program.

Homes for Our Troops

The Waukesha Freeman has a story on a veteran receiving the keys to a new home built by Homes for Our Troops and many local volunteers.

I previously blogged on this with what was apparently a surly mood, although I stand by my words.  There shouldn't be a need for a completely new home to be built in order to provide accessibility.  Minor changes to today's building practices would make future accessibility revisions much less costly.

Washington Post "Expose" on HUD's HOME Program

The Washington Post has published an investigative report on HUD's HOME program which reveals some problems with oversight of the developments.

Nationwide, nearly 700 projects awarded $400 million have been idling for years, a Washington Post investigation found. Some have languished for a decade or longer even as much of the country struggles with record-high foreclosures and a dramatic loss of affordable housing.

You & Mortgage Disclosure Feedback

The Consumer Financial Protection Bureau (CFPB) is tasked with the duty of protecting American families from unethical lenders, banks, and other financial institutions.  The CFPB is currently working on an improved disclosure form for home mortgages.  You have an opportunity to provide feedback on which of the two forms work better.

I think it's a significant step in improving how American homebuyers understand what they are getting into.  Will this be the last step?  Of course not.  At the moment of closing, the average family has already made arrangements to leave the former residence into the new home, and very often feel trapped when there are unexpected changes or details.  They're hardly in a position to protest or simply walk away.  But at least with this, they'll have better information earlier.

Poverty is Not a Contagious Disease

I am a proponent of more integrated approaches to housing, believing that integrating people with disabilities is beneficial to them and to society as people get to live near their families, friends, etc. as well as having better outcomes. For instance, studies have shown that people with mental illness have better recovery and stability when integrated in the community. 

I also extend this belief of integration and inclusion to people with low income, regardless of disability status. Creating "ghettos" of concentrated low-income populations is never good policy.  This results in what is called concentrated poverty with additional problems.

I was pleased to read yesterday of a study that apparently came out last fall regarding the benefits of integrating low-income population into higher income areas, rather than deliberately using policies that exclude them such as zoning requirements.

The study in Montgomery County (MD) looked at two approaches taken by the county and the resulting educational impact on the children.  Montgomery County poured resources into some of the elementary schools in high-poverty areas, resulting in smaller classrooms, specialized instruction, etc. in an attempt to improve them.  But at the same time, Montgomery County also took advantage of the inclusionary zoning policies that were passed in 1970s to offer housing options for low-income families in higher-income neighborhoods.

The result?

• By the end of elementary school, students in public housing who attend more-affluent green zone schools through the inclusionary housing program cut the achievement gap with non-poor students in the district by one-half in math, and by by one-third in reading.

• Despite the district’s extra investments in its most disadvantaged (red zone) schools, by the end of elementary school, children living in public housing who attended lower poverty (green zone) schools far outperformed their public housing peers in red zone schools. The size of the effect from attending a low-poverty (green zone) school for children living in public housing in math was 0.4 compared with attending a higher-poverty (red zone) school. This low-poverty effect is quite large relative to other educational interventions, where research has often identified an effect of approximately 0.1 on student test scores.

• The educational benefits of socioeconomic integration are significant, but they take time. Only after four years in the district did public housing children in low-poverty schools notably outperform public housing children in the district’s moderate-poverty schools.

Now think about the metropolitan area in Milwaukee.  There is a stunning economic disparity as a short drive along North Avenue will bring you from some of the worst parts of the city to some of the best neighborhoods in the metropolitan area. There are numerous census tracts with very high poverty levels and a struggling school district located in the City of Milwaukee resulting from the economic and racial segregation in the metropolitan area.

From Washington Post:

"Today, 95 percent of education reform is about trying to make high-poverty schools work," said Richard Kahlenberg, senior fellow at the Century Foundation, a progressive think tank based in New York that published the report. "This research suggests there is a much more effective way to help close the achievement gap. And that is to give low-income students a chance to attend middle-class schools."

Ideally, there would be policies which allows families to more easily move into higher-income census tracts even as the high-poverty areas undergo some degree of gentrification as higher-income households move into the neighborhoods. 

We see the latter approach used by the City of Milwaukee and community development groups as part of an effort to revitalize neighborhoods, particularly with the use of tax credits to provide moderate income and mixed-income housing.

But it's the first part that is lacking.  There are zoning policies in many communities that make it difficult to create affordable housing, especially without some sort of assistance to the occupant or to the developer.  Neighbors banding together to fight proposed affordable housing developments.  Poverty is regarded as a contagious disease by many, subject to quarantine and isolation.

The region has to see poverty as a solvable problem.  But instead, there seems to be a state conspiracy to increase Milwaukee's woes and to take away tools that are available to the city.

Clean Safe Drinking Water

Clean Safe Drinking Water apparently is something in need of deregulation.

The Assembly has passed AB 23, which would, unless mandated by federal law, end a DNR requirement that municipal water systems be continuously disinfected.

Passed by an Assembly with short memories.  The Assembly rejected 21 Democratic amendments including those requiring disclosure.

...

More details in this JSOnline article, which also shares the sorta relevant fact that the clean water standards that this bill rejects aren't actually in place yet.

The Department of Natural Resources advanced regulations in 2009 that would have required municipalities to disinfect water by Dec. 1, 2013....A study by the Marshfield Clinic Foundation tested water in 14 communities between 2005 and 2007 and found that 34 of the 36 wells tested positive for viruses. None of the communities chlorinated their public water systems.

Also:  remember my post yesterday about the proposal by the Joint Finance Committee to reduce the state subsidy for sewer projects?  I said that it "might" lead to better zoning policies.  But in light of the following sentence from today's JSOnline article, perhaps not such a good idea to shift the cost to local municipalities.

Most of the communities in the study were in northern Wisconsin. Borchardt traced the likely sources of the viruses to leaking sanitary sewers. People who got sick tended to contract gastrointestinal illnesses.

Sewers & Housing Policies

Via The Political Environment, I see that the state is proposing to reduce the state subsidy of sewer projects in the clean water fund.  This brings up two issues I'd like to point to. 

Very often what a government unit calls cost-reducing or budget-cutting is really a matter of cost-shifting to a different party.  In this case, state "budget cuts" shifts the cost to local municipalities.

Wisconsin municipalities building sewers or expanding sewage treatment plants in the next two years would pay up to $59 million more in interest costs to repay loans through the state's clean water fund, under a proposal approved last week by the Legislature's budget committee.

This just might actually lead to better zoning and policies if communities try to limit the cost of new sewer pipes to new subdivisions.  Nearly a year ago, I commented on a study on actual costs of development which found that very often there are hidden costs (such as sewers and other services) to new subdivisions that municipalities may not realize exist.  With higher costs, municipalities might be taking a closer look at issues such as density and sprawl.

America's Foreclosure King accused of Fraud

When I read the Huffington Post article on Deutsche Bank, I remembered where I heard the name before.  Deutsche Bank is being accused of fraud by the U.S. government, of repeatedly lying to the Department of Housing and Urban Development (HUD) about the quality of Federal Housing Administration (FHA) mortgages.  HUD guarantees the FHA loans, but they have to meet certain conditions.  Which Deutsche Bank apparently lied about.  The U.S. is suing Deutsche Bank for at least $1 billion.  Yep, that's at least one billion dollars.

This is why self-regulation rarely work.

As part of the FHA program MortgageIT participated in, lenders are required to annually certify that they check basic records like borrowers' incomes, credit history and employment record. The lenders also are required to review loans that quickly default to guard against sloppy lending practices, and act in the government's best interests because taxpayers are bearing the risks for potentially poor loans

Deutsche did none of those things, according to the lawsuit.

As a result, "A third of those mortgages, or about 12,500, have since defaulted, leaving the government on the hook."

This leads to the context that I remembered Deutsche Bank from:

More than 40 members of Common Ground Wisconsin traveled to the Chicago Consulate May 18 with their request to open a dialog with the Germany-based bank. So far, Common Ground has been turned away by bank officials. Wells Fargo and U.S. Bank are meeting with Common Ground leaders to find solutions to Milwaukee’s foreclosure crisis.

Deutsche Bank is one of three banks Common Ground has been negotiating with that hold mortgages or are the trustees for more than 25 percent of foreclosed houses in Milwaukee. Wells Fargo and U.S. Bank are also meeting with Common Ground leaders to find solutions to Milwaukee’s foreclosure crisis.

For an idea of the impact that Deutsche Bank had on Milwaukee, and how it plays at home in Germany, go to this article translated from German.

Deutsche Bank’s tracks lead through the entire American real estate market. In Chicago, the bank foreclosed upon close to 600 large apartment buildings in 2009, more than any other bank in the city. In Cleveland, almost 5,000 houses foreclosed upon by Deutsche Bank were reported to authorities between 2002 and 2006. In many US cities, the complaints are beginning to pile up from homeowners who lost their properties as a result of a foreclosure action filed by Deutsche Bank. The German bank is berated on the Internet as “America’s Foreclosure King.”
----
A Victorian house on State Street, painted green with red trim, is now partially burned down. Because it can no longer be sold, Deutsche Bank has “donated” it to the City of Milwaukee, one of the Common Ground activists reports. As a result, the city incurs the costs of demolition, which amount to “at least $25,000.”

To their credit, Common Ground was able to persuade Deutsche Bank to meet with them and to promise to cooperate with efforts in the community, thought it took extraordinary efforts.  Fortunately, Wells Fargo and US Bank are much more involved in the community, and were much more willing to work with community leaders on the foreclosure crisis.

Transportation policies & Mayors

Two articles that provided for a jarring contrast.

The first, an article about how Governor Walker and the state is pushing for an upgrade in Hwy 41 from Milwaukee to Appleton, having it designated as a new interstate, similar to I-43 and I-94.

Getting the road up to minimal interstate standards in the coming years would cost $15 million to $20 million. That would involve widening shoulders and installing cable guardrails along some medians.

The second is a report about the U.S. Conference of Mayors, and a survey showing that many mayors feel that federal transportation dollars are not allocated in an equitable manner.

As the federal government sets priorities for long-term spending and deficit reduction, future transportation infrastructure investments should prioritize spending on pressing metropolitan transportation infrastructure needs as opposed to low-priority expansion projects such as the infamous Bridge to Nowhere. The long-term productivity of transportation infrastructure spending is greater when it is invested where economic growth will occur, and over the next 20 years, 94 percent of United States economic growth will occur in metropolitan areas

A mayor was particularly blunt about the issues affecting transportation dollars.  Mayor Reed of Atlanta had some strong words:
 

Mayor Reed said the disconnect between state and local governments is essentially a tension between the needs of rural and urban areas. “There is a dominance of the rural parts of the state that I think creates a bit of imbalance from the economic reality,” he said. He called it “old-school politics."
 
“I spent 11 years in the Georgia general assembly,” he said.”Anytime I needed to get an important bill I knew I would be in the car for a couple of hours going to see some chairman of a committee who was in Tallapoosa or Houston County or some other part of the state because there was a dominance there.”
 
“Now I like rural folks as much as anybody,” he went on, “but the fact of the matter is when you look at how our dollars are deployed at the state level they’re deployed in a fashion that is inconsistent with where jobs are and where the economy is created.” That was fine when the U.S. was the world’s incomparable economic superpower, but we need to be more thoughtful with our spending these days, he said.

In related news, the Regional Transit Authorities created in 2009 are in the process of being eliminated by the budget committee. 

The committee also voted to eliminate the state funding for bicycle and pedestrian paths.  And how does most mayors feel about those kind of decisions?

Three-fifths of mayors also said the lack of funding for bicycle and pedestrian projects was a problem.“These aren’t gimmicks anymore,” said Reed. “They’re part of a having a high quality of life in the cities where we live.”

Blog Changes

Regular readers may recall that this blog originally started as a blog of the Waukesha County Affordable Housing Taskforce, which later changed to the Affordable Housing Taskforce in Waukesha County.  Although housing issues are regularly discussed in this blog, there has not been much news on the Taskforce's activities.

Part of this is because the members of the taskforce have been involved in an introspective discussion of our activities and our mission.  While we will continue to advocate for a Housing Trust Fund in Waukesha County (see our very first post), we are evolving to advocate for better housing policies in Waukesha County. 

As part of the change in our mission, we are transitioning to a new name and a new website.  We are very excited about the change to Thrive Waukesha, and hope that you can be part of it. 

Our mission is to promote communities in Waukesha County that thrive because people are able to live and work in them.

And what will happen to Creating Communities?  For the moment, it'll continue as a housing issues blog, although no longer officially affiliated with Thrive Waukesha, and I'll certainly post updates here on what is happening with Thrive Waukesha.  In the long term,  Creating Communities may evolve into a blog about creating better communities through better policies, not just in housing, but also other areas as well, particularly disability-related issues.  I hope to recruit guest bloggers to discuss specific issues now and then.

Now go check out Thrive Waukesha!

NIMBYism in Hales Corner

I confess to being surprised to read of opposition to the proposed Applewood Senior Living Center given that neighbors usually consider elderly housing to be more desirable than other forms of multi-family housing.  I recall a public meeting in the City of Waukesha where neighbors opposed to a proposed development near the Goodwill building stated they would prefer to see a senior living building there.

Don't mistake me-I consider senior living apartments to be segregated housing and are opposed to them.

But this reminded me of two items I read recently- Matthew Ygelias writing about NIMBYism over solar panels on utility poles and Kevin Drum chiming in with a story of outraged residents being opposed to cellular transmitters atop light poles.

It was over in a neighborhood called Turtle Rock, which is one of Irvine's most upscale "villages" (yes, we really call them that). I got curious, and since it wasn't far away I drove over to take a look. And I looked and looked. Finally I found the offending light pole and looked some more. And there it was! I didn't see it at first, but sure enough, there was a small round doohickey attached to the pole about 20 feet up.

All I could do was shake my head. It was a light pole! And the transmitter was barely even visible. And it was 20 feet off the ground. How could anyone possibly care? But they did.

Sometimes people simply are opposed to change, period.

That doesn't mean there aren't legitimate concerns that could apply to some developments.  But the trick is to find the real issues among the hysteria.

Amtrak Over Time

Didn't realize May 1 was Amtrak's 40th Birthday.  Greater Greater Washington has a neat map showing the evolution, or rather, the devolution of Amtrak and passenger rail over time as roads and other modes of transportation rose (with massive government subsidies).

NLIHC's Out of Reach 2011

The National Low-Income Housing Coalition will be releasing their Out of Reach 2011 on Monday afternoon.  As some of you may know, NLIHC has released a study of housing costs around the country each year, with the most recent being Out of Reach 2010.

If you are interested in using Out of Reach to help you advocate on housing issues, Minnesota gives us some hints on how to do it effectively.

During the week, I'll be posting some data from the new Out of Reach.