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Rising rents & displacement: The need for affordable housing in Grand Rapids

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Patty Eilers, resident of the Southeast community of Grand Rapids

Residents in the city's' southeast neighborhood are facing displacement from communities they have long been a part of due to the increasing costs of housing. Here, residents, grassroots organizers, and city leaders are working together to find solutions to the housing crisis happening in Grand Rapids.
Five years ago, Patty Eilers packed her family’s belongings and headed five miles south of Wyoming to the southeast neighborhood of Grand Rapids. The sole income provider of her family, Eilers was looking for more affordable housing and a home with a backyard for her seven-year-old nephew, who was also living with Eilers at the time.
 
With good credit and no previous history of evictions, Eilers still had a challenging time finding housing in the southeast neighborhood. After various persistent phone calls, applications, fees, and interviews, Eilers was accepted as the renter of a three bedroom home on Oakdale Street SE through the Grand Rapids Housing Commission of Grand Rapids (GRHC). The GRHC is an agency established by the Grand Rapids City Commission to administer Section 8 Housing Choice Vouchers and other federally subsidized housing programs for residents.
 
“They wanted to rent to somebody who was going to bring the neighborhood up, and I committed to investing here when I signed my lease,” says Eilers.
 
At the time, Eilers was working a full-time job and could afford the $875 rent. However, two years ago she lost her job and her rent was adjusted to $460. Since then, Eilers has kept up with the payments and found a new full-time job as a medical assistant in the city of Grand Rapids. About a month ago, Eilers was informed her rent would be increasing in less than 30 days to $1,025, an amount she is unable to afford.
 
“I am concerned about how I am going to be able to keep up with an over 200 percent increase in my rent,” explains Eilers.
 
Carlos Sanchez, executive director from the Grand Rapids Housing Commission, was unable to comment on Eilers’ case due to HIPPA regulations on confidentiality and privacy. Per Sanchez, the Grand Rapids Housing Commission has received funds from the U.S. Department of Housing and Urban Development to purchase a number of homes in the city of Grand Rapids. As property manager, the agency seeks to connect individuals who are low income to resources and affordable housing. The amount of rent an individual is charged is based on the individual’s income.
 
“Once an individual’s income has been verified to have increased, the rent would go up the following month,” says Sanchez.
 
Eilers, who initially had qualified for the GRHC’s rent-to-own program, has also been told by the Grand Rapids Housing Commission that, for now, her rent will not go towards the purchasing of the property, as these sites have been put on hold.
 
“There are 21 units we are putting on hold, and we are working on some programs, making it so we can’t sell them at this point,” shares Sanchez.
 
Eilers, along with many other residents in Kent County, are facing rising rents without a significant increase of wages, making it increasingly difficult to afford housing in neighborhoods they have come to know as their home.
 
According to the National Low Income Housing Coalition (NLIHC), an individual must make at least $20.98 per hour working a full-time job to afford a three-bedroom apartment at market rate in the Grand Rapids area -- far more than Michigan’s $8.50 minimum wage. An individual would also have to make more than minimum wage in order to afford a one-bedroom unit; the NLIHC reports one would need to earn a little more than $12 an hour. A Grand Rapidian earning minimum wage would have to work 99 hours a week to afford a three-bedroom unit, or 57 hours a week to pay for a one-bedroom apartment, according to the same coalition.
 
Since securing a full-time job, Eilers no longer qualifies as a low-income resident, but continues to find it difficult to pay $1,025 per month, an amount close to Kent County’s fair market rate for a three-bedroom apartment at $1,091 per month. For those making minimum wage in Michigan, an affordable monthly rent in the greater Grand Rapids area would be $442, according to the National Low Income Housing Coalition’s Michigan report.
 
Audrey McIntosh“We are hearing about rising rents, displacement and people who are becoming transient,” explains Audrey McIntosh, the Development Without Displacement Group Facilitator for Grand Rapids Homes for All (GRHA). A group of advocates, residents and community leaders, GRHA is working to ensure quality and affordable housing is equitably accessible for all Grand Rapids citizens.
 
The group was formed through a partnership with the Kent County Health Department, but in the last year has evolved into a grassroots organization working with and empowering residents to advocate for change. Currently, the group has no funding, but through various nonprofit partnerships, including one with Healthy Homes Coalition, the organization has gained momentum in the community.
 
One of the ways the group is advocating for change is with tax abatements at the City Commission level. In the city of Grand Rapids, developers have opportunities to receive a maximum of 15 years of tax abatement through the Neighborhood Enterprise Zone Program, established by the Public Act 147 of 1992.
 
The program allows for a reduction of taxes lasting up to 15 years for the developer if they include a plan to also revitalize, rehabilitate or develop a new facility to improve the neighborhood in which they’re developing.
 
“Options to help improve the neighborhood can include building a bus stop, parking issues, making environmentally friendly changes,” explains McIntosh.
 
To use this program to benefit an increase in affordable housing for families, Grand Rapids Homes for All is asking the City Commission to revise the program and only grant the maximum amount of 15 years of tax abatements to developers who are choosing to provide affordable housing options with their projects.
 
“Giving developers the incentive of 15 years for providing affordable housing allows us to address the problem in a long-term manner,” shares McIntosh.
 
Those developers who do not include options for affordable housing in their plans would not receive the full tax abatement benefits, but could still qualify for a tax abatement of up to 10 years, according to the Grand Rapids Homes for All’s proposal.
 
In the United States, close to 15 percent of renters are paying more than half of their income for housing, which is significantly higher than the 30 percent financial experts usually cite as a sustainable number, according to a study from the Enterprise Community Partners and the Harvard Joint Center for Housing Studies. That increases dramatically in Grand Rapids, where about 33 percent of renters spend at least half of their income on rent, according to Make Room, a national campaign that aims to give voice to renters.  A family in the greater Grand Rapids area needs to make at least $31,040 dollars to pay for a two bedroom home, according to the National Low Income Housing Coalition.
 
Ways other cities have attempted to ensure low-income residents are not forced to invest more than half their income on housing is through rent control. In New York City, rent control limits landlords from raising the rent to market rate for renters who have lived at the rental continuously since before July 1, 1971. Rent control can allow residents who have been living in a neighborhood to be able to remain without the financial stresses of rent increases. In addition to rent controlled units, there are the more prevalent rent stabilized apartments, where landlords are only allowed to raise rent by a certain percentage (which, in 2016 to 2017 was 0 percent for one-year leases and 2 percent for two-year leases).
 
However, in the state of Michigan, local governments are not allowed to pass ordinances or legislation imposing a rent control on housing units. This prohibition applies to the city of Grand Rapids, which, according to Suzanne Schulz, Planning Department Director for the city, has one of the tightest housing markets in the country. The city’s vacancy rate for rental properties hovers around 5.1 percent, according to Dr. Paul Isely, Associate Dean of Undergraduate Programs and Economics Professor at Grand Valley State University.  Isely’s data analysis comes from the 2015 U.S. Census numbers.
 Dr. Paul Isely
“The low vacancy rate has been placing upward pressure on prices, particularly in a few areas near downtown Grand Rapids; however, as a whole MSA  (Metropolitan Statistical Area) this increase has been mirroring the increases seen nationwide.  Based on the large increase in multifamily permits in the Grand Rapids MSA it is projected that the vacancy rate will continue to trend toward the 7 percent number over the year as the growth in new rentals is exceeding the growth rates seen in jobs,” says Isely.
 
In light of this, the city of Grand Rapids is working on four strategies to address the lack of affordable housing: housing programs for low-income individuals that are easily accessible, incentives for developers, zoning changes to develop underdeveloped lots, and creating housing trust funds to improve affordability within certain neighborhoods.
 
“Housing programs already in place are low-hanging fruit that we can resource Suzanne Shulzmore, and build the program up to help reach more people,” says Schulz.
 
As part of the city’s push to provide incentives for developers to build affordable housing, Grand Rapids is aiming for policies that would allow developers to increase building density if they commit to affordable housing.
 
“Minority populations in Grand Rapids are disproportionately affected by the lack of affordable housing. The choices that have been made historically have affected people of color inequitably,” says Schulz.
 
As the number of college students rises in the city of Grand Rapids, landlords have to more opportunities to rent their property to a group of college students who are more likely to be able to afford the rents on the rise in Grand Rapids, as opposed to a family surviving on one income.
 
“If you are a landlord, and you can rent to four people, then you have four people who can pay rent versus one family who can pay rent. The amount of money you can expect on a rate of return on a house could be higher, and that might impact families,” states Schulz.
 
The city of Grand Rapids does not allow more than four unrelated adults to reside in a property as a way to help prevent an increase in rents. If the ordinance were to change and allow more than four unrelated adults to reside together this would decrease the cost for a single individual. For organizations like Well House, which is providing affordable housing by renting out rooms within a single home, this ordinance could open up rooms for rent for more individuals.
 
According to Schulz, addressing the lack of affordable housing in Grand Rapids means a closer look at the property ownership patterns and who manages properties for rent in the city.
 
“The rental market has changed dramatically. Properties are now owned and managed by only a handful of people, corporations, and companies,” says Schulz.
 
For Schulz, a key solution to the lack of affordable housing is through education and awareness. By making tenants aware of their rights and the avenues they need to go through to address these allows residents to be empowered and hold landlords accountable.
 
The next community meeting for Grand Rapids Homes for All will be on Friday, March 17th  at Baxter Community Center (935 Baxter St. SE) from 5:30 to 7:00pm. This meeting will be part of the continuing dialogue to ensure all citizens in Grand Rapids have equitable access to housing. For those interested in becoming more involved with the group contact the organization at 616-929-0075.
 
On The Ground GR
 
On The Ground GR is a Rapid Growth series. This series will highlight and celebrate the communities found touching along the southeast end between Wealthy Street, Cottage Grove, 131 and Madison Square.
 
Over the next few months, On The Ground GR journalists will be knocking on doors and getting to know the neighbors and community members. We will dive deeper into topics concerning this neighborhood's residents and stakeholders while celebrating the diversity and strength found in this area. We are on the ground listening and want to celebrate the community's unifying spirit of positivity and vibrancy.
 
You can follow On The Ground GR's work via Twitter (#OnTheGroundGR @rapidgrowthmedia), Facebook and Instagram. To connect with On The Ground GR's editor, Michelle Jokisch Polo (read more about Michelle here), you can email her at michellejokisch@gmail.com and follow her on Facebook and Instagram.
 
On The Ground GR is made possible by the W.K. Kellogg Foundation, an organization working to guarantee livability of all children.
Photography by Dreams by Bella.
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