The federal Low Income Housing Tax Credit (LIHTC) program has reinforced poverty concentration and racial segregation in the New York City region, according to a recently released report by the Fair Housing Justice Center (FHJC). The report, Choice Constrained, Segregation Maintained: Using Federal Tax Credits to Provide Affordable Housing, examined more than 52,000 low income rental units produced under the LIHTC program over ten years (1998-2007) in the five boroughs of New York City and the surrounding seven counties. It found that LIHTC units were developed predominately in areas of high or extreme poverty and in minority neighborhoods, reducing options for eligible low income families.
According to the 2000 census (used throughout the FHJC analysis), the New York City region is one of the most racially diverse in the country although the suburbs are much more homogenous than New York City itself. FHJC found that although the New York metropolitan area is diverse, it is the third most segregated metropolitan area for African Americans and the second most segregated metropolitan area for Latinos and Asian Americans. In a 2007 report, FHJC found that low income non-Hispanic whites were far more likely to live in low poverty neighborhoods than low income African Americans and Latinos who were more likely to live in areas of high or extreme poverty concentration. The report also outlined the consequences of such concentration, including unequal access to employment and educational opportunities.
In this follow-up report, FHJC demonstrates that instead of lessening this segregation, LIHTC has largely reinforced it. Over three-quarters (77%) of LIHTC units developed were located in minority neighborhoods and only 8% of low income units were developed in areas with more than 80% non-Hispanic whites in the population. These findings held constant whether they involved rehabilitation or new construction of multi-family housing, but were amplified in the city where more than 88% of units were developed in minority areas. The suburbs seem more evenly dispersed but data suggest that this was largely because half of all low income housing units created in the predominately white suburban counties were reserved for elderly residents. On the other hand, only 34% of the LIHTC developments in these areas were for family units. Further, seven out of ten LIHTC housing units were found to be located in areas of either high or extreme poverty concentration, with more than half (52%) in areas of extreme poverty (defined as greater than 30% of the population living in poverty).
Based on these data, FHJC suggests that the New York State tax credit allocation agencies have failed in their duty to affirmatively further fair housing by limiting housing choice of eligible families to extremely poor and minority areas. FHJC found no evidence that the agencies were monitoring the extent of tax credits furthering segregation and poverty concentrations or took any steps to prevent this from happening.
The full report is available here: http://tinyurl.com/kb2z8p4