Since 1978, HUD has resisted Joliet, Illinois’ attempts to eliminate the affordable housing at Evergreen Terrace, which became a project-based Section 8 development in 1983. Currently, Evergreen Terrace’s 365 units are home to 764 people, 95.6% of whom are African-American. Two years ago a tenant filed a discrimination complaint with HUD, alleging that the city’s action to take Evergreen Terrace by eminent domain constitutes discrimination on the basis of race.
HUD then referred the complaint to the U.S. Department of Justice (DOJ), which filed a lawsuit on August 4, 2011 alleging that Joliet has failed to affirmatively further fair housing and has violated the Fair Housing Act and the Housing and Community Development Act.
HUD rejected Joliet’s 1978 proposal to redevelop the property into a mix of market rate and moderately subsidized units because the city could not demonstrate that there were a sufficient number of affordable replacement units elsewhere. In 2002, Joliet opposed Evergreen Terrace’s owner’s application to HUD for Mark-to-Market restructuring and instead urged its elimination, claiming it was a blight on the community.
In order to consider Mark-to-Market restructuring, HUD needed an assessment of the development’s physical condition from the Illinois Housing Development Authority (IHDA), its Participating Administrative Entity (PAE). IHDA determined that the Evergreen Terrace apartments were sound and adequately maintained. In 2004 a different PAE undertook another physical assessment and set forth a $957,000 rehabilitation plan to be completed within a year of closing under Mark-to-Market. In 2006 HUD’s Inspector General concluded that the previous physical condition assessment was accurate.
In addition to an assessment of physical condition, the 2002 application for Mark-to-Market restructuring triggered a Rental Assistance Assessment Plan (RAAP). IHDA concluded that there was a strong need for affordable housing and that if Evergreen Terrace was not preserved, displaced families would not be able to find housing in or near Joliet. At that time, public housing was fully occupied and the overall occupancy rate of affordable market-rate housing was 98%, making it difficult to use Housing Choice Vouchers anywhere in or near Joliet as a replacement for Evergreen Terrace’s 365 affordable apartments.
Reinforcing the lack of affordable housing, a later supplemental report from IDHA indicated that landlords resisted accepting vouchers. The Housing Authority of Joliet had sent 1,000 letters to landlords seeking rentals for 88 families; after five months only half of the families were able to secure apartments. In 2005, the new PAE undertook a new RAAP analysis. It identified 790 vacant units within a 15-mile radius, but only five landlords with a total of 39 vacant units willing to accept Housing Choice Vouchers. HUD’s Inspector General concluded in 2006 that displaced tenants would have serious difficulty finding comparable housing within a reasonable distance.
Although the Mayor and other city officials opposed restructuring, HUD approved it in May 2003. Joliet continued its assertion that Evergreen Terrace was in poor condition and asked HUD to delay restructuring and consider an alternate plan, to which HUD agreed. However, Joliet’s two alternate plans were rejected by HUD because they primarily relied on relocating residents by using vouchers.
In 2005 HUD gave final approval for restructuring with a 30-year use restriction to keep apartments affordable. This prompted Joliet to declare Evergreen Terrace a public nuisance and a blighted area, sue to condemn the property, and prepare to take it through eminent domain.
DOJ is seeking a court order prohibiting alleged discrimination, stating that the effect of the city’s actions and proposed actions is “to limit or reduce the number of Black or African-American residents residing within the City of Joliet. Such actions, if carried out, would have a disproportionate adverse impact on African-Americans and operate to perpetuate segregation in Joliet.” The lawsuit also seeks a court order that would enjoin the city from proceeding with the condemnation of Evergreen Terrace without ensuring that there will be sufficient and adequate affordable housing.
A DOJ media release can be found at http://www.justice.gov/opa/pr/2011/August/11-crt-1014.html and the DOJ complaint at http://nlihc.org/doc/DOJ_Joliet_Complaint.pdf