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Housing Project in Oakland Fails to Start

According to the San Francisco Chronicle, a long-standing attempt to build affordable public housing near the Coliseum BART station in East Oakland is all but dead. Beginning in 2003, the plan was to turn a large parking lot near the light rail station into a housing village with shops. It was supposed to house 10,000 square feet of retail space and hundreds of apartments. The most recent projections brought the plan down to 1,00 square feet of retail and only 110 apartments.

The problem stems from the failure and collapse of the non-profit group originally founded to move the project forward. Called the Oakland Economic Development Corp. (OEDC), the group was given a $400,000 grant as recently as 2013. There was no interest and they had 55 years to pay it back, which they didn’t have to start doing until the housing project started to turn a profit.

Before that grant though, the project was little more than an idea, and since then, the OEDC has not only spent all the money with nothing to show for it, but has also lost their non-profit status after failing to file taxes for three years straight.

In addition, the city received an $8.5 million dollar grant from California to get the project built, but if it isn’t done by 2017, they lose that money. And, because it came from a millage that expires soon, they can’t transfer that money to other projects.

Oakland is missing out on a huge project, which could have given hundreds of families new, affordable homes, and boosted the local economy, because of oversight and poor planning. The OEDC didn’t keep up their end of the bargain, and now the city is almost half a million dollars poorer for it.

Non-profit ventures, like OEDC was supposed to be, can be valuable, and they can do good work. But like any kind of business venture, they can also be utter failures. Most likely, the space this project would have occupied will end up being parceled off to out-of-state investors.

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Sequester Still Punishes the Poor

poor child
IMG: via Shutterstock

The failure of Congress to pass a budget is being felt by the poorest Americans, as cuts to subsidized housing groups continue.  The Budget Control Act, commonly known as the sequester, has slashed a trillion dollars in federal funding to public programs across the board.  The New York City Housing Authority, (NYCHA), the nation’s largest public housing authority, announced that over 200 million dollars in funding have been lost since the sequester took effect on March 1st.  Overall, as many as 150,000 households that rely on vouchers to pay rent could be affected by the cuts.  Most housing authorities are dealing with the cuts through canceling new vouchers that were due to be issued this summer.  Other units may have to raise rent or default on mortgages.

John Rhea said in a press release that the mandatory cuts “severely hinder” the work of the housing authority.  The NYCHA chairman continued by assuring residents the commitment to maintain their developments and meet the goals to eliminate the backlog of repair requests this year.  Other ways the organization is dealing with budget cuts have included lay-offs, a hiring freeze and possible furloughs.  The plan to issue 5,000 new vouchers had to be canceled.

The voucher program for subsidized housing began with programs created by the Department of Housing and Urban Development during President Nixon’s term.  This is the first time the program has experienced any significant cuts.  The vouchers make it possible for low income households, especially seniors or those who are disabled, to be able to afford private rental housing.  If the vouchers are lost, it is possible many will lose their apartments and become homeless or institutionalized.  Some building owners rely on the vouchers to keep their building running, and some landlords also worry about defaulting on their loans.  This could put thousands of people on the streets and threaten the safety and health of not only New York, but cities across the country.