Category Archives: Economy

A new phase for an old steel community

The section of the south lakefront once occupied by U.S. Steel’s South Works is larger than the Loop — and it’s been empty since the steel mills shut down 25 years ago.

On WBEZ, Kari Lydersen looks at prospects for a proposed redevelopment, including 13,000 units of upscale housing, shopping, and a research park and charter school.  And she talks with local residents who wonder whether they’ll have a role in the new South Chicago, or whether they’ll be pushed out.

In a companion piece, Lydersen looks at a thriving Latino art scene on the Southeast Side, which the local chamber of commerce hopes will contribute to the area’s revitalization.

The radio debut of veteran print journalist Lydersen was catalyzed by the Local Reporting Initiative of the Chicago Community Trust, which connected her with producer Bill Healy.

TIFs increase inequality, reinforce blight

Increased attention on “policies that increase economic inequality” has meant greater public concern over the city’s TIF program, which residents see “helping the prosperous downtown at the expense of their neighborhoods,” according to a new report from Grassroots Collaborative.

A program intended to help low-income “blighted” areas has seen 55 percent of its spending from 2004 to 2008 going to the Loop and Near South, writes Eric Tellez.  That’s despite the fact that average incomes in the Loop ($62,000 to $77,000 a year) are much higher than in neighborhoods like Brighton Park ($21,000 to $27,000).

A Grassroots Collaborative analysis showed that while TIF subsidies created thousands of downtown jobs over recent years, they created zero jobs in Brighton Park.  Indeed, from 2002 to 2009, Brighton Park’s share of downtown jobs decreased by nearly 15 percent.

(Earlier this year the Chicago Reporter found that much of downtown TIF spending was actually creating jobs for suburban residents.)

Thus “a program meant to address blight in fact reinforces it,” Tellez reports.

A posting of the article at Progress Illinois includes data tables and interviews with two residents of Brighton Park (it’s also been published in the Back of the Yards newspaper, The Gate; the article breaks out data on Back of the Yards, Brighton Park, and Englewood).

David Uriostegui, a young Brighton Park resident who works three minimum-wage jobs to support his family, talks about getting home at midnight and getting up at 5 a.m. – and still worrying every day about how he’s going to cover his family’s expenses.  “I hate having to have a calculator in my head every day, trying to see if I’m going to have enough.”

Rosalba Guzman talks about the need to taxpayer subsidies to come back to communities.  She describes a downward spiral, with businesses closing because their customers are losing jobs.  Taxpayer money “should come back to the community, not to the corporates, because they’re making their own money,” she says.

Youth unemployment and violence

Does youth unemployment lead to violence?  Charles Jefferson, a journalism student at Columbia College and member of the youth advisory board of the Illinois Violence Prevention Authority, talks to staff members at Street-Level Youth Media who believe it does.

In a new article at North Lawndale Community News – part of a series on youth violence issues coordinated by the Illinois African American Coalition for Prevention – Jefferson surveys neighborhood and global youth unemployment levels as well as state and federal efforts to address the problem.

And he identifies one new reason for higher levels of youth unemployment: adults taking jobs traditionally held by teens.

A look at poverty on the West Side

Poverty rates in Chicago are nearly twice the statewide rate – and in Lawndale they’re more than three times the state average.  That’s one revelation from a multimedia investigation of the impact of poverty on the West Side by the North Lawndale Community News.  The series talks to experts, examines nonprofits working on the problem, and tells the stories of individual struggles.

Poverty in North Lawndale is now estimated at 42 percent, and unemployment has doubled there in the past decade, from 13 to 26 percent, says community development consultant Valerie F. Leonard in an interview with Nicholas Short.

Leonard worked on a 2005 survey of community organizations in North Lawndale that identified 325 organizations, 40 percent of which provide youth, family, or job services.  After learning that an estimated 80,000 Chicagoans are eligible for public benefits but don’t access them, she developed a guide to community resources.

Algernon Austin of the Economic Policy Institute tells Short that the U.S. has the highest poverty rate of any developed nation.  “And it’s not that these other countries…are richer than we are, it’s that they devote more of their resources to fighting poverty,” Austin says.  He emphasizes the need for more economic stimulus from the federal government, particularly on job creation and assistance to states and localities.

Research by the Center for American Progress shows that higher poverty levels are a drag on the nation’s economy, with lost workforce productivity and increased public expenditures due to poor health and high crime rates, Short reports.  Economist Mark Witte of Northwestern University explains that higher poverty levels add to the lack of demand that is stifling the economic recovery.

Nonprofits respond

West Side organizations are doing what they can.  Tali Bahkit reports on PEP-U, a job readiness program for juvenile offenders created five years ago by “concerned probation officers who wanted to make a difference.”

La Risa Lynch reports on West Side groups that were funded by a federal anti-violence program two years ago – and have continued the work despite the dollars drying up.  “In communities like ours, resources are few and far between, but challenges are always present,” says Tracie Worthy, director of the New Communities Program at Lawndale Christian Development Corporation.  LCDC has found new resources to expand its Hoops in the Hood program.

A community arts center located in the old firehouse which is also home to Tha House Hip Hop Church is continuing its youth video production program.  “You’ve got to find something that competes with the streets,” says Pastor Phil Jackson.  He’s hoping that local movie theaters will add to their preview lineups a short youth-produced video addressing negative stereotypes of urban youth.

And the Lawndale Amachi Mentoring Program is continuing its program hiring youth to do beautification projects – designed to build self-worth and community pride along with job experience for young people.  The organization mentors children whose parents are in the criminal justice system, and Dr.Betty Green says many suffer emotional trauma and anger which makes school more difficult for them.

Bill’s story

Nicholas Short and Guillermo Martinez tell the story of Bill, a 41-year-old former tatoo artist who’s lived on the streets for ten years after 15 years in prison.  His teeth are “falling apart,” he has Hepatitis B and C and sores on his body, he’s not allowed in restaurants or stores, and he says he’s used an indoor bathroom once in the past two weeks and had one shower this year.

But he’s “a gentle giant” who blames no one but himself for his situation.

Bill has tried repeatedly to break his drug habit, and discusses the difficulties of getting help:  he recently got a copy of his birth certificate and now needs a Social Security card so he can get a state ID – “You need ID to get an ID,” he says – with the goal of getting into an inpatient drug program.

His girlfriend and the mother of his son once ran the streets with him, but she managed to get clean and now manages a restaurant.  “I want to be a dad again,” Bill says.

Tali Bahkit talks with Donald Dukes, a 52-year-old man who’s survived a history of drugs and prison and now struggles to build a new life providing for his family.  He’s frustrated over the lack of support from – and the difficulty communicating with – elected officials who represent the community.

Bahkit also talks to young people who are stopped by the police, handcuffed and thoroughly searched simply because they walk past an area designated as a “hot spot.”  A young mother tells him this happens every day:  “They handcuff any African American male who walks in the neighborhood, without probable cause, and they totally violate these young people by checking them from head to toe.”

Young people are psychologically harmed an “feel as if the police are there to hurt them,” Bahkit comments.  And he asks whether police are acting as part of a system that is trying to remove black people from the West Side in order to make room for development.

West Side left out of city foreclosure program

Last week Mayor Emanuel announced a $20 million program to rehab and reoccupy foreclosed homes in nine neighborhoods.  At AustinTalks, Otis Monroe points out that Austin and North Lawndale aren’t part of it – traditionally “left-out communities” that have been left out again.

Indeed, not a single West Side community is included in the program.

In Austin, the same day the city program was announced, South Austin Coalition was releasing a report calling on banks to fix the housing crisis and the related economic collapse by writing down underwater mortgages to market value (see Newstips).  That would free up $70 billion a year in consumer spending, creating a million jobs a year, according to the New Bottom Line Campaign.

Yesterday a New York Times editorial backed up the report’s contentions:  “The economy will not recover until housing recovers — and that won’t happen without a robust effort to curb foreclosures by modifying troubled mortgage loans.

Instead of pushing the banks to do what is needed, the Obama administration has basically urged them to do their best to help, mainly by reducing interest rates for troubled borrowers…

Reducing principal is a better solution than lowering interest rates, because it reduces payments and restores equity. Bankers resist, because it could force them to recognize losses they would prefer to delay. The administration has resisted, in part because principal reductions are seen as rewarding reckless borrowers.

But many of today’s troubled borrowers were not reckless. Rather, they are collateral damage in a bust that has wiped out equity and hammered jobs, turning what were reasonable debt levels into unbearable burdens.

The Times urges action by regulators and by Fannie Mae and Freddie Mac to ease the rewriting of underwater mortgages.  The paper calls on President Obama to include “strong support for principal reductions and easier refinancings” in a forthcoming announcement on jobs — otherwise he “will not get at the root of the problem.”

SAC and NBL don’t focus on government; they argue it’s up to banks to rewrite mortgages – and they owe it to us, having received trillions in bailouts and backstops.  And right now they’re sitting on unprecedented cash reserves.

SAC chose a foreclosed home in Austin now being rehabbed by the Westside Health Authority in the first phase of a $2.4 million community restoration fund, won from U.S. Bank by the Coalition to Save Community Banking after the takeover of Park National Bank.

That shows that communities can pressure banks to step up and take responsibility – though it will take a lot more pressure to get banks to take full responsibility for their role in the collapse, especially with a political establishment that treats banks with kid gloves.

In any case, it shows that community groups on the West Side are acting to save their neighborhoods from the ravages of foreclosure, in the face of historic neglect – and that they merit more attention from the mayor.

Hearing on youth unemployment

Jarrett Norwood, 18, is volunteering at Ashunti Community Resource Center since funding for his summer job dried up – and he’s afraid he won’t be able to pay the fees for community college this fall.  “I can’t really afford to work for free,” he said.

Norwood was among hundreds of West Side residents at a hearing on jobs held by State Representative LaShawn Ford, AustinTalks reports.

“We see that the system is failing,” said Ashunti CEO Regina Lewis. “A lot of our kids have given up. They don’t believe in the system, period.”  More here.

TIF hearing in Bronzeville

Bronzeville residents turned out in impressive numbers for last Thursday’s public hearing of the Mayor’s Task Force on TIF Reform, and they had lots of ideas — from Housing Bronzeville‘s proposal to develop affordable housing on city-owned vacant lots to Urban Juncture‘s suggestions for using TIF to create local jobs. Full report at Newstips.

Competing visions for the southeast side

Businesses and environmentalists square off on the Southeast Side over new industrial developments, including a coal gasification plant, a cement plant, and an asphalt storage facility, Kari Lydersen reports.

Environmentalists worry about emissions and other issues, while companies promise emissions controls — and jobs.

The area once had one of the nation’s largest concentrations of heavy industry, spewing toxic pollution; it also features Chicago’s greatest expanse of wetlands and open spaces. Environmentalists would like to focus on those natural assets to drive the community’s economic future — and they point out that about 250 jobs at the three new facilities is nothing near the tens of thousands formerly employed at steel mills.

“As much as jobs are needed, some residents worry the area will again become the place where Chicago’s dirty work is done,” Lydersen reports

Austin stiffed by TIF

With Mayor Emanuel’s TIF panel looking into the program’s effectiveness, AustinTalks examines its impact in a community with the seventh-highest unemployment rate in the nation – and finds it falling far short.

Only four TIF projects have been authorized for Austin; only one – relocation of a Coca Cola warehouse – has met the terms of its TIF agreement; and that project has employed just 28 people who live in or near Austin, according to a report by Ellyn Fortino.

More than half of the 200 TIF projects authorized since 2000 are located downtown (as Fortino and ChicagoTalks staff previously reported in the New York Times).  “Few if any projects can be found in Chicago’s most blighted communities on the West and South Sides,” Fortino writes in today’s report.  “And many of those projects haven’t been completed at all – if started.”

Of $22 million in TIF subsidies allocated for Austin, “only $1.4 million has been paid out – most of it for the Coca Cola distribution center,” Fortino reports.  That’s out of $1.2 billion citywide.

That project is “a prime example of how low-income neighborhoods in TIF districts don’t get what they deserve,” with property taxes diverted from public services to benefit big corporations, one activist tells AustinTalks. It’s “legalized corruption,” says Dwayne Truss of the South Austin Coalition.

As for those other TIF projects in Austin, “no one in the Department of Housing and Economic Development, which oversees the TIF program, could shed light on why the three other projects are incomplete,” Fortino writes in a sidebar.

David Orr recently offered suggestions for Emanuel’s TIF panel, focusing on recapturing funding for schools and other public bodies.  Newstips recently reviewed a range of proposals for TIF reform.