Austin not included in city’s new foreclosure initiative (Austin Talks)

By Jennifer T. Lacey

September 30, 2011

When the property at 4845 W. Van Buren St., went into foreclosure this year, it became one more address on a growing list of abandoned properties in Austin.

 

With its crumbling facade, the two-flat sits on a well-shaded, quiet street among vacant lots and homes with abundant gardens. There are 16 properties in foreclosure in the 4800 and 4900 blocks of West Van Buren Street and Gladys Avenue, some littered with trash and some being used as after-school hang out spots.

 

Although foreclosures in Austin are on the rise, the city’s most-populated neighborhood was not included in a new loan program, causing some to question why the West Side was left out.

 

Mayor Rahm Emanuel’s Micro-Market Recovery Program targets nine Chicago neighborhoods that will be eligible for loans to help prevent foreclosures. The program will be funded with up to $20 million from The John T. and Catherine D. MacArthur Foundation, and the city expects additional money from nonprofits, lending groups and developers, for a total loan pool of $50 million, the mayor said at a press conference in August. The goal: to assist about 2,000 to 2,500 units in the next three to five years.

 

The targeted communities are Humboldt Park, Chatham, Chicago Lawn, West Woodlawn, Auburn Gresham, West Pullman, Belmont Cragin, Englewood and Grand Boulevard.

 

Austin’s absence on the list is a sign the city has again ignored the needs of  Chicago’s most-populated neighborhood, said one community organizer.

 

Elce Redmond, an organizer for the South Austin Coalition, said it makes no sense that Austin isn’t included in the program since it has the highest number of foreclosures in the city.

 

“It sort of goes back to the whole additive that the folks in the city don’t really know where the heat is really coming from, where the issues are hot,” Redmond said.

 

City spokesman Tom Alexander defended the selection of the nine neighborhoods, saying the Chicago Department of Housing and Economic Development reviewed foreclosure data from a variety of sources, including the Woodstock Institute, community groups and banks to determine which areas to target.

 

Their findings showed that Austin’s completed foreclosure filings were up 1 percent in 2010, versus 19.9 percent citywide, Alexander wrote in an e-mail. Initiated foreclosures were down 6.4 percent in Austin and 3 percent citywide, while Belmont Cragin and Humboldt Park showed a 39.1 percent increase and 7 percent of completed foreclosures.

 

But a review of other data analyses paints a contrasting picture of foreclosures rates in Austin.

 

A National People’s Action report released in June analyzed Cook County Court records and found that Austin was at the top of the list of cities and towns with the highest foreclosure rates. Austin had 2,206 housing units in foreclosure during the period of January 2010 to March 2011, followed by Belmont Cragin and Humboldt Park.

 

Nicholas Bianchi, a research analyst for National People’s Action, said he thinks the city compared foreclosure rates year to year, which he said isn’t a good way of assessing the problem.

 

Bianchi said Austin has had high foreclosure rates for several years, and in 2009, they were through the roof. He said even if Austin had a zero percent increase in the foreclosure rate in 2010, the rate was still high.

 

“By 2010, the economy and all the housing problems caught up to them [nine other communities], and their foreclosure rate jumped up.”

 

Alexander declined to give specifics about the exact criteria used to determine the selected neighborhoods.

 

Austin resident Anna Friedman-Herlihy said her community is too often mischaracterized because data is misused, but she’s not upset that Austin was left out of the new loan program.

 

Friedman-Herlihy, a doctoral student at The University of Chicago, analyzed the National People’s report using 2010 Census and Cook County data.

 

Her conclusion? “It makes sense that it’s [Austin] not included.”

 

She said by sheer numbers, Austin ranked the worst, but she found Austin to be ranked far lower compared to other neighborhoods when the total number of houses and apartment buildings in each area is considered, falling to 27th out of Chicago’s 77 neighborhoods.

 

However, Friedman-Herlihy expressed surprise that one neighborhood – Chatham – was selected given the number of people who live in the South Side neighborhood.

 

“I have to say that if they are giving this money to Chatham, they certainly should be giving this money to a lot of other places,” she said.

 

Still, some community activists question the city’s use of data.

 

“If you look at Austin and Roseland, who were omitted from this (program), if you look at those communities, the incomes aren’t so attractive,” said William J.R. Fleming, chairman of the Chicago Anti-Eviction Campaign.

 

Fleming said he thought Emanuel’s program was going to be similar to the Illinois Hardest Hit Fund Program, which provides mortgage assistance to homeowners who are unemployed or underemployed, rather than including banks and developers.

 

He called the mayor’s initiative a “potential failure,” saying it didn’t focus on the real issue – the homeowner.

 

“If the end game is to provide the funding, why not to the homeowners?” said Fleming.

 

City spokesman Alexander said in an email, “it is false and inaccurate to say the program would be more of a benefit to the banks and developers” but rather the entire program is focused on the “well-being of the whole community.”

 

 

*These clippings are provided for "fair use" not-for-profit, educational purposes (and other related purposes). If you wish to use this copyrighted material for purposes of your own that go beyond "fair use," you must obtain permission from the copyright owner. Please contact Woodstock Institute for more information.