West Louisville Gentrification: What is the 9th Street Divide Redesign Project, Vision Russell, and Russell: A Place of Promise?
Disclaimer: The Root Cause Research Center (RCRC) does not see all development as bad development. We ARE taking a somewhat controversial stance toward development by asking that all development include a Right to the City for low-income residents. Good development is equitable and just. Good development goes beyond limiting displacement and actively creates strategies for emplacement, where vulnerable communities can thrive through community benefits agreements (CBAs), shared equity models and protection from racial capitalism and racial banishment. We’re talking about development that isn’t just about community engagement strategies, nor just about community involvement. Equitable and just development is about community shared governance and mutual benefit. RCRC recognizes that power (i.e. wealth, property, influence, etc) is hoarded in cities like Louisville, KY. Under these circumstances, we believe in building spaces of shared power, mutual learning, and authentic collaboration.
Our work in gentrifying neighborhoods has discerned that it is the duty of gentrifiers to: 1) reach out to residents (opposed to “community leaders” who do not live in the neighborhood), 2) initiate community benefit agreement negotiation in partnership with a third-party expert, 3) give residents access to information and data collected or referenced by the development project, 4) build in cooperative economic and wealth building mechanisms for low-income residents so that they may share in the benefits of development, and 5) actively advocate for policies that protect tenants from increased costs of living resulting from investment such as rent stabilization and stronger tenant’s rights laws. A few examples of cooperative economic and wealth building mechanisms are as follows: a) a collective investment plan, which allows residents to pool their money so that they may participate as a stakeholder and investor that will receive a return on their investment, b) a tangible and authentically affordable housing pathway for below median income residents who currently rent, and so on.
RCRC defines a gentrifier as an individual, institution, organization, or corporation that financially benefits from a development project in a traditionally divested neighborhood that does one or both of the following: caters to upper- or middle-class lifestyles with the intention of appealing to affluent new or future residents; and/or systematically displaces & replaces low-income people for profit. Well intentioned and community-minded gentrifiers may have transformational aspirations to equitably and justly involve residents in the ways that we have listed above in the gentrifiers duties section, but until those aspirations have been given accountability mechanisms outside of verbal promises, they are painfully trivial ideas that mitigate guilt, culpability, and saviors’ remorse.
In an effort to lend insights and capacity, RCRC has already joined the Russell: Place of Promise Advisory Board. We will continue to advise and build capacity around what we see are the duties of a gentrifier in that space, and in any other space that community members request our presence. Community members can submit a verbal request or through our website on our contact page.
With that said….
In 2013, Gill Holland, developer and member of Kentucky’s wealthiest family, launched the Portland Investment Initiative in the Portland neighborhood just north of Russell, with the goal of bridging the “financial gaps that hinder” investment in the area. Holland was laying the groundwork for future investment in Louisville’s West End, but struggled to attract large private investment partners. After the market crash of 2008, most cities saw a bleak future in investing in single family, urban sprawl development, and began shifting their focus to the urban core. Somehow, Louisville missed this writing on the wall and continued to incentivize suburban investment through sprawl machines like a massive suburban park and an even larger interstate bridges project, putting Louisville 5 to 10 years behind cities like Nashville and Cincinnati, who shifted their investment focus downtown after 2008.
In large cities, private capital is mostly capable of laying the groundwork for gentrification on its own without large public subsidies. The job of the public sector is usually to provide infrastructure support and prioritize the tastes of white urban dwellers with things such as urban design improvements, transit improvements, “reimagined” public spaces with dog parks, bike lanes, artistic bus stops and the like (all the things commonly known as urbanism). But in smaller cities, where private capital is more risk sensitive, investors require the public sector and philanthropy to carry the risk for them to protect their investments. All over the country, public services are being slashed in small cities in the name of neoliberal redevelopment policies as they try to “compete” with the largest metros in attracting capital by giving away land and revenue to developers through incentive programs. And the first things that get slashed from the budgets are programs that benefit poor people. One only has to look at the publicly funded sports stadiums and luxury hotels in cities like Louisville, Nashville, and Richmond, VA to see evidence of this compulsive neoliberal mania.
For the Russell neighborhood, this process began in 2015 when the city began their narrative of eliminating the historic “9th Street divide” that separated Louisville’s downtown from the majority Black West End. In order to attract capital across 9th Street, the Louisville Property Valuation Administration increased residential property values in the neighborhoods to the east and south of downtown. Small homes in the traditionally affordable neighborhoods of Clifton, Germantown, Shelby Park, and Butchertown were suddenly out of reach for many people, setting the stage for the development of market rate homes in Russell and Portland. Also in 2015, Louisville Metro Government gave $778,000 in forgivable loans to the Lexington, KY developer, Community Ventures Corporation, to buy 29 residential parcels of public land in Russell. While assurances were made at the time that these market rate homes would sell between $80,000 and $150,000, some of these homes in the Cedar Street area of Russell are already on the market for upward of $160,000. Around the same time, the Louisville based James Graham Brown Foundation granted Community Ventures $250,000 for the development of Chef Space in Russell, “a 13,000 square foot kitchen incubator aimed at bringing area entrepreneurs and small business owners to West Louisville.”
Over half the land in Russell is owned by private entities outside the community with 13% of the land owned by out of state entities. Much of Russell is owned by non-profit housing developers and out of state investors. In explaining why local government was giving away land and money to out of town developers in 2015, then Louisville Metro Director of Redevelopment Strategies, Jeana Dunlap said that, “public investment creates synergies that incentivize others to invest in neighborhoods” because, “private investors know that they are not alone.” In 2019, Louisville Metro made another $1 million available to developers for market rate housing in Russell through forgivable and revolving loans. This public investment in market rate housing will increase investor activity, which will in turn increase rents, resulting in even more land being purchased by investment firms, making wealth extraction and gentrification more rapid and harmful to those making below $25,000/year.
The Root Cause Research Center offers an alternative vision to the one currently being employed by local government; instead of giving away land and forgivable loans to private developers from outside Louisville, give the money and land directly to Russell residents to create community land trusts, where it can be kept affordable in perpetuity.
The Russell: A Place of Promise (RPOP) project is a $26 million initiative with the stated purpose of “building Black wealth through investment without displacement.” The project's actual deliverables are fairly modest despite its extravagant marketing campaign. Conspicuously missing from the project is a large urban design and urban planning component, which is typically the public sector’s primary role in redevelopment. Normally, the redevelopment of individual structures are left to developers, but in the case of Russell, the local government is acting as the de facto developer. For example, RPOP is redeveloping a 3.6 acre warehouse that appraised at $438,000 by Jefferson County Master Commissioner in January 2017 and at $1.18 million by Jefferson County Property Valuation Administrator in March 2017, after Louisville Metro Government transferred the property to itself.
In May of 2018, Louisville Metro Government, with the Community Foundation of Louisville as fiscal sponsor, along with Cities United, submitted a proposal for $5 million to the North Carolina based, Kenan Charitable Trust. There were three committed board members for RPOP at the time of the grant application, including “small scale developer,” and North Carolina native, Gill Holland. The grant requested funding for the following deliverables:
135 market rate homes to increase the rate of homeownership by 20% (678 to 813).
Creation of 5 new businesses using a cooperative or non-traditional structure, with at least 30 new jobs created.
150 career tracks filled, and at least 50 young adults (ages 18-24) participate in workforce development programs.
Development of a historic warehouse property to support at least 5 new businesses, 25 residential units and a variety of community uses.
Create a formal and informal operating and decision-making structure where residents can provide feedback and guidance that will lead to a documented community benefits commitment.
Create 6 new franchise ownership opportunities for Russell residents with 120 new jobs.
Make no mistake, the RPOP project is gentrification. When artistic bus stops and corporate sponsored murals go up in a neighborhood, it's a wrap. As we explained in our blog post Louisville Wins at the Expense of Vulnerable Black Communities: How Hiding Poverty and Displacement is a Violent Strategy to become a Competitive City, the city financially benefits from the crisis of racial banishment and the criminalization of poverty in historically Black and traditionally divested communities. Even though RPOP has publicized interest and intent to implement some crucial components that would fulfill its duties as a gentrifier, few have been realized. At the same time, beyond the usual indicators, there is a deeper class and power imbalance in a project that focuses on market rate homes in a neighborhood where the median income is below $15,000/year and over 80% of the residents are renters, particularly when there is a housing shortage in Louisville that exceeds 30,000 units for people making below $25,000/year.
A 2016 study found that a $100 increase in median rent is associated with a 15% increase in homelessness in urban areas. Rents will inevitably increase as more market rate development occurs. With no public policies in place to protect renters; evictions, houselessness, and cost burdens will increase. These facts alone raise questions such as:
If these homes aren’t financially accessible to current residents, who are these homes actually for?
Without renter protections in place, what is the estimated rate of displacement?
Does RPOP use a different definition for wealth when it talks about Black wealth attainment than it does for white wealth attainment?
If so, then how do we move to a definition that sees Black people as competent, capable, worthy, and owed entitlements? Where are the pathways for residents to gain access to housing, employment, and cooperative economic opportunities?
According to the logic of neoliberalism, local government has 2 jobs: 1) to attract as much capital to the city as possible and 2) to make sure residents (workers) are completely obedient and subservient to that capital. The subservience and obedience are maintained by media and nonprofits through perception control, optics management, and corralling dissent by co-opting social justice language to appear to be working on behalf of residents. In 2018, Gill Holland’s publishing company released a book about the history of Portland. He has already commissioned a similar book about Russell by a local journalist. The Louisville Metro Housing Authority commissioned a documentary film about the history of Beecher Terrace by a local film-maker and a former public housing resident. RPOP and Kenan Charitable Trust commissioned national journalist Soledad O'Brien to do a lengthy feature on the project for her television show, Matter of Fact. In a city where the media is tightly controlled by a few wealthy families (Holland served on the board of Louisville Public Media for the past 9 years, retiring in July 2019), what avenues do communities have to produce counter narratives that challenge systems of oppression? How do impacted communities gather information to build collective power? How do residents find out what is actually happening in their community?
Remaining questions …
When will RPOP begin the community benefits agreements negotiations with current Russell residents?
What brought the Kenan Charitable Trust to Louisville? The Chapel Hill foundation is currently managing a public relations struggle about the history of the Kenan family patriarch’s participation in the 1888 Wilmington Massacre, and the Kenan name was recently removed from the University of North Carolina football stadium amid protests from Black activists. But why Louisville? Why is Kenan now investing heavily in many Louisville nonprofits?
How does Louisville Metro Government justify providing public investments in market rate housing in the midst of a massive affordable housing shortage? In November 2019, the Louisville Metro Council approved an additional $900,000 in forgivable and revolving loans specifically for the market rate housing in Russell.
Only 18% of the land in Russell is owned by Russell residents, with only 11% of the land occupied by homeowners. 36% of the land in Russell is vacant land owned primarily by out of state investment firms.
What does a right to remain in Russell look like for current residents who can no longer afford rising rents?
What does it mean to build wealth in a neighborhood where the median income is $15,000/year?
What impact will over 135 new market rate homes have in a neighborhood where the median income is $15,000/year?
In neighborhoods with rising rents, many low-income people opt into homeownership as a way to escape a rental market they cannot afford. Is RPOP incentivizing homeownership for low-income people using predatory inclusion, locking them into a 30 year debt?
What does it mean when the Mayor says, “We must revitalize neighborhoods without destroying the soul of the people who built them?”
If a $100 increase in median rent is associated with a 15% increase in homelessness, what is being done to protect residents from predatory rent increases and evictions?
What does it mean to revitalize a neighborhood without displacement, when the first large project in the neighborhood demolished public housing and displaced over 1,400 people?
Alternative Model
From these questions, we offer an alternative to the current extractive model of investment. Instead of giving land and forgivable loans to developers for market rate housing, we suggest giving publicly owned land and money directly to Russell residents, where it could be placed in a Community Land Trust and remain affordable in perpetuity. These parcels could be a mix of commercial, single family ownership, and rental properties, but owned collectively, by current residents. Subsidize Black residents. Let white private developers subsidize themselves.
The Root Cause Research Center will address these questions and more in this ongoing series. Next, we will look at the Smart Russell project and the role of the police, surveillance and technology in gentrification efforts.
References:
1. Anna Papadopoulos, Ranked: The Richest American Families In Each U.S. State, 2019, CeoWorld Magazine.
2. Sarah Jackson, Property taxes to increase for some Louisville residents, Wave3 News, 2015.
3. Sheldon Shafer, New housing coming to Russell neighborhood, Courier Journal, 8/27/2015.
4. Zillow, Russell Louisville Real Estate & Homes For Sale, 01.10.2019.
5. Parsons, Mike, In One Accord, more on West End gentrification, LEO Weekly, Oct 07, 2015.
6. Louisville Metro Government, Russell Market Rate Housing Program Notice of Funding Availability, March 2019, https://louisvilleky.gov/sites/default/files/housing_community_development/russell_market_rate_nofa_3-2019.pdf
7. Louisville Metro Government Office of the Mayor, Open Records Request #12478, 10/17/2019.
8. Louisville Metro Housing Authority, Vision Russell Transformation Plan, January 2017.
9. Louisville Metro Government, 2019 Housing Needs Assessment, 2019.
10. Byrne, T., Munley, E., Fargo, J., Montgomery, & Mulhane. (2016). New Perspectives on Community-Level Determinants of Homelessness. Urban Affairs, 607*625.
11. Louisville Public Media, Meeting Minutes May 2019 https://louisvillepublicmedia.org/our-board/.
12. Louisville Metro Government, Council Meeting Minutes 1/07/2019, http://legistar2.granicus.com/louisville/meetings/2019/11/8503_M_Metro_Council_19-11-07_Action_Summary.pdf
13. Jackson, Kyeland, This Week In Conversation: The State Of Black Louisville, WFPL, Feb 20, 2020, https://wfpl.org/this-week-in-conversation-the-state-of-black-louisville/
This blog series was written with assistance and contributions from Root Cause Research Center Accountability Council Members:
Mckenzie Eskridge
Shannon Floyd
Shemeaka Shaw