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"Public Housing Modernization and Race in New York City,"

by Kian Tajbakhsh March/April 1996 issue of Poverty & Race

Three areas of public housing management can have significant consequences for racial minorities: site location; tenant selection, the screening process by which applicants are assigned to vacant units; and modernization investment in physical maintenance of the projects. The first two areas are by now familiar to researchers, fair housing advocates and civil rights activists as frequent sources of discrimination and as explanations of racial segregation in public housing. Numerous and well documented examples exist of housing authorities that have engaged in racial steering and located public housing in minority neighborhoods contributing to the creation of communities characterized by racial segregation and concentrated poverty.

By contrast, the racial correlates of modernization investment on housing quality have not been examined at all. Indeed, there is almost no direct academic or legal literature on this area of public housing management. In 1990, several plaintiffs, assisted by the Legal Aid Society of New York, filed a complaint with the New York City Housing Authority (NYCHA) alleging racial and ethnic discrimination in the Authority's tenant selection policies. The complaint accused the Housing Authority of intentionally employing racially-biased criteria to allocate vacant public housing units to applicants, thus violating the 1964 Civil Rights Act and the 1968 Fair Housing Act. In 1992, a Consent Decree was signed, providing several remedies for the plaintiffs, as well as discontinuation of the NYCHA's racial steering policies.

In light of this outcome, housing activists involved with the case sought to examine other areas of the Housing Authority's operations regarding equitable distribution of resources among the racial and ethnic groups living in New York City's public housing. Supported by a PRRAC grant, I undertook to examine whether there was evidence of bias in the distribution of modernization funds to NYCHA projects on the basis of racial or ethnic occupancy patterns.

The central conclusion of my research was that there was no evidence of such bias. Because this is an issue that ought to be studied in other cities, I offer a description of the research design I used.

The Federal Modernization Program

The modernization program funds the capital expenses and repairs of the nation's public housing stock. (Operating expenses are funded separately.) HUD allocates funds to local housing authorities, which then distribute this money across their projects. The federal modernization program for public housing has gone through three phases: the initial phase, 1968-1980; the Comprehensive Improvement Assistance Program (ClAP), 1981-1991; and the Comprehensive Grant (CG) Program, beginning in 1992.

The major increase in investment in New York began with the ClAP: average annual investment nationally rose from $87 million for the 1981-1985 period to $178 million for the 1992-1994 period. Over 90% of total investment since 1968, almost $1.8 billion, has occurred since 1981 during the ClAP and CO programs. The average number of projects funded also increased significantly over this period. from less than 50 in the early 1980s to almost 250 by 1993. Despite this level of investment, the total need in 1995 - defined as the total amount of investment required to bring all housing authority units up to HUD's modernization standards - stood at over $8 billion.

Design of the Study and Data Sources

The central assumption of this study was that, in the absence of racial or ethnic discrimination, variations in modernization expenditures for public housing projects could be fully explained by physical infrastructure needs and building-related variables, such as the age and size of buildings. By contrast, variables such as racial or ethnic composition of the tenant population should not be associated with variations in modernization spending. The study thus examined the extent to which race variables play a role in the distribution of modernization funds across different public housing projects within the NYCHA.

The study utilized four data sets compiled from NYCHA's records for 328 projects in full operation (defined as completed and occupied) as of 1993: (I) physical, building-related variables, such as size and age; (2) the racial composition of tenants by project, 1981-1993; (3) NYCHA's 1995 estimates of total modernization need per project, obtained from annual inspections; (4) the total modernization expenditures allocated to each federally-funded project for the 1968-1992 period (I was not able to obtain adequate financial data for the 25 projects owned, managed and funded by the City and State of New York, a situation which is unique to New York. The sample thus comprised "federal" projects only.)

HUD categorizes any project with greater than 75% of one race as a "racially identifiable" project, so that a "Black" project, for example, is defined as a project with greater than 75% Black tenants. However, because there are far fewer whites as a proportion of all public housing residents and because Puerto Ricans are much less segregated than whites or Blacks, using the 75%. threshold would produce too few "white" or Puerto Rican projects to make useful comparisons. (In 1993, Blacks comprised 55%, Puerto Ricans 30%, and whites 8% of the city's total public housing population.) As a result, the threshold for qualifying as a "white" or "Puerto Rican" project in this study was reduced to 50%.

Is There Evidence of Bias in the Distribution of
Modernization Funds?

The simplest way to answer this question is to examine the amount of modernization investment received by projects of differing racial and/or ethnic composition. My analysis showed that the average total investment per unit, from 1968 to 1994, in Black and Puerto Rican projects of different ages were comparable (ranging between $13,000 and $19,000), whereas white projects received significantly lower amounts (about $9,000). These results incorporated a rough control for project age and size, and so did not evidence bias against minority projects.

The study examined several factors that might have underestimated the amounts going to white projects. However, none of these was found to alter significantly the general pattern described above. The first factor concerns the distinction between family and elderly projects. Family projects, which in New York City comprise over 86% of all projects, received greater overall amounts of investment. When the family and elderly projects were examined separately, neither the absolute levels nor the distributions changed significantly.

Second, the analysis did not include data on State and City projects since, as noted, financial data were unavailable. But given the similar racial profile of these compared to federal projects, as well as the relatively small total amounts received by these projects, it is unlikely that inclusion of this sample would have changed the above results.

Third, whites might live in better quality housing for reasons not captured by project age and size; if so, investment per unit of need might differ significantly by race. Notwithstanding some exceptions for older buildings, the data show that white projects do exhibit lower per unit need than minority projects of comparable age, and Black and Puerto Rican projects were of similar quality. (Statistical analysis showed no significant relationship of need data with racial occupancy.) Using a somewhat ad hoc measure, the study estimated that by 1995, on average across all age groups, Puerto Rican projects were funded at almost 50%, Black projects at 25%, and white projects at 15% of their total estimated 1995 need. Measuring investment in relation to need therefore does not alter the pattern discussed above.

Regression analysis conducted on the data confirmed the patterns presented above, in addition to providing some sense of the strength of the associations. Project age and size were highly correlated (positively) with modernization investments (as we would expect), and the presence of Blacks or Puerto Ricans was not a significant predictor of investment levels. However, the regression showed that the presence of whites was significant and negative. For reasons that would require further study, whites appear to have come off worse than minorities in this one case. Overall, then, the study concluded that the data did not reveal bias in this area of public housing management.

Implications for Researchers and Activists

The New York City findings not-withstanding, the question of equitable distribution of modernization resources across housing projects of different racial composition is one that should be studied in other cities as well. It is pertinent to note that obtaining the relevant financial information may be difficult and time-consuming. For housing authorities less well managed than New York City's, this may present especial problems. But the likelihood also exists that less well managed local authorities also provide their services in racially discriminatory fashion.

Beyond this consideration, HUD is in the process of transforming the nation's public housing program, phasing out public housing new construction, and moving to a tenant-based voucher system. As funds for new construction are minimized, it is likely that continued maintenance of the current stock, both distressed and otherwise, will take on a more central and critical role. The racial impacts of the modernization program, as well as the intersection of housing quality and race, will remain an important component of the new policies and strategies currently being designed.

Kian Tajbakhsh Kian Tajbakhsh is Assistant Professor at the Milano Graduate School of Management & Urban Policy, New School for Social Research, 66 Fifth Ave., New York, NY 10011 (212/229-5434, E-mail: edit). He would be interested in receiving comments or correspondence on the problems addressed in the report. A copy of the full report, “Is There Discrimination in the Allocation of Modernization Funds for Public Housing Projects in New York City(17 pp. + Figs., November 1995), is available from him.

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