Why most middle-income homeowners are getting the middle finger in Lawrence – Part 2
Last week I explained how the City of Lawrence sets the tax rate and now I will tell you how different it would be if not for the “affordable” homes being created. Our tax increases have come while the City has been under an overseer.
Some of the agencies operating these places are Lawrence CommunityWorks (LCW) – who rents these apartments and collect rent to subsidize their salaries. They also provide affordable single-family homes for low income that are also minimal on city taxes. Since 2000: Lawrence CommunityWorks, has been responsible for over $27 Million in community assets development, including over 250 units of rental and homeownership housing and most of it tax-free. Which places the burden of coming up with the city’s portion of taxes on the homeowners who pay full price. LCW is just one of many agencies doing great work in the city but at your cost. The apartments are, for the most part, subsidized by some other agency. So the money is coming in.
Some agencies are like CLASS, Inc. or Vinfen in which all of their clients are from outside the city, use Lawrence as a central base because they don’t want to burden their cities with tax exemptions. I am not even sure why the Greater Lawrence Sanitary District has exempt properties because Lawrence pays them for all of the waste processing, by the gallon! And let’s face it, there are a lot of churches and their properties, but some of these churches are there to house people not so much as churches but churches are exempt by laws.
The hundreds of non-tax paying firms, agencies, churches, have all over the course of years convoluted Lawrence. Most of the large ones are lead or operated by individuals that don’t live in Lawrence. It’s their way of keeping non-profits out of their “backyard” and getting a salary on the poor’s expense. Yes, the presidents and executive directors reside elsewhere, bring their non-profit to Lawrence, clients are outsiders, Lawrencians, or a combination of both.
Some of the approvals for non-exemptions fall back on the city elected officials for making dumb decisions on real estate gambles or approving contracts like giving away the rights for a lifetime of free parking to the Museum Square apartment owners.
Every two weeks a group of individuals meet to discuss building constructions in the city; they include everyone from Community Development, Inspectional Services, Finance, Mayor, Fire, and Police. They decide whether the city will issue out any permits to build based on what they believe is best for Lawrence. Except, that they don’t know what’s best for Lawrence because:
- Half of the people on that team do not reside in Lawrence,
- They play politics and give away property for building more homes that won’t add to the tax based,
- They create policy and don’t follow their own policy themselves.
- They don’t include ideas or comments from the public.
What this group and most non-profit agencies in Lawrence are doing is racially segregating people. They are doing so by creating all these low income units in Lawrence while not demanding that other surrounding cities build affordable housing. In a New York Times article it was once reported on tax credit and they stated the charge against the credit is that the housing units it subsidizes are “disproportionately built in majority nonwhite communities,” which “means… that the federal government is essentially helping to maintain entrenched racial divides.”
Since 2014, when Mayor Rivera came into office, the first thing he did was commission a housing report in order to have his friends at Lawrence Community Works (LCW) and other agencies get rich on the poor’s expense. You have to remember that his first chief of staff’s husband is employed at LCW as well as some other friends that have been on his campaign. So there is an interest that these agencies that did not care for Lantigua and instead helped Rivera and in turn got something in return (besides getting a free water park in front of their building). There is another 80 units of housing that LCW is working on and Mayor Rivera is giving the green light for all the support the agencies gave during his campaign. LCW states that building housing is a better way to create middle income, but in essence the tax credit is a low-income program.
Mayor Rivera has indicated that Lawrence has added “1,900 units to its housing stock over the last 10 years. Many of the units have been built with the government tax credits and subsidized loans that make them affordable.” How does tax credit work? Developers of affordable rental housing developments apply to DHCD for tax credits. If they are awarded the credit, the developers (either for-profit or nonprofit) seek investors to help pay for the development of the housing. Intermediaries (known as syndicators) act as a bridge between investors and projects and often pool investors’ money into equity funds. In exchange for providing development funds, the investors receive a stream of tax credits. Projects can qualify for two types of credits: a 9% credit, or a 4% credit.* Tax credits can be claimed by the investors for 10 years.
Both for-profit and nonprofit developers can qualify for the credit. At least 20% of the units must be reserved for persons with incomes at/or below 50% of the area median income adjusted for family size; or at least 40% of the units must be made affordable for persons with incomes at/or below 60% of the area median income adjusted for family size. In addition, the project must be retained as low-income housing for at least 30 years.
The more the Tax Credits in the City, the less in taxes are collected. The benefits of the tax credits are supposed to flow through to tenants in the form of lower rents, but studies suggest that investors, developers, and financial companies gain most of the benefits.
Governor Baker is hoping to have a bill approved that will assist Mayor Rivera with easier conversion of rezoning businesses into residential status so that mills in Lawrence can be converted into subsidized apartments (LIHTC – pronounce “lie-tec”.) I am sure that just like Rivera, Baker has companies he preferred do the construction of these mills. The vacant mill buildings get taken off of the tax role as business or commercial property. When converted, they get put on the residential property tax role.
The LIHTC is a ripe target for fraud and abuse, which is perpetrated by tenants, developers, and government officials. Tenants abuse the program by occupying housing units to which they are not eligible, often by claiming a false income level on disclosure forms. Developers abuse the program by inflating their reported construction costs to receive excess tax credits. I’d like to know if there are any kickbacks from these non-profits in Lawrence to Mayor Rivera.
In a future article of Rumbo, I’ll go into a plan that Mayor Rivera is hoping to get into full operations – providing tax credit and paying less for city properties for teachers’ residence.
Mayor Rivera is losing it
At times, I wonder if his goofs are for the purpose of staying visible or active in the media. He doesn’t realize that he is making a fool of himself every time he opens his mouth and what comes out hasn’t made a pit stop in his brain.
There was article last week in The Eagle-Tribune where he criticized Democratic candidates running for President of the United States and got into a war of words with Congressman Seth Moulton who announced his intention, too. Believing that he is like Karmack the Magnificent (Johnny Carson’s character of a soothsayer), he doesn’t think about what he’s saying and thinks he’s fooling all of us.
He thinks of himself as a significant opinion maker sending tweets to several candidates telling they should drop out of the race because they are irrelevant. His mind is made up that Senator Elizabeth Warren is the best and they should abide by his wishes.
But the article did justice to his ignorance when he complained about New York Mayor DiBlasio who is also running and said, “When was the last time a New Yorker was president?”
The reporter added in parenthesis that Donald Trump is a New Yorker.
People fear that by not saying something, others would think they are stupid but they should do their homework before making statements like that. The problem is that if they open their mouths it may reveal that they really are dumb.
In a brief search on the internet, I found that besides President Trump, there were 6 others:
Franklin D. Roosevelt served four terms as president from 1933-1945. He was born in Hyde Park, New York. FDR served as governor of New York in 1928 before he was elected president.
Theodore Roosevelt– 26th president was born in Manhattan, NY
Grover Cleveland – Was governor of New York.
Chester A. Arthur, a graduate of Union College, practiced law in New York City.
Millard Fillmore, the 13th president, served from 1850 to 1853. When President Zachary Taylor died after about one year in office, Fillmore (Taylor’s vice president) stepped in. Fillmore was born in the Finger Lake region of New York.
Martin Van Buren, the eighth president of the United States, was from Kinderhook, New York.
I recently heard a phrase that represents clearly our mayor: His brain is like termite-infested driftwood.
The abortion ban and Roe v Wade
In preparation for our citizenship test we had to study civics, the Constitution and how the judicial system works. There are federal laws, state laws and local laws or city ordinances and they should be respected in that order. A state law cannot surpass a federal mandate just like a city ordinance must obey both, local and federal regulations.
It never ceases to amaze me how the Lawrence City Council establishes ordinances that go against state laws. The same happens in certain states creating their local versions of abortion laws.
This is not an argument of whether or not you agree with abortions. I am explaining how some states have decided to allow an abortion even at the moment of birth when the mother still can decide if the doctor should kill that baby just born. Other states have forbidden abortions after 8 weeks or once the fetus’ heartbeat has been detected.
Meanwhile, in 1973 there was a landmark decision of the U.S. Supreme Court in which “…the Court ruled that the Due Process Clause of the Fourteenth Amendment to the U.S. Constitution provides a fundamental ‘right to privacy’ that protects a pregnant woman’s liberty to choose whether or not to have an abortion.”
As I warned you, this is not about which of the three situations is correct or you agree with. This is about states creating laws that conflict directly with the Supreme Court’s decision.
Do they do it to attract attention away from something else? Perhaps, they know it will be vetoed by a higher court but they are distracting the public while getting away doing something underground?
