Reversing the Residual Effects of Redlining

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A process beginning in the 1930s, redlining describes how banks and government agencies discriminated by race in determinations for federally-backed mortgages. At the March Congressional City Conference, local leaders used redlining maps of Baltimore and Muskegon, Mich. to examine the intersection between racial equity and affordable housing.

“Housing is a key priority for NLC and our current President Mayor Karen Freeman-Wilson,” said Mayor Lovely Warren of Rochester, N.Y., co-chair for NLC’s Race, Equity, and Leadership (REAL) Initiative. “One priority for the REAL Council to consider is how to best influence the recommendations in NLC’s upcoming housing task force report.”

In the 1930s, the Home Owners Loan Corporation created risk maps for home loans indicating that neighborhoods with higher proportions of people of color were a riskier  investment for the federal government to finance. Without access to FHA-insured mortgages, black families who sought homeownership were often forced to turn to predatory and abusive lenders, setting families of color behind while white families could accumulate wealth. A century after redlining procedures began, race still determines where private lending and investment happens in Baltimore, despite the 1977 Community Reinvestment Act, a federal attempt to eradicate redlining.

While systemic barriers still exist, local governments can play a pivotal role in reversing the effects of historical redlining and creating opportunity for their residents. Here are four ways local leaders can begin to map residual inequity and start healing processes in their communities.

1. Study the History of Your City

Mapping Inequality lets visitors browse more than 150 interactive maps and thousands of 1930s area descriptions. This resource from the Center for Investigative Reporting maps statistical analysis and tracks modern-day disparities in metro areas across the U.S.

“In thinking about redlining, it really surprises people that our country was engaged in intentionally keeping some people out,” said Mayor Kate Stewart of Takoma Park, Md., co-chair for the REAL Council. “What I’ve found that has been really powerful is going back to policies written at the time. It’s very shocking when people actually read how people were described and the fact that there are communities that have these covenants that clearly state ‘this house cannot be sold to a black person.’”

2. Revise Policies that are Implicitly Racist

“All of our institutions have evidence of residual racism. Complaint-based systems play out in their community to favor some members of the community and disfavor others. People who speak the dominant language and have the time and power to contact a government staff person get their sidewalks fixed first, get their roads repaired and their lights changed first. In most communities across the country, lack of access to and limited response from city leadership goes to our communities of color,” said Mayor Stewart.

Having dedicated staff to oversee the reversal of implicitly racist policies and the implementation of new ones can help. “If you don’t have someone on your staff who is responsible for racial equity implementation, I would highly suggest that you consider it,” said St. Louis Park, Minn. Mayor Jake Spano at the REAL council lunch meeting.

3. Incentivize Investment in Economically Deprived Areas

“My advice would be to just call it what it is,” said Councilmember Demetrius Coonrod, the first black female city councilmember in Chattanooga. “When we have space that is dilapidated, talk to the owners of the space, purchase those properties as a city and refurbish it for people who have difficulties owning a home. Challenge the banks within your communities to encourage their bankers of color to become homeowners. As long as we limit people based on their skin color, it’s going to continue to perpetuate the issue of race.”

Carlton Brown, principal at Direct Investment Development added, “Make collateral investments in things other than housing, such as schools and cultural institutions, too.”

Opportunity zones may present another way to incentivize investment in underserved communities. At the Tuesday General Session, Secretary of Housing and Urban Development Ben Carson said, “The nice thing about the opportunity zones programs—as opposed to other programs where people would come in, take their profit and leave, this has the long-term incentive.” He added, “Rich people are going to take their money and invest it somewhere. Why not incentivize them to invest it into communities that are neglected and deprived?”

4. Attend NLC University for REAL Action Training

There’s an opportunity for city leaders to attend free trainings to learn how to apply a racial equity lens in a more effective way.  For more information about advancing racial equity in local government, learn more about the next NLC University: REAL Action seminars here.

About the Author: Terrance L. Hamm is the communications specialist for the Institute for Youth, Education, and Families, and the Center for Race, Equity, and Leadership.