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Six Things To Know About Housing in Louisville in 2015

Affordable housing got a boost in this year's city spending plan.

The Metropolitan Housing Coalition's 2015 report on the state of housing in Louisville takes a look at how two recent federal decisions could affect current and future policies on fair housing locally.

The landscape has changed since the agency's last report: This summer, a U.S. Supreme Court decision allowed people affected by discriminatory housing policies to challenge the rules, even if the bias was not intended. And a recent U.S. Housing and Urban Development ruling on an initiative to advance fair housing policies across the country will allow any decision or development strategy fueled by federal funding and relating to fair housing to be scrutinized.

The report, which the group released Tuesday, examines how Louisville policies may work into these new parameters. And it takes a broad look at other issues related to public housing and poverty.

No Policy Left Out

Everything from home appraisals and infrastructure planning to mortgage loans and tax increment financing districts are now subject to examination under a lens of fair housing, said Cathy Hinko, executive director of the Metropolitan Housing Coalition.

And any policy that has an impact on the prevalence of fair housing is now open to legal scrutiny, she said. For example, if Louisville fails to get its share of funding from the state's affordable housing trust fund, that may have a disparate impact on a protected class of residents: minorities, single mothers and people with disabilities.

She said tax increment financing districts, which are not mandated by law to focus on affordable housing, may even be subject to the provision of the federal Fair Housing Act in the aftermath of the U.S. Supreme Court's decision.

"We have over $2 billion in tax increment financing, some of it helps create residences, but none of those residences have been affordable housing residences," she said.

Hinko said every deal relating to development must now be examined for what it does — and doesn't do — to further fair housing.

"We're saying every industry has the ability now, the mandate, to look at what impact they are having, and if they see a bad impact it's incumbent on them to figure out what's causing that," she said.

Focus on Future Planning Efforts

The Supreme Court decision and HUD ruling come at a "critical moment in planning Louisville's future," the report says.

City officials in recent months have taken steps to increase fair housing, including changes in zoning policies that allow multifamily units to be constructed throughout the county. But she called those changes too "passive."

Public works projects, including transportation and stormwater systems, must be examined to ensure that disparate impact is not occurring within any neighborhood, she said.

The city's current comprehensive plan, adopted in 2000, excludes aspects directly related to fair and affordable housing. Hinko said as this plan is up for reexamination in the coming years, it is imperative city planners consider fair housing objectives.

"It would be great to have a plan that uses the lens of fair housing," she said.

Subsidized Housing Remains Clustered In Louisville

Concentrated pockets of poverty in cities can have detrimental impacts on the people who live there, from higher crime rates to generational impoverishment, according to reports from sociologists Robert Sampson of Harvard and Patrick Sharkey of New York University, as well as from CityLab's Richard Florida.

There are more than 18,000 subsidized housing units in Louisville, according to the report. This includes public housing and Section 8 housing.

Nearly half of those units (48 percent) are situated in just three Louisville Metro Council districts (1, 4, 6), according to the report. Nearly a quarter are in District 4 alone.

Of the roughly 4,200 public housing units, nearly 77 percent are situated across two Metro Council districts (4 and 6), the report shows. District 4 accounts for more than half of all public housing units in Louisville.

Residents benefiting from Section 8 assistance live in every Metro Council district. A majority of Section 8 assistance (68 percent) is for housing vouchers that give recipients a choice to live wherever the vouchers are accepted. Other residents receive project-based assistance, which allows them to use a subsidy to offset the cost of rent.

Despite the distribution of Section 8 recipients throughout Louisville, nearly 70 percent of Section 8 units are situated in just seven of the city's 26 council districts.

Hinko said local lawmakers should pursue policies to build affordable housing in areas where it does not currently exist.

Homeownership Rates Trending Up, But Disparities Remain

For the third straight year, homeownership rates in the Louisville metro area are on the upswing, the report shows. Though Hinko stressed it's not yet at a full recovery from pre-recession days, it's progress.

In 2014, the homeownership rate among Louisville residents hovered around 69 percent, a steady climb from 61 percent in 2011. The rate peaked in 2003 at just more than 70 percent.

This is positive considering the national homeownership rate among metro areas fell slightly from 2013 to 2014. In that time, the rate climbed in Louisville, the report shows.

Still, racial and ethic disparities exist among homeowners, both nationally and in Louisville.

The homeownership rate among white residents across the nation is about 69 percent, whereas for black residents it's about 43 percent and for Hispanics it's about 45 percent. One reason, the report says, is that black and Hispanic residents are turned down for mortgage loans at a much higher rate than their white peers.

For instance, in 2014, white residents in Louisville submitted more than 37,000 mortgage applications, of which 18 percent were denied. In that same year, black residents submitted 3,100 applications, of which 29 percent were denied. Nearly 24 percent of the some 1,000 mortgage applications submitted by Hispanic residents were denied, according to the report.

Foreclosure Rates Trending Down

From 2013 to 2014, the number of foreclosures ordered in Louisville dropped 42 percent.

Despite the huge drop and the fact that the current amount of foreclosures is the lowest it's been in a decade, it's still 92 percent higher than the low in 2002, according to the report.

Scott County is the only county within the Louisville Metro service area to see an increase in foreclosures from 2013 to 2014.

Homelessness Among Families Continues

Despite city leaders touting recent successes in developing systems that will help end homelessness among veterans in Louisville, the housing report shows that thousands of families and children here remain homeless.

Nationally, the number of homeless students has more than doubled since 2004.

Locally, there are just more than 6,400 homeless students reported in Jefferson County Public Schools, which is a slight decrease from the 2013-2014 school year, the report shows. The homeless population among Jefferson County Public School students represents more than 6 percent of the entire student body.

Hinko said lawmakers should provide the city's affordable housing trust fund with a dedicated revenue stream, which could help alleviate the burden of homelessness among some families. Although Louisville leaders are making an effort to increase the city's stock of affordable housing, the current push is not enough to begin to solve the problem, she said.

There are more than 17,000 Louisville residents on a waiting list for Section 8 housing assistance, according to the report. Nearly 7,000 are waiting for public housing.

Here's the whole report:
[scribd id=292710201 key=key-eDfk9VEA2KvBSfFGTc8Q mode=scroll]

Jacob Ryan is a reporter for the Kentucky Center for Investigative Reporting.
Jacob Ryan joined LPM in 2014. Ryan is originally from Eddyville, Kentucky. Email Jacob at jryan@lpm.org.