City Hall

Dallas Developers Want Mayor Rawlings to Slow Desegregation Efforts

It's easy to get lost in all the affordable-housing stuff that's been swirling around City Hall for the past couple of years. First HUD was really mad at Dallas over its housing policies, then it wasn't, then the U.S. Supreme Court ruled in Texas Department of Housing and Community Affairs v. Inclusive Communities Project that the way Texas — and especially Dallas — does affordable housing is wrong and now HUD's mad again. Not at Dallas specifically now, but at the stubborn persistence of residential segregation in America more generally. Really, though, it's pretty simple: Dallas has been steering low-income housing into impoverished areas in contravention of both federal desegregation policy and reams of research demonstrating that poor people — particularly kids — fare better when they live in mixed-income neighborhoods than when they're shoved into ghettos.

Dallas, as we've previously noted, has had some trouble accepting the new reality. Just last month, Mayor Mike Rawlings was lobbying state housing officials to stick a subsidized low-income housing development next to a public housing complex. Meanwhile, elsewhere in City Hall, there has been a more honest review of the city's housing policy. The result: Housing Plus, a comprehensive housing plan that, even if the exact details right now are hard to pin down, represents a serious attempt to address past policy failures and current inequities between rich and poor; north and south; black, white, and Hispanic. The process has been going on for more than a year. On Monday, the City Council's Housing Committee will once again be briefed on the project in light of the Supreme Court decision and new HUD policies. City staff hopes to have a final draft of the policy to the council by the end of August.

That's a little too soon for Dallas builders and developers, who on Friday fired off a letter to Rawlings and the other 14 members of the City Council (embedded below) asking the city to slow down. The first two names on the letter are Linda McMahon, president of The Real Estate Council, and Phil Crone, executive officer of the Dallas Builders Association, the main local trade groups for developers and the construction industry, respectively. Also signing are 15 additional development executives and lawyers representing companies such as Trammell Crow Residential, Gables Residential and Jackson Walker. Heavy hitters, mostly.

What the industry wants, the letter says, is a dialogue. Crone, with the DBA, says he and his colleagues have been watching the development of the Neighborhood Plus program and were "getting the impression that staff was kind of making this up as they go and we wanted to offer our expertise." Crone, who sits on the housing task force for Rawlings' GrowSouth initiative, says the mayor "has a great track record of bringing industry stakeholders to the table" and hopes he will do the same in this case.

Fair housing advocates in Dallas see a more sinister motive. Mike Daniel, the Dallas attorney who successfully argued the Inclusive Communities Project Supreme Court case, says the business community appear to be trying to delay any meaningful progress on affordable housing. "It's sort of an old Dallas thing. ... All the rich white guys get together in a bunch and [try to intimidate] City Hall," he says. Not that he's sold on the Housing Plus plan. "Our assumption is they're just going to screw around and not do anything good and continue the bad habits they already developed."

The letter hints that the industry is uncomfortable with potential changes to the city's affordable housing policy, though the issue is framed as a preference for "predictability" rather than discomfort with affordable housing itself. "Changing the rules without sufficient notice will discourage other developers, lenders and investors from developing in Dallas, and they will choose to take their business to other municipalities where they can depend on the predictability of the process," the letter says. "It is also critical to our industry that any new rules adopted by Dallas City Council become effective after a reasonable amount of lead time in order to avoid unfairly and retroactively harming a development project that relied on a different set of rules and requirements prior to making that investment."

In an email to housing advocates — and a HUD staffer — on Friday obtained by the Observer, Theresa O'Donnell, the city's chief planning officer and architect of the Neighborhood Plus plan, suggests that the letter is a response to specific provisions of the current draft plan, to wit:

Strategic Goal 6 – Enhancing Rental Housing Options.

Policy 6.2 - Expand affordable housing options and encourage its distribution throughout the city and the region.

The associated actions are currently written as follows:

6.2.1 Strengthen, adopt and implement economic development and housing policies to require projects receiving public funds to provide 20% affordable housing to promote mixed income projects and preserve affordability in revitalizing areas. Expand the variety of sizes of affordable units to include larger units with multiple bedrooms suitable for families. ST

6.2.2 Present for Council consideration and adoption an ordinance prohibiting source of income discrimination, including discrimination against Housing Choice Voucher holders. ST

6.2.3 Develop, adopt and implement a new policy and guidelines for projects requesting increased development rights through zoning changes, to receive density bonuses in proportion to the number of affordable residential units provided. MT

6.2.4 Work with NCTCOG, adjoining jurisdictions, housing authorities and housing advocates to initiate a discussion on a regional approach to fair housing. Coordinate with Action 1.1.3. LT
But Crone says there needs to be more discussion about what the Supreme Court decision and other shifts in housing policy mean for Dallas and the future. "There's a difference between outlining the rules of the game as opposed to the game plan, how your team ends up succeeding and winning the game."

In a written response to TREC on Saturday, Rawlings directed builders to the City Council's housing committee, led by Scott Griggs. "I am confident that Scott will entertain your proposal of a working group and that he will listen carefully to input from all stakeholders, including our real estate development community. Griggs, the chair of the Council's Housing Committee, said on Friday that he hadn't yet seen the industry letter but that swift change is needed. "We're just putting all the low-income housing where the dirt's the cheapest, and it's perpetuating economic segregation in the city. We need to address this immediately."

This post has been updated to include Mayor Mike Rawlings' response to the TREC letter.

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Eric Nicholson
Contact: Eric Nicholson