Jobs or Housing? Historic South Central Residents Decry Feeling Asked to Choose by Billion Dollar Reef Project
THE NUMBER ONE THING that representatives from the “creative habitat” known as the Reef felt they had learned from engaging the community, the speaker told the more than 600 town hall attendees this past May 5, was that Historic South Central was “lacking a sense of place.”
To give the community that sense of place it was lacking, the Reef representative continued, the Reef’s developers were looking forward to providing South Central residents with places to go get dinner with the family or to have a cup of coffee. Important amenities like a grocery store, pharmacy, and bank. A bike hub that the community could access. Investment in a new DASH bus route and bike infrastructure on adjacent streets to enhance overall mobility. A plaza area that could host performances and be a place to hang out. An art gallery that would showcase art from local kids because “kids love to see their work” up on walls.
These amenities would “create a sense of place for the people in this room…” he reiterated, “for all of us to belong to.”
Place vs. Place-making
About half the people in that room – members of the South Central-based United Neighbors in Defense Against Displacement (UNIDAD) Coalition and their supporters – collectively shook their heads in dismay and, in some cases, disgust. This was language that danced around their concerns about displacement and the disruption of the networks that comprised the social and economic foundation of their community. It was also language that suggested the Reef would now be the one to define what “community” and “place” meant for the historic neighborhood they were moving into, not the other way around.
Worse still, these words were being spoken to members of a community that might just have the most powerful sense of place of anyone in the city, perhaps with the exception of Watts and Boyle Heights. True, they might be profoundly disappointed with the city’s long-standing neglect of their environs. But they have no shortage of pride in the neighborhood and the ability of its people to elevate culture, family, heritage, and community in the face of great disparity. That pride and the deep and enduring commitment so many in the room had to raising the community up from within is what has made South Central the unique place it is.
In describing the community by the sum of its amenities, or lack thereof, the representatives of the Reef managed to underscore how disconnected they and the project were from the neighborhood itself.
It wasn’t the smartest way to kick off a nearly three-hour public meeting.
But it was, at least, consistent.
Despite the approximately 100 meetings the Reef says it has held with members of the community, the line of thinking laid out at the town hall appears unchanged from when news of the $1 billion mixed-use project first hit the cyberwaves two years ago.
“SoLA Village [the project’s controversial name at the time] will be about place-making,” Ava Bromberg, head of operations for the Reef, had told the L.A. Times in 2014 about the 1,444 residential units, 208-room hotel, 67,702 square feet of retail/restaurant use, a 29,255 square foot grocery store, 17,507 square foot gallery, and 7,879 square foot fitness center planned for the 1933 S. Broadway site. “With the Reef, we are turning creative space into more of a community and connecting that community to the surrounding neighborhoods.”
South Central was an area not generally “seen” by investors, she had continued, but perceptions about its creative potential could change, much like they had around Chelsea in New York or the now-thriving South of Market tech hub in San Francisco.
To an urbanist or a livability advocate, that approach might sound like it hits all the right notes: increased density via the transformation of surface parking lots, improved walkability and bikeability, transit orientation (the Reef also sits adjacent to a Blue Line station), “place-making,” a rebranding that encapsulates a future vision for the area, space for the creative economy to grow, an underlying goal of community-building – the works. Not to mention the project proposes constructing a significant amount of housing at a time when Los Angeles absolutely cannot build it fast enough.
But to a lower-income black or Latino resident of Historic South Central – a historically disadvantaged community with the distinction of having the most overcrowded housing in the country – that approach and its potential ripple effects present a much more complicated and far less rosy picture.
Pitting a Community Against Itself
Leaning against the wall in the increasingly warm, standing-room only venue, I can hear UNIDAD supporter Fernando Espiritu starting to get into it with a member of the local Roofers’ union standing just to my right.
After listening to presentations that he felt sounded like sales pitches, Espiritu declared a video promoting a construction apprentice program to be little more than “propaganda.”
“You got something against construction workers?” the union member confronted him, offended.
He didn’t, of course.
Why would he?
As a South L.A. resident and organizer himself, Espiritu was aware that the jobs such a project might provide were desperately needed. One only need look at the blocks-long line that formed at a Vermont Avenue worksource center when it was announced the L.A. Rams were hiring to get a sense of just how many people in the area lack stable work.
The Reef’s promise of construction jobs via a 30 percent local hire program (union), permanent hotel jobs (union), retail jobs, financial literacy and jobs training programs to begin this summer, and low-rent “micro retail spaces” to be made available to local entrepreneurs – all of this sounds genuinely appealing to those who have been juggling more than one job or struggling to get their foot in a reliable door for much of their adult life.
Moreover, the union jobs represented a particularly tantalizing prospect – much of the housing going up in L.A. today (both market-rate and affordable) is being built by cheaper, non-union labor. By agreeing to use union labor, the Reef would not only be agreeing to hire local(ish), pay well, and shoulder higher construction costs, but they would also potentially be providing more employment opportunities to African Americans who have struggled to break into construction, and especially non-union construction.
None of this was lost on Espiritu.
Instead, his concern – and that of many of the UNIDAD supporters – was the cost of these largely non-permanent jobs in terms of the rising rents, rising costs of living, and cultural, social, and, eventually, physical displacement that tend to accompany such transformative developments in low-income neighborhoods [find the full report on the anticipated impact on Historic South Central here].
And it wasn’t even clear how many jobs the project might supply, permanent or otherwise. Larger grocery stores and pharmacies often do not hire local. Last October, ninth district councilmember Curren Price told ABC7, “We are talking about 600 construction jobs.” Speaking to the crowd at the May 5 town hall, that number had jumped to “2700 jobs during construction…all unionized.” While either jobs number is a win, the caveat that only 30 percent could be guaranteed to be local hire and that “local hire” was defined as being very local to the job site, living within a 5-mile radius of it, or living within the county left many questioning how many South Central residents would actually fill those spots.
Consequently, residents that had come to engage the developers wanted more clarity on the jobs front as well as more conversation about how to ensure that those fortunate enough to get temporary jobs on site (and their neighbors who did not) would not be priced out of their community once the project was finished.
But the forum was not set up to allow for that dialogue.
Instead, it pitted members of the community against each other by seemingly asking them to make the impossible choice between jobs and housing. And those battle lines appeared to have been drawn well before the meeting began.
Presentations were made by members of the councilmember’s office, local unions, and the Reef, only; the community was not invited to participate except via public comment. And when speakers laid out the community benefits the Reef was proposing, no reference was made to the benefits proposal and anti-displacement measures UNIDAD had been seeking dialogue on for some time.
The unions had been asked to come out full-force in support of the jobs the project promised. Community groups from around the ninth district appeared to have been given talking points matching the Reef’s power point slides so they could hold up signs in support of specific benefits the Reef was offering at appropriate moments (many left immediately after fulfilling that role). And it appeared as if no one outside of those select groups or the UNIDAD Coalition was made aware the town hall was happening – it received no mention in the councilmember’s newsletters before or after the event, it wasn’t on the Reef’s calendar, and it wasn’t plastered on flyers around the community.
Even the agenda handed out to attendees was antagonistic in tone. It announced the meeting would open with a “Welcome by Moderators and Agreements on Civility,” while the full bottom half of the agenda read much like a poster on a first grade classroom wall, laying out a lengthy list of civility dos and don’ts. Meanwhile, translation equipment was in short supply and the sound transmissions of those able to get a hold of headphones, some complained, were quite poor, leaving a good number of attendees out of the conversation altogether.
“Don’t let people come in and divide us,” Ron Gochez of Unión del Barrio addressed the room during public comment. Alarmed by the divisions that seemed to have been drawn along both occupational and racial lines, he argued that renters and workers were one and the same. “We’re not against workers.”
Gochez was right – it was unsettling to see community members who struggle under so many of the same burdens lining up against each other. And the absence of a platform for a more measured conversation only exacerbated the tension as the night went on.
I looked back to my right see if Espiritu was making more headway with one-on-one dialogue. He was now engaged in deep conversation with another pair of residents, at least one of whom was also a union member.
In contrast to the growing disunity in the room, they seemed to have reached some sort of understanding. After a quiet moment, the second union worker reached out to the first Espiritu had spoken with and, in all sincerity, asked, “But what about what he’s saying about displacement?”
Good Question. What about Displacement?
A lot of the people in this room, a representative of the Reef speculated as he began to lay out the project’s community benefits proposal for the crowd, were probably living in affordable housing units whose covenants were in danger of expiring.
Because of that, he continued, the Reef’s first priority would be to work with the councilmember to identify endangered covenants and to set aside funds to see those covenants extended. Other funds paid into the city’s Affordable Housing Trust Fund (AHTF), he said, would go towards other preservation efforts or the construction of new affordable units.
It was an approach to community benefits that Price was wholly in agreement with.
Because the project would develop surface parking lots and not lots currently occupied by housing, he told the crowd, he had been willing to look at affordable housing protections and new construction as opposed to demanding that affordable units be included in the project itself.
Given that “almost 1,000 [housing] units” had covenants that were in danger of expiring in South Central, Price continued, it was important that money be set aside to protect those vulnerable families against rising rents.
“That is what you call real displacement.”
On the side of the room in favor of the project, heads nodded in agreement and some vocalized support. From the other side came boos and a few shouts about gentrification and displacement.
The dissent might seem surprising given that, on paper, these are the kinds of the concessions advocates often dream about.
After all, it is pretty rare to have a private developer make concessions to a community, much less ones aimed at helping poorer folks of color continue to reside near a massive luxury development. It is rarer still to have a developer that is willing to not only dump a sizable amount – Price mentioned “millions,” but the exact amount was never specified – into protecting affordable housing but also agree to union labor, a local hire program, putting $500,000 into building a public bike hub and installing bike infrastructure on surrounding streets, giving the city $500,000 for a new DASH line to connect the area to downtown, setting aside small, low-rent commercial spaces for local entrepreneurs, and sinking unspecified funds into some of the programs mentioned earlier (jobs training, financial literacy, youth recreational activities, and health and safety) to be spread throughout the entirety of the ninth district.
But what sounds really good on paper can sometimes play out very differently on the ground.
While the concessions are a welcome start, if their purpose is to help shore up the area immediately surrounding the Reef so it can withstand the kinds of change a billion dollar project will surely bring, then they are likely to fall pretty far short of that goal.
Safeguarding affordability in the area is much more complicated than one might expect.
As a general rule, throwing money at the AHTF is a good approach when looking at the longer term. Since 2008, funding for affordable housing has dropped precipitously; currently, Los Angeles only sets aside about $26 million a year on it when it used to have four times that amount. There never was enough to properly go around in the first place, as it was, and the promise of cap-and-trade funds for transit-oriented projects unfortunately doesn’t begin to fill that gap. So, the more funds that can be tossed in the AHTF pot and put towards the construction of new housing with covenants that will last 50 years or more, the better.
But efforts to use funds to extend existing covenants, in line with the councilmember’s approach, have had decidedly poor results thus far.
For one, tracking the covenants for the approximately 68,869 affordable units housed in approximately 1,748 properties around the city has never been easy. Because funding comes from a mix of federal, state, and local sources, most units are covered by more than one covenant, each of which comes with its own set of obligations and expiration dates. Monitoring owner compliance with all those conditions (or other mechanisms, like density bonuses) can pose a significant challenge under the best of circumstances, and more so in cases where owners are absentee.
For another, when the city has attempted to engage owners on protecting affordability, profitability has unfortunately tended to win the day. At the time of a 2007 audit of the housing department, the city was struggling to see covenants extended for more than a couple of years at a shot. The pull of market rates, the audit concluded, was just too strong. Which is not terribly surprising, given how wild the housing market was just before the big crash. In the intervening years, however, it does not appear to have gotten any easier for the city to negotiate extensions for longer than one to five years.
The fact that covenants generally do not make it onto the city’s radar until they fall into the “at-risk” category – meaning they will expire within five years – is an additional limitation. Negotiations aren’t likely to be fruitful when an owner has plans in place to convert a property to market-rate condominiums years before a covenant’s expiration date becomes of concern to the city.
Negotiations are also difficult when affordable properties are purchased by developers who never had any intention of being stewards of affordable housing in the first place. Take the case of billionaire developer Jeff Greene as an example. He beat out local non-profit Esperanza Community Housing Corporation to purchase the (USC-adjacent) Rolland Curtis Gardens from the Union Rescue Mission in 2004. Eager to move in higher-paying USC students, Greene tried to weasel out of the protective covenants almost immediately. When that proved a dead end, he waited until the CRA covenant expired in 2011 to wage a two-pronged campaign of intimidation and neglect of the facilities to get tenants to leave of their own accord. This was illegal in addition to being despicable – when a covenant expires, the owner must give tenants a year’s notice of their intentions to convert the property to market-rate. But his tactics so unnerved long-time tenants that by the time housing non-profits TRUST South L.A. and Abode Communities were able to organize tenants and, ultimately, wrangle the pricey property from Greene’s dodgy hands, about half had already fled.
In the long run, having been able to negotiate an extension of a couple of extra years from an owner like Greene in an area like the one around USC would have done little for the remaining tenants, anyways. As UNIDAD neatly illustrated (above, right), a street just a few blocks north of Rolland Curtis Gardens had been almost completely converted to privately-owned student housing within just a decade’s time. That neighborhood-wide trend, accelerated by the arrival of the Expo Line, means that if the building’s covenant was just being converted to market-rate today, tenants seeking alternative affordable options now would probably not be able to stay in the area.
Tenants in affordable properties around the Reef are likely to be confronted with a similar situation. Extended covenants would be expiring just about the time that the property market in the area was picking up real steam.
And, as it turns out, there aren’t even that many at-risk affordable properties in the immediate area to rescue.
While the councilmember’s claim that nearly one thousand units were at-risk is somewhat true for the whole of the district – approximately 854 units were at risk in CD9 in 2013 – it is not at all true for the neighborhoods surrounding the Reef site (above, the Reef is located close to the uppermost left corner of CD9 – the area devoid of orange dots).
Instead, most of the covenants the Housing Element 2013-2021 listed as in danger of expiring are located north of USC and in the MacArthur Park area (see full inventory of at-risk units, here).
Certainly, the ability to stay in place of the 79 families occupying at-risk units (below) must be protected. All efforts should be made to both extend the covenants beyond five years and to acquire and build more affordable housing in the area.
Efforts to preserve affordability absolutely cannot stop there, however.
As has often been noted with regard to Boyle Heights, because publicly-funded affordable housing requires prospective tenants earn a minimum income and limits the number of persons that can share a particular space, simply providing more of it does not solve the problem. In Historic South Central, where overcrowding is the norm and the median income hovers around $30,000, you are looking at a significant proportion of residents who would not qualify for units offered to those earning 30, 50, or 80 percent of the Area Median Income (AMI) and/or who would have to ditch a few family members to be eligible.
Which begs the question: how will the approximately 4,500 low-income renters currently living in non-affordable housing units within a half-mile of the project be protected?
We are, in other words, right back where we started.
Let’s Try this Again: So, What about Displacement?
If displacement were just a physical phenomenon and as rare as our limited abilities to track it suggest, it might be easier to address. Instead, it is a multifaceted process that unfolds slowly at first, picks up steam with the displacement of local businesses and the existing culture, and, with the disruption of the social networks struggling families rely on for comfort, kinship, and help in tough times, ultimately becomes irreversible.
Which is why many of the residents concerned about displacement at the town hall were well past wondering how such a massive development like the Reef would impact the housing market in the area. They have already observed how the growth of USC and downtown has put pressure on low-income renter-dominated communities like University Park, Boyle Heights, and the eastern edge of Pico-Union/Westlake or “City West.” How much easier the pending replacement of the 6th Street Viaduct makes marketing Boyle Heights as the eastern bank of the downtown arts district. How quickly the cultural, economic, social, and physical presence of lower-income residents can be erased once main street businesses turn over in neighborhoods like Highland Park or Echo Park. And how concerns for the safety of USC students have resulted in greater harassment of area youth and even USC students of color by law enforcement.
What residents wanted to know was how soon it would be before real estate agents started needling commercial building owners to charge higher rents or seek higher-end clientele. How much would their already-tight budgets be strained by having to shop elsewhere for necessities once artisanal yoga replaced corner markets? Or once they no longer had a network of nearby family members and neighbors who could help with caregiving? And how soon it would be before the desire of better-off newcomers to feel secure resulted in youth of color being (even more) regularly stopped and questioned about what they were doing in their own neighborhood?
They also wanted to know what kinds of protections they might be afforded against abuse of the Ellis Act, which allows eviction of current tenants if the units are removed from the rental market for at least two years or demolished to make way for new housing. Use of the 1985 law jumped by 235 percent last year, with many of those properties having been purchased only a year prior by developers whose express purpose was to demolish them and construct pricier housing.
Ellis Act evictions have been creeping eastward, although they have not yet had a significant impact on Historic South Central’s housing market. That seems destined to change, judging by how the Act has been deployed around downtown and USC [see the L.A. Times’ map here] and how many of the South Central property listings have been described as potential investment buys or as conveniently close to USC or the fashion district (below). It’s a worrisome prospect in a community where 80 percent of residents are renters.
But don’t take my word for it. Staff in councilmember Price’s office told the L.A. Times in 2014 that the Reef project marked a great opportunity for the neighborhood to evolve as a lower-cost alternative to downtown. “Downtown has become very expensive. It’s no cheaper to live downtown in an apartment than it is on the Westside,” Rob Katherman, Price’s then-head of planning and economic development (before he was charged with corruption and resigned) said at the time. “I think this is a natural progression.”
With all of these pending pressures, the UNIDAD supporters at the town hall wanted to hear less about the extension of covenants and more about how the community benefits could be geared toward greater protections against eviction, enforcement of the Rent Stabilization Ordinance (RSO), a fund that could offer emergency rental assistance when residents struggled to meet the rising costs of living, and tenant outreach, education, and legal aid. Less about new DASH routes and more about how small businesses would be protected (commercial rent control, mitigation funds for losses, etc.), how anti-criminalization of poor youth of color might be worked into health and safety programming, how the needs of the district’s rising homeless population would be addressed, and how the Reef would bring the residents in as a partner in building an integrated community together. [See the full community benefits proposal from the UNIDAD coalition here.]
But each successive effort made by the councilmember and representatives of the Reef to dodge questions about whether affordable units would be included within the project site itself only seemed to reiterate that there would be no further dialogue on the community’s demands.
Better Neighborhoods; Same Neighbors
As the meeting dragged on and tempers flared, chants of “What do we want? Affordable housing! When do we want it? Now!” and “No nos vamos!” (We won’t go!) rang out.
Taking it all in, it occurred to me that, to the casual observer, this could seem like the ultimate anti-development protest – one aimed at holding a developer “hostage” to impossible and unreasonable community demands. Or (as often comes up in the comments on stories about gentrification and Boyle Heights) that the residents were racist NIMBYs (not-in-my-back-yard ninnies) who hated change and did not want white people moving into their neighborhood.
That observer would be very mistaken.
The demands are born from an understanding of how a history of discriminatory planning policies, disinvestment, and disenfranchisement created the very conditions that make the community so favorable to developers today.
Early in the 20th century, restrictive covenants imposed on the territory directly adjacent to the Reef – a box bound by Main to the west, Slauson to the south, Washington to the north, and Alameda to the east – meant that it was one of the few places in the city where African Americans were allowed to own property (at right). When the covenants were finally lifted and African Americans tried to move out of their now-overcrowded and poorly-serviced neighborhoods, gangs of angry white men would harass and threaten them and burn crosses on their lawns. In the 1950s, because even trying to pass through white neighborhoods was dangerous for black families, black “mutual protection” clubs evolved to respond to the systematic assaults. Some of these clubs later became the basis for the area’s gangs – a legacy that unfortunately lives on and shapes life in the area today.
Black flight, most notable after the civil unrest of 1965 and 1992 and the loss of industry jobs, meant that the neighborhood has since turned over and is now majority-Latino. The change in demographics seems only to have made it even easier for the city to continue to ignore residents’ needs and the deterioration of its housing stock. Even recent plans made to upgrade infrastructure in the area, like the mayor’s Great Streets plan to expand the sidewalks along Central Avenue, have happened without consultation with the very Latino residents who will be most impacted by the changes. [See our coverage of the battle over the Central Ave. bike lane here, here, here, and here.]
So, taken in isolation, the demands for community benefits might seem like a lot. But put in the proper context, they make much more sense. There are no empty spaces for developers to move into; there is no building in a vacuum. Developers can stake claims in struggling communities because of how badly those communities have been treated by the city over time and how hard both the city and the feds made it for communities of color to acquire wealth and stability via home ownership.
Which is not to say that developers have it easy, either. They will surely get a number of tax breaks, depending on the project, but the ever-rising costs of land and construction mean that they are having to build taller and/or more luxurious projects just to recoup their basic investment.
And since those more luxurious projects can deepen racial/class divisions and hasten displacement when sited in disadvantaged communities, unless something changes, we’re potentially looking at a more segregated Los Angeles going forward, not a more integrated one.
More troubling still, this project is happening along the Blue Line – a rail line heavily used by lower-income residents of South L.A. While transit-oriented development is an important step forward in building a denser, more livable, and more sustainable city, should transit’s boost to land values fuel turnover (as it has along the Expo Line), it could also limit access to transit of those who need it most.
Seen in that light, the community benefits UNIDAD was seeking dialogue on at the town hall seem pretty weak. Rather, they serve to highlight how few tools we actually have at our disposal to ensure our communities become more inclusive as they grow.
It was not an uplifting conclusion to come to.
As I made my way out of the meeting, I passed a sign held up by members of the UNIDAD Coalition reading, “Queremos mejores vecindarios con los mismos vecinos!” (We want better neighborhoods, with the same neighbors!).
It’s a refrain I’ve heard in just about every disadvantaged neighborhood where improvements in “livability” seem to result in an increasingly “unlivable” environment for the poor. It’s also a refrain I’ve heard from just about every disenfranchised community where long-standing calls for the city and investors to help the community help themselves have gone ignored. And it is a refrain I imagine we will continue to hear, as nothing I saw that night at the Reef made me think that dynamic had changed in a truly meaningful way.
It is a deeply unfortunate state of affairs because, at this point, the community is not only ready to partner with developers and with the city to create the best possible outcome for their neighborhood, they cannot afford not to.
As 31-year-old resident Sandy Navarro explained, her South Central neighborhood was already becoming unaffordable. Were she to be displaced from her current apartment, she would no longer able to rent in the community where she was born and raised. If she wanted to stay in South Central, near her family, her community, and all that she knew, she would have to fight to make that possible. And she was ready.
“I don’t want to [just] be at the table,” listening to the potential options that would determine her family’s fate, she declared, “I want to be in the kitchen,” cooking up solutions.