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On May 15, the City’s Reparations Committee considered a memo that proposed using reparations funds for six different housing programs. The memo fleshed out the criteria for one of the programs, a Home-Buyer Assistance Benefit Program, which would provide eligible black households down-payment assistance of $10,000 to purchase a home in the west end of Evanston.
The memo was prepared by Kimberly Richardson, Interim Assistant City Manager, and Tasheik Kerr, staff member, taking into account input provided by residents in the last several months. “For Evanston, reparations are a means of addressing the wealth and opportunity gaps residents experience due to historical racism and discrimination,” says the memo.
Last November, City Council decided to deposit into a Reparations Fund up to $10 million in City tax revenues collected from the sale of recreational marijuana. Council also created the Reparations Committee and asked the committee to consider the viability of two recommendations: 1) housing assistance and relief initiatives for black residents in Evanston and; 2) various economic development programs and opportunities for black residents and entrepreneurs in Evanston.
Three aldermen serve on the subcommittee: Robin Rue Simmons (5th Ward); Peter Braithwaite (2nd Ward); and Anne Rainey (8th Ward).
A Focus on Housing
“Housing was one of the areas of concern that had come up in all of our discussions,” said Ald. Simmons. “It was noted multiple times in remedy recommendations from residents of Evanston.”
The memo lists six housing programs, which Ald. Simmons said were proposed by the community. The first two programs are a Home-Buyer Assistance Benefit Program (for new homeowners) and a Home Preservation Benefit Program (for existing homeowners).
Ald. Simmons said the percentage of black families who own their own home in Evanston has declined, and the percentage of the black population in Evanston has declined to about 16%.
She said the homebuyer assistance program and the home preservation program would not only help to retain black residents in Evanston, but they would also welcome back residents who left because they could not afford to live here. These programs would also provide an opportunity for wealth-building in the black community, Ald. Simmons said, adding that the median income of black households is $46,000 less than the median income of white households in Evanston.
The memo listed four other housing programs:
- A Home Rehabilitation/ Renovation Program for new and existing homeowners. This program would help people who are struggling to keep up with the maintenance of their homes, said Ald. Simmons.
- A Property Tax Distress Program for existing homeowners, with an emphasis on assisting seniors. Ald. Simmons said the assessed values of properties in certain census tracks are excessive, and “Our seniors are really struggling with the overhead of home ownership.”
- A Property in Foreclosure Counseling Program for existing homeowners. “Families are still losing their homes,” said Ald. Simmons. “This may be a result of a tax burden, a predatory loan that they were unable to recover from” or other factors.
- A Financial Literacy Program for new and existing homeowners and renters preparing for homeownership. People need to know how to manage their budgets, said Ald. Simmons.
Ald. Simmons added that the COVID-19 pandemic did not change the need for reparations. “We have to move forward with reparations in the way that we discussed,” she said. “The damages and disparities and the opportunities for redress still exist.” She added that the COVID crisis increased the need for reparations because the infection rate and the economic crisis was having a disproportionate impact on the black community.
“Our black community is still in recovery from the Great Recession in 2008 and the housing crisis, and we are now going to be further damaged by the income loss and the financial damage of COVID. We need to continue to move forward with this work, and home ownership is key.”
The Home-Buyer Assistance Benefit Program
Ms. Richardson emphasized that the proposal outlined in memo for the Home-Buyer Assistance Program was for discussion purposes only. “It’s not a final policy,” she said.
In general, the program is open to qualified home-buyers purchasing a property located within the West Evanston neighborhood. It must be occupied by the homebuyer as his/her principal residence. The down payment assistance in the amount of $10,000 would be provided at closing. The value of the property may not exceed the prior year’s median home sale price for West Evanston.
To be eligible, the proposal says an applicant must be a direct relative of a black Evanston resident who resided in the Fifth Ward between 1919 and an unspecified date; currently reside in the West Side of Evanston or have resided in West Evanston for at least 10 years and relocated to another area in the last five years.
One issue the committee discussed was whether the $10,000 would be a grant, a loan or a forgivable loan.
Ald. Simmons said she thought the $10,000 should be provided by the City at closing, and the City should be certain that the money was actually being used to purchase a home. “We also want to make sure that it’s not being used by folks as an opportunity to flip,” she said. She added that she did not want it to turn into a loan that would be repayable in full.
Ald. Braithwaite suggested that the amount could be a forgivable loan, with a certain amount forgiven each year. This might encourage people to stay in the neighborhood and increase neighborhood stability.
Nicholas Cummings, Deputy City Attorney, said if the $10,000 was a grant, it might be taxable income. To avoid that, he said, the amount could be structured as a forgivable loan, with a certain amount forgiven each year.
He suggested that the committee could obtain information from the Illinois Housing Development Authority to determine how they structure their loans and also consult with Sarah Flax, the City’s Housing and Grants Administrator.
Devon Reid, City Clerk, raised a different issue. He said if people are required to use the down-payment assistance to purchase a home in the West End of Evanston, the City would be continuing the pattern of segregation under which black people were segregated in the West End.
Ald. Simmons said the West End is the area that was redlined. She said, “I think that’s where our most appropriate remedy and investment is – in the area that was harmed, a community that was harmed.”
Ald. Braithwaite added, “It’s a place start.”
Ald. Simmons said the subcommittee’s work was supported by a memo, “The Case for Reparations” prepared by City Clerk Devon Reid; a redlining exhibit displayed at the Morton Civic Center and that the Equity Empowerment Committee sponsored in partnership with Dino Robinson and Shorefront Legacy Museum, and an article “Developing a Segregate Town, 1900 – 1960, appearing in the Evanston RoundTable, available here.