A reader takes serious issue with Portland’s ‘affordable housing’ project
My good friend and former colleague at the Portland Business Journal Jana Hughes has written a thought-provoking essay in response to my posts on the Madrona Studios project in Portland. To say we disagree about the project’s merits … Well, it would be correct, we do. Nonetheless, I thought her views were worth sharing with a wider audience. Jana dropped out at 14, left home at 16, and quit stripping when she found out she was pregnant (at 19). She spent the following 13 years working in offices, performing tasks that required progressively less “measured perkiness” and progressively more “critical thinking.” Jana’s paid tasks now require “decision making.” Her current project involves financing a degree in History and Economics, luring small birds into her backyard, and witnessing the teenage years of a kind, thoughtful and talented young lady she still calls roo. She occasionally posts at her personal blog.
Jana Hughes
Re: D.D. Cook’s recent post, “Portland’s affordable housing community raises the bar again.”
More like raising the barrier to entry, I’d say. It is so sad that the Madrona is good news. Bear with me, please.
Commenter Bob says, “Why not support a living wage instead of affordable housing? That way we aren’t ultimately subsidizing corporate profits.”
I have to ask: What do you consider a “living wage”? How much you are willing to pay for your groceries, your widgets, and your next tune up at a Jiffy Lube?
Whenever you talk about “raising the wages,” you are also talking about “raising the prices.” Yes, profits to corporations are large; they are capitalistic institutions, and their corporate charter is to maximize profits. Labor being the lion’s share of production cost, low wages make consumer prices lower.
(This is not the thread to thought experiment about what might happen to prices if health care costs were not part of the employers cost of production or a tirade on viva la revolution, citizen – as much fun as that would be, we live in this world right now, and we are constrained to its realities.)
When commenter Bob mentions that there are two separate issues at play here, welfare housing for those not working, and a place where a low wage worker can afford to live, I want to agree wholeheartedly.
I read the headline thinking that when Dan referred to affordable housing, he wasn’t going to be talking about subsidized housing. But I’ve run some numbers, and….. low income subsided housing and affordable housing for the ‘working poor’ are in this case, indistinguishable. That is why I have a problem calling this good news.
Let me explain by looking at the Madrona Studios. Can we agree that the market this project is aiming to serve is folks who would otherwise be sleeping under bridges with a bottle in their hands? Seems plain enough to me, since they’ve placed the detox center in the lobby (ok, ok, Dan- that’s an overstatement, the Hoopers detox center probably has a separate entrance, around the corner or something).
Still, the picture painted for me by these stories is one of someone moving from the detox center, steadily up the floors into their very own studio as their addiction comes under control. (Temptation to relapse with junkies all around at all hours is a valid concern, but I’m really trying not to digress.) Noble, and necessary- drunks under bridges are not good for general social welfare, giving them dry beds is ok with me.
How these homeless, crawling out of addiction folks will pay the rent on these units is, I imagine, via their disability checks or their section 8 housing vouchers. They will qualify for food stamps, and voila, no more dying in the streets!
There are undoubtedly enough people in these dire straights in Portland metro to fill the Madrona many times over. The building was falling into disrepair and blight, now it has a good practical use. So, great! This is a wonderful place to keep our unfortunates (ah, word choice) off the streets at night.
But let’s look from the perspective of the so-called “working poor.” Does this housing complex represent a benefit for the low earners who ARE working? I’ve run through some numbers.
The rents on these studios (Studios. a 10×10 room and a kitchen and a toilet, noise leaking in from all 4 sides) range from $400 to $490, depending on the view, utilities included. Let’s call it $450.
Income restrictions on the units put a max for single occupancy income at $24,500 per year. This pencils out to a full time worker earning $11.50/hr – good retail, basic services – a wage more difficult to procure these days than you might imagine, practically a kings wage to many.
But these lucky ones can live in a studio apartment for about 27% of their income.
Traditional wisdom used to recommend 25% of income toward housing (utilities included, which the Madrona provides). That recommended percentage has been upped to 33% by ugly long-term economic forces I need not detail here.
So our $11.50/hr. worker, after paying rent, will have a little over $1000/mo. left over (assuming 20% payroll deductions, about what I saw come out of my checks at that wage -after declining the luxury of medical insurance).
This could be that hard first step out of the poverty trap!
… $125/week for food, $100 month for a bus pass, $50 a month for laundry quarters… that’s a few hundred dollars left over at the end for savings, education, entertainment (Don’t they deserve a little fun? They are, after all, working hard for their dollars). But, oh, those nickels and dimes that add up, so quickly, under the mystery heading “incidentals.” (Heaven forbid an accidental overdraft at $35 a pop, again, I digress).
A frugal life, a careful life, but not impossible for a clean hardworking soul with some old-fashioned determination and drive.
To do so at the Madrona, however, they will still need to tromp through the lobby of a building that also houses a detox center. Poverty being relative, the way we compare and rank ourselves to our surroundings, these ‘working poor’ are no better off for their labors.
Remember – this is not a Walmart cashiers starting wage we’re working with. This is a Walmart department manager or pharmacy tech, an entry-level cna, or a technical support rep at the call center (in Beaverton). Those jobs may not require a 4 year degree, but they do require skills and knowledge, sometimes a certification, and represent what could, in an ideally distributed world be called a career- if only they would pay the rent and put food on the table.
But here’s the rub… these jobs pay $11.50 an hour. That is what they pay. They will adjust for inflation, and barely match the increase in the cost of bread, but that is what they pay because that is the portion of the cost of production calculus that these ’some skills required’ positions merit. We need people to do them, but raising their wage to $15 or $20 an hour would only spread the increased cost over everything they touch. They would be right where they are now, no better, maybe even worse.
What are their other options?
A craigslist search on ’studio’ with a max price of $490 returns only 55 results. Many of them are $150-200/week rooms – overshooting the $490 per month price tag, the rest are far away from the central city (Oregon City, Wilsonville — adding hours each day of commute time to that $11.50/hour job if it’s in Portland proper). None of them are lovely places to live. Shared bath kind of situations.
So our $11.50 worker is left to pay upward of half their income, maybe even more, for a place that makes them feel like they aren’t junkies themselves. Because you don’t work your ass off every day to have to step over angry lumps wrapped in blankets on your way out the door to catch that 6:15 bus.
I do not mean to disparage… too much… it really is a good idea to turn old useless hotels into places where people can stay dry at night. But when they put Hoopers in the same building the Madrona became 176 units of great news for junkies. That’s what it is, and that’s ok… but that’s all it is.
Charging $450 a month for housing the alcoholics does not do anything to move the cost curve of housing in Portland relative to wages. The cna’s and pharmacy techs and tech support reps that are just squeaking by are no better off.
That’s why, imho – saying this is great news for affordable housing is….hell, Dan, it’s just bullshit…. once you get over the ‘living wage for everyone’ fantasy and see the reality of what wages are compared to how much it really costs to live indoors, the price for housing the folks who are going to live at the Madrona still is too high.
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. . . And taxpayers pay the social costs of maintaining our apartheid/slave society, while corporations reap the profits.
Well, yes, $11.50/hour sounds more like a living wage for a single adult. Just pointing out that a living wage can be determined in a way that society can agree upon. One week’s pay would be $460 and that would make the monthly payment (principal, interest, taxes, insurance and condo fee) on housing worth only about $50,000, about a 400sqft apartment built on an inexpensive patch of land.
So, yes, if you house someone there who can’t pay at all I’d call that welfare. If you house someone there at a reduced rent/payment I’d call that subsidized housing. If you force developers to build these places in communities where they can make a bigger buck building single family homes I’d call that affordable housing.
But, here’s my main point, and I think everyone commenting gets it: Slavery is institutionalized in the US. Indentured servants, slaves, Irish, the European influx, and now the next wave of mass immigration, legal and illegal. American business has always demanded a large pool of easily-exploited labor and an institutionalized unemployment rate of no less than 4%. The fundamental solution to poverty in America is to limit immigration and to create a living wage and thus agree to a smaller economy overall. France, for example, limits its immigration, has a sustainable economy and has only 6.4% in poverty compared to the US with at least 14% in poverty.
What a great discussion — and I’m definitely, definitely glad to see some discussion about the distinction between “housing project” and “affordable housing.” I think terms like this got invented for a reason, and as time goes on and things get more institutionalized, it’s easy to lose track of the significant, important differences.
Here in SF I’ve been having discussions about the way people cut the corners to make their housing projects their permanent homes. It’s never simple, is it?
I hear all of the facts, statements and judgments of the previous two commentators, and still, I hear a more visceral and personal account of life and movement.
I believe we all choose to move life forward when we create, through our actions, new opportunities for ourselves and our lives. The issue I catch from Jana’s …words, speak to a more profound sense of accomplishment, in our human make up.
In the first commentators post he makes the statement, “As Bob aptly points out, hotels, car rentals, dinner for two at upper class restaurants are all things that low and middle-low income earners don’t need and/or use.”
As if the middle and low income earners look no further than their lot in life or don’t need to. hmmm,okay…
I hear, in Jana’s post, our inalienable right to believe that what we do, should have an impact on the forward movement of our life. To work and still exist at the level of the homeless and addicts is something that the “nobles” feel is still okay in our society.
I too call. “bullshit”. Why, I ask, do we still believe that getting “them” off our streets is more important than bettering the lives of those who are choosing to be contributing members of our society, no matter the level.
I remember in the past a system that work like this, They were called, Slave Quarters. And aren’t we really talking, Economic Slavery anyways? Another topic, another time.
Well spoken Jana… Thank you for giving voice to those, whose time lives and back’s, truly allow for those who can spend time in hotels, rental cars, and dinner for two at upper class restaurants.
Hi Bob and dtafs! Thanks for jumping in! Great food for thought you’ve offered.
Before I get too wrapped up in that head of lettuce touched by your 7 cent Mexican, or wonder what strata of workers deserve to eat in restaurants every now and then, I’d like to revisit my original point.
Calling the Madrona affordable housing is wrong. The Madrona is a housing project.
For what it is, a housing project for near homeless addicts, its wonderful news, and yes, dtafts, on that merit alone it is something to be commended. But to paraphrase what Bob said so well in his comment on Dan’s original posting, there should be a difference between affordable housing and housing projects.
I’ll refer you to this piece about the Madrona, written by Anna Griffin for the O.
http://www.solaroregon.org/about/news_folder/madrona-studios-opening-most-worthwhile-part-of-portlands-rose-quarter-renewal
You’ll notice that she never calls this ‘affordable housing’: “To move into the Madrona Studios, a rectangular box of an old Ramada Inn on Northeast Weidler, you must be homeless or nearly there.”
Where I get my tuft in a ruffle is when we lump hardworking, fully employed people who happen to be doing jobs that rest on the ‘no degree required’ scale in with recovering addicts and expect them to knead their soiled hats in their hands and whisper ‘thank you, sirs, may I have another?”
There should be a benefit to working. I am having a hard time fathoming that we actually disagree on that point.
Bob, you’ve provided a handy calculator and answered my direct question. You consider $8.73/ hr. a living wage for a single person in Portland, Ore. With 47% of take home toward housing, and a $53/week food budget. Really? Are you kidding me? That’s a lot of fast food down the gullet, and bound to up that medical cost pretty quick, don’t you think?
Well, heck, on that scale, my 11.50/hr. worker really is earning a kings wage!
Apparently, though, that princely sum doesn’t extend to being allowed to dine alongside their betters or take a few days rest and travel once a year? (for the record, Bob, there is quite a continuum you’ve quoted between dining in a decent restaurant every now and then and the luxury of keeping domestics) At what point does a person ‘need’ a vacation, dtafs? At what point do they deserve one?
I have to let you know, poor folk do eat out, not as often from white tablecloths, but cost increases do affect them as well.
And while you may not worry too much about those upper crusts who can afford to have their manors tended by crisply uniformed staff, I think they’re valid humans, so I tend to ‘worry’ about them, too.
So where we seem to diverge is on the realistic implementation and effects of ‘living wage.’ The question is one that is by no means settled, so on that point I’m gonna do my homework and come back for more real soon.
But again I would like to point out that we are constrained to the realities we live in; those being that we are in the midst of a recession and that wages are not likely to rise for a while. I’ll also note that Oregon’s minimum wage is already tied to rise with inflation.
Ultimately, though, the main point is just this, $11.50 an hour should afford a better quality of life than a housing project.
Hi Jana!
I don’t necessarily disagree with you. In fact, I would be we agree on alot of things. I too think that 11.50/hr should afford a better quality of life.
But I think that speaks to a larger problem, which is how people are compensated from bottom to top, especially in large(er) corporations. Which, is probably a topic in and of itself.
One of the problems long has been that household wages for low and middle class families stopped rising 20 years ago, and have since stayed almost stagnant. While cost of living has increased dramatically. And until we, putting on my business person hat, address that in a fair and equitable way, it’s not going to change.
So to that end, you’re right in that the realities of today will be the overriding factor that dictate where wages go tomorrow. Which honestly, is a shame. We make so much money in this country, yet it’s so concentrated at the highest levels, we ultimately shoot ourselves in the foot. We expect people to spend, but we find every reason not to pay them an amount that allows them to spend, then we find ourselves in a recession where spending is down and expect (at least, on a national, populist level) businesses to start hiring again. It’s just a never ending, nasty cycle.
However, I do see your point. And, I can agree with you on the idea that Madrona isn’t ideal. But, It’s a start and maybe, just maybe, other cities will take note and build off of the idea. Or further, maybe Portland itself will build off of the idea.
Thanks for your response. I honestly admit that it has been a long time since I have been in touch with what is going on in Portland, and it’s nice to have a chat about the goings-on in the region.
-Dave
In response to another comment. See in context »Bob hit the nail on the head. Jana seems to be making an argument with regards to middle and upper middle class people.
She needs to better delineate between necessities and wants. Sure, prices might increase a tad, but increase on what?
As Bob aptly points out, hotels, car rentals, dinner for two at upper class restaurants are all things that low and middle-low income earners don’t need and/or use.
Not to say they don’t go on vacations, or go out for the occasional dinner. But they don’t do these things annually, monthly, weekly or nightly. They do these things on occasion, in extreme moderation.
Being that I went to school up on the Bluff almost 15 years ago, I find the Madrona Project another great thing that the City of Portland has done. They should be commended for it and the people of Portland, one of the greatest communities in our country, should be thankful the city responds to these issues and finds creative solutions to not so easy problems.
You raise a lot of points, Jana. First, here’s a living wage calculator for Portland: http://www.livingwage.geog.psu.edu/places/4100559000. $8.73/hour for a single person and $16.49/hour for a single parent raising one child. Second, raising the pay of low-wage workers has a nearly insignificant impact on basic needs. Here’s the answer to the question “Do you know how much a head of lettuce would cost if it weren’t for illegal aliens?”: 7 cents more. Not a lot of money. However, for goods and services that are highly dependent on cheap labor prices would go up more. For example, a 30% rise in wages to restaurant workers would result in about a 10% increase in the price of a meal out, say $5 on an average dinner for two. A hotel room might go up $5-10/night. The impact would be hardest on those wealthy enough to eat out a lot, stay in hotels, and keep maids and gardeners. I’m not too worried about them. Meanwhile, the restaurant worker would now have about $500 a month of discretionary income whereas before he/she had almost none, enough to enjoy life rather than just tolerate it. Also, meanwhile, the low-income worker would rely less on social programs, the original point, and thus taxpayers would be relieved of a substantial tax burden. But what good is any of this to large corporations such as Denny’s or Hilton Hotels or Del Monte or McDonald’s or Armour Meats? No good at all.