A rent subsidy plan I can live with

Chicago Sun-Times
March 17 , 2004

Affordable housing suddenly is on the legislative agenda in Springfield. And it comes not a moment too soon for the estimated 285,000 families in Illinois who spend more than half their monthly income on rent.

According to a report from the Chicago Rehab Network, 40 percent of renters in Illinois don't make enough money to afford a two-bedroom apartment--which means the burden of trying to find affordable housing increasingly affects the middle class. Teachers, police officers, government workers -- not to mention the clerks at Walgreens -- no longer can afford to live in decent housing.

Rep. Julie Hamos (D-Evanston) chairs the Illinois House Committee on Housing and Urban Development. This year is the first time in more than a decade that affordable housing issues have been on the political agenda in Springfield, she said, and she has been ''surprised and pleased'' to see the issue is drawing bipartisan support.

Three bills that would help those who have been left out of the real estate boom -- the folks who can't afford to buy and have to rent -- are pending in Springfield. Two are good for tenants and landlords alike. A third is well-intentioned, but inherently unfair to property owners.

The bill most likely to make it to Gov. Blagojevich's desk is the Federally Assisted Housing Preservation Act. Introduced by Sen. Iris Martinez (D-Chicago), it would make it easier for low-income tenants to buy their building if the owner decides to sell after his contract for rent subsidies ends. This bill would help most in gentrifying neighborhoods where rising market rents make it lucrative to sell to the highest bidder. Without this bill, the Jane Addams Senior Caucus estimates 30,000 units of low-income senior housing could be lost in Illinois.

This bill would give the tenants time to put together a deal and buy the building at the ''highest, best'' market price. It's a win-win bill -- it gives tenants one more chance to keep their homes and the real estate industry can live with its relatively minor limitations on an owner's right to sell, said lobbyist Greg St. Aubin of the Illinois Association of Realtors.

The real estate industry also is willing to live with a bill proposed by Hamos that would levy a $10 tax on all recorded mortgage documents to raise $30 million a year for rent subsidies. The bill is modeled on a Chicago program that spends $6.5 million to provide rent subsidies to 2,000 families.

''This could do a lot of good quickly,'' St. Aubin said. ''We know how to do it. It doesn't need infrastructure. It subsidizes existing housing.''

The Rental Housing Support Program might seem like a no-brainer, but the bill has been locked up in committee while legislators argue over the $10 tax, Hamos said.

''People talk to us about comprehensive tax policy and this is $10,'' she said, in obvious frustration.

Actually, for most real estate transactions, the total tax would be $30, since most property transfers involve three recorded documents: the deed, the new mortgage and the release of an old mortgage. But it seems like a small price to pay for such an important public policy program.

If that bill doesn't make it out of committee, there's always the third bill, which would amend the Illinois Human Rights Act to prohibit discrimination on the basis of income. In other words, a landlord who turns away a tenant waving a Section 8 federal housing subsidy voucher could be sued for refusing to rent to that tenant -- even if the landlord has never been certified under the federal housing program.

Not surprisingly, the real estate industry is much less keen on this bill. And, although I certainly sympathize with the need to expand the number of federally subsidized apartments available to poor families, this is not the way to do it.

Legislators would serve tenants and landlords better by creating the rent subsidy program. Yes, it creates a new tax, but it's one most people will pay only once or twice in a lifetime. And the public policy goal -- to help families find decent housing -- ought to be worth $30 to most of us.