A perfect storm of economic and political factors is creating a homelessness crisis in Minnesota, with increasing numbers of families without a place to live, according to a new quarterly report by the Minnesota Housing Project. The “2 X 4” Report, published by MHP is just one of the many indicators that poverty and homelessness rates are bad and getting worse.
Families Hit Hard
According to the report, the number of homeless families in Hennepin County shelters has increased by 21 percent since last year and doubled since 2006, while Minneapolis and St. Paul public schools show an eight percent increase in 2010-2011 compared to the previous year.
According to Leigh Rosenberg, who wrote the report for MHP, the homeless providers she interviewed all said that homelessness was on the increase, showing a slow, ongoing trend. In addition, the families coming into to shelters are older than typical families who needed shelter in the past. Instead of young, single parent families, there more and more older parents need assistance, sometimes for families with two parents who are both unemployed.
The year-end summary produced by the Minneapolis Public Schools’ Support Services shows further how many children are affected by this crisis. According to MPS, 6,356 children and youth were identified as homeless and highly mobile in Minneapolis in 2010-2011, an increase of 11.1 percent from the previous year. Some 3,606 of those young people were enrolled in MPS, representing 8.3 percent of total MPS student enrollment. During the school year, a daily average of more than 1,800 students attending MPS were identified as homeless. According to the MHP report, 8,200 schoolchildren were identified as homeless in Minneapolis and St. Paul.
Causes for the Rise in Homelessness
“People who have been out of work have tapped out of all of the resources accessible to them,” Rosenberg said. “It’s very much related to the economy. Unemployment benefits are running out, and they’ve used up resources and tools.”
Another big contributor, she said, is the rising cost of housing. According to the report, 58 percent of Minnesota renter households with incomes below $50,000 paid more than 30 percent of their income for housing, and the average monthly rent in the Twin Cities have increased to $921, up from $902 a year ago. The residential rental vacancy rate in the Twin Cities is at 2.4 percent, a ten-year low. Additionally, the report states that this quarter, about 14 percent of non-luxury renters were delinquent in rent.
With the vacancy rate so low, Rosenberg said, landlords are “in a position to raise rents if they want to.”
Part of the cause of the rise in the rental market, Rosenberg said, is due to the foreclosure crisis, which made tens of thousands of families across the state move from owners to renters. Even though mortgage delinquencies fell to 5.6 percent, and pre-foreclosure notices were down, foreclosures themselves rose compared to last quarter, and many who were affected by foreclosures in the past few years need to be housed somehow. “They cannot buy a house,” Rosenberg said.
Additionally, there are extremely low numbers of new rental units being constructed in the last five years. According to Rosenberg, 2006-2010 had the lowest number of multifamily units being constructed in any five-year period for the last fifty years. Rosenberg said the low rate of housing construction has to do with credit drying up and capital becoming scarce, which put a huge damper on housing industry as a whole. The drop in construction also means construction jobs aren’t available. Monthly employment in residential housing construction averaged only 8,200 workers, a 19-year low for the time of year in Minnesota, according to the report.
Meanwhile, she said, Section 8 housing continues to have long waiting lists, sometimes with a 5-10 year wait.
Policies that harm the poor
Kenza Hadj-Moussa, Communication Associate for the Minnesota Coalition for the Homeless, said that homeless advocates are bracing themselves. “The last legislative session was really hard for everybody,” she said. “Right now the main concern is what is going to happen now that stimulus money is running out. It prevented a lot of homelessness.”
We’re in the second wave of the economic collapse, Hadj-Moussa said. “All these jobs have disappeared. Nonprofits have less money. Foundations have less money.” The second wave, which started about a year or so ago, was exacerbated by the budget crisis, which climaxed in the last session.
One thing that MCH is focused on for the next legislative session is taking a good look at the state’s welfare-to-work program. “For low wage workers, they go to the welfare office instead of the unemployment line,” Hadj-Moussa said. For a family with one parent and one child, the payout is $437 a month, or $537 for a family of three, an assistance level that hasn’t increased since 1986, she said.
Government policies have divided workers in two different categories, according to Hadj-Moussa. Higher end workers get unemployment compensation when they are laid off, but low wage workers usually don’t. Low-wage workers have to quit or are fired because of missing work for childcare or healthcare reasons, and that leaves them ineligible for unemployment compensation. Low wage workers “are the first to get laid off and the last the get rehired when the economy improves,” she said.
Organizations that work with the poor and homeless are heading for cuts in funding, too. “There are more cuts coming,” said Cathy ten Broeke, the Project Coordinator for the Office to End Homelessness. The compromise with the debt ceiling limit, which resulted in the Congressional “Super Committee” will lead to even more spending cuts. “We don’t know what that’s going to mean yet,” she said.
The tornado factor
In addition to unemployment and dwindling funding from the state and federal government, many are still feeling the effects of the tornado that hit in May. “The tornado displaced hundreds of households,” said Cathy ten Broeke, the Project Coordinator for the Office to End Homelessness in Minneapolis and Hennepin County. Eighty-eight of those families were sheltered by Hennepin County, and all but two of those have been re-housed, she said, but the county is still very concerned, because many people are still precariously housed. Some families have been living in homes that still have not been adequately repaired, and won’t make it through the winter.
“We believe over 600 rental units have been compromised,” ten Broeke said. “Some were majorly damaged, others needed attention. It depends on the landlord’s attentiveness.”
According to MPS, 326 children and youth have been identified as homeless and highly mobile as a result of the tornado, 73 percent of whom are African American.
The tornado’s impact was even greater because it affected poverty-stricken areas. In Minneapolis, half of the children who were victims of the tornado were already identified as homeless that past year, according to Hadj-Moussa. “We needed to just help people make it through the economic recession, but now going with tornado damage, resources for general homelessness are going to the tornado,” she said.