St. Paul forum targets gentrification with creative tax ideas

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St. Paul City Council Members Melvin Carter III and Russ Stark met with residents and community groups from around the Central Corridor to discuss measures to prevent gentrification as a result of the future Central Corridor Light Rail Transit (LRT).  Over two hundred community members attended the meeting at the Ober Community Center in Rondo, the neighborhood where a vibrant African community was shattered in the 1960s with the construction of I-94.


Three community groups sponsored the meeting, including Aurora-St. Anthony Neighborhood Development Corporation (ASANDC), the Metropolitan Interfaith Coalition for Affordable Housing (MICAH) and TakeAction Minnesota. At the forum, called “Rondo Matters,” the groups defined gentrification as “The process through which higher income households displace lower income residents of a neighborhood, changing the essential flavor of that neighborhood.” 


Bertha Givens, an elderly African American woman, spoke at the meeting.  She gave testament to her own experiences seeing what happened to her community in the 1960s and said she wanted to make sure that the light rail wouldn’t displace her community once again. 


Keith Swan, a young African American community member, said, “I hope we can get together as a family to make sure our community stays in their homes.” 


Another neighbor, Vicotri Vu, said, “Gentrification is an injustice to our people.”  He worries how his parents, who are low-income earners, will be able to afford their mortgage if property taxes skyrocket. 


18 year old Chariti Hicks teared up as she spoke of the Rondo neighborhood.  “I’ve lived here all my life,” she said.  “I don’t want to be displaced from my family.  I don’t want to be put out because we can’t afford it.” 


ASANDC, MICAH and TakeAction have embarked on the Save our Homes Campaign, which aims to get the city of St. Paul to create a fund for the partial deferral of property taxes on eligible properties.  In the Save Our homes proposal, residences one-half mile north and south of University Avenue between Prior Avenue and Rice Street could become homesteaded properties, where the homeowner would pay a predictable portion of the annual property tax bill (102% of the previous year’s property tax bill before special assessments) with the rest of the property tax paid by a special fund.   Upon the sale of the property, the homeowner would repay the amount paid by the fund for the three previous years, unless it is sold to a relative. 


The other part of the proposal would be for rental properties, and would stipulate that a landlord could be eligible for the program if they agree to voluntary rent control.  In the case of rental properties, the proposal states that when the property is sold, the owner would repay the amount paid by the city for the previous 10 years unless the new owner agrees to maintain voluntary rent controls for a minimum of 15 years. 


After listening to the Save Our Homes Campaign proposal, both city council members agreed that they are concerned about the possibility of racial and economic disparities that might occur with the introduction of the light rail. 


“We want to make sure that the negative impacts are lessened and the positive impacts happen,” Council member Russ Stark said, but he added that the tools at the council’s disposal are limited.  Local governments get most of their funding through fees and property taxes, he said, so “we don’t want to raise property taxes in one area to pay for reduced property taxes in another area.”  The challenge, according to Stark, is to find the right tool.  He’s interested in finding other alternatives to provide relief for those living in the Central Corridor area.  He said that tax credits to improve home energy efficiency can help individuals save money and stay in their homes. 


Council member Carter said that another option for older residents to reduce costs is through property tax deferrals for senior citizens. “We need to make sure seniors know about that program,” he said.  Carter also said that “We need a governor who’s going to support cities.” 


Ultimately, Carter believes the best defense against gentrification is a good offense.  “We want our community to be the first in line for the opportunities that the light rail brings,” he said.