Racial Equity and Homelessness

• Why is Equal Opportunity Important?
• Barriers to Equal Opportunity
• Consequences of Unequal Opportunity
• Strategies to Promote Equal Opportunity
• Footnotes

Why is Equal Opportunity Important?

Everyone deserves access to affordable housing and equal pay for equal work, and yet many people are denied these rights on a daily basis. Both of these factors impede one’s ability to live a full and productive life and they contribute to homelessness.

• 9.5% of King County residents (170,373 people) live in poverty and are therefore at risk for becoming homeless.^[1]
• During the course of one year in King County, over 24,000 individuals will experience homelessness.^[2]
• According to the 2007 One Night Count of Homeless Persons, at least 7,839 people experienced homelessness on this winter night in King County.^[3]
• An estimated 2,000 meet the definition of chronically homeless.^[4]

Lack of housing for any portion of King County affects each of us. Each year, millions of King County tax payer dollars are spent caring for the homeless people through our most expensive emergency services – 911, hospital emergency rooms, jails, mental health hospitals, detoxification programs, child protective services, and more. Overall, working towards ending homelessness will be less expensive for society and better for these individuals and families.

If we are truly committed to ending homelessness in King County, we need to examine the factors contributing to specific groups in our community experiencing this phenomenon at disproportionate rates.

Homelessness and income insecurity are social problems disproportionately experienced by people of color.

The embedded racial inequities in the housing and economic systems have produced an accumulation of advantages for whites while simultaneously disadvantaging people of color. Historically, we can look at policies and practices that have created and exacerbated the economic disparity gap, including the GI Bill, various legislation affecting Native people, various forms of housing discrimination and inequities in employment hiring and compensation practices.

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Barriers to Equal Opportunity

Housing Discrimination

Up until 1968, it was legal to discriminate against people on the basis of their race when renting or selling property in King County. Historically, these laws, policies and practices have negatively affected access to affordable housing for people of color.

Land developers, realtors, and neighborhood associations wrote racial restrictions into the property deeds in order to maintain racial segregation in King County neighborhoods.^[9]

Other forms of discrimination were more covert. Steering, for example, was the practice of realtors unofficially agreeing to not show houses in white neighborhoods to people of color, and steering white homebuyers into predominantly white neighborhoods. This resulted in confining black residents to certain neighborhoods.

In 1960, the Central District was home to 78% of the City's black population. Even though in 2000 this neighborhood housed just over 30% of the King County black population,^[10] the historical legacy of segregation has prevented land and homes in the Central District from appreciating at the same rate as more white neighborhoods.

In addition to housing segregation, historical discrimination in lending has negatively impacted communities of color.

The term "redlining" comes from maps which indicated minority geographic regions by coloring them red or drawing a red line around them. Banks and other businesses used these maps to deny loans, insurance or other business services to people in less desirable neighborhoods. Discrimination in housing toward individuals was outlawed in 1968 and discrimination in lending based on neighborhood was outlawed in 1977. The practice of redlining includes:

• outright refusal of banks to lend in minority neighborhoods
• procedures that discourage loan applications from minority areas, and
• marketing policies that exclude such areas.

These practices reduce the home loan options for people in minority neighborhoods and weaken competition in the mortgage market. This results in higher mortgage costs and less favorable mortgage loan terms.

In effect, racial redlining discourages people of color from pursuing home ownership.^[11]

Currently, the number of loan applications to people of color is proportionate to the racial make-up of King County; however, people of color are receiving sub-prime lending at disproportionate rates compared to whites.

• In 2004, Hispanic households were 2 times as likely and African-American households were 3 times as likely as white households to have a sub-prime loan.^[12]
• 69% of census tracts with the highest levels of sub-prime home purchase and refinance loans are in predominantly minority or diverse areas.^[13]

These types of practices prevent people of color from benefiting in the housing market to the same extent as whites and those in predominantly middle-upper class neighborhoods.

 In effect, people of color do not experience the same amount of economic accumulation that acts as a safety net to prevent homelessness or curtail intergenerational poverty.

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The GI Bill

After WWII, the US Government created a bill providing veterans with educational opportunities as well as home loan guaranties. This legislation enabled millions of veterans to obtain a college education and become first time home buyers. On the surface, these provisions extended to all veterans, but due to unequal practices in the lending and real estate markets, the majority of those who benefited were white veterans and their families.

The GI Bill in the context of legal discrimination in that era, created segregated, middle class, suburban neighborhoods made up of white families. This benefit catalyzed the process of wealth-building through homeownership for these families. In turn, they could then borrow from their home equity to send a first generation of family members to college, and this generation sequentially gave birth to today’s professional class.

African Americans and Latino veterans and their families did not have access to these benefits. They remained renters and were confined to segregated neighborhoods with poor infrastructure and lack of access to adequate schooling, health care, and social services.

Their next generation had far less academic preparation or financial resources for higher education. Those who did not have sufficient resources to move from these segregated neighborhoods find their families today in areas where ongoing disinvestment guarantees unequal opportunities – few jobs, poorly performing schools, vulnerability to criminal victimization, lack of health care, etc.^[5]

Due to implicit inequality in the implementation of the GI Bill, people of color had a great disadvantage compared to whites in their ability to establish credit, equity, and asset accumulation – all of which constitute the cornerstones for intergenerational economic stability.

Relocation Programs of Native Peoples

In the early 1950’s, the U.S. government paid Native peoples to leave their reservations and resettle in five main urban areas, including Seattle. The Relocation Act was legislated under Federal Public Law 959 in 1953 guaranteeing education, housing and jobs for Native peoples if they moved into urban areas.

One year later, these promises were abandoned and Native peoples, having lost their reservation benefits, could not return to the reservations. With no housing, no education and no employment, Native people found themselves homeless in Seattle and other major Western cities.

Simultaneous to these relocation programs, the US Congress passed a series of Termination Acts which stripped tribes of recognition by the federal government, including their right to reservation land and federal support. With increasing poverty on reservations Native people moved to urban areas seeking the promise of a more lucrative life in the city. They moved to cities with no financial resources, social support or understanding of a culture and way of life vastly different than what they knew on the reservation.

In addition to the appealing sounding resettlement programs, 25,000 Native veterans of World War II relocated to urban areas for economic opportunities.^[6] The Relocation Program operated for 20 years, resettling over 100,000 Indians and their families in urban areas.

As of 2004, over 164,000 Native American/Alaskan Native peoples live in Washington State.^[7]

Of those 33,000 dwell in King County and have a homelessness rate three times their representation in the general population.^[8]

 In effect, these policies, and many others, have created a disproportionate number of Urban Indians experiencing poverty and homelessness.

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Discrimination and Disadvantages in Employment

Seattle did not pass legislation regarding employment discrimination based on age, sex, race, creed, color or national origin until 1972. Before then, it was legal to refuse hiring a person, discharge or bar a person from a job, and discriminate in compensation or other terms of employment based on race. African Americans and Asian Americans were also excluded from most of the better paid and desirable jobs. Until World War II, even factory jobs were reserved for whites while most people of color were stuck in menial positions.^[14]

In the 1980’s, a shifting labor market away from manufacturing jobs occupied by people of color and other working class individuals towards a service-oriented and technologically-focused market demanding higher education and specialized training created a high incidence of unemployment for these groups. Furthermore, out-migration from urban areas due to de-industrialization particularly impacted people of color as their neighborhood infrastructure crumbled.

Unemployment affects all people, but due to the structure of the labor market, recessions affect people of color at higher rates. In part, this vulnerability derives from workers of color being overrepresented in part-time, temporary and low-wage work, and therefore, ineligible for unemployment insurance and health care benefits.^[15]

When a recession occurs, whites are more likely to receive unemployment benefits, and hence, less likely to fall into poverty or homelessness. Of course, income level and asset wealth also serves as a buffer for these risks.

When the racial income gap persists, people of color are forced to live pay-check to pay-check and are therefore unable to save any money for these setbacks. According to the table below people of color, especially African Americans and American Indians, are overrepresented in the lower income categories and underrepresented in the higher income categories.

Percent of total population by race in income categories

Income and employment disparities tell only part of the story. Wealth, that is assets and liabilities that determine one’s net worth, is the other piece.

Wealth cannot be underestimated as it is a vital component to a family’s standard of living. Wealth can allow a family to have consistent access to health care, education, safe and economically viable neighborhoods, and provide a safety net in times of economic hardships. Families with little or no wealth may be devastated by comparable economic hardships.

Homeownership is the most important asset for most families in the United States, and considering the barriers to equal opportunity already discussed, it follows that racial disparities exist for wealth as well.

Source: 2000 Census

In the 2000 King County Census, homeownership rates varied across race, with the white population experiencing the greatest percent of homeownership (68%) and blacks the least (37%).^[16]

The median value of homes in different neighborhoods sheds light on the racial disparities that have plagued the housing market in King County. In 2006, the average price per square foot of a home in South King County, the most ethnically diverse region in the county, was $166; while in East King County it is $264/square foot.^[17] As white families continue to increase their wealth through the increasing prices of housing in affluent areas and other avenues, people of color who own homes see less appreciation of land value or are unable to benefit from the housing market and continue to lose rent money to land owners. Over time, whites continue to accumulate wealth at far greater rates than people of color.

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Consequences of Unequal Opportunity

High Rate of Homelessness for People of Color

Homelessness does not affect all groups of people equally. People of color are much more likely to experience homelessness than whites.

In the 2004 Status Report on Hunger and Homelessness, the U.S. Conference of Mayors’ found that people of color make up 65% of all homeless persons staying in shelters and transitional housing programs nationwide, and yet comprise only 31% of the U.S. population.

Sources: U.S. Conference of Mayors (2004), Seattle-King County Coalition for the Homeless (2006)

Homelessness in King County paints a similar picture.

According to the 2007 One Night Count of Homeless Persons in King County, people of color represent well over half (58%) of the homeless population receiving services although they make up less than one-third (27%) of county residents.^[18]

Three Census racial classification groups are overrepresented in the homeless population in King County (African Americans, Native Americans, and Latinos).

• African Americans have the highest representation in the homeless population in King County of all communities of color, comprising 35% of homeless persons even though they represent 5.4% of residents in the County.
• The percentage of Native Americans (3%) who are homeless is 3 times greater than their share of the total population living in King County (0.9%).
• The percentage of Latinos who are homeless (10%) almost twice their share of the total population (5.5%).
• As a whole, Asians are underrepresented in the homeless population (4% homeless vs. 11.3% of total population), but this data could be confounded by the aggregation of all Asian groups into one racial category. It is likely that some Asian-Americans and Asian immigrant groups are overrepresented in the homeless population in King County considering the effects of embedded racial inequities. Unfortunately, few studies have been done that examine homelessness rates among the various Asian groups.

Further compounding the risk of homelessness for people of color, the unemployment rates are also higher for these communities.

Looking at the 2000 King County Census, the unemployment rates from highest to lowest were

• American Indian/Alaskan Native 11.1%
• Blacks 9.5%
• Multi-racial 6.8%
• Hispanics/Latinos 6.4%
• Asians & Pacific Islanders 5%
• Whites 3.9%.^[19]

If people of color are experiencing both homelessness and unemployment at disproportionate rates to whites, then access to health care, nutritious food, social support, and resources are also limited.

Source: Seattle/King County Coalition on Homelessness.  One Night Count (2007)

Disproportionate Rates of Poverty for People of Color

Segregation in the job market, under-compensation for labor and lack of accumulated wealth contribute to poverty rates higher for people of color than whites.

In 2000, King County whites had a poverty rate of 6.2%, a rate lower than every other racial group.

Poverty affects one’s mobility and prevents families from leaving high poverty concentrated neighborhoods. Poverty often continues to become concentrated in certain neighborhoods, as people who can afford to move out. Then business, housing, and infrastructure investments, decrease and more people move out if they can. The families with the least resources are left behind.

The intergenerational effects of poverty become an inheritance of unequal opportunities, including:

• under funded schools that do not provide the same skills for inner-city youth to be competitive in the job market
• lack of social capital and access to good jobs and job networks
• lack of education/college financing for children

Source: U.S. Census Bureau 2000

Overall, the disproportionate experience of homelessness and income insecurity by people of color in our community reinforces racial inequalities in other areas of life: health, education, safety, arrests, incarceration, and intergenerational disadvantages.

Without equal access to shelter, housing, and economic security, people of color are at greater risk for disparities in these various areas affecting one’s ability to succeed and for future generations to prosper.

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Strategies to Promote Equal Opportunity

A thorough description and analysis of the causes and correlates of racial disparities in King County’s homelessness was conducted in 2005.^[20] In this report, several recommendations were made to commence the undoing of racial inequities embedded within homelessness and income security. These recommendations center on increasing income, assets and access to affordable housing in King County for people of color. Another report focusing on housing segregation in Seattle provided some additional ideas to eradicate racial disparities in housing and homelessness.^[21]

Increasing wealth-building opportunities for people of color

Even if the racial income gap were closed immediately, it would take at least two generations for the wealth gap to close. While income equality is necessary for addressing the immediate needs of people of color, it is not sufficient to reduce disparities in homelessness or intergenerational poverty.

Asset building for people of color and low-income families cannot be underestimated as a means to ensure economic safeguarding and equity in wealth. There are local programs addressing this area, such as Individual Development Accounts (IDA) from the federal Assets for Independence Act, which is an anti-poverty tool to help enable low-income people to increase their economic self-sufficiency through asset development.

However, in practice, IDA programs only serve a fraction of families with few or no assets. As homeownership is arguably the most reliable way to increase assets, a new government-subsidized mortgage loan could prove effective in increasing homeownership among families of color.^[22] In addition, funding job training programs and promoting educational programs that prepare low-income persons for living-wage jobs are approaches to address more of the direct needs of those disproportionately affected by homelessness.^[23]

Increase decision making input in housing and development from people of color.

An initiative to train, recruit, and better support persons of color in upper level housing and human service management positions is being implemented in Minnesota with the ‘Changing the Face of Housing’ project.^[24]

Strategies include

• board and staff recruitment and retention of people of color
• education and training tools that assess institutional racism and organizational culture
• creation of high-level scholarship and internship experiences in affordable housing organizations for people of color

Increase availability and accessibility of affordable housing.

Encourage the development of affordable housing citywide through inclusionary zoning policies and dispersion of affordable housing sites.^[25] One necessary step in the de-segregation of King County is the expansion of subsidized housing outside of high poverty and racially segregated areas. If this is reinforced with channeling investments to currently distressed neighborhoods, then these community infrastructures potentially can be strengthened and social capital increased.

Addressing multi-generational disadvantage requires a multifaceted approach

There is no single answer to eradicate racial disparities in the homelessness population in King County. The recommendations included above are but a few ideas to continue this process. It will take a multifaceted approach addressing disproportional treatment in housing, employment and education in order to provide people of color with income stability to reverse the effects of being placed at a disadvantage across multiple generations.

Source: 2006 American Community Survey

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Footnotes