City Journal

Julia Vitullo-Martin and Robert F. Wagner Jr.
New Hope for Old Projects, Vince Lane and the Revival of Public Housing
Vincent Lane leads the Windy City's renaissance in public housing.
Spring 1994

Vincent Lane, a smelter foreman’s son, grew up in a cold-water apartment on the racially segregated south side of Chicago, across the street from Wentworth Gardens, a public housing project. With its well-kept buildings, swimming pools, basketball courts, and pristine lawns, Wentworth was the pride of the neighborhood. Its working-class residents formed a real community, Lane recalls, one in which people watched out for one another. Equally important, they eventually moved on to homeownership, as was intended by those who conceived of public housing during the New Deal.

Today Vince Lane is chairman of the Chicago Housing Authority (CHA), the nation’s second-largest authority and, in the view of many experts, the most troubled. The huge, ugly projects he oversees concentrate and somehow enlarge Chicago’s most serious social problems. Lane faces tremendous obstacles as he tries to restore public housing to something resembling the Wentworth Gardens of his childhood.

He has implemented some much-praised innovative programs (training and hiring tenants to renovate CHA apartments); he has tried drastic solutions to dangerous problems (unannounced police sweeps for illegal tenants, weapons, and drugs); he has proposed controversial untried ideas (starting a boarding school on CHA property); he has reinvented the authority by introducing extreme decentralization (tenant management corporations that have taken operational responsibility away from the central authority); he has even converted once-abandoned lakefront public housing into luxuriously appointed buildings where moderate-income families paying higher rents live alongside conventional public housing families.

Lane has also become a national political figure. He is said to have been Jack Kemp’s favorite housing authority head and runner-up, behind former San Antonio mayor Henry Cisneros, to be President Clinton’s secretary of housing and urban development. He co-chaired the federal Commission on Severely Distressed Public Housing, whose 1992 report characterizing 6 percent of the nation’s 1.4 million public housing units as “severely distressed” spurred Congress to appropriate $700 million specifically for the most distressed housing.

The state of American public housing is grim and getting grimmer. In most big-city projects, average household income is declining. More than 80 percent of nonelderly households now live in poverty, and most households have incomes below 20 percent of the local median. Some two-thirds of nonelderly families in public housing are headed by single women, and 86 percent of these female-headed families with children had incomes below the poverty level in 1991.

The problems Lane faces in Chicago are even more extreme. More than half its public housing falls within the severely distressed category. The CHA’s 34,400 households have an average annual income of $3,500. They live in housing that is, physically, among the most notorious in the country. Many projects are overrun by ruthless, well-armed gangs. The gangs are so strong that they have been able to create “tunnels,” a phenomenon unique to Chicago. In order to allow for quick escape, gangs dynamite exits through concrete walls, linking apartments that appear normal from the outside, but are blasted hulks inside.

If Lane can succeed in turning things around in Chicago, then surely there is hope for public housing in the rest of the country. Further, many of the obstacles faced by Lane and other innovative public housing leaders are the direct result of laws and regulations imposed by Congress and the Department of Housing and Urban Development. By cutting back on these restrictions, the Federal Government could make it far easier for local housing authorities to make dramatic improvements.

Lane’s Challenge

In the 1950s, the heyday of federal public housing construction, most cities clustered a few concrete high-rises in isolated poor neighborhoods. Chicago, however, did things big. It demolished whole neighborhoods and rebuilt them with public housing. The State Street corridor is two miles of little besides public housing projects down the spine of the south side, including some of the country’s most often cited examples of bad public housing, the 95-acre Robert Taylor Homes. The State Street corridor has no neighborhood apart from public housing: almost no stores, few businesses, even fewer trees. The projects are isolated demographically as well. More than 91 percent of residents are black; three-fourths of those aged 25 to 54 are female. Less than 10 percent of Chicago’s nonelderly adult public housing residents are employed; most households depend on welfare.

When Lane became chairman of the authority in 1988, he found administrative chaos. In the previous five years, CHA had gone through eight executive directors and five chairmen. This tumult had followed 19 years of deterioration under real estate developer Charles Swibel, often accused of corruption in the Chicago press. Lane discovered the CHA books in shambles. HUD had been unable to conduct an audit for three years and was threatening to take over the authority. CHA wasn’t sure how many employees it had; many tenants did not bother to pay rent.

Lane hired outside consultants to put accounts in order, establishing payment and procurement systems where none had existed. He reorganized the staff, firing hundreds of people and redeploying hundreds more. He restructured CHA debts, particularly to vendors and contractors, negotiating many fees downward and extending payment schedules.

In rescuing the CHA, Lane drew on his background as a successful businessman. He is president of American Community Housing Associates, one of the largest black-owned real estate firms in the country. But he says that in his twenty years as a businessman, he had never seen anything like the deteriorated housing stock he now oversaw for the CHA.

Most public housing in big cities has been very badly maintained. While its original construction was largely financed by the Federal Government, localities were to pay for maintenance with rent money. Chicago was one of many that chose to barely maintain public housing. Part of the problem was the corruption and incompetence of the CHA, which was put into receivership by HUD in the 1970s. Part was racial politics. The projects were nearly all black, while those who provided services to the projects were white. “No matter what the emergency was, we couldn’t get it fixed at night,” recalls Richard Wade, a former member of the CHA’s board of commissioners and now a distinguished professor of urban history at the City University of New York’s Graduate Center. “The unions—electrical and plumbers—were all white. They wouldn’t go into the projects after hours—ever.”

As the projects declined, they went through the familiar cycle: deterioration in the buildings led to high vacancies, which in turn led to squatters and drug dealers replacing regular tenants. Conditions worsened even further, working families left, apartments were abandoned, and the cycle continued. “If you don’t fix the units, they’ll be turned down even by tenants on waiting lists, leaving the dilapidated units for the most desperate applicants,” says Lane. “We don’t want the most desperate applicants filling a building.” Many projects became so unsafe that CHA officials were reluctant to enter them and workers frequently did not show up for their jobs.

Many cities have simply given up on high-rise projects. St. Louis, Newark, and others have demolished many elevator buildings, vowing to build only low-rise in the future. But Chicago is stuck with the public housing it has. In 1987, Congress outlawed demolition without one-for-one replacement “Where would the current tenants go?” Lane asks. “We have to build the replacement housing first, and that’s going to take years. So we have to rehab what we’ve got, even if we don’t like it.”

Dual Solution

Lane speaks bluntly about the need to rehabilitate public housing socially as well as physically. “Our buildings have become warehouses for the poor,” he says. “If the Ku Klux Klan had set out to destroy black people, they couldn’t have done a better, more systematic job of it than this combination we have of welfare and public housing. We need more working people in public housing. We need the right role models to compete with the gangs and drug dealers.”

Lane put two of his problems together, using one to help solve the other. He saw in the need for building maintenance an opportunity to create jobs for his tenants. The CHA uses a large number of outside contractors; Lane rewards them for training and hiring residents and has them compete not only against one another but also against teams of in-house contractors.

Among the outside contractors is The Woodlawn Organization (TWO), which during the 1960s was one of Saul Alinsky’s most successful black-run community organizations. Lane comes out of TWO and believes in Alinsky’s grassroots principles, including the Iron Rule: “Never do for others what they can do for themselves.” This rule pervades Lane’s management style and provides the philosophical foundation of the Step Up program, which trains and employs public housing residents to renovate apartments.

This is not renovation in the sense of restoring something of high quality to its former beauty—these units have never been anything but ugly. The dreariness of the basic apartment unit is hard to envision for anyone who has never seen one. There are no closets, just indentations. No doors between rooms. Concrete and cinder block everywhere in the apartment so that it looks like the basement of a badly designed school. Sheet-metal kitchen cabinets. Low ceilings. Bad light. The apartments are desolate. Yet Lane’s trainees are restoring them as carefully as if they were nineteenth-century brownstones. “We’re going to make this baby look as good as it can look,” says one.

Lane’s belief that work is crucial to establishing order and community in his projects is consistent with the intentions of the Public Housing Act of 1937 (also known as the Wagner-Steagall Act), which established federal funding for housing the working poor. “The important distinction in our society isn’t between rich and poor,” Lane says. “It’s between the working and the nonworking, between the productive and the nonproductive. We want productive people in our housing projects. Poor’s not the problem. That’s fine. Nonproductive is the problem. That’s not fine.”

The most direct threat to the sense of community Lane remembers from his youth is the pervasive violence that has resulted in part from the proliferation of illegal drugs. Lane thought that only a dramatic, even stunning, show of force would have any effect against the drug dealers who had taken over many of the apartments in his projects. The result was perhaps his most controversial initiative, known as Operation Clean Sweep.

Fighting Crime

During a sweep, some two hundred people—housing inspectors, lawyers, police, security guards, and construction workers converge on a single building, unannounced, early in the morning. They search every apartment systematically for drugs and guns (the lease prohibits firearms) and for squatters. They issue identification cards to paying tenants and remove any others. They install a new 24-hour security system, including gates around the building limiting access to one entrance. The building is from then on guarded by CHA police officers and security guards. (Both jobs are open to tenants.)

The American Civil Liberties Union sued in 1991, arguing that tenants’ and visitors’ constitutional rights had been violated by warrantless searches and detention without cause. In 1992, the ACLU again sued, charging that the CHA had imposed unreasonable restrictions on visitors when it prohibited overnight stays by anyone not on the lease.

CHA lawyers entered into a settlement in which they agreed to stop the sweeps. But after two people were killed in separate shootings, Lane reinstituted the sweeps. When we asked him about the consent decree, he simply shrugged. “Lane is not beholden to the old liberal constituencies,” says one legal aid lawyer. “What does he care about the ACLU?” We asked a CHA official if the authority was worried about the litigation. “Oh, we take litigation seriously, but not because we think these court cases reflect the views of our tenants. When our tenants have a complaint, they’re far more likely to go to their alderman than call legal aid. And when they do, we hear from that alderman.”

Bill Wilen, an attorney with the Legal Assistance Foundation of Chicago, which has litigated against the CHA on behalf of tenants, criticizes Lane for insensitivity to civil liberties. “In his zeal to reform the agency he has shown a serious disregard for the rights of tenants.” Wilen says. “In Operation Clean Sweep, it’s just: come in, look around, no probable cause.” Also among Lane’s critics is the National Rifle Association, which threatened to sue over the CHA’s ban on firearms. “It’s crazy for them to be a proponent of the continuing slaughter of young black males in these communities,” Lane told the Chicago Tribune.

But Lane has won support from the Chicago Defender, a black newspaper, which praised the sweeps and Lane’s defiance, reporting that tenants in the 15 targeted projects supported the measures. (In Alex Kotlowitz’s book on two boys growing up in the Henry Homer projects on the West Side, the 11 year-old told his mother he hoped Lane would sweep their building. “I worry about dying,” he said. “Dying at a young age, while you’re little. I’ll be thinking about I want to get out of the ‘jects. It ain’t no joke when you die.”)

Wilen, too, credits Lane with being “the most innovative, the most dedicated, the most professional chairman the CHA has had in years.” But he says Lane should not have abandoned the settlement of the ACLU case, despite the shootings that prompted his action. “It’s at critical times that the rights of the people are most important,” Wilen says. “If you can get rid of rights when things are hard, what good are they?”

Everybody agrees, in any case, that the goal is safe and decent housing. Lane has resorted to desperate measures in response to desperate circumstances. But even longtime CHA antagonists are willing to listen to Lane’s proposals. “An important question is effectiveness,” says attorney Alexander Polikoff, probably the most successful litigator against the authority. “We’ve got to adhere to the Constitution, but if he could demonstrate that these measures were effective, that they were making the buildings safe, we might find ways—including large-scale consent—of approving the sweeps.”

Federal Roadblocks

One of the biggest obstacles facing Lane and other innovative public housing leaders is the web of federal regulations that constrain their efforts to change the way their projects are operated. Among other things, these regulations make it very difficult to achieve the socioeconomic integration for which Lane is aiming. He took the first step toward increasing the proportion of working families on his own, initially with neither money nor agreement from HUD, by initiating his employment program. But to make further progress, he must change the rent structure.

Legislation known as the Brooke Amendment, which was intended to keep public housing rents from rising too high for the poorest tenants to afford, requires tenants to pay 30 percent of their income as rent. This creates two perverse incentives: tenants on welfare are discouraged from working, since they would automatically forfeit 30 percent of their wages; tenants who do work have every reason to move out as their earnings increase and their rents rise to above-market rates.

This dynamic makes it very difficult for local authority officials to encourage those on welfare to work and, once working, to stay in public housing. In Omaha, housing officials have created a resident-owned company that manufactures windows and doors. The work has been so good that the company now sells to other authorities. But as the tenants’ incomes increase, HUD regulations threaten to drive them from the projects. An early attempt at encouraging public housing tenants to work was tried by Wade in Chicago: “We got U.S. Steel to agree to hire some strong young men from the projects. The men did very well. But they were working so their incomes went up. The regional office ordered us to evict them.” (Did the authority comply? “No, of course not. They were our best tenants.”)

Under former secretary Jack Kemp, HUD recognized the problem and agreed to let some authorities set three-year rent ceilings. Rents for working tenants would be fixed for three years, much like a private lease. Lane wants permanent rent ceilings, so that working tenants could “become permanent members of the community.”

The unusual experience of New York City points to other ways in which HUD discourages income-mixing in housing projects. The New York City Housing Authority (NYCHA) has long used a unique three-tiered system—one-third welfare, one-third working households, one-third elderly—that allowed it to maintain a balance in the number of very poor households it admitted while encouraging working households to stay. As a result, more than 72 percent of nonelderly public housing tenants in New York are employed, versus less than 10 percent in Chicago and 36 percent in Boston. The NYCHA has thereby achieved a degree of social stability that sets it apart from all other big-city public housing authorities.

But the Federal Government has, particularly in the past few years, pushed New York in another direction. Urged on by advocacy groups, HUD has pressed local authorities to give priority in filling vacancies to the very poor, including homeless families. Under Mayor Edward Koch, New York started to give in. In the mid-1980s, the Federal Government said it would stop paying half the cost of housing homeless families in hotels unless the city moved them into public housing ahead of other poor families. In 1988, the Housing Authority concluded a four-year agreement with the Koch administration to put two thousand homeless families a year at the head of the twenty-year-long waiting list. Some in the Koch administration, including deputy mayor Robert F. Wagner Jr. (one of the authors of this article), argued against this policy. Wagner was sympathetic to the plight of homeless families, but he believed it was unfair to help them at the expense of those on the Housing Authority’s waiting list, who are also poor and often live in unacceptable conditions. Wagner also correctly doubted whether the city would provide homeless families with the social services they needed to make the transition to permanent housing.

Today, some 8,000 of New York’s 180,000 apartments are vacated each year, with more than half the vacancies going to homeless families under the HUD directive. As buildings became more troubled, Sally Hernandez-Piñero, former mayor David Dinkins’s Housing Authority chairman, instituted rigorous screening procedures to check for criminal records, rent payment, and previous behavior in shelters. Still, the relentlessly increasing numbers of formerly homeless households mean that the NYCHA’s projects will inevitably become, as Lane puts it, “more economically isolated.” Ironically, as the Chicago Housing Authority, under Lane’s direction, endeavors to become more like the NYCHA, New York’s public housing will look more like projects in Chicago and the rest of the country.

Lane, however, may succeed in having it both ways. On February 15, 1994, he announced a plan by which he intends to convert a thousand Section 8 housing vouchers to develop supportive housing for homeless families. Under the plan, six Chicago developers will provide housing along with social services such as education, employment training, and child care. Lane says it is the first time federal housing vouchers have been used in this way.

Although helping the homeless is Secretary Cisneros’s top priority, racial integration ranks nearly as high. While mayor of San Antonio, Cisneros laid out his rationale: “We have the opportunity here to create Hispanics who have developed the American virtues of hard work, discipline, and decisiveness while retaining their traditional values of the extended family, deep religious faith, and that innate sense of compassion which makes politics creative. There is also the opportunity here for developing a new breed of Anglos who take on the Hispanic qualities of tolerance, compassion, and appreciation for human relations.” As HUD secretary, he has fought to integrate racially segregated projects, particularly in Texas. Says Lane: “Racial integration? That’s just fine. It’s OK, if they want to do it. Of course, I’m not waiting for it. This system—Chicago’s system—is never going to be racially integrated. I’m more interested in economic integration.”

But even if Cisneros made economic integration his top priority, he would have to battle a bureaucracy that is often hostile to the goal. “When you move below the secretary’s level and down through the ranks, you’ll find that HUD is unwilling to clear away the regulatory debris,” says David Gilmore, executive director of the Seattle Housing Authority. HUD regulations, for example, require buildings to be designed to low standards. “This limits our ability to do construction with the amenities you need to attract working families,” Gilmore says. “The bureaucrats at HUD hold dearly to the concept . . . because they don’t believe the poor are worthy of the same design standards as the rest of us.”

Blocking New Construction

While the Federal Government has frustrated efforts at socioeconomic integration of public housing, it has attempted to reduce the extent to which public housing projects themselves are segregated within poor neighborhoods. In 1979, HUD forbade building more housing in what it called “impacted” areas. This rule, however, has gone seriously awry. Finding new sites in “nonimpacted” areas is never easy and often impossible. New York City has thousands of vacant sites available for housing, but only a few nonimpacted sites. As a result, the New York City Housing Authority is in the process of destroying the Dome, a lovely community center and garden on Manhattan’s west side, because it is located on a nonimpacted site. It is doomed precisely because it was built in an integrated neighborhood.

Under current regulations, housing authorities, as in Chicago, are forced to hold on to grossly deteriorated buildings. They simply cannot replace them, since HUD regulations forbid new construction in the same “impacted” neighborhoods, and “nonimpacted”—that is, middle-class—communities are seldom willing to accept public housing. Thus, the Commission on Severely Distressed Housing urged that housing authorities be permitted to construct or rehabilitate replacement units in the same neighborhood that contained the original units.

In Chicago, the problem predated HUD’s prohibition against construction in “impacted” areas. In 1969, ACLU attorneys, led by Polikoff, won a ruling in Gautreaux v. Chicago Housing Authority that enjoined the CHA from building more public housing in black neighborhoods. A federal judge ruled that before any new housing could be built in a black area, seven hundred units had to be built in white neighborhoods. From this eventually came the “three-to-one” rule: three units had to be built in white areas for every one in a black area. “There was no land left in white areas,” says Richard Wade. “The ruling effectively killed public housing. We tried to get new housing in the suburbs. We made a lot of parks but no housing. Every time we got a site, they declared a park.”

The Elderly and the Mentally Ill

Another federally driven dispute involves housing for the elderly, which accounts for 20 to 25 percent of public housing nationwide. In the early 1960s, federal law opened up such housing to disabled tenants; in 1988, federal regulations redefined “disabled” to include the mentally ill. “What no one anticipated was that . . . psychiatric disabilities were the greatest demand,” says HUD’s Mary Ann Russ. As a result, many jurisdictions, including Milwaukee, Minneapolis, and Seattle, have large numbers of young disabled single males in buildings intended for elderly people. In some Seattle high-rises built for elderly residents, more than half of all tenants are now young people requiring special social services.

Because more than 80 percent of those on Seattle’s waiting list are disabled, routine turnovers of apartments will eventually result in many formerly elderly buildings becoming filled with disabled people. In the short run this is not an overwhelming problem for Seattle, which has a “very service-rich environment,” according to Gilmore. “Many of our buildings are still functioning well, even though we have a couple that are on the edge of control.” Less “service-rich” and more financially strapped cities, however, are already in trouble.

“HUD is reinstitutionalizing the deinstitutionalized mentally ill, but without the services,” says Wayne Sherwood, research director of the Council of Large Public Housing Authorities, based in Washington, D.C. Housing for elderly people is now developed, under HUD direction, as one-third true elderly, one-third conventionally disabled, and one-third young mentally disabled. “Who else in the United States of America is required to provide housing for such disparate groups?” Sherwood asks. Says Lane, “The lifestyles just clash here. Elderly people often want quiet, safe buildings. Young people want to have a good time, have their friends over late into the night. Both groups are unhappy. If the priorities emphasize housing the hard-to-house in existing projects, you’ll risk making the whole project, and the surrounding neighborhood, fall apart. Why are we doing this? Because HUD tells us we must.”

Under great pressure from protesting authorities, Congress said in 1992 that an authority could designate a project as “for elderly only” so long as no one is evicted. Yet HUD has, in practice, allowed no such designation because it has not yet promulgated the governing regulations. Milwaukee’s executive director, Ricardo Diaz, intends to go ahead anyway. “Congress gave the secretary of HUD ninety days to respond,” he says. “The ninety days are up. We regard this legislation as self-implementing.”

The Future

Public housing was born during the Great Depression, a time of despair and hope. In those days, it was seen as young, innovative, forward-thinking; it attracted the country’s best architects and designers. Richard Neutra, for example, designed Los Angeles’s Channel Heights Project, sited high above the San Pedro Harbor, in 1941. Frank Lloyd Wright designed one of the first and best low-income housing projects in Chicago.

Today, public housing is seen by many as dismal, tired, corrupt. But Vince Lane is one of several energetic, even charismatic, local leaders trying to bring about a renaissance in American public housing. (Richard Gentry in Richmond, Bob Armstrong in Omaha, and Jim Wiley in Washington State’s King County are among the others.) They all face a rigid antagonist in the HUD bureaucracy. Almost from its first days, public housing has been subject to excessively detailed and onerous regulations from Washington. Under the original United States Housing Authority, “federal design guidelines proliferated,” according to architectural historian Richard Plunz, “becoming more stringent, more abstract, and more rigid in terms of aesthetic imagery.” Every aspect of public housing has been dictated from Washington for decades. The results, for the most part, were disastrous. Chicago’s monstrous projects were no accident. “Those projects were carefully built to federal design standards,” Wade says.

HUD regulations bar most innovations from below unless the local authority head, like Lane, simply defies the rules. Yet HUD has been known to recognize the local character of public housing. When Boston’s housing authority went into receivership, HUD, cooperating with the court, granted the receiver extraordinary powers to revive the projects, enabling a return to local control. “We gave the Boston receiver a lot of latitude in civil service rules, labor negotiations, actions in reorganizing itself,” says HUD assistant secretary Joseph Shuldiner. “Without special powers, a receiver would just wallow around in the same political mess. Turnaround activities themselves require unpopular political actions that a receiver can take. But eventually, the authority has to be back in charge.”

A housing authority should not have to go into receivership in order to be granted the flexibility to reinvent itself. Authorities should have this freedom under normal circumstances as well. It is not enough merely to make modest revisions in HUD regulations or to consign major revisions to the waiver system, in which HUD must grant a special exemption for every innovation. Because HUD can always provide a good reason for every regulation, discussions of incremental changes will produce no significant reform. Thus, HUD should take a more fundamental approach: throw out all regulations (making exceptions for the housing authorities with records of incompetence and corruption) and then discuss which rules should be restored.

Public housing has some things going for it that it didn’t have a few years ago. HUD Secretary Cisneros cares about public housing and, in Joe Shuldiner, former general manager of housing authorities in New York City and Los Angeles, has appointed someone with substantial on-the-ground experience. Senator Barbara Mikulski of Maryland, who chairs the Senate Appropriations subcommittee that oversees HUD, is also a champion of public housing. But real reforms will only come at the local level.

Chicago is on its way to pulling itself out of one of the worst housing disasters in history, and Lane has garnered support even from his agency’s traditional enemies. “Where would we be today if we had had Lane instead of Charlie Swibel for 19 years?” asks Alexander Polikoff. “A hell of a lot better off. What we had was intransigence on issues of fundamental rights and obeisance to perceived political realities—and those realities forced us down a disastrous path. Vince is trying to confront those realities in a responsible and forward-looking way. He comes from the private sector. He’s a developer. He’s interested in the incentives of a capitalistic system. So what? Maybe incentives can be turned to advantage in the present context. I think what he’s trying to do is good public policy, and I support that.” The question is whether the Federal Government will free innovators like Vince Lane from the elaborate web of regulations that have, all too often, proven tragically counterproductive.

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