Extra, extra, read all about it: Homelessness is on the rise in the New Orleans Metro area
Actually, the announcement should not come as shocking news to anyone. It’s hard to miss, as homeless encampments grow larger and spread across the area. Our community’s homelessness crisis is painfully visible and beyond critical.
Still, Unity of Greater New Orleans announced earlier this month that homelessness in the New Orleans metro area is up 15 percent from a year ago, adding that the spike erased progress made in the first two years of the pandemic to reduce street homelessness.
Indeed, there were significant efforts bolstered by an influx of federal dollars to get homeless people off the streets and out of the clustered environment of shelters during the height of the pandemic to reduce the spread of COVID-19. It was a decisive move that served an important purpose – diffusing the homeless population to make social distancing more possible among those who lived on the streets or slept in shelters.
During the first two years of the pandemic, efforts to place the homeless in hotels and apartments reduced street homelessness by 34 percent. However, high rents, caused by pandemic-induced inflation, the growing gap between the rich and the poor that worsened during the pandemic, and the impact of Hurricane Ida in damaging apartments and driving up property insurance costs have triggered a reversal of progress on homelessness, said Martha Kegel, executive director of UNITY, which coordinates the efforts of other agencies that provide housing and services to the homeless.
The truth is that getting people off the streets does not really fight homelessness any more than the police prevent crime. And what those dollars and temporary pandemic-related programs did not address are the real drivers of the homelessness crisis in our community:
A Lack of Affordable Housing
Before traditional public housing in New Orleans was demolished, 10 housing developments provided more than 12,000 public housing units. At The New Orleans Tribune, we voiced our serious concerns in 1999 when the New Orleans City Council approved the Hope VI revitalization of the St. Thomas Housing Development despite vehement protests of residents at the time. Phrases like “de-concentrated poverty” and “mixed-income” were thrown around by wealthy developers as the answers to society’s ills while they were given the green light to convert the St. Thomas into River Garden. We raised our voices then, foretelling that it was the first step in pricing and pushing the poorest New Orleanians out of the city and with nowhere to go.
The fair-market rent for a one-bedroom apartment in New Orleans is now $1002 a month, an eight percent increase over 2022 – the largest annual increase since Hurricane Katrina, according to Unity.
In fact, some rents are much higher. For instance, at the Bienville Basin Apartments (formerly the Iberville Housing Development), a one-bedroom apartment is listed at $1275 to $1400, while a two-bedroom unit rents for $1457 a month, according to the complex’s website, which also indicated that applicants can only apply for the wait list for either unit size at the time. Located on the French Quarter’s edge, the community is priced well out of reach of low-wage earners who work in nearby restaurants, bars and hotels.
Today, the redeveloped public housing properties, which once offered 12,000 plus units now offer just over 2,000 public housing units, while another 2,000 plus units are rented at market rate. Today, a one bedroom apartment in what used to be the Iberville rents for more than $1,200 and as much as $1400 a month; yet some elected leaders and influencers, with their pious exaggeration, would have us believe that locally-owned short-term rentals are the culprit behind the affordability crisis. Don’t be fooled!
The razing of traditional public housing was disguised as an opportunity to improve the lives of public housing residents, when in reality, it was a land grab by private developers who benefited from tax credits and other incentives to build market rate housing and make all the money the law would allow, while pushing New Orleans’ poorest residents out.
A one-bedroom apartment is renting for as much as $1400 a month in what used to be a public housing development . . . no wonder people are sleeping on the streets!
Poverty, Low Wages
and Economic Inequity
By definition, market-rate housing refers to existing or planned development available, priced at a cost based on existing market values and demand. By definition, it ought to be affordable by residents without relying on any sort of subsidy or government assistance. In other words, market-rate housing is supposed to be based on an area’s median income.
To put it another way, if a two-bedroom apartment in the Bienville Basin Apartments rents at $1457 a month, the average worker employed full-time in the New Orleans metropolitan area ought to be able to comfortably afford to rent that unit.
So why has homelessness and the availability of affordable housing reached such a critical level in New Orleans? It’s the economy . . . duh!
To be sure, New Orleans’ affordable housing and homelessness crisis is as much if not more about low wages and economic inequity as it is about the available housing stock. New so-called luxury developments are being planned all over the place, but the folks who live and work in this city can’t afford them.
Consider that the prevailing standard for determining housing costs is the 30 percent rule, where an individual or family should spend no more than 30 percent of their monthly income before taxes on rent or mortgage.
Now, let’s apply that to an individual or couple renting a two-bedroom at Bienville Basin. They would need to earn $4856.66 a month or $58,280 a year before taxes to comfortably afford that unit.
Good luck with that!
According to the Data Research Center, in 2020, the median household income for Black households in New Orleans was $24,813, compared to $69,852 for White households, $55,616 for Asian households, and $38,487 for Hispanic households.
To be sure, homelessness in this city and country is steeped in racial disparity and inequity. While Black people barely comprise 13.6 percent of the U.S. population, they are 40 percent of the homeless population. So here, at The Tribune, we will not talk about homelessness without talking about income inequity, the racial wealth gap and systemic racism.
The most recent ALICE (Asset Limited, Income Constrained, Employed) report released by the United Way indicates that some 51 percent of households in Louisiana struggled to get by in 2021. The report contends that the heart of the problem is “a mismatch between earnings and the cost of basics,” such as food, housing, transportation and childcare.
Bingo!
Louisiana is the second most impoverished state in the nation. New Orleans ranked sixth in the country’s top 10 cities for income inequality in 2022, according to Forbes magazine. And according to WalletHub, the state of Louisiana as a whole, ranks seventh worst in economic racial equality. In other words, economic inequity and the racial wealth gap are deep and wide here, making affordable, quality housing out of reach for those who need it most.
Meanwhile, Louisiana still has a minimum wage set at the federal level of $7.25 an hour, a state legislature that refuses to raise it, and a business industry that lobbies vehemently to keep it in place.
Of course, many jobs pay more than the minimum wage, but still not enough on which to comfortably live and thrive. According to a ziprecruiter.com survey, 12 percent of jobs in New Orleans pay an hourly salary between $8.38 and $11.32. Another 28 percent of jobs in New Orleans pay wages between $11.31 an hour and $14.27. If the numbers are correct, it means that 40 percent of New Orleans wage earners make between $335 and $571 a week before taxes – not nearly enough to get wait-listed for a two-bedroom at Bienville Basin.
Void in Mental Health Care
Former governor, Bobby Jindal’s decision to refuse the expansion of Medicaid was a move that left thousands of Louisianans without coverage for mental health care, according to the American Mental Health Counselors Association. While a lack of affordable housing, poverty and low wages are the key drivers behind homelessness, the link between mental illness and psychological disabilities and homelessness cannot be discounted.
Under Jindal, mental health facilities in and around New Orleans were closed and state funding for mental health care decreased significantly.
For anyone wondering why this matters and what impact it has on homelessness, consider that people dealing with mental health problems are more susceptible to other drivers of homelessness, such as poverty. Often their ability to maintain employment and steady income is at risk without proper treatment.
An estimated 20 to 25 percent of the homeless population across the United States suffers from serious mental health issues, compared to roughly five percent of the general population. According to data collected by the Substance Abuse and Mental Health Services Administration, over half of adults living in permanent supportive housing either had a mental disorder or co-occurring mental and substance use disorder.
Data further shows that adults aged 65 and older who are homeless also have a higher prevalence of unmet needs for substance use and mental disorder treatment compared with their younger adult counterparts.
To be sure, when Louisiana, under Jindal, abandoned the mentally ill, it created more problems that only exacerbated homelessness in this area and across the state—problems that are manifested in the current homelessness crisis we face today.
So Here We Are
Kegel has said that homeless service providers in New Orleans and Jefferson Parish are struggling to counter the national trend of rising homelessness, which began in 2016.
“But the extremely high rents in our community now are driving more people into shelters and out on the street. Until our community develops an adequate supply of affordable rental housing and boosts the income of our fellow New Orleanians who are living in deep poverty, we are facing an uphill battle.”
According to Unity’s annual Point in Time count, submitted to U.S. Department of Housing and Urban Development in late April, 1,390 people were homeless during the January 23, 2023 one-night count—553 living on the street and 837 in shelters. During the February 2022 count, 1214 people were homeless; 364 were living on the street and 850 in shelters.
The numbers of people experiencing homelessness now are higher than they were before the pandemic. During the January 2020 count, 1314 people were homeless, with 555 living on the street and 759 living in shelter.
“The increase is devastating because homelessness is traumatic and life-threatening for the people experiencing it,” says Kegel. “All the progress our community made in reducing homelessness, particularly street homelessness, during the first two years of the pandemic has evaporated as the major forces driving homelessness overpower the resources currently available.”
And Unity’s numbers only detail part of the homelessness crisis. Its count does not consider the hidden homeless – people who are “provisionally accommodated” but are not counted because they are not accessing homeless services and support. While they aren’t living on the street or in homeless shelters, they are still improperly or inadequately housed in conditions that are unstable.
This may include individuals and families living in hotels and motels. It also includes those who cannot afford to rent or have no ownership interest in permanent housing of their own.
These are adults and families who stay with friends, relatives or sometimes strangers, but are not permanent residents of the household they are living in. They cannot make a significant contribution to their own housing costs and have no long-term stable housing plan of their own.
In housing jargon, this living condition, which masks the true depth of the homelessness problem, is called “doubled up”. In short, the place in which they reside is not theirs either through ownership or lease agreement. If not for the fact that they crash on a friend’s couch or make use of a relative’s spare room, they would not have a place to live. And while they probably make some contribution, such as utility bills or groceries, they cannot afford the cost of housing themselves on their own. Research published by Housing Policy Debate found that, in 2019, 3.7 million Americans, roughly one percent of the population, lived this way—technically housed, but effectively homeless.
What Are We Going Do?
We’ve pointed out three of the main drivers of homelessness—a lack of affordable housing, poverty and low wages and, unmet mental health needs.
Quite frankly until those three areas are addressed, we cannot build enough shelters or devise enough short-term solutions for homelessness in our communities.
The mismatch between earnings and the actual cost to comfortably live in and around New Orleans must be resolved. Common sense and equity have to win over profit and prejudice.
Plainly, $1200 to $1400 a month for a one-bedroom apartment in a city where the median income for a large segment of the population is under $25,000 a year is obscene and offensive. Hell, it ought to be illegal.
While the New Orleans City Council is busy placing limits on short-term rentals, it might want to consider an ordinance that puts a cap on what landlords can charge for rent in the city. This isn’t far-fetched considering that City Council members already believe it’s their place to tell people how they can use their personal real estate holdings. Allowing landlords of residential developments, many of which are built with tax breaks and other government-funded incentives, to charge rents that are far beyond what the average working resident can afford is dereliction of duty, if you ask us. If the City Council can make it impossible for a property owner to post a single-family house on Airbnb, it can certainly make it hard for a developer to rent one-bedroom apartments for $1400 a month.
If elected officials, business and community leaders want to address homelessness and affordability, they can start with living wages, setting market prices at rates that actually reflect the earning power of the community, and developing policies that curtail the gentrification that is inflating housing values and causing property tax bills to soar.
In the meantime, we all need to get out of our feelings. This “not in my backyard” posture is not going to fix our problems. Affordable housing has to be built somewhere. Shelters and transitional housing that help move homeless people off the streets and back into the mainstream have to be located somewhere. There is hardly a zip code in this city immune to the problem, and not one of them should be spared being part of the solution.
