Incentives Are The Lynch Pin of Capitalism. In a growing area like Grand Rapids, builders want to build because people from elsewhere want to move there – for college, for jobs, to raise their family. Also growing because people who are already living there are having children – who want to go to college, find a job and raise a family.
Rockford, a hop skip and a jump north of GR, is a thriving growing suburban, mostly homogeneous, area. The company Rockford Construction has an incentive to expand to find more revenue; more profit, more jobs, better economy. If left to their own devices they could connect with wealthy clients of GR and provide the means for THEIR expansion, and market-value housing happens with a free-hand. Everyone expands, right?
The Rich Get Richer? Or…
If there’s not room, just buy out the competition: the current resident, which happens to have less money and then therefore less room in Grand Rapids. Maybe there’s room in Rentwood, err, Kentwood? Without another type of incentive business would be business and some people would lose, naturally.
The idea that your neighborhood is eaten and swallowed by upper income people wanting to move in is called gentrification. “The gentile” could argue that “the projects” do not help a city and of course, issues of white privilege, racism, classicism come into play. We are a country of majority rules, and minority rights. In this situation, the minority rights would displace the majority’s rule of their homeland.
“The Low-Income Housing Tax Credit (LIHTC) is the most important resource for creating affordable housing in the United States today,” says huduser.gov which tracks data about the projects funded through LIHTC. HUD would use data like this to prove that from 1987 – today lots of housing projects have been completed, lots of beds for lots of people who have been protects through this business incentive.
Without an incentive like LIHTC it would be in the best interest for corporations to put upper-income renters into buildings: more profit. The LIHTC subsidizes the rent for a lower-income individual to afford it, and enough businesses will go through the extra headache in their project to accommodate the red tape.
This Time Red Tape LIHTC For the Win
We have a golden opportunity in Grand Rapids to integrate the outsider and the insider, the privileged and the under-privileged. If it weren’t the LIHTC would it be something better to protect the lower-income class? The Feds could pay employers money that goes directly into the paycheck for individuals to afford whatever rent the builder wanted to charge? There’s lot of solutions to the problem, but the problem remains: the lower-class needs some protection and opportunity, too.