David was more correct than he thinks. He now has the MCDA subsidy at $41,473. But his original figure was much more correct for the total subsidy per unit. What David forgot was to check the total subsidy of taxpayer dollars. Lets see now, we also have Empowerment Zone money, Hennepin County money, MHFA money, low income tax-credits, HUD money with several different programs (that little Bank in Iowa is one of them that disperses such money). I think it was estimated that the "Village" assembled almost fifty sources of funding to be completely financed. Of course most of the sources ultimately got back to the taxpayer. So David do not be modest, your first estimate was far closer than you seem to think.
But for the sake of argument lets look at only the $41,473. A $140,000 house gets a mortgage WITH a guaranteed first 30%. Cost to the City - nothing but a 5% or 10% escrow, which the City gets back. Lets say you escrow a whopping 15% (just to be safe) and set aside $5000 from that 41,473. This of course will give you a loan at about .5 to .75% less than Market on a thirty-year mortgage. Now lets pay down that loan to $110,000 for "affordable homeownership". On today's Market the monthly Mortgage payment for the family would be $590.50. That figure might change this morning at say 11:00 AM. It might go up or down by as much as $5.00 or $10.00. So for the sake of argument lets just call it $600.00 per month. In this situation a family now owns a house for less than the guidelines for the rent on a two-bedroom apartment under required "low income" housing guidelines. AND the City has saved $6,473 in taxpayer dollars. Now of course if you go after all those other pools of money you would have an even lower amount, but lets just leave it there for comparison. Now lets look at the tax creating benefit of that single-family house compared to an "affordable" rental unit. Just guess which one pays more per unit for property taxes. Folks, this is not idle speculation. The rates I quoted are in a number of Internet sites for anyone to find. The real magic is in how the politicians keep it hidden. For those who think such a program should not be set up for poor people, let's start looking at the "real" cost of keeping someone in poverty. Don't even consider the human suffering and decreased happiness and well being of the family. Let's just look at real dollars. How much does it cost for twenty years of subsidized rent? How much does it cost for increased medical costs? How much does it cost for other "social services"? How much does it cost per person to the criminal justice system for the average poverty stricken child who enters a life of crime? In these hard financial times, with budget cuts, "We" just cannot afford the luxury of keeping people in poverty. We need to help people out of it, and the best vehicle is "affordable" homeownership. The next thing is "concentration of poverty". There will always be a group of people who wish to, or need to, rent. Bill Cullen's suggestion of rent vouchers makes sense for that reason. It allows people the freedom to choose where they live and is far cheaper for taxpayers. More importantly it de-concentrates poverty and gives new opportunities for people. But lets go one step further shall we? How about returning to a system where individual small landlords are given a tax advantage if their property is not in an "impacted" neighborhood and they rent to a low-income person. We give such tax advantages and financing advantages to Large Land Lords. Most such advantages for Large Land Lords are designed to exclude small landlords. I wonder why? Could it be that Large Land Lords had a little more money and a lot more "influence" on the creation of those programs? Remember the largest industry in Minneapolis as well as most large cities is poverty, and business is good. All the above looks at only "Costs". It does not factor in the increased productivity of a child that is the product of a stabilized family. Keeping to the dollar and cents thyme only, how many more taxes will that child pay into the system over their lifetime? From a purely selfish stance, we just cannot afford the luxury of keeping people in poverty to benefit the Poverty Industry any longer. As a society we could not afford the social and moral cost before, but now as taxpayers we can no longer support the "Poverty Industry". We need to start some good old fiscal conservative revolution in this country. We Democrats have antecedents such as Thomas Jefferson; we need to get back to Jefferson's revolutionary philosophy. All men are created equal! They are endowed by their maker with certain inalienable rights! Among which is the pursuit of happiness! My question is this: How in hell are you going to be happy in poverty, when concentrated with other impoverished people and with no opportunity to get out? Homeownership is not the only solution, but it is the best one I know. It is one that has proven to work historically and personally. I came out of the service without a high school education and NO money after growing up on a sharecropper farm in northeast Arkansas, talk about lacking "lifeskills". I bought a house, and that house gave me the financial security to get a college education. That same duplex gave me the financial security to go to graduate school. That same duplex kept me from being on the street when Mr. Ronny Raygun suddenly made me overeducated and under employed for about a year in the early eighties. That same duplex gave me the where with all to leverage other investments. It's not a solution I made up, its one that the original builder of my duplex used and that gave me the idea of. Not very original but darned effective. Yes, Minneapolis history offers the answers right under the politicians' noses. If we could just get them to open their eyes and their minds! Jim Graham, Ventura Village >"We can only be what we give ourselves the power to be" - A Cherokee Feast of Days >"The people are the only sure reliance for the preservation of our liberty. We must not let our rulers load us with perpetual debt." - Thomas Jefferson TEMPORARY REMINDER: 1. Don't feed the troll! Ignore obvious flame-bait. 2. If you don't like what's being discussed here, don't complain - change the subject (Mpls-specific, of course.) ________________________________ Minneapolis Issues Forum - A City-focused Civic Discussion - Mn E-Democracy Post messages to: mailto:[EMAIL PROTECTED] Subscribe, Un-subscribe, etc. at: http://e-democracy.org/mpls
