Condos - high rents, displaced tenants and no action
Condominium conversions are sweeping through American cities — and nowhere more so than in Chicago. But changing in-town rental apartments to expensive condo housing brings problems with it — problems which the federal government prefers to ignore. Since 1970, the number of condominiums nationwide has risen from 85,000 to over two million. According to a recent Forbes story, the boom started, and continues, in Chicago, while leaving most of the rest of the state untouched. Nobody denies that converting older apartments to condominiums has its advantages. The U.S. Department of Housing and Urban Development (HUD) encourages such conversions as away of revitalizing the nation's cities. The Chicago administration actively backs such condo conversions. They improve the city's tax base, attract higher-income people, and spur devel-opers into rehabilitating older buildings or constructing new ones. Only in the 15th Ward is there organized opposition to conversions. But both HUD and Congress have notconsidered the problems accompanying condo conversion. Senate Banking and Housing Committee member Adlai Stevenson (D., 111.) has no position on the problems discussed below. And bills which aided some rental tenants evicted by condo conversions never made it out of a House Banking and Housing panel chaired by Rep. Frank Annunzio (D., Chicago).
Conversion problems
Problems raised by conversion of rental units to condominiums include:
• Relocation. Renters of units which reconverted often lose their apart-ments. They cannot afford the price of the condo on the new home market. Many such units are in redeveloping areas of the nation's cities, such as Chicago's North and South sides and Evanston's lakefront. Departing rental tenants are often low/ moderate-income wage earners or elderly.
• Speculation. As more buildings are converted into condominiums, the rise in their prices attracts speculators who are more interested in making money than in improving buildings. The bills buried by Annunzio's panel last year would provide rights for tenants in future contracts with builders. Such rights could deter speculation.
• Uneven development. Chicago, with a solid tax base, is enjoying a condo conversion boom. East St. Louis is not, despite lower land prices, favorable geography and a similar housing stock.
• Rising rents. The shrinking number of apartments combined with a rising number of apartment-seekers sends demand — and rents — through the roof. Many of the displaced tenants cannot afford more expensive units.
Displaced renters
HUD official Robert Gould claims the department is trying to aid displaced tenants. Gould outlined four HUD programs for tenants: "The 223 (f) program insures mortgages for refinancing or purchase of rental buildings; the 221 (d) (4) program provides funds for construction or rehabilitation of rental buildings; the 213 program finances mortgages for the same purposes for cooperative buildings, and the 202 program provides direct loans for housing for the elderly.
"We are trying to raise the number of rental units to offset the condominium conversions," he added. But he said there is no federal role in dealing with the other problems. The 1977 Housing and Community Development Act included some provisions protecting displaced renters, but little else. It said communities could form urban development grant (UDAG) proposals to attract private investment, help restoration or solve problems caused by losses of population and tax base. But it did not specifically allow UDAGs for study of condominium-caused displacement problems. The act also limited UDAGs to those cities which demonstrate they provide equal housing opportunity for low/ moderate-income wage earners. The famous Chicago housing discrimination suit (the Austin case) could hinder city efforts to attract such grants.
Private development
Only part of the problem — available land for new apartments — was discussed at a HUD-sponsored conference here in February. State and local efforts to make more land available for such housing, as a way of curbing the spiraling cost of buying a home or condo, were one topic. Speakers included high HUD officials and Chicago developer Hal Jensen.
Banking Committee hearings this year in both houses will not offer much insight on condo conversion problems. House panel aide Gerald McMurray says this year's hearings by his panel will focus on providing housing for displaced tenants, but not on the other issues. Senate panel aide Bob Malakoff says his committee received a HUD report in January on housing conversion. But the report will discuss only federal programs. "The open question, over which the government has no jurisdiction, is private development," he added.
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Names continued from page 32.
Springfield, as an administrative assistant.
Smith has been state treasurer the last two years. He was appointed by Gov. Thompson in January 1977 to fill the unexpired term of then-Treasurer Alan J. Dixon who resigned after he was elected secretary of state. Previously, Smith was Dixon's chief fiscal officer.
Walsh's immediate duties will include analyzing the office and recommending changes for improvements. He was executive aide to the commission of the Metropolitan Sanitary District of Greater Chicago. Heinecke will handle the community services program and public relations. Prior to becoming press secretary for Cosentino's campaign last August, Heinecke operated his own news service and formerly was a correspondent for the Chicago Sun-Times.
William B. Browder, Wilmette, as chairman of the Board of Higher Education, and Jane Hayes Rader, Cobden, as a member of the board, both by the governor effective February 1, pending Senate confirmation. Browder, a board member since August 1975, succeeds Donald Prince who resigned because of pressing business commitments. Browder is vice president, general counsel, secretary and director of Trans Union Corporation. Rader was appointed in December to serve out a term expiring January 31 left vacant by Dorsey C. Day. Her new term is for six years. Rader has served as an elected member of the University of Illinois Board of Trustees since 1973.
Charles P. Kocoras, as special assistant, by Director Joan G. Anderson of the Department of Registration and Education effective January 16. Kocoras, former chairman of the Illinois Commerce Commission, will assist in expediting cases concerning the quality of care and medicaid fraud cases. Kocoras succeeds Dan K. Webb who was appointed director of the Department of Law Enforcement in January. The position is part-time.
I. Otto Rhoads, Springfield, as manager of the 911 communication section with the Illinois Commerce Commission, effective December 1. Rhoads is responsible for implementing the 911 emergency telephone number system which is mandated to be completed by 1985. Stephen Aronson, New York, as a performance audit manager with the auditor general, effective late November. Aronson is presently involved in a management and program audit of the Fair Employment Practices Commission. He was senior performance auditor for the legislative commission on expenditure review with the state of New York for eight years.
Mark Krell, Chatham, as internal auditor for the Department of Agriculture, effective December 1. Krell, who was involved in corporate planning with Horace Mann for seven years, will be responsible for implementing internal audits for the director. Vivian V. Hickey, Rockford, as a member of the Commission on Mental Health and Developmental Disabilities, by the governor effective January 22. Hickey, a former state senator from the 34th District, replaced Mary Jeanne Hallstrom who resigned when she assumed responsibilities as state representative from the 1st District. The term expires June 30, 1979. Peter B. Fox, Champaign, as a member of the Lottery Control Board, by the governor effective January 23, pending Senate confirmation. Fox is replacing Mildred A. Bury whose term expired. Fox, whose term expires July 1, 1981, is president of Wendco.
Tony Leone, Springfield, as assistant chief clerk in the House of Representatives, in March when George Schoening retires. In the meantime Leone is on the staff of House Republican Leader George H. Ryan to learn the legislative process. Leone, who made an unsuccessful bid for Sangamon County clerk, has been a member of the Illinois Elections Laws Commission and the Springfield Election Commission. Dave Robinson, Springfield, as lobbyist for the Illinois Public Action Council (IPAC), effective in February. Robinson, former state representative of the 50th District, will lobby on legislation concerning utilities, insurance rates, property tax and health care. IPAC is a coalition comprised of consumer organizations, labor unions, taxpayer groups and senior citizens organizations.
Bill Carls, Edinburg, elected as state coordinator for American Agriculture of Illinois (AAI) in December. One of Carls first tasks was to help coordinate the organization's participation in a nationwide "tractorcade" to Washington, D.C. The basic goal of AAI is the economic improvement of farmers through parity.
Resignation
Dr. Paul Q. Peterson, Chicago, as director of the Department of Public Health, to return to teaching and research at the University of Illinois, Chicago Medical Center. He will remain with the department until a successor is appointed.
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