Racism in Housing: A Public Safety Crisis for Black Indianapolis

Historically, poverty and the resulting housing instability exacerbated by systemic racism and xenophobia have plagued Black and immigrant communities in Indianapolis. Multiple studies, including those cited by the Indianapolis Neighborhood Housing Partnership (INHP), declare that “secure, stable housing is essential for maintaining well-being across dimensions of physical and mental health...and the fall-out is multi-dimensional.”

These studies explained that low-income families may prioritize housing expenses over health care. They explained that children of low-income families with higher levels of housing costs generally perform worse on standardized tests and improved housing and neighborhood conditions promote educational achievement for families with young children. Minority and low-income neighborhoods were linked to “environmental inequity, too -- a higher risk of exposure to toxins like lead, asbestos, and mold inside and outside the home”. Researchers found higher stress levels for individuals in distressed neighborhoods that negatively affect mental and physical well-being. Realistically these symptoms of housing instability as an inherent element of poverty aren't a surprise to everyone. Universally-accepted models like Maslow’s “hierarchy of needs” lists shelter as an incredibly important physiological need right after food and water, but ahead of safety, friendship, self-esteem, and education(self-actualization).

Even the studies linking poverty to hopelessness and crime are so numerous and widely accepted that some elements of poverty have been addressed for the last 70 years as a public safety issue to prevent violence.

Until the mid-1960s a third of Indianapolis’ Black population resided in one contiguous area on the west and northwest side -- an area surrounded by polluted waterways and industrial sites. Born out of segregation, racism-induced poverty ultimately caused more people to be crowded into shacks, dilapidated homes and other substandard housing than the area could handle. Eventually the entire area was cleared for a highway, an expansion of two medical centers and a college campus, resulting in its inhabitants being dispersed across the city. Today's Indianapolis looks very different, as shacks, shantytowns and the appearance of third world poverty have been obscured by modern urban landscape. Some credit increased racial equity and integration as the reason for the decline and subsequent urban renewal projects. However, after considering the forced relocations and demolition of nearly all the historically Black neighborhoods on the old west and northwest sides, it doesn’t ring true. The reality is: the elimination of the most extreme appearance of poverty wasn’t the elimination of poverty, racism or housing instability in Indianapolis. Nor did it result in housing policies that significantly improved racial equity and economic opportunity for impoverished and lower middle class Black Indianapolis families. Today one-fifth of the Indianapolis population meets the Federal definition of poverty. Since society intrinsically links poverty to hunger, there are a multitude of programs to address short-term and long-term food needs. But when individuals lose their housing in Indianapolis, for any reason,it is difficult to find aid or even help moving their belongings.

One out of three Indianapolis (Marion County) households are rent - or housing-burdened according to a 2019 Indiana University Public Policy Institute report. “Rent-or housing-burdened” ”refers to” a household paying 30% or more of its income to rent or mortgage payments. This means that many Indianapolis residents and families are one financial crisis away from facing eviction or foreclosure. The study also found census tracts with higher concentrations of Blacks or Latinos tended to be the most rent - or housing-burdened. Much of this can be attributed to an almost entirely separate economy that many Black residents find themselves participating in: the Midwest is home to some of the most egregious racial wealth gaps in the country, and numerous studies show severe income disparities between Indianapolis’ Black and white communities. In fact, an Indianapolis Business Journal analysis of U.S. Census data shows that the average Indianapolis Black worker earns 56 cents on the dollar less than the average White worker in Indianapolis earns. To make matters worse, even though many of these rent burdened households qualify for Section 8 subsidized housing, relief stores are inadequate.

The Indianapolis Housing Agency's (IHA) Section 8 waiting list has opened three times in the last 16 years, the last time being in 2016. When it opened in 2014, 47,000 individuals applied for a total of 6,000 available slots. If individuals are lucky enough to make it on to IHA’s Section 8 wait list the average wait time is years, not weeks or months. This is likely due to years of public scandals, alleged mismanagement and threats from the Federal Government (United States Department of Housing and Urban Development or HUD) to take over the agency and systemic issues with it's own dwindling supply of public housing. Due to pressures on the system and data infrastructure challenges, IHA doesn’t actually know how many people are currently on its Section 8 waiting list.

IHA’s 2019 Annual Plan reported that it has less than 9,400 public housing units available, with only 668 units being owned by the agency itself. The rest of the units are owned by 2,000 +/- private landlords receiving payment through the housing voucher program. This is a HUD program that allows Section 8 households to take their housing subsidies to “willing landlords” who pass an inspection to insure quality and safety standards. Unfortunately, this process has been plagued by problems over the years, with certain landlords--residents say “slumlords” -- slipping through the inspection process and failing to maintain safe, healthy properties. Tenants report being afraid of speaking up about serious issues because Indiana law strongly favors landlords. In fact, Indiana is one of few states where tenants are legally prohibited from withholding rent in the case of habitability or health concerns. My interviews and conventional wisdom indicate that retaliation by landlords is common and in situations where serious issues haven't been or can't immediately be addressed by the landlord, the Marion County Health Department has often evicted tenants. And this problem hasn't been limited to just small property owners.

Owners of large apartment complexes have also received these locally-administered Federal dollars and in some cases became the worst slumlords, ultimately costing taxpayers millions. In 2007 the deplorable conditions of an apartment complex receiving hundreds of thousands of dollars from IHA were scrutinized after the murder of three year old Tajanay Bailey at the 328-unit Phoenix apartments described as “Indy’s Fallujah”.

When the Marion County Prosecutor toured the complex owned by a Connecticut investment group, he found cockroaches, mice, and mold, describing the complex as unlivable. At the time IHA was paying $50 million a year to private landlords from to house Section 8 tenants but were in near constant battles with many landlords over accusations they were neglecting the properties, defrauding Section 8 and in some cases the tenants themselves with illegal fees.

Oaktree Apartments was at one time a privately-owned 396 unit apartment complex spread out over 19 acres on the Far Eastside of Indianapolis that ended up costing taxpayers a lot of money. After a tornado in 2008 severely damaged 2 of the 28 buildings, the owners demolished those 2 buildings and patched the remaining aging buildings, pocketing the remaining insurance money. By 2010 it had fallen into such disrepair that IHA barred it from receiving any more Section 8 dollars. Soon after it was sold to a London investor who rented it out as slum housing to people who had few alternatives in the troubled Indianapolis housing market. After years of police runs, health department cases and inspections, the final tenants were evicted in February 2014 when near 0 degree weather caused pipes to burst and the whole apartment complex lost running water. The empty complex became a haven for squatters, violence and arsonists. From there, the City of Indianapolis spent years in a legal battle trying to force the out-of-state owners to either sell or demolish the site. The City finally finished demolishing the apartment complex in April of this year at the cost of $827490, and it may cost another $1.81 million to actually acquire it through eminent domain, on top of the previous 5 years of legal fees. In 2014 IHA was paying around $44 million a year to private landlords and discovered many lived in Australia, Canada, Israel, Germany, Hong Kong and Singapore and had bought properties with Section 8 tenants without their knowledge.

This situation was emblematic of a larger systemic problem of a local housing agency spending tens of millions of Federal dollars each year to house people in properties it neither owned nor directly controlled. It effectively made the system of public housing subject to the whims of landlords, with too little accountability. A relatively small number of landlords were receiving the lion share of taxpayer money, some who didn’t live in the country and many more who invested very little of it back into their properties leading to inhumane conditions and blight that eventually had to be dealt with by the taxpaying public, again and again. In the years since there hasn’t been much to believe the system has improved much, because IHA has been rocked by internal scandals, leadership changes, investigations and has fewer total public housing units now than it did nearly 10 years ago.

The reality is that most low-income Indianapolis residents never get to apply for Section 8 housing in the first place. They simply deal with what the market can provide. In too many cases the market supplies renters with housing with faulty plumbing, electricity, mold, flaking lead paint, missing furnaces and landlords who demand rent without fulfilling their obligations. Several families on my street have been exploited by bad landlords. In one situation, a landlord leased a freshly renovated century old home to a tenant without a furnace in early summer with the promise to install one immediately. The tenant had several school age children who stayed with him regularly. But by October, the landlord hadn’t made good on his promise, and after months of complaints about other problems and threats of withholding rent, the landlord finally just dropped off a furnace to the tenants porch for him to install himself. Without the skills and equipment to do it himself the tenant attempted to hire someone but found it was too expensive because the HVAC ducts were missing or needed replacement. He had no choice but to use space heaters to stay through the winter. But electric heaters are inefficient and the “renovation” that took place shortly before he moved in didn’t include insulation upgrades, air sealing, or even adding a “house wrap” typical of any standard renovation, so his electricity bills were astronomical.

Another one of my neighbors, this time a single mother of 4 kids on the next street was evicted when a health department inspection turned up water leaks and dangerous levels of black mold in the home. She was able to find another home in the neighborhood to rent and while the home was in much better shape the owner said he had plans to sell it shortly after she moved in. Interestingly enough he was willing to discuss selling it to her on contract, if only she would go on dates with him. Sadly these weren’t isolated incidents of landlords behaving badly, instead this was a common pattern of exploitation in Black and Brown Indianapolis neighborhoods that likely led to Indianapolis being #2 in the nation for evictions.

In 2015 the IndyStar reported Indianapolis had 6800 abandoned houses that were mostly being bought by investors,from government tax sales, with many being out of state partnerships. Two of those investors were former “Fox and Friends'' co-host Clayton Morris and local real estate agent Bert Whalen.The duo was accused of selling at least 700 of those Indianapolis homes to investors that Whalen’s companies would manage as rental properties. A later IndyStar analysis found that Whalen’s property management companies such as Oceanpointe racked up nearly 1800 code violations in 4 years and $700,000 in fines, most of which were not paid. Like many of the properties investors were buying, these were concentrated in predominantly Black or Black/Latino neighborhoods like Riverside, Haughville, Near Eastside and Martindale-Brightwood.

While Indianapolis isn’t as segregated as it once was, it is still one of the most segregated cities in America with most Blacks living in the north of downtown like all of the neighborhoods list, so this was no coincidence. Conditions for some residents were so horrific they slept in hotels or running vehicles during cold nights as they dealt with no heat, crumbling walls, collapsing ceilings, and sewage backing up, others had no electricity or water. In one lawsuit against Oceanpointe, a premature birth and subsequent death of the baby are blamed on the horrible housing conditions a resident suffered at one of their properties. But as these violations piled up against Oceanpointe and its subsidiaries, they still kept buying homes through county tax sales, with the local city-county government doing little to protect citizens.

Bert Whalen was finally indicted last November for defrauding investors in a ponzi scheme using Oceanpointe and these slum properties they were buying, selling, and managing.

However, before there was Oceanpointe there was Mt. Helix Real Estate Investment Fund which bought over 600 Indianapolis properties, racking up over $350,000 by 2015, not to mention and several other out-of-state companies acting in similarly bad faith but with no criminal charges ever filed.

From a public safety perspective, people in Indianapolis know they have little or no safety net and that’s a dangerous situation. It puts a large segment of the population in survival mode. If they have a bad landlord, many will bear it because they fear retaliation, eviction by the landlord or health department, and the very real possibility that their next landlord will be even worse.

Parents are working long hours on multiple jobs just to pay rent and hopefully shield their kids from those horrors. They have significantly reduced time to spend taking care of their own physical and mental needs let alone their children’s. Parent teacher conferences, educational attainment, and even behavioral problems just won’t be the priority of many parents struggling to keep a roof over their heads in the Indianapolis housing market. The stakes are high and households struggling to make ends meet, can’t save much for proverbial rainy day funds that the more affluent do. A setback like a car breaking down can quickly be a life altering crisis because the lack of a strong public transportation in the region means many can't get to work if they can’t afford repairs and they're soon out of a job, and then soon after that they’re behind on their rent.

Being only a single financial crisis away from eviction and homelessness is incredibly stressful and takes a serious toll on individuals mental health. It exacerbates mental illness and lowers the capacity of individuals to deal with all the other stress in life, including each other. It's a recipe for violence when one-fifth of the city’s population is in abject poverty, and one-third of the households are rent burdened and struggling to maintain a safe place to live. It's common for individuals to borrow money, throw rent parties, and cook meals to raise money for rent during a financial crisis. Unfortunately it's also common to see people resort to selling guns, drugs, and even themselves in the same situation. Black and Brown residents already dealing with the effects of systemic racism, redlining and other forms of financial discrimination don’t purposely choose to be renters and go through these horrors, truth is they never had a chance.

“Not everything that is faced can be changed, but nothing can be changed until it is faced.” - James Baldwin.

Today, we haven’t really faced the horrors that systemic racism has wrought on the Black community in Indianapolis, nor have we faced that ineffective policies and half-measures meant to address systemic racism continue to perpetuate it. Despite the glowing annual reports from various institutions and government agencies highlighting hundreds of millions of dollars leveraged for community development through grants, loans, tax credits, TIF bonds, and Opportunity Zones, it simply hasn’t resulted in a better quality of life for many Black and Brown communities. We’ve yet to face the truth that many of the housing initiatives that supposedly geared toward minority homeownership have resulted in Black homeownership in Indianapolis being lower now than it was in 1968. Likely because we haven’t faced the reality that the home mortgage industry and home loans as we know them didn’t even exist until the Federal government created it at the same time they created redlining to keep Blacks and other minorities from using them. We haven't faced the reality that bandaids don't fix everything and that racism in the housing market is exploited for greed and personal gain. And our public housing and community development policies continue to treat housing insecurity as a new temporary phenomenon that we’ve never dealt with before. We’ve yet to face the fact that as our housing and poverty problems have grown over the last decade, so too have our years of record breaking homicide rates, even before the pressures of Covid-19 existed.

Too many of our institutions and government agencies have continued to create new programs and initiatives as if it's logical to believe we can decrease violence, reduce the wealth gap, and increase educational attainment in the Black community while it fights to keep a roof over its collective head in a predatory housing market that has targeted it. These problems have existed over generations, spanning administrations and political parties causing untold suffering and death in the Black community in Indianapolis.

Our failure to treat fair housing as a human right for all people, in both policy and action has cost lives. But misery, desperation and need induced violence don't have to be the norm here - there are solutions. Consider a time in Indianapolis when a public housing project worked so well that it was systematically attacked by special interests in order to continue exploiting the Black community that lived there (Lockefield Gardens). There are a lot of valuable lessons to be learned from Lockefield Gardens that could be applied to community controlled land ownership models to create a sustainable, safer and more equitable future for Indianapolis.

Check out Part Two ("When Indianapolis Accidentally Did Public Housing Right") to learn more about Lockefield Gardens.

New America Indianapolis is committed to exploring economic and racial equity through community members' voices. If you have something to share, please contact Molly Martin. Have a reaction or response? Head to Twitter, find @mollygmartin and tag #NAIndyVoices.