By Kylie Blovits
On Wednesday, October 2, hundreds of people marched from Laurel Park to City Hall to demand for Housing Now! — or more specifically, the long-awaited funding for the 40,000 units of affordable housing that is needed in Hamilton County, 28,000 of which is for Cincinnati alone (Community Building Institute). Seeing this shortage and consequences of it worsening everyday, the community decided enough was enough. If city government wouldn’t address the issue on their own, the people, organized by the Greater Cincinnati Coalition for the Homeless, would bring it to the discussion and hold the people in power accountable. And that was exactly the plan. The day and time of the march was set to align with the City Council meeting, a part of which is supposed to be dedicated for ‘public comment’, so that the community could air their concerns to their representatives and advocate for the basic human right of shelter. However, upon arrival, it was discovered that City Council had conveniently moved their meeting up four hours (2pm instead of 6pm as planned).
The doors were closed and no one was home. Apparently the community’s voices weren’t worth being heard.
Though one of the more recent examples, this was not the first time that the Mayor and the rest of City Council has turned their back on their ‘constituents’ in regards to the affordable housing crisis, specifically the people of Over-the-Rhine.
In June of 2002, the Over-the-Rhine Comprehensive Plan: A Consensus-based Plan by People who Care was published. This document, a product of a 5-year collaboration between the City Planning Department, City Council, and Community Members called for things like a more balanced housing stock, significant increases in affordable housing units, more homeownership, etc. In her book, Econocide, long-time resident and social worker in the Over-the-Rhine area Alice Skirtz recalls that “it became part of the larger City of Cincinnati Comprehensive Plan, intended to guide the city’s decision making, neighborhood by neighborhood.” Like the larger, encompassing City of Cincinnati Comprehensive Plan, the more focused Over-the-Rhine Comprehensive Plan was set to be managed by the Planning Department.
Everything was put in its place, teed up for a home run. But what happened? That was 17 years ago. Clearly, as evidenced by the Housing Now! March, the city of Cincinnati is experiencing an incredible shortage of shelter for its low-income residents. In fact, according to The Enquirer, there has been both a net loss of occupiable housing units (market rate or otherwise), as well as a dramatic reduction in the amount of affordable housing units (0-30% AMI) — from 3,235 units at the time that the Over-the-Rhine Comprehensive Plan was published in 2002, to 869 at the time of the last Housing Inventory.
What happened was then-Mayor Charlie Luken. Barely six months after the Over-the-Rhine Comprehensive Plan was adopted, the 80-year-old Planning Department was dissolved. Suddenly, Skirtz writes, the Plan “lost its administrative champion…[and] only resource for ensuring compliance with the Plan.” Shortly before that, Mayor Luken had also abolished the Economic Development Department. In place of both of these governmental, regulating bodies, Luken created two private corporations, so-named The Cincinnati Center City Development Corp. (3CDC) and the Port of Greater Cincinnati Development Authority, respectively. Both private entities have a Board of Directors composed of CEOs and other high-level executives which double-dip from many of the same Fortune 500 companies, such as: GE, Proctor and Gamble, North American Properties, Cincinnati Bell, Kroger, and more. While the latter, now interestingly enough run by the same Charlie Luken, works on development predominantly on the outskirts of Cincinnati, the industrial sector, and foreclosures, the former — 3CDC — was created to attack the heart of the city, or as they put it — “Build life in our City’s center”.
In contrast to 3CDC, though the Port Authority does feature corporate actors, there are also two community members and advocates on their Board, and furthermore — the organization is required to have open hearings and receive community input. 3CDC, however, has no community members on its Board and has no obligation to engage with the community or cater to them. And it shows. To date, only two projects on 3CDC’s website advertise units of affordable housing. The first, City Home - Pleasant Street, is for residents who can afford 50-60% AMI as noted on the 3CDC website. The second, Columbia Flats, has 8 (of 36) units for those at 80% of the Area Median Income (AMI). Moreover, according to Bonnie Neumeier, long-time resident and founder of Over-the- Rhine Community Housing (OTRCH): “Often times, 3CDC will claim the work OTRCH has done in affordable housing because they have control of resources that we’ve needed on various projects. When they have done affordable housing, it’s never 0-30% of AMI, it’s more close to 80% of AMI which is beyond the reach for those we serve.”
But no matter, affordable housing and the good of the original community was never the goal. As said on 3CDC’s website, Luken and the aforementioned members of the Cincinnati corporate community agreed that “the economic future of Cincinnati depended first and foremost on a strong and vibrant downtown business and entertainment district,” which required a “strategic focus” in the revitalization of Over-the-Rhine. And boy, was there strategy.
The first element of strategy was creating an entity that has essentially as much power in and over the city as a governmental body, but without any of the responsibility that a governmental body would have in upholding promises, policy, or morals as said entity is a private corporation. Not only does this immensely benefit the corporation, 3CDC, who can further their own economic endeavors using millions of dollars of the city’s money, assets, and tax abatements, but it also allows city officials (like then- Mayor Charlie Luken, now-mayor, John Cranley, and Council members) to yield results in questionable ways, all the while remaining politically correct by relinquishing responsibility —throwing their hands up, as if to say: “We can’t control what 3CDC does; they are a private organization and therefore independent from the city.”
But that couldn’t be farther from the truth.
The city of Cincinnati and 3CDC have been cut from the same cloth, inexorably linked, at times even synonymous. 3CDC was literally founded by the Mayor, and since then— has been considered the city’s exclusive and ‘preferred developer', as reported by Bizjournals. The transformation of the community of Over-the-Rhine is said to have “happened in a blink of an eye,” something only made possible by the ever-growing list of powers awarded to them by the city. Thanks to Cincinnati’s leaders, 3CDC, a supposedly non-governmental group, has “the ability to initiate regulatory reform, issue bonds, and use eminent domain [to acquire land],” says Skirtz.
Soon, public assets were surrendered to 3CDC, as well. For example, by 2005, 3CDC had a contract with the city for full planning, development, and management authority of Fountain Square Park for 50 years. Not long after that, 3CDC was given Washington Park for 95 years, no questions asked. Ziegler Park followed.
It wasn’t until a couple years after the Cincinnati Center City Development Corporation obtained Fountain Square Park that public awareness was raised about 3CDC’s power to grant or deny permits for public use of the park. In the spring of 2007, two groups, the Intercommunity Justice and Peace Center (IJPC) and the Homeless Youth Empowerment Council, were banned from organizing demonstrations and discovered that there was no real appeal process for contesting or negotiating these decisions made by the authority of 3CDC. It seems that in addition to control over the use of the public by public land, 3CDC also has power over human rights. In not one, not two, but three of the area’s largest public space.
And, therein lies the twisted beauty of the aforementioned mutually-beneficial relationship between the city and 3CDC. By privatizing public property like Fountain Square, Washington, and Ziegler Park, 3CDC, the managing entity has the jurisdiction to forbid behaviors or persons. If management resided with the city, as it was, they could not justly discriminate. In this arrangement, 3CDC and the city of Cincinnati can stick to the city of Cincinnati can stick to the ‘mixed model’ described in Econocide, “which was undertaken for purposes of promoting business and preventing use by certain so-called undesirable people and events.”
The people can’t challenge them, and apparently neither can other developers. As of this January, Downtown Cincinnati Inc. (DCI), a non-profit organization founded in 1994 to improve metropolitan Cincinnati, merged to become a subsidiary of 3CDC. WVXU reported Joe Rudemiller (VP of Marketing and Communications at 3CDC) chalking it up to a decision to increase efficiency: “The city just saw there were two organizations performing very similar functions.” Now there’s one less organization to stand in their way. That is indeed more efficient.
Furthermore, according to the Cincinnati Business Courier, in 2014 3CDC managed to find themselves in the position to “serve as a reviewer of proposals from third-party prospective developers and provide recommendations to the city.” Moreover, of the approved projects, “if redevelopment does not take place as planned, the property would revert back to city ownership.” So, essentially 3CDC gets to control all other development in the city, either vetoing or passing on whatever they like- which is both a gross conflict of interest and a very powerful, monopolizing role. And, if a third party project gets through, they can be taken over by the city, and by extension 3CDC if they don’t uphold the terms of the agreement.
Whether or not other developers are given the nod of approval, whether or not they succeed, 3CDC is in control. It’s a win-win-win-win!
In addition to being the filter and deciding vote for any potential development project, 3CDC was also granted custodianship of two private investment funds — the Cincinnati New Markets Fund (CNMF) and the Cincinnati Equity Fund (CEF). In 2004, when they graciously accepted this responsibility, the combined total amounted to nearly $100 million dollars. Since then, 3CDC has created two more funds -- the CEF II and CNMFII funds, from which they can play with a $36 million line of credit, according to a Drexel University study. Besides the $100+ million of development funds, 3CDC receives incredible amounts of tax incentives from the Community Reinvestment Area Commercial Tax Abatement Program (Commercial CRA), Tax Increment Financing (TIF), and the Ohio Historic Preservation Tax Credit Program. According to Mayor Cranley, 3CDC has received nearly $50 million from TIFs alone. Almost all projects are given full financial backing and forgo having to pay taxes for up to 15 years. And then some properties the city just basically donates to 3CDC. For example, as seen in the image below, 1409 Race Street was sold to OTR Holdings, Inc., a subsidiary of 3CDC, from the City of Cincinnati for $0.
With all this power, preferential treatment, and public funding being funneled into a private organization running parallel to the city government it’s no wonder why a citizen member of the Planning Commission thinks “the mayor’s development task force [is] a ‘stacked deck’ that is very heavily weighted toward developer interests.” It’s even less of a wonder since the former City Manager, Harry Black, had similar things to say. Less than a year ago, in April of 2018, Fox reported allegations about corruption in City Hall began circulating the media. Two days before his resignation, Black publicly accused now-Mayor John Cranley (political-mentee of then-mayor Charlie Luken) of “mixing his campaign fundraising with the city’s economic development deals.” According to WCPO, the firestorm surrounding the scandal included a threat to sue the city, persisting several months until finally the flames were suppressed- by money. Lots of money.