Cover Story: Suburban renewal

In Cobb County, the poor are being bulldozed

In mid October, Kimberly Hunter, along with the other residents of Magnolia Crossing in South Cobb County, came home to letters on their doors telling them to vacate their apartments by the end of January. Their complex had been set for demolition.

“We’re not prepared,” Hunter said last fall. “Not with three months time. You can’t be prepared.”

Hunter, a mother of seven, doesn’t own a car. She’ll apartment hunt using CCT, the bare-bones transit system that serves sprawl-ravaged Cobb County. She doesn’t know where she’ll find the money to move on such short notice. She’ll need money for a moving truck ($50 for the truck, several hundred dollars if she hires movers), nonrefundable application fees ($50 apiece), a security deposit, and her first month’s rent. She must also continue to pay rent at Magnolia until she moves out.

Two weeks after being notified, she and other residents gathered at a community open house hosted by governmental organizations, including the South Cobb Redevelopment Authority, Cobb County Schools, and the Marietta Housing Authority. A handful of nonprofits and private apartment management companies were also there.

In a letter distributed at the open house, the South Cobb Redevelopment Authority explained that residents would receive between $250-$1,000 to help with the transition, depending on how soon they move out. But even with the money, many residents will struggle to find new homes.

“Their rent is way higher, a lot more,” Hunter says of other apartment complexes in the Six Flags area. “It’s not easy.”

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Magnolia Crossing consists of several bland two-story apartment buildings. Residents say it’s not exactly an idyllic place to live, but the apartments offered affordable housing in an area where it’s increasingly scarce. Eric Valenzuela says his neighbor was burglarized three times in two months. Magnolia resident Rashedra Pitts says that whenever she asked the management company about rumors of Magnolia Crossing’s imminent destruction, they would “deny, deny, deny” it. (Efforts to reach Magnolia Crossing’s management were unsuccessful.)

“For them to just try to spring it on everyone, it’s kind of messed up, but I expected it to happen,” Pitts says. “This place is horrible.”

Online reviews of Magnolia Crossing contain allegations of crime, bug infestations, mildew, and faulty electrical wiring. A fire once forced residents to jump from balconies to safety, with one person breaking an arm in the process.

Yet people still chose to live here for one reason: low rent — about $450 for an 840-square-foot one-bedroom, according to residents. At nearby complexes — even those lacking common amenities like swimming pools and gyms — the cheapest apartments of similar size rent for more than $600 a month.

“My heart goes out for my neighbors,” says Mattia Bolton, a Magnolia resident. While she and her husband don’t know where they’ll live next, Bolton says they’ll be OK because she and her husband have enough income to cushion their transition. But as for some of her neighbors, “If they were struggling to pay 400 and something dollars a month, moving is going to be a lot, a burden, and I can imagine there’s going to be some homeless,” she says.

In 2015, Cobb County Commissioner Lisa Cupid led a successful effort to pass a $10 million bond to fund Magnolia Crossing’s purchase and additional infrastructure improvements around Six Flags Drive. SCRA, the organization in charge of the bond issuance and redevelopment process, spent $3.7 million on the 120-unit complex in October. The Marietta Housing Authority is temporarily managing the complex. Once all the residents have moved out, SCRA will raze the apartments and put the 35-acre property on the market.

Cupid says she’d like to see the eventual owner put in a mixed-used development, complete with restaurants and a grocery store, capable of “revamping the area in a catalytic manner.” Despite the property’s proximity to Interstate 20, it might be a tough sell given the surrounding area’s 26 percent poverty rate and $36,080 median household income — much lower than the $56,166 metro Atlanta average.

In the mid-20th century, local, state, and federal officials across the country embarked on ambitious programs to clear homes and apartments to make way for interstates, stadiums, and other public works projects, all in the name of progress. “Urban renewal” policies, called “slum removal” by some, often had another, often unstated purpose: to eliminate areas of concentrated poverty, not through better services or outreach, but by dispersing residents to parts unknown.

The city of Atlanta’s urban renewal policies leveled the homes of thousands in the 1960s in Downtown neighborhoods with the promise of economic development. But for the residents able to remain in the surrounding areas, the revitalization never materialized around the new highways and stadiums.

A half century later, elected officials in Cobb County have taken a page from that playbook to practice their own form of suburban renewal. They hope that by firing up the bulldozers, they’ll pave the way for economic development. The previous efforts should give them pause, however, because prosperity has not always followed demolition.

Cobb County, particularly the more affluent areas of Vinings and East Cobb, conjures images of McMansions with manicured lawns, upscale strip malls, and new grocery stores. The area has long been a draw for well-off families looking for large homes, low taxes, and excellent schools.

But in the last decade, Cobb County has experienced some dramatic demographic shifts. The poverty rate has doubled since 2000 to 12.8 percent, and the county has become more racially diverse, with its percentage of white residents dropping from 95 percent in 1980 to 64 percent today.

A number of factors have contributed to the changes, including rising intown housing costs, large numbers of immigrants settling in the suburbs, and the demolition of the city of Atlanta’s public housing.

The number of affordable housing units hasn’t kept pace with demand in Cobb, in part because suburban counties have historically favored zoning for single-family homes over multi-family, and large lots over more affordable smaller lots. Cobb, whose population has more than tripled since 1970 thanks to homes generally priced for middle-class families, now has one of the lowest amounts of affordable units available to impoverished households in the country.

A shortage of affordable housing is a nationwide problem, according to the Urban Institute’s Erika Poethig, with only 28 affordable, available, and adequate housing units for every 100 extremely low-income U.S. households, defined as a family of four earning $20,000 a year.

“Supply is not keeping up with demand,” Poethig says. “That is a problem that if I zoom into Cobb County will come up in sharp relief.”

Since 2000, the number of affordable units per 100 Cobb County households dropped from 21 to 9. In an Urban Institute housing study released last year using 2013 data, the most recent available, Cobb and Gwinnett tied for second-worst ratio out of the country’s 100 largest counties. DeKalb was close behind. (Cobb ranked dead last in the previous year’s study.)

The increasingly difficult search for housing takes its toll on suburban working families and has “real consequences for their livelihoods,” Poethig says. Families are forced to move around a lot, which impacts childhood development. Rising rents affect decisions about what food to buy, resulting in consequences to personal health. The very basic human need — shelter — becomes a factor in all other aspects of a person’s life.

“Housing actually becomes a gateway or inhibitor to opportunity,” says Nathaniel Smith, founder and Chief Equity Officer at the Partnership for Southern Equity. “Where you live decides whether you have access to a good school, whether you have access to a good hospital, whether you have access to good fruits and vegetables.”

It also determines how easily one can find a job. A recent Brookings Institution study found only 21.7 percent of metro Atlanta jobs are accessible within a 90-minute transit ride, putting the region near the bottom among American cities.

Finding an apartment with transit access is crucial for people like Hunter who depend on it. And even if she finds another place near a bus stop, her work isn’t done. “Then you have to transfer schools,” she says.

“One of the local schools, Riverside Intermediate, said they have over 40 kids that live in Magnolia Crossing,” Albert McRae of the Austell Community Task Force says. “You’re talking about 40 kids who are getting ready to go through a transition.”

Beyond managing federal housing programs at the local level, Cobb County government does little to encourage the renovation or construction of affordable housing. Instead, it opts for the destruction of the few affordable complexes and calls it revitalization. Many of the demolitions have occurred in predominantly African-American and Hispanic communities.

“One thing the MHA has gotten good at in the last 10 years is tearing stuff down,” MHA head Pete Waldrep told the Marietta Daily Journal in January 2015. “We know how to move people. We know how to relocate people, and get it torn down efficiently.”

The MHA manages affordable housing in Cobb. Most of the non-senior public housing MHA used to operate in Cobb was demolished by 2013. As Waldrep told the MDJ last year, “We are out of the public housing business.” The MHA still manages a few affordable housing complexes, but all of them — save for the 50-unit Henry Hull Homes complex in Acworth — are reserved for seniors or the disabled.

The MHA does administer the distribution of about 3,400 Section 8 federal rental assistance vouchers being used in the county as well as various programs that encourage home ownership. The organization also works with private developers to help them apply for low-income housing state tax credits to subsidize construction of new senior housing developments.

As for the county working to encourage more low-income housing construction, Cobb Chairman Tim Lee doesn’t think government should play a role.

“We have the responsibility to provide a competitive environment for the development community to respond to the economic conditions, and that’s where it stops,” Lee said in an MDJ interview about SCRA’s plans for Magnolia Crossing last November. (Lee did not respond to multiple requests for comment for this story.)

Private developers have difficulty building and operating low-income housing at a profit without government help. The Harvard Joint Center for Housing Studies recently pointed out that the “private sector cannot profitably supply very low-cost units” and the “government must play a critical role in ensuring that the nation’s most disadvantaged families and individuals have good quality, affordable housing.”

Over the last five years, Smyrna has used public funds to raze a 10th of the city’s rental apartments. One of the city’s more high-profile projects was the $16 million purchase and destruction of the 728-unit Hickory Lakes complex in 2010.

Smyrna’s original plan for the cleared property listed a corporate campus, mixed-use development, hospital, or even a “sportsplex” as possible future uses. But city officials struggled for several years to find a buyer before finally selling it at a $2 million loss. The purchaser, Southeast Capital Companies, is building a single-family development on the site called Smyrna Grove, with plans for nearly 200 homes in the $350,000-$450,000 range.

Marietta’s vision for Franklin Road can be described as Hickory Lakes on steroids. In 2013, Mayor Steve “Thunder” Tumlin put forward a plan to spend $68 million purchasing and knocking down apartment complexe s along a mile-and-a-half stretch of the road between South Marietta Parkway and Delk Road.

The Marietta City Council put a redevelopment bond on the ballot and voters approved it by 433 votes, raising their own property taxes in the process to pay for the demolition project. Marietta purchased four properties totaling 92 acres — Flagstone Village, Woodlands Park, Preston Chase, and Marquis Place — that contained a total of 1,334 rental units.

As in Smyrna, Marietta officials had big plans. A 2009 redevelopment proposal called for the creation of a Global GreenTech Corridor, described as an “ecosystem where business, academia, and government collaborate in building the renewable energy technologies of the future.” Home Depot opened a new IT center near Franklin Road in October and will benefit from up to $200 million in separate county tax incentives over the next decade. Still, the result looks less like Silicon Valley and more like Summerhill in the ’60s.

After a brief dalliance with DeKalb County, Arthur Blank is near an agreement with Marietta to build the training facility and main office building for Atlanta United FC, his Major League Soccer franchise launching in 2017, along Franklin Road.

The deal is a good one for Blank. While the final terms are still being worked out, the team will lease the property where Flagstone Village and Woodlands Park once stood — property that Marietta taxpayers spent at least $50 million clearing — for $1 a year for 10 years. After that, the team will pay an inflation-adjusted rate starting at $320,000 per year for at least a decade, with the option to renew the lease for two additional five-year terms. The city also agreed to help the team apply for a 10-year tax abatement that will significantly reduce its tax bill.

At Cobb’s southern tip sits an attraction that, over its nearly 50 years in operation, has failed to bring sustained, long-term economic vitality to the surrounding area — Six Flags Over Georgia. A couple miles from the theme park sits Magnolia Crossing, which has been targeted for redevelopment for years.

“Because of the foreclosure of Magnolia Crossing in 2002, it’s come up on our radar because it had been on the rolls for quite some time,” Cupid says. “With the conditions on that site, and its location, it lent itself to consideration quite early on.”

Future plans for Magnolia Crossing are in flux, but a decade-old study of the Six Flags corridor envisioned a “destination/activity center, complete with parks and greenspace, new multi-family housing opportunities, and new mid-range retail outlets.” SCRA Chairman Ed Richardson has said the property could become a “launch pad for mixed-use development.”

Cupid would like to see development bring new amenities to the area, such as a grocery store, banks, a public library, and a police mini-precinct. She says they want places to convene, such as restaurants.

Cupid is also pushing for more robust workforce development programs, infrastructure improvements like new sidewalks, and better transit options, including a new bus route to link residents to jobs at the new Braves stadium.

McRae says that while he appreciates Cupid’s efforts to revitalize the area, he wonders what impact the initial bond money can have.

“I know there’s a movement to revitalize the area and continue to get developers in there. And I think the whole economic redevelopment of the area probably has some momentum for that,” he says. “You can’t do all that with $10 million, I don’t think.”

“I’m trying to stay in this area because of my job,” says Trent Walker, who’s lived at Magnolia Crossing for three years and works just a few blocks away. “It might be kind of tough.”

Hard data on where displaced residents like Walker wind up is hard to come by. In the case of Franklin Road, the MHA was only able to collect information from about half the residents, with a portion of them moving out of the city or even the state.

“Families moved to the Six Flags area because it was affordable,” says Monica Delancy, a member of the Austell Community Task Force who’s working with Magnolia Crossing residents during the transition. “Now that they’ve started tearing down apartments, apartments start raising their rates. Those families, they’re going to have nowhere to go to. Not in Cobb County.”

Sonia Fischer and her daughter Makiyyah are two of Magnolia Crossing’s residents at risk of becoming homeless. At a recent Cobb Commission meeting, they asked commissioners to push their move date back and provide additional moving assistance.

“I’m one of the children affected by what’s going on at Magnolia Crossing Apartments,” Makiyyah, age 8, said. “I am afraid of becoming homeless. I am in third grade and I am doing very well in school. I don’t want anything to mess that up. Please don’t do this to my family.”

Makiyyah’s not alone in facing a change in the middle of the school year. McRae, who’s been working closely with the residents, says there are around 150 children in the Cobb County School System currently living at Magnolia Crossing. “We want to answer the question whether these families are not good enough to stay in Cobb County,” McRae says. “We all want better development in South Cobb. We all want to bump up our quality of life. With that said, what’s the route that we take?”

If Cobb officials did decide to change course and increase the amount of affordable housing for families like those at Magnolia Crossing, they have several options available. They could use bond financing to subsidize the construction of low-income housing. San Francisco will do just that after voters overwhelmingly approved a $310 million affordable housing bond referendum in November.

Officials could also mandate that new apartments set aside a certain percentage of units for low-income renters through inclusionary zoning. Although Cupid expressed support for the idea, it’s unlikely Cobb County will implement it.

“Unfortunately, from what I’ve heard from some of the local commission leaders in Cobb and Gwinnett, people aren’t as open and amenable to doing that,” Executive Director of the Georgia Budget and Policy Institute Taifi Smith Butler says. “They want a strong property tax base, so they’re looking at those luxury units because it will drive property taxes.”

Other cities around the country provide examples of how Cobb could work with private and philanthropic partners to subsidize the development of more housing. In Chicago, the nonprofit Community Investment Corporation disperses funds pooled together from local banks and relends that capital at lower rates to owners to help them improve their rental properties and keep them affordable without subsidy.

Through the Housing Partnership Equity Trust (H-PET), philanthropic organizations such as the MacArthur and Ford foundations have teamed with Prudential, Citibank, and Morgan Stanley to work with nonprofit housing developers to purchase dilapidated apartment complexes, fix them up, and rent out units to low-income residents. So far, H-PET has funded four projects in Virginia, California, and Illinois.

According to Poethig, these innovative initiatives are “helping nonprofits preserve affordable rental housing. You can be a very proactive city leadership when you recognize that this is a problem you’re trying to solve for.”

City and county leaders in Cobb, however, remain focused on managing the destruction of their existing rental housing stock. They believe their efforts will benefit the affected communities within a few years.

“It’s going to take time, but I think you’re going to see some major changes over the next five to 10 years for Franklin Road,” Marietta’s Economic Development Manager Beth Sessoms says. “The goal is to bring businesses back that will create jobs and help bring the area back to what it used to be years ago.”

As for the residents who had to move out, Marietta Communications Manager Lindsey Wiles believes their situation will be improved. “These people deserve better. And some of these people don’t know they deserve better.”

Kate Little, relationship manager of the non-profit housing and community development group Georgia Advancing Communities Together, isn’t so sure demolishing apartment complexes and selling the land to developers will benefit the county’s displaced residents.

“If you’re just tearing down units and you’re not thinking about how those units are replaced or where those people go, you shouldn’t couch it as you’re doing them a favor by de-concentrating poverty,” Little says. “What you’re really doing is increasing homelessness or adding to overcrowding. I think people would rather be concentrated in poverty with a roof over their head as opposed to de-concentrated and on the street.”