Bill Knight | How to address homelessness

BILL KNIGHT

BILL KNIGHT

Neither the City of Peoria nor Peoria County has a lot of extra money sitting around, but do you know who has even less?

The homeless.

Helping the homeless, however, should be more than a passing winter impulse, and ensuring more decent, affordable housing should be more than a catchy campaign slogan for spring elections.

Fortunately, there’s a way to help, from building resources to provide more affordable housing in general to assisting emergency shelters in particular: increase an existing county fee on sales of high-priced properties.

Homelessness became a social problem in recent decades when most cities razed substandard “skid row” areas; federal and state governments “deinstitutionalized” mentally ill Americans (more than 20 percent of the homeless are mentally ill), and single-parent households increased substantially. All that contributed to people sleeping in cars, parks and in the open.

The most recent statistics from the U.S. Department of Housing and Urban Development shows Illinois has 10,798 homeless citizens, including 6,894 individuals, 3,904 people in families with kids, 864 veterans, 730 unaccompanied minors, and 1,355 chronically homeless individuals.

A few good, if modest, efforts to lend a hand exist, of course. Peoria’s new Madison Avenue Apartments will be a terrific positive, but it will serve just eight individuals and two families, and Peoria has hundreds of homeless people, according to the Heart of Illinois United Way, the local Homeless Continuum of Care provider.

An even more meaningful response would be if Peoria County hiked its transfer fee $2 to match the City’s existing tax and applied it exclusively to high-value properties (say, $250,000 and up). It would be a progressive fee, too, meaning that the same rate would apply to property selling for $250,000 or $2.5 million.

Sellers pay a transfer tax now: $1 per $1,000 of value from the state, 50 cents per $1,000 from Peoria County, and $2.50 per $1,000 from the City of Peoria.

Here’s the general concept: More than $1 million a year could be raised if Peoria County’s transfer fee would increase to match the City’s. That’s based on data from Recorder of Deeds transactions from Aug. 1 – Nov. 30. That four-month period saw 76 sales of more than $250,000 in August (totaling $39,625,985); 95 such sales in September ($46,069,772); 92 similar sales in October ($75,284,837); and 69 such sales in November ($51,244,341). The total from those four months is $212,224,935. Multiplying that by 3 to get a 12-month figure – assuming that period was somewhat typical – yields $636.674,805.

Divide that dollar amount by the factor of $1,000 gets 636,674.81; and multiplying that by the $2 increase results in annual revenue of $1,273,349.61 to devote to the homeless and affordable housing.

The new $2.50 transfer fee for homes of $250,000 and up still compares favorably to Chicago, for example, which charges sellers $10.50 per $1,000 of property value.

As shown by the City Council’s 6-5 vote last month creating a three-year pension fee to help close a budget gap, it’s politically possible to spread the burden of prior obligations throughout the area.

However, state law requires a referendum to enact such a change, and Peoria County voters in November rejected a measure to raise the County’s retailers’ occupation tax of half a percentage point to pay for road repairs.

Nevertheless, Peoria County voters in 2016 passed a ½-percent County School Facilities Sales Tax for public school facilities, so support is feasible. Also, this would affect those able to pay (the median, or mid-point, list price of properties selling in the Peoria area is $112,500, according to Realtor.com). Also, sellers can always determine their own price for properties they’re offering to sell.

Further, voters who feel a blanket distrust of government (like those who opposed the City buying back the water company) may realize that some government programs are popular, like Medicare. Lastly, to make this more inviting, an Intergovernmental Agreement could be drafted to create a collaboration to serve as the new housing program’s administrative agent, perhaps involving the City’s Fair Employment and Housing Commission or a non-governmental agency such as the United Way or the South Side Office of Concern (which last year received a $4.4 million grant from the Illinois Housing Development Authority to convert its office space to subsidized housing).

It’s past time to take action to address homelessness and, yes, we can.

Bill Knight



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