Drop in poverty rate likely due to displacement

When the poverty rate in a city drops, many would consider it a cause for celebration. In Austin, however, where property value increases have outpaced family income growth for decades, that is not the case.

City Demographer Ryan Robinson told members of the Regional Affordability Committee at their first meeting Monday that recently released poverty-rate data likely indicate that low-income residents are moving out of the city at a rapid pace and into nearby areas such as Bastrop and Caldwell counties. He called the revelation “an omen, in the bad sense.”

The data, which came from the U.S. Census Bureau’s American Community Survey, show the overall poverty rate for the city dropping from 20.3 percent in 2012 to 17.8 percent in 2013.

Robinson said he was surprised when he first saw the numbers. “We got in a new poverty rate that came in about eight weeks ago,” Robinson said. “I really got excited. I almost picked the phone up, was going to call the mayor and say, ‘Man, I’ve got good news.’ And I thought, ‘Wait a minute.'”

That is when Robinson looked at poverty rates for nearby jurisdictions and saw that the rate in Bastrop County spiked from 10 to 22 percent during the same period.

“The lesson, for me, is that we’re not just displacing our poorest, but we’ve been having people pushing way out,” Robinson said. “So they’re now outside the service area of Capital Metro, they’re in a harsher food desert than they were before.

“This time next year, we’re going to get another poverty rate,” he continued. “More than likely, we’ll see a continuation, not because we’re making our citizens more prosperous, but because it’s becoming harder.”

In the Austin area, the median home price has risen from $73,000 in 1990 to $239,900 in 2014, while the median family income has increased only from $39,400 to $75,400 in the same period.

Travis County Commissioner Margaret Gómez, one of the county’s representatives on the committee, said bluntly, “That is not a good way to reduce our poverty rate.”

Capital Metro Board Member Terry Mitchell, who represents the transit agency on the committee and is president of real estate company Momark Development, noted that such housing trends have major implications for transportation and mobility in the region.

“Every time we disperse our folks further and further out, we’re adding to our transportation issues. So it’s not just a housing issue, it’s a transportation issue as well,” said Mitchell. “It makes it very hard for Capital Metro, because the last thing you want is for people to be dispersed out into the hinterland. That makes the job much worse.”

Robinson agreed. “One of the big, long-term solutions to a spike in the affordability landscape is high-capacity transit,” he said. “How in the world does New York work? The only way it works is because they have high-capacity transit.”

Noting that there are seven school districts that “touch” Austin, Robinson added that education is another issue related to poverty and migration trends.

“If our cities become a centrifuge, if we are displacing our poor and we’re pushing our middle-income families,” Robinson said, “then we’re pushing them out into a regional school landscape that’s already very differentiated by quality, real and perceived. And we’re simply reaching out and we’re amplifying that difference.”

The conversation took place before representatives of the Austin Independent School District had noted that decreasing enrollment rates are having a major impact on the district’s budget.

In order to paint a clearer picture of the overall issue, Robinson broke up the 2013 poverty rate by age group and race. He noted that the poverty rates for African-American and Hispanic children under age 5 is 51.8 percent and 33 percent, respectively, which he said demonstrates major family affordability issues.

The 2013 poverty threshold was $23,835 for a family of four.

Robinson also noted that, while property values in many areas of the city have increased in the past seven years, the median value of single-family homes in the 78702 ZIP code, which encompasses many traditionally low-income East Austin neighborhoods, has outpaced every other and increased by more than 200 percent.

“I don’t want to diminish that affordability is, in fact, pressuring all of our families,” Robinson said. “But I do think we have to be pretty direct and deliberate when we map it and measure it that it’s affecting our communities of color and our low-income households in a far greater way.”

The newly formed Regional Affordability Committee consists of representatives of taxing entities throughout the region and will continue to discuss affordability issues on a monthly basis.

Photo by Ed Schipul (Flickr: Austin Texas) [CC BY-SA 2.0], via Wikimedia Commons