Researching Public Law and Public Policy in the Public Interest

Canary on the Riverbank: Terrell Homes and Newark’s Problem with Gentrification, Part I

Terrell Homes tenants at an October organizing meeting / CLiME

This past September, CLiME began this series on housing issues in Newark by reporting on a demonstration at City Hall, part of the National Tenants Day of Action.  I met many organizers and tenants from the Terrell Homes, who have been fighting to preserve the residences of over 200 families in this public housing development located in Newark’s Ironbound neighborhood.  Terrell first made headlines in 2014 as the tenants fought against talks of demolition. Now the Newark Housing Authority has reinvigorated these talks—and fights—with their 2017 Agency Plan which includes a simple one-line proposal: "The NHA intends to apply for Demolition of Terrell Homes in conjunction with a potential riverside development by the City of Newark.”

Tenants from the Terrell Homes, led by organizers from the Ironbound Community Corporation and the Greater Newark HUD Tenants Coalition, said that the Housing Authority informed tenants at a meeting earlier that month that all residents would have to move out by June 2017.  Tenants were told they could voluntarily enroll in the Section 8 Housing Voucher program immediately. 

Organizers complained that tenants were deceived – that since the Housing Authority has not yet applied for Demolition, that requests to transfer out of housing will not be honored by property owners; that Section 8 Housing Vouchers have many more restrictions than public housing, including rental history and criminal background checks; that utility costs are not included; and that Housing Vouchers are too low for relocation to a ‘better’ neighborhood.

In a statement to CLiME, a representative from the Newark Housing Authority denied that any move-out date was ever given to tenants, since the Housing Authority had not even applied for the Demolition.  The same representative did stated that Terrell Homes residents are eligible for Section 8 Housing Vouchers, and are eligible to be transferred to the Pennington Court or Hyatt Court housing developments in the Ironbound neighborhood, due purely to the very poor living conditions in the Terrell Homes buildings.

The Newark Housing Authority estimates that it will cost over $60 million to repair the Terrell Homes up to code, citing “a 70-year-old electrical system that does not support modern appliances, crumbling pipes and infrastructure, inadequate HVAC system [and] storm water drains” as the housing development’s cost-prohibitive repairs. 

Connie Pascale, a retired lawyer for Legal Services of New Jersey, noted that the development plan referenced in the NHA Agency Plan proposes the use of Rental Assistance Demonstration (RAD) funding to create new mixed-income housing.

According to the U.S. Department of Housing and Urban Development, RAD funding “allows public housing agencies (PHAs) and owners of HUD-assisted properties to convert units to project-based Section 8 programs, providing an opportunity to invest billions into properties at risk of being lost from the nation’s affordable housing inventory.”  

While Mr. Pascale contends that the RAD funding could be used to rebuild the development’s infrastructure, the Housing Authority reports that additional funding would be required to complete any RAD repairs, and that NHA’s RAD re-capitalization analysis recommended that Terrell Homes not be subject to the RAD process because the project would not generate sufficient cash flow to repay conventional loans. 

On October 13, 2016, almost fifty tenants sat in the recreation room at the Millard E. Terrell Homes listening to Joel Ortiz of Legal Services advise them about the possibility of their housing development’s demolition.  The purpose of the meeting, organized by the Ironbound Community Corporation, Legal Services of New Jersey, the Greater Newark HUD Tenants Council, and the NAACP was a ‘Know Your Rights’ training for residents—more specifically, to educate residents of the their right to stay in Terrell Housing.

Mr. Ortiz reported a rumor that the Newark Police Department has been told not to respond to calls from Terrell Housing. “They’re trying to make the conditions so bad that the people will voluntarily leave!” he said. While the buildings literally crumble, violence is perceived to be on the rise, and amenities as basic as showers are missing from many of the apartments, the Terrell residents are urged to stand strong against the Newark Housing Authority.

Bill Good, head organizer of the Greater Newark HUD Tenants Coalition, announced that representatives from the Housing Authority were in the audience, and informed the housing representatives that some tenants had privately expressed to Mr. Good that they did not feel safe being open and honest about housing while in the presence of Housing Authority representatives.

Representatives of the Newark Housing Authority have stated that they will comply with all requirements for creating a collaborative relocation plan with tenants.  But for many tenants in the room, the assurance rang hollow—the NHA had only two years ago tabled a plan to demolish Terrell Homes only to revive it now. 

The Terrell Homes struggle resumes at a rare moment in Newark’s modern history: the growing risks of displacement by gentrification faced by the city’s large number of poor and working-class households.  City redevelopment in Newark has made national headlines. A recent New York Times article reports that there is currently $2 billion in development underway in Newark, including 1,500 housing units under construction and another 4,000 housing units planned for construction.

CLiME will continue to chronicle the relationship between the residents of Terrell Homes and their city agencies, as well as other developments that touch upon structures of inequality in a city rapidly undergoing change.