Public Housing Makeover

Rich Meagher: Welcome to RVAs. Got Issues, the show that brings you the people and ideas that are reshaping Greater Richmond. I’m your host, Rich Meagher. One of the biggest issues in RVA is housing I. How to provide enough homes for the people who want to live here. For almost a century, local government has been the landlord of last resort providing public housing for our most vulnerable residents.

But here in RVA, there’s a plan to replace our public housing communities with something completely different. Today we’re talking with Steven Nesmith. He’s the CEO of the Richmond Redevelopment and Housing Authority, or RRHA. He’s spearheading this bold new plan that he says may end public housing in Richmond.

Welcome, Steven. Thank you. So Steven, in the past you have said that you are looking for an end to public housing, and you don’t wanna put yourself out of a job necessarily. What do you mean by that?

Steven Nesmith: So, yes, and we’re going to, we’re going to end public housing as we know it now. Yeah. In the city of Richmond.

What does that mean? That means we’re going to empower people to move from a mentality of I should be living in public housing for the rest of my life, rather that I’m gonna move and graduate to a place of self-sufficiency and maybe to home ownership. And this can be subsidized in many ways from the government and from the private sector.

That’s how we’re gonna end public housing. And as we’re graduating folks to self-sufficiency, we open that safety net and bring people off the wait list and we give them a place to live. That’s how we’re changing public housing forever in the city of Richmond. And. We’ve never known it

Rich Meagher: before. So getting to specifics, let’s talk about the actual work that you’re doing, like this project in Creighton Court.

Mm-hmm. So Creighton Court is this decades old public housing facility. I think it had about 500 units of low income housing all subsidized by federal money. And now you’re redeveloping it into this mixed income, mixed use development. So what’s it gonna look like when it’s finished? What are we looking at when we look at the new Creighton Court?

Sure.

Steven Nesmith: So it’s a mixed income community. What that’s gonna mean is that we’re gonna have some market rate, we’re gonna have some, what I call middle income workforce housing, and we’re also gonna have some that will be set aside for our public housing residence who want to return. Currently, as you says, it’s about 500 public housing residents that were leaving there.

Those 500 or so residents, they’re given a voucher, right? We have something embedded in all our redevelopment plans, which is called the Residents Bill of Rights, and what that basically says is that resident, when they get that voucher, they have the right to say, I want to stay in return, or I wanna take that voucher and go to another part of the city or county.

Rich Meagher: So basically for the folks who are in public housing now who are in Creighton Court, RRHA has committed that they get to stay in public housing if they need to. If they want to come back to Creighton Court, they can. If they wanna go somewhere else, they can, but they’re not gonna lose their housing subsidy because of this redevelopment.

Steven Nesmith: That is correct. What we have seen around the country, and I’ve represented housing authorities around the country, and it’s no different here in Richmond, is that when a public housing resident is given that voucher, they’re empowered. They then choose where they wanna live. The majority, and I’m would tell you, 75% of public housing residents around the country, Richmond’s no different.

They choose not to come back, but to go live in a different area. And so why is that? Why don’t they want to come back? Many of them say to themselves, I want to live in a mixed income now to go immediately find a new environment where I’m around folks that are not just public housing. There’s a term called one for one, and people get that very confused, right?

Because. One for one, it does not mean when you demolish one public housing unit, you replace that same public housing unit right in the same place that’s called Reconcentrated Poverty.

Rich Meagher: Let’s talk about this a little bit. This new Creighton court, you’re saying it’s roughly a. Third market rate, meaning you charge the standard price for an apartment of that size in Richmond. Then you said workforce housing, is that rent controlled, or at least it’s subsidized. You try to keep the rents low.

Is that the idea of those,

Steven Nesmith: those are subsidized as well? That’s right. Okay. So we look at what’s called the area medium income. Okay. And. For those that are in that bottom third, that is subsidized wholly residents should not pay more than 30% of their income towards housing, whatever the balance is, that’s that subsidy for that workforce housing that is subsidized, but it’s not deeply subsidized.

Rich Meagher: So I’m guessing that the market rate apartments help pay for the cost of the subsidized apartments.

Steven Nesmith: Right. You’ve got it right. It’s called the financial capital stack. The market rate, they help subsidize downstream, the deeply subsidized ones as well.

Rich Meagher: But you’re also trying to say here that there’s a benefit for the residents too, that the changes from what you’re calling concentrated poverty, what?

Currently exists in Creighton Court, right? Everybody there is subsidized housing, everyone’s public housing, everyone’s very low income to mixed use, what are the benefits of de concentrating poverty, of having this mixed income community?

Steven Nesmith: I grew up in public housing. This is very personal to me. And you know what?

People see drug dealers. Mm. And I can tell you right now, today, if I go into those big six public housing communities, those young people, they’ll say, I can make more money selling drugs. We look up to what we see. I have a white adoptive family. They’re lawyers when I grew up. I aspire to be a lawyer.

Mm-hmm. And, and I grew up, and that’s what I aspire again, we aspire to what we see around us.

Rich Meagher: I get this point, but there has been some pushback to this idea, as you suggested from folks even like me. I have been skeptical in the past and things that I’ve written, uh, one of the, the concerns is about repeating the mistakes of the past, right?

Mm-hmm. So in the past there was this idea of urban renewal, and that’s what got us these public housing communities in the first place, right? The idea that, oh, here’s a community, it’s blighted, it’s poor, people are having a tough time there. Let’s just demolish it and replace it with something else. But that was done without resident input.

It demolished and destroyed communities. So are you worried about. Creighton Court, are we destroying a community there and dispersing the people that lived there in a way that is disruptive to their lives?

Steven Nesmith: Resident input. Is at the center of what we do. So before we decide what Creighton Court was gonna look like, before we decide, because we now have a developer for Gilpin, before we decide what Mosby’s gonna look like, the first step is resident engagement.

We have a minimum of about 15 community led events where we sit down in the community center and we ask. Where do you wanna see a green space? Where do you want see maybe a small commercial card. Where do you want to see a Boys and girls club? Where do you wanna see a healthcare facility? So you don’t have to travel to Bon Seur.

You can get your healthcare right there in your community. So that’s how it’s different here. Residents, not the folks at RHA who think they’re really smart or not. The developers, they say, this is what we want our community to look like. Then. The developers in there, and then they come up with schematics and designs.

Then after those multiple conversations, we bring those drawings to them in subsequent meetings and we say, did we capture what you said you wanted?

Rich Meagher: So the folks who are coming back are able to experience that, but there’s still is, there’s something lost by this kind of dispersal, right? I understand your argument.

We want to deconcentrate poverty, but it still was a community there. And it’s not all just drug dealers and crime, right? There are people who are neighbors and connected. So are, are we losing something by. Breaking those folks up and dispersing them through the voucher program, even if they decide they want to do that.

Steven Nesmith: Right. So there’s a sweet positive story about that. I used to live in public housing and yeah, I was poor. And guess what? People live in public housing that’s working poor. Right. I grew up on welfare also. I had lots of good memories there, but I aspire to do all the things and guess what? There’s, everything’s right about saying, I used to live here.

Look at where I, I used to do this and that, but I’ve, I’ve aspired to other things, so we can’t get lost into this romanticized notion that you gotta stay. Where you are. It’s about building new memories and building a new community. That’s what’s exciting. Aspire for new dreams. That’s what I tell my kids every day.

Rich Meagher: So there is some data that suggests that while you’re building these new communities and you are moving people into places where they are in these aspirational, more mixed communities, that the overall effect is that you get a reduction in the number of public housing units. Mm-hmm. And that. Doesn’t address the underlying need in the community.

So the concern here would be ending public housing isn’t really addressing the need that people have for affordable housing, but instead it’s just sort of getting government out of the business of providing it.

Steven Nesmith: Yeah.

Rich Meagher: So is that a concern? Is that a danger? What are these folks supposed to do? Is there a numbers game that you’re keeping an eye on to make sure like.

Alright, well we have a, you know, 50,000 people in housing now. We’ve gotta make sure we’ve got 50,000 spots from them somewhere down the line.

Steven Nesmith: Yes, you’re right. We have to make sure as we’re redeveloping that there is still a safety net. And that’s what people have gotta understand. Yes, we’re paying attention to those numbers, but this is the problem.

We’ve gotten into a mindset that people ought to be in public housing. For the rest of their lives. We have people living in Richmond Public Housing. I was reading on the news. They’re not paying rent. We now have people who’ve been living in public housing that owe between 10,000 and over $30,000.

People just said. I’m not gonna pay. Mm. You’re not gonna do lease enforcement and IE evict me.

Rich Meagher: I understand the idea that you just can’t have people not paying rent. Right. But the Legal Aid Justice Center was part of a group that just recently filed a lawsuit against rha. Mm-hmm. About this idea of hardship exemptions.

Mm-hmm. Right? Mm-hmm. That’s a legal requirement that if someone experiences. Financial problem a sudden one, not that they just decided not to pay, but you know, an example of someone from the lawsuit was that their SSI benefits just got cut off and that they’re supposed to be granted a hardship exemption.

And so the concern here is that it appears RHA has only granted one of these in the last six years. So, so what about that you can understand some people concerned about mm-hmm. Like sort of trust issues with RHA because of that, right?

Steven Nesmith: Sure, sure. So first of all, it’s a legal matter. It’s not into litigation yet.

We’ve decided we’re gonna have a conversation. What I can tell you is this, first of all, we do have a burden to inform, and I believe at the end of the day, it show that we have informed, but if you have a hardship, the burden knows on you to come to the housing. I say, Hey, I have a hardship. I just lost money.

We do the reduction, but if you don’t tell us, we don’t know.

Rich Meagher: I’m getting a, a kind of tough love vibe from you. Is this like kind of the approach that you’re bringing to some of this policy, to some of this like approach to residents that, yes, you’re sympathetic and clearly passionate about this, but you’re asking residents to take on some more responsibility here?

Steven Nesmith: The more we try to empower residents, we must ask for responsibility at the same time. Right? What we have to be careful. It’s not to, um, foster, I would say this what’s called moral hazard. We can’t say if you just wanna live for free, go ahead and do it. We want to instill the notion that there is some responsibility in you.

So, so guess what happened to me? I got kicked outta the house. I left when I came back from university and I said, okay, you know, I’m gonna do this mom, whatever. And she said, well, you gotta go get a job. Yeah. And at some point. I didn’t get a job because, you know, I thought I could hang around because this mom, mom’s let me hang around, you know?

But she said, no, you gotta go. I went to my cousin, I said, can you mean your mom did that to me? You can stay for a while. But it was tough love. Yeah. Because then I said, okay, I went out and getting a job because mommy. And so, yeah, I think that in life sometimes, um, we had be compassionate. But with that comes some responsibility.

Yes, you’re absolutely right.

Rich Meagher: We’ll hear more about RRHA’s deal making and how they’re dealing with the chaos in the federal government when we come back on RVA’s Got issues.

This is RVAs got issues. We’re talking with Steven Nesmith, CEO of the Richmond Redevelopment and Housing Authority. So one other concern is just. About the idea of a public private partnership, right? You’re working with private developers who are doing a lot of the development in places like Creighton.

Do you lose some accountability when you’re working with private developers? Are you handing over too much control? Is it still public housing? If it’s privately developed?

Steven Nesmith: I’m a former, not just public housing resident. I have worked for Fortune 500 Companies as a business person, and I’m bringing some business principles to our development deals with these private sector developers.

Namely, we not only want to have skin in the game on these developments, that means you still have some responsibilities to us. You know what some of those responsibilities are to ensure this is a big one, to ensure that. A portion of the units, call it 50% of them must remain in perpetuity, affordable.

That is legal language that we put into those to ensure, because we can’t just trust the private sector. I. So we put legal language in there so that affordability will be there for the future. In that public private partnership, we have specific oversight responsibilities. We ensure that on a monthly or at least quarterly basis, these private sector developers have to report back to our RHA, whether or not they’re meeting their regulatory requirements.

So we have a, not a 50 50. Co-management responsibility, but we do have continuing oversight and they have reporting responsibilities to us.

Rich Meagher: And so you’re able to work with these private developers. You’re comfortable with the accountability. You are working with residents to try to instill more responsibility in them.

You’re hearing from them, you’re building all this stuff. And so that’s driving this redevelopment plan, hanging over. All of it is the big picture in Washington. Lots of changing direction, new executive orders, cuts and jobs and funding, right? So you depend. Pretty heavily on federal funds. Where are you right now with the, we keep calling the fire hose of news outta Washington.

Are you still getting federal funding? How much of the budget for RHA is federal funding and what are you gonna do about it, Stephen, if that funding goes away?

Steven Nesmith: Yeah, you raise an important point because 78%, which is a large number of our funding, comes from the federal government. So a couple things.

Number one, in our real estate development deals, we try not to rely a hundred percent or majority on federal funds. For instance, let’s look at Creighton Court. Yeah. We have $21 million that’s come from the city, of which we’ve probably got 12 million of that, and that’s for infrastructure. We also have on the state level, uh, 7 million coming from Virginia Housing, and then some additional funding coming from Virginia Housing in the form of the tax credits, incentivized investors.

Then from the federal level, we have what’s called home funds and what was called. ARPA funds out of the Biden administration that comes through the city of our project, and we have the developer themselves, right? They’re putting up their own money, they’re, they’re putting up their own money, so we try to diversify our development deal so we’re not so reliant on the federal government.

That’s why I believe. So strongly in public private partnerships, but there’s something much more urgent on the table that is 75% of our overall operations comes from hud. So I’m looking at the craziness that’s gone on in Washington, DC. And we’ve been having some conversations with my chief financial officer about if this funding in this area is cut off, where do we go?

Right? What do our reserves look like? What’s our cash flow position? So we’ve been looking at some of that. When this first Doge stuff happened, it was lucky ’cause I got a tip that it was coming. I told my chief finance officer, I said, you know what? Draw down some money and we’re ask for forgiveness later on.

Right, because we’re gonna service our people, right? So we’re gonna be looking at some scenarios and game planning out what we would have to do to survive.

Rich Meagher: Okay? You also need to work with local government, particularly the city of Richmond. Where are you with the new mayor now? Danny Aula.

Steven Nesmith: I’m very excited about Mayor Villa’s housing economic Development plan.

I believe housing is economic development in and of itself. He and I had a great one-on-one meeting. We talked about his housing plan. We talked about the goals of our RHA and what he believes, and I told him this. I said, mayor Avula, your success is RHA success. I’m here and we are here, my team to help this so that we’re mutually successful.

He has invited me part of his cabinet as well.

Rich Meagher: Housing was a big part of his campaign. You know, you, you’ve been a little skeptical of this idea of, of one-to-one that people might misunderstand it. Do you feel like you might have some different ideas than Mayor Avula or the Avula administration on. That kind of idea.

Steven Nesmith: I would say for the most part, he and I understand the whole idea about one for one should not represent Reconcentrating poverty. He and I and his people are on the same page with that. One of the things that he and I talked about, he being a doctor, that you have six healthcare resource centers in the big six.

He used to run those. Yeah, and one of the things I’m hoping that. Reflects in his priorities and maybe when he submits his budget to council, is that we’re trying to build up more capacity. I had some public housing residents come me and say, Mr. Nesmith, I see you’ve got a free job training program that might lead to livable wages, but you know what, I have problems

sometimes just getting outta the bed. And so what we want to do is focus on overall wellness, healthcare disparities and trying to, you know, deal with the capacity issues that individuals may have to be able to. Take advantage of opportunities. I’m even thinking about entrepreneurship for youth. Well, young men and women be thinking in that regard.

You can’t talk about home home ownership unless you got a job. Yeah. I’m aspiring to take that other choice and to go to self-sufficiency and maybe a little bit of wealth building and by the turn, you know what we’re doing. I’m gonna open up the safety net for someone else to come in.

Rich Meagher: Hmm. So what can our listeners do to help?

Steven Nesmith: Be more engaged with RRHA and our public affairs group, our communications group. Mm-hmm. If you think you’ve heard something, come to us, dial in, submit an email, go to our website. We’ve got a place where you can ask questions. Let’s start communicating more. As the weather gets better, we’re gonna be out doing more community engagements.

We’re gonna be holding these town halls and letting folks know what’s going on. And I wanna say this. We’re not the RHA of Old. I’m so thankful that they’ve given the the trust in me to have me continue to do this job. I’m here for the long run. But here’s the deal. We’re bringing stability and we’re bringing change, and what I want the residents to do and everyone to do is to join us in believing.

That there’s change. We’ve already brought change. This redevelopment of Creighton Court is the first major redevelopment of public housing in just over a decade in the city of Richmond. So I want the listeners and everyone to keep an open mind because we are doing things differently. We’re showing compassion, right?

And we’re giving people a second chance. We’re bringing these public private partnerships, and what we also do is asking for resident accountability. And so I would just say stay tuned, stay positive, ask questions, and push us to make sure we’re held accountable to do what we say we’re gonna do.

Rich Meagher: Steven Nesmith is CEO of the Richmond Redevelopment and Housing Authority. I. Thank you, Steven. Thank you.

That’s our show. Thanks to our guest, Steven Nesmith. Later this season, we’ll have a conversation with Superintendent of Richmond Public Schools. Jason Kamras, do you have a question for him about city schools? Leave us a voicemail at 8 0 4 5 6 oh. 8 1 0 8. That’s 8 0 4 5 6 0 8 1 0 8. Stay tuned for future conversations with other city leaders too.

You can also visit our website, RVAs Got issues.vpm.org. RVAs Got Issues is produced by Max Wasserman and Rachel Dwyer and edited by Steve Lack. Our intern is Cate McKenzie. Our theme music was composed by Alexander Hitchens. Meg Lindholm is our executive producer. Steve Humble is VP’s Chief Content Officer.

I’m your host, Rich Meagher. Thanks for listening.