Business

For Black Homeowners, Great Recession Has Not Receded

Published

9 years ago

June 30, 2015

By Freddie Allen
Senior Washington Correspondent

WASHINGTON (NNPA) – Most economists agree that the Great Recession, sparked by the housing market crash, officially ended in 2009, but the fallout from the crisis will continue to hurt Black families, especially Black homeowners, for decades to come, according to a new report commissioned by the American Civil Liberties Union (ACLU).

“In 2007, median wealth excluding home equity was $14,200 for blacks as compared with over six times that amount, $92,950, for whites. Home equity, therefore, made up 51 percent of total wealth for the typical white homeowner in 2007. For the typical black homeowner this same year, on the other hand, home equity constituted a far larger 71 percent of total wealth.”

The report continued: “The fact that blacks hold the bulk of their wealth in home equity likely explains, at least in part, why black wealth, on a percentage basis, declined more than white wealth during the housing bust and subsequent Great Recession.

The report conducted by the Social Science Research Council found that even though Black families and White families lost wealth during the Great Recession, White families lost less and recovered faster than Black families.

White wealth levels, excluding home equity, showed signs of recovery between 2009 and 2011, measuring zero losses, while 40 percent of non-home-equity wealth held by the average Black family evaporated during the same period.

And while the typical Black family shed another 13 percent of their non-home-equity wealth, from 2009-2011, White families, on average, saw their home-equity wealth losses “slow to zero.”

“Not only were Black homeowners devastated by the housing market collapse, they are now being left behind,” said Rachel Goodman, a staff attorney with the ACLU’s Racial Justice Program. “It is very much a tale of two recoveries.”

The report said that between 2007 and 2009, the average White family lost 9 percent of the equity in their homes, compared to average Black homeowner who experienced a 12 percent fall in home equity.

“This disparity may stem from the fact that blacks were more exposed to predatory loans and other types of toxic mortgages and ballooning interest rates as compared to whites, leading to disparate rates of delinquency and foreclosure,” the report said.

Over the next two years, that slide in home equity would shrink to 2 percent for White families and 6 percent for Black homeowners. Further, these losses slowed to only 2 percent between 2009 and 2011 for White households, but for Blacks, home equity values continued to decline by 6 percent.

“While White home equity began to recover quickly after the housing crisis stabilized, this was not the case for Blacks,” the report said. “This difference likely emerges as a result of Blacks’ disproportionate exposure to predatory loans and other deceptive mortgage schemes.”

The Great Recession had a profound impact on the course of Black wealth and the racial wealth gap in the United States. Researchers predicted that, without the Great Recession, the ratio of White to Black median wealth would have decreased “from 4.4 times greater in 1999 to four times greater by 2031.” Instead the gap will widen and the average White family’s wealth is predicted to be 4.5 times greater than the average Black families wealth.

“By 2031, White wealth is forecast to be 31 percent below what it would have been without the Great Recession, while Black wealth is down almost 40 percent,” stated the report. “For a typical Black family, median wealth in 2031 will be almost $98,000 lower than it would have been without the Great Recession.”

Researchers also indicated that the home equity values the adult children of Black families that took losses during the recession will also suffer.

“Without the Great Recession, by 2050, home equity values for Blacks and Whites whose parents or grandparents owned a home at some point between 1999 and 2011 may have approached parity,” the report said. “As a result of discriminatory lending practices and the Great Recession, our analysis suggests that the next generations of Black families will still have home equity values only 70 percent of their white counterparts.”

Citing a joint study by the Department of Housing and Urban Development and the Treasury Department, the ACLU study noted that, “as of 2000, ‘borrowers in Black neighborhoods [were] five times as likely to refinance in the subprime market than borrowers in White neighborhoods,’ even when controlling for income.”

When Bank of America bought Countrywide Financial in 2008, the bank’s track record of troubling mortgage-lending practices and a discrimination case came with the deal. In 2011, Bank of America settled the case with the Justice Department for $355 million. The Department alleged that Countrywide had engaged in “discriminatory mortgage lending practices against more than 200,000 qualified African-American and Hispanic borrowers from 2004 through 2008.”

In 2012, the Justice Department settled a fair lending case with Wells Fargo Bank, over allegations that the financial institution, “engaged in a pattern or practice of discrimination against qualified African-American and Hispanic borrowers in its mortgage lending from 2004 through 2009,” a statement for the Justice Department said.

Investigators also found that minorities were steered into subprime mortgage loans at higher rates than similarly qualified White borrowers.

The settlement included $184.3 million for minority borrowers and another $50 million in resources for direct down payments to help residents living in communities hit the hardest during the housing crash.

But it’s going to take more than settlement money to help Black homeowners guided into subprime mortgages, who were crushed during the housing market crisis as they continue you struggle almost six years after the end of the recession.

In the press release about the report, Sarah Burd-Sharps, the co-director of the Social Science Research Council’s Measure of America project, said that, “Steps can be taken right now to help close the growing racial wealth divide, and to ensure that the next generation has the benefits of assets and savings that bring a more secure future.”

The report recommended that policymakers closely monitor current lending practices at banks to protect low-income and minority borrowers from discrimination. The report also suggested that lawmakers clarify legislation governing access to credit and that they give regulators more power to guard consumers against racially disparate practices in servicing mortgage loans.

Goodman concluded: “This study makes clear that the devastating impact of the financial crisis on Black families’ wealth will continue until policymakers address this pressing issue.”

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Activism

‘Jim Crow Was and Remains Real in Alameda County (and) It Is What We Are Challenging and Trying to Fix Every Day,’ Says D.A. Pamela Price

“The legacy of Jim Crow is not just a legacy in Alameda County. It’s real. It is what is happening and how (the system is) operating, and that is what we are challenging and trying to fix every day,” said D.A. Price, speaking to the Oakland Post by telephone for over an hour last Saturday. “Racial disparities in this county have never been effectively eliminated, and we are applying and training our lawyers on the (state’s) Racial Justice Act, and we’re implementing it in Alameda County every day,” she said.

Published

28 mins ago

November 2, 2024

Oakland Post

Exclusive interview with County D.A. Price days before recall election. Photo by Ken Epstein.

By Ken Epstein

Part One

Alameda County District Attorney Pamela Price gave an exclusive in-depth interview, speaking with the Oakland Post about the continuing legacy of Jim Crow injustice that she is working to overturn and her major achievements, including:

restoring and expanding services for victims of crime,
finding funding for an alternative to incarceration and/or prosecution for substance use and mental health-related misdemeanors and
aggressively prosecuting corporations for toxic pollution and consumer violations.

“Racial disparities in this county have never been effectively eliminated, and we are applying and training our lawyers on the (state’s) Racial Justice Act, and we’re implementing it in Alameda County every day,” she said.

Passed by the State Legislature, this law “is an extremely helpful tool for us to address the racial disparities that continue to exist in our system,” she said.

(The law addresses) “the racial disparities that we find in our juvenile justice system, where 86% of all felony juvenile arrests in the county are Black or Brown children.

“We trained the entire workforce on the Racial Justice Act. We are creating a data system that will allow us to look at the trends and to clearly identify where racism has infected the process. We know that where law enforcement is still engaging in racial profiling and unfair targeting and arresting, we’re trying to make sure we’re catching that.”

Many people do not know much about the magnitude of Alameda County District Attorney’s job. Her office is a sprawling organization with 10 offices serving 1.6 million people living in 14 cities and six unincorporated areas, with a budget this year of about $104 million.

Asked about her major achievements since she took office last year, she is especially proud of the expanded and renewed victims’ services division in the DA’s Office, she said.

“We have expanded and reorganized the entire claims division so that we are now expediting as much as possible the benefits that victims are entitled to. Under my predecessor, they were having to wait anywhere, sometimes as long as a year, to 400 days to get benefits.

“Claims had been denied that should not have been denied. So, we’re helping people file appeals on claims that were denied under her tenure,” D.A. Price said.

“Under my predecessor, (the victims’ service office) was staffed by people who were not trained to provide trauma-informed services to victims, and yet they were the only people that the victims were in contact with. We immediately stopped that practice,” she continued.

“We had to expand the advocate workforce to include people who speak Hmong, the indigenous language of so many people in this county who are victims of crime.”

More African Americans advocates were hired because they represent the largest percentage of crime victims and we hired a transgender advocate and advocates who speak Cantonese and Mandarin. “The predominantly Chinese American community in Oakland was not being served by advocates who speak the language,” said D Price

“We reduced the lag time from the delivery of benefits to victims from 300 to 400 days down to less than 60 days.”

She increased victim advocacy by 38%, providing critical support to over 22,500 victims, a key component of community safety.

Other major achievements:

She recently filed 12 felony charges against a man accused of multiple armed robberies, demonstrating her seriousness about prosecuting violent crimes
In October, a jury delivered a guilty verdict in the double murder trial of former Alameda County Sheriff’s Deputy Devin Williams, showing DA Price’s commitment to holding law enforcement accountable.
She recently charged a man and woman in unincorporated San Leandro with murder, felony unlawful firearm activity, and felony carrying a loaded firearm in public.
A. Price’s office was awarded a $6 million grant by the state for its CARES Navigation Center diversion program. In partnership with the UnCuffed Project at a Seventh Day Adventist Church in Oakland, the program provides resources and referrals for services to residents as an alternative to incarceration and/or prosecution for substance use and mental health-related misdemeanors.

“This is the largest grant investment in the history of the Alameda County District Attorney’s Office,” said D.A. Price.

She explained that the program now has a mobile unit. “We have washers and dryers. We have a living room. We have a television. It’s a place where people can decompress, get themselves stabilized,” she said.

The project has “the ability to refer people to housing, to more long-term mental health services, to social services, and to assist them in other ways.”

Her office joined in a $49 million statewide settlement with Kaiser Health Plan and Hospitals, resolving allegations that the healthcare provider unlawfully disposed of hazardous waste, medical waste, and protected health information. The settlement, which involved the state and a half dozen counties, resulted in Alameda County receiving $7 million for its residents.
DA Price charged a former trucking company employee for embezzling over $4.3 million, showing her commitment to tackling white-collar crime.
For the first time, Alameda County won a criminal grand jury indictment of a major corporation with two corporate officers that have been sources of pollution. “They had a record of settlements and pollution in this community, and they had a fire that constituted a grave danger,” she said.

Attorney Walter Riley contributed to this article.

See Part Two

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Oakland Post: Week of October 30 – November 5, 2024

The printed Weekly Edition of the Oakland Post: Week of October 30 – November 5, 2024

Published

23 hours ago

November 1, 2024

Oakland Post

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Business

Chevron Reports Progress in Flaring, Emissions at Community Town Hall

At the first in a series of community town halls on Oct. 16, Chevron Richmond reported a reduction in year-over-year flaring incidents, both in number and duration, and detailed new technologies and processes that will further drive down emissions and heighten community awareness about operations. Chevron employees also answered questions from the community and listened to concerns at the town hall, which was hosted by Ceres Policy Research and held at CoBiz in downtown Richmond.

Published

5 days ago

October 28, 2024

Oakland Post

Community member Kathleen Sullivan speaks at the Chevron town hall. Photo courtesy Richmond Standard.

By Mike Aldax

The Richmond Standard

Chevron employees also answered questions from the community and listened to concerns at the town hall, which was hosted by Ceres Policy Research and held at CoBiz in downtown Richmond.

Similar town halls will be held twice per year over the next five years as part of a settlement agreement with the Bay Area Air Quality Management District (BAAQMD).

The goal is to increase transparency about flaring and increase opportunities for the community to get answers to their questions about potential impacts to the community.

A key output is the creation of a Community Action Plan, or CAP. The CAP aims to create a two-way dialogue between Chevron and neighbors around flaring and environmental compliance.

“Chevron’s focus in this process is one of learning and engagement,” said Brian Hubinger, public affairs manager at Chevron Richmond. “We felt the most efficient way was to bring together a broad selection of community members rather than just think about what it would take to comply with the settlement agreement.”

The first town hall drew a few dozen members of the community, including Chevron employees, representatives of fence-line neighborhoods and members of local environmental organizations.

During the event, Chevron employees reported that 19 BAAQMD-reportable flaring incidents occurred at the refinery from October 2022 to September 2023 with a total duration of 270 hours. During the same period this year, 18 flaring incidents occurred with a total duration of 159 hours, marking a 41% decrease in duration.

Further gains are expected with the implementation of Flare IQ, set to be installed this year and next on all of the refinery’s flaring systems. Flare IQ is described as a supercomputer with an algorithm that gathers data from operations and enables employees to address potential issues before they occur.

Chevron also reported a 40% decrease in particulate matter emissions since the completion of the refinery modernization project in 2018.

In addition, flare gas volume related to Chevron’s new hydrogen plant project, built as part of the modernization project, decreased by 85% since 2019. The hydrogen plant has also reportedly made the refinery 20% more efficient.

“We’re really proud about that,” said Kris Battleson, manager of health, safety and environment at Chevon Richmond.

Neighborhood council leaders joined the president of the local NAACP in lauding the effort toward transparency and accountability. Among them was Vernon Whitmore, president of the Sante Fe Neighborhood Council and member of the 15-person CAP committee.

“The way we were able to talk openly and freely with Chevron – honestly, bluntly and frankly – while developing this program was very good,” Whitmore said. “And it was something that was well-needed at this time.”

Still, residents are skeptical, including Kathleen Sullivan, a longtime community advocate who also serves on the CAP committee. But she added, “you can’t complain about something and not be involved in the solution.”