Study: Effects of redlining in Chicago and suburbs continues to perpetuate blight in many communities
CHICAGO (CBS) -- A new study released Tuesday shows an 80-year-old law meant to put rundown Chicago properties back to use has done little to help racial inequalities in the city's Black and Latino communities.
The study says the majority of distressed properties in Chicago and the Cook County suburbs falls into areas that were redlined by the federal government in 1940, or in areas into which Black people moved to escape urban blight, Treasurer Maria Pappas said in a news release.
Redlining is defined as the practice of denying loans to homebuyers in minority areas by proclaiming them a financial risk. Maps had such areas literally shaded in red.
"Redlining may be illegal now, but housing discrimination still exists," Pappas said in a news release. "Today's problem of abandoned properties and boarded-up businesses is a blister that's been festering for 80 years and needs a lancing. This study is meant to be the needle."
The study also found that homes in redlined areas were three times more likely to be far behind in tax payments. Such neighborhoods also suffer from high crime and population loss, the Treasurer's office said.
Similar patterns have been seen in other cities, including Detroit and Philadelphia, which also struggle with urban decay and Black residents leaving, the Treasurer's office said.
The Treasurer's office said the Scavenger Sale – a longstanding auction system intended to restore blighted properties – does not live up to its own mission.
The Treasurer's office noted that Latino communities are also affected by redlining. More than 6,000 mostly vacant and abandoned properties are in often-redlined areas with large Latino populations – including the 16th Ward on the city's South and Southwest sides, which had the highest percentage of vacant and abandoned properties go up for auction in the 2022 Scavenger Sale, the Treasurer's office said.
The Treasurer's office suggests eliminating or changing Illinois' Scavenger Sale law, and replacing the Scavenger Sale with a program that allows developers and local governments to receive the properties free of financial encumbrance so as to redevelop them more quickly.
The Treasurer's office would also like to see a list of abandoned properties option to the public, and lower interest rates for delinquent property tax payments from 18 percent to 9 percent per year.
