Rehab of Chicago High Rises Aims to Lure Working Class

FROM the living-room couch of his small, spotless apartment, Foster Harris looks forward to the day a wrecking ball will demolish the dilapidated Chicago tenement where he and his wife reared a dozen children over 30 years.

The demolition, expected to begin soon at the Henry Horner Housing Project, represents the first step in a major new federal strategy to replace America's vertical tenements with low-rise, mixed-income communities.

Mr. Harris has few regrets about the obliteration of his home. The retired janitor lost two sons at the project, one shot by drug dealers in a stairwell in 1989. Gang violence today keeps Harris inside with the curtains drawn. Still, he hopes that officials will succeed in building safe apartments on the rubble of the huge tenement. ''I'll never have a home, but this might give me a home atmosphere,'' he says.

Federal officials are banking on the trust of residents like Harris as they attempt a bold, cutting-edge experiment aimed at making Horner a model for turning around America's worst public housing.

Since they took over the Chicago Housing Authority (CHA) five weeks ago, the officials have put top priority on the $58 million, five-year Horner renovation, which involves tearing down, rehabbing, and rebuilding hundreds of units.

The government's latest strategy for transforming low-income housing stresses economic rather than racial integration. It aims to break up the isolated concentrations of poverty that officials say have dragged down Horner, on Chicago's West Side, and other projects nationwide.

Most of the 1.3 million households in public housing today have incomes far below the poverty level. The average is $6,100, or 17 percent of the local median. In Chicago, the typical income of resident households is $4,000.

By bringing in more working families, replacing high-rises with low-rises, and linking the projects to more vital surrounding communities, officials expect to improve management and safety while also collecting more rent at projects like Horner.

GOP's new blueprint

This month, House GOP lawmakers will introduce sweeping legislation to free local housing authorities to attract more working families. The proposal would eliminate the federal income caps and scaled rents that since the 1960s have effectively reserved public housing for the very poor.

It would create incentives for unemployed residents to get jobs and move up and out, says Rep. Rick Lazio (R) of New York, one of the measure's architects.

The Republican legislation is also designed to save money as Congress slashes the latest federal housing budget of $31 billion by 20 percent. By loosening regulations and allowing local housing authorities to raise rents, the federal government aims to reduce its $3 billion in yearly operating subsidies for public housing. By law, federal funding for local housing authorities would come in block grants that could be revoked for poor performance.

Plight of neediest

Yet while the strategy is likely to save money and improve housing for some like Harris, it also poses uncertainties for the neediest Americans.

On the one hand, by housing more working families, the policy would increase competition among the poorest Americans for affordable dwellings. Already, there are long waiting lists for subsidized housing. For every household now in public housing, three more, or an additional 5.3 million families, have ''worst-case'' housing needs.

With falling subsidies and pressure to collect more rent, local housing authorities will be more likely to turn away or evict jobless residents, critics say.

''This could lead to massive evictions in a couple of years, at the same time that Congress is cutting off welfare benefits,'' says Wayne Sherwood, a Maryland-based housing consultant. A third of all public-housing residents, and nearly half of the families, depend on public assistance as their main source of income.

Meanwhile, budget cuts will limit the number of new or rehabbed housing units available.

Republicans in Congress and top US housing officials concede that plans to open up public housing to working class families will shut out some of the poorest.

''This is a moral dilemma,'' says Mr. Lazio. He and others contend that turning away some poor people is the price that must be paid to improve the overall quality of public housing and ensure continued funding.

''I would rather have 50 units of housing in a viable community where it is worth living than 100 units in a place like [Chicago's] Robert Taylor homes,'' says Joeseph Shuldiner, the Housing and Urban Development (HUD) official who is leading the federal takeover of the CHA. ''We have to deliver a product that American taxpayers will fund.''

But if fewer of the poorest can reside in public housing, where will they go? HUD's main solution is to offer all public-housing residents vouchers to subsidize low-cost housing of their choice. The policy, based on a smaller existing voucher program, aims to give tenants more mobility while breaking the monopoly of local authortities by forcing them to compete with private landlords.

Vouchers are problematic, however, because a strong ''not-in-my-back-yard'' attitude toward low-income housing restricts tenant choice in many localities.

Even HUD admits that current voucher holders now face ''significant barriers to full and free housing choice, especially for minority participants.'' In Chicago, nearly 90 percent of public housing residents are black.

As a result, poor residents who move out of public housing could simply be reconcentrated in other impoverished areas.

Nationwide, two-thirds of current black voucher holders have moved to areas where more than 10 percent of the residents are poor - compared with less than half of whites.

In Chicago, 70 percent of the 15,000 voucher holders are concentrated in the poorer areas of the city's south suburbs.

''My primary concern is that ... the south suburbs could be asked to absorb a higher level of poverty,'' says Rep. Jerry Weller (R) of Illinois, who represents the area. ''The jobs are not there. We don't want to be a dumping ground for CHA residents.''

Some Horner residents even charge that Chicago housing authorities seek to displace them and demolish parts of the project for political reasons: The gleaming United Center, the site of the August 1996 Democratic convention, is only a few blocks away.

''The convention is coming and they [city officials] don't care where we go,'' says resident leader Mamie Bone.

* Part 1 of this series appeared yesterday.