Treasurer Pappas: Ramifications of Redlining from the Great Depression Still Felt Today

Lawndale News Chicago's Bilingual Newspaper - Business

A study by the Cook County Treasurer’s Office finds that government-sanctioned, racist housing policies dating back 80 years continue to harm lower-income, mostly minority communities throughout the county. The bulk of distressed properties in Chicago and its suburbs fall into areas redlined by the U.S. government in 1940, or in areas where Black people moved to escape urban blight, Cook County Treasurer Maria Pappas said. Redlining is the practice of denying loans to homebuyers in minority areas by deeming them a financial risk. The term referred to the red shading on maps of urban areas where the federal government, working with lenders, discouraged issuing mortgages. Other findings of the study:

• Homes in redlined areas were nearly three times more likely to be seriously delinquent in property tax payments.

• These neighborhoods continue to suffer from high crime rates and population loss.

• The Scavenger Sale – a decades-old auction system meant to restore properties to productive use – is incapable of filling its mission.

• Latino communities have also been impacted by redlining. More than 6,000 mostly vacant and abandoned properties offered at the 2022 Scavenger Sale are in often-redlined areas with significant Latino populations. The 16th ward on Chicago’s South Side had the highest percentage of vacant and abandoned properties offered at the 2022 Scavenger Sale. Much of that ward had been redlined and 48 percent of its residents identify as Latino.

The Treasurer’s recommendations to return deteriorating properties to productive use include creating a public database of abandoned properties; replacing the Scavenger Sale with a program allowing developers and local governments to receive properties free of financial encumbrances:

Maria Pappas
118 North Clark Street, Room 212 Chicago, Illinois 60602

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