Pimping Millennials & Screwing The Low Income

Pimping Millennials & Screwing The Low Income

From Lofts to Micro Units, watch the Public’s Balance Sheet. To paraphrase an old saying, “If you find yourself stuck in a hole and you want to get out, first stop digging.” If DC as a city really wants to address our affordability crisis, we, the Mayor, and Council have to first find the courage to stop digging the affordability crisis hole. In this case “stop digging” means ending DMPED’s practice of structuring land disposition deals which manipulate public subsidies, often low income, to build overpriced so-called luxury housing transferring public wealth to a hand full of families. These deals have become “Balance Sheet” Brothels in which low and moderate income families get screwed through discrimination and Millennials pimped for their on-demand incomes while wealth building capacity is being siphoned from both. 

This DMPED structured “Balance Sheet Brothel” is best illustrated in the Hill East land disposition deal recently signed by the Mayor and previously unanimously approved by the City Council. If we look at the deal’s Term Sheet and extract the Balance Sheet data you will see that under DMPED’s deal the developer will invest $10 in equity and in 2 years at the end of construction will hold $21M in equity on their Balance Sheet. That is a 2.1M% return on investment in 2 years. Further, the deal is structured to provide the developer with an implicit government guarantee via low income housing bonds. Because of this, the developer assumes minimal risk and collects $8M in fees for their trouble. You don’t have to have a MBA in finance to know if a $10 investment can produce $8M in fees and $21M in equity in 2 years that all the Brothel’s in DC have NOT been closed down. And some pimping and screwing is going on. 

The Mayor and Council can’t honestly approve this Hill East deal as structured and claim to be working to address housing affordability and developing a path to the middle class. This deal and other DMPED deals are structured to do the opposite. Just follow the balance sheet. A high priced so called luxury micro-unit rental or pimped out dorm room is design to transfer future wealth/equity into present day income for the luxury developer, whose development is being made possible/subsidized by public spending financed by long term public debt. When the average Millennial rents one of these units disposal income which could be used for equity producing investments or stimulus into the overall or neighborhood economy instead flows to the hands of a few. If a developer wants to do this take the risk and a Millennial want to rents these fine, but it should not be propped up by my Government using public land, low income housing subsidies and discriminatory housing policies. Government can no longer tell limited options to deal with the affordability crisis, while continuing to do deal like Hill East. 

 It’s time to stop digging and clean-up the DMPED Brothel. Then we can seriously address our affordability crisis and invest for the future. The con of touting education reform as an investment in our children’s future, while mortgaging that future to subsidize luxury units is ethically and morally wrong. And our government needs to get out of this business. I know the world’s oldest profession is not going anywhere, but it should not be the bases of community and economic development in this city. We need real and health economic growth. I know we have the Mayor and Council who can do this, let’s close the Brothel.