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To Build or Not to Build

As Alderman Jesse Granato slugs it out with a developer, some low-income residents get lost in the shuffle.



By Kari Lydersen

Hearing the name Bicker-dike, First Ward alderman Jesse Granato scowls and reaches behind his desk for a ward map. His voice rises as he points to the red pins dotting the map that indicate the 450 properties owned by Bickerdike Redevelopment Corporation, a nonprofit developer of affordable housing in West Town, Humboldt Park, and Logan Square. The map is also dotted with blue pins that show the locations of CHA scattered-site subsidized housing. He almost trips over his words as he condemns the proliferation of subsidized and low-income housing in his ward.

"I used to live next to a Bickerdike property," Granato says. "Last summer I was out barbecuing in my backyard and I heard shots--boom, boom, boom--next door. There was a 15-year-old kid shot. I had to put a tourniquet on his arm. Imagine, an alderman putting a tourniquet on a 15-year-old kid! There would be 20 or 30 people smoking marijuana on my stoop. Bickerdike didn't control the building--the Vice Lords did."

Granato rises out of his chair. "And there was Edna De La Rosa, an elderly woman gunned down on Fry Street last summer. One of the suspects lived in a Bickerdike building!"

The staff at Bickerdike don't like Granato any better than he likes them. In December the company filed a lawsuit against the alderman, a response to charges he'd made in a July press release, which he'd issued after Bickerdike brought about 100 pajama-clad protesters to his office one night. "On July 27, 1998, Jesse Granato published the following false and defamatory statements," the suit reads. The statements include: "The killing of 7 year old Nikia Terri was partly the result of Bickerdike's non-caring attitude." "Bickerdike has discriminatory hiring practices and does not hire African-Americans." And "Bickerdike residential units are infested with gangs and drugs."

The statements are actually from a letter sent to Granato by Humboldt Park CAPS beat facilitator Mack Payton, which Granato distributed along with his press release. Payton says he hadn't known Granato intended to distribute his letter. Granato calls the lawsuit, which will be decided by a jury sometime this winter or spring, an infringement on his First Amendment rights. The suit states that he "published the above-listed statements with actual malice and reckless disregard to their truth or falsity." It asks for $30,000 in presumed damages and $50,000 in punitive damages.

The pajama protest had been part of an ongoing battle over Bickerdike's proposed Erie Cooperative project, which is at the center of the dispute between Granato and Bickerdike. For more than four years Bickerdike has been trying to build the co-op, which would include 30 units of low-income housing, on what are now Bickerdike- and city-owned lots within a few blocks of Chicago and Noble in West Town--and for almost as long Granato has been stridently opposing it. Some low-income residents beg for the co-op as a refuge against displacement in the rapidly gentrifying area--it would house working families making between $15,000 and $30,000 a year--while other residents echo Granato's complaints that there's already too much low-income housing in the ward and that Bickerdike's buildings are crime ridden.

Linda Contreraz, driven by a fire out of the West Town house where her family had lived for five generations, was one of several local residents who came up with the idea for a co-op six years ago. Working through the nonprofit social-service organization Erie Neighborhood House, they formed a steering committee of would-be co-op residents in 1992 and named Bickerdike as their developer.

The committee sent its first proposal to the Chicago Department of Housing in 1994, describing the project as a limited-equity co-op for 50 families on lots donated by the city, with prospective residents forming a corporation and buying shares for $2,000 each. Construction would be paid for with loans from the city's Department of Housing, the state Housing Development Authority, and private organizations. The idea was well received. Granato, then an aide to Alderman Terry Gabinski and an aldermanic candidate, told the steering-committee members that he would support the project if that's what the community wanted. He put the issue on the February 1995 ballot as a nonbinding referendum, and it passed with 56 percent of the vote.

But then the city decided not to give the co-op as big a loan as the steering committee wanted. In 1995 the city asked Bickerdike to change the ownership structure to a limited partnership so that the project could qualify for the federal Low Income Housing Tax Credit program, which is administered by the city with the goal of creating public-private partnerships. Only tax-paying corporations can take advantage of the LIHTC, so the co-op would have to find a private investor who wanted the credits to lend the money for construction, though the project would still get city, state, and other private loans. Residents would manage the co-op from the start, but they wouldn't own a piece of it for 15 years.

The co-op steering committee agreed to the proposal. "We didn't think it was a big deal at all," says Contreraz. "We just wanted to be able to have affordable housing in West Town."

Bickerdike applied for the tax credits, almost all of which would go to the private investor, and by April 1996 the city's Department of Housing had awarded the credits and was prepared to provide the co-op with a loan--contingent on Granato's support. He refused to give it, and in September he told the steering committee that he would prefer to see a mixed-income condo development on the lots.

Granato says he withdrew his support because the project no longer resembled the one that had been described on the ballot. "Bickerdike would be the major owner. They could never actually show that these folks would ever own anything. It was a totally different proposal. You can't sell me a Toyota and then give me a Chevy and expect me to be happy."

Joy Aruguete, executive director of Bickerdike, points out that after Granato's about-face Bickerdike offered to forgo the tax credits and resubmit the proposal as a limited-equity project. Granato denies that he was ever told that.

Later that spring Contreraz started seeing flyers accusing Bickerdike of a bait and switch and of "duping" the co-op steering committee. She insists the committee was fully informed and eager for the project to succeed. "They were saying all this stuff about deceiving 'the people,'" she says. "We were 'the people,' and we just wanted to be able to stay in the community that we built with our own sweat over all these years."

There was no name on the flyer, but Contreraz believes it was created by Brian Boyer, president of the Eckhart Park Community Council. "Bait and switch is definitely the way to describe what they did," says Boyer. Asked about the flyer, he says, "I don't think I can remember back that far."

Granato claims that supporters are still calling the project nonprofit, though he says Bickerdike will make money from the deal. "They say they are a nonprofit," he says. "Ha-ha! You call the Humboldt Construction"--a for-profit subsidiary of Bickerdike that builds the parent company's housing--"phone number and Bickerdike answers. The president of Humboldt Construction is the former director of Bickerdike. It's all about money for Bickerdike."

Aruguete says it's no secret that Humboldt Construction builds Bicker-dike's projects. But, she says, "There's no one making money off it. It's all in our annual reports. Bickerdike owns all the shares of Humboldt. It's a job-creation and economic-development tool." Bickerdike, she adds, is a 501(c)(3) nonprofit organization. "It's structured like every other nonprofit. It has a 100 percent volunteer board of directors, which is the main distinguishing characteristic of a nonprofit. The board is elected by the community members. You have to live or work in the community to be a member."

But Granato says he has lots of reasons to oppose Bickerdike as a developer. "I have a responsibility to my taxpayers to protect their interests in the city of Chicago," he says. "They have not cleaned up a lot of their buildings, they don't control their own property, they don't have security. I'm surprised the city hasn't shut them down."

Aruguete says there are some problems in Bickerdike buildings, but adds, "Anyone who manages 750 units will have problem tenants. We do screenings and require landlord references. Our buildings are well maintained. We don't have any deferred maintenance." Moreover, she points out, in 1997 Bickerdike was named not-for-profit development group of the year by the Chicago Neighborhood Development Awards, which are sponsored by banks and the state Housing Development Authority, among others, and in 1998 it received an "exemplary" rating for maintenance from the federal Department of Housing and Urban Development.

Granato points to high numbers of 911 calls from some of Bickerdike's buildings--he has a 21-page report listing them--as evidence of crime problems. Between January and October of 1997, 43 of the properties listed were the source of more than 20 calls each. Two properties had more than 100.

Aruguete responds that only a small percentage of Bickerdike buildings have high numbers of 911 calls, and she doesn't see the calls as necessarily a bad thing. "I'd be thrilled to hear our tenants are calling 911," she says. "It means they care about the community and what's happening. That's great if they're calling the police."

But some residents maintain that crime is a big problem in Bickerdike buildings. Maria Pagan, who lives at Washtenaw and Potomac, near some Bickerdike buildings, says, "I've seen a lot of gang and drug activity there. I think [the Bickerdike staff] make an effort to do something, but there's not much they can do. They say they have to catch people in the act." Brian Boyer says, "It has gotten better, but Bickerdike will have tenants in gangs, or tenants who are young women with boyfriends in gangs, or grandmothers and mothers whose sons are in gangs. You need to move out those problem families if you want the area to be safe for the remaining children."

Yet officer Joe Torres, who works in neighborhood relations at the 14th District, says he hasn't noticed any particular problems with Bickerdike properties. "Nothing I could put my finger on," he says. Spokesmen from the 13th District and the police department's public-relations office say they don't have any information or statistics on Bickerdike.

The First Ward has the highest number of scattered-site subsidized buildings of any ward in the city, and Granato and the representatives of the home owners' associations that agree with him--including the Old Wicker Park Committee, the Eckhart Park Community Council, and the East Village Association--say they shouldn't be forced to absorb any more. "When you continue to dump low-income housing in one area you create a new ghetto," says Dave Stumm, president of the Old Wicker Park Committee and a vocal opponent of the co-op. "You have to put yourselves in the shoes of someone who would be living across from it--it could be another potential Cabrini Green."

Aruguete agrees that West Town does have a high concentration of Section 8 scattered-site subsidized housing, yet she points out that this kind of housing is nothing like the high-rise projects concentrated in other wards, and besides the co-op wouldn't be Section 8 scattered-site housing. Moreover, the apartments would be designated for current or recently displaced residents of the community, so no new low-income tenants would be brought into the neighborhood.

Granato repeatedly denounces the co-op as subsidized housing, though the new plan is no more subsidized than the plan that was on the ballot. Bickerdike staff suspect he's simply opposed to any form of low-income housing. But Granato insists that he supports affordable housing, pointing to 18 affordable rental units and 18 affordable homes that he's pushed to have built in his ward. He says the rental units would go for about $900 a month for a two-bedroom, and the homes are intended for first-time buyers making $30,000 to $60,000 a year.

Aruguete says these units aren't as affordable as those in the proposed Erie Co-op, where a one-bedroom would cost $375 a month, a two-bedroom $450, and a three-bedroom $525. Moreover, some of that money might go toward an ownership share in the co-op.

The staff at Bickerdike believe that recent home buyers simply want Bickerdike's residents and the blighted past they represent out of the neighborhood. "As newcomers have come into the community," says Aruguete, "one of their objectives is to use their houses as investments and protect the value of the land. The perception is that the only way to do that is for the housing stock to turn over and appreciate. Low-income people will impede that process. They know Bickerdike has no intention of selling land, so we keep it from turning over and appreciating."

Bickerdike staff and would-be co-op members describe the home owners' associations that oppose the co-op as elitist groups that represent the interests of only a small percentage of the neighborhood but carry a lot of weight with Granato. "They seem to have a very powerful collective voice in the community, but they don't seem to be representative of the community," says Lisa Arnold, a senior organizer at Bickerdike. "When we've gone to their meetings there are very few people of color, and you seem to overwhelmingly hear the opinion of developers."

Contreraz says, "Granato takes everything to those groups and calls it a community process. They're not democratic at all. I tried to join the Eckhart Park Community Council for years, but first you have to be sponsored by someone in the group, then they vote on you, then you have to pay a fee to join."

"All of the above is true," says Boyer. "We will not permit ourselves to be taken over by busloads of people they would bring in who will shout and jump up and down until they get what they want."

Contreraz says these organizations' attacks on Bickerdike are part of their campaign against low-income housing. "They're just trying to make Bickerdike look bad," she says. "It makes me really mad because I know how good they've been to us, how much they care about us. When we go to [home owners' association] meetings, if anyone from Bickerdike's there they start slandering Bickerdike. Lisa will give me a ride to the meetings, and right after the meeting she'll drive to all the buildings they talked about--and there's never anything wrong with them."

Last year the funding secured by the steering committee back in 1994 expired, and in November they resubmitted the proposal to the DOH. Wanting to get the development under way whatever it took, the steering committee cut the number of units to 30 and agreed to leave the proposal open-ended, so that the project can now be any type of affordable housing the DOH will fund, including a simple rental development. The city is reviewing the proposal and has promised to respond by the end of February.

Granato still says he won't support the project, especially now that he's facing a lawsuit. "I think they filed a lawsuit against me hoping the attorneys would keep me quiet," he says. "But I'm not going to let them challenge my rights. I believe I should be able to have my say and protect my community."

Contreraz says she too is determined to keep fighting. "At these meetings Granato looked like he felt a little guilty," she says. "I can only hope he honestly reconsiders what it means to serve his constituents--all those who voted for him and not just the rich few. This isn't something we can give up on. We're fighting for the right thing, for what we deserve."

Art accompanying story in printed newspaper (not available in this archive): Jesse Granato/ Joy Aruguete photos by Nathan Mandell.

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