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Featuring Neal Rackleff, Housing and Community Development Director (HCDD) for the City of Houston

This interview with Neal Rackleff, Housing and Community Development Director for the City of Houston, was conducted and condensed by Mahogany Johnson.

MMJ: What is your vision for the future of your department?

NR: Our vision is to serve as many Houstonians as we can and as efficiently as we can. The two major things that I consider as the Director of the Housing and Community Development Department are 1) to stay focused on who we ultimately serve. Those are the people of Houston with a low to moderate income who need help. We are given stewardship over the funds to assist them and I view that as a sacred stewardship. It’s critically important that we are as efficient as humanly possible in the way we serve folks so that we can serve as many as possible. The other point that is a guiding principle for me is 2) to focus on our department and building a team that can successfully achieve the objectives that we’re pursuing in a very complex, regulatory and political environment. One of the things that we have striven for is trust and transparency in terms of dealing with the public. I believe that in the past it was unclear where the funding was that we were responsible for and how much of it there was. We’ve become highly transparent, and we share information about how our funds are spent with everyone who wants to learn about it. We publish that data on our website. We hold public meetings and forums, and we work actively to be extremely transparent. I think that increases trust with the communities that we serve.

MMJ: As Houston prepares to host Super Bowl LI next year, the city is undergoing numerous improvements. What is your department doing to improve the visual character of the City of Houston?

NR: Most of the funds that we spend must be utilized to serve families who are low and moderate income. A lot of those funds have to be in census tracks or areas where there are low and moderate income people, but we think it’s critically important that the same kind of aesthetic improvements that higher income neighborhoods have are found in Houston areas with limited resources. For example, we’re in the process of building approximately 275 single family homes that belong to people of low to moderate income whose homes were damaged in Hurricane Ike. This initiative is for people who are successful applicants in that program. We’re able to either substantially renovate their home or rebuild them a brand new home. We’ve found that over time it almost always makes more sense to just rebuild a new home because often these are 75 to 100 year old homes. It’s usually best for the family to begin anew; that way they get a better, safer home and it’s better for the environment in that there’s now a brand new home in that community. Rebuilding homes is a large part of what we’re doing to increase the aesthetics of the City of Houston. We’re also conducting an extensive community revitalization effort that produces high quality affordable housing and goes beyond to other elements of the community. We’ve gone through a very thorough process looking at market data and demographic data, and we’ve conducted analysis to find out what communities in Houston are those where we can best strategically use our limited resources to achieve revitalization. We received $178 million in the second round of Hurricane Ike federal recovery funding, and we’re using those funds in a targeted way. Typically, in the past, when we received those kinds of resources they were broadly distributed all over the city. The problem is that Houston is so large that if you spread the resources too broadly, you’ll end up with little result, whereas if you concentrate those resources, you’ll end up with impactful revitalization efforts.

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MMJ: Some question the possibility of urban revitalization without gentrification. Please share some of the latest housing and community development initiatives taking place within your department with regard to revitalization and residential mixed-use developments.

NR: We have four major initiatives which are targeted revitalization, homelessness, community economic development and public services. We took a retroactive look at how we have allocated our dollars for these initiatives over time. Almost $700 million went into the different initiatives since 2010, approximately $178 million of which was federal disaster recovery funds from Hurricane Ike. In our multi-family program, we created 10,554 units of affordable housing in Houston. To do that, we invested almost $284 million into projects where private developers added $730 million. That’s over $1 billion we’ve helped add to the Houston economy. So when people ask, “Can you stem the tide of gentrification or displacement due to gentrification?” The answer is yes, but it takes resources and you must be strategic in where you place them.

We are targeting our resources into community revitalization areas, which I’ll refer to as our CRAs, which were selected through an extensive public engagement process. These CRAs include the Fifth Ward area, Near Northside and the Old Spanish Trail (OST)/South Union neighborhood. In each of those CRAs, we’re building or rebuilding a lot of single family homes. We’re building high-quality multi-family homes as well. An example of that is the Village at Palm Center development that is currently under construction in the OST area. We engaged in a public-private partnership with a developer who bought the old King’s Best flea market and demolished it, eliminating blight. They are building a beautiful mixed-use community with 222 units, including apartments and townhomes, and it has about 15,000 square feet of retail space on the ground floor. Most of that will be affordable housing and some will be market rate. It’s located across the street from the Palm Center and the Houston Texans YMCA. Cattycorner to it, there is a new City of Houston library under construction. The OST Tax Increment Reinvestment Zone (TIRZ) has funded that library, but we helped the TIRZ by putting $3 million into a street infrastructure project that the TIRZ was undertaking on Dowling Street parallel to Emancipation Park. That allowed the TIRZ to free up resources so they could put money towards the library.

All of our CRAs are gentrifying. Land prices are increasing and low to moderate income residents, to varying degrees, are pressured by higher rents or higher taxes if they are homeowners. The affordable homes and apartments we’re building are helping residents avoid displacement due to gentrification. In the OST neighborhood, the Village of Palm Center is adding high quality affordable housing that will remain affordable for the next 20-40 years. In the Near Northside, we have two mixed-income developments, Hardy Yards and Avenue Station, which will add 418 units, 234 of which will be affordable. Avenue Station, which is a reconstruction of a vacant office property, will also be eliminating blight. In the Greater Fifth Ward, we are helping to renovate the 284-unit Cleme Manor apartment community, which had become a serious crime problem for the neighborhood and is now under new ownership that has turned it around. Plus, we are working with a developer that will be building clusters of single-family homes, town homes and duplexes in the Fifth Ward. These 164 rental units will be centrally managed and maintained similar to multifamily properties.

When we help people, we want to help in a way that recognizes the worth and dignity of every individual that we serve. For example, when we build a single-family home, we want it to be beautiful aesthetically and architecturally. We want it to be an improvement to the community where it is, but also blend into the community’s character. In most disaster recovery programs, you get a few home designs that are boxy and standard looking. I wanted to ensure that 30 years from now when someone is driving down the street, they’re able to acknowledge a beautiful home that the City of Houston contributed to the neighborhood.

For our disaster recovery single-family home program, we brought in a Dallas architectural firm called BC Workshop that focuses on lower-income communities. They conducted a design charrette where we included families from targeted neighborhoods who were applicants in the program. The families sat down with 16 architects who asked very specific questions such as, “How do you use your backyard?” and “What architectural motifs in your community are important to you?” The architects then left and later returned to showcase a gallery that featured 26 different designs. The program participants were able to vote in real time on the designs. Of course, it took a little more effort and time on our part to complete, but the response we received from families participating in the program was profoundly heartwarming. The homes turned out beautifully because they were designed to reflect themes from the neighborhood where they exist and the preferences of the people who will be living in them.

MMJ: According to a recent Houston Chronicle article, the city council later this year will consider allotting $3 million for the land acquisition and pre-development costs that will go towards the development of affordable housing. Please share your insights on how this project will materialize?

NR: This was just one of a number of projects in our pipeline. Currently, we’re working on five multi-family affordable housing developments where we’re contributing $52.4 million and leveraging $168 million in total investment. We’re engaged in revitalization efforts that are probably broader and deeper and more targeted than anything the City of Houston has previously undertaken in partnership with the development community.

Another big initiative that we’ve undertaken is alleviating homelessness. Our department has infused $102 million into our homeless initiatives: $62 million in construction of permanent supportive housing for the homeless and $40 million in services. That’s just our department’s investment. This has been a unified and cooperative joint effort between the City of Houston, the Houston Housing Authority, Harris County Housing Authority, Harris County Community Services Department and a number of partners from both the non-profit and for-profit communities.

The results have been pretty remarkable. Chronic homelessness in Houston has dropped 70% since 2011; overall homelessness is down 46%; and downtown homelessness has dropped by 50%. We’ve generated over 2,500 units of permanent supportive housing, which means you provide a rental subsidy and social services to help address the physical, mental or behavioral issues that contribute to homelessness. In the past, shelters and homeless programs had zero tolerance rules that required the homeless to solve all of the problems that led to them living on the street, or they would get put on on the street again. That’s proven ineffective.

The new model is called “housing first,” and what we do is take the homeless from the street and immediately place them in an apartment without requiring them to get sober or drug-free. Once the person is in stable, safe housing, they can better address their addictions, mental issues or physical health issues. And the supportive social services to help them are onsite, which has proven to be a highly successful model.

Houston and Harris County have received a lot of national attention for the good work that’s going on here. We have been integral in housing 2,744 chronically homeless individuals and 3,917 homeless veterans since 2011. In fact, we are the largest city in the country to effectively end veteran homelessness. Houston and New Orleans were recently recognized by President Obama as the first cities to achieve this milestone. What we mean when we say “effectively ending” homelessness is that if you’re a homeless veteran in Houston, there is a home available if you choose to take advantage of it.

The concept of “ending” homelessness can be confusing to the general public and not a very accurate statement because there will always be people who have lost their homes. Our goal is to have a system in place to rapidly rehouse anyone who is without a home. What Houston and other cities have found is that the faster you can get a newly displaced family back into housing by assisting them with deposits and rent, the lower the probability is that they will become chronically homeless. Rapid rehousing is something we put a lot of emphasis on because it’s the most effective way to avoid chronic homelessness.

While it sounds like it would be expensive to place the homeless in housing and cover the costs of their rent, for the chronically homeless we calculated that between the City of Houston and Harris County, we were spending about $103 million a year for things like jails, legal costs and emergency room services for the chronically homeless who continually cycle through the system. It’s incredibly expensive. Over a three-year period, we spent $102 million to develop the system for alleviating chronic homelessness, which is a far more sustainable and successful approach.

MMJ: How does the Housing and Community Development Department (HCDD) increase public awareness and what has the response been from citizens on how you inform them of your progress?

NR: HCDD makes a considerable effort to engage communities in need and forge relationships to include community leaders in the process as well as residents. When we identified our Community Revitalization Areas, we went through what I would consider an unprecedented community engagement process. We planned and hosted 13 community meetings attended by over 500 unduplicated participants. We asked participants to help us narrow our focus and find target areas that are strategic and where we can achieve comprehensive revitalization and racial integration, and avoid displacement due to gentrification. We had community meetings where members of the community showed us the areas of community they felt needed to be revitalized. Community members were encouraged to discuss problem areas within their communities, and we gleaned insight through that public participation process and included it in our request for proposals that we sent to the multi-family developers. We notified developers that we wanted their plans to be informed by what the community would like to see happen. An example of this is the Village at Palm Center, which I mentioned earlier. There was a blighted flea market on that site and people wanted it gone. Now, there’s beautiful housing under construction in that location, and it’s achieving the community’s objectives. We work really hard to engage and communicate with the communities that we’re serving in an effort to involve them in the process directly, but also achieve a result that they will feel ownership of and that will benefit their lives.

MMJ: What advice would you give to budding professionals looking to break into your field of work and what qualities do you look for in a potential candidate?

NR: I’m a lawyer, and the thing that I did that helped me most as a law student and aspiring professional was to talk to as many lawyers as I could and ask them what they liked and disliked about their job. I was interested in working for a governmental entity so I had conversations with lawyers who worked for the district attorney’s office, and it was very interesting to hear what they liked about their jobs. Then I spoke to people who worked at big law firms and most of them hated their work, which was bizarre because they were making so much money. I would study real estate development trends and there’s a lot of good information online that covers high-quality affordable housing and permanent supportive housing and the whole “housing first” movement and the homelessness world. There’s a lot of great information out there that you just need to dive into and figure out, but mainly I would say, talk to people who work in those fields you may be interested in and learn all you can from them.

MMJ: How do you get people on your team to live your leadership philosophy?

NR: Primarily, it’s by utilizing a servant leadership model. We serve families in Houston and when we remember and stay laser focused on that fact, it helps us to keep perspective – especially when dealing with a complex array of funding sources, with complex strings attached to them. I’m able to make sense of all that we do by focusing on the ultimate customer. Also, I think it’s important as a manager for the folks that work for and with you to know that you care about them and are interested in their growth and development as well. I want to see the good people in our department grow, develop and succeed in their current roles, and go on to bigger and better things in the future. I think if you approach people from that perspective, try to hire people that are smarter than you are, aren’t insecure or feel threatened by others around you, but instead become a cheerleader for those that succeed, great things can happen.

MMJ: Employees typically perform at their best when the environment is conducive to growth. What growth opportunities are available within your department?

NR: In this department, great things are happening. We’ve got a lot of dedicated staff members here who work hard to provide services for people in need. I’m constantly amazed at how bright, hardworking, and compassionate the folks are that are a part of our team. I view my role as being a cheerleader for the department, and I want to help the people who work in my department to succeed on every level. It’s been super gratifying to watch people in this department soar, grow, and develop in amazing ways. We work in a very intense political environment so it’s critical that the folks know that their leader has their back when political pressure is brought to bear on the organization. They want to know that you are not going to drop them in the grease to save your own skin, but that you will take responsibility for the good and the bad. As a leader if those whom you are attempting to lead don’t trust you, then they’re not going to follow you. You ought to do everything you can to encourage the growth of those who work with you, and you have to back them up. I decided early on in my career that if I made a mistake I was going to own up to it, and hopefully the mistakes are few and far between. In my career, I’ve found that being honest about my participation when things go wrong has contributed tremendously to my managers trusting me. If they know that you’re going to give them the straight scoop when there’s a problem, they’ll want to come to you again, but if you conceal things and don’t take ownership of a problem, that engenders distrust. Transparency has a lot to do with trust as well. People may not always like my decisions, but I don’t hide the ball and when I’m negotiating a real estate transaction or interacting with folks on the staff, you can see my train coming a mile down the track. You may not like the direction it’s going, but I try to be transparent and forthright with what we’re doing and that usually results in an in-kind response from people.

MMJ: Tell me about a time you realized you had the power to do something meaningful.

NR: I’ve had a lot of impactful experiences in this position, but one incident in particular was when a tornado hit an apartment complex called the Rockport in SW Houston. At the time, my wife and I were headed to church when Harry Hayes, the chief operating officer and solid waste director of the City of Houston, called me and told me about this situation and requested my help. So, my wife and I quickly took communion (because I felt like I needed the strength) and then we went to the location where we were faced with several hundred apartment units that had been damaged to the point that people couldn’t safely return to their homes. The manager and owner of the complex were nowhere to be found. This was a complex where most occupants were lower income and non-English speakers, so there was a language barrier. We had hundreds of people that needed a place to stay that night. The fire chief, Harry Hayes and one of the head HPD captains were present at the site, and then Harry Hayes turned to me and said, “I guess you’re in charge, Neal.” It was a beautiful thing to see all of the different departments of the city working together and it was remarkably smooth given how complex the situation was. Everyone involved did a phenomenal job and Houston METRO sent four buses to transport the people to the shelter that the Red Cross had established at the Chinese Community Center. There was so much good done that day and we helped the residents of the complex in dealing with the landlord who didn’t show up for several days. The biggest concerns for the residents were that they would have a bad mark placed on their credit and having to pay the rest of the month’s rent in spite of not being able to inhabit their units because the Fire Department and Public Works and Engineering had deemed them unsafe for human habitation. The city attorney’s office, then-Mayor Annise Parker’s office and I worked to ensure that the residents were not taken advantage of by the owner. It was great to see so many of the city’s resources brought together to help a group of people who were in such dire need.