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Poverty, Politics and Profit (full documentary) | FRONTLINE

FRONTLINE PBS | Official・38 minutes read

The affordable housing crisis in America is severe, with many struggling to find housing despite federal assistance programs like Section 8 vouchers. Investigations reveal financial scandals and fraud in the affordable housing industry, highlighting the need for increased scrutiny and accountability.

Insights

  • Many Americans struggle to find affordable housing, with only one in four individuals in need of housing assistance actually receiving it, reflecting a national crisis with severe consequences like rising rent prices and declining incomes.
  • The affordable housing market, supported by programs like Section 8 vouchers and Low-Income Housing Tax Credits, faces challenges such as fraud schemes and declining production rates despite high demand, highlighting the need for increased scrutiny and accountability to ensure the effectiveness of these initiatives.

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Recent questions

  • What is the current housing crisis in America?

    Many Americans struggle to find affordable housing, with only a quarter receiving assistance.

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Summary

00:00

Affordable Housing Crisis in America

  • Americans are facing a housing crisis, with many struggling to find affordable housing.
  • Only one in four individuals in need of housing assistance actually receive it.
  • Frontline and NPR investigate the affordable housing crisis.
  • Laura Sullivan's investigation leads her to Costa Rica, uncovering hidden financial dealings.
  • In Dallas, the affordability crisis is severe, with rent prices rising and incomes declining.
  • Over 40,000 evictions occur annually in Dallas, reflecting a national crisis.
  • Millions of families, like Carla Powers', were affected by the 2008 financial crisis, leading to a rental affordability crisis.
  • The federal government spends nearly $50 billion annually to assist the poor with rent.
  • Section 8 vouchers, a key program, cover only a fraction of those in need, with waitlists lasting years.
  • Individuals like Farryn Giles, Linda Higgins, and C'Artis Harris struggle to find housing despite receiving Section 8 vouchers.

12:12

Challenges in Affordable Housing Development in Frisco

  • Frisco City Council voted against helping Anderson get the money she needed in March 2015.
  • Anderson managed to secure loans and grants to proceed with construction despite the lack of local support.
  • Anderson faced threats and police interference during the construction process.
  • Frisco city officials clarified they support affordable housing but require compliance with building rules.
  • Anderson reported the situation to the Department of Housing and Urban Development for investigation.
  • The incident at a McKinney pool party highlighted racial tensions linked to housing issues.
  • Historical federal policies in the 1930s and 1940s led to housing segregation and urban poverty.
  • The Fair Housing Act of the 1960s aimed to combat housing discrimination and promote integration.
  • The Section 8 voucher program and Low-Income Housing Tax Credit were introduced to address housing needs.
  • Developers like the Potashniks utilized tax credits to build affordable housing, facing opposition and legal issues.

25:44

"Chicago Tax Credit Industry: Affordable Housing Challenges"

  • Annual gathering in Chicago for the tax credit industry involves various players like bankers, brokers, law firms, consultants, and developers.
  • Housing tax credits have aided in constructing over 2.5 million affordable units in the past 30 years, costing around $8 billion annually.
  • Despite the growing cost of the program, it hasn't met the increasing demand for affordable housing, leading to a thriving market.
  • Stacie Nekus, a vice president at a major brokerage firm, highlights the robust nature of the affordable housing market, attracting investors due to good after-tax yields.
  • The tax credit program is viewed as mutually beneficial, providing quality housing for low-income individuals while allowing the private sector to profit.
  • Analysis reveals a decline in the number of units produced from over 70,000 to less than 59,000 between 1997 and 2014, with a 66% increase in tax credits.
  • Industry representatives attribute the drop in production to various factors like the loss of federal funding and increased costs to assist the poorest renters.
  • Investigations uncover a kickback scheme in South Florida involving two companies, Carlisle and Biscayne Housing, stealing $34 million from 14 projects.
  • The scheme involved inflating construction costs to secure more tax credits, with millions funneled through secret accounts and fake construction companies.
  • Despite the scandal, some officials believe such incidents are rare, while others argue more scrutiny and accountability are necessary in the affordable housing industry.

39:04

Fraudulent Scheme Uncovered in Pinnacle Projects

  • DAXC was used to hide extra profits from Pinnacle projects
  • DAXC Company shares an address with Florida developer Pinnacle
  • DAXC was reported to have not done any actual work
  • Sherwin charged DAXC with stealing federal tax credits
  • DAXC admitted to inflating costs by over $4 million on four projects
  • Daxc Jimenez, a person in Costa Rica, was found to be associated with DAXC
  • Pinnacle was accused of using DAXC for fraud in affordable housing projects
  • Florida's housing agency took legal action against Pinnacle for fraud
  • Challenges faced by individuals trying to use Section 8 vouchers for housing
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