Experts say these are the top 5 barriers to affordable housing in rural Alabama

A town of 221 people called Newbern stretches across 1.2 square miles in rural Hale County.

By many accounts, it is a standard Black Belt town. About 34% of the population lives below the poverty line, the median age is 50 and it’s a majority Black community. However, Newbern also has a library, a restaurant open for lunch and dinner most days, an operational volunteer fire department and several recently renovated, healthy homes.

Those 221 people have places for community building, many of which Auburn University’s Rural Studio made possible.

In 1993, Samuel Mockbee and D.K. Ruth founded Rural Studio for Auburn students to design and build architecture projects in West Alabama, an area that lacked stable economic investment. Since then, Rural Studio has brought hundreds of thousands of dollars to the area through grants and materials donations, and executed over 100 design-build projects.

Even with those massive investments and the nationwide attention that Rural Studio has brought to the Black Belt, quality, affordable housing problems persist in the region.

Last week, experts on rural America gathered in the Newbern Library to discuss regional barriers to affordable, resilient housing and the opportunities Alabama has to address them.

“You see the power that housing can mean when it’s done right,” President of the Federal Reserve Bank of Atlanta Raphael Bostic said. “There are a lot of places that need this to be gotten right, and they’re not as far along, I don't think, as this area is.”

Here are five top problems in the Black Belt and what the experts say are potential solutions.

1. ‘Rural communities don’t always benefit from federal resources.’

Many housing programs in the United States were not created with rural communities in mind.

“Rural communities don't always benefit from federal resources. I know that's like a no-brainer here, but it's shocking. I'm working with folks who are concentrating almost all of America's housing policy on suburban and urban places,” Housing Assistance Council president David Lipsetz said. “There's probably a reason that people in Newbern and other places of this size and scale get a little upset sometimes or maybe don't even think that the government works for them.”

One example he gave was the Community Reinvestment Act, enacted in 1997 to stop discriminatory lending practices. The CRA gives borrowers in low- and moderate-income areas a CRA credit for bank lending. Essentially, CRA incentivized banks to equally lend in their assessment areas.

“The issue that was not thought about much at that point is if you're not in that assessment area, you don't have a bank branch within 30 miles of Newbern or you barely have an ATM anywhere close by, you're not going to get a single dollar willingly brought to you for CRA,” Lipsetz said. “Black and brown communities were not seeing those dollars in urban places before CRA, and the unintended consequence is that, now, the delivery was biased against places like this.”

Banks are closing their branches and leaving rural places at an alarming rate, which makes finding affordable lending in rural areas more difficult. Banks closed about 7,500 locations between 2017 and 2021, and one-third of those closures were in a low- to moderate-income area or a majority-minority neighborhood.

The proposed solution to the problem that experts discussed in Newbern was to restructure and expand existing federal programs to address the specific needs of rural communities.

Other groups, like the National Community Reinvestment Coalition have also called for the government to modernize CRA. One of the coalition’s suggestions is to expand CRA to cover nonbanks offering banking services, like credit unions.

2. Heir property keeps individuals from being productive with the land they already own.

The concept of “family land” is common throughout the Black Belt and generally in the South. However, problems arise when that land is passed on through generations without being legally deeded to new individuals. If a landowner dies without a will, ownership of property becomes heir property, divided among surviving heirs in order of closest relation.

“That lack of clear title creates all kinds of problems getting access to government programs, including USDA housing programs, and has until very recently had obstacles in the face of getting disaster assistance through FEMA, not to mention commercial mortgages,” said Conner Bailey, Auburn University emeritus professor of rural sociology. “Sometimes you have 200 people who own a piece of land, a piece of property, a house. Being able to do something with that land productively, to sell timber or repair your home, is a challenge.”

Heir property can prevent banks from making loans and stop insurance companies from issuing policies, as well.

Bailey’s suggested solution to this problem is increasing education on the topic and providing these communities with better access to legal services.

The U.S. Department of Agriculture operates its Heirs’ Property Relending Program to do exactly that, and it began expanding earlier this year.

Through this program, the USDA provides eligible lending institutions with loans at a 1% interest rate to give to heirs. The heirs may then use that money to resolve title issues.

Once heirs obtain legal title, they can become eligible for other USDA programs, loans, grants and other U.S. government resources.

3. Many Black Belt towns don’t have the infrastructure to attract industry and provide living wages.

The Black Belt lags behind the rest of the state in terms of both business and gross domestic product growth, according to a 2020 report from University of Alabama’s Education Policy Center. This slow growth, if any at all, results in communities with some of the lowest personal income per capita in Alabama.

When residents don’t have adequate personal income, they can’t afford adequate housing, even when credit unions and other institutions try to work in their favor.

“The cost to build the house is the same no matter where you do it. But if you go into the Black Belt, if you go into the Mississippi Delta, with the wages and the income of the folks there, whatever it costs per square foot to build the house there, it’s not affordable,” senior vice president of HOPE Credit Union Phil Eide said. “We try to reduce the rate. We try to reduce the cost of building, but we can only squeeze so much, and in the end, there's a gap.”

University of South Alabama civil environmental engineering professor Kevin White thinks that until Black Belt communities fix their infrastructure problems, attracting new businesses, more jobs and pay raises is out of the question.

One problem he noted was the persistent lack of reliable sewage systems in communities like Uniontown and Lowndes County.

“When we look at the wastewater situation in the Black Belt, it's not just about the individual home,” White said. “They cannot attract that economic base that will help their citizens with paying jobs so that they can afford housing.”

One solution is solving the infrastructure problem, as multiple groups are actively trying to do, including White’s wastewater consortium and the Black Belt Unincorporated Wastewater Program

Another suggestion that Eide suggested was to take advantage of pandemic-created remote work opportunities as a way for rural residents to bring in higher income.

“What it takes is connectivity of broadband access and schools, good quality schools, because if you have both of those here, you can attract people that could work from Newbern, as opposed to Birmingham, or Mobile, or somewhere like that,” he said. “It'll be really interesting to see the rural communities that take advantage of that and provide those things.”

4. The construction workforce is estimated to shrink 80% in the next decade. Rural areas will feel the most impact.

USDA Rural Development senior architect Meghan Walsh said the construction industry has started to feel a crunch that will continue through the next decade, affecting the entire country, but particularly rural areas like Alabama’s Black Belt.

Finding a large enough pool of subcontractors like electricians, plumbers and framers to bid on work in rural areas can be challenging enough for contracting companies. This would mean the construction needed to resolve rural Alabama’s housing problems will take longer and become more and more expensive.

“We're losing 80% of the construction industry workforce in the upcoming decade, and there's no place that will feel that more than rural America,” Walsh said. “All the buildings that you see here at Rural Studio, that's the kind of contractor that we mean. It's an invisibility that doesn't get enough attention.”

To weaken the brunt of the problem, Walsh had two suggestions. One, train more skilled workers who live in rural areas to enter the construction workforce, and two, loosen the purse strings on federal funds going to rural housing now.

“I think we have an issue of putting fire hoses where we need watering cans,” she said. “FEMA has done studies where they say that if they spend $1 today, they'll save $11 on post disaster relief. If we were to look at finding small tranches of money to pair with mortgages, I don't see that as charity, I see it as preventative and a way for us as a nation to save money.”

5. Substandard housing, risk of poor health outcomes and rural areas are all linked.

“If you fix one of those things, you help the other,” Rural Studio associate director Rusty Smith said. “Housing, in some ways, has become healthcare. We know the future of healthcare is in prevention, not in management, and housing is a key component of preventative health care for the country.”

The disproportionate impact of COVID in the Black Belt shows the direct link between housing and health. For each 5% increase in households with poor housing conditions, the risk of COVID infections increased by 50% and COVID-19 mortality increased by 42%, according to a Brown University study.

Six of the seven Alabama counties with the highest per capita death rates throughout the COVID pandemic are in the Black Belt. Lowndes County had the highest with a death rate of nearly 700 per 100,000 residents.

Moreover, substandard housing contributes to increased risk for chronic diseases, accidental injuries, cardiovascular disease, lead poisoning and respiratory infections.

One potential solution lies in increasing access to sustainable homes and providing assistance in repairs, not just rebuilding.

“There are a lot of affordable homes that are not good quality, people living in places that they really shouldn't be living,” Federal Reserve Bank President Bostic said. “It's the economics of doing maintenance that doesn't work in rural places.”

By expanding programs that provide rural residents with easy access to maintaining air quality, preventing mold and removing lead hazards — like the one currently run by the University of Alabama and the Alabama Department of Public Health — overall health outcomes could improve alongside housing conditions.

Hadley Hitson covers the rural South for the Montgomery Advertiser and Report for America. She can be reached at hhitson@gannett.com. To support her work, subscribe to the Advertiser or donate to Report for America.

This article originally appeared on Montgomery Advertiser: Barriers to affordable housing in rural Alabama and how to fix them