The Transformation Conundrum


Has gentrification found its way to Knoxville?

What usually goes up must instead stay the same. That’s as good a way as any to describe how some in Knoxville and around the country want to deal with “gentrification,” a subject that locally has been increasingly talked about as the value of living in Knoxville–and its costs–have grown.

The term is used to describe the transformation a lower-income neighborhood undergoes as more affluent buyers move in. The fears of some here are that gentrification will make once-poorer neighborhoods more costly, moving out lower-income people. However, for some home and property owners, lenders, landlords, and government, gentrification is another way to say their investments are appreciating. Accompanying increased property values are increased taxes on a more affluent tax base, about which government rarely complains.

The gentrification argument is therefore circular: government is spending taxpayers’ money to help improve a neighborhood’s desirability and value, and then spends taxpayers’ money in an effort to overcome the market to keep the increased value from affecting the people living within those neighborhoods.

Gentrification came up in the debate over the ultimately-approved downtown Knoxville baseball stadium. Dasha Lundy, 1st District county commissioner, voted for the stadium despite concerns that included gentrification, as she told WATE-TV news: “It’s so difficult because of history. Having a majority minority community, we’re dealing with gentrification and all that stuff. I struggled with this for a long time, but I choose right now to be optimistic.”

Gentrification is said by its opponents to have a range of societal impacts: financial, social, historical, even health. Throughout the country an increasing number of cities that essentially lean politically left have been devising often-intricate and expensive plans to stymie gentrification with mixed success. It appears they reason that market forces can be overcome if government gets active on the subject and comes up with creative solutions—usually involving taxpayer money—to blunt the effects of property that is becoming ever-more desirable in the marketplace.

“First of all, gentrification refers to economic pressures and policies that dislocate residents, and that is not happening in Knoxville…we do not believe this is happening.”Eric Vreeland, City of Knoxville Deputy Communications Director

In Los Angeles, California, Metro, which runs the city’s transportation system, says it will buy land adjacent to new rail lines to keep it from falling into the hands of developers and to promote “affordable housing.” The New York City Council has voted to make “racial impact studies” part of the city’s land-use process. In Memphis, Tennessee, an organization in 2021 filed a $20 billion lawsuit against the city to try to show it has, among other issues, fostered gentrification over the years. Five states have some form of rent control laws; however, as a Brookings Institution article notes, rent control inevitably “decreases affordability, fuels gentrification, and creates negative spillovers on the surrounding neighborhood.”

The problems of gentrification often seem to be discussed around racial lines, obliquely, if not directly, and for a long time. It’s not as if this is a new issue. More than a quarter-century ago it was the subject of a master’s degree theses by then-University of Tennessee student Colin M. Riley. Titled, “Reinvestment in Inner-City Historic Space: An Analysis of Gentrification in Knoxville, Tennessee.”

Gentrification is in some respects opposite what were once controversial practices of housing and property dynamics of bygone years. “Redlining” by lenders—denying services to someone based on the location or the characteristics of the residents—funneled lower-income people into lower-income neighborhoods. But today, the fear of “there goes the neighborhood” based on a perceived threat to sink prices and property values has been upended: low and moderate-income neighborhoods that see an influx of upper-income residents, with corresponding higher home prices and property values is a reversal of there goes the neighborhood.

Wherever gentrification is discussed, the conversation invariably gravitates to how much (taxpayer) money government will pay to brush aside the market. People in decision-making positions can get the idea that if they don’t like how markets work, they can pass laws or regulations that overcome market forces.

During her successful 2019 run for mayor, Kincannon was asked about gentrification: “My approach to avoiding gentrification, I call it responsible revitalization. I support revitalization in parts of town that haven’t had investment in a long time or haven’t had enough investment. But we can do so in a responsible way that avoids displacement and gentrification.”

The mayor’s office wouldn’t directly address a question about whether Kincannon is opposed to gentrification; instead, it says gentrification isn’t occurring here: “First of all, gentrification refers to economic pressures and policies that dislocate residents, and that is not happening in Knoxville…we do not believe that is happening,” says Eric Vreeland, the city’s deputy communications director. “Thoughtful redevelopment is the opposite of displacement.”

Last year, the city council approved a mayoral plan to create the Knoxville Affordable Housing Trust Fund, a 10-year, $50 million spending plan on which, Vreeland says, “two years in, we’re ahead on that schedule.” Some $12.5 million is being spent on First Creek, “to replace infrastructure and build roads, sidewalks, lighting and green space.” According to the Knoxville Community Development Corporation (KCDC), the project also included the demolition of the 189 units built in the ‘40s. Residents in those units were relocated to other KCDC properties, but were being given first priority when the new apartments.

This year, the mayor’s budget also included $4.2 million into the transformation of the Western Heights housing community, which according to the KCDC addresses “the renovation and replacement of residential structures” and other aspects of the neighborhood. Other city programs such as down payment and owner-occupied rehabilitation assistance are supposed to help low-income people buy and improve homes.

So is gentrification occurring in Knoxville? Well, maybe. Says Vreeland, “We recognize there are market forces beyond the City’s control—such as sellers’ asking prices for their homes, or higher taxes affected by the reappraised value of a home increasing at a higher rate than the county average, or rising interest rates.”

Inevitably, the market will do what the market will do, regardless of government’s wishes, desires, or actions. And longtime residents of old-time neighborhoods, watching affluent newbies arrive, can say to themselves, “There goes the neighborhood.” Because whatever goes up will never stay the same.  

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