A few months ago, I lit into the Capital Area Development Authority, or CADA, for redlining a significant portion of Midtown Sacramento to exclude poor and middling tenants. What I find particularly objectionable about this redlining is that it is done as a matter of deliberate government policy, since CADA is a joint powers authority chartered by the Sacramento municipal and California state governments, and that there seems not to have been any pushback from local activists or the courts.

CADA administers a huge amount of residential property to the east and south of the Capitol, enough to unilaterally set housing policy on a number of blocks. Some of the conditions that it sets for tenants are draconian, among them, open lines of credit with on-time payment histories, high credit scores, stable, long-term tenancies with landlords who are not friends are relatives, and absolutely no negative references from past landlords. These conditions are objectively discriminatory against poor applicants, who are often forced to rely on makeshift living arrangements with friends or relatives, unable to pay bills on time because they simply lack the money, and preyed upon and retaliated against by systematically criminal slumlords. The question is not whether discrimination against the poor is taking place here, but whether or not it is morally and legally acceptable.

There’s another question that really muddies the waters: is discrimination against the poor practical? Having spent quite a bit of time in Midtown and Downtown over the past few months, I have no doubt that CADA has done a lot to clean Midtown up. Midtown doesn’t have anything like the hordes of shambling homeless mentally ill, patina of grime, and trails of trash that one finds on the K Street light rail mall, or, as it’s lovingly called by its marketeers in the (posh) drinking industry, “The Kay.” The 16th Street light rail station has a bit of that dysfunction going on, but it’s safe to assume that CADA’s redevelopment activities, some of them only a block to the north, have brought some degree of improvement to the station by increasing the sheer number of non-derelict passengers using the station at off-peak hours. If this is the case, it has to have marginally improved the quality of life for the disproportionately poor passengers who change trains there. (16th Street is the last station leaving downtown before the Gold and Blue Lines split, the former east towards the dodgy neighborhoods of Rancho Cordova, the latter south towards the much scarier ghetto sector of inland South Sacramento.)

CADA’s territory in Midtown is more or less free of the malt liquor bottle shops, intractable pants-on-the-ground al fresco alcoholics, undermedicated long-term outpatients, and criminal underclass elements that plague many parts of Sacramento and its suburbs. These things have been driven out by clean and orderly businesses and the sort of clean and orderly people who patronize them, who are also the sort of people one is not scared to encounter on the streets late at night. I’ve come to the conclusion that, questions of equity aside, CADA is clearly doing something right.

This still leaves troubling questions of civics. I would have much weaker objections to a private developer applying such conditions to prospective tenants at a luxury apartment complex that was built entirely on the free market, i.e., completely without eminent domain, weaselly tax-break inducements, or other government favors. (These conditions are met disgustingly less often than developers would like us to believe). At a high enough level, any residual objections I might have to the abuse of credit rating inquiries or other background investigations would be moot anyway, since serious high-rollers in real estate consider cash on the barrel head the offering that covers a multitude of sins, a most fitting sacrifice of first fruits.

The problem is that draconian tenancy conditions are applied most heavily against those who can least manage to meet them. Many rental markets are monopolies or oligopolies controlled by slumlord thieves who steal tenants’ security deposits as a matter of course. In these markets, the idea of tenants of limited means being able to exercise a right of free association to find better landlords or some sort of roommate arrangement sounds like a cruel joke. On the whole, American housing law is de jure equitable but de facto a dual system of high and low justice.

The proper role of government intervention in such a market is to enforce equity standards on landlords, many of whom are easily shown to be in willful and material violation of federal racketeering law. As a matter of equity at law, government agencies have absolutely no business helping unethical and often criminal landlords and banks entrench themselves as private tyrants by allowing them to help redline the poor out of apartment complexes that are tantamount to public housing.

One of the great intellectual frauds of agencies like CADA is their false promotion as civic and community organizations. CADA is more accurately described as a regulatory capture apparatus operating at the behest of neighborhood business interests. A huge amount of what passes for community civics in the United States is in fact business marketing strategy enforced through government policy. This is classic regulatory capture. What business owners want in these cases is to flood the neighborhood with their target demographic. Sure enough, CADA’s rental conditions are perfectly designed to flood Midtown Sacramento with yuppies and their disposable incomes.

This is a point that cannot be made clearly enough: the purpose of CADA’s draconian rental conditions is NOT to ensure that its tenants are orderly, peaceable, acceptable risks to their landlord, and capable of improving community life through their presence; it is to ensure that they’re moneyed enough to patronize the local yuppie joints at a suitable price point. These conditions are patently not designed just to screen out risky applicants who have trashed previous rental units, worked crack territories on Hella South Stockton, held meth bake sales in Rancho Cordova, or had regular 3 am bruiser sessions with their live-in lovers and the Sheriff’s Department’s night watch. They are also designed to screen out perfectly peaceable and civic-minded applicants who brew their own Sanka at home and eat pork and beans out of a can instead of dropping thirty dollars a day on lattes and Thai food. Some of these people are exactly the types whose eyes are good to have on the street. Do we want maternal 7-Eleven clerks and home health aides from the trailer parks and the ghettos moving into the neighborhood to keep their eyes on the streets? As a matter of civics, we do. As a matter of economics, it probably depends on whether they’ll buy their pork and beans at the Midtown Safeway or trek out to the Rancho Cordova Grocery Outlet, but the answer is: No, they’re poors.

And no, this is not being done so that these mother hens will continue to grace their old neighborhoods with their wisdom and supervision. Any self-described progressive who says otherwise is concern-trolling the Sacramento banlieue with suggestions that the crabs all work to keep each other safely within the barrel. If anyone in charge of policy at CADA gives a shit about Rancho Cordova, I’m Mother Teresa.

It isn’t about high civics; it’s about marketing through government policy, a much crasser proposition. Many elements in the business community do their level best to elide the difference between civics and business, but it’s a real and serious one. CADA’s class-based redlining is effective policy, but it is not equitable or ethically sound policy. Don’t think for a split second that they’re the same thing.