At Home With the Matadors: Durham’s Housing Crisis, SCAD, and Their Impacts on the Upcoming Election

Jerry McClain’s house is the one on Fayetteville Street with the skeletons hanging in effigy and a sign reading, “Black seniors hung out to dry and die.”

He’s been accumulating protest signs for years, since the city began negotiating to buy part of McClain’s property in 2013.

After construction on the intersection of Fayetteville  Street and Riddle Road started in 2019, the city realized it needed more of McClain’s land than expected. Negotiations failed. The skeletons came sometime after that. 

McClain’s case was on the agenda for the August 21 Durham City Council meeting, but it got little attention. The crowd that had packed the council chambers was there for a different debate about development, equity, and change: SCAD. 

Short for “Simplifying Codes for Affordable Development,” the proposed amendments to Durham’s unified development ordinance (UDO)—the collected zoning regulations that determine what can be built, and where, in the city—has become Durham’s most explosive political issue.

Shortly after the meeting began, and quickly devolved into accusatory mudslinging, SCAD’s applicant, the Raleigh-based developer Jim Anthony, requested a 90-day delay, pushing the vote until November. 

It was a tacit acknowledgment that SCAD had become too controversial for election season. 

SCAD first came before the council in March, but this latest delay spurred Mayor Elaine O’Neal to suggest “a different kind of task force” that could draw on nearby universities for objective analysis. “I think that’s part of the missing discourse,” she said. “There is not an objective voice.”

This week, the task force is supposed to present a plan on how to proceed.

Durham is quite literally being remade. You don’t have to believe in the housing theory of everything—the idea that rising property costs exacerbate issues ranging from income inequality to climate change—to see how the council’s development decisions are shaping the city’s future.

Even at their best, those debates are split into binaries—affordable housing activists versus developers, NIMBYs versus YIMBYs—that are inadequate for the task. But the confusion and vitriol of the August meeting show just how poorly equipped Durham is to navigate questions of its future in its current political state. 

Poor Black neighborhoods have allied with wealthier white homeowners against accelerating construction, while some of Durham’s progressives and business-friendly moderates have joined forces with local urbanist developers in the hopes of making the most of the city’s limited powers. All are caught in a stranglehold by the General Assembly.

The vast majority of voters are trying to make sense of it all. Tenants, especially, are just trying to pay their ever-increasing rent. 

Method in the madness

Nearly everyone in the debate agrees on two things: rising housing costs are creating a crisis in Durham, and the city’s zoning regulations should be overhauled. 

The statistics paint a stark picture of the problem’s scale.

Out of roughly 122,000 households in Durham, nearly 39,000 can’t afford their current living situation. The Durham Housing Authority (DHA), long starved of resources by the federal government, has a 3,500-person waitlist for one of the 1,700 units DHA controls and an 8,000-person waitlist for the housing vouchers tenants can use on the private market, according to DataWorks NC.

Nonprofit affordable housing developers are attempting to fill the gap, but they’re a drop in the bucket. Durham’s largest nonprofit homebuilder, Habitat for Humanity, built just 17 homes last year. Each costs $170,000, meaning that if Durham donated its entire 2024 city budget to Habitat, there would still be more than 35,000 housing-burdened people. 

Private developers provide the vast majority of affordable housing in the United States, so the only solution is to use the law to regulate more affordable housing. But North Carolina doesn’t give local governments the powers that other cities around the country use.

Rent control is illegal in privately owned apartments (with a few important exceptions), as is mandating that private developers provide affordable housing. Progressive taxes are an obvious source to boost revenues that could fund projects, but the state constitution prevents cities from instituting them. Local minimum wage laws are forbidden, too, so there’s no direct route to boosting flagging incomes. Tenants don’t have the right to withhold rent when their apartments aren’t up to code unless they obtain a court order. 

But cities can create zoning codes. By limiting what can be built where, codes shape the economics of development. Done right, they can weigh the scale and tilt projects in certain directions. 

By only allowing houses less than 1,200 square feet in specific areas, for instance, zoning regulations can prevent new McMansion developments. And by creatively writing regulations, the city can provide incentives that entice developers to build affordable housing—say by letting them build taller than they could otherwise if they voluntarily agree to set some percentage of the units aside for low-income residents.

But those strategies must be precisely calibrated to current economic conditions to work, and Durham’s UDO was written 20 years ago.

Technical tweaks and big dreams

Growing frustrated with the situation, several local developers, builders, architects, and other practitioners began the process that gave birth to SCAD. 

On a drive through Old West Durham in mid-August, developer Aaron Lubeck pointed to a former church for sale next to Locopops and Cocoa Cinnamon. A large, empty parking lot sits between it and Hillsborough Road. Because the current UDO requires buildings to have a certain amount of parking spots, the lot couldn’t be developed separately from the church, Lubeck explains.

“You’re on a corner that already has two of the four corners with great little businesses,” he says. “This would be a great parcel to build something, whether it’s housing or commercial space or whatever. But it’s locked.”

Because of such restrictions, Lubeck says the market for local affordable housing builders is nonexistent today.

“The only thing that’s getting built is 100 percent out-of-town money, 100 percent big projects that are political and require lawyers and compliance officers and the kinds of things nobody local could do,” he says.

Taking advantage of a Durham process that allows private citizens to propose amendments to the UDO for a $4,396 fee, SCAD’s authors put together a list of changes that would support the small-scale projects that larger national developers don’t bother with. They focused on the lots remaining around Durham’s urban core that are too small, weird, or complicated to have been built already. 

A proponent of the new urbanist movement that advocates for walkable cities with residential and commercial spaces intermixed, Lubeck was particularly interested in the way the UDO’s minutiae—buffers, setbacks, water runoff standards, and the like—create dead, car-centric space.

Buildings have to be too far apart with too much parking, Lubeck says. Driveway requirements mean they can’t position houses in the most rational way on some lots. Neighborhood corner stores aren’t feasible because of rules preventing commercial development in residential areas.

“There are all these opportunities to build relatively short urbanism, and that includes office space, housing, restaurants, and allows that kind of organic messiness that people love about Durham but we’ve truly legislated out of existence,” Lubeck says. “We have a lot of sprawl repair to do and a lot of infill on that front, and that would be transformative.”

“The only thing that’s getting built is 100 percent out-of-town money.”

SCAD even put a 20,000-square-foot maximum on some provisions—a limit Lubeck says was specifically chosen to prevent dollar stores from using them.

Those small projects are technically possible now, but they require developers to get approval for special permits and rezonings. Because those approvals require studies, site plans, drawings, and other services before they are voted on, and the lawyers, engineers, and other specialists often attend the various hearings, Lubeck says developers have substantial costs before a vote that could still end in rejection. He estimates an average cost of $50,000 for projects impacted by SCAD, but says $150,000 isn’t uncommon. The risk is too great for small developers, making it more likely that the city gets uglier, more expensive projects from large national and international investors.

While many of SCAD’s 130 proposed UDO changes are small tweaks, like determining how close small stoops can be to the street and which yard in strangely shaped lots counts as the rear yard, there are also significant shifts. 

It would eliminate regulations requiring a minimum amount of parking spots for any new development. Any planned developments with more than 100 housing units would also have to set aside space for civic or commercial purposes, pointing toward walkable developments. And SCAD would allow faith-based institutions to develop housing projects on their land—a provision Lubeck says would be the most impactful, given the vast amount of land they own. 

There goes the neighborhood

For many residents in the majority Black neighborhoods already experiencing rapid gentrification, Lubeck’s dream sounds more like a nightmare that will make housing more expensive, not less.

Their argument is simple: look around. “How’s that worked over the past 15 years?” asks city council member and mayoral candidate DeDreana Freeman.

SCAD’s most controversial provision has compounded the skepticism. Progressing Affordably Towards Housing (PATH) would alter the city’s affordable housing density bonuses—the carrots used to entice builders to guarantee cheaper housing.

The amendments would increase the percentage of units that have to be made affordable from 15 to 25 but reduce the length of time they have to remain affordable. From the current 30-year requirement, it would drop to just five for rentals. For-sale units would revert to market rate immediately after their original sale.

“That does so little to address Durham’s problem,” Bonita Green, president of the InterNeighborhood Council (INC) and a city council candidate, wrote in a March email to the council. “It is shocking given how advocates emphasize this benefit in presentations.” (Disclosure: Green and I both serve as DataWorks NC board members.)

Lubeck argues that even the reduced time frames are better than what we have now. But that has done little to convince skeptics.

“There’s no oversight, so they’re creating problems for others,” Green says. “It’s intentional as well by these developers, because they’re trying to push these people out because they want the land.”

Instead of relaxing standards—an approach INC has chastised as “trickle-down housing”—critics like Green want to see the city take a more aggressive approach to developers. That means restricting what can be built unless substantial affordable housing concessions are made, since zoning is the only real leverage the city has. 

“Real estate is about dealmaking,” says planning commissioner, city council candidate, and SCAD opponent Nate Baker. “The other side writes books called Art of the Deal, and they want our side to think we have to accept the first deal that comes to us on the table.”

The working-class Black community of Bragtown is a case in point. After the Bragtown Community Association effectively defeated a proposed 900-home development with only 20 affordable units, a new developer arrived and offered 325 affordable units instead.

Ultimately, Green’s goal is to ensure that marginalized communities benefit from whatever development happens, which is why she objects when the SCAD opposition is characterized as NIMBYs who simply don’t want new projects.

“That’s not true,” she says. “People don’t mind building. It’s the way that it’s done. You’re pushing out our voices. We don’t have a say-so in this, and we don’t like the way that you’re building.”

Jim Anthony’s role as the amendments’ figurehead hasn’t helped SCAD’s case. Notoriously right-wing, Anthony told INC that “gentrification is necessary to erase the ‘blight,’” according to an INC report on SCAD.

“I don’t think there’s anyone who has ever looked at our projects and would say, ‘That was a mistake’ or ‘That damaged anybody in this community,’” he said at the August council meeting, proving his ignorance of Durham public opinion.

Demanding supply

Given Anthony’s role, many Durham progressives are wondering why left-wing politicians are backing SCAD. Why choose Anthony over poor neighborhoods?

But SCAD’s supporters don’t disagree about the problem of gentrification. The pro-SCAD council bloc have all opposed PATH’s affordability periods. They back SCAD in general because they come to the opposite strategic conclusion when they see the impact of rich newcomers moving to Durham: more development, not less, is the only way to prevent the worst ills of that reality, they say.

Picture a typical, run-down Durham millhouse that could be sold today for $200,000 or $300,000. SCAD’s authors hope to make it possible to replace that one house with four new ones, which might go for $400,000 or $500,000 each. That’s a clear example of gentrification and an incentive for developers to displace more residents. 

But SCAD’s backers are more worried about the alternative. If we don’t build those four houses, the argument goes, the original millhouse will still be flipped or torn down, except an $800,000 or $900,000 house will replace it. And the three households who would have built the additional houses on that lot will do the same somewhere else in the neighborhood.

“They’re going to make their money either way,” council member Javiera Caballero, who is running for reelection, says. “They’re going to put those big blocky things you all hate—those oversized crazy houses that everyone complains about. They’re going to build that, or they’re going to build more creative stuff.”

“Obviously a $350,000 townhome is insane,” council member Jillian Johnson says. “But that’s where we are now. It’s not about choosing between a utopian village and this developer’s proposal. We’re choosing between North Raleigh and the developer’s proposal.”

Precisely because the people moving to Durham—part of the fourth-fastest-growing region in the country—tend to be wealthier, they’re able to bid up the price on whatever housing already exists.

“The African American community has taken to championing preserving some neighborhoods, not recognizing the spillover effect, as I call it,” says council member Mark-Anthony Middleton. “If a wealthy person has to move to our area, it’s not based on whether we build a house or not.”

That was the impact even with the bungalows in Southside, an affordable housing development in the historically Black neighborhood just outside of downtown. 

An NC State University researcher found that despite controls limiting the sale of housing to low-income residents, the project’s beneficiaries were more likely to be white and rich than the neighborhood’s existing residents. One couple’s parents paid off their cars before they filled out the program application to ensure they would qualify.

Accordingly, proponents of the supply-side strategy argue that the only viable option that can have an impact at scale is to build enough housing that vacancies increase and prices begin to fall. 

“Obviously a $350,000 townhome is insane. But that’s where we are now. It’s not about choosing between a utopian village and this developer’s proposal. We’re choosing between North Raleigh and the developer’s proposal.”

Some national data backs them up. New York writer Eric Levitz reports that places with the most new construction saw rents rise less than they did elsewhere. In places where the supply grew by more than 10 percent, rents even fell. 

Though pushing back against projects in the hopes of more concessions might lead to better outcomes in cases like Bragtown, Johnson says it can also make things worse. 

After tense arguments with both the Walltown Community Association and the normally affable former mayor Steve Schewel over the paucity of affordable housing in its plan to redevelop Northgate Mall, for example, new owner Northwood Ravin withdrew its proposal and replaced it with another, with no housing at all.

The city council still has a chance to weigh in when the project comes up for a rezoning request, but state law prevents it from explicitly requesting affordable housing as a condition for granting a zoning change. All they can do is say no and hope the developer comes back with a better offer.

What’s a house for?

There’s one policy question that cuts across SCAD support and turns the debate into a confusing ideological muddle: the role of homeownership.

Moderate, entrepreneurial-minded SCAD backers like mayoral candidate Leo Williams and fervently anti-SCAD neighborhood organizers like Bonita Green share the goal of creating homeownership opportunities—as do many of the home builders who wrote the amendments.

“Everything is moving toward rentals,” Green says. “That’s the only way these banks make their money. If you’re not paying your rent, they can kick you out and charge a higher rent. And that’s problematic because people aren’t able to build wealth.”

Increasing the required affordability periods in PATH is essential to shrinking the racial wealth gap, Green and her allies say, because spurring Black homeownership is the goal. But the flip side is that affordability covenants cap how much wealth those houses can earn: someone who buys a house with a 30-year affordable covenant and sells it 10 years later doesn’t get to sell it for market rate, meaning their wealth doesn’t grow at the same rate as the rest of the city’s homeowners’.

“Why can we not have the ability to build wealth like white people do?” Camryn Smith, executive director of East Durham’s Communities in Partnership, says of those kinds of programs. 

Arguing that there must be a “both/and” strategy to balance the number of affordable houses available while allowing their owners to profit from them, Smith unwittingly echoes the argument Williams makes in favor of SCAD.

“Who are we to get in the way of people building their wealth?” Williams asks. “You built your wealth this way. Why are you trying to block someone else?”

But homeownership has also been a driver of inequality. Though SCAD’s opponents compare the supply-side argument to Ronald Reagan’s trickle-down economics, it was white homeowners who launched the Reagan revolution in order to protect their property investment. With Durham’s median home value growing from roughly $186,000 in 2015 to $396,000 today, according to data from Zillow, Durham homeowners might have as much of a financial stake in the status quo as developers do in increasing construction. 

Opposition to development in places like Bragtown may be understandable as a justified fear of gentrification, but there are plenty of SCAD critics whose interest lies in wealthy white neighborhoods. 

Discussing the same Hillsborough Road intersection Lubeck saw as ripe for beautiful urban messiness, Tom Miller only saw an imposition on homeowners.

“When I was a little boy, this was a dirt street and those were houses,” the former planning commissioner and lawyer says. Pointing to the single-family homes that back up to the now commercial street, Miller laments how close SCAD would bring buildings to the existing houses. 

“We create houses that are not desirable as residences, and we cause neighborhood decay,” he says.

“Dense living, if it’s too dense, in my opinion, works against the welfare of the body politic,” he adds.

There’s one group in particular that follows along with dense cities, whose existence is too volatile for Miller’s comfort: tenants.

“I was on the Planning Commission for seven and a half years. I don’t think I ever remember a tenants group coming in,” he says. “I don’t want more people in that unstable situation.”

SCAD opponent DeDreana Freeman tried another tactic to give tenants stability in 2021 when she proposed a tenants’ bill of rights in conjunction with the now defunct Bull City Tenants Union. But the project stalled out.

The city attorney’s office ruled out most of the union’s more ambitious demands, and the rest, Freeman says, would likely just lead landlords to raise their rents. 

“The tenants’ bill of rights could be shifted into just a landlord agreement,” Freeman says. “They could voluntarily sign on to be a good landlord of the City of Durham with a stamp. But that would be as far as it would go until our General Assembly acknowledges that our tenants should have rights.”

But tenants bear the brunt of the housing crisis. They make up nearly half of Durham households, and 46.9 percent of them are housing-burdened, compared to just 17.5 percent of owners. 

The progressives backing SCAD, like Johnson and Caballero, conclude that the best option available is using development powers to shift market conditions in a way that makes renting more affordable, even if it angers homeowners. After all, the evidence for the supply-side approach’s success is lower rents, not home prices.

That stance separates progressives from SCAD allies like Williams as much as it does SCAD’s opponents.

But there’s another kind of SCAD critic.

Baker, likely the first person to be endorsed by both the moderate Durham Committee on the Affairs of Black People and the Democratic Socialists of America, similarly argues for a vision of housing that isn’t based on the accumulation of wealth, though he says we must also close the racial wealth gap. (Disclosure: I am a member of DSA but played no role in the decision to endorse Baker.)

“I tend to view affordable housing, especially in an exploitative capitalist system, as a utility,” he says. “It’s a need we will always have—a utility like water pipes or sewer pipes.”

That thinking is why his main complaint about SCAD is not that it builds too much but that it builds too little.

Baker’s goals sound similar to Lubeck’s in writing SCAD, and Baker admits he has sympathy for small developers trying to build interesting projects. The goal, he says, is to make it easy to build good things and hard to build bad things.

But Baker argues that the way SCAD allows neighborhoods to mix homes and commercial developments makes it possible to build single-family homes in new parts of the city, which other developers would abuse to increase sprawl.

Trust the process

Hashing out the strange combination of decades-long visions and small technical details isn’t easy, but the public debate over SCAD is clearly broken.

While critics argue that a developer-controlled process is inherently unequal and the authors never seriously considered their input, proponents point to the extensive public engagement process SCAD has undergone. 

“I tend to view affordable housing, especially in an exploitative capitalist system, as a utility. It’s a need we will always have—a utility like water pipes or sewer pipes.”

The initial public comment period lasted from April to December, says Lubeck, and included around 70 public meetings with dozens of civic groups and hundreds of participants. There was also input from city staff and public hearings with the Joint City-County Planning Committee, the Planning Commission, and now two with city council. 

“It almost feels as though we’re trying to deny by delaying,” Williams said at the August meeting. “I have no issue with the substance of this document, because that’s what I was looking forward to discussing tonight—the substance. But we have yet to get to that, because the process has been obstructed.”

The claim is familiar from developers and their allies, who often complain about long public review times where small groups of homeowners can continually delay projects. But the activists say it’s the only way for ordinary people to influence the city’s major development decisions.

“All of the agencies in the city have this thing like, ‘We don’t need to talk to the community. You don’t need to be involved. We make the decisions,’” Green says. 

For Baker, there’s a way to solve both issues at once: rather than wait for developers to propose a project to consider a rezoning, create small area plans for key areas of the city. 

By proactively getting community input, building neighborhood-specific plans, and preemptively rezoning the land to encourage the kind of development the city wants in threatened areas, city council could gain additional leverage for affordable housing while solving the genuine impediments local developers face.

Baker uses a project in Old North Durham as an example. A developer plans to demolish 25 market-rate but affordable rental units and replace them with 33 for-sale units, five of which will be guaranteed to be affordable for 30 years. But that still means 20 households will lose affordable rents.

“We have the power, through our zoning regulations, to prevent that kind of thing,” Baker says. But only by proactively rezoning parcels to account for their specific context. 

The risk, Caballero says, is that giving neighborhoods too much power will allow wealthy, white areas of the city to dominate proceedings at the expense of everyone else.

“There’s a difference between input and control,” she says. “And quite frankly, neighborhood control has a lot of loaded meaning in the South of all places.”

Small area planning is also labor intensive. It couldn’t be done for the whole city, at least not anytime soon. Planning for the rest of Durham means writing an entirely new UDO. Conveniently that process is just about to begin, unless the ongoing SCAD debate interferes with it.

The council should officially adopt Durham’s new comprehensive plan this year, then create a new UDO to implement it. But given the confusion and furor over SCAD, there’s reason for pessimism about the city’s ability to manage the process.

“You’ve got to trust the entity that is shepherding through major changes,” Baker says. 

It was clear from the August council meeting and public accusations of corruption that such trust simply doesn’t exist currently. With SCAD now due for a vote in the middle of the council’s lame duck period, after the election but before the new mayor and council members take office, it’s anyone’s guess whether things get better or worse. What happens to all the fragile coalitions when the electoral energy is gone?

Maybe Jerry McClain’s odyssey provides a clue.

After the SCAD hearing abruptly ended, the council had to vote on whether or not to use its eminent domain powers on his property. It was a 6-1 vote in favor, with Freeman dissenting. 

Time will tell if McClain hangs another sign.

This is the third story in a four-part series covering Durham’s upcoming municipal election.

Comment on this story at backtalk@indyweek.com.