CEE 45Q Affordable Housing - A Social Entrepreneurship Startup

Spring 2002

Project

"Some men see things as they are and say, 'Why?'
I dream of things that never were and say, 'Why not?'"
Robert F. Kennedy

Background

The cost of housing in the San Francisco Bay Area has grown dramatically in recent years, making it one of the most expensive regions in the country in which to live, and creating a crisis for low- and moderate-income households. The incomes of teachers, police, nurses, gardeners, and other civic and service workers are simply not keeping pace with rising housing costs, stressing family budgets and leading to moves that result in long commutes and overcrowded housing conditions. This region has great disparities, with vast wealth and multi-million dollar mansions not far from dilapidated homes where complete families live in each room, struggling to get by. And in a state where no race has a majority, this region is especially diverse, ethnically and culturally, fueled by a steady stream of immigrants.

A number of organizations are working to help low-income households caught in this affordable housing crisis. Non-profit developers use scarce subsidies to build affordable housing. Organizations help new immigrants and refugees find jobs and places to live. Transitional housing providers help those who have become homeless get back into housing. But all these organizations combined are able to help only a small fraction of those in need. The typical non-profit does the best it can with its resources stretched very thin; it does not have an R&D department to pursue innovations, especially technical innovations, that could help it be more effective.

Seeking an Innovation that Would Make a Difference

The CEE 45Q team can do little to affect the forces that underlie the affordable housing crisis in this region. Instead, it will focus on what it can do by seeking a feasible innovation to help those caught in this crisis. It will first conduct research and field work to gain an understanding of the plight of the households in need of affordable housing and learn about the organizations that currently work to help them. As entrepreneurs, the team will be constantly seeking out and evaluating opportunities where an innovation could have a positive impact. It will assess the feasibility and potential value of various proposed solutions and will select one solution to pursue in depth. With the guidance of an advisory board of professionals, it will then develop a business plan for bringing this solution into reality.

The key milestones of the project are listed below and on the course outline.