Increasing workforce housing availability
With
As decision-making moves down the governmental pyramid, state and especially local policy makers may inadvertently overlook promising ideas, or fail to use them in best concert with one another.
I just know I had some good policy ideas in here
Filling this void, the Center for Housing Policy has followed up on its insightful study (about which I’ve already posted) of the relationship between housing and transportation costs, A Heavy Load: The Combined Housing and Transportation Burdens of Working Families (link in .pdf) by putting out a cogent 36-page handbook on state and local initiatives that can increase workforce housing under the title, Increasing the Availability of Affordable Homes (link in .pdf).
Author Jeff Lubell has done a terrific job [You just like that he interviewed you! — Ed; That shows his discernment — Auth.] —
Jeff Lubell, Executive Director at the Center for Housing Policy, up against the wall but still smiling.
— of capturing ideas and then distilling them down to easily accessible principles.
Nothing but the best and purest principles here!
The handbook identifies 22 state/ local initiatives (part of the larger local menu of affordability initiatives) that it groups typologically into six broad strategies:
1. Expand site availability, through use of publicly owned land for housing, abandoned or vacant properties, and rezoning (from commercial or industrial to high-density housing).
Big money if approved
I’ve said elsewhere that a locality’s posture toward affordable housing is determined by two things: zoning (which allows ‘those people’ in or keeps them out) and real estate taxation (which rewards or penalizes different uses). Deploying land owned by the public, whether acquired through community purchase or after tax lien foreclosure, is simply zoning writ extra large.
Put your John Hancock on the zoning application
Property use begins — and often ends — with land use.
2. Reduce regulatory barriers and costs with diverse housing zoning (the polite way of combating NIMBYism’s favorite dodge, snob zoning), expedited permitting and review, reduced ‘impact fees’ (yes, many communities with a housing shortage charge developers a premium for building new homes, a form of economic NIMBYism), and reducing building-code barriers to rehab.
School rehabbed into affordable apartments
I remain astonished that localities simultaneously erect every conceivable obstacle to new development and then bewail how hard it is to get service workers, failing to appreciate the pretzel hold they get into.
3. Monetize rising property values through tax increment financing, well designed real estate tax abatements, housing trust funds (and community land trusts), inclusionary zoning and density bonuses, and cross-subsidies.
Personally, I’ve always doubted the efficacy of cross-subsidies.
Whose subsidies are you saying are cross?
In my experience, they always signal flawed underwriting being patched up by an unsubstantiated rosy projection — usually of commercial income.
Far out underwriting, man!
Nevertheless, the key principle here is that a strong economy translates into higher property values, which translates into higher local government revenues, a portion of which can be easily redirected into affordable housing.
4. Accumulate and lever resources. Affordable housing always costs money, and if a little housing funding is good, more is better, so we have ideas such as making more use of volume-cap bonds for affordable housing (to capture the ‘free’ 4% Low Income Housing Tax Credits), favorable-rate predevelopment and pre-acquisition financing, housing bond issues, tapping of Housing Finance Agency reserves, and employer-assisted housing.
These last two are much more provocative than it might appear, and in future posts I intend to say a great deal about each, especially the tapping of HFA reserves and accumulated equity
Hey, it’s better kept in our vaults than put into housing … isn’t it?
5. Preserve and recycle resources, starting with preservation of affordable rental housing, recapture of down payment assistance through soft debt and similar mechanisms, and greater use of shared equity (a UK innovation I’d like to see the US employ more than we do).
Money should be a catalyst, not permanent eco-fertilizer
All too often, government bodies eager to create new affordable housing shovel the money out with inadequate thought to when and how it might be recouped and redeployed. That’s one reason I’m such a fan of soft debt (rather than grant) and soft equity; you can get some of that public investment back, and it benefits from favorable automaticity — as one property becomes less affordable, government gets money to create another one.
6. Empower residents via homeownership education and foreclosure-prevention assistance.
Often overlooked but essential, both in helping applicants find and buy the right house at the right price,
Conclusion. The handbook is an educational rather than instructional manual. It’s nowhere comprehensive enough to enable a locality to make a commitment to pursue a particular initiative, but is certainly enough to decide whether a locality wants to explore one or more.
This looks like a promising avenue …
For implementation, practitioners will want to download Lubell’s 115-page full study (link in .pdf), and even that, extensive as it is, is only the beginning.
It’s a very nice piece of work with broad applicability and excellent accessibility. It belongs on your reference bookshelf.
File under H for Housing or I for Insight?
