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Posts about Affordable Housing

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DC makes some of its affordable housing serve less wealthy residents (but not the poorest)

DC requires new apartment and condo buildings to include a number of affordable housing units, in a program called Inclusionary Zoning. Wednesday night, DC's Zoning Commission voted to make Inclusionary Zoning serve the group of residents who most need the housing this program can provide.


Photo by Ryan McKnight on Flickr.

What is inclusionary zoning?

Inclusionary Zoning (IZ) is a market-based tool for creating affordable housing that serves people of moderate incomes. Private developers still build housing as they wish, but have to rent or sell a small percentage of units to people making less money. It's had some success, but debate about the program continues.

IZ proposes to diversify our region's housing stock. In a high-demand area like ours, the market will naturally provide more expensive housing for higher-income people rather than cheaper housing. This is not a simple case of developer greed. The owner of a piece of property in a desirable, expensive area will want to sell it to whoever will give them the most money. If one group offers the land owner more money for the land (because they plan to build and sell luxury units), that group probably wins the sale over other groups looking to build moderately priced housing, or who want to use tax credits to build below-market housing.

Right now, in DC, many people who use tax credits to build lower-income housing can't win the bidding for enough land to build on. Where land is cheap, there is enough to go around for people to build units with diverse cost and meet diverse demand, though even then, without tax credits they can't sell units for less than it costs to construct them. But where land is scarce and demand is high, the market, on its own, won't provide housing for even moderate-income people.


Photo by Sharron on Flickr.

IZ tackles affordability and supply

When I walk around town talking about our region's housing shortage, many stop me and say, "What do you mean?! What about all of those luxury apartments and condos going up EVERYWHERE?" Land values explain a piece of that. Yes, we are building more housing than most other periods of DC's history, but there is a lot of pent up demand for housing at different cost levels that currently isn't being met.

Say I want to build a 5-story building with 50 units in it. To buy the land, get financing, and cover construction costs, I have to plan to rent the units at luxury prices. IZ changes two things. First, it forces me to build a number of units for people at lower incomes. That increases costs and could make my building unprofitable to construct, so IZ sweetens the deal: I can build my building higher and denser than normally allowed (about 20% larger, though it varies by zone).

When it's all said and done, my new plan after IZ is a 6-story building, and 5 of those 60 units are going to be rented at more affordable levels.

It's a compromise, yes. But is also unique in that it addresses the issue of housing supply (we just added 10 more units to the region!), as well as housing affordability (we just built 5 otherwise non-existent affordable options).

Other reasons IZ is exciting

The fact that IZ tackles our housing shortage from both a supply and affordability standpoint is one reason why advocates are for this policy tool, but there are other good things about it.

For one, if we are serious about building an inclusive city and region, this tool helps to do just that. People of different incomes can live (and afford to live!) in the same buildings and neighborhoods when IZ is applied well.

Recent studies by Raj Chetty and Eric Chyn show that low-income children who grow up in mixed-income neighborhoods make more money throughout life—16%, in Chyn's study—than those in entirely low-income areas. Keeping poverty concentrated is a recipe for more poverty, while mixed-income living (which IZ pushes) could show a way out.

Another reason to like IZ is that it leverages the resources, knowledge and power of the private sector. There is an immense amount of money and expertise in the development field, and they are very interested in building more housing. IZ attempts to align for-profit development interests (build more) with broader community interests (build affordable), and advocates hope to harness the productive energy and capacity of the development field to meet the needs of a diverse and growing city.


Photo by Tim Evanson on Flickr.

Spoiler alert: Not everyone is a fan of IZ

IZ offers both extra density (more money for property owners) and an expensive housing requirement (forced affordability constraints). Depending on the details of the program and the particular neighborhood or market conditions, the bonus could pay for the added expense, or not.

Further, IZ creates bureaucratic hurdles for the developer to go through. The process, paperwork, and the many legal and other experts required can add costs.

The early years of DC's IZ program saw problems with how the government was implementing it, including federal rules which made it impossible for buyers of IZ condo units to obtain mortgages. (DC changed the rules to deal with that obstacle.)

It's not just the developers

Developers are not alone in their criticisms of IZ. Some other affordable housing and low-income advocates are concerned about the program.

For some, it is simply a question of scale. Even in the hypothetical situation above, you can see this argument play out: we get 55 units of luxury housing, and 5 units of more affordable housing? For some that is simply not good enough, especially if there is a tool that would allow the original 50 units to be all affordable, or some significant percentage affordable.

Over that last few years since its inception in DC, IZ has created over 900 below-market price housing units, which is great. It's also true that in that same amount of time 21,000 total units have been created, and as noted earlier in my street conversations, many, many of those units are at luxury prices.


Map of IZ Production under old rules

Another concern some have about IZ is that it does not create "affordable enough" units. IZ laws mandate that a unit be affordable for people making a certain amount of money based on the Area Median Income (AMI). DC's current rules require some units at 80% of AMI and some at 50% of AMI, but the vast majority were 80%.

For a typical one-bedroom unit, an 80% AMI unit would rent for around $1,600 a month, while 60% would be around $1,100 a month. For many groups working alongside the poorest of our community (for example those making 30% or less of AMI), this does not serve the people in greatest need.

It's unlikely that IZ can create units at 30% of AMI, since those are so expensive to create and maintain compared to 50-80%. So IZ advocates mounted a campaign to create more deeply affordable units than before.

What has changed

This new change now requires all new rental units to be 60% of AMI (while condo units would be 80%). Currently, most new rental units being built were at 80%, but three-fourths of people on waiting lists for IZ units were around 60%.

Members of the Zoning Commission recognized that this was not serving the needs of many lower-income residents. During one hearing, Commissioner Michael Turnbull remarked, "[80% median family income] is basically market rate. People are saying, we can't afford that. The city is being gentrified. The people who grew up in the city are being kicked out." Commissioner Peter May agreed: "The house is on fire, and we are using a garden hose."

Yet there was opposition from the Bowser administration and the DC Building Industry Association to the proposal to lower the income targeting percentage to 60%. They put forth an alternative proposal. Under current rules, not all zones in DC have to incorporate IZ; the alternate option would add IZ to four zones (two of which, C2A and C2B, have some significant development potential, and two, SP1 and W2, that have very little) while keeping other zones as they have been.

Late Wednesday night, the Zoning Commission voted in favor of the 60% requirement. There will then be a 30-day period of public review before a second, final vote. For many of the thousands of residents who apply for the lottery to get access to these units each year, this drop will add greatly to their affordable options.

Government


In its attempts to provide affordable housing, DC has struggled to set clear goals

In 2006 and 2012, DC set clear numbers for how many affordable housing units either needed to be built or needed to be preserved by a specific date. In both cases, there wasn't enough data to actually track progress, and the goals fell by the wayside. Today, there still isn't a plan for providing affordable housing for everyone who needs it.

Advocates and District officials often find themselves jumping from crisis to crisis. At Museum Square, for instance, residents are scrambling to prevent landlord Bush Companies from evicting half of Chinatown's remaining ethnically Chinese population, after tenants (and many District officials) were notified of Bush's plans via demolition notices.

As the DC Fiscal Policy Institute wrote in a 2015 paper, "While there have been some very important successes, the lack of a coordinated, proactive policy for [affordable housing] preservation has led to many missed opportunities, resulting in the loss of whole communities to sale [and] large rent increases."

Meanwhile, too many DC residents don't understand how big the problem of affordable housing is. They hear about crises like Museum Square, but are left to cobble the bigger picture together through disparate facts like "there are over 70,000 families on DC's affordable housing waitlist," or "there are effectively zero market rate units left in DC that are affordable for low-income workers."

Here is an overview of the District's past targets, and some ideas for new ones.

There have been attempts to set clear goals and stick to them

Two-dozen representatives from District agencies, local housing nonprofits, and research organizations helped author a 2006 report that then-mayor Anthony Williams commissioned. At the time, developers were starting to pour money into new projects west of the Anacostia River; DC's housing problem in Wards 1-4 was less that development dollars were scarce, and increasingly that the new projects were raising rents, making it hard for low-income families to stay.

District leaders and the authors of the 2006 report were beginning to realize this, and they set these goals:

  • Produce 55,000 new units by 2020.
  • 19,000 of those units should be affordable (7,600 below 30% of AMI; 5,700 between 30-60% of AMI, and another 5,700 between 60-80% of AMI).
  • In addition, preserve 30,000 currently affordable units.
  • Adopt a local rent supplement program and reach 14,600 households.

Of course, goals don't matter if nobody takes them seriously.

In 2007, Mayor Fenty appointed Leslie Steen as "housing czar" to implement the 2006 plan. She was supposed to cut through red tape and coordinate the many District authorities that touch on affordable housing, including DCHD, DCHFA, DCRA, DMPED, and DCHA. But she ended up being marginalized within the administration, and ultimately resigned in frustration.

In 2007 and 2011, Alice Rivlin wrote two follow-up reports; she praised the District's progress on some fronts, and basically threw up her hands on others; in 2011, nobody had the data to track progress towards the 2006 targets.

Another report was released in 2012 under the auspices of the Grey administration, and laid out these goals:

  • Preserve 8,000 existing affordable units.
  • Produce and preserve 10,000 net new affordable units by 2020 (I couldn't find a detailed AMI breakdown for these 10,000 units).
  • Support development of 3,000 market rate units by 2020.

Grey made a public commitment to reach the "10 by 20" goal, but since 2012 talk of these goals has faded. The Coalition for Nonprofit Housing and Economic Development has worked hard to get the District to commit to an investment goal: $100 million a year in the Housing Production Trust Fund. But Mayor Bowser has yet to adopt specific goals for the number of affordable units she wants to preserve and produce.


Mayor Bowser announcing affordable housing initiatives in January of last year. Photo by Ted Eytan on Flickr.

Setting numerical goals might be worth another look

If we establish another set of city-wide goals, they must be clear, and we must be able to track progress towards them. Such goals could accomplish at least two things:

  • Helping focus our collective efforts. Once we've agreed on a set of targets, we can get creative with solutions. Maybe it's up-zoning some parts of Ward 3; maybe it's strengthened Inclusionary Zoning, maybe it's more preservation and accessory dwelling units. (If we set respectable goals, it'll probably require some combination of all of the above).
  • Having a clear, public goals can help District residents hold their government to account. We could ask, "Why are we missing our targets?" We cannot ask that question now.

Here's an example of a measurable goal, just as food for thought: "The District should have no net loss of affordable units, relative to our current stock and distribution of affordability."

So if we have 40,000 units affordable to people who make below 40% of Area Median Income, we should still have that many in 2030. That's a clear goal, which the public could use to hold their representatives accountable.

An equally clear, less conservative goal might be, "The District should ensure that 30% of its total rental units are affordable to people making below 40% of AMI."

Today we're closer to having the data to track progress towards city-wide goals. The Urban Institute, in conjunction with the DC Preservation Network, has compiled currently available records (you can find a report from December here). The city's trying to improve its own data collection.

Clear goals and stringent data collection have helped the District come close to ending veteran homelessness. As Kristy Greenwalt, head of DC's Interagency Council on Homelessness, told the City Paper, "In the past, there was no systematic approach. We're in a very different place now, so we can actually track what's happening and why."

Goal setting alone can't build or preserve housing, and planning isn't execution. But without precise goals, it's hard to know if we're falling down or making progress—ensuring that new people can move to DC, existing residents can stay, and low-income people can live close to good jobs, schools, and public amenities. A comprehensive, strategic solution to our housing crisis begins with knowing what it would mean to win.

Links


National Links: From Florida to California

Miami is moving forward with big transit plans, Connecticut towns have a unique model for building affordable housing, and many have trouble seeing LA as urban because of how car-centric its past is. Check out what's happening around the world in transportation, land use, and other related areas!


Photo by Humberto Moreno on Flickr.

Sunshine State expansion: Six rapid transit projects are now part of Miami's Metropolitan Planning Organization's long range plan. Many of these lines have been in previous plans, but they're now being made top priorities, which bodes well for their future completion. (Miami New Times)

New Affordability, CT: Cities in Connecticut are required to have 10% of their homes be affordable. If that isn't the case, developers can effectively ignore the zoning code as long as they build 30% affordable. This has led wealthier communities pushing for affordable housing. (New York Times)

Dirge for dingbats: The "dingbat," an infamous Los Angeles architecture form that's basically just a box-like apartment stuck on top of an open carport, is slowly disappearing for more aesthetically pleasing, dense, and safe structures. Are they worth restoring and preserving? (LA Weekly)

Edge City redux: Outside of Miami, the Atlantic Ocean and the Everglades make it so there isn't space to keep sprawling out, so buildings are going upward. Translation: Urban city centers are going up in the suburbs. (The Economist)

LA through #nofilter: Many still see Los Angeles as an ugly ode to cars and endless concrete, even as the city shifts toward becoming more traditionally urban, dense, and walkable. Why? It's hard for people to see beyond LA's built origins as a car-centric city. (Colin Marshall)

Uber exit: Uber is threatening to leave Houston if the city does not repeal regulations that require drivers get fingerprints taken and go through a licensing process. The company has already left three cities in Texas and is threatening to leave Austin as well. (Texas Tribune)

Tashkent trams: The capital of Uzbekistan, Tashkent, is shutting down its tram system. Opened in 1912, it is one of the oldest in central Asia. A lot of locals say the city is losing both a convenient and green form of transport, and a piece of its charm. (BBC)

Quote of the Week

"The idea is that by using a cryptographically secured and totally decentralized authority that can work at the speed of a computer, we should be able to keep power distribution, water treatment, self-driving transportation, and much more from ballooning beyond all practical limits as cities continue to grow." Graham Templeton on using Bitcoin Blockchain to run smart cities. (Extreme Tech)

Links


National Links: Hillary talks housing

Hillary Clinton is articulating her vision to help Americans with housing, what happens when people making decisions about transit don't know what it's like to depend on it, and a look at where row houses fit into the national landscape. Check out what's happening around the country in transportation, land use, and other related areas!


Photo by Veni on Flickr.

Hillary's housing hopes: Hillary Clinton wants living near quality jobs, schools, and transportation to be easier, and she's making affordable housing part of her agenda. Her proposal would boost funding for both programs that help people buy homes as well as public housing. (Virginia-Pilot)

Get the board on the bus: Given how much they influence how people get around, perhaps transit board members should ride the busor at least know details about the system they work on. Some recent applicants for the DART Board of Directors in Dallas are clueless when it comes to transit-oriented development and taxpaying riders. (Dallas Observer)

Reliant on row houses The row house is the workhorse of dense older cities around the country, but it's becoming less popular. It's possible that row houses could be the "missing middle" that can help address the country's housing needs. (Urban Omnibus)

Questioning King Car: Cars are a large part of American culture, like it or not. But they also cost a lot of money, time, and lives. Since September 11th, 2001, over 400,000 people have died in automobile collisions. Is that a worthwhile price to pay for convenience? (The Atlantic)

Bridges of Amsterdam city: Amsterdam has far more canals and bridges than the average city, but only one bridge runs across the large river that separates the more industrial side of the city from where most people live. There is a tunnel and a number of ferries, neither of which is idea for walking or biking. But as more development happens and free ferries are overwhelmed, a bridge may be the next step. (City Metric)

Struggling city streams: In the midwest, streams in urban places are rare. Detroit, for example, has lost 86% of its surface streams. That worries ecologists because streams regulate water flow and keep wildlife healthy. (Great Lakes Echo)

Are we building boredom?: Buildings designed like boxes are bad for us. Research shows that human excitement wanes on streets with boring facades, causing stress that affects our health and psychological wellbeing. (New York Magazine)

Quote of the Week

"I think it's important to remember that these are serious crimes with emotional consequences. It's interesting nonetheless to watch how burglars use architecture, but that isn't enough reason to treat them like folk heroes." - Architecture writer Geoff Manaugh discussing his new book, A Burglar's Guide to the City in Paste Magazine.

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