27 States With City Housing Trust Funds

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1 2/10/15 LOCAL HOUSING TRUST FUNDS Funding Solutions for Affordable and Accessible Housing 73 Ci)es Who Have Housing Trust Funds 27 States With City Housing Trust Funds The most common revenue source collected by city housing trust funds are developer fees. The average amount of public and private funds leveraged for every dollar invested in affordable housing by city housing trust funds is $6.50 1

2 2/10/15 Who Benefits from Housing Trust Funds? Blight Reduc?on and Historic Preserva?on Affordable Housing for Veterans, Families, Elderly Home Modifica?on for Disabled Aus?n, Texas Fund Established by City Council in 1999 Seeded the Fund with $1M Annually for first 3 years City dedicates 40% of Property Tax from developments on city owned land towards affordable housing. Miami, Florida Administers proceeds of the 1% food and beverage tax. Implement the local con?nuum of care plan for Homelessness. Serves in advisory capacity to the Board of County Commissioners involving homelessness CharloTe, North Carolina Established in 2001 Funded through Housing Bonds Administered through city s neighborhood services division 2

3 2/10/15 Established in 2003 RS 40: Funded with one?me surplus funding of $21M Managed by the Louisiana Housing Corpora?on. The Ini?a?ve is advoca?ng for dedicated revenue. 3

4 Housing Needs in New Orleans Maxwell Ciardullo, Greater New Orleans Fair Housing Action Center New Orleans is facing dual housing crises: affordability and quality. Affordability: Property values and rents are going up, but income is stagnating o City wide home values are up 58% over inflation since 2000; As much as 250% in some neighborhoods o City wide rents are up 43% over inflation since 2000; As much as $300- $500 in many places o Median household income is the SAME today as it was in 2000: $37,000. o We still have a tourism and service-sector economy that pays lower wages. o We are becoming a New York or San Francisco real estate market, but we still have New Orleans incomes. 63% of the city is rent-burdened, paying 30% or more of their income in rent. That means a significant portion of our city has less to spend on transportation, education, childcare, healthy food, and healthcare because they are paying so much in rent. Particularly concerned about vulnerable groups, such as: o Disabled people in need of accessible units o People with HIV/AIDS o Homeless youth and adults Quality: New Orleans still has a vacancy problem Certain neighborhoods still have 25%-40% vacancy rates with blighted homes and lots scattered throughout neighborhoods In these neighborhoods, property values are not rising and continued investment is needed. While housing costs have soared, housing quality, especially for renters, has not kept pace. o 12,000 units w/ leaks inside and out; o 2,000 with mold, o 5,000+ without a smoke detector There is not a functional code enforcement system for this occupied blight. It leads to high turnover and displacement for renters and destabilizes neighborhoods for all residents. Conclusion: Few would argue that these are the problems our city still faces. The NHIF was intended to meet these challenges and we hope that it can be leveraged to address these dual crisis of affordability and quality.

5 Housing Trust Fund Considerations for New Orleans Alexandra Miller, Crescent City Community Land Trust Potential Revenue Sources for the NHIF Direct tax or millage current funding source for NHIF. Value capture sources focus on capturing the value generated by real estate development in strong-market areas to fund affordable housing and neighborhood revitalization. Examples include TIF funds (e.g. the Flint, Michigan model of imposing a TIF on vacant property), linkage fees on large new developments, and in-lieu fees from mandatory inclusionary housing programs. Fees and premiums focus on capturing small fees or premiums charged during the execution of everyday City business. Document recording fees and real estate transfer taxes are common sources. Set a Revenue Goal Make the Pie Bigger Based on overall objectives and the amount of funding needed to achieve these objectives How many units of affordable housing per year? How much blight alleviation? Is $2.3 million annually enough for what we want to do? Include the assumption that Housing Trust Fund funds can be leveraged several times (particularly when used to support affordable housing development). Direct services tend to be less apt for leverage but are appreciated by community. The HousingNOLA Plan, under development this year through the Greater New Orleans Housing Alliance, should help in determining a funding strategy and a relative amount for housing projects. Comparison city trust fund annual funding levels for cities with similar population sizes: o Minneapolis, MN; population 400,070; annual housing trust fund allocation $7.5M - $10.5M o St. Louis, MO; population 318,416; housing trust fund has distributed $65 million over 10 years (average of $6.5M per year) o Lexington, KY, population 308,428; housing trust fund was established in 2014 and seeded with a $2M allocation for When Funding Housing, Coordinate With and Leverage Existing Sources Consider coordinated application deadlines for RFPs for example, this year City NOFA for HOME funds was released in time to make HOME allocations before LIHTC applications were due. Consider intentionally issuing RFPs that support similar objectives to programs funded by City OCD and NORA and stating this intent in the legislation, in order to leverage these public funds. Consider complementary uses of funding for example, if NORA or OCD cannot fund predevelopment or homeowner training, consider funding these activities. Housing trust funds have the advantage of flexibility compared to other public sources of funds.

6 Balance Objectives by Setting a Vision Providing direct quality-of-life and blight reduction services to neighborhood residents is important and is one of the NHIF s stated goals. The NHIF s flexibility has allowed it to effectively serve as a source for these activities. Housing affordability and quality are also crucial objectives, and now that a 10- year citywide housing plan is under development, more information will be available about gaps in the current financing system for affordable housing. Consider adapting recommendations from the HousingNOLA Plan for the new five year master plan required by the NHIF legislation. Define Income Levels Served through Potential Housing Programs Current NHIF legislation is vague around the definitions of "low to moderate income" and includes no income restrictions on homeowner assistance (only the rental assistance component specifies a focus on benefiting low-tomoderate income individuals or families). Using the 80% AMI definition provided by HUD within the legislation as a key qualifying factor for both homeowner and renter assistance would help ensure this fund is supporting the great need for development of housing for low-tomoderate income individuals. Serve More Households with Less Funding Consider funding programs and innovative approaches that allow the NHIF or housing trust fund to serve more families with fewer resources. Examples include: Rental registry effective way of serving many families currently living in substandard rental housing with relatively low costs for start-up and administration. Permanently affordable community land trust investments for homeownership and/or long-term required affordability periods for rental increase the number of unit-years that each housing unit remains affordable, whether homeownership or rental, making all funded units work longer and serve more families. Land Reserve for adjudicated properties perform title clearance and pay holding costs to clear title for adjudicated or tax-delinquent properties which a qualified non-profit CDC has expressed interest in redeveloping, enabling these properties to come back into commerce and serve as affordable housing.