Going Extinct Idaho s Hidden Gem Saving an Entire Asset Class of Affordable Housing
One Event From Catastrophe Low Income Renters are Our Most Vulnerable Population We have over 11 million renter households (in the US) that are paying more than half of their income towards their rent each month. That means they are one emergency, one broken down car, one illness, one missed day of work away from not being able to pay the rent. They are really at risk of losing their homes altogether and becoming homeless. -- Diane Yentel, President, National Low-Income Housing Coalition
Housing Deficit Extremely Low Income is the largest housing gap 30% of income or less = Affordable Boise has a housing deficit of 8,095 units
Ada County s Underwater Renters Very Low Income: $30,651 # of Households below Very Low : 38,723 Median Rent: $871 Income needed to pay it: $39,456
Canyon County s Underwater Renters Very Low Income: $22,430 # of Households below Very Low : 16,776 Median Rent: $773 Income needed to pay it: $37,104
From HUD: Idaho s Cost Burdened Families Low Income families paying more than 30% of their income to housing costs 17,070 Households 9,325 Households
Extinction Threat: Mobile Home Parks Entire Affordable Housing Asset Class Could be Totally Lost Mobile homes represent one of the few unsubsidized options Popular with: Working Families Hourly Wage Employees Disabled Retired Doing Nothing = Disappearing 1 by 1 Nobody Notices Developers & planners assume it s a good thing Cleaning up the neighborhood
Canary in the Coal Mine MH as a housing class has been neglected & forgotten These parks have already closed 1. Rushmore Mobile Home Park, Nampa a. Reason: failing infrastructure b. Date: May 2016 2. Karcher Village Mobile Home Park, Nampa a. Reason: failing infrastructure b. Date: December 2016 These are permanent losses. It s nearly impossible to get approval for anything except 55+ parks for middle class retirees.
Canary Has Died; Swift Action Needed Act now to preserve housing options & everyone will benefit in the future Examples: Small business owners Access to labor within commuting distance Urban residents Enjoy walkable communities due to small business thriving in city centers Local governments Economic development will be easier and faster with larger labor force Walkable communities use existing infrastructure; reduced need for expansion
The Case for Mobile Homes Pressures: Park owners can sell or repurpose anytime Failing Infrastructure NIMBY s pressure for removal Often targeted by regulators and zoning officials Popular assumptions: Displaced families would prefer newer or better looking apartment living Other, equally low-cost options exist Residents are nomadic and don t put down roots Reality: Residents own their homes, unlike apartments The street is most common Plan B Mobile homes are no longer mobile once placed; owners tend to stay put
Not In My Backyard (NIMBY) Middle Class doesn t want Affordable Housing of any type nearby It s just not people who are I guess of the same class as us which sounds bad but I don t mean that in a bad way. We don t want nomads; we don t want people who don t have roots. I just don t want that to be what my community is about. -- Neighborhood activist opposing mixed-use development nearby, referring to the people she thought would be her new neighbors. I work. I want to live near a place where there are better job opportunities. It took me six years to get my (Section 8) voucher, but I got it. You can best believe I m going to utilize it. -- Working mother who was force to give up her voucher after being unable to find a place that would take it. Current Housing Deficit: 8,095 units Housing Deficit, if we lost our Mobile Home Parks: 15,828+ (Only considers Boise deficit, this is what we can prove, but the actual number is higher) Preserving Mobile Home parks where they already are now provides low income residents the opportunity to live in desirable school districts near their jobs, without having to risk their financial security to do so.
Neighborhood Opposition Activists tend to be loud in their opposition Squeaky wheel syndrome Makes approval of new developments targeting lower income markets very difficult Middle/Upper Class Beliefs Low income families = crime Property values of expensive homes suffer Neighborhood will lose some cachet Affordable = transient What will think? Concern about friends & family Might see shabby people on the way over to visit
Solution: Convert MHCs to ROCs ROC: Resident Owned Community MHC: Mobile Home Community CIP: Capital Improvement Plan Mobile Home Parks already in existence = low hanging fruit ROCs are permanent Park is sold to the residents who live there Transaction is conducted like any other commercial property sale Condition of sale: must stay MHC forever Keeping a park does not require city or neighbor approval Local government is happier due to CIP CIP required for all new ROCs Under the radar The park just keeps existing like it always has No public meetings to draw attention
How to Convert to Resident Ownership Total MHCs in Treasure Valley 1. Ada: 63 2. Canyon: 75 Total Homes in Parks 1. Ada: 4,446 2. Canyon: 3,287 1. Form a company made up of park residents 2. Purchase the park from the current owner 3. Residents pay lot rents to ROC 4. ROC pays mortgage and monthly bills 5. ROC rehabilitates infrastructure 6. Pride of ownership = beautification 7. MHC becomes sustainable indefinitely
Advantages to ROCs Stability Resident-owned corporation lasts forever Residents never have to move as long as they pay lot rent Fairness Residents create and enforce park rules Loan compliance requires ROC to act fairly Affordability Residents must approve all lot rent increases, otherwise they don t go into effect Beautification Excess revenue saved and reinvested in community improvements
The Secret Sauce: National Network + Financing ROC USA: Unique No other program like this anywhere ROC Capital specializes only in ROCS Access to ROC Capital is a perk of being approved by ROC USA Owners favorable to selling when: Financing is assured Market price is paid Transaction happens in normal commercial-property timeframe ROC Capital approves and closes within normal timeframes Idaho has been invited to apply Must be approved to access special finance program and national network
Tried and True Model 30+ Years Experience 120+ Communities nationwide 35+ Communities in states surrounding Idaho Washington Oregon Montana Utah
Idaho is Missing Out Resident Ownership is Exploding All Around Us Neighboring states are successful due to ROC USA network and financing Preserved So Far: 36 Communities 1,928 Households
Idaho Goal GET APPROVED BY ROC USA As soon as humanly possible This gets us access to ROC Network & ROC Capital, the Secret Sauce! Long-term Sustainability 15-in-5 Concentrate at least a dozen ROCs in Ada and Canyon counties Creates sustainable revenue flows Use as springboard to serve rest of state Focus on high risk of loss first Offer empty spaces to families at risk of homelessness Create 15 Communities using the ROC USA model within 5 years