The District Ramps Up Efforts to Preserve Affordable Housing
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Inside the District’s affordable housing crisis: Is it the worst of times or the brink of “a new era”?
Anyone following the news knows that rents in D.C. have risen sharply during the last decade, forcing many low-income residents out of their homes.
“The reality is that affordable housing in DC is at a crisis level,” according to Steve Glaude, the executive director of the Coalition for Nonprofit Housing and Economic Development. “The average cost of a home now is around $750,000. Low-income people are being priced out of this market.”
Glaude is not alone in calling attention to the impact of the city’s rising rents. According to a recent DC Fiscal Policy Institute report, the number of low-cost apartments in D.C. fell by nearly half between 2002 and 2014. In 2002, the number of apartments where the monthly rent and cost of utilities were below $800 was at 58,000. By 2013, that number had dropped to 33,000 units.
Rising rents have forced renters to allocate an increasingly burdensome percentage of their income to pay the rent. One in three District renters spends more than 30 percent of their income. One in four spends more than half of their income on rent and utilities.
But some help is on the way. Mayor Muriel Bowser and the D.C. Council are focusing more attention on the issue this year. Earlier this year they passed a budget that includes more than $100 million in affordable housing supports, including funding to preserve, restore and create affordable housing. The D.C. Council is expected to consider new affordable housing preservation legislation in the fall.
“In terms of the sheer number and percentage increase, it’s the most substantial that’s been seen in the area in a very long time.” says Robert Burns, the CEO of City First Homes, a company that builds affordable housing.
“The new funds will allow the District to serve an additional 500 families in need of housing, while protecting 1,700 affordable housing units, and producing more than 500 new units,” Bowser told a group of real estate developers at an affordable housing real estate conference in June.
“Though the money cannot return those who have been displaced to their old homes, the aim is to stem the steady decline in the numbers of low-income housing in the District in recent years,” says Polly Donaldson, director of D.C.’s Department of Housing and Community Development.
“We’re on the brink of an entire new era of developing affordable housing following public policy priorities,” Donaldson says. “We are going to take that 100 million and leverage that at least 3-to-1 with private resources investment.”
Here is a breakdown of where the money will go and how it’s expected to help D.C. residents.
An additional $100 million for the Housing Production Trust Fund
The D.C. budget allots the Housing Production Trust Fund $100 million, doubling the amount of funding it received last year. The Trust Fund supports the construction, renovation and preservation of affordable housing in the District by channeling funds to non-profit and for-profit developers, as well as tenants looking to purchase their apartment buildings by exercising their legal rights set out in the Tenant Opportunity to Purchase Act.
The law, usually referred to by its acronym, TOPA, allows tenants living in apartment buildings governed by rent control to have a say in what happens to their buildings when they go up for sale.
Since its inception in 2001, the Housing Production Trust Fund has produced or preserved 7,500 affordable homes, sheltered 15,000 D.C. residents and ensured TOPA rights to thousands of residents, according to a 2014 report by the Coalition for Nonprofit Housing and Economic Development (CNHED). The Trust Fund “has invested $320 million in DC neighborhoods and leveraged an additional $794 million of financing from private and other sources, for a total of $1.1 billion in development,” the report states.
Despite these successes, housing advocates say funding for the HPTF has never come close to meeting the need in the city. Tenant advocates, led by CNHED, began pushing for expanding the Trust Fund’s five years ago and say the cash injection this year is a welcome development.
“Historically, one major issue has been funding,” says Latino Economic Development Center tenant organizer Robert Wohl. “There wasn’t a lot of money to support TOPA. The Housing for All campaign has been able to get the city to invest hundreds of millions of dollars into the HPTF. Now, the HPTF is an important source of support.”
“The Housing for All campaign petitioned every mayoral and council candidate over that 5-year period,” Glaude said. “It was really the Coalition organizing an advocacy and public policy effort that resulted in the $100 million.”
Now that the $100 million goal has been reached, residents must wait to see what this money can achieve. In order to prevent further gentrification, preserving D.C.’s already-existing affordable housing are key goals.
To help make things happen, Mayor Bowser is forming what she calls a “preservation strike force” made up of housing advocates and economic experts to advise her on where to funnel the money.
The “strike force” is a short-term working group “that will work to address housing preservation, specifically looking at those housing developments that are at risk of losing their affordability covenants or are about to lose their rental subsidy assistance,” Donaldson says.
“There are about 8,000 units at risk, so the mayor has asked me to chair the group in order to figure out a strategy to preserve the units that are at risk and to also come up with a resource plan for how we would go about financing that,” Donaldson says.
Though it is unclear right now where exactly the HPTF money will go, a portion is expected to help tenants embarking on the TOPA process—including many Latinos.
“Many Latino tenants, mainly more recent immigrants, live in rent-controlled housing in Northwest D.C.,” says Phillip Kennedy, the tenant-organizing manager with the LEDC. “A lot of this housing is going on sale and TOPA gives them an opportunity to keep their housing affordable rather than having to watch their homes turn into luxury condos.”
In order to tap HPTF money to build new affordable housing, non-profit organizations and developers must apply to the Department of Housing and Community Development by Oct. 5. The Department has called for projects that would create new affordable housing for some of the city’s lowest income earners. According to the criteria, 40 percent must be reserved for households earning no more than 30 percent of the Area Median Income (AMI). Another 40 percent will be reserved for households earning between 31 percent and 50 percent of AMI, with the remaining 20 percent dedicated to projects “that preserve occupied affordable housing” for households earning no more than 80 percent of AMI, according to the D.C. government.
The goal is to create what housing advocates call a “continuum of housing.” By using the HPTF money to fund housing for D.C.’s lowest-income and middle-income residents, officials and tenants advocates say is the best hope for Washington to retain a mixed-income population.
Additional funding for the Local Rent Supplement Program
The D.C. Council has also increased funding that goes to help people struggling to pay the rent. The city’s Local Rent Supplement Program has two missions. It provides rental assistance to families with the greatest need in the D.C. area and it subsidizes affordable housing providers.
According to city officials, most of the new funding is going towards the tenant rental assistance program with the remainder used to subsidize the work of affordable housing developers and providers.
The LRSP gives vouchers to individuals and families who find housing in D.C. but cannot afford to pay the full rent. The voucher allows the tenant to pay 30 percent of their income on rent, with the voucher covering the difference between that amount and the cost of rent.
“The LRSP can start to really get vouchers to people on that (waiting) list—both homeless people and people with unfit housing situations,” says Ericka Taylor, executive director of the DC Fair Budget Coalition.
Though activists say the increased funding is an important step, there are 41,000 D.C. residents currently on HUD’s waiting list. And the waiting list is currently closed. So as it stands now, only a fraction of the people on the list will be helped, while many other needy residents will be left out entirely.
Nevertheless, for those lucky enough to obtain LRSP vouchers, the program has proved one of the most flexible and effective tools available to help low-income households keep their housing, according to Ward 1 Councilmember Brianne Nadeau.
“That voucher, once you have it, stays with you as your income goes up. You get less money each month on your voucher but you still get to keep it,” Nadeau says. “With LRSP, if you lose your job, your voucher subsidy increases. It creates more long-term stability.”
However, the new funds are not enough to achieve Nadeau’s “dream scenario.”
“In a dream scenario, we would have enough money to use LRSP to get all of the people off of the HUD list and then start moving people out of public housing,” she says.
Though the exact number is still unclear, such a feat would involve hundreds of millions of additional dollars.
“The problem is so big that we have to keep pushing,” Nadeau says.
— Story and Infographics by Emily Birnbaum
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