Housing task force looks to the east
Waynesville — For the past six months, a task force has been grappling with the thorny issue of the affordable housing shortage in Haywood.
A recent study shows that more than half of the renters in the county are "housing cost-burdened," a term used if more than 30 percent of income must be spent on housing costs. The study indicated there is a deficit of more than 11,000 units in Haywood when it comes to affordable housing needs.
Fair market rent for a two-bedroom rental in Haywood is $811 a month. A person earning minimum wage would need to work 86 hours — or pay more than half of his or her salary — to afford the rent.
The Affordable Housing Task Force has spent the time gathering information, hearing from experts in the field and working to formulate a course of action.
Monday’s expert was Jeff Staudinger, Assistant Director of Community and Economic Development for Asheville, who told the group it is important to narrow down an action plan to confront the crisis.
When Asheville faced a similar problem in 2008, the approach ultimately developed a multi-prong solution — one focused on action as opposed to planning.
A vital step that allowed the plan to more forward was the passage of a $25 million housing bond, one that passed with 70 percent of the vote.
Using the funds to simply build affordable wouldn’t significantly put a dent in the 5,000 to 6,000 units needed, Staudinger explained, so ways are being sought to leverage the funds to encourage private developments.
“It would cost $150,000 to create one tax credit unit of affordable housing,” Staudinger explained, “so $25 million would build 250 units.”
To stretch the available funds, the city looked for city-owned property that could be used for housing developments and worked with developers to create incentives that would entice them to include affordable units in existing developments.
“In a strong marketplace, there is very little business incentive to build affordable housing,” Staudinger said. “We were trying to at least level the playing field through incentives.”
The plan that was developed in 2014 included everything from six unit complexes to “infill” areas that ranged from having several vacant lots to 150-unit developments. The plan’s goal was to build 2,800 new units by 2022, and the city has already met half of that goal.
Repurposing city-owned property has helped keep the development cost down, and other permit and fee waivers provided an added incentive.
“We relied on new partnerships, maximized state and federal programs in place and convinced neighborhoods [that] density is healthy,” Staudinger said, adding it is almost certain there will be a federal reduction funds for housing.
Asheville’s housing plan is examined annually, and the available funds are used to not only strengthen affordable housing for low and moderate households, but to expand opportunities for the middle class and the homeless, including permanently supported housing for those with intellectual disabilities.
“We prioritize action for the highest return on investment,” he said, noting one of the challenges was to determine how long units should remain affordable before they are turned into market-rate housing that’s sustainable.
Other specific programs that are part of Asheville’s plan include:
• A housing trust fund that allows for direct rental and ownership housing financing at a 2 percent fixed rate for 15 years, as long as 20 percent of the project includes affordable housing units. Special terms are available for units where 60 percent of the units are affordable.
Financing is available to entities such as churches that are interested in building homes for the homeless. The advantage of having a municipal partner willing to co-underwrite deals and take a junior lien position makes deals more attractive to the banks, Staudinger explained.
• Zoning incentives make it possible for homeowners to add a second unit on their property or perhaps remodel a home to accommodate two rather than one family, plus adjust rules allowing for much smaller homes.
• Tax increment financing uses taxes for a certain period to support a change of use on a particular property, deferring collection a period of time.