In the current economic recovery, incomes for many US citizens have not kept pace with the rising cost of living and the gap is getting wider. In growing urban areas like Raleigh1 and across the country, the gap between stagnant wages and rising housing costs is magnified even more.
The City of Raleigh has responded to declining housing affordability by developing updated affordable housing policies and significant new and reliable funding ($5.9M / year) to triple the production and retention of affordable housing over previous years. The City has also increased the supply of forgivable rehab loans to qualifying homeowners. But without a method to estimate lost affordable units, we don't know if we are gaining or losing.
While the growing gap between wages and the cost of living is often driven by policies outside Raleigh, the City has a responsibility to periodically review and update our policies and programs to ensure we are doing the best we can to mitigate the impact of these changes on vulnerable populations and to ensure that the greatest number of citizens can continue to be healthy and productive members of our community. Raleigh citizens' ability to realize their potential and contribute to our economy is directly related to their opportunities for sound basic education, health care, healthy food, employment, transportation and affordable housing that meets their daily needs.
While this rising cost of housing is a citywide problem, it is being felt most strongly near downtown by those such as service and creative workers and by fixed income residents. The planned redevelopment of two privately owned senior apartments downtown to higher rents is a very visible example of the growing gap between incomes and housing costs, and illustrates the need for Council to take a closer look at how our affordable housing programs are working downtown and citywide. Where are the opportunities for improvement, and what specific actions should the City take to improve housing opportunities so that downtown seniors living on very low incomes and working families facing rising cost will have affordable housing choices that meet their daily needs?
Initial List of Affordable Housing Issues for Consideration
1. Regarding the Wintershaven and Sir Walter Apartments residents downtown2: investigate what specific actions are underway or may need to be taken by the City and in cooperation with the County and non-profit 'housing navigators' to ensure that those seniors will continue to have affordable housing choices that meet their daily needs.
2. Review progress of Raleigh's affordable housing plan including the following: publicizing our successes, identifying emerging challenges and best practices, investigating opportunities for increasing forgivable loans, use of Certificates of Participation funding for critical needs, and other opportunities for improvement that may be identified.
3. Establish liaison with the Wake County Affordable Housing Task Force to ensure that City and County efforts are well coordinated3. Learn about the County initiative to provide small surplus parcels to nonprofit affordable housing developers and learn about the County method for estimating lost affordable units, and then use that method to estimate Raleigh's lost units and establish Raleigh's net production goals
4. Consider modifying City policies to measure affordability by the combined cost of housing and transportation - as a more accurate measure of the costs of living for a given location. This will become even more meaningful as increased transit options become available.
5. Consider replacing Raleigh’s new zoning code (UDO) prohibition on affordable housing with performance standards tied to the Affordable Housing Plan criteria for location, Area Median Income (AMI) rent ranges and other factors.
6. Consider a density bonus program to support affordable housing funds or units, perhaps similar to the program being developed in Durham.
7. Consider zoning rule change that would allow micro dwelling units, perhaps similar to Greensboro's Tiny House initiative4.
8. Consider zoning rule text change to reduce or eliminate parking requirements for affordable units, especially near transit.
9. Consider synthetic Tax Increment Financing (TIF) funding similar to Asheville5 and other alternative financing options for affordable units. (Note that while per-unit TIF funding is higher than tax credit funding, the TIF funding comes from new tax base that would not otherwise exist.)
10. Solicit additional input from Councilors, County Commissioners, the public, neighborhood leaders and affordable housing experts and advocates. Make it clear we are open to solutions.
Raleigh’s economic success creates the opportunity to share our prosperity more broadly. When more of our citizens can realize their potential and become both contributors and beneficiaries of our success, we all prosper.
2. Wintershaven tenant leases end mid-2018. Sir Walter Apartments leases end in 2020.