On April 27, the National Low Income Housing Coalition convened a pre-conference research institute titled, Brave New World: Achieving Deep Affordability in an Age of Fewer Vouchers, to present findings from NLIHC’s Alignment Project. The Alignment Project examines the extent to which existing federal housing programs serve extremely low income (ELI) households, and identifies strategies employed by affordable housing developers to serve ELI households without the use of vouchers. Included in the Alignment Project is NLIHC’s third analysis of state and locally funded sources of revenue for rental housing assistance and capital. The goal of the project is to better align existing federal housing resources with the need for affordable housing among ELI households.
Sheila Crowley, the President and CEO of NLIHC, opened the institute, stressing the importance of finding new and innovative models of achieving affordability of rental housing for ELI households given the constraints on the HUD budget in the era of cuts to domestic discretionary spending, She outlined the multiple elements of the Alignment Project.
To explain why it is so important to create housing that is affordable to ELI households, Megan Bolton, NLIHC Research Director, reviewed the latest data on housing need in the United States. NLIHC’s analysis of 2012 American Community Survey data shows that there is a need for over 7 million additional affordable units to serve ELI renters. She also previewed NLIHC’s soon-to-be-released database of 353 state and locally funded affordable rental housing programs.
Althea Arnold, NLIHC Research Analyst, presented findings from NLIHC’s analysis of a 5% random sample of Low Income Housing Tax Credit properties in Florida, Maine, Ohio, Oregon and Virginia to determine the degree to which the program reaches ELI households. The sample included 104 properties with a total of 8,758 units. NLIHC found that 36% of the LIHTC units are occupied by ELI households and 70% of these ELI households have some type of rental assistance. Of the 30% of ELI households without rental assistance, only 17% were renting affordably, paying 30% or less of their income for housing. While 83% were cost burdened, 57% were severely cost burdened, paying more than half of their income for their homes.
Mindy Woerter of Avesta Housing in Portland, ME presented findings from NLIHC’s analysis of their portfolio of 889 LIHTC units. Revenue from federal rental assistance, especially Section 8 vouchers, is not only necessary for Avesta to able to serve ELI households, but also is essential to the financial sustainability of LIHTC properties.
The second half of the institute focused on NLIHC’s findings from interviews with affordable housing developers who serve ELI households. Elina Bravve, NLIHC Research Analyst, presented the key findings from these interviews, and introduced two developers who are featured in NLIHC case studies because of their innovative projects.
Ginger Segel of Community Frameworks in Spokane, WA discussed the Quixote Village Project in Olympia, WA, a self-governed community of formerly homeless individuals. The project consists of thirty cost-efficient micro-units built around a community center. Ms. Segel said cheaper, smaller permanent supportive housing units are possible but this type of model needs flexible funding. She talked about the importance of donated land, private donations, and Washington’s Operations and Maintenance Fund to the feasibility of this project.
Nancy Rase of Homes for America (HFA), based in Annapolis, MD, presented on their work in the Mid-Atlantic region. She emphasized the importance of reducing debt and maximizing equity in order to serve ELI households. She discussed jurisdictions that supported HFA’s projects by providing payments in lieu of real estate taxes. HFA’s goal is to set aside 20% of units in each property for ELI households, with 10% going to households at 15% of Area Median Income. They can often achieve this by renting the other units to people with incomes between 31% and 60% of AMI.
Ann O’Hara of the Technical Assistance Collaborative presented strategies used by three State Housing Finance Agencies (HFAs) in their Qualified Allocation Plans to create permanent supportive housing and discussed how similar strategies could be used when HFAs and other state agencies distribute National Housing Trust Fund allocations. In North Carolina, the Key Program provides an operating cost based subsidy to fund the difference between an approved payment standard and 30% of a tenant’s rent. Pennsylvania uses capitalized development funding from an increased developer fee to make up the difference between a 20% AMI rent and a 50% AMI rent for 15 years. Finally, Massachusetts is piloting a value voucher subsidy that makes up the difference between a rent affordable to a household on Supplemental Security Income (SSI) and rent at 50% AMI.
NLIHC’s Alignment Project has been funded with grants from the John D. and Catherine T. MacArthur Foundation, Capital One, the Freddie Mac Foundation, and the Technical Assistance Collaborative.
View the presentation’s slides from this Institute at: http://bit.ly/1fK3fGI
Watch for the release of all the Alignment Project reports this month.