Ned Murray, PHD, AICP

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Community Development Strategies The
Affordable Housing Puzzle FLORIDA
REDEVELOPMENT ASSOCIATION MIAMI, FLORIDA October
18, 2006
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Assembling the Puzzle

• Affordable Housing Tools

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Affordable Housing ToolsOverview

• Ways to develop housing that is affordable
• Encourage private sector development
• Utilize good land use practices
• Layer conventional and non-conventional funds
• Create new sources of long-term financing
• Identify local strategies

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Affordable Housing ToolsDevelopment

• Incentives
• Density Bonus
• Fee Waiver
• Fast Track Permitting
• Design Flexibility
• Direct Subsidies
• Tax Abatement
• Mandates
• Inclusionary Zoning

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Affordable Housing ToolsLand Use

• Smart Growth
• Infill Development
• Urban Growth Boundary
• Advantages
• Density lowers land costs
• Mixed use reduces infrastructure needs
• Green building design lowers energy costs
• Reduces sprawl and preserves land

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Affordable Housing ToolsFunding

• Federal
• Community Development Block Grant (CDBG)
• Can provide funding for housing (dependent upon
  local needs)
• Loan Guarantee Program (Section 108)
• Transforms a small portion of CDBG funds into
  federally guaranteed loans for projects that will
  have a large community impact
• HOME Investment Partnership Program (HOME)
• Provides non-amortized, low interest loans to
  developers for acquisition and/or new
  construction or rehabilitation of affordable
  rental housing to low income families

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Affordable Housing ToolsFunding

• Federal
• Department of Housing Urban Development
• (HUD)
• CDBG
• Section 108
• Section 8
• HOME

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Affordable Housing ToolsFunding Other Federal
Programs

• Federal Home Loan Bank of Atlanta
• Community Reinvestment Act
• Government Supported Enterprises
• CDFIs

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Affordable Housing ToolsFunding

• State
• Sadowski Act
• Funded by documentary stamp tax revenue from the
  sale of homes to help provide low, very low and
  moderate income housing
• Responsible for developing ownership and rental
  housing, leveraging funds 71 and funding
  programs such as SHIP and SAIL
• According to the 2006 Legislative Session, only
  433 million will be allocated (an additional
  1.1 billion is available)

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Affordable Housing ToolsFunding

• State
• Community Workforce Housing Innovation Pilot
  Program (CWHIP)
• 50 million available in forgivable loans for
  construction or rehabilitation of housing for
  essential workers (up to 140 percent of the
  area's median income ) in high-cost counties

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Affordable Housing ToolsFunding

• Local Housing Programs
• Tax Increment Financing (TIF)
• Local doc stamp
• Other Sources
• Intermediary Organizations (i.e. LISC /
  Enterprise Foundation, NeighborWorks)

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Affordable Housing ToolsFunding

• Public Sector
• Dedicated source of funding
• Sales taxes
• Doc stamp
• Linkage fees
• In-lieu of fees (Inclusionary Zoning)
• Excess revenues
• Property tax increases

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Affordable Housing ToolsFunding

• Housing Trust Fund
• Capitalizes corporate and community investors and
  voluntary donations from local corporations,
  foundations, government, and individuals
• Allows for both Restricted (i.e. Managed
  Municipal Funds) and Unrestricted Funds
• Advantages
• Leverages funds
• Provides capital to assist individuals (i.e.
  homebuyer assistance and second/soft second
  mortgages)
• Provides financing and capacity building
  opportunities for affordable housing developers

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Affordable Housing ToolsFunding

• Equity Fund
• Allows investors to simultaneously improve the
  community while making a profit, satisfying both
  a financial and social objective
• Advantages
• Encourages investment within the community
• Provides capital for mezzanine and gap financing
  to affordable housing developers

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Affordable Housing ToolsFunding

• Community Land Trust
• Separates the ownership of the house and the land
  so that a non-profit organization holds the land
  in asset and offers long-term leases to
  homebuyers
• Advantages
• Lowers costs of housing
• Keeps property affordable in perpetuity
• Provides access to land, the most valued
  resources in development

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Affordable Housing ToolsLocal Strategies

• Initiate public outreach and education programs
• Develop public/private partnership among
  stakeholders
• Determine applicable policy solutions
• Advocate for policy change
• Identify long term funding sources
• Increase ability of residents to own homes while
  ensuring development of rental units
• Create new affordable units while preserving
  existing affordable housing

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From Puzzle to Picture

• Affordable Housing Partnerships

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Broward Housing Partnership

• Formed in early 2005
• Mission Statement To pioneer new approaches,
  create new tools, and influence housing policy to
  improve the production and sustainability of
  affordable housing through its consortium of
  member organizations in Broward County. 

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Broward Housing Partnership

• Public/Private Partnership
• Over 80 organizations involved
• Major Employers
• Government agencies
• Nonprofit organizations
• Housing Advocates
• Development firms
• Realtors
• Lenders

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Broward Housing Partnership

• Affordable Housing Summit
• Educated over 500 participants
• Best practices from 12 National Speakers
• Conducted a housing survey of registrants
• Facilitated consensus building session

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Broward Housing Partnership

• Potential Affordable Housing Tools
• Identified over 80 potential tools for
  affordable housing development
• Determining effectiveness of each solution
• Investigating improvements to each program
• Analyzing the feasibility of implementing each
  solution in Broward

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Broward Housing Partnership

• Housing Needs Assessment
• Homeownership is becoming unattainable.
• The ratio of median single family home costs to
  median household income is 61.
• The median sale price of 361,100 requires a
  household income of 90,720.

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Broward Housing Partnership

• Housing Needs Assessment
• Homeownership is becoming unattainable.
• The inventory of affordable rental housing is
  decreasing.
• The median rent of 1,122 requires a household
  income of 45,000.
• Over 22,000 units have been lost to condominium
  conversions in the past two years.

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Broward Housing Partnership

• Housing Needs Assessment
• Homeownership is becoming unattainable.
• The inventory of affordable rental housing is
  decreasing.
• Households are becoming increasingly cost
  burdened.
• Approximately 50 of the workforce have annual
  incomes of 25,000 or less.
• Over 41 of households spend more than 30 of
  their income on housing costs.

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Broward Housing Partnership

• Housing Needs Assessment
• Homeownership is becoming unattainable.
• The inventory of affordable rental housing is
  decreasing.
• Households are becoming increasingly cost
  burdened.
• Population and job growth will continue to fuel
  the demand for housing.
• By 2012, job growth is projected to create a
• demand for 90,000 additional housing units.

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Broward Housing Partnership

• Strategic Solutions
• Informed by
• Survey Results
• Needs Assessment
• Potential Tools Matrix
• Year long review of best practices
• Affordable Housing Summit presentations
• Consensus building sessions
• Vision Broward
• Affordable Housing Summit
• Partnership meetings
• Local housing meetings

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Broward Housing Partnership

• Strategic Solutions
• Educate the public and stakeholders
• Capitalize and operate a family of funds to
  provide funding for attainable housing
• Provide capacity building and technical
  assistance for CDCs, developers, and government
  agencies
• Develop incubator for creative housing solutions
• Advocate for public policy improvements

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Contact Us

• Dr. Ned Murray
• FIU Metropolitan Center
• 305.349.1444, murrayn_at_fiu.edu
• James Carras
• Carras Community Investment
• 954.415.2022, carras_at_bellsouth.net