Wilmington could soon see a housing bond. How has it worked in other NC cities?
Housing bonds have allowed several major North Carolina cities to start addressing the affordable housing crisis. Wilmington Mayor Bill Saffo recently told WHQR that residents could see one on the ballot in 2022. The idea also received 78% support in an affordable housing study conducted for Wilmington and New Hanover County and presented this week. WHQR took a look at how similar bonds, which have already passed in other cities, have been used.
Asheville, Greensboro, and Raleigh have collectively passed over $100 million in housing bonds -- long-terms loans approved by voters on the local ballot.
While these bonds have been critiqued by both progressives and conservatives, they have overall been fairly popular. In 2016, Asheville and Greensboro passed bonds with 71 and 68 percent of the vote -- and in 2020 Raleigh passed its fourth housing bond with a record 72 percent approval.
But once cities have the money, then what?
“City of Asheville, kind of tried to define our role, which was, first and foremost, probably a funding source. And second, and just as important, probably the convener collaborator. And then third, what real estate we put into the mix as well. And then fourth is what can we do about our, around our regulations and ordinances.”
That’s Paul D’Angelo, Asheville’s director of community development, who says it takes a whole range of tools to deal with housing, from federal tax credits to non-profits like Habitat for Humanity, from repurposing public land to finding ways to cut costs for developers. It’s an approach he’s honed over the last decade, including eight years in Wilmington, advocating for affordable housing in both the public and private sector.
And it’s getting the private sector to come to the table that’s perhaps the most important part of the housing puzzle, that’s according to Stanley Wilson, who is D’Angelo’s counterpart for the City of Greensboro.
“Well, you know, the biggest in the only way really to tackle affordable housing is through public private partnerships.”
So, how do cities get private developers -- who could just as easily be building more profitable luxury apartments -- to consider affordable housing projects?
Wilson says Greensboro has had to be flexible -- and not rely solely on the Reagan-era federal tax credit program that has, for decades, been the main funding source for affordable housing.
“I think it's being open to do something different, you know, and what I mean by that is, you know, their, their approach to affordable housing is a little bit different, in fact, that they don't want to apply for tax credit, you know, deals that they're not looking at it that way. So it's really trying to create a mechanism that will work that will help meet some of their goals, but also to not make it as regulated.”
Asked to cut down to the marrow of the issue, D’Angelo says it’s about money, something he took away from an affordable housing presentation.
“... a developer stood up and said, if you want affordable housing, you need to write us a check. And like, you know, laughter in the room, but like I took away from it later that night thinking about it was, it's about that subsidy, it's about the money that needs to be made available.”
Using taxpayer money to incentivize developers is bound to have its critics, but it also works.
To understand how it works, consider Asheville’s cost of directly subsidizing a single unit from market rate to what’s considered affordable for someone making 60% of the median income.
“When you do that math, 400 bucks a month, for 12 months for 20 years. It's like $96,000.”
Working with private developers, D’Angelo says his city has generated about 370 affordable units over the past year and half -- at an average investment of $36,000 each, less than half of the cost of directly supporting a renter.
D’Angelo says he’s proud of those numbers -- but they represent just 10 percent of Asheville’s affordable housing needs -- and the city, like many others, still struggles to address homeownership.
But, rather than being daunted, he hopes the early successes encourage cities like Wilmington to go big.
Take, for example, Raleigh’s $80 million bond -- which the city successfully passed on top of a recurring one-cent tax that generates over $6 million annually for affording housing.
Larry Jarvis, Raleigh’s Housing and Neighborhoods director, says the ambitious price tag will allow the city to map affordable housing development on top of its new transit plan.
“The housing bond really was in response to the implementation of the Wake transit plan. So the initial phases of the transit plan are kind of anchored by four bus rapid transit corridors...So what council wanted to do was to make sure that we were out of head ahead of us transit improvements, investments, and that we took a great look at opportunities to acquire sites now for future affordable housing development, so that we can ensure that we've had affordable housing near those transit investments. So the whole idea, the whole concept is equitable development around transit.”
Wilmington is a long way from a project of that scale or scope, but as the conversation moves forward, at least some are bound to measure local success by what our fellow NC cities have done so far.