Californians Look to Address Affordable Housing in the Voting Booth

californiaOn November 8, voters in California will consider 17 statewide ballot measures. Direct legislation is more common in California than anywhere else in the country. Cities and counties throughout the state are adding referenda of their own, many of which aim to address housing affordability and homelessness. Ranging from housing bonds to zoning changes, these measures coincide with a heightened public awareness around housing and homelessness as the crisis intensifies in California.

Just last month, the Los Angeles County Board of Supervisors unanimously urged Governor Jerry Brown (D) to declare a state of emergency on homelessness, joining similar efforts by Los Angeles Mayor Eric Garcetti (D) in October of last year (see Memo, 10/5/2016).

California’s homeless population reached 115,000 in 2015, with nearly 74,000 individuals living unsheltered, according to the Annual Homeless Assessment Report assembled by the U.S. Department of Housing and Urban Development (HUD). According to NLIHC’s 2016 Gap Report, there is a shortage of 1,003,110 affordable and available units for extremely low income (ELI) renters—those earning 30% or less of area median income (AMI).

The housing and homelessness crisis has become particularly dire in Silicon Valley region, where skyrocketing housing costs have made the area unaffordable for those who have not benefitted from the tech industry’s prosperity. In response, San Francisco voters approved a $310 million bond last fall for the construction of affordable housing in the city (see Memo, 11/9/2015 and 10/13/2015). Voters in Santa Clara and Alameda counties will decide on similar measures this November.

  • Santa Clara County
    In Santa Clara County, a $950 million bond would generate funds to support housing development. The spending plan would allocate $700 million for ELI housing, including permanent supportive housing for those experiencing chronic homelessness and also rapid rehousing for victims of domestic violence and those leaving the foster care system. The plan also calls for $100 million to be allocated to serve very low income (VLI) households with incomes between 31% and 50% of AMI. The final $150 million will support housing for moderate income households, with $50 million dedicated to assist first-time homebuyers.

    To pay for the bond, the county would assess property owners $12.66 per $100,000 of property value. Costing the average homeowner less than $100 annually, the tax increase will retire the loan in an estimated 30 years. The bond has drawn support from San Jose Mayor Sam Liccardo (D), as well affordable housing developers and service providers throughout Silicon Valley. The San Jose Silicon Valley Chamber of Commerce opposes the measure. The group’s president and CEO issued a statement titled “Business is Under Attack,” criticizing a number of taxes and regulations under consideration in Silicon Valley. Among the Chamber’s members are tech giants Microsoft, Apple, Google and Intel, all based in Santa Clara County. The bond measure will require a two-thirds majority for approval.

  • Alameda County
    Alameda County’s proposed $580 million bond would invest in affordable homes for low-income renters, provide assistance for first-time homebuyers and create an innovation fund to acquire property and prevent displacement in high-opportunity areas. The spending plan would allocate $460 million for rental housing programs, designating at least 20% of units for households earning 20% or below AMI and ensuring all units have an affordability period of at least 55 years. Like Santa Clara County, Alameda County would fund the bond with a property tax increase of $12.50 per $100,000 of property value. The Alameda County measure, which will also require a two-thirds majority for approval, is supported by East Bay Housing Organizations, an NLIHC member.
  • San Mateo County
    Voters in San Mateo County, another hub of Silicon Valley companies like Facebook and YouTube, will decide whether to extend a half-cent sales tax increase by 20 years to fund affordable housing. The original tax, Measure A, was approved by voters in 2012 and has generated more than $80 million annually. Although the county cannot submit a tax extension for a specific funding purpose, the Board of Supervisors intends to allocate the ongoing revenue for affordable housing needs. The Board was also considering a bond measure similar to those in San Mateo and Alameda counties, but polling indicated it would not meet the two-thirds threshold to pass. An extension of Measure A would require only a simple majority.
  • Los Angeles County
    Southern California voters will also weigh in on measures dealing with housing and homelessness as the affordability crisis worsens. Los Angeles County has the second-highest homeless population in the country, at 46,874, and 83% of ELI households are severely cost burdened, meaning they spend more than half of their income on rent. City and county officials have begun to publicly commit themselves to ending homelessness, with Mr. Garcetti pledging $100 million in new funding this year. A larger, ongoing source of revenue is needed.

    The city of Los Angeles succeeded in placing a more ambitious measure on the November ballot: a $1.2 billion bond for the construction of housing to serve the lowest income residents. Approximately 80% of proceeds would fund permanent supportive housing and temporary shelters for homeless individuals, while up to 20% would fund affordable housing for ELI and low income residents who are not currently homeless. To finance the bond, property owners would pay between $4.50 and $17.50 per year for every $100,000 of assessed value. That amounts to $44.31 per year for a median-priced home in Los Angeles, with payments retiring after about 28 years. The bond measure will require a two-thirds majority to pass.

    Voters in the city of Los Angeles will also decide on the Build Better LA initiative, which would impose requirements for affordable housing and labor practices on real estate developments that seek waivers from city zoning rules (see Memo, 6/27/2016). Under one portion of the proposal, developments larger than 10 units that exceed regulations such as those limiting building density would have to make at least 5% of units affordable to ELI households. An additional 6% must be priced as affordable at the very low income rent threshold (50% of AMI) or 15% at the low income rent threshold (80% of AMI). The measure is backed by a broad coalition of labor and housing groups including the Southern California Association of Non-Profit Housing, an NLIHC State Coalition Partner.

    The Build Better LA initiative does have some opposition in the broader community advocates. Although the LA County Federation of Labor and several groups representing renters support the measure, it is opposed by the LA Tenants Union, who argue that the policy change would bring more luxury housing than affordable housing and thereby accelerate neighborhood displacement. The Build Better LA initiative will need only a simple majority to pass.

  • City of Santa Monica
    Residents in Santa Monica will vote on a half-cent sales tax increase to fund education and affordable housing. A sales tax cannot be dedicated for a specific purpose, so the City Council also placed on the ballot a companion measure that asks if the new revenue should be allocated with half of the funds for each purpose. The allocation referendum is advisory and non-binding, and the extent of the affordability is not clearly specified. The City Council included funding for the school district in order to give the measure a better chance of passage.

Beyond measures to build more housing that is affordable, tenant advocates are taking action to slow the escalation of rents in markets with tremendous scarcities of rental housing. In November, five communities in the Bay Area will consider referenda to adopt rent control policies that will cap annual increases in rent amounts. Advocates in the cities of Richmond, Mountain View, Alameda, San Mateo, and Burlingame collected enough signatures to qualify for the ballot. The referenda in San Mateo and Burlingame are being contested and their respective city councils will decide before the end of August if rent control will be included in November. In the City of Richmond, the rent control ballot measure will serve to counteract the City Council’s repeal of their existing rent control ordinance in November of 2015. More information about rent control initiatives can be found at the Tenants Together website.

NLIHC’s Advocacy Guide for the Election Season

nlihc-2016_issues-guideOver the next few months, affordable housing and community development organizations have an opportunity to influence a number of critical issues before Congress and to help break through the noise of the Presidential campaigns to make affordable housing an election issue.

This summer and fall, Congress will be in their home districts and states between August 1 and September 6 and again between October 10 and November 11.

To help advocates make full use of this time, NLIHC has created a Summer/Fall 2016 Advocacy Guide, outlining the five key ways organizations can take action between now and the November elections to advocate for the issues that are most important to their mission, the people they serve, and their community.

The Advocacy Guide covers ways organizations can help:

  • Increase federal spending on key federal housing programs;
  • Expand and improve the Low Income Housing Tax Credit;
  • Ensure that housing needs are addressed in criminal justice reform;
  • Support the Make Room campaign—an initiative to demand that Congress make affordable housing a top priority; and
  • Use NLIHC Voterization resources to engage voters and candidates.

For more information and best practices on how nonprofit organizations and individuals can lobby their elected officials, see Lobbying: Individual and 501(c)(3) Organizations in NLIHC’s 2016 Advocates’ Guide.

Together, these resources can help advocates make their voices heard and build strong relationships with their Members of Congress.

Join Evicted Author Matthew Desmond for the Make Room National Campaign Launch

desmond_matthewMake Room—in partnership with NLIHC and other national leaders—is launching an exciting national campaign to send 1 million messages to Congress about the critical need to end housing insecurity in America. Through the November elections, national, state, and local organizations will share a common message: our nation is facing a housing affordability crisis of record proportions that demands Congressional leadership.

Join Us!

Campaign Kickoff Call
Special Guest: Matthew Desmond,
Author of 
Evicted: Poverty and Profit in the American City

Monday, August 1, 2016
4:00 PM EST

RSVP HERE

All organizations and advocates are invited to join the campaign kickoff call to learn more about how to get involved. Please share this information widely.

MakeRoomMake Room is a partnership between Enterprise Community Partners, MacArthur Foundation, Ford Foundation, CohnReznick LLP, and others to give voice to struggling renters and elevate rental housing on the agendas of our nation’s leaders. For more details about Make Room and the campaign, see Make Room’s website.

 

Luxury Apartments and Housing Vouchers: Not Enough for the Nation’s Poorest Renters

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By Andrew Aurand

Emily Badger’s article in the Washington Post (“New housing in low-income areas yields less displacement”, February 16), based on a study by the California Legislative Analyst’s Office, leads readers to believe new market-rate apartments are the solution to the severe shortage of housing for the nation’s poor. The study Badger cites may make a compelling case for reducing barriers to housing in high cost areas with significant development constraints, but it does not support the assertion that building apartments for the rich is a better solution to meet the housing needs of the poor than building affordable housing.

As the theory goes, construction of market-rate apartments, even luxury ones, lowers prices for everyone. Households with sufficient income move into the new housing, making available their previous and older housing to other households, who in turn leave behind even older units, and so on. Eventually this results in increasing the availability of the oldest (and lowest cost) units to low income renters. However, this “trickle-down” approach fails to meet the needs of extremely low income renters, who earn no more than 30% of the area median income.

The California study pointed out that high-end housing produced in the early 1980s had dropped in relative price to the middle of the market today as evidence that older housing becomes more affordable over time. But this does not indicate an actual increase in the affordable housing supply for extremely low income renters (or even moderate income renters). A more important question is what has been the net gain in affordable housing units, taking into account the number of affordable units permanently lost during the same time period.

Older housing never becomes cheap enough for extremely low income renters. The national average of what a 4-person extremely low income household can afford in rent without experiencing a cost burden is $509. In the San Francisco region, where wages and also housing costs are higher, the most these renters can afford is $764. At these rents, owners are likely to redevelop the property for higher income renters. In weak housing markets, owners are likely to abandon the property when rent revenues do not cover the cost of adequately maintaining the property. The Joint Center for Housing Studies at Harvard found that the national gain in lowest cost, private-market rental units from 2003 to 2013 through filtering (older units becoming affordable) was matched by an almost equal number permanently lost.

Some argue that Housing Choice Vouchers combined with filtering are the solution to the housing needs of extremely low income renters. Voucher recipients contribute 30% of their income to the cost of their housing, and the voucher provides assistance for the rest, up to the local housing authority’s payment standard. At best, vouchers provide recipients with the means to afford quality housing in a location of their choice, making them an important component of affordable housing policy. Vouchers are the policy of choice in markets with excess housing supply, but unattainable prices to the poorest renters.

Vouchers are more difficult to utilize in tight, high demand housing markets. The payment standard for vouchers is approximately the Fair Market Rent, set at 40% to 50% of the region’s highest rent, constraining recipients to lower quality housing in neighborhoods and localities with lower housing costs. This assumes they are able to actually use the vouchers. News reports from California point out the difficulty voucher holders face in finding housing in tight markets where rents are higher than the payment standard. And low vacancy rates allow landlords to turn down voucher holders in favor of unassisted renters.

New construction of market-rate units may put downward pressure on prices in a tight market, but how soon does this new construction result in greater availability of moderately priced units for voucher holders?  The California study highlighted that it took 25 years for new high-end apartments to filter down to the middle of the market. The shortage of housing however is a problem today for millions of extremely low income renters and homeless individuals and families.

Housing production for extremely low income renters is a necessary third approach. The ‘balance’ we often hear in housing discussions gives too little attention to the challenges faced by these renters, for whom there is a national shortage of 7.2 million housing units. Filtering does little to address their needs. Vouchers are difficult to utilize in high demand markets. Housing production is needed. Many of our productive affordable housing programs today however allow rents that are far higher than what an extremely low income renter can afford to pay. For the first time, the National Housing Trust Fund will distribute funds to the States for extremely low income housing this coming summer, another piece to the puzzle in how to meet our nation’s housing needs. The Technical Assistance Collaborative and the National Low Income Housing Coalition, are identifying ways in which the money can be best used. And if we target more housing expenditures on housing for the households with the greatest need, the 7.2 million gap would likely decline.

Andrew Aurand, is Vice President Research at the National Low Income Housing Coalition. For feedback, follow him on Twitter @AGAurand or email him at  AAurand@nlihc.org

 

Home Is Where You Feel Physically and Emotionally Secure

Isabelle Headrick, Executive Director Accessible Housing Austin!

Isabelle Headrick, Executive Director       Accessible Housing Austin!

Isabelle Headrick is the Executive Director of Accessible Housing Austin! She has been a member of the National Low Income Housing Coalition (NLIHC) since 2005. On March 9th, the NLIHC Board of Directors elected her as a new Board Member. In this interview, we spoke to her about her decade-long affiliation with NLIHC and how she benefits from her membership.This interview is a part of our ongoing series of conversations with NLIHC members that we are presenting to our readers in the wake of NLIHC’s Membership Month. We asked Isabelle, among other topics, why she would recommend NLIHC to our prospective members.

Why are you a member of the National Low Income Housing Coalition (NLIHC)?

Since I first became professionally involved in affordable housing 13 years ago, I have been impressed by the quality of the policy work that NLIHC does in housing education and advocacy. NLIHC supports the work that we as advocates do at the state and local level by providing us with policy resources and advocating for funding at the federal level. So, I feel that it is critical to support the work that they do.

How did you first get involved in affordable housing?

I started volunteering in a homeless woman’s shelter in Chicago during high school. Later, my first job after being a stay-at-home mom was with a neighborhood-based community development corporation in Austin, Texas.

What do you find most challenging about affordable housing advocacy?

I’m frustrated by the fact that the current emphasis on getting the chronically homeless off the streets ignores (and in some cases diverts resources away from) the substantially larger population of invisibly homeless and housing-insecure Americans. Our policies are being driven by a movement that is not inclusive of all extremely low-income people, let alone of people who don’t need or want supportive services; and I think this is a mistake.

What is your best advice for housing advocates?

All housing advocates, even those with whom you may disagree sometimes, have incredible resources of talent, intelligence and dedication. Get to know your colleagues, find the issues on which you can collaborate, don’t be afraid to ask for help, and be generous in sharing your own expertise.

What is your favorite thing about being a member of NLIHC?

Knowing that my support translates into high-quality advocacy and policy work.

What does “home” mean to you?

For me, it means a place raise to my kids: a place where they will be comfortable and physically and emotionally secure, feel connected to their community and neighborhood, and have access by walking, bike-riding, or public transportation to their schools and friends.

Any good book recommendations? (i.e. books related to social justice, housing advocacy, homelessness, poverty etc.)

This is not directly related to any of those, but Edmund Morgan’s American Slavery, American Freedom: The Ordeal of Colonial Virginia is a fascinating read about the origins of slavery and racism in the American colonies – some of the very issues whose legacies we are still dealing with today.

What would you tell someone who is thinking about becoming a member of NLIHC?/ Why should someone join NLIHC?

NLIHC is the premier national organization advocating for very and extremely low-income renters and public housing residents. For those of us who live in states whose legislators do not support affordable housing funding, it is all the more vital to have an ally at the federal level.The annual Out of Reach report provides critical information about our states and communities to help us advocate for affordable housing to our policymakers and legislators. NLIHC gives us the resources to do our jobs as advocates…and advocates for the resources for us to do our jobs as affordable housing providers and homelessness preventers.

Describe a time when you have used NLIHC research.

I spoke to a Community and Regional Planning class at the University of Texas at Austin about quantifying the need for accessible, affordable and integrated housing for extremely low-income people with disabilities and showed them Out of Reach as a data resource.

Describe a time when you took action as a result of a Call to Action (CTA) from NLIHC.

I called my Congressman this week to ask for the sequester caps to be lifted and to advocate for HOME and the National Housing Trust Fund.

Read Related Interviews:

Why I Joined NLIHC: A Member’s Reflections
Affordable Housing for Extremely Low Incomes is Possible: Ruth A. Matz
Lack of Understanding of the Affordable Housing Crisis Is Frustrating: Anne M. Williams