Government

Cedar Rapids considers reinstating affordable housing commission

Group could lessen conflicts and increase affordable housing stock

Alfredo Verduzco with MBG Framing secures vapor barrier material to the exterior as construction continues April 5 on the Crestwood Ridge Apartments building in northwest Cedar Rapids. The Commonbond Communities project has 41 of the 347 affordable housing units in the pipeline in Cedar Rapids, but demands for hundreds more exists. (Jim Slosiarek/The Gazette)
Alfredo Verduzco with MBG Framing secures vapor barrier material to the exterior as construction continues April 5 on the Crestwood Ridge Apartments building in northwest Cedar Rapids. The Commonbond Communities project has 41 of the 347 affordable housing units in the pipeline in Cedar Rapids, but demands for hundreds more exists. (Jim Slosiarek/The Gazette)

CEDAR RAPIDS — An affordable housing commission that’s been dormant for about 20 years in Cedar Rapids could be reactivated next week in hopes it can examine the big-picture issues of housing and poverty as well as inspect upcoming housing developments geared toward those with lower incomes.

City Council member Scott Olson began proposing the commission as he ran last year for mayor, but affordable housing was identified as one of the top needs by several candidates running for office. Olson, who served as chairman of the commission in the 1990s, came up short in his campaign for mayor, but eventual winner Brad Hart took up the cause.

“It’s a way to supplement what the city is already doing with people more directly connected to the issues,” Hart said in an interview.

The City Council is expected to vote on whether to reinstate a 21-member commission at its next meeting at noon Tuesday at City Hall, 101 First St. SE. Approval would mean city staff can begin taking nominations for representatives from specific social service groups and housing industry sectors.

Represented would be one person each from Willis Dady Homeless Services, Habitat for Humanity, Matthew 25, Waypoint Services, HACAP, Affordable Housing Network Inc., United Way of East Central Iowa, Linn County Housing Trust Fund, Civil Rights Commission, NAACP, Iowa Legal Aid, Linn County Veteran Affairs, Linn County Community Services, a nonprofit lender, a Realtor, landlord, housing developer and a community member from each of the city’s quadrants.

Appointments are expected to be made yet this month, and the commission would begin meeting next month, according to an outline of the plan.

COMMISSION First CREATED IN 1991

The commission originally was created in July 1991 and has not been active since the late 1990s, according to information from the city.

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The commission was abandoned because it no longer had money to distribute and other organizations — including the Metro Area Housing Plan and Four Oaks — were filling the same role, recalled former Cedar Rapids Mayor Lee Clancey and council member Olson.

“The reason, as I understand it, as terms expired, they didn’t get reappointed,” Olson said. “They felt since there was no funding allocated, what was the purpose of the commission since they weren’t able to help people with money. ... And, they just felt there were other agencies that were doing the work.”

Olson said he hopes future city budgets include a funding stream for the commission, which could allocate stipends or incentives for developers of affordable housing.

The new incarnation is expected to review the annual housing needs assessment and low-income housing tax credit applications received by the city, discuss opportunities to leverage resources based on local needs and resources and identify legislative issues that may include new trends or barriers to access programs, according a city description.

Hart and Olson said the commission would help the flow of information among advocates about upcoming projects, policies and what each other are working on.

“It is really important our municipalities, the city, the county, are taking affordable housing as a concern,” said Phoebe Trepp, executive director of Willis Dady. “Creating a commission raises the profile of the issue.”

Trepp said she does not believe the commission would duplicate the work of other agencies. She said she hopes it focuses on the most severe of the low income populations and examines policy changes, such as for inclusionary housing.

BIG DEMAND FOR ‘AFFORDABLE HOUSING’

The Affordable Housing Network defines affordable housing as housing that costs less than 30 percent of a household’s income. According to the that guideline, a family earning $2,000 a month shouldn’t pay more than $600 a month for housing.

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Cedar Rapids has nine projects with 346 units deemed affordable in the pipeline or recently completed, according to city data. But demand exists for much more.

The latest Maxfield Housing Market Analysis projects a need for 97 “deep-subsidy” units and 435 “shallow-subsidy” units over the next five years, and an additional 910 deep-subsidy units and 155 shallow-subsidy units for seniors by 2023.

In this case, “affordable” generally refers to subsidized housing and is reserved for people earning less than the area median income, which is $79,900 for a family of four.

The study defines shallow-subsidy as those earning 40 to 80 percent of the area median income, and deep-subsidy as those earning 50 percent or less of the area median income.

LOW-INCOME HOUSING CAN BE A FLASH POINT

Affordable housing can be a flash point in the community.

Neighbors spent two years resisting a low income housing complex called Crestwood Ridge Apartments, 1200 Edgewood Road NW, in 2016 and 2017. Crestwood offers five units for chronically homeless individuals, seven for those earning 40 percent of the area median income, 29 for those at 60 percent, and four at market rates.

Neighbors cited concerns about traffic, stormwater runoff and safety, but faced accusations they simply didn’t want low-income housing in their neighborhood. The City Council initially rejected the plan. but several months later changed course.

The commission could help mitigate challenges on projects such as Crestwood, which is expected to open in late summer, Olson said.

Olson said the commission’s role would be to start dialogue with developers earlier — working with them on selecting the best site and encouraging productive communications with neighbors.

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“If someone wants to apply for a grant, it comes before the commission and they can say, ‘Here’s what you need to do before moving forward with the project,’ so we don’t have situations like we had there,” Olson said.

POSSIBLE SOLUTIONS EXAMINED

The Lincoln Institute of Land Policy has published articles on several tools and policies used around the country and world to support affordable housing development, such as inclusionary housing policies and value capture.

Inclusionary housing, which is used by at least 500 municipalities in the United States, requires developers of new multifamily housing complexes to set aside a portion of units for affordable housing, according to the institute.

Value capture allows a municipality to “claw back” some of the land value gained from public policy or investment, such as rezoning or a public infrastructure project, to pay for a project that otherwise wouldn’t occur, such as affordable housing, according to the institute.

On the other hand, including affordable units in a development can undercut its financial feasibility, reports the Urban Institute and National Housing Conference. For example, lower-cost units would mean less projected revenue, which could decrease the ability to secure a construction loan, the report found.

Hart, the mayor, said all concepts could be on the table for the commission to discuss, but forcing developers’ hand through an inclusionary housing policy would not be his first choice.

“What’s worked generally has been to incent developers to do that,” Hart said. “To require developers to do that, personally, I think that would not be the first thing I would plan to do. If it was not progressing rapidly enough, I think we could weigh our other options. I think government regulates businesses enough, so if incentives are working, why would we place a restriction on somebody that would rather not do it?”

l Comments: (319) 398-8310; brian.morelli@thegazette.com

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