Iowa City receives $3.75 million affordable housing grant

IOWA CITY — Iowa City will be receiving a $3.75 million federal housing grant to create affordable housing pilot programs, evaluate local land use and regulation policies, and update regional housing plans.

Iowa City was one of 21 communities to receive the Pathways to Removing Obstacles to Housing grant from the U.S. Department of Housing and Urban Development. More than 175 communities applied.

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Iowa City Mayor Bruce Teague said it will take three to four years to implement the plans outlined in the grant application.

“I think that we’re going to take a step back with this grant and really look at the overarching opportunities that we have and create that base to ensure that we are solid moving forward,” he said.

Cities winning the HUD grant had to already have taken steps to make housing more accessible.

HUD identified Iowa City’s adoption of an Affordable Housing Action Plan and Fair Housing Choice study and the creation of an affordable housing fund as among the reasons the city received the grant.

“(Iowa City) has a proven track record of making change through creativity and innovation, which is very hard to do,” Elizabeth de León Bhargava, HUD assistant secretary of administration, said in a news release.

In its HUD application, the city said it plans to launch immediate housing assistance programs and provide housing counseling to residents.

The city reported that 22 percent of Iowa City homeowners with a mortgage and 61 percent of renters spend more than 30 percent of their income on housing, the benchmark housing officials consider ideal.

The city’s application identified local barriers to housing as restrictive land use policies, limited availability of housing and local development capacity.

As part of the grant, the city wants to update its comprehensive plan, adopted in 2013. The city said the plan no longer accurately reflects the current housing landscape.

Additionally, a study will be done to assess parking regulations and housing within the region

The city also wants to develop more affordable housing through the Iowa City Housing Authority and pursue housing development incentives.

Later this year, HUD plans to release an additional $100 million of funding through the Pathways to Removing Obstacles to Housing program.

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