Affordable housing: tackling the issue that affects all

Addressing housing crisis requires multi-faceted approach

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Affordable housing shortages: it’s a problem so prevalent in Tompkins County that it was a critical part of the 2020 county budget, not to mention the many news stories on projects and plans to solve it. Simply put, there is not enough affordable housing to meet demand, and as those involved in the issue can attest, it’s a problem that’s been building over time, and solving it requires a complex approach and collaboration between organizations and legislative bodies across the county.

Need

“The high cost of housing is one of the biggest challenges facing Ithaca today,” Ithaca Mayor Svante Myrick said in an October press release. 

The Tompkins County Department of Planning and Sustainability’s 2016 Housing Needs Assessment Survey backs up this statement.

“The existing housing stock is insufficient to meet current and future housing needs without forcing households to pay unaffordable housing costs, accept substandard housing conditions, and/or live outside the county,” according to the 2017 Tompkins County Housing Strategy.

In other words, housing affects everything, said Martha Robertson, chair of the Tompkins County Legislature. Without safe, secure housing, people can’t take steps toward self-efficiency, economic security or mobility.

On top of that, high housing costs within the city of Ithaca mean that people are settling for longer commutes – living where the housing is cheaper but driving farther to work in the city. Sometimes, that can even mean living outside Tompkins County. Not only is that lost revenue for the county, Robertson said, but it’s also more expensive for the resident.

“You pay for transportation a little at a time,” Robertson said. “When you add all that up, it’s actually more of an economic burden to live farther away.”

The housing deficit that influences rising housing costs also means that people can end up stuck in their costly homes, unable to move somewhere more affordable simply because there’s nowhere available. Johanna Anderson, executive director of Ithaca Neighborhood Housing Services, explained it best.

“[A] person may be living in a four-bedroom home,” Anderson said. “They don’t need all of those bedrooms, but because there isn’t a smaller home for them to move into that’s acceptable to them and within their price point, they stay in the four-bedroom home, which then means that a family [with] a larger household size, they’re stuck in another home.”

How did we get here?

Because the housing crisis affects so many other areas, it can be hard to understand exactly how it got to be this bad. The simplest answer is an ironic one, as Megan McDonald, deputy commissioner for Tompkins County Department of Planning and Sustainability, explained.

“Some of this is the problem of success,” McDonald said. “We’ve had job growth. We’ve had student enrollment growth and things like that that also put pressures on the housing that we have without having enough new construction to keep up with that.”

As McDonald and others interviewed described, as a city’s economy improves, jobs increase, increasing demand for housing, and communities have struggled to create housing to match that growth.

Recent developments

Many companies, organizations and legislative bodies have been aware of this housing problem for some time, taking steps to try to tackle it in the past couple decades. Among those steps are recent housing development projects, with the one most cited being 210 Hancock.

210 Hancock St., completed in 2017, “transformed an entire city block from two vacant buildings surrounded by a surface parking lot into a vibrant mixed-use community that includes mixed-income rental housing, moderate-income for-purchase housing, an Early Head Start childcare facility and not-for-profit commercial space,” according to the INHS website.

In addition, there have been funding sources and collaborative efforts, like the Community Housing Development Fund, a decade-old collaboration addressing the community’s affordable housing crisis. The partnership, involving the county, the city of Ithaca and Cornell University, has awarded $4.7 million to projects creating 654 units of affordable housing and leveraging approximately $177 million in additional program development funds, according to a November press release.

INHS created a similar program in the early 2010s, Anderson said. The Community Housing Trust was created with the idea that INHS would own land and sell the improvements on the land. Homes on that land are only sold to those who are income eligible, and the homes are only appreciating to account for inflation, so they stay affordable.

Challenges and controversy

Though there has been recent progress to tackle the housing crisis, that progress wasn’t easy. Solving the housing crisis comes with its fair share of challenges, the biggest one being cost.

The 2017 Tompkins County Housing Strategy said current conditions make it extremely difficult to produce new ownership housing for under $200,000.

And construction costs for new housing – regardless of the rent – are about the same, said Heather McDaniel, president of Tompkins County Area Development (TCAD).

“What happens when you reduce the revenue stream … and you still have the same expenses, the projects financially do not pencil out,” McDaniel said.

Basically, it costs about as much to build and maintain an affordable housing development as it does to build and maintain a market-rate one, so asking a developer to set rent lower is asking them to make less return than some can afford.

Affordable housing also comes with more requirements than market-rate housing. For affordable housing, residents have to income qualify, McDaniel said, which requires monitoring for compliance. Nonprofit, affordable housing organizations like INHS have the staffing to do this, but other developers might not.

Anna Kelles, county legislator and chair of the legislature’s Housing and Economic Development Committee, said this explains why most affordable housing projects are done by nonprofits like INHS.

“It is very difficult, if not impossible, to build affordable housing without public assistance,” Kelles said. “So, the affordable housing that is being built is being built by nonprofits or for-profits that are seeking grants, public support and tax abatements.”

This effect is felt by architectural companies hired by for-profit and nonprofit organizations, too. Steve Hugo, principal of Holt Architects, which worked with INHS on 210 Hancock, said depending on how many tax benefits they’re trying to benefit from, Holt can be competing with other organizations for funding.

“One of the issues that that creates is that the developer needs to invest money in architectural design … that needs to, first, compete and then get approval from New York state,” Hugo said. “It’s very possible that we could submit one year and the project won’t get funded.”

TCAD and the Industrial Development Agency (IDA), for which TCAD provides administrative support, have tried to address the challenges for for-profit developers before. Most past plans have been geared toward lessening the cost burden through economic incentives like tax abatements.

But that creates its own set of problems. For one, the amount of taxes that would need to be abated to make up for that lost revenue would be too high, McDaniel said, detrimentally affecting resources throughout the county.

“If the property taxes aren’t being paid, that’s less money to support the schools and the city and the county and all of that,” McDaniel said.

Another large challenge is dealing with community backlash for development projects. Many affordable housing projects face opposition from the members of the community it’s planned for, leading to delays and lost revenue.

McDonald said that part of that opposition is that people who bought their homes many years ago may not realize how tough it is to find a house now.

Kelles added that community members can have concerns about what affordable housing developments might bring with them.

“Sometimes, the resistance is it will bring in a lot of people into a small space, and it will affect the value of my house,” Kelles said. “Some people are open about the fact that they’re uncomfortable with people who are within the affordable income bracket living close to them and their family.”

What it boils down to, sources agree, is that change is hard.

“If you already have housing and are living in a neighborhood in a community and see change coming potentially with new developments, it can be a little scary,” McDonald said.

Strategies and solutions

With all these recent developments and challenges in mind, it’s important to analyze what current strategies are guiding future projects. The biggest driver is, of course, the Tompkins County Housing Strategy.

The county’s housing strategy works within guidelines set by the county’s Comprehensive Plan, which include: 1) Encourage a variety of housing options in development focus areas, 2) support new development of housing affordable to a range of incomes, 3) improve the existing housing stock and other additional guidelines.

Within those guidelines, the housing strategy proposes a three-pronged approach to meeting housing targets, focusing on new housing units, existing housing units and collaboration. New housing units help to provide more places for people to go, improvements to existing housing helps to create affordable housing out of those units, and collaboration helps create the multi-faceted solution needed for this complex problem.

Another key strategy others outlined was an increase in housing choices. For one, increasing housing available at every income level helps to get people out of the homes they’re stuck in – a problem described earlier in this article. In addition, more housing choices means a varied housing market and multi-cultural surrounding community.

Jennifer Tavares, president of the Tompkins County Chamber of Commerce, offered a similar strategy to the county’s, under the categories of funding, policy and advocacy.

Funding strategies include continuing to fund the Community Housing Development Fund, identifying and capitalizing other loan funds, attracting equity investments, expanding incentives for homeownership and landlords and offering effective tax abatement programs. Policy strategies include reducing barriers to development like zoning differences across municipal lines. And advocacy strategies include educating the public on the greater issue of affordable housing.

To address the previously mentioned construction cost issues, Hugo and McDaniel have explored different strategies. Holt projects go through value engineering to try to ensure cost efficiency, Hugo said.

“Being smart and efficient is the best way, so not over-designing … can possibly afford you the ability to still use high-quality materials and be highly sustainable,” Hugo said.

On the IDA side, McDaniel said that, since tax incentives prove costly for the community, the IDA has looked at other options, the most promising being requiring for-profit developers to pay into a fund in lieu of providing affordable housing. The money from this fund would then go on to pay for future affordable housing projects. The benefit to this solution is no lost tax revenue, but McDaniel cautioned even this solution requires balancing a lot of needs.

What all sources agreed on when it comes to effective strategies is that there is no one solution or one organization that can solve this.

“None of us have the single silver bullet to solve this housing crisis,” Anderson said.

Kathy Schlather, executive director of the Human Services Coalition, echoed that sentiment.

“This is a community issue,” she said. “We’re going to have to build more housing. We’re going to have to be creative with people renovating and fixing up housing. We’re going to have to be creative with zoning and regulations that allow for a little more density. … We’re going to keep coming up with different ways to help people find the safe, affordable housing they need.”

Looking to the future

To wrap up this investigation, let’s take a look at what’s in store for affordable housing moving forward.

The Tompkins County Housing Strategy set an overall target for workforce housing development over the next 10 years to 580 units per year, for a total of 5,800 new units through 2025. To get there, organizations like INHS are moving forward with more housing projects.

On Nov. 7, the county Legislature approved a real property tax exemption and payment-in-lieu-of-taxes (PILOT) agreement for the provision of affordable rental housing related to INHS’s Immaculate Conception School redevelopment project, according to a recent press release. 

The project, also known as 320 West Buffalo, will turn what was once the Immaculate Conception School into a mixed-use community, including affordable rental housing serving a range of household sizes and income levels, restoration of the convent building for Catholic Charities’ continued use and space for nonprofit and community-based organizations that serve children and families.

320 West Buffalo includes properties at 320-324 W. Buffalo Street, 330 W. Buffalo and 309 S. Plain Street, which were all granted a 30-year tax exemption from real property taxes levied by Tompkins County, the city of Ithaca and other local taxing authorities, according to the press release.

And that isn’t the only good news spelling progress on the horizon for INHS. In October, New York Attorney General Letitia James announced that INHS was awarded $900,000 grant to support two developments that will result in the creation of 18 new affordable homes, as well as establish working capital revolving funds to be used for land acquisition. Anderson said INHS also plans to use these funds to increase outreach and education.

Increased funding is also coming to the Community Housing Development Fund (CHDF). On Nov. 7, a unanimous vote by the county Legislature augmented the county’s current $100,000 annual commitment to this fund with an additional $100,000 for each of the next two years. 

The Legislature also allocated $300,000 in Program Income Funds to create a new Contingent Fund for the CHDF. This allows the CHDF to endorse more local proposals for low-income housing tax credits, helping more proposals to obtain extra points in New York state and better compete for funding sources.

Cornell University recently committed an added $100,000 to the fund for each of the next two years, a move of which Associate Vice President of Cornell University Community Relations Gary Stewart said the university is quite proud.

“Maintaining and enhancing a steady focus on this important issue among the county’s diverse and shared interests is key,” Stewart said. “We are appreciative of increased or new commitments by local governments, in concert with Cornell’s long-term engagement on this front.”

Conclusion

To conclude this report, it’s important to note that, just as the housing crisis has been building over the years, it’s not going away quickly. As many sources interviewed said, it’s going to be an ongoing problem.

“As long as we have a vibrant economy, we’re going to have housing demand,” Robertson said. “I don’t foresee a day where we’ll go, ‘Well, that’s done.’”

Tavares and others stressed that the county has already seen significant progress in the past few years, but there is still a ways to go.

“There have been hundreds of units built, and there are hundreds still in the pipeline,” Tavares said. “This is an issue that most residents, organizations, and municipal leaders are aware of, and we have significant momentum to accomplish some big things in the next decade.”

If you’d like to help with the housing crisis as a citizen of your community, the best thing you can do, McDonald said, is to be informed, get involved and show your support for affordable housing projects.

“It’s easy to voice negative opinions of projects, but ... when people see something and they think it’s pretty good, it’s hard to motivate [them] to turn out to a public meeting or let an elected official know,” McDonald said. “For everybody to understand when you actually support something is a really important piece.”

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