Atlanta City Council

Community Development Human Resource Committee

Affordable Housing Work Session
July 22, 2014
1
Presenters
Dawn J. Luke
Managing Director, Housing Finance
Invest Atlanta
Terri M. Lee
Deputy Commissioner
Department of Planning and
Community Development
Derrick Jordan
Interim Director, Office of Housing
Department of Planning and
Community Development
H. Granvel Tate
Principal
1025 Advisors, Inc.
2
Agenda
Why we are here: Current realities, community concerns and market
conditions
p. 4
State of the City of Atlantas Housing Market p. 8
Overview of Affordable Housing p. 15
Where Does Affordable Housing Exist within the City of Atlanta? p. 19
Who Creates Affordable Housing in the City of Atlanta? p. 23
City of Atlantas Approach in Addressing the Affordable Housing
Need
p. 27
Citywide Housing Strategy p. 32
The Call to Action p. 37
3
Why we are here: Current realities, community
concerns, and market conditions
4
What does the data say: Atlantas housing market and its citizens have faced the
Great Recession & foreclosure crisis, while powerful demographic forces have
played out.
The number of Atlanta residents who spend more than 30% of their income on
housing has increased significantly since 2000.
The lowest cost housing is concentrated in the places with the fewest jobs.
Over the last twenty years, housing prices have grown faster than incomes.
The Citys residential vacancy rate remains high, despite recent improvements in home
construction.
The Citys population growth has slowed while its share of the regions population has
declined.
The majority of Atlantas housing units are more than 30 years old.
5
What does the community say: Residents and business stakeholders expressed
common themes about priorities and key issues for the housing market.
Priorities
Residents:
Address issues that impact quality of life alongside housing
Support more multi-family high-rise housing
Address blight
Provide housing for all age groups, especially young families and elderly
Business Stakeholders:
Interagency Coordination / Strategic alignment with APS
Mixed income models (Hope VI)
Key Issues
Residents:
More housing options for young families and desiring a balance of ownership and rental
Connectivity among the housing, economic development, and educational strategies
Inclusion of other neighborhood infrastructure (sidewalks, bike paths, etc.)
Continued community representation in the strategy process and implementation
Business Stakeholders
Limited resources / Permanence of affordability
Concentrations of poverty / Location of jobs
6
Policies and resources needed to meet the existing housing challenges.
Funding Needed to Implement the Housing Strategy
New issuance of the successful Housing Opportunity Bonds
Funding to increase LBA capacity to acquire and rehabilitate vacant, blighted
properties
Creation of Housing Trust Fund from a variety of sources (payment in lieu of, dedicated
millage, per unit levy)
Policies for Implementing the Housing Strategy
Changes to TAD Policies to require developers to create workforce housing
Priority tax lien purchase for the LBA
Tax incentives for affordable housing development
New zoning incentives and requirements based on proven models in other cities
Inclusionary Housing policy that requires all new residential developments to have
affordable/workforce housing component
7
State of the City of Atlantas Housing Market
8
Overview of the City of Atlantas Demographics
Source: 2007-2011 ACS
Total Population: +400,000
# of Cost Burden Residents: ~75,000
Median Household Income: $46,000
Median Home Value: $228,000
Median Rent: $910
Population living in poverty: 23%
# of Housing Units: 225,000
Residential Vacancy Rate: 20%
Structures 30 years or older: 61%
9
More than 30% of Atlanta households earn less than $25,000 a year.
15%
18%
23%
16%
10%
11%
14%
0%
5%
10%
15%
20%
25%
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
< $10,000 $10,000 -
$24,999
$25,000 -
$49,999
$50,000 -
$74,999
$75,000 -
$99,999
$100,000 -
$149,999
> $150,000
P
e
r
c
e
n
t

o
f

H
o
u
s
e
h
o
l
d
s
N
u
m
b
e
r

o
f

H
o
u
s
e
h
o
l
d
s

Income Brackets
Source: U.S. Census (2011 5-YR ACS)
Household Income Distribution
10
33% of households
earn < $25k
The number of cost burdened residents has increased.
Source: 2000 Census vs. 2011 5-yr ACS
17,495
37,994
23,507
49,762
0
10,000
20,000
30,000
40,000
50,000
60,000
Cost Burdened Owners Cost Burdened Renters
2000 2011
Atlanta residents who spend more than 30% of their income on housing
(2000 vs. 2011)
Source: 2000 Census vs. 2011 5-yr ACS
29%
41%
40%
54%
11
Overview of the City of Atlantas Neighborhoods
160,207 total parcels
143,888 Residential parcels
242 neighborhoods
98% of Residential Parcels
are Single Family (1-2 units)
17,638 Vacant Structures and
Lots (11% of total)
3,850 blighted structures
(poor/deteriorated) (2.4% of
total)
12
Percentage of Residential and Vacant Parcels in the City
of Atlanta By Council District
TOP 3 COUNCIL DISTRICTS
% OF RESIDENTIAL PARCELS:
1. CD-3 (18%)
2. CD-6 (16%)
3. CD-5 (15%)
% OF VACANT PARCELS*:
1. CD-3 (25%)
2. CD-12 (21%)
3. CD-4 (20%)
Source: SCI Report: APD Solutions, 2013
*Includes Vacant Lots and Structures
CD-1 CD-2 CD-3 CD-4 CD-5 CD-6 CD-7 CD-8 CD-9 CD-10 CD-11 CD-12
% of Residential Parcels 12 13 18 12 15 16 10 9 11 10 9 12
% of Vacant Parcels 16 4 25 20 8 3 1 3 19 13 11 21
0
5
10
15
20
25
30
13
City of Atlanta Neighborhood Investment Typology
3%
12%
17%
16%
18%
19%
13%
2%
Exceptional
Strong
Stable
Trending
Transitional
Vulnerable
Declining
Fragile
32%
34%
Source: SCI Report: APD Solutions, 2013
14
Overview of Affordable Housing
15
There is a growing divide between market and affordable rates
especially for families.
Area Median
Income % STUDIO
1
BEDROOMS
2
BEDROOMS
3
BEDROOMS
50% $ 563 $ 604 $ 725 $ 837
60% $ 676 $ 725 $ 870 $ 1,005
80% $ 901 $ 965 $ 1,158 $ 1,339
MARKET* $ 955 $ 1,029 $ 1,470 $ 1,985
New Old 4
th
Ward Units**
$1,130 $ 1,240 $ 1,890 $ 2,455
16
*Market units are based on an average rate of $1.47psf.
**Prices in Old 4
th
Ward reflect lowest priced market unit in Bohemian House and 755 North Avenue.
Affordable Workforce Housing Policy, which is based on family size, has to include
working families who are at the high end of the % of Area Median Income but cannot
afford to buy houses in many parts of the city.
$44,000 $75,000 $65,000
$132,000 $225,000 $195,000
100% 140% 140%
$228,000 Median Home Value in Atlanta
Total Household Income
Maximum Home Price
They Can Afford
% of Area Median
Income
17
Affordable Housing Income Limits for the Atlanta MSA.
2014 INCOME
LIMIT
1
PERSON
2
PERSONS
3
PERSONS
4
PERSONS
5
PERSONS
30% $ 13,550 $ 15,450 $ 17,400 $ 19,300 $ 20,850
50% $ 22,550 $ 25,800 $ 29,000 $ 32,200 $ 34,800
60% $ 27,060 $ 30,960 $ 34,800 $ 38,640 $ 41,760
80% $ 36,050 $ 41,200 $ 46,350 $ 51,500 $ 55,650
100% $ 45,100 $ 51,600 $ 58,000 $ 64,400 $ 69,600
115% $ 53,400 $ 61,000 $ 68,650 $ 76,250 $ 80,000
120% $ 55,700 $ 63,650 $ 71,600 $ 79,550 $ 83,500
140% $ 63,100 $ 72,100 $ 81,100 $ 90,100 $ 97,300
H
O
M
E
O
W
N
E
R
S
H
I
P
R
E
N
T
A
L
18
Where Does Affordable Housing Exist within
the City of Atlanta?
19
Subsidized housing is clustered near the City center and the west.
HUD-Subsidized, HUD-
Insured, HUD-Operated,
and LIHTC properties
Source; Policy Map, U.S. Department of Housing
and Urban Developments LIHTC Database, which
was last revised as of August 17, 2012.
20
Households with vouchers are concentrated in southern neighborhoods.
Percent of Households
receiving Section 8
Vouchers as of 2009 by
Census Tract
Source; Policy Map, U.S. Department of Housing
and Urban Developments LIHTC Database, which
was last revised as of August 17, 2012.
21
Areas of Atlanta with the most jobs have the least affordable housing.
Source: Policy Map, 2011 5-yr ACS
Jobs per tract
Map of Atlantas Employment, 2010
Source: Atlanta Regional Commission
Share of Homes Affordable to Families
Earning below 80% AMI
22
Who Creates Affordable Housing in the
City of Atlanta?
23
A number of different entities play an important role in creating
Atlantas housing landscape.
City of Atlantas Housing
Agencies
City of Atlanta: Office of
Housing
Distributes funding for housing
development & preservation
Invest Atlanta
Provides financing for affordable
housing development &
homeownership
Atlanta Housing Authority
Acquires, manages and develops
affordable housing
Public Sector
Georgia Department of
Community Affairs
Distributes Low-Income Housing Tax
Credits and offers down payment
assistance
United States Department of
Housing & Urban Development
Administers federal aid to local housing
agencies that manage and finance
housing for low income families
MARTA and Atlanta Beltline, Inc.
Make land available for development
City of Atlanta / Fulton County
Land Bank Authority
Banks land for future development
Private/Non-Profit
Enterprise Community Partners
Provides capacity building for non-profits,
funding for workforce housing and
consulting services
Foundations/Banks
Provides funding for workforce
development and/or place-based
neighborhood revitalization
Neighborworks
Provides capacity building for non-profits,
funding for workforce housing and
consulting services
CDCs/CHDO
Acquires, owns, operates, and develop
neighborhood based workforce housing
projects
Developers
Acquires, owns, manages and develops
workforce housing
24
These funding streams run through many different entities.
Housing Opportunity Bonds
Tax Exempt Bonds
Down Payment Assistance
Vine City Trust Fund
BeltLine Affordable Housing Trust Fund
HOME Funds
Community Development
Block Grants (CDBG)
Neighborhood Stabilization
Program (NSP)
CITY OF ATLANTA
OFFICE OF HOUSING
INVEST ATLANTA
Hope VI
Section 8 / PBRA
Choice Neighborhoods Planning
Grant
Down Payment Assistance
ATLANTA HOUSING
AUTHORITY
Low-Income Housing Tax Credits
State HOME Funds
Down Payment Assistance
1
st
Mortgage Program
HOME Safe Program
GEORGIA DEPARTMENT OF
COMMUNITY AFFAIRS
25
26
While many of Atlantas primary housing resources have been effective, they
are now largely depleted.
Invest Atlanta Tools
Tax Exempt Bonds
Housing Opportunity Bonds
HOME Investment Partnership
BeltLine Affordable Housing Trust Fund
Homelessness Opportunity Fund
Lease Purchase Bonds
Economic Realities
Conventional taxable rates have been
lower than Tax Exempt Bond Rates
93% Expended; $40mm remains to be
issued. Requires Council approval
Federal funding decreased by 40%
since 2010
100% Allocated
99.9% Expended
Some success in providing workforce
housing choice in higher cost areas
26
City of Atlantas Approach in Addressing the
Need for Affordable Housing
27
In recent years, Atlanta has enacted several initiatives to make housing
more affordable for residents.
Established the Atlanta BeltLine
Affordable Housing Trust Fund
Established the Homeless Opportunity
Fund
Used Tax Allocation Districts to
facilitate the development of mixed
income communities
Used Lease Purchase Bonds to create
housing choices in high cost areas
Redeveloped public housing as mixed
income communities
Established a Housing Opportunity
Bond Fund
Successful Development Funded to Date
Novare Skyhouse Lofts at
Reynoldstown Crossing
Adamsville Green Senior
Apts.
West Highlands Master-
Planned Community
28
Four entities played roles in the creation of the Housing Opportunity
Bond Fund (HOB).
Guaranteed payment of debt service
from City revenue
Used Housing Authorities Law to
create non-profit AHOI
Issued the Bonds
Implementation Agent for the
programs outlined in the HOB
documents
Atlanta Housing Opportunity Inc.
(AHOI)
Designated Housing Corporation and
Borrower of Funds
Housing
Opportunity Bond
(HOB)
29
HOB has produced more than 2,000 housing units and been leveraged
by private funds >7:1.
Components Revised Budget Funds Expended Funds Leveraged
Units
Produced
Down Payment Assistance for workforce
homeownership
$13,446,446 $13,446,446 $104,656,008 777
Loans for acquisition and rehabilitation/new
construction of multifamily rental units
$4,200,000 $4,200,000 $89,600,807 802
AHA Hope VI Infrastructure Funds for Collegetown
at Harris Homes Redevelopment
$7,500,000 $7,500,000 $44,010,000 489
Land Assemblage Financing Fund for
predevelopment/acquisition cost
$1,800,000 $1,800,000 $21,500,000 --
Direct Land Acquisition to fund City of Atlantas
property acquisitions
$1,000,000 $3,000 -- --
Community Housing Dev. Organization Loans to
create rental and for-sale units
$810,115 $246,438 $283,403 4
ProgramAdministration $5,589,200 $5,589,200 NA NA
Bond Costs of Issuance $708,015 $708,015 NA NA
Totals $35,053,776 $33,493,099 $260,050,218 2,068
DRAFT - July 18, 2014 30
777 homebuyers used HOB down payment assistance to make Atlanta
their new home.
Component Value
Closed Loans New Construction 231
Closed Loans Existing Homes 546
Opportunity Funds Expended $13,446,446
Private Investment Leveraged $104,656,008
Average Family Income $46,605
Average Family Size 1.5
Average Sales Price $147,998
31
Citywide Housing Strategy
32
Community Engagement: Community meetings were held in various
quadrants of the City to gather residents feedback.
SCI Group 1: South Atlanta
11/12/13 Adamsville Recreation Center 6 8 pm
*Housing Strategy Group 1: Council Districts 3, 9, 10
11/13/13 Adamsville Recreation Center 6 8 pm
*Housing Strategy Group 2: Council Districts 1, 2, 5
11/14/13 The Trolley Barn 6 8 pm
*Housing Strategy Group 3: Council Districts 6, 7, 8
11/19/13 Peachtree Christian Church 6 8 pm
SCI Group 2: North Atlanta
11/20/13 Atlanta Speech School 6 8 pm
*Housing Strategy Group 4: Council Districts 4, 11, 12
11/21/13 Atlanta Technical College 6 8 pm
* Coordination: Invest Atlanta and Enterprise Community Partners
* Polling and Meeting Assistance: Atlanta Regional Commission
33
Our consultants talked to numerous community members and
stakeholders to assist in informing the Housing Strategy.
34
The following existing tools, new tools and tactics can best help Atlanta
achieve its housing goals.
Existing Policy Tools to be Enhanced Description
The Housing Opportunity Bond Fund Funds the development and preservation of workforce housing
Tax Allocation Districts Contributes local tax revenues to local projects
The FC/CoA Land Bank Acquires and holds blighted property for redevelopment
The Zoning Code Facilitates more dense development around key urban amenities
New Policy Tools to be Created Description
Inclusionary Zoning Would link workforce housing development with market rate development
Expanded Tax Abatements Would provide a long-term operating subsidy to fill the gap left by affordable units
New Tactics for Housing/Vacant Properties New Tactics for Neighborhoods & Community Development
Targeted Workforce Housing Initiative Neighborhood Agenda at the State Legislature
Vacant Property Registration System & Database Concentration of Housing Dollars and Code Enforcement
Vacant Property Receivership/ Conservatorship Synergize Community and Economic Development
For-profit and Non-profit Developer Collaboration Enhance Neighborhood Gateways
Promote Purchase Rehab Lending Improve Pedestrian Mobility
Implement the Use of a Smart Rehab Code Collaboration with Public and Private Utilities
Enlist and Train Realtors, Builders, and Developers Community Engagement
35
Housing Strategy Metrics: Specific milestones that mark success in
achieving the Goals.
Grow Atlantas population by 10 percent (42,000) by 2020.
Reduce the number of Atlanta low- and moderate-income households paying more
than 30 percent of their income for housing by 10 percent (7,500) by 2020.
Reduce the number of vacant, blighted homes by 10 percent (800) by 2020.
Produce or rehabilitate 10,000 residential units for a range of incomes, doubling the
current rate of production, in redeveloping communities job-rich areas by 2020.
Generate $100 million in new funding to support part of the costs of these units by
2020, with the first $40 million issued by the end of 2014.
Ensure that at least 10,000 new and rehabilitated units meet nationally recognized
sustainability and energy efficient criteria by 2020.
*
* Range of incomes is defined as between 80% and 120% of area median income.
36
The Call to Action
37
Absent of adequate financial resources, IA and the City have taken
several steps to begin implementation of the Housing Strategy.
Changes have been made to TAD policies to include a workforce housing requirement
COA has applied and received a technical assistance scholarship from Center for
Community Progress to evaluate current policy and procedures to address blighted
properties
IA working with Office of Planning to enhance Density Bonus ordinance
IA working with LBA to acquire tax delinquent multifamily property
COA is working with a local developer and non-profit to complete a place based
strategy to address vacant land and blighted properties in the Mechanicsville
neighborhood and Pittsburgh
COA & IA have participated in two (2) workshops conducted by Enterprise focused on
Transit Oriented Development (TOD) and Inclusionary Housing
IA is working on strategy to strengthen the use of Lease Purchase bonds to incentivize
affordable workforce housing
IA is developing a rezoning proposal to be submitted to the Office of Planning and
considered as part of the evaluation and rewrite of the current zoning ordinance
38
Additional policies and potential resources needed to implement the
Housing Strategy.
Funding Needed to Implement the Housing Strategy
New issuance of the successful Housing Opportunity Bonds
Funding to increase LBA capacity to acquire and rehabilitate vacant, blighted
properties
Creation of Housing Trust Fund from a variety of sources (payment in lieu of, dedicated
millage, per unit levy)
Policies for Implementing the Housing Strategy
Changes to TAD Policies to require developers to create workforce housing
Priority tax lien purchase for the LBA
Tax incentives for affordable housing development
New zoning incentives and requirements based on proven models in other cities
Inclusionary Housing policy that requires all new residential developments to have
affordable/workforce housing component
39
40
Thank you!
For more information, please
contact us at:
Dawn J. Luke Terri M. Lee
(404) 614-8289 (404) 330-6643
dluke@investatlanta.com telee@atlantaga.gov
Granvel Tate Derrick Jordan
(404) 490-1025 (404) 330-6439
gtate@1025advisors.com dajordan@atlantaga.gov