[The Affordable Housing Development Incentive Program] 1

The Affordable Housing Development Incentive Program

Joshua Anderson
Salt Lake Community College
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Proposition Justification
Through the implementation of this proposition I hope to bring down housing prices

across the board, better the air quality, relieve traffic congestion in urban areas across the state,

and better the lives of everyday citizens by allowing them more disposable income.

I have heard a lot about the housing crisis on many occasions. It seems to be a hot topic

right now and is being addressed on the radio, television, and several different websites. The

Salt Lake Chamber does a great job of explaining it on their web page devoted to this topic. (SL

Chamber, n.d.).

Long story short, Utah’s population is growing faster than housing is being created.

People are ending up homeless and prices on houses/rentals have sky rocked and continue to rise

at terrifying rates. I initially decided to investigate this whole thing further because I pay rent

and boy is it getting expensive. I also want to be able to own a home someday and if the market

continues in the direction it’s headed, that might not be a possibility. You can find a little more

about the issue at hand in a fantastic Deseret News Article written by Wendy Leonard. (Leonard,

2018)

This proposition is the best solution because it simply gets more housing built in our

communities across Utah without any sort of regulation or restriction, allowing us to keep our

market free. With more housing in the state, demand will decrease which will in turn drop

housing prices for all of us.

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Bill/Resolution Proposed

The Affordable Housing Development Incentive Program

BE IT ENACTED BY THE CONGRESS HERE ASSEMBLED THAT:

SECTION 1.
Utah shall offer incentives to housing developers for the creation of low-income housing in
Utah.

SECTION 2.
 Utah (Location): The boundaries of the state of Utah as defined by the United States
congress.
 Utah (Entity): The offices of the state of Utah and all their branches and/or
departments.
 Housing Developers: Those entities responsible for the purchasing of real estate and
the renovating/building of structures intended for the housing of families and
individuals.
 Low income housing: A dwelling whose monthly rent or mortgage is less than or equal
to 17% of the mean monthly income in the state of Utah.
 Incentives: Reimbursement of 10% of the total cost to develop the housing structure,
pulled from a fund created by the budget surplus of 2018.

SECTION 3.
The Utah Division of Housing and Community Development will oversee the management and
disbursement of grants from the low-income housing development fund. They will also enforce
the proper use of grants and ensure development ensues.
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SECTION 4.
Fund will be created and applications for subsequent grants will be accepted beginning 60 days
following the signing of the legislation to law. Grants will only be allotted to projects completed
after the 60-day mark.

SECTION 5.

All laws in conflict with this legislation are hereby declared null and void.
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Definition of Terms Extended

 Utah (Location): The boundaries of the state of Utah as defined by the United States
congress.

Credibility: According to constitutioncenter.org an enabling act was passed in

1894 by the United States Congress paving a way for Utah to become a state.
President Grover Cleveland proclaimed Utah a state of the Union on January 4th,
1896 officially putting Utah in the books and outlining the boundaries identifying
the state. Those boundaries remain in effect today.

 Utah (Entity): The offices of the state of Utah and all their branches and/or departments.

Credibility: Along with the creation of the state boundaries, a constitution for the
state had to be created. The steps for creating a new state are outlined in Article
IV, Section 3 of the United States Constitution. With that state constitution
created, public office was also implemented to maintain order and peace. Those
public offices constitute the entity that is the State of Utah.

 Housing Developers: Those entities responsible for the purchasing of real estate and the
renovating/building of structures intended for the housing of families and individuals.

Credibility: This one is straight forward. Anyone individual or organization

willing to put up the housing will be considered a developer.

 Low income housing: A dwelling whose monthly rent or mortgage is less than or equal to
30% of the mean monthly income of the lower paid 80% of residents in the state of Utah.

Credibility: The HCV (Housing Choice Voucher) program is a well-known

program that helps people pay for their housing in low income situations.
Program participants pay 30% of the household’s monthly income towards rent,
and the rest is paid to the landlord by the housing authority that manages the
household’s voucher. (AHO, n.d.).

Even though there isn’t a hard and fast rule on 30%, this seemed like a good place
to set the bar because that is simply what has been required in the past from low
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income housing residents. I further decided on the lower paid 80% because if we
include those individuals making 6-digit figures, we drive the mean monthly
income too high.

 Incentives: Reimbursement of 20% of the total cost to develop the housing structure,
pulled from a fund created by the budget surplus of 2018.

Credibility: Google’s dictionary function defines incentive as, “a thing that

motivates or encourages one to do something.” We aim to motivate our
developers to build low income housing by offering a specific reimbursement of
building costs.
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Establishing Clash

Question #1: Is this the best way to spend the surplus?

AFF Evidence:
Yes, this is definitely the largest crisis we have before us as a society. It will affect us
now and will start to drain our economy, when housing is too expensive people don’t want to
move in.

OPP Evidence:
No, there are bigger things out there that are more pressing and require the money. One
example is education, our teachers are paid on average $52,476 a year. That isn't enough, we
could use the surplus to boost that this year to encourage them to stay. (Salary.com, 2019)

Question #2: Will this better the air quality?

AFF Evidence:
Yes this will take countless cars off Utah roads. With more housing around, there will be more
opportunity to live closer to the work place. This means reduced and, in some cases, eliminated
commute times. A typical passenger vehicle emits about 4.6 metric tons of carbon dioxide per
year. I couldn't find out how much GHG was released into the air per household or for a
building. We also can only speculate as to what energy people were using in their other places of
residence or where their residence was before. If people were living a distance away in their own
home, the GHG emission is almost certainly higher than it would be if they lived in a smaller
unit. (EPA, 2018).

OPP Evidence:
The buildings created by this program will put out just as much, if not more pollution than all of
the cars on the road that it would eliminate.

Question #3: Will housing prices drop?

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AFF Evidence:
Yes, they will because the higher supply will bring down the demand for homes and thus the
prices will drop naturally. Because not as many people will be in the home market as there are
homes, the prices will start to compete for buyers by dropping prices. (Hayes, n.d.).

OPP Evidence:
No they won't, people are greedy and no one will drop their prices down from what they are.

Question #4: Will traffic be lighter?

AFF Evidence:
Yes with people living in higher density spaces, they will be closer to where they work and thus
there will be less cars in the road. People will be able to walk or bike or take public transit more
easily.

OPP Evidence:
People don't like to take alternative forms of transportation, they will drive their cars anyway and
traffic will be the same in congested areas.

Question #5: Will the economy receive a boost?

AFF Evidence:
Yes, with lower housing prices, people will be more likely to come to our state to work and more
businesses will have a skilled workforce to use. They will want to get out here too. That will all
grow Utah at an accelerated rate.

OPP evidence:
This project is still small that it won't be able to make any sort of change whatsoever.
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Miscellaneous AFF Evidence:

The cost of creating a garden low income unit is about $116 per square foot. That is about 81k
per average 700sq/ft unit. So, a project of 40 units would require approx. 3.25 million dollars.
Just the fact that it is new construction makes it expensive to rent. (Kimura, n.d.).
If the cost owners require for rent must be in the average $1000 range for a new 1 bed room unit,
this incentive would allow us to drop that rent income by 20% because developers get a 20%
break in building costs, putting your unit down to $800 a unit. As time goes on and the building
loses value and makes its money back prices will drop even lower...in theory...
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Reference List

Adam Hayes (n.d.). Economics basics: supply and demand. Retrieved

from https://www.investopedia.com/university/economics/economics3.asp

Affordable Housing Online (n.d.). Low income housing guides for renters. Retrieved
from https://affordablehousingonline.com/guide

Donna Kimura (n.d.). Developers reveal the cost of doing business. Retrieved from
https://www.housingfinance.com/news/developers-reveal-the-costs-of-doingbusiness_o

EPA (May 2018.). Greenhouse gas emissions from a typical passenger vehicle. Retrieved
from https://www.epa.gov/greenvehicles/greenhouse-gas-emissions-typical-passenger-vehicle

Holly Muson (Jan.2013.). Utah’s very interesting path to statehood. Retrieved from
https://constitutioncenter.org/blog/utahs-very-interesting-path-to-statehood

KSL News (n.d.). Commute times average in Salt Lake. Retrieved from
https://www.ksl.com/article/13677477/commute-times-average-in-salt-lake?print=1

Lucinda Dillon Deseret News (Jan. 2000.). Affordable housing.Retrieved from

https://www.deseretnews.com/article/737364/Affordable-housing.html

Salary.com (Feb 2019.) Salary for public school teacher in Utah. Retrieved
from https://www1.salary.com/UT/Public-School-Teacher-Salary.html

The Salt Lake Chamber (n.d.). Housing gap coalition, more people. fewer houses.
Retrieved from
https://slchamber.com/housinggapcoalition/?utm_source=Search&utm_medium=CPC&utm_cam
paign=2019HousingGap&gclid=CjwKCAiA767jBRBqEiwAGdAOr6NbP4m_m1Qi612xxo_Osf
78Ql46LgjyUZ9S3tbcXaeZRQoaJvcsxRoCH64QAvD_BwE
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Wendy Leonard, (Aug.2018.). Utah has a housing crisis in a lack of affordable homes.
Retrieved from https://www.deseretnews.com/article/900029413/utah-has-a-housing-crisis-in-a-
lack-of-affordable-homes.html