Monday, June 19, 2017
The city is gearing up to revise a longstanding local rule requiring the one-for-one replacement of demolished public housing units.
Resolution 830, a 1981 city ordinance, requires replacement of demolished public housing units with an “equal number” of “substantially equivalent” new units. The resolution obliges both the city government and the Alexandria Redevelopment and Housing Authority (ARHA) — the entity that administers HUD subsidies locally — to play a role. However, their interpretations of these provisions have diverged over the years as the underlying regulatory and funding environment has changed. The city is spearheading an effort to consider, between July and December, how to clarify the ordinance. The modernization effort will occur in the midst of ARHA’s redevelopment, currently underway or slated, of six of its properties.
At a June 6 work session, the parties discussed their current positions and how best to proceed.
City officials and staff tend to think of one-for-one replacement in terms of affordability at given income levels, said Vice Mayor Justin Wilson. ARHA has historically served households in the lowest range of income: what work session participants referred to as the demographic slice making 20-30 percent of the area median income (AMI). For example, 86 percent of Andrew Adkins households make less than $40,000 — roughly 35 percent of AMI. The city’s general interpretation would have ARHA redevelop its properties at the same low price points: “30 percent [of AMI] with 30 percent [of AMI],” said Wilson.
By comparison, he said that ARHA thinks of 830’s provisions more in terms of the number of units than of hard-and-fast levels of affordability. This view permits ARHA to redevelop units with higher rents, which its leadership says are necessary to ensure sustainable operation.
“The current combination of revenues that come from rent and … the operating subsidy from HUD is not sufficient to carry the expense related to the operation of public housing,” said ARHA CEO Roy Priest. Even taking HUD operating subsidies into account, 769 ARHA units operate at a net deficit of nearly $602,000, according to data presented at an Alexandria Housing Affordability Advisory Committee (AHAAC) meeting last December. Higher rent units, as well as selling off land for private market rate development, help ARHA make up the gap and cover the cost of its lower-rent units.
“Simply put, we need to serve the 60 percent [of AMI] for the sake of the 30 percent [of AMI],” said Daniel Bauman, chair of ARHA’s Board of Commissioners.
“The reason we sort of wanted to daylight this is so that we could all understand that we’re going to have to make choices as the properties redevelop,” said Helen McIlvaine of the city’s Office of Housing. “If, when you talk about a Resolution 830 unit, you mean a 20 percent [of AMI] unit, you are not going to be getting those back one-to-one. You’re going to get a 20 percent [of AMI] unit, and maybe three 60 percent [of AMI] units, and an 80 or 100 percent [of AMI] unit.”
Mayor Allison Silberberg expressed concern that this shift represents a retreat from ARHA’s mission to serve the city’s most vulnerable residents. But ARHA leadership disagreed.
“We have not moved away from our mission … We’re just simply showing you that from the standpoint of redeveloping that inventory, you’ve got to have a broader spread of revenues if you’re going to sustain them without deep subsidies,” said Priest.
For this reason, Bauman has previously expressed concern that a too-restrictive rewrite of 830, in terms of affordability requirements, could in fact imperil ARHA’s mission.
Displaced residents receive a “tenant protection voucher” from HUD. Residents could use these vouchers to cover the gap between their old and new rents, allowing them to return to the same redeveloped property if they wish.
“So we are not ending our service to that most vulnerable resident; it’s just [that] they have a different form of subsidy,” said Priest.
However, “the tenant protection voucher is specific to that tenant,” said McIlvaine. “So … someone who is currently living at Adkins [for example] who gets that voucher can come back and live in a unit that may be affordable at something above 20 or 30 percent [of AMI]. But when that household takes its voucher and leaves, the unit will be affordable at whatever that [new] income level is.”
The current proposal for the Adkins redevelopment has all returning units priced at 60 percent of AMI, said Councilman John Taylor Chapman.
“Sort of on a macro level … will the number of people at that [20-30 percent of AMI] level of income necessarily reduce?” Silberberg asked. “That’s my overall concern.”
“It’s going to be hard for them to find housing in this city using the voucher,” said McIlvaine. “It will potentially reduce the number of households that are able to live in our city.”
“We have to separate facts from conjecture,” said Bauman. “Conjecture is that our people may not be able to find housing in the city. But possibly they will. … The fact is that what we have right now with 830 exists and our intent is to continue to serve that need one-for-one. Another fact is that we are in a challenging financing environment for any new product that we build, and it creates a need to look at things a little differently.”
At the end of the day, it’s a question of relative values.
“The amount of affordability is depleting. … There’s either a subsidy that’s kicked in to make that not happen, or these projects don’t happen to begin with,” said Wilson. “We could abandon this process. But we have to do so with the understanding that either that’s OK, or, if that’s not OK, we — someone — needs to show up with a lot of money … or another way of doing this. So I think that’s the fundamental question.”