AFFORDABLE HOUSING 101
6:05 am
Fri May 24, 2013

Under One Roof: Where Is the Public and Political Will for Affordable Housing?

For many, Election Night 2012 was a great night.

At the Driskill Hotel, Travis County Democrats toasted President Obama’s victory. But Walter Moreau with Foundation Communities, one of Austin’s largest affordable-housing providers, wasn’t celebrating.

“All the other bonds passed, so it’s hard to say why …” Moreau began.

Austin voters had been asked to approve seven bond propositions, totaling $385 million. Voters ended up approving most of the package. Except for Prop 15, which was nearly $80 million in bonds for affordable housing.

“That’s really home repair for seniors, that’s housing for folks that are homeless, that’s programs for veterans and disabled and people that are really vulnerable in our community that need help,” Moreau said.

Fast forward about five months. David Butts, a veteran Austin politico, has had a hand in helping elect every current member of the Austin City Council. He also helped head up the campaign for Prop 15.

He’s had plenty of time to dissect what went wrong: He starts with the ballot language itself, which said nothing about affordable housing.

“It was extremely abbreviated, by even comparison to the others,” Butts said.

Another problem was a lack of resources -- cash -- poured into the campaign. “Our own polling showed it losing,” he said. “And that was conveyed to people, but the money that was necessary to communicate to voters didn’t come until very late.” (Click here for a map showing how Prop 15 lost.)

But the Prop 15 campaign failed in an even more basic way, Butts says: communicating affordable housing’s benefits to voters, or, maybe even more fundamentally, what affordable housing is.

“There’s a lot of connotations in people’s minds about, ‘What does that mean?’” Butts said. “Now, some people think it means Soviet-style architecture, or something like ‘We’ll have thousands of people living right next door to you in these gigantic complexes.’ Well, that’s not what we’re doing.”

Regardless of the reason for Prop 15’s defeat, it blew a hole in Austin’s affordable-housing plans. And the scramble for funding in the wake of its defeat also raised a question: Is the city leaving money on the table?

Let’s say you’re a developer, looking to build more densely than zoning allows on a piece of land downtown.

For years, you’ve had two options: You can apply for central urban redevelopment, or CURE, zoning. That’s a category for projects that supposedly rise to a special standard.  But it doesn’t require developers to include affordable housing.

Your other option is to apply for that extra density under the Downtown Density Bonus Program. But you’d be required to include affordable housing. (Here's a list of city zoning types.)

To date, downtown developers have used CURE zoning every time. The Downtown Density Bonus Program hasn’t been used once.

“That’s just not right,” said City Council member Laura Morrison. She has lead the push to phase out CURE zoning.

“The loss of the bonds -- it puts a laser focus on this responsibility, that we do everything we can to make sure that we’re leveraging and ensuring as much affordability in this town as we can,” Morrison said. “That’s our job as council.”

Elizabeth Mueller, who was on the affordable housing task force that created the downtown density bonus program, sees it as “a matter of political will.”

Mueller says the zoning debate may obscure a more fundamental issue: Most of the time, the most affordable housing is the stuff that’s already built.  

She points to the city’s rezoning of East Riverside as an example. (She co-authored an award-winning report studying East Riverside.) It’s great in theory: in line with the Imagine Austin Comprehensive Plan, it even includes some affordable housing.

“And that will also increase the tax base for the city, so the city has an interest in that because they’ll get more property tax revenue,” she said. “And developers will also get more return on their investments there. So those two things are aligned.”

But there’s a downside. “Those things then, also, are raising the value of properties in ways that can raise rents, other things that make it harder then to serve those goals of maintaining them as affordable to existing residents,” Mueller said.

The council recently passed a resolution from Morrison incorporating some of Mueller’s ideas, such as offering incentives to keep older, existing buildings affordable.

“We’re losing more and more on the ground,” Morrison said. “Because old buildings that provide affordable housing get knocked down, and existing buildings that might provide affordable housing are just getting more expensive.”

Preserving existing affordable units could increase housing options. Other ideas include creating a homestead preservation district. There, property taxes from new developments would offset taxes for longtime residents in danger of being pushed out. Another idea is to use the city-owned land more aggressively: Open more city land to developers and require them to build at deep affordability levels.

Any of these initiatives could reduce reliance on future bond funding for affordable housing. But Moreau of Foundation Communities says it will still require voter-approved cash.

“I think we can do a lot through the land development code, through zoning, through density bonuses, through other policy-oriented things,” he said. “But we also are going to have to come up with capital funding, especially to serve the lowest-income folks. Otherwise, they’ll  be priced out of Austin, and I think that hurts us a community.”

To that end, a group of affordable-housing advocates is calling for another go at a bond election. The City Council could vote later this summer to put a question on the November ballot.

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