The Affordability Toolbox
1) Public Funding:
(Either dedicated funds or one-time funds)
• New York City has more than $7.5 billion budgeted as part of a 10-year plan to preserve affordable-housing stock and hired a firm to "develop an ongoing risk assessment" of such residences.
• Fairfax County, Va., levies an additional penny tax per $100 on real estate, which is expected to generate $18 million toward the county's goal of preserving 2,000 affordable apartments by 2011.
• Chicago has an ongoing Rental Subsidy Program.
2) Private Finance Tools:
(Governments and nonprofits providing loans for apartment rehabs)
• Funding initiatives: Washington, D.C.'s Site Acquisition Funding Initiative leverages public funds with private investments, offering below-market-rate loans for development of affordable housing.
• Preservation loan programs also exist in New York, New Jersey, Chicago, Cleveland, Detroit, Massachusetts, and elsewhere.
3) Tax Tools:
• Tax increment financing: A TIF captures taxes generated by new or additional property value into a geographically designated fund, as with Austin's Homestead Preservation District on the Eastside; in Portland, Ore., 30% of all urban-renewal TIFs funding is held for affordable housing; in California, 20% of a TIF fund statewide is directed to low- and moderate-income housing.
• Housing tax credits and tax-abatement programs also have been instituted widely at the city and state level.
4) Zoning/Land-Use Ordinances:
• Condo conversion ordinances: The Community Development Clinic identifies three main components to such ordinances: Developers must cover tenant relocation fees, must offer tenants advance notice of conversion, plus a "right of first refusal" on buying the unit they currently occupy. Cities also can require a limit on the number of conversions yearly, approval by the city, or payment to an affordable-housing fund. Several cities and states (including Seattle, Boston, Los Angeles, San Francisco, and California and Nevada) have some form of a conversion ordinance.
• Affordable-housing-replacement ordinances or housing-impact studies also have been used to preserve affordable rentals.
5) Regulatory Tools:
• Similar to conversion ordinances, these include advance notice to the displaced, the right of first refusal, and relocation reimbursements.
• Boston requires a five-year notice to seniors and low-income renters that their apartments will be converted to condos; Chicago requires a 120-day conversion notice to all renters; Washington, D.C., has codified such measures in their Tenant Opportunity to Purchase Act.
6) Other Tools:
• New York, Los Angeles, Denver, Boston, and other cities have adopted comprehensive city strategies for preserving affordable rentals and apartments; these include offering outreach and assistance to owners and renters, setting a target number of units to preserve, tenant organizing, ongoing assessment of at-risk affordable properties, and stepped-up enforcement of the Fair Housing Act.