AUSTINS STRATEGIES TO PROMOTE AFFORDABILITY 1 DEFINITIONS: - - PowerPoint PPT Presentation

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AUSTIN’S STRATEGIES TO PROMOTE AFFORDABILITY

DEFINITIONS: AFFORDABILITY

Household Affordability (Imagine Austin Priority Program #6): Household affordability includes the cost of housing, utilities, taxes and transportation. Definition from Imagine Austin Affordable Housing: Housing in which the occupant(s) is/are paying no more than 30 percent of his or her income for rent, mortgage payments and

• utilities. Definition from HUD

Median Family Income (MFI):

30% MFI: $16,350 for 1-person household; $23.350 for a 4-person household 50% MFI: $27,250 for 1-person household; $38,900 for a 4-person household 80% MFI: $43,600 for 1-person household; $62,250 for a 4-person household 2016 HUD Values for the Austin-Round Rock-San Marcos MSA

Affordability through Regulations or Incentives Housing Subsidized by Federal

• r Local funds to make the

development feasible with lower rents or prices. Usually has an affordability period. Market Rate Affordable Housing: Housing built by private developers that is affordable due to size, location, age, quality, maintenance, etc… Subsidized Affordable Housing Housing Subsidized by Federal

• r Local funds to make the

development feasible with lower rents or prices. Usually has an affordability period. Income-Restricted Affordable Housing: Housing that is reserved for households at particular incomes (often in terms of a percentage of Median Family Income, or MFI) for a specified period of time.

ACHIEVING AFFORDABLE HOUSING

HOMESTEAD PRESERVATION DISTRICT

Current Homestead Preservation Districts: Four Created in East Austin to: “increase home ownership, provide affordable housing, prevent the involuntary loss of homesteads by existing low-income and moderate income homeowners living in disadvantaged neighborhoods.”

POTENTIAL FUTURE HOMESTEAD PRESERVATION DISTRICTS

Homestead Preservation Reinvestment Zone: Allows the use of tax increment financing (TIF) to finance the creation and preservation of affordable housing in the district. – Created for

• ne of the four established HPDs in Austin in December of 2015.

Homestead Land Bank Program: Allows the City of Austin to operate a Land Bank program, through which vacant properties subject to tax foreclosure are made available for affordable housing. Homestead Land Trust: Allows Council to designate one or more community land trusts to

• perate within the district and access TIF funds. Austin Housing

Finance Corporation, Travis County Housing Finance Corporation and PeopleTrust are designated by City Council to operate as HPD Land Trusts.

HOMESTEAD PRESERVATION DISTRICTS

COMMUNITY LAND TRUST PROGRAM

• Allows low- and moderate-income people to

purchase a home and lease the land

• Takes the cost of the land out of the real

estate transaction

• More affordable than houses on the open real

estate market

• 99-year ground lease with the CLT is signed for

the use of the land

Density Bonus Programs

Baseline Density (e.g., 8:1 FAR)

Entitlements can include:

• Additional Density (FAR: Floor Area

Ratio)

• Additional Units per Acre
• Additional Height

An incentive-based tool that grants additional entitlements (density) in return for positive community benefits. What is a Density Bonus Program?

Designed to leverage private sector partnerships Generally targeting 60% Median Family Income and above.

DENSITY BONUS PROGRAM

Incentive-based program that grants additional entitlements or privileges in return for community benefits (Density is a community benefit)

Strengths:

• Provide options for developer

participation

• Sensitive to neighborhood context

Challenges

• Limited standardization makes

implementation difficult for developers and City staff

• Fee-in-lieu structure does

not often reflect real cost of development

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Home Repair and Financial Empowerment Programs

Financial Empowerment:

 Down Payment Assistance  HousingSmarts Home Buyer Education  Individual Development Account (IDA) Program

Home Repair:

 Lead Healthy Homes Grant  Architectural Barrier Removal (ABR)  Home Repair Loan

HousingSmarts Program

• FREE homebuyer education training
• Teaches first-time home buyers and others how to manage

and improve their credit and finances, obtain a mortgage, shop for a home, and protect their investment

• A HousingSmarts graduation certificate satisfies many

homebuyer education training requirements

• Eligibility
• Live within Austin city limits
• At or below 80% Median Family Income
• All City employees are eligible

Down Payment Assistance (DPA)

• Assistance with down payment, eligible closing costs and pre-

paid expenses depending on financial need

• Standard DPA: $1,000 to $14,999
• Deferred, 0% interest loan, 5 year term
• Shared Equity DPA: $15,000 to $40,000
• Deferred, 0% interest loan
• 10 year note, 30 year lien and shared equity

Individual Development Account (IDA)

• Provides matched funds and classes to assist

with:

• Higher Education
• Purchasing a home
• Investing in a small business endeavor
• 4:1 Matched Funds - City will match $4 for every $1
• Max Savings = $1000 and Max Match = $4000
• Double for eligible households
• Required education focusing on specific goal

Lead Healthy Homes Offers

• Houses built before 1978 may contain lead, which has been

found to have especially negative effects on children

• Lead HH offers up to $30,000 in FREE services
• Lead poisoning testing for children
• Home inspections for lead
• Lead removal
• Risk Assessments
• Lead Abatement
• Relocation of occupants
• Removal and storage of contents

Before After

Architectural Barrier Removal (ABR)

• Up to $15,000 grant to modify or retrofit the homes of elderly

and/or severely disabled homeowners and renters to increase self-sufficiency, mobility, and safety

• Handrails
• Door widening
• Buzzing or flashing devices (for persons with impaired

hearing or vision)

• Accessible door handles or faucet handles
• Shower grab bars
• Shower wands
• Elevated toilets
• Accessible sinks and showers

ABR Before and Aft fter

OTH THER POTE TENTIAL STR TRATEGIES FOR AFFORDABILITY

• Support Legislation to Allow a Flat Dollar-Amount Homestead

Exemption for all Local Taxing Entities

• Use Incentives to Support the Production of Jobs for Lower-

Income Residents

• Target a Preservation Property Tax Exemption to Communities at

Risk of Displacement

• Allow Homeowners to Rent Part of Their Houses
• Pursue Future General Obligation Bond Elections for Affordable

Housing

• Challenge the Private Sector to Participate in a Fund for

Affordable and/or Workforce Housing

• Encourage Missing Middle Housing
• Allow Development of Smaller Houses on Smaller Lots
• Relax regulations on both internal and external Accessory

Dwelling Units (ADUs)

• Maximize Public Property to Build or Include Affordable

Housing

• Utilize Tax Increment Financing (TIFs) for Affordable Housing
• Utilize Social Impact Bonds/Pay for Success Models for

Services for People Experiencing Homelessness

• Utilize the National Housing Trust Fund
• Leverage Low Income Housing Tax Credits (LIHTC) and Seek

Legislative Changes for the City of Austin

OTH THER POTE TENTIAL STR TRATEGIES FOR AFFORDABILITY

CodeNEXT

Affordability Prescription Paper

Fair Housing/CodeNEXT Resolution No. 20151210-030

Public Input

Draft Housing Plan for Public Review

Housing Plan Adoption and Implementation

Spring 2016 Summer 2016 Fall 2016 Spring 2017

Drafting Code Austin Housing Plan Draft Code

Winter 2016

CodeNEXT & Austin Strategic Housing Plan Timelines & Connections

Questions?

Erica Leak

Neighborhood Housing and Community Development nhcd@austintexas.gov