Challenge One: Define “Affordable”

Paul Bass PhotoMarkeshia Ricks PhotoThe city’s newly appointed Affordable Housing Task Force is looking to come up with a uniquely New Haven definition of “affordable.”

The task force put that at the top of its to-do list during a meeting Thursday at City Hall, as it tries to wrap its arms around a glaring problem that has arisen since the city has become a boomtown for high-end luxury apartments.

The task force has about six months to develop policies and recommendations to help the city preserve and encourage the creation of affordable housing including single-room occupancy options.

But first, members have to figure out what that means in New Haven.

Hill Alder Dolores Colon, a task force member, said the city is in crisis particularly given several high-profile housing emergencies that left people temporarily housed in hotels. She pointed to the years-long removal of more than 288 families from the currently being demolished Church Street South apartment complex, and the condemnation of the 66 Norton St.  complex, which resulted in the dislocation of 80 families in the Edgewood neighborhood.

“There is an urgency to this now,” she said. “We can’t be sitting around looking at reports ... We need to solve it like yesterday.”

As the city has worked with developers looking to provide market-rate housing in the city, “affordable” has meant encouraging developers to set aside up to 30 percent of their units for people who make no more than 80 percent of the area median income, or $70,480 out of an $88,100 benchmark for a family of four. That is the model that has been used in the Hill-to-Downtown project being developed by Randy Salvatore.

The U.S. Department of Housing and Urban Development says affordable housing shouldn’t consume more than 30 percent of a household’s income and provides rent subsidies to help low-income families meet their housing needs. The National Low Income Housing Coalition has determined that New Haven’s “housing wage,” or the hourly wage needed to afford a two-bedroom in the city, is $25.48, or about $50,000 a year. The median household income in New Haven is far short of that, at $37,162.

Ed Mattison, a task force member who helms the City Plan Commission, said the state and federal definitions of affordability don’t seem to fit very well when it comes to New Haven, though he noted that New Haven is not the only city grappling with the problem.

Otis Johnson Jr., a task force member who heads up the city’s Fair Rent Commission, said what he knows for sure is that he receives phone calls from people with subsidies who still can’t afford where they live.

“We do have a significant number of low-income, working-class people who go to work every day and can’t afford a place to live,” he said.

Johnson said he mostly hears from people in the city who are renting on average a two-bedroom apartment for about $850 a month. That seems reasonable until one learns that the apartment doesn’t meet code. He said if they were to go out and attempt to rent an apartment that was up to code it would cost them $1,250. That was largely the case for the families who were displaced from 66 Norton St. who struggled to find apartments on their construction worker and certified nursing assistant incomes.

Serena Neal-Sanjurjo, executive director of the city’s anti-blight agency Livable City Initiative, said that income is a major driver for the affordability conundrum. She said developers have the ability to create 1,000 units and can have them 95 percent leased before they’re even built.

“There’s no shortage of folks who can afford a market-rate apartment,” she said. “But there are a whole level of folks who can’t.”

In the coming months, the task force will develop a definition of affordable housing for the city, hearing presentations from local, state and federal experts as well as looking at models from around the country for solutions.

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posted by: wendy1 on July 13, 2018  9:39am

I define as affordable an apt. in Scandanavia.

posted by: anonymous on July 13, 2018  11:38am

While there are many solutions to providing supportive and subsidized housing, if we aren’t also building enough new units for people who can afford the “market price,” the housing crisis will continue to spiral out of control and overwhelm any other efforts. Middle class people will be pushed out of the existing housing stock and join the ranks of those who need subsidized housing, even as funding for subsidized housing stays pretty flat.

http://cityobservatory.org/the-end-of-the-housing-supply-debate-maybe/

How can we get developers to build the equivalent of another “360 State Street” in New Haven every 4-6 months instead of once every couple years?  Eliminate zoning and parking requirements?

In the absence of massive state and federal policy change, (e.g., the confiscation of private property to build thousands of free housing units, huge changes in tax policy so renters can claim the same types of credits that wealthy homeowners can claim, and/or massive cuts to defense spending or tax increases to fund subsidized new construction at the national level), building more housing at the market rate is the best if not only real way to fix this issue.

posted by: robn on July 13, 2018  12:26pm

So in other words, the city is jury rigging definitions of affordable? Will this mean even greater tax and rental competition bias against private landowners in favor of the one of the nations LARGEST per capita system of public housing? Remember taxpayers, the Housing Authority has been on a drunken orgy of building, expending a half million dollars per unit…all property tax free…all let out at subsidized rates.

posted by: Noteworthy on July 13, 2018  12:36pm

The idea that one can only rent a 2 br apartment that meets code for $1250 vs. $850 for one that doesn’t is a story not necessarily a reality.

Any discussion of affordable housing without a corresponding discussion of over-taxation is a worthless effort. Taxes drive rents and drive affordability of ownership. That this hand picked group will include this discussion is not likely.

posted by: Michael X on July 13, 2018  2:17pm

Run for cover when someone uses the word “affordable”.

posted by: Kevin McCarthy on July 13, 2018  7:13pm

Noteworthy, according to the Census Bureau, the median (average) rent in the city was $1,121 in 2017. This includes units that violate the Building Code as well as that meet code. It also includes studios and one bedroom units as well as larger apartments. So the $1,250 estimate for a two-bedroom that meets code is probably about right.

Taxes are clearly part of the reason why rents are so high. But reducing taxes would only have a modest impact on the shortage of affordable housing in the city. Let’s say that property taxes account for 40% of rental income (this is a guess, I suspect the actual number is lower) and the city was able to reverse the current tax increase. Assuming the landlord passed the entire tax cut along, this would be $55 reduction in rent on a $1,250 unit. I’m sure the tenants would appreciate the $55. But the unit would still be unaffordable for a median income household.

posted by: robn on July 13, 2018  7:27pm

KM

If people can’t afford to live in NHV, they can move to a cheaper suburb. The city isn’t responsible for guaranteeing access to everybody twho wants to live here. I would love to live in Manhattan but can’t afford to; so I don’t.

posted by: JCFremont on July 13, 2018  8:03pm

Well my definition of affordable would be, for the rent payer would 1/3 of yearly salary. For the landlord, investor the total rent for the property would be enough to pay the property tax, provide maintenance, long and short term repairs, insurance and perhaps a small profit for themselves or their investment partners. If it is city owned same as above minus profit and I suppose collecting property taxes would be redundant but what ever it is please at least break even!

posted by: THREEFIFTHS on July 13, 2018  10:13pm

The task force has about six months to develop policies and recommendations to help the city preserve and encourage the creation of affordable housing including single-room occupancy options

Do like Mayor Ras J. Baraka did in Newark N. J. where they passed the “Inclusionary Zoning for Affordable Housing” Ordinance which will require developers who are creating or rehabilitating housing projects of more than 30 units to set aside 20 percent of them as affordable housing. It mandates housing affordable to those in a different income levels ranging from 40 percent of the area’s median income to 80 percent. The marketing of the affordable units must give priority to Newark residents. the Newark ordinance applies to all new residential development throughout the city, not just in designated areas. And, unlike other cities, The affordable units must be provided on site and not in other locations. The affordable units may involve home ownership as well as rentals. Inclusionary Zoning for Affordable Housing Ordinance prevents the kind of gentrification that happens in other cities undergoing development.The Council also passed a measure to encourage developers to partner with Newark minority and women contractors as co-developers.

Read the whole Bill.

https://www.newarknj.gov/news/inclusionaryzoning

posted by: dad101 on July 14, 2018  7:06am

why not make rules to benefit the average landlord as well .That a property can only be taxed at a percentage of the profits that landlord makes for after mainlining their property..Oh yeah they cant do that because then the big developers would be the only ones paying much of anything and as it stands they are they only ones who get tax credits and rebates and that means they would make a few million less in profits and might not want to buy up properties in NEW HAVEN

posted by: wendy1 on July 14, 2018  10:30am

Ed Mattison sold the land under 360 State St. FOR ONE DOLLAR.  You can imagine what I think of him but I do love the building….
Commenters who suggest the poor move like “okies” from the Midwest during the Depression are very uninformed.  People with no safety net cant move and there is now nowhere to go that has jobs or “affordability” in this country.

posted by: FacChec on July 14, 2018  5:40pm

@Kevin McCarthy on July 13, 2018 7:13pm

You are correct concerning the median rent in New Haven @$1.121, however, affordability is not only measured by Taxes as correctly referenced by Noteworthy and expanded by you. Affordability must include the Census Bureau’s data collection of New Haven’s median household income @ $38,126 against a national average of $55.332 (2012- 2016) and per capita income$23,976 against a nation average of $29,829. More importantly the number of New Havener’s in poverty @ 26.1% against a nation average of 12.7%. (2012-2016. As referenced below @ census.gov.The Affordable Housing Task Force should be guided by these facts and those of the state of CT. AREA median income for New Haven county. 

https://www.census.gov/quickfacts/fact/table/newhavencityconnecticut,US#viewtop

posted by: robn on July 14, 2018  10:07pm

Sorry WENDY but I’m calling BS on your leftist propaganda. After Fairfield and Middlesex counties, New Haven county has higher rent than all other counties in CT. Our state could almost fit inside of a Houston or Indianapolis and like those places a 30 minute drive will get you from the center to any border.

https://www.rentdata.org/states/connecticut/201

A small minority of taxpayers shouldn’t be forced by incalcitrant politicians to subsidize people who just don’t want to move someplace where they can afford to live.

posted by: Kevin McCarthy on July 14, 2018  11:54pm

FacChec, we actually agree - the average New Haven household can not afford the average New Haven apartment using the 30% of income measure. BTW, did you mean to say “not” those of New Haven County in your last sentence?

Robn, according to the Census Bureau, the median rent for New Haven County ($1,075) virtually the same as the median for the city. A person working full time at a minimum wage job can afford to pay a bit more than $500/ month for housing. (Most people earning the minimum wage are adults, not kids.) In which suburb would you propose they look for an apartment?

3/5ths, I understand your enthusiasm for Newark’s inclusionary housing ordinance. But 40% of Newark’s AMI is $33,760, and the subsidized units will be unaffordable to many low-income residents. Doesn’t mean it’s a bad idea, just not a panacea.

posted by: THREEFIFTHS on July 15, 2018  1:09am

posted by: Kevin McCarthy on July 14, 2018 11:54pm

3/5ths, I understand your enthusiasm for Newark’s inclusionary housing ordinance. But 40% of Newark’s AMI is $33,760, and the subsidized units will be unaffordable to many low-income residents. Doesn’t mean it’s a bad idea, just not a panacea.

How come these apartments in New York Which also have inclusionary housing at 40% AMI.You pay for a Studio $548 and a One Bedroom $589 a month.

http://www.nychdc.com/content/pdf/ProjectAdvertisements/Hemlock.pdf

posted by: robn on July 15, 2018  6:09am

KM,

“After Fairfield and Middlesex counties, New Haven county has higher rent than all other counties in CT.”

That leaves five whole counties. Pick one.

https://www.rentdata.org/states/connecticut/2018

posted by: Paul Wessel on July 15, 2018  7:09am

Are there any affordable housing developers on the task force?  Neighborhood Housing Services and NeighborWorks would have a useful perspective.

posted by: FacChec on July 15, 2018  10:46am

@Robn
For the purpose of this discussion your referenced link describes:
“Fair Market Rent is determined each fiscal year by the HUD and is used to set payment standards for federal housing assistance programs in Connecticut. Your link also references HUD standards for federal assistance housing such as section 8 and RAPP. https://www.huduser.gov/portal/datasets/fmr.html

This affordable housing commission is considering :
As the city has worked with developers looking to provide market-rate housing in the city, “affordable” has meant encouraging developers to set aside up to 30 percent of their units for people who make no more than 80 percent of the area median income, or $70,480 out of an $88,100 benchmark for a family of four. 
As you can see the former HUD data allows landlords much larger rents than does the former, Affordable housing market-rate housing based on CT. State Area Median income by county. Alder Delores Colon (above) is mixing Church St. South, which is federally assisted, with Market rate rents established by Ct state Area Median Income. A stark difference.

I

posted by: robn on July 15, 2018  11:26am

FAC

Your point doesn’t change the relativity of rents in various CT counties, most cheaper than NHV and a short drive away. People have lots of choices, it’s just that our BOA is encouraging people to choose getting other people to pay for them to live in one of the state’s more expensive areas. This is coming out of the hides of working class homeowners/taxpayers in NHV (via wildly inflated property taxes) and they’re fed up with it.

posted by: FacChec on July 15, 2018  12:03pm

@ ROBN:

I have no idea what you just said.. It appears your response has no any bearing on the article as written.
The article does not mention taxes as some of us do.
With regard to what I believe you are saying regarding affordable rents, it appears you do not differentiate HUD assisted rents from Market rate rents that use different measures.

Moreover, HUD rents and affordable Market rents obviously differ from country to country. Mainly because of income, not by taxes. In New Haven taxes do play a part in Market rates due to the FAC that the city provides in some cases, builders up to 39 years tax abatement paid by the taxpayer for the term of the abatement.

Sec. 28-4. - Tax abatement on low and moderate income housing.

(c) Term. The abatement shall become effective on the date specified in the contract between the city and an owner of low and moderate income housing. The term of abatement shall extend for the remainder of the fiscal year in which abatement becomes effective and may continue for a period not to exceed thirty-nine (39) consecutive fiscal years thereafter.

Also, your comment here differs greatly from your comment @posted by: robn on July 13, 2018 7:27pm

KM

If people can’t afford to live in NHV, they can move to a cheaper suburb. The city isn’t responsible for guaranteeing access to everybody twho wants to live here. I would love to live in Manhattan but can’t afford to; so I don’t.

END of story…>>>OUT>>>

posted by: robn on July 15, 2018  12:44pm

FAC,

The article explicitly discusses the BOA setting an affordable housing standard higher than Housing and Urban Development when negotiating with developers to include affordable housing. The city’s traditional way of negotiating with developers is to offer multi-year tax abatements which are then immediately paid for by the remaining taxpayers. So there’s the connection between affordable housing and taxpayers.

posted by: NewHavenerToo on July 15, 2018  9:58pm

Wait….on subsidy and can’t afford their rent?  Well, I was on subsidy and if budgeting responsibly, one CAN afford the rent.  I didn’t have cable, or a brand new cell or a car with payments.  I did my own nails and Christmas was not about giving my child 2, 3 or 4 gifts, but keeping my housing.  I say this as a past participant of Section 8 (thank God I had it when I needed it) and as a mother of an adult child who is now on subsidy.