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HomeMy WebLinkAbout05-26-2005 IOWA CITY SCATTERED SITE HOUSING TASKFORCE MEETING AGENDA 26 May 2005 City Hall 410 East Washington Street Lobby Conference Room 4:30 p.m. 1. Call to Order 2. Approval of Minutes from April 25, 2005 3. Discussion of Draft Recommendations from Taskforce to City Council 4. Adjournment MINUTES SCATTERED SITE HOUSING TASKFORCE APRIL 25,2005 HARVAT HALL, CITY HALL p IMINARY MEMBERS PRESENT: Don Anciaux, Jerry Anthony, Darlene Clausen, Matthew Hayek, Jan Leff, Jan Peterson, Sally Stutsman, Joan Vandenberg STAFF PRESENT: Steve Nasby, Steve Rackis OTHERS PRESENT: Amanda Cline, Maryann Dennis, Charles Eastham, Tracy Glaesemann, Luke Pelz, Patti Santangelo CALL TO ORDER: Chairperson Hayek called the hearing to order at 4:35 pm. APPROVAL OF MARCH 28. 2005 AND APRIL 24,2005 MINUTES: Hayek asked if there were revisions for the March 28 Minutes. Several typographical edits submitted for the Minutes. MOTION: A motion was made by Stutsman, seconded by Peterson, to approve the March 28, 2005 Minutes as amended. Motion carried unanimously. Anciaux arrived. Hayek asked if there were revisions for the April 4,2005 Minutes. Several typographical edits submitted for the Minutes. Hayek suggested a change on page four in the first full paragraph to say, "the project was still funded by I FA." Anthony agreed. MOTION: A motion was made by Stutsman, seconded by Leff, to approve the April 18, 2005 Minutes as amended. Motion carried unanimously. DISCUSSION OF DRAFT RECOMMENDATIONS FROM TASKFORCE TO CITY COUNCIL: Hayek reviewed the progress from the last meeting. He noted that several of the original recommendation points were revised or clarified, while some items were tabled for further discussion. The packets sent to the Taskforce members for the current meeting included a draft of the updated recommendations, dated April 19, 2005. He said that is the current working draft and asked whether the Taskforce would like to talk about the matrix first, or after reviewing the other points. General agreement expressed to discuss the matrix first. Vandenberg said she and Anthony worked on the matrix, and they both think it is important to evaluate the assisted units in a context containing all housing units, rather than just rental units. If the Taskforce would like more rental units to go into more neighborhoods, it makes sense for the comparison to be with all units in the block groups. However, using the matrix numbers with all units naturally leads to the percentages of assisted units being smaller. Stutsman asked for a definition of "all" housing units. Anthony said it is both rental and owner-occupied. Vandenberg agreed it would be all households, and noted that the data had been included on one of the earlier drafts of the matrix, but then was not used. Anthony said data included since January has been rental only, so changing to all units is a large shift from previous discussions. Vandenberg noted for example in tract 105 that the number of rental units is 109, while the total number of household units is 780. As such the percentage of the 75 assisted units in the tract is a very different percent when compared to 780 total units, versus on the 109 rental units. Vandenberg said she and Anthony were also looking at ways to evaluate the nature of the assisted housing units. There is a continuum in the community of emergency housing, transitional housing, and housing for the elderly and disabled. Additional columns on the matrix would indicate the numbers of elderly/disabled units, and emergency/transitional units in each block group. The idea is to have the total Scattered Site Housing Taskforce Minutes April 25, 2005 Page 2 number of assisted units, but also to have the data divided three different ways, to see the different housing types. Clausen asked for confirmation that the new columns would have data only from different types of housing, such as elderly\disabled. Vandenberg said yes, the first new column indicates the number of assisted housing units, excluding the elderly/disabled and emergency/transitional. The next column indicates how many emergency/transitional units are in an area, since those types of housing have a higher need for other services nearby. The third column has the total number of all assisted housing units. The block group would be flagged if any of those three columns were higher than the city average. Vandenberg continued by noting that block groups will vary in the number of flags in those three columns. If all three columns are flagged, that area would be a "low" priority for additional assisted housing. She said Nasby suggested block groups with two flags would be areas to encourage "home ownership". One flag would be "medium" priority for additional housing, while no flags would have a "high" priority. This goes back to gradations in incentives, rather than an either/or approach to future development of assisted units. The idea is to look at the different types of housing without being exclusionary. Vandenberg said another option for an additional column would be the "potential for development" in a particular area. She said that another column could be added to indicate an area's accessibility to other services and jobs, though that is not something for this Taskforce to evaluate. Peterson suggested including that column but leaving it blank, to keep that issue in mind for those who look at the matrix later. Stutsman asked if the matrix would be included with the materials given to City Council. Vandenberg said yes, after the Taskforce approves it. Vandenberg said the Taskforce needs to decide if the percentages on the new matrix should be flagged if they are above the city average, or if the city average numbers should be multiplied by 110 percent. Anthony added that the data for both the number of assisted rental units and the number of all rental units should be from the same year, which has not yet been adjusted. Currently the number of assisted units is from 2004, while the number of all units is from the 2000 Census (data collected in 1999). He also said the development potential and access to services columns have not been incorporated into the matrix yet. Not having those three things, he and Vandenberg evaluated the current data and shifted the focus from just rental units to include all units. Anthony said he and Vandenberg have not concluded yet how to construct the matrix. He agreed that a decision needs to be made whether to use the citywide average or something else. If something else, that method needs to be developed and explained. Hayek asked what led to the three new columns. Vandenberg said she thinks the elderly/disabled housing skews the data, since that type of assisted housing has a lower impact on the neighborhood. At the same time, emergency and transitional housing has a much higher impact because of the needs that accompany families at that level. The third column, including all units, might be redundant. Peterson said she likes having the three columns there, dividing the data into the different types. Anthony said the largest change was from counting only rental units to counting all units. Hayek asked what the rationale was for that change. Anthony said some block groups do not have many rental units overall. For example, tract 105 has 109 rental units and 80 of them are assisted. One of the recommendations said there should be a better distribution of rental units, both assisted and unassisted. Using data from all units will target the distribution of rental units. Stutsman asked what definition would be used for potential for development. Vandenberg said it would probably be new construction, but that does not address the potential for acquisition or rehab of current units. Peterson said rehab units were supposed to be discussed at this meeting. Hayek said that was more along the lines of not limiting funding for maintenance of existing units. Anciaux asked if "existing" meant a unit that is already a transitional housing unit, or an existing unit that would be converted into a new transitional unit. Hayek said it is not about changing the type of housing, but allowing funds to be put into maintaining an existing unit currently owned by HACAP. Scattered Site Housing Taskforce Minutes April 25, 2005 Page 3 Peterson said she was unsure which rehab situation was being addressed at the public hearing. Anciaux said he understood the question to be about purchasing a dilapidated unit and renovating and converting it into a new transitional housing unit. Hayek said that he thought that was a separate issue. Peterson agreed that is another situation the Taskforce should clarify. Hayek said he understood it to be a question of funding current transitional units for maintenance. Anciaux said he understood it to mean buying and rehabilitating a unit, thus increasing the number of transitional units. Peterson agreed with Anciaux's understanding, that it was not a new building, but would be a new transitional unit. Hayek said he sees no difference between building a new unit versus converting an existing unit in an affected area. Peterson said that was the question. Vandenberg asked Nasby if he has anything to add regarding how to better define new versus rehab. Nasby said the City has funded straight acquisition with HACAP and Successful Living, mostly with transitional housing. They identify the unit and purchase it, and it becomes part of their stock, so it does not involve building or rehabbing. They have also done solely a rehab of property. Vandenberg asked if new construction or converting existing units is easier. Nasby said no way is easy, but there are benefits to both approaches. Dennis asked if an applicant for federal aid through the city generally knows where a new unit will be going. Nasby said not necessarily as the last few projects the City funded did not have sites. Dennis said when the Housing Fellowship applies for new units; they do not always know where they will be located. They have a budget and a general per unit cost. Nasby agreed that is how it usually works. Anciaux asked if the Fellowship is required to locate units in Iowa City. Dennis said yes, if the funding is administered by Iowa City, but they do have units in Coralville, and owner-occupied units in Lone Tree that were not City funded. Vandenberg suggested calling the column potential for new construction instead, since it would be difficult to evaluate areas for other types of construction so that might clarify things. Leff asked if access to services refers primarily to transportation. Vandenberg said she was thinking about where jobs are and where transportation systems are. Peterson said they would be things that are necessary to sustain self- sufficiency. Clausen asked if it would include childcare. Hayek asked how the potential for development and access to services would play into the matrix. Vandenberg said she sees those as the second part of the process in identifying areas for development. This approach would identify the ideal place to develop, which has access to those services and a low concentration of existing assisted housing. Those things would not necessarily be part of the policy, but would be additional information to consider when looking at future development. Hayek asked if those columns would affect the preference column. Vandenberg said maybe. Peterson said even if that column is blank, she would like to include it in the materials given to the Council as items that should be investigated when pursuing future development. Anthony noted access to services was addressed several times at the public hearing, so it would be helpful to address it. Hayek asked if anything could be decided on at this meeting that would help the subcommittee with their next step. Stutsman said it appeared that all the Taskforce members were in agreement to add the new columns. Anthony said he has some concerns about the columns, most importantly the question of what the cutoff should be. He asked if the cutoff should be the city average or something else. Peterson suggested looking at both options, to see which most closely demonstrates what the Taskforce is trying to say. She does not know how the data will appear. Vandenberg noted that the data needs to be updated before it can be evaluated. Peterson asked how 110 percent is different from "more than 10 percent above the city average." Anthony said for example if a tract has 20 assisted units and 1000 total units, assisted units comprise 2 percent of the total. If the city average is .5 percent, 110 percent of .5 percent would be .55 percent. With the CITY STEPS approach, adding 10 percent to the city average, the percent would instead be 10.5 percent. So the difference is between .55 percent and 10.5 percent. Anthony noted that any cutoff except the CITY STEPS approach would have to be explained and justified. He said a third option would be to use the city average, and a fourth option is to use two times the standard deviation, which is fairly common in statistical analysis. Any value that is two standard Scattered Site Housing Taskforce Minutes April 25, 2005 Page 4 deviations on either side of the mean would be considered an extreme case. Peterson asked for confirmation that CITY STEPS adds 10 percent to the city average. Anthony said yes. Nasby said that as an example, in CITY STEPS, the citywide average is used in showing low and moderate-income concentrations. The City average of low-moderate income household is 53 percent, so anything higher than 63 percent is concentrated by that definition. He noted that the 10% approach in CITY STEPS deals with larger percentages. Vandenberg added that the percentages of assisted units are very small now that all housing units are figured into the data. Anthony said that CITY STEPS percentages are small as well. Anciaux said that even though the percentages are small, problem areas could still be identified. Anthony agreed. Hayek asked if the Taskforce could decide the statistical question at this time. Anthony said a judgment call should be made on which method to use, and then see what the results look like. Stutsman suggested going with the CITY STEPS option, since it has been used before. Anthony agreed that would be the easiest approach as far as the easiest to defend, since it is already established, but others might disagree on whether it would reflect what the Taskforce is saying. Hayek said that without the elderly/disabled unit numbers, a 10 percent rule would not flag any block groups. Peterson agreed that she is concerned that the number would be so big that all the work up to this point would be useless. Anthony said that with total assisted units, the citywide average is 4.07, and there are block groups with greater than 14 percent. Anciaux asked which ones. Anthony said 4.1 and 21.2, but 18.2 is not flagged using the citywide average, though it would be flagged with transitional housing. Hayek asked what the citywide average of emergency/transitional housing is. Vandenberg said that with the current numbers, the average is .5 percent, which would then translate to 10.5 percent as being the threshold. Hayek noted that nothing in two of the three new columns would be flagged using that method. Peterson said, as such, she is concerned by that approach. Hayek said in the third column, only two block groups are flagged. Anciaux asked which two are flagged. Hayek said 4.1 and 21.2. Anciaux noted that 21.2 would include student populations. Hayek said he does not know specifics about the standard deviation approach. Anthony said he has not applied it to this issue, but it is a fairly common statistical measure. Peterson agreed. Hayek asked if it would be difficult to explain, and asked for an explanation of how it would work. Anthony said if the city average for all assisted units is 4.07, and the standard deviation is 1 percent, then any value above 4.07 plus two times one, or 6.07, would be concentrated. Vandenberg asked how the standard deviation would be calculated. Anthony said the software would calculate it. Vandenberg asked approximately what it would be. Anthony said it depends on the distribution and there is no way to know ahead of time. Vandenberg said she is concerned that whatever method used will catch all the nuances of the data, considering the very small percentages. Peterson said that seeing all the results of the different methods would be helpful. Anthony said the data can be calculated using all the methods very easily, but defending the method might be more difficult. Peterson asked for confirmation that, in terms of explaining and justifying it, the method applying 110 percent would be the most difficult to use. Anthony agreed. He asked if the data should be calculated using all four methods. Hayek agreed. Hayek asked if there was consensus to use data from the same year for consistency's sake. Anciaux agreed, if the data is available. Peterson asked which way the data should be adjusted, and if the census data can be updated. Anthony said city staff has provided the total number of new units constructed since 1999, though that does not include the block groups where they are located. Nasby said building permit information could be used from 2000-2004. It does not indicate whether the structure was actually built, but it would give some idea on the number. That information can then be geocoded to give the block group locations. He said the other method would be to discount assisted housing built since 2000. Peterson said she would prefer not to discount the assisted housing built after 2000. Anthony agreed that if data on units built since the census is available, it should be used. Scattered Site Housing Taskforce Minutes April 25, 2005 Page 5 Rackis said that a much larger number of unassisted rental units have been built since 2000 than assisted units. Out of 2000 units built in that time, only 75 are assisted. Anciaux asked how many of the 2000 units are in the Lodge. Nasby said about 220. Hayek asked how long it would take to gather that information. Glaeseman said it is done and would be available for the next meeting. Hayek asked if there was consensus to update the census data to include new construction since 2000. The Taskforce members agreed. Hayek asked about the "access to services" and "potential for development" columns. Anthony said the subcommittee has yet to come up with some measures for those two. Vandenberg said she thinks those items are in the implementation phases, which are included only as topics for consideration while developing an overall plan. Peterson agreed. Hayek said the Taskforce could suggest the city consider those aspects. He asked whether the columns should be included. Peterson said she would like them to be included, even if they are blank. If it is only in the narrative, it might get lost. Dennis noted that there are not any services available where land has not been developed. Rackis said that there are no bus routes in the peninsula area yet. Vandenberg asked if a route would be put in that area. Rackis said it is a matter of supply and demand. Hayek asked about the three new columns. Vandenberg reiterated that they would be the percent assisted without elderly/disabled, percent of emergency and transitional, and percent of all assisted units. Peterson said she already stated her opinion. Anthony said he and Vandenberg have not discussed the new columns. Anciaux asked if a heavier weight could be put on emergency and transitional housing. Anthony said yes. Anciaux asked if that could be justified because of the heavier reliance on services. Anthony said that is unknown. Stutsman asked if that is an unfair assumption. Peterson said no, because a family in emergency or transitional housing would by definition have high needs. Anciaux said in terms of the high percentage of transitional housing in block group 18.2, a transportation service program should be developed to allow transitional housing to be located in other areas. Peterson asked if that would be provided by HACAP. Anciaux said yes. Leff said the intent of the question regarding rehab housing is not clear from the minutes from the hearing. Hayek said that building a new unit and converting an existing building are the same. Peterson agreed, but noted the important thing is that the Taskforce members are in agreement about what is being discussed, and the recommendations are clear as well. Anciaux said that if the question is about converting existing buildings into new transitional housing, there are buildings in other parts of Iowa City that can be converted. Hayek said the minutes from the last meeting say, "Hayek noted that a point raised at the hearing was to insure that the policies do not impact the ability to maintain and rehabilitate existing housing." Anciaux said he does not object to maintaining current transitional housing. However, as 45 percent of transitional housing is located in block group 18.2, something needs to be done to spread it out in the future. Leff said the minutes from the hearing say, "He foresees possible difficulty with the rehabilitation of older housing in the prohibited areas. Buying and renovating helps revitalize neighborhoods and keep them from getting run down." Peterson and Anciaux agreed that sounds like buying new units and converting them. Peterson said what Axeen was saying is that this is good for the neighborhood. Anciaux said there are other places outside of 18.2 where that can be done. Leff said the minutes from the hearing go on to say, "There should be a process to allow rehabilitation projects to take place in prohibited areas.. .." She added that she could understand Peterson's and Anciaux's interpretation. Peterson asked if all of the Taskforce members are in agreement that what is meant by rehabilitation of units needs to be clarified in light of this. All agreed. Vandenberg asked about Anthony's reservations regarding the three new columns. Anthony said the matrix refers to specific policy objectives 2 and 3. However, specific policy objective 1 already explicitly refers to transitional housing. He is not sure having it also in the matrix is necessary. He also asked for clarification from staff whether it is okay for elderly to be specifically identified and removed from the data. That is permissible with emergency/transitional, but is it permissible with elderly housing asked Anthony. Scattered Site Housing Taskforce Minutes April 25, 2005 Page 6 Nasby said that it did not appear the elderly\disabled are being singled out as a separate group, since they are included in the data. He said it was also his understanding from the attorney that emergency and transitional housing can be specified, and said he would check with the attorney regarding elderly\disabled. Anthony said he would like to know for sure. Peterson said she thinks having the column information available is about looking at each block group and understanding what is located there. There is a difference in the kinds of impacts from different types, and it is helpful to see what is in the neighborhoods. Stutsman agreed, and noted that having the information available would assist with the educational aspect. Peterson said that it would be helpful also to have student housing information. Clausen asked for confirmation that the column with assisted units excluding elderly and disabled does include emergency and transitional. Vandenberg said yes. Hayek said it seemed there was nothing else to discuss on the matrix until the new data has been gathered. Anthony said that he would like to define what high, medium, and low preferences mean. He said one way to define them would be to assign a dollar amount to each level. Peterson suggested letting the city decide on the levels. Vandenberg said that her understanding is high would have incentives and low would not have incentives. Medium would therefore have some incentives. Anthony said once the development potential data is available; the preferences could be fine tuned. Hayek suggested moving on to the other discussion points. He said he would like to cover everything else and leave the matrix as the only unresolved issue at the end of the meeting. He suggested quickly reviewing the objective points in order again. All agreed. Hayek said the only change to general objective 1 was from "maintain" to "strengthen." General agreement was expressed for that change. Hayek said the change to general objective 2 was from "without reducing" to "while increasing." Peterson said she is not sure what housing is being referenced in objective 2. She said that increasing the supply of housing for her would mean affordable housing rather than only assisted housing. The absence of affordable housing is why there is such a high demand for assisted housing. Increasing affordable housing would decrease the pressure for assisted housing. Peterson said her concern is that general objective 2 is recommending an increase in assisted housing, when she would like to increase affordable housing. If it becomes impossible to scatter assisted housing and increase the stock of assisted housing at the same time, linking those two objectives together might result in both being lost. She said there is a difference between affordable and assisted housing that should be clarified. Anthony said that general objective 1 asks for an increase in affordable housing generally, and then the second objective talks about assisted. So he views that as asking the city to primarily increase the supply of affordable housing, and if not, then increase assisted housing to help make up for the shortfall. Peterson asked if Anthony thinks the city can scatter and increase at the same time. Anthony said if one assisted unit is built next year outside of 18.2, then both objectives have been met. Peterson asked if the objective says "maintain," and 18.2 is not available for development, then it would have to be scattered. Anthony said yes, but the potential is that the city could scatter without increasing and addressing the need for affordable housing. Peterson asked if he meant affordable or assisted, since this objective refers to assisted. Anthony said assisted. Anciaux said the Taskforce would have to rely on the elected officials to evaluate the recommendations versus their budget, and do the right thing. He thinks that if the money is available, they would do it, but if the money is not available, then they cannot do it. Hayek said he shares Peterson's concern. He said he is worried that with this set of recommendations, the Taskforce might be overreaching. He would like to strike a balance between challenging the city to take bold steps, but still make the recommendations practical. Anthony said he believes specific objective 2 is more demanding than the general objective 2. Hayek said those are two different concepts. Specific objective 2 talks about spending money to bring the same supply on board in a scattered fashion. Scattered Site Housing Taskforce Minutes April 25, 2005 Page 7 Peterson said the original general objective 2 asked for maintaining the current supply. She asked if it would be over reaching to recommend the city strengthen its commitment to assisted housing while increasing affordable housing, and also recommending the city increase the supply of assisted housing while scattering it. Anthony said the city could then say the current supply is all that is needed, which he is not comfortable with. Unless affordable housing is available for everyone, the supply of assisted housing should not be blocked. Also, asking for an increased supply will protect the recommendations from challenges of exclusionary effects. Anciaux said there are ways to incent developers to help with the recommendations without costing the city extra money. Vandenberg agreed, and asked whether the Taskforce would prefer more units or scattered units, assuming the city has a limited amount of money to spend. Anthony said that is a public policy question, whether the benefits of scattering outweigh the negative aspects of not having enough affordable housing. Peterson asked if Anthony meant assisted housing. Anthony said assisted, but only if enough affordable housing is available for everyone. If that is the case, then the amount of assisted housing can be reduced. A significant portion of the population in Iowa City does not have affordable housing, and the numbers are not changing significantly. Anciaux said if assisted housing is primarily located in one area, the property values will decline in the area, allowing more to be purchased there. Anthony said he does not agree, since property values in tract 18.2 are higher than many other places. Hayek confirmed that all the Taskforce members agree that a scattered site policy is a worthwhile endeavor, and most agree it would cost money to adopt the policy since a reduction in the available assisted housing is not a desirable outcome. He said that the general objectives started out saying that if the supply can be maintained while extra funds are made available to scatter, then scattering is desirable. However, asking also to spend additional money to increase assisted housing might take the recommendations beyond the realm of practical consideration. Peterson suggested leaving general objective 1 as currently stated, to strengthen the commitment and increase opportunities, and then change general objective 2 by adding a period after "community" and deleting the final clause. Vandenberg said she agrees. Anciaux agreed with removing "increasing" and "spend money" as much as possible. Peterson asked Anthony if that would be agreeable, even though it sidesteps the issue. Anthony replied that he would like a commitment to affordable housing in each of the objectives, so that if the city adopts anyone of them, affordable housing would be part of it. Hayek said he agreed with Peterson's suggested edit. Leff agreed as well. Clausen said she shared Anthony's concern. Peterson said that any part of the recommendations could be ignored by the city. Anthony agreed, but said it should be there, allowing the city do the editing. Hayek noted the Taskforce members are not in agreement on whether the clause should be in the objective. Vandenberg said including the end clause dilutes the commitment to scattering. Anthony said the issue really is as Vandenberg said a question of whether the benefits of scattering assisted housing outweigh the potential negative impacts of reducing the amount of assisted housing that is available. Anthony said the question is whether such a policy would benefit the public good, and if it cannot be proven to benefit the public good, the policy can be challenged at any time and struck down. Hayek said there is a diversity of opinion on what constitutes a benefit to the public good. Anthony agreed, and said if the policy cannot be proven to be a benefit, it will be struck down. Vandenberg asked who could strike it. Anthony said anyone who challenges it, if it goes to court, it would be struck down. Stutsman said she would like the city legal staff to respond to that, and give their opinion about the issue. Hayek said that scattered site policies have been adopted in many communities already. Anthony agreed, and noted that those communities have been able to demonstrate the benefits of the policy. He said that usually those policies are accompanied by additional funding and inclusionary housing policies, as well. Hayek said the three options are to leave the statement as written, stop the sentence after the word "community," or change the statement back to as it was originally written to say "maintaining the supply." Peterson said she does not agree with the third option to change back to "maintain," while ending the sentence after "community" asks for an increase in stock in conjunction with scattering. Stutsman, Leff, and Vandenberg agreed. Anthony and Clausen said they would like to keep the final clause. Scattered Site Housing Taskforce Minutes April 25, 2005 Page 8 Stutsman asked if a minority opinion could be noted. Hayek said yes, consensus is not needed for every objective. The narrative can indicate that complete consensus was not reached for certain points. He suggested taking a vote on the issue. Peterson confirmed that the reason for the lack of consensus on this point could be explained in the narrative. Hayek said yes. Rackis noted for clarification that the primary source of funds for assisted housing has been HOME and CDBG funds, which are primarily used as financial assistance to build affordable housing. The funds are not used to provide direct housing payment assistance. He suggested recommending CDBG and HOME funds continue to be used for that purpose, but then also recommend increased commitment to find ways to build affordable housing throughout the community. Anthony suggested a fourth option for general objective 2, to say, "Iowa City should adopt a scattered site policy to ensure a fair share distribution of assisted housing in the community without using CDBG and HOME funds for scattering." Peterson asked how that would be accomplished. Anthony said by putting in additional resources. Peterson asked for confirmation that this would mean funding for scattering would mean new funding, rather than CDBG and HOME funds. Anthony agreed. Hayek said that is already being requested. Nasby questioned if Anthony's suggestion would put CDBG and HOME funds into housing only in the tracts that are already concentrated. Anthony disagreed, saying if a new affordable unit could come into the housing supply using CDBG funding; the easiest option might be for it to be located into one of the concentrated areas. Putting it elsewhere would require additional funding to pay the land price differential. Nasby said the assumption is then development would only occur in the over represented tracts. Anthony noted that if land was available in under represented tracts, and the land was zoned for it, a lot of the developments in 18.2 would have been located in those other areas. Assisted housing does not locate in 18.2 by choice, but for purely financial reasons. So he is suggesting funding from somewhere other than CDBG and HOME funds to pay for the land price differential. Peterson asked if both types of funding, both CDBG/HOME funds as well as additional funding, could be used to locate assisted housing outside of the concentrated areas. Vandenberg asked if this should be addressed as a specific objective instead of a general one. Hayek said the general policy objectives are designed to express the global findings. Peterson agreed, noting that otherwise both the general and specific points number 2 would say the same thing. Hayek suggested voting on the proposed change to general objective 2, adding a period after the word "community," and deleting the final clause. MOTION: Peterson moved to edit the general policy objective 2 to say, "Iowa City should adopt a scattered site policy to ensure a fair share distribution of assisted housing throughout the community." Leff seconded. Anthony objected to the revision, saying that the original change to "increasing" was reached after much discussion at the previous meeting. He still agrees with the reasoning for the original edit, which was a widespread concern expressed at the public hearing that the policy statement would result in a reduction of affordable housing. Everyone at the public hearing said scattering is a good thing only if affordable housing is protected from reduction. Eastham asked Peterson to explain why the motion for the current revision was proposed. Peterson said her concerns from the previous meeting were twofold. First, there is some confusion between the terms assisted and affordable. She said she feels strongly that the community needs to increase the availability of affordable housing, and it is the absence of affordable housing that creates a great need for assisted housing. Second, since general objective 1 asks for an increased commitment to assisted housing as well as an increase in affordable housing, and general objective 2 asks for scattering, adding a clause to request an increase in assisted housing while scattering might be over reaching. The final clause seemed redundant and excessive. Anthony said the entire scattering policy could be discarded for reasons unrelated to what it says, and that he would address that point later. Hayek asked if anyone else would like to address that issue. Stutsman said that looking at it from a policymaker perspective, the first two general policy statements should not contain too many specifics, but only address the overall goals the Taskforce would like the city Scattered Site Housing Taskforce Minutes April 25, 2005 Page 9 to pursue. Peterson noted that specific objective 2 does ask for additional funds beyond CDBG and HOME funding. Leff said the phrase "strengthen the commitment" implies supplying additional resources. Hayek asked for a vote. The motion was passed with a vote of 5 in favor, and 3 against (Anthony, Clausen, Anciaux). Hayek addressed the narrative at this point, suggesting that once the recommendations are finalized, the subcommittee comprised of Anthony, Hayek, and Vandenberg would draft the narrative. Then, instead of having the Taskforce meet to go through the entire document together, give each member an opportunity to write an additional supplemental piece to attach to the narrative document. That would give all members an opportunity to express their individual opinions and note the issues they are particularly concerned about. Anthony asked that the Taskforce have an opportunity to read and vote on the narrative, and asked that it be sent to the members in their meeting packets. Hayek asked for confirmation that Anthony is not recommending a line-by-line evaluation. Anthony said no, to vote on whether to accept the entire document. Hayek said he raised that point now because of the close vote on general objective 2. Hayek suggested reviewing the specific objectives. He reviewed changes to specific objective 1, to move one sentence to the beginning of the statement, and deleting the final sentence. Stutsman asked for clarification of what the phrase "make land available" means in this objective. She said that could be interpreted as the city needing to buy the land and make it available for emergency housing, rather than through zoning or other means. Anciaux said in this situation he thinks the city should buy the land, using CDBG or other funds. Hayek asked if Anciaux says that because of the difficulty of finding land for that type of housing anywhere in the city. Anciaux said yes. Anthony noted that there is land available in several places, such as the land now committed to the Super Wal-Mart. Anciaux said yes, but while there is still land available in that area, it is not located close to schools or downtown services such as the recreation center and library. Hayek said the original specific objective 2 was deleted, so all the other objectives have changed numbers. He suggested tabling discussion on specific objectives 2 and 3 until the matrix has been finalized. All agreed. Hayek said there were no changes to objective 4. The only change to objective 5 was to change "almost all" to "most." Hayek said that objective 6 had substantial changes, including the addition of the word "additionaL" Stutsman asked if the hyphenated "low-moderate" could be changed to "low or moderate." Clausen suggested changing it to "low to moderate." Nasby suggested specifying the income level, such as "under 80 percent area mean average." All agreed with that Nasby's suggestion. Hayek confirmed the statement would read, "The City should take additional steps to increase sustainable home ownership among its population under 80 percent area mean income." All agreed. Hayek asked Vandenberg for the revision to objective 7. Vandenberg distributed copies to the Taskforce members. She said she is not sure who is being referred to in the statement, since she is thinking about the high-end needs population, such as the homeless and near homeless. Peterson said the discussion was for the broader continuum, because even families that have recently moved into home ownership will not be able to sustain it without access to additional services. Hayek said the discussion about services was broad, but noted that the bulk of the needs are at the lower end. Vandenberg said there are different levels of need, so defining terms and containing the spectrum could be difficult. Clausen asked about adding the word "creative", and deleting the word "other." Peterson said the original idea was for creative collaborations. Anciaux asked what Human Services does for families who are homeless or near homeless. Peterson said the department hardly gets involved unless there is a substantiated child abuse situation. Stutsman said she would prefer not to use the word "creative," and to leave "low-income" in as a preventive measure. Sometimes if low-income families have help, they will not become homeless or near homeless. Scattered Site Housing Taskforce Minutes April 25, 2005 Page 10 Hayek asked for confirmation that "homeless/near homeless" should be deleted from the statement. Stutsman said yes, change that to "low-income." Peterson confirmed that the statement currently says, "The City should work collaboratively with private and other public partners to develop comprehensive support services for low income families." Hayek asked about the second sentence. Leff said it is important to specifically state some of the services the Taskforce is talking about, to give examples of what is being referenced. Vandenberg said skill development could refer to either students or adults. Leff agreed. Dennis suggested changing it to "low income households," to be more inclusive. The Taskforce members agreed. Peterson asked about including job opportunities. Stutsman said that is included in the phrase, "among the many needs," otherwise the list could be very long. Hayek said that objective 8 had a change to say, "The policy should offer effective incentives for developers to include a percent of affordable housing in new developments." All agreed. Hayek said the change to objective 9 was "perils" to "impact." All agreed. Hayek said objective 10 had the word "local" deleted. All agreed. Hayek said objective 11 asks for "vigorous enforcement" of the nuisance law, and clarified the second sentence to indicate that neighborhood opposition to assisted housing is often caused by insufficient management of housing that is not assisted. All agreed. Hayek said objective 12 had no changes, and objective 13 had the first clause removed. All agreed. Leff asked if a disclaimer statement should be written to specify that "City" throughout the document refers to Iowa City. Unless "City" should stand for Iowa City, it should not be capitalized. Peterson said it should stand for Iowa City. Leff said a statement at the beginning should specify that. Anciaux suggested saying, "Iowa City, hereafter referred to as the City." All agreed. Peterson asked to review the order of the objectives. Vandenberg said that considering the education aspect is important, she would put that point as specific objective 1. Then objective 2 would be collaboration with other municipalities, so the current number 9 would be 1 and the current 10 would be 2. Anciaux said he would prefer keeping the current number 1 in its current place. Vandenberg said that would be fine, but would like to put numbers 9 and 10 higher in the list. Clausen said she would like to move number 7 higher on the list as well. Vandenberg said her rationale is that the education and collaboration are important for getting the work done. Peterson asked for confirmation that Vandenberg is beginning the list by saying the public needs to be educated about why this is important, the whole county needs to be enlisted because this is a wider issue, and then the others are specific things that Iowa City needs to do. Vandenberg agreed. Clausen said the current number 7 should be moved up, perhaps after the other points. Leff asked if these are being ordered chronologically, or according to importance. Ordering them with education and enlistment first might imply that those things need to be done before any of the other objectives could be met. Anthony suggested organizing the specific objectives according to the related general policy objective. So the specific objectives that would help to achieve each general objective would be organized together. Hayek said that two umbrella headings, which are the two general policy objectives, could each be put on a separate page with their supporting specific objectives. Vandenberg noted that some specific objectives would fit under both general objectives. Rackis suggested grouping them according to things Iowa City has absolute control over versus those things that would require collaboration. Stutsman said they could be ordered according to priority. She said to her a list of recommendations would have the most important points first. Peterson said that was what prompted the group to reconsider the order, and put 9 and 10 higher on the list. Hayek said those two statements are more positive from a marketing perspective. Peterson agreed, noting those statements do not leave Iowa City as solely responsible for improvements. Hayek said he agrees with moving 9 and 10 up to 1 and 2, and 7 up as well. Anciaux said he would like the current number 1 to stay near the top, because it addresses both 1 and 2. Scattered Site Housing Taskforce Minutes April 25, 2005 Page 11 Clausen confirmed that the new order is as follows: 1 is 3, 2 is 4,3 is 5, 4 is 6,5 is 8,6 is 9,7 is 7, 8 is 10, 9 is 1, 10 is 2, and 11, 12, and 13 remain the same. Hayek confirmed there were no other comments regarding the order. None were raised. Stutsman said she would like to discuss what the Taskforce members want in the narrative, in order to give the subcommittee some direction. Anthony agreed, and said it should be done during this meeting. Hayek said the narrative starts out with a general explanation about the Taskforce, including a discussion of the process, how the Taskforce was formed, when it met, who presented, and other general information. Then it goes into the core findings, which is not fully developed because it was begun before the objectives were written. Vandenberg suggested e-mailing the outline to the Taskforce members, and allowing each person to respond. Hayek said the open meeting policy is not violated if people respond individually. Stutsman asked if Hayek plans to have the narrative written for the next meeting. Hayek said yes. Next meeting scheduled for Thursday, May 26, 2005 at 4:30. Hayek confirmed that he would e-mail the basic outline of the narrative out to the Taskforce members, who then should email back individually any additional notes or issues that should be addressed in the narrative to any of the subcommittee members. Nasby asked if a deadline should be included for responses. Hayek said he would include that in the e-mail message. Anthony asked if the subcommittee could look at other communities' matrices for comparison purposes, if they find that information. The Taskforce members agreed. ADJOURNMENT: There being no other business to come before the Taskforce, Anciaux moved to adjourn, and Vandenberg seconded. The meeting was adjourned at 6:30 p.m. Assessing Strategies for Scattered Site Housing in Iowa City, Iowa Prepared/or: Community and Economic Development Division City of Iowa City Prepared by: Amanda Cline, Alexis Kuklenski, Tracy Glaesemann, and Luke Pelz Field Problems in Planning 11102:210 Graduate Program in Urban and Regional Planning University of Iowa 10 May 2005 Assessing Strategies for Scattered Site Housing in Iowa City, Iowa Prepared for: Community and Economic Development Division City of Iowa City Prepared by: Amanda Cline, Alexis Kuklenski, Tracy Glaesemann, and Luke Pelz Field Problems in Planning II 102:210 Graduate Program in Urban and Regional Planning University of Iowa 19 April 2005 Acknowledgements We would like to thank the Iowa City Scattered Site Housing Task Force for their help and openness to our involvement in this process. They have dedicated many hours and consideration to their charge, and were not required to be so willing to work with us as well. Steven Nasby, Stephen Rackis, Maryann Dennis, Charlie Eastham, and Jerry Anthony have been especially helpful in providing data and insight into the issues surrounding affordable housing. We greatly appreciate the help and guidance Steven Nasby has provided through his supervisory role. Heather MacDonald has been pivotal in keeping us focused and helping us create a better prod uct. Table of Contents Executive Summary............................................................................................................. i Goal of the Report....................................................................................................................... 2 Community Profile.............................................................................................................. 3 Table 1: Largest Iowa City Area Employers ......................................................................3 Graph 1: Fair Market Rent in Iowa City 2000-2004...........................................................4 Graph 2: Comparison Minimum Wage to Housing Wage .............................................5 Graph 3: Median Wages in Iowa City for Select Occupations.....................................6 Table 2: Commuting Patterns and Housing Costs by County .......................................7 Table 3: Free/reduced Lunch Eligibility by Elementary School, 2003-04......................8 Scattered Site Housing Task Force ..................................................................................... 9 Defining and Measuring Concentration .................. ............................... ........................... 12 Measures of Concentration ........................................................................................................ 12 Task Force Measure.. .......... ............. ........................................... ......... ...... ........ ............. ........... 13 Dispersal Techniques........................................................... ........... .................................. 14 Inclusionary Zoning.. ............................ ............. .................. .......... ............ ............. ............. ...... 14 Application to Iowa City ........................................................................................................ 17 Table 4: Iowa City Residential Permits 1994-2004...........................................................17 Table 5: Iowa City Affordable Housing Units if 15% Inclusionary Zoning.....................18 Map 1: Building Permit Distribution ....................................................................................19 Fair Share Housing ................... ................................................................................................. 19 Application to Iowa City ........................................................................................................21 Table 6: Fair Share Housing Analysis by Rental Units v. All Occupied Units................24 Moving to Opportunity ..............................................................................................................25 Application to Iowa City ........................................... ............................................................. 27 Table 7: Poverty Rates, Voucher Use, and Rental Units in Iowa City..........................28 Housing Consortiums............... ................ ............... ......... ................ .......... ............ ................... 29 Application to Iowa City........................................................................................................ 30 Table 8: Population, Income, and Housing Data for Greater Iowa City Area..........31 Task Force Recommendations. ............................................. ......... .............. .............. ....... 32 Summary of Recomlnendations ... ..... ...... ..... ............ ............ ... ..... ..... ........ ..... ..... .......... ..... ..... ... 32 Task Force Matrix........... ........ ...................................... ............................ .......... .......... ............. 32 Implications of Task Force Recommendations..........................................................................32 Future development of new assisted housing would be concentrated in a few block groups. 32 Map 2: Implications of Task Force Draft Recommendations.......................................33 Unintended impacts could be realized if recommendations are not adopted as a whole. ...... 33 Effective moratorium may occur. .......................................................................................... 34 Land prices will affect development. ..................................................................................... 34 Residency preference ineffective. .......................................................................................... 35 Limiting rehabilitation opportunities. .................................................................................... 35 Limitations of unit of analysis................................................................................................ 35 Study Analysis .................................................................... .............................................. 36 Map 3: Site Suitability Analysis ...... ........ ............ ............... ........... ............................... .........38 Study Recommendations........................................................................................... ...... 40 Include both residents of assisted housing and developers in the process. ................................ 40 Take the distribution of residential housing into account when defining concentration. .......... 40 Consider more than just assisted housing placement in dispersal policy. ................................. 41 Change the zoning code. ............................................................................................................ 41 Map 4: Rezone Developable Land To Encourage Affordable Housing ....................42 Develop an effective inelusionary zoning policy....................................................................... 42 Develop a Housing Linkage Fee Program .................................................................................43 Explore ways to use current funds more efficiently.................................................................. 44 Appendix A: Task Force Draft Recommendations.......................................................... 45 Appendix B: Site Suitabil ity Analysis Index............ ............................ ................. .......... 46 Table A: Block groups within Iowa City and the Index Score ......................................48 Appendix C: Distribution of Subsidized Housing ........................................................... 49 Map 5: Distribution of Subsidized Housing........................................................................49 Appendix E: Annotated B ibl iography ...................... ...................... .................... ............. 50 Inclusionary Zoning.. ........... ..... ............ ............. ........ .... .......... ...... ............. .......... ... ....... ........ ... 50 Housing Consorti urns ....... ............ ................................. ............... .............. ...... ....... ........... ....... 55 Moving to Opportunity (MTO).................................................................................................. 59 Fair Share Housing .................................................................................................................... 6 I Defining & Measuring Spatial Concentration ........................................................................... 64 Appendix F: References................................................................................................... 69 Tables Table 1: Largest Iowa City Area Employers .................................................................................3 Table 2: Commuting Patterns and Housing Costs by County...................................................7 Table 3: Free/reduced Lunch Eligibility by Elementary School, 2003-04.................................8 Table 4: Iowa City Residential Permits 1994-2004......................................................................17 Table 5: Iowa City Affordable Housing Units if 15% Inclusionary Zoning ................................18 Table 6: Fair Share Housing Analysis by Rental Units v. All Occupied Units...........................24 Table 7: Poverty Rates, Voucher Use, and Rental Units in Iowa City .....................................28 Table 8: Population, Income, and Housing Data for Greater Iowa City Area .....................31 Table A: Block groups within Iowa City and the Index Score .................................................48 Graphs Graph 1: Fair Market Rent in Iowa City 2000-2004......................................................................4 Graph 2: Comparison Minimum Wage to Housing Wage ........................................................5 Graph 3: Median Wages in Iowa City for Select Occupations................................................6 Maps Map 1: Building Permit Distribution ...............................................................................................19 Map 2: Implications of Task Force Draft Recommendations..................................................33 Map 3: Site Suitability Analysis.......................................................................................................38 Map 4: Rezone Developable Land To Encourage Affordable Housing ...............................42 Map 5: Distribution of Subsidized Housing...................................................................................49 EXECUTIVE SUMMARY A fair and even distribution of assisted and affordable housing has been a concern of communities nationwide for many years. The general motivations for such a goal is twofold, to alleviate social ills thought to be caused by concentrations of those in poverty, and to increase the chances of upward mobility for the impoverished. The Iowa City City Council recently appointed a task force to examine the type, distribution, and location of assisted housing in Iowa City and to assess whether policies are needed for the placement of future assisted housing in Iowa City. This report reviews the process and recommendations of the Iowa City Scattered Site Housing Task Force (referred to as the Task Force), examines dispersal techniques used by other communities, and discusses their application to Iowa City. The Task Force, formed in April of2004, devoted their initial meetings to gathering data as well as thoughts, opinions, and suggestions by various interest groups in Iowa City. These groups included city staff-both from the Planning and Community Development Department and the Housing Authority-developers of assisted housing, market-rate home builders, and Iowa City residents. The Task Force is composed of representatives from the school district, Neighborhood Council, Johnson County, human service organizations, the Planning and Zoning Commission, and the Housing and Community Development Commission. While seeking input from myriad interest groups is commendable, an important viewpoint was missing throughout the process: that of the residents of assisted housing. While the two public hearings that were held provided opportunities for residents to share their opinions and viewpoints with the Task Force, residents of assisted housing were neither invited to sit on the Task Force nor to present. Inclusion of all stakeholders of a potential policy in the process is critical to its success. Including an assisted housing resident could prove beneficial by providing thoughts and experiences that otherwise were only gleaned through stories and supposition. While residential developers-both market rate and affordable housing developers-were invited to present to the Task Force, the process could benefit from greater involvement of this group. The intricate knowledge they have of the process of such development is crucial to crafting policy. It is important that both residents of assisted housing and developers be included in the process as it moves forward. Defining what constitutes a 'concentration' is essential to determining if a concentration of assisted housing exists in the community. There are various methods of measuring a concentration, ranging from complex to relatively simple. The Task Force defined concentration as a block group having more than their fair share of assisted housing. Their definition of fair share is based on the premise that assisted housing be distributed evenly throughout Iowa City at the block group level. In other words, since Iowa City has I, I 50 assisted units and there are 3 I block groups, each block group should include 37 units. Thus, the Task Force identified block groups with more than 37 units as having a concentration. This method does not take into consideration the distribution of residential housing in Iowa City. There are various techniques used to disperse assisted housing, ranging from place-based methods, such as inclusionary zoning and fair share, to people-based programs such as the Moving to Opportunity demonstration program. The Task Force suggests using a fair share method for dispersing assisted housing, using incentives above and beyond current funding option to encourage assisted and affordable housing development in block groups that have not reached their fair share. If the supply of assisted housing does not decrease, they also recommend removing support for developing assisted housing in those block groups with more than their fair share. Other policy recommendations include a campaign to educate all residents on the importance of the issues the Task Force has been discussing, encouraging a more regional approach to affordable housing issues, and adjusting zoning and development regulations to more easily accommodate affordable housing in all block groups. The Task Force fair share analysis takes into account only the location of assisted housing units. The matrix does not consider any of the other characteristics of the community that are inter- related to the location of assisted housing, such as poverty rates, the availability of rental housing, the cost of land, gross rents, and the amount of developable land. An impact of this is that the majority of developable land in Iowa City is in block groups not recommended for future development by the Task Force. It is also important to note that rehabilitation of existing buildings can occur within all of the twenty-four recommended block groups. As an alternative, we have conducted a site suitability analysis that takes into account barriers to the development of assisted housing and where low-income populations currently reside. The goal in constructing the site suitability analysis was to provide a more comprehensive picture of the combined effects of poverty, land values, land availability, rents, and subsidized housing. II The block groups identified in our analysis differ from those identified by the Task Force as the target for incentives and development. The Task Force recommends adopting an inclusionary zoning policy that would provide incentives for residential developers to include assisted housing in each of their future developments. However, they do not recommend requiring developers to include assisted units, rather it would be on a voluntary basis. In order to combat the market forces that have thus far worked to concentrate assisted housing and effectively scatter future development, the incentives offered need to be significant. Calculating effective incentives to change developers' behavior (whether density bonuses, a speedy approval processes, or various other options) would be both time-consuming and costly. Although a voluntary policy may be less politically contentious, in the long run a mandatory inclusionary policy may more effectively serve the community. We agree with the Task Force that the current zoning code creates obstacles for developing assisted and affordable housing in all areas of the community. The City is currently redesigning the code, and we encourage the decision makers to consider changes that would encourage, rather than deter, affordable housing such as allowing for greater density development, performance guidelines, and form-based approaches. The Task Force recommends that the City increase opportunities for affordable housing throughout Iowa City. We agree with this. As the affordable housing stock becomes more plentiful, the need for assisted housing decreases. However, budgets for both affordable and assisted housing development are stressed. Oftentimes the best intentions of decision-makers are thwarted due to a lack of funding. We offer two strategies for funding affordable and assisted housing strategies: using current funding options more effectively, and developing a new funding source such as a housing linkage fee. Oftentimes federal funds such as CDBO and HOME are awarded as grants. While seemingly generous, this is perhaps not the most effective use offunds. By awarding low-interest or deferred loans, affordable and assisted housing that would not happen if solely at the mercy of market forces can still be produced, yet by recycling monies, a city can create a more sustainable funding source that can act as a safeguard to federal cutbacks. Creating a housing linkage fee is one way of creating a new dedicated funding source for assisted and affordable housing. The fee could be on a square-foot basis and collected at the time of the permit issuance. While the actual fee would need to be dependant on the impact of housing III development and calculated in a defensible manner, we offer the following hypothetical example. According the Wall Street Journal, the average home built in the United States in 2002 was 2,320 square feet. Ifa linkage fee of$.08 per square foot was established, this would add $186 per home the size of the national average in 2002. Considering that the average number of single- family permits issued in Iowa City between 2000 and 2004 is 124, $23,000 per year could have been generated. These funds could be funneled to an entity such as the Johnson County Housing Trust Fund to be used for development of assisted and affordable housing in Iowa City. IV INTRODUCTION Many have argued that the geographic distribution of subsidized housing in the United States has significantly contributed to the concentration of poverty (Goetz, 2003). Concerns with decreasing property values, an increase in crime, decay of physical infrastructure, an increase in drug dealing and abuse, and the lack of positive role models for children have all been arguments for not locating place-based subsidized housing-housing receiving financial subsidy for operation or rental assistance-in a particular neighborhood. In some instances the concerns are valid, in others the concerns arise from the stigma and myths that surround subsidized housing and its occupants. The analysis of subsidized housing concentration is an important step in identifying the extent of the impact subsidized housing has had on the previously mentioned concerns. If a concentration of subsidized housing is found to cause social problems in a community, strategies, policy recommendations, and resources can be better focused to alleviate these problems. Most often, the effects of subsidized housing on neighborhoods have been described in four related but conceptually distinct ways (Freeman, 2002). The first is that the location of subsidized housing will reduce the value of surrounding properties. Second, the racial composition of the neighborhood will change causing a concentration of minority residents. Third, poverty rates will increase in the neighborhood of the subsidized housing and in surrounding neighborhoods. And finally, it is argued that subsidized housing will serve as a hot spot for criminal activity and spread throughout adjacent neighborhoods. There are six published studies that directly measure the impact of concentrated public housing on the racial and poverty characteristics of communities (Goetz, 1999). Four of the six studies confirm the correlations between subsidized housing, and racial transition and poverty rates of the community. Two studies found no significant correlation between subsidized housing, race, poverty, and non-low income families moving out of an area containing subsidized housing. Research on the impact of the concentration of subsidized housing is still growing, providing cause for further exploration of its effects. No specific study has comprehensively examined this topic within Iowa City. This is not the first time the topic of assisted housing distribution within Iowa City has come to the forefront of City discussions with strong proponents and opponents. Through the Task Force, decision makers have taken the initiative to develop a forum surrounding these issues and will have the opportunity to respond. Our role in this project is to present options to address these issues that speak to the concerns of both sides and to offer strategies to avoid future conflicts. Goal of the Report The primary purpose of this report is to conduct an objective assessment of scattered site housing in Iowa City, IA. The assessment wi\l comprise of three distinct sections: · Defining and Measuring Concentration. This section details the common spatial measures that are used in social research and offers an alternative to the measure chosen by the Iowa City Scattered Site Housing Task Force (referred to as The Task Force throughout this report), a site suitability analysis. · Scattered Site Alternatives. This section reviews scattered site housing policy alternatives in the context of Iowa City. The topics discussed are inclusionary zoning, the Moving- To-Opportunity demonstration program, fair share housing, and housing consorti urns. · Findings and Recommendations. The Task Force findings and their implications are summarized and discussed. Finally, our study recommendations from this study are presented for the development offuture placed-based subsidized housing in Iowa City. The focus of this report is on the concentration of private and public place-based subsidized housing as opposed to tenant-based subsidized housing (also known as the Section 8 Housing Choice Voucher Program), where subsidy is provided to the individual or family to use towards a market-rate housing unit of their choice in any neighborhood throughout the city. The reason for the distinction is that place-based subsidized housing has been the focus of the Task Force deliberations. Note: For the purposes of this analysis, assisted housing and subsidized housing are used interchangeably to refer to rental housing built with government funds. Affordable housing refers to housing where the resident pays less than 30% of their monthly income in housing costs; it mayor may not be subsidized. 2 COMMUNITY PROFILE Iowa City, a community of 62,220 (Community Profile for the Iowa City Area, 2004), is nestled alongside the Iowa River in eastern Iowa. The city is perhaps most widely recognized as the home of the University ofIowa, which affects the character of the community in a number of ways. With a median age of 25, the Iowa City Metropolitan Statistical Area (MSA) is much younger than the state as a whole, which has a median age of 37. Iowa City residents, on average, have higher levels of education than the state of Iowa. Over half (54%) of Iowa City residents have a bachelor's degree or higher, compared to just 17% throughout all of Iowa (Community Profile for the Iowa City Area, 2004). The job and housing markets are also influenced by the presence of the University. The University and its associated hospitals are the biggest employers in the area, employing over 23,000 people (Community Profile for the Iowa City Area, 2004). Major employers of the area are listed in Table 1. Table 1: Largest Iowa City Area Employers Employer University of Iowa University ofIowa Hospitals and Clinics ACT, Inc. Pearson rviercx. ~ospital Veterans Affairs Medical Center Iowa City Community School District Hy-Vee Lear Corporation Rockwell Collins City of Iowa City Wal-mart Proctor & Gamble MCI Mass Markets Oral B Laboratories Source: Iowa City Community Profile, 2004 Number of employees 16,495 7,113 1,340 1,300 1 1,232 I, I 00 927 850 673 620 563 550 540 500 The steady supply of students helps keep the rental market in Iowa City very tight. In 2000, the vacancy rate in the Iowa City MSA was 3.8%, compared with 6.8% for Iowa as a whole. At that time, the median gross rent in Iowa City was $564, comparing favorably to the HUD-calculated 3 fair market rent (FMR) for two-bedroom units of$582 (NLIHC, Out of Reach 2000). For comparison, the median gross rent for the state at that time was $470 (US Census 2000). Using the federal standard of affordable housing, defined as housing that requires households to spend no more than 30% of their monthly income on housing costs, the rental stock in Iowa City is affordable to a family with the median income. The median family income in 1999 in the Iowa City MSA was $60,112 (US Censes 2000). Based on this figure, 30% of the median monthly income is $1 ,503-well over the median gross rent ($564). However, by definition, half of the nearly 24,000 families in Iowa City have incomes below the median. Five percent of families in Iowa City were in poverty in the 2000 Census. This equates to just over 1,200 families. More than 800 families (or 3.5%) earned incomes less than $10,000. For families in poverty (earning less than 30% the Area Median Income, or AMI), FMR is out of reach. As illustrated in Graph 1, the gap between monthly rents affordable to those in poverty and the FMR hovered around $100 between 2000 and 2004, reaching as high as $124 in 2002 (NLIHC, Out of Reach 2000-2004). Graph 1: Fair Market Rent in Iowa City 2000-2004 $680 Fair Market Rent for Two Bedroom Iowa City MSA 2000-2004 $610 $615 $648 $582 $597 -II . . . . .a. .a. .a. .a. .a. $524 $541 $474 $476 $486 $580 $480 $380 $280 $80 $108 $121 $124 $91 $107 e - - - - - - - . - - . - . . - . - - -. - ·e . . . . . - . . - - - . - - - . - - . - . ·e. - - . _ . . _ . . . _ _ _ . . . _ _ _ . .. _. . . _ _ _ . _ _ . . . . _. . _ _ _ _ -e $180 2000 2001 2002 2003 2004 ---e--- Gap I -- Fair Market Rent ---.- Rent affordable to 30% Area Median Income Source: NLIHC, Out of Reach Reports, 2000-2004 An underlying reason that some families are not able to afford the housing available is wages. A 4 worker earning minimum wage ($5.15) and working 40 hours a week can afford monthly rent of no more than $268 (NLlHC, Out of Reach, 2004). This is well below the FMR for a two- bedroom unit of $648 in 2004. To be able to afford the FMR, a minimum wage earner must work 97 hours per week. Another way to look at this relationship is the wage that must be earned in a 40-hour workweek to afford the FMR for a two-bedroom unit. This is called the housing wage. In 2004, the housing wage was $12.46 in Iowa City, an 11 % increase from 2000. In that time, minimum wage has been stagnant, as shown in Graph 2. One way to put this into context is that the gap between the minimum wage and the housing wage is greater than the minimum wage itself. Graph 2: Comparison Minimum Wage to Housing Wage Comparison of Minimum Wage to Housing Wage Iowa City MSA 2000-2004 $15 $11.48 $11.73 $11.83 $11.19 . . . . $10 $12.46 . $5 $7.31 $6.04 $6.33 $6.58 $6.68.. . . .. __ . .. . .. .. . __ . .. ............... ...... ..................................................      $5.15 $5.15 $5.15 $5.15 $5.15 $0 "' 2000 2001 2002 2003 2004 ....... Wage gap ---- Wage needed to afford FMR Source: NLfHc, Out of Reach Reports, 2000·2004 --...- Minimum Wage According to a 2003 Iowa Workforce Development wage survey updated for the first quarter of 2004 using and Employment Cost Index, the median wage of all non-farm occupations in Iowa City for 2004 was $14.13. This is above the housing wage of$12.46. Occupations such as child care and food preparation, however, fall well below the housing wage with median wages less than $8 per hour. Graph 3 illustrates these relationships as well as median wages for other selected occupations. 5 Graph 3: Median Wages in Iowa City for Select Occupations Comparison of Minimum and Housing Wages to Median Wages in Various Occupations Iowa City, 2004 18 $17.11 16 $15.30 14 $13.33 $13.35 $1155 $14.13 $12.46 12 $11.72 10 $779 $7.13 $515 . -..",-",0 ~",,,,,o "t.,,, \""" 0°~ _ C""o .".0" 0<'- C-{",>, <}<o'''' S""" J> '?' 0<"'\~ «0 (J:.r:.;r..* '?,.\\....r.. '\. c~ -ø\~'I$. ,,~~ \'1'-1:,«' ~\<>,,< a,S"$- \\c-ç. ~o~r:, ",J>~ o,§/'" '1'-\\0'" <,,~c/G c,e,r" . ",\ s< s<<:'\ sec,\. \\....c .,~ 11- ",0''" ;$'"", co<$' o Median Wage for Vanous Occupations . Minimum & Housing Wages Noll': Hfemenlary teacher waxe L'ofcl/lated hy a.\'.\'lIminX '¡O·hollr work-weeh year-round. /Joe.I' noJ include special edllcalion teacher. SOllrCl:: Median wOJ!e.\'¡rom 20()3 10wa Workfilrce IJeve/opmenf OF,\' Wax!! ,)'urvey lI{ulcued 10 2()O'¡ wilh Emplovment Co:if Index; hOllsinJ: wax!.' (;-'(Im NLlHC Most people who work in Iowa City live in Johnson County (77.6%). However, this leaves more than one of every five workers who live outside of Johnson County. While there may be many factors that influence commuters decisions to live outside of Johnson County, one factor is housing price. Of the ten counties where the vast majority of commuters reside, none have as high of housing costs as Johnson County (Table 2). 6 Table 2: Commuting Patterns and Housing Costs by County County of residence Johnson County, IA Linn,IA Washington, IA Cedar, IA Muscatine, IA Iowa,IA Scott, IA Louisa, IA Keokuk, IA Benton Co. IA Jones Co. IA All other counties Number working in Johnson County] 54,202 4,434 2,879 2,171 1,306 1,294 325 316 299 298 290 2,067 Percent of all workers in Johnson Countyl 77.6% 6.3% 4.1% 3.1% 1.9% 1.9% 0.5% 0.5% 0.4% 0.4% 0.4% 3.0% Median gross rene $564 $510 $424 $441 $460 $412 $496 $419 $372 $385 $416 n/a Median home value2 $131,500 $99,400 $83,600 $84,600 $84,700 $85,600 $92,400 $66,600 $51,900 $82,700 $80,400 n/a Note: Table ranked by number working in Johnson County 'Source: US Census 2000, Commuter Flows 2 Source: US Census, 2000, Summary File 3 Iowa City children attend schools in The Iowa City Community School District (ICCSD). The ICCSD serves about 11,000 students from Iowa City and the nearby towns of Coralville, North Liberty, University Heights, and Hills. It encompasses 17 elementary schools, two junior highs, two high schools, and one alternative school (ICCSD website, 2005). Of the 5,815 elementary students, 1,472 (or 25.3%) are eligible for free and reduced lunch (FRL). However, students eligible for FRL are not distributed evenly among the elementary schools. Nearly 70% of students at Mark Twain qualify for FRL, compared to less than 2% at Shimek (IA Dept. of Education, Basic Education Data Survey). This data, and those discussed below, are displayed in Table 3. While the proportion of students eligible for FRL has been increasing slowly, some schools have experienced much greater increases since the 2000-01 school year. For instance, district wide, the proportion of students eligible for FRL increased by 2.4 percentage points (from 22.9% to 25.3%). Four elementary schools-Twain, Kirkwook, Roosevelt, and Wood-experienced increases in excess of IO percentage points. At the same time, five schools-Lincoln, Shimek, Hoover, Lemme, and Horn-experienced decreases. 7 Table 3: Free/reduced Lunch Eligibility by Elementary School, 2003-04 Elementary School Mark Twain Hills Roosevelt Grant Wood Horace Mann Kirkwood Robert Lucas Central Longfellow Penn Helen Lemme Irving Weber Herbert Hoover Ernest Horn Wickham Lincoln Bohumil Shimek Enrollment Percentage eligible Number eligible for for free/reduced free/reduced lunch lunch 146 67.9% 90 55.7% 117 44.3% 172 41.2% 86 39.9% 103 37.5% 59 30.2% 94 26.6% 81 21.2% 114 20.3% 64 19.9% 93 13.7% 30 11.9% 16 7.9% 31 4.8% 10 3.6% 3 1. 7% Percentage point increase from 2000-01 16.3 9.2 10.4 10.6 4.9 16.4 2.5 6.6 1.7 0.4 -1.1 5.5 -2.2 -I.I 0.4 -8.0 -6.8 315 194 253 434 273 373 398 429 293 458 281 496 278 316 540 249 235 Note: Table ranked by percentage eligible for free/reduced lunch. Source: Iowa Department of Education, Basic Education Data Survey 8 SCATTERED SITE HOUSING TASK FORCE An impetus of the creation of the Scattered Site Housing Task Force was a letter from the Iowa City Community School District to City Council (ICCSD) in November of2003. The School District's concern was that the location of assisted homes affects some schools more than others. The district believes that low-income students require more resources than their more affluent counterparts, feeding concerns that concentrations of low income housing within one elementary school attendance area create an inequitable strain on that school, its budget, and teachers. This may ultimately affect the learning environment and potentially test scores. While the issue of scattering assisted housing has been investigated in Iowa City previously, no action has been taken as a result. The letter from the ICCSD renewed the Council's interest in this issue, spurring them to create the Task Force, which they charged with looking at the type, distribution, and location of assisted housing in Iowa City and assessing whether policies are needed for the placement of future assisted housing in Iowa City. The Task Force is an eight-member citizen group representing various interests such as the: · Iowa City Community School District (ICCSD); · Neighborhood Council; · Planning & Zoning Commission; · Johnson County Board of Supervisors; · Housing & Community Development Commission; and the · United Way of Johnson County. Bi-weekly meetings began in April of2004. These preliminary meetings consisted of outside groups and individuals presenting data on a variety of topics related to housing and poverty within Iowa City. Presenters include (in alphabetical order): · Burns and Burns L.C.; · Domestic Violence Intervention Program (DYIP); · Greater Iowa City Housing Fellowship; · Habitat for Humanity; · Hawkeye Area Community Action Program (HACAP); 9 · Iowa City Community and Economic Development staff; · Iowa City Homebuilder's Association; · Iowa City Housing Authority; · Iowa City Neighborhood Council; · Iowa City Urban Planning staff; · Iowa Valley Habitat for Humanity; · Mid-Eastern Council on Chemical Abuse (MECCA); · Neighborhood Centers of Johnson County; · Shelter House; · University of Iowa Resident Services; · University of Iowa Urban and Regional Planning Department; and · Wells Fargo. Although the Iowa City Association of Realtors was invited to provide their input on Iowa City's housing market, they chose not to attend. Residents of the assisted housing units within Iowa City were not invited to present at any of the meetings, leaving a gap in the data provided to the Task Force. A public hearing was held in early October at Mark Twain Elementary School. Much of the discussion focused on the in migration of low-income individuals from Chicago, the Chicago Public School System, and the race of low-income residents. Teaching staff from Mark Twain Elementary offered examples of how their teaching is affected by the high number of low-income students and the services required for them. Many of the residents of assisted housing felt there were two issues at hand, the negative perception of low-income households and the continual concentration oflow-income housing in specific areas of the city. The residents believe that housing can not be deconcentrated without first addressing the inaccurate perceptions held by the general public about its residents. Deliberations began on October 18,2004. The main question of what constitutes a concentration guided discussion throughout deliberations. The factors discussed as key to determining a concentration include: . Impacts of different "groups" . Elderly . Disabled . Low-income family 10 · Transitional populations · Test scores · Social services · Poverty status · Crime data · Home values · Free and reduced lunch program · Assisted housing inventory While all of these indicators have been discussed, the Task Force is focusing on distribution of place- based assisted housing. The Task Force presented their ideas and recommendations in draft form at the public hearing on March 28, 2005. The Task Force is currently revising their recommendations and will present a revised version to City Council in the coming months. I 1 DEFINING AND MEASURING CONCENTRA nON Economic and social disadvantage are not evenly distributed geographically. Strong arguments have been made that disadvantaged individuals who live in areas where similar people are clustered often suffer more than those who live among the more privileged groups within society (Johnston, 2003). If this holds true, and if it is suspected that the spatial distribution of publicly assisted housing is causing negative impacts, then one solution would be to implement place-based policies to scatter such housing. One of the first steps in formulating place-based policy is to identify whether there is a concentration of subsidized housing in Iowa City. Once a measurement of concentration is agreed upon, analysis of the degree and location of concentration, and its possible impacts, is more feasible. Formulating a definition of concentration assists local decision makers in focusing place-based policies more rationally and efficiently. This section of the report will focus on examining commonly used techniques for measuring distribution, discussing the measure used by the Task Force, and concluding with an example of the distribution of subsidized housing using alternative criteria to those employed by the Task Force. Measures of Concentration There are many approaches to defining and measuring the spatial distribution of social phenomenon. Although most of the techniques are used to measure the spatial distribution of poverty, they can be adapted to analyze subsidized housing. The methods used range from highly complex (i.e. using mathematical equations and Geographic Information Systems) to relatively simple (i.e. using percentage thresholds). Examples of measures that could be applied in identifying the spatial distribution of subsidized housing include the following. · The location quotient measures the proportion of subsidized housing to total rental or all housing in a census tract or block group. · Concentration indices measure the relative amount of land occupied by the subsidized housing units within the city boundary. · Clustering is similar to the measure of concentration and calculates the degree to which subsidized housing is clustered in a given geographic area. 12 . Measures of evenness calculate the degree to which subsidized rental housing is unevenly distributed throughout the city. . The threshold profiles technique is based on a concentration profile that identifies the degree to which subsidized housing is concentrated according to a range of thresholds. The benefits of using these measures are that they provide a spatially defined understanding of the issue. What they cannot do is take into account the factors that cause the pattern, the degree of the negative or positive impacts, and the other factors that contribute to the distribution. The techniques should be supplemented with a larger comprehensive study. We recommend a site suitability analysis that takes into account all of these factors, which is discussed in more detail in the Study Analysis portion of this document. Task Force Measure The Task Force measure is unique to the measures discussed above, though most similar to measures of evenness. They created a fair share matrix based on the premise that assisted housing be distributed evenly throughout Iowa City at the block group level. In other words, since Iowa City has 1,150 assisted units and there are 31 block groups, each block group should include 37 units. If a block group had greater than 37 units, it had a concentration. The Task Force matrix can be found in Appendix A. 13 DISPERSAL TECHNIQUES This section describes an array of approaches communities have taken to encourage the dispersal of assisted and affordable housing. The four techniques discussed are inclusionary zoning, the people-based demonstration project called Moving to Opportunity, housing consortiums, and fair share housing. Inelusionarv Zonin2 The development of affordable housing is not keeping pace with job growth and family formation across the United States. Across the nation hundreds of communities are combating this issue by developing inclusionary zoning ordinances. Historically, there has been no equivalent to inclusionary zoning that enables a community to retain its character while accommodating affordable housing. Adopting an inclusionary zoning program does not require basic zoning ordinances to be altered significantly; the standards that govern development remain intact. Inclusionary zoning is a method used to integrate affordable housing into all new residential developments in a community. There are two general types: voluntary and mandatory. Both mandatory and voluntary programs provide incentives to developers to encourage/supplement their construction of affordable units. Mandatory incIusionary zoning programs require developers to make a percentage of their units in new housing developments affordable to low- and moderate-income households or pay in lieu fees dedicated to building affordable housing. In contrast, voluntary programs only provide incentives to developers to spur their involvement in the creation of affordable housing units. The first inclusionary zoning ordinance was developed in Fairfax County, VA in 1971. The ordinance required developers of more than 50 multi-family units to provide 15 percent of their units within an affordable range (Brunick, 2003). The requirement was overturned by the Virginia Supreme Court in 1973, and was ruled a "taking"l. A land use decision is a "taking" when courts decide that land use regulations are excessively restrictive, so that government has unconstitutionally "taken" land without just compensation. Changes in the U.S. Supreme Court's interpretation of this issue have made it advisable to conduct studies to document why I "There is a taking of property when government action directly interferes with or substantially disturbs the owner's use and enjoyment of the property." Brothers v. us. ,594 F.2d 740, 741-42 (1979). "A taking is affected if the application of a zoning law denies a property owner of economically viable use of his land. This can consist of preventing the best use of the land or extinguishing a fundamental attribute of ownership." V ari-Build, Inc. v. City of Reno, 596 F.Supp 673, 679 (1984). 14 and to what extent inclusionary zoning programs are necessary - in other words, to determine the "rational nexus" between the problem and the proposed solution. The most important consideration, because it is so often overlooked, is how inclusionary housing programs are implemented. Carefully drafted local decisions, effective monitoring systems and the legal protection for long-term affordability are key elements of a program's success. The longest running inclusionary zoning program was developed in 1973 in Montgomery County, MD. The ordinance was instituted countywide and is still being used today to encourage affordable housing development (Brown, 2001). Inclusionary zoning programs have been implemented in cities of varying size, all with positive results. A typical inclusionary zoning ordinance establishes a minimum percentage of units affordable to households at a particular income level to be provided in specific types of residential developments. The income level is generally defined as a percentage of the median income in the area. The goal of this process is to establish a relatively permanent stock of affordable housing units provided by the private market that keeps pace with overall growth (Porter, 2003). Inclusionary zoning creates economically diverse communities and allows the local government to mitigate economic segregation. Low- and moderate-income housing is provided in mixed-income developments, alongside market rate housing. The integration of mixed-income housing avoids the problems of over-concentration, ghettoization, and stigmatization generally associated with isolated affordable housing efforts (Burchell and Galley, 2000). An example of how inclusionary zoning has been successfully implemented is the case of Highland Park, IL. The City of Highland Park, IL (population 32,000) approved an inclusionary zoning ordinance in 2003 to combat the rapid decline in affordable housing. The median household income for Highland Park residents is $157,861. However, 80 percent of the locally employed working in the retail and service sectors have an average annual salary of less than $35,000 (Ross, 2003). The new regulations for the Highland Park program apply to all residential developments with five or more units, which are required to set aside 20 percent for affordable units. Developers participating in the program become eligible for a variety of incentives, including fee waivers, and can also take advantage of a density bonus granting one additional market-rate unit per affordable unit provided (Ross, 2003). While the City prefers that affordable units be constructed on-site, developers of smaller single-family projects may opt out by making cash payments of $1 00,000 per affordable unit to a housing trust fund. The payment represents the cost to the developer of making a market-rate unit affordable. To determine 15 the in lieu fee for Iowa City, sum the purchase price of a two-bedroom affordable unit ($88,000)2 and the down payment assistance ($5,000) and subtract it from the cost of the lowest priced new two-bedroom, owner-occupied unit ($110,000). The in lieu fee in Iowa City would equal approximately $17,000, much less than the Highland Park fee. For-sale units created by the inclusionary ordinance are often maintained as affordable in perpetuity or as long as is legally permissible. In many cases, rental units must be kept affordable for 25 years; often administered by the Housing Authority. The City typically ensures permanent affordability through a development agreement and restrictive covenants or other related instruments that run with the property. Among other things, such covenants include a resale formula designed to provide a fair return to owners of inclusionary units while at the same time ensuring that the units will be resold at a price affordable to future income-qualified buyers (Highland Park Zoning Ordinance, 2003). As a proven market-driven technique, inclusionary zoning is able to create affordable housing without large amounts of public subsidy because it relies on a strong residential market to create below-market units. Many opponents of inclusionary zoning assert that developers cannot make money on affordable housing and are burdened with integrating economically diverse neighborhoods that have been demographically homogeneous for decades. But according to the National Association of Home Builders, "most inclusionary zoning laws do not completely deprive the developers of a reasonable economic use and often seek to provide incentive and bonuses as partial compensation" (Innovative Housing Institute, 2004). In an incentive-based zoning program a residential developer builds pursuant to a special permit. Typically, the developer receives increases in density and/or reductions in regulatory requirements such as parking fee waivers, in exchange for providing affordable housing. Longmont, CO, located 40 miles outside of Denver, provides an option to developers for in-lieu-of payments that the city uses to develop affordable housing. Developers in the Longmont program are also eligible for cost offsets, including smaller setback requirements and reduced parking requirements (Porter, 2003). The current inclusionary zoning proposal in Brooklyn, NY allows developers to develop 18 percent more square feet in exchange for setting aside 15 to 25 percent of their units for low-income persons. Developers are given a choice of how to meet the requirement either by building the low-cost units within their market rate complexes, or 2 Using the Fannie Mae True Cost Calculator, data was entered for an individual with a yearly income of$30,000, a monthly debt of $100, a $500 downpayment, and a 6% loan for 30 years. With these details an affordable home in Iowa City would cost $88,000. 16 paying an in lieu fee. A large incentive for developers to comply with the inclusionary zoning proposal is their ability to take advantage of other incentives, such as increased building height, parking, and set-back standards, in addition to the right to increase the density of their developments (Cardwell, 2004). Density bonuses allow developers to build higher density housing than permissible by zoning regulations (e.g. building townhouses in single-family zones). Furthermore, creative and attractive community design can overcome any remaining adverse density impact (Brown, 2001). With appropriate density bonuses, the affordable units should not impose costs on the developer, and will likely lead to additional profit (Innovative Housing Institute, 2004). Application to Iowa City Since 1994, Iowa City has issued over 4,500 building permits for residential buildings, including single- family, duplex, multi-family, and mixed-use (Table 4). If the City of Iowa City had approved an inclusionary zoning program in 1994, calling for a set-aside of 15% of all residential units for affordable housing, the city would have built over 700 affordable units (Table 5). Table 4: Iowa City Residential Permits 1994-2004 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Total Single Family Number af permits 206 149 90 I 10 154 209 139 129 148 193 149 1,676 Duplex Number af permits 14 8 14 13 16 22 13 17 17 30 26 380 Multiple Units Number afpermits 28 14 19 24 15 13 22 27 45 36 27 270 Number af buildings 35 15 19 24 15 13 22 24 38 31 24 260 Number af units 335 166 218 185 97 152 267 310 402 486 220 2,838 Mixed Use (commercial/residential) Number af permits 4 4 Number af buildings 3 3 Number af units 17 17 Total units 4,911 Source: City ofIowa City Housing and Inspection Services 17 Table 5: Iowa City Affordable Housing Units if 15% Inclusionary Zoning 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Total Single Family Number of permits 31 22 14 17 23 31 21 19 22 29 22 251 Duplex Number of permits 2 2 2 2 3 2 3 3 5 4 57 Multiple Units Number of units 50 25 33 28 15 23 40 47 60 73 33 426 Mixed Use (commercial/residential) Number of units 3 3 Total assisted units 737 Source: City ofIowa City Housing and Inspection Services Although residential building permits have been issued for developments throughout Iowa City, a large majority of the permits issued from 1990 to 2003 were distributed throughout census tracts 4, 18, and 105 (Map 1). If an inelusionary zoning program were adopted without distinguishing among block groups, a majority of the new affordable housing would be located in census tracts 4, 18, and 105 - areas which already have their fair share of affordable housing according to the Task Force concentration measure. However, building permits were also issued for census tracts with a less than average share ofIowa City's affordable housing (census tracts 1,5, 15, 13, 14), illustrating that affordable housing could be scattered effectively with an inclusionary zoning policy that distinguished among small local areas. 18 Map 1: Building Permit Distribution Building Permit Distribution Iowa City, IA e 1.1 -'"' -¡ " þt'~ í ,,~ "- ~ .t..":# ....J ". r.... .... D City Boundary _ Building Permits Issued 2000-2003 _ Building Permits Issued 1990-1999 ()~t..l $our<:e HPL C~;n"'Ul City of IO""J¡ Citi Pt10log Dcpan.mC':1')t o 0.20.4 0.11 1.2 Mil.. I II I I I I Fair Share Housinl!: Fair share housing programs determine where within a given area low- and moderate-income units should be built based on where need is greatest, where housing opportunities will expand, and where it is most suitable. The goal offair share housing policies is to enhance the mobility of poor individuals (Connerly, 1996). Fair share housing is most commonly used at the state or regional level to try to achieve an even distribution of affordable housing across municipalities. If Iowa City were to adopt this type of policy, the City would be redistributing the housing within its administrative boundaries (e.g. census tracts or blocks groups). In addition to assigning a fair share target for each area, the City would need to zone or re-zone undeveloped land in such a way as to ensure that the fair share of affordable housing could be 19 located within each block group. A proactive stance the City that encouraged affordable housing would help to promote acceptance by neighborhood residents. Fair share housing gained its legal precedent in the New Jersey case, Mount Laurel I (1975). The final ruling in that case and in Mount Laurel II (1983) established that each locality has an obligation to provide low- and moderate- income housing based on several factors, one being their growth rate (Dodge 2002). In addition, localities need to develop a firm plan for how to meet their need for this type of housing. Should a town choose not to comply, the court can step in and grant developers the right to build affordable housing without the locality's approval, referred to as the "builders remedy" (Mallach, 2004). These cases led to the creation of the New Jersey Council on Affordable Housing (COAH). The COAH is responsible for identifying the housing regions within the state, the overall need for affordable housing within each region and the specific amount of affordable housing each town and village is to provide for within their boundaries. However, jurisdictions are not required to develop the recommended amount. The consequence of allowing fewer units than the prescribed amount is an increased chance that a developer will be granted a builders remedy if they challenge the municipality. The COAH is involved in the approval of all municipal affordable housing plans. It is through their requirement that all developable land be zoned under the assumption that 20% of the units will be set aside for very low and low-income residents and have a minimum density of 6 units per acre that the COAH is able to ensure that adequate land is available for affordable housing (Connerly, 1996). New Jersey set the precedent for fair share housing allocation, but the issue has been dealt with in a variety of ways in other states. California's fair share is determined by the existing and predicted demand for housing, and by efforts to disperse low-income households (Connerly, 1996). The state assigns each community its share of the regional need for affordable housing based on market demand, employment opportunities, commuting patterns, and availability of suitable sites and public facilities within the community. The state requires that each local government include their housing apportionment plan (commonly referred to as the housing element) as part of their comprehensive plan, with which all government actions must be consistent. This gives the housing element the force oflaw (Connerly, 1996). The locality's housing element shows how they plan to accommodate all of the state mandated Iow- to moderate-income units; each locality need not provide the mandated units, they need only have enough land zoned appropriately so the units could reasonably be constructed. Enforcement depends on affordable housing advocates, who are expected to bring legal suit when an affordable development is 20 unreasonably barred from an area or is faced with restrictions that would increase costs to the point that it would no longer be affordable (Connerly, 1996). Massachusetts' application of fair share is also overseen by the state, but their formula is much simpler than that of California or New Jersey. The goal in Massachusetts is to prevent localities from limiting the development of federally subsidized or state-funded housing arbitrarily. Any permit application for subsidized housing denied by the local zoning board of appeals can go straight to a state Housing Appeals Committee. The committee is in place to ensure that the locality is not arbitrarily limiting subsidized housing, be it through permit denials or conditions that would make the development infeasible. If they find either of these to be true, the Committee can override the local zoning board of appeals decision. A locality that meets anyone of the following requirements is exempt from review by a Housing Appeals Committee (Connerly, 1996): · 10% of all dwelling units are low- and moderate-income units based on the last decennial census. · 1.5% or more of the town's residentially, commercially or industrially zoned land is occupied by low- and moderate-income housing. · Approving the permit would result in the development site consisting of 0.3% of the towns publicly owned land, or 10 acres being developed within one year, whichever is greater. Massachusetts' fair share allocation is criticized for being overly simplified and somewhat arbitrary since its allocation formula is not tied to need or growth (Connerly, 1996). This method relies on developers to decide when and where it is feasible to develop affordable housing (Connerly 1996). Without developer- driven initiatives, affordable housing will not be constructed. Application to Iowa City Developing a fair share housing policy tailored to the needs of a community is a large and potentially overwhelming task. Iowa City may find that the creation of a locally mandated allocation formula that is legally defensible and practically feasible, is a daunting endeavor, requiring copious amounts of time, opportunities for revision, and public input. New Jersey's allocation formula focuses on zoning vacant land in such a way as to make the development of affordable housing possible. Adopting a similar formula in Iowa City would mean that efforts to equally distribute affordable housing would be focused along the city's fringe where developable land is available, and would not change the distribution within 21 already developed areas. Iowa City would need to develop its own plan to rezone developed land in such a way that affordable housing would be encouraged to disperse throughout the city. California's allocation attempts to create ajob/housing balance by locating the affordable housing near areas where workers' incomes qualify them for this type of housing. This minimizes commuting times and corresponding congestion. Iowa City has much lower densities than many cities found in California, keeping the jobs and residential areas fairly segregated. However, there is a regional jobs/housing balance issue, as illustrated in the commuter flow discussion in the Community Profile section of this report. One in five who work in Iowa City live outside of Johnson County. Housing, both rental and ownership opportunities, are more affordable in the ten surrounding counties where the vast majority of commuters reside. Adopting Massachusetts' general formula of encouraging affordable housing in areas where the affordable housing stock is obviously lacking would be the simplest to measure and implement in Iowa City. However, it means relying on developers to determine when and where affordable housing will be built. If Iowa City were to adopt a formula similar to Massachusetts', the focus at this time would only be on assisted housing. In addition, the definition for an over- or under-abundance of assisted housing within any given block group would need to be unique to Iowa City City Steps, the Consolidated Plan for Iowa City, has defined a concentration oflow- and moderate- income residents and minority populations by ten percentage points above the citywide average to define a concentration of low- and moderate- income and minority populations. The Consolidated Plan is a document required by HUD for the distribution of HOME and CDBG funds. Applying the measure used in City Steps to assisted housing would identify those blocks groups with concentrations of assisted housing. For example, 14.6% of all occupied units are assisted in block group 4. I, more than ten percentage points over the city average of 4.1 %, indicating a concentration in this block group. The data used would need to be updated regularly. Table 6 shows the two block groups (in bold text) that would have more than their fair share of assisted housing, when evaluated based on the entire housing stock. In their discussions, the Iowa City Scattered Site Housing Task Force has shown a preference for looking at the percentage of assisted units to rental units, changing the scope of the housing stock being considered. 22 The exclusion of owner-occupied housing in this equation skews the results because it is not representative of the whole community. It also ignores the fact that rental units are unevenly distributed among the block groups. Using both rental and owner-occupied units is a more realistic illustration of the distribution of assisted housing. A strong fair share housing policy tailored to Iowa City has the potential to encourage a more equal distribution of assisted housing throughout the city. A policy mandating that areas without their fair share of assisted housing take steps to encourage this type of housing has the potential to promote infill development and decrease sprawl by lowering the cost of developing assisted housing in these areas. If Iowa City were to choose to implement a fair share housing allocation, it would be the first of its kind in the region and would become a demonstration program for surrounding j urisdictions. If the program proves to be successful, local fair share housing formulas may become more popular in Iowa, and regional provision of fair share affordable housing may emerge. 23 Table 6: Fair Share Housing Analysis by Rental Units v. All Occupied Units Census Tract Number of all occupied units) Number of assisted rental units2 Percent of all occupied units that are assisted3 1.1 1,023 3 0.3% 1.2 1,056 35 3.3% 4.1 2,646 385 14.6% 5.1 470 0 0.0% 5.2 2,707 8 0.3% 6.1 1,751 8 0.5% 11.1 818 29 3.5% 11.2 930 13 1.4% 12.1 381 11 2.9% 12.2 491 2 0.4% 13.1 706 12 1.7% 13.2 529 8 1.5% 14.1 269 3 1.1% 14.2 730 87 11.9% 14.3 972 22 2.3% 15.1 684 2 0.3% 15.2 557 6 1.1% 16.1 1,586 12 0.8% 16.2 1,343 81 6.0% 17.1 431 18 4.2% 17.2 327 2 0.6% 17.3 543 6 1.1% 18.1 1,918 68 3.5% 18.2 1,433 149 10.4% 21.1 13 0 0.0% 21.2 631 104 16.5% 23.1 429 1 0.2% 23.2 766 0 0.0% 23.3 6 0 0.0% 104.4 1 0 0.0% 105.1 984 75 7.6% Iowa City 28,372 1,150 4.1% I Includes rental and owner-occupied housing from US Census 2000, Summary file 3, updated with Iowa City residential permit data from 2000-2003. 2 Assisted units data collected by The University ofIowa and the City oflowa City 3 Bold text indicates those block groups with 14.1% or greater of housing units that are assisted. This threshold is ten percentage points above the Iowa City average of 4.1 %. 24 Movin1! to Opportunity There are two broad types of subsidized housing programs in the United States. The most visible are the place-based programs, which involve the development of affordable housing structures, be they single- family homes or multi-family structures. The other major type of housing assistance is through tenant- based Section 8 Housing Choice vouchers. These vouchers are cash payments given directly to clients and used for market-rate units. The voucher amount is the difference between 30% of the clients' adjusted family income and the lower of either the public housing authority-determined standard or gross rent of the unit. Clients may choose apartments with rents greater than the voucher and pay the difference (HUD, Tenant Based Vouchers, 2005). Up until this point, the options for scattering subsidized housing discussed in this report have been project-based. In other words, they have all dealt with the location of development. In contrast, Moving to Opportunity is a tenant-based option, thus managing where vouchers can be used. Moving to Opportunity (MTO) was a 1 O-year federal demonstration project based on the Gatreaux Program in Chicago and was designed to study the effects neighborhood may have on people's lives. Starting in 1994, this project tracked clients receiving federal housing assistance in five major cities, Baltimore, Boston, Chicago, St. Louis, and New York. The clients were randomly placed in one of three groups: · The experimental group was offered housing vouchers and services that could only be used in census tracts with a less than 10% poverty rate. · The Section 8 group was offered regular Section 8 vouchers that were not geographically restricted. They received everything the traditional program offered. · The control group continued to receive project-based assistance and did not receive vouchers. Although final data is still being analyzed, data collected halfway through the program showed that geographically restricting Section 8 voucher use had positive effects of on personal safety; housing quality; mental health and obesity among adults; and mental health, school attendance, and risky behavior in teenage girls. These initial findings also indicated that there were negative effects on boys' behavior, and no effect on educational attainment for children or employment outcomes for adults (HUD, Office of Policy Development and Research, 2003). 25 One frequent concern regarding scattering techniques is the potential disruption to social networks, or social capital, which is most commonly defined as networks of trust and resources. There are two components of social capital: the individual and the community. The individual component--Dr social glue-refers to a person's connection to or involvement in the community. The community component- or social bridges-refers to ties between community groups and affects broader community resources such as the quality of schools and public safety (Lang & Hornburg, 1998; Pettit & McLanahan, 2001). Increased social glue has not been found as a result ofMTO. As low-income families move into areas with fewer people in their own socio-economic group, it is understandable they might feel uncomfortable and be shy or unsure about joining community groups such as the PT A or neighborhood associations. Additionally, there may be resistance on the part of the non-poor in the area to accept the newcomers. It is important to keep in mind that this data was analyzed at the mid-point of the project. Social ties, especially at the individual level, take time to cultivate (Pettit & McLanahan, 2001). While individual social capital may not have been a benefit ofMTO, the experimental and Section 8 groups (those with vouchers, geographically limited or not) lived in neighborhoods with lower rates of poverty, female-headed households, and welfare receipt, and experienced higher rates of employment and education than did clients living in public housing developments. These findings were even more pronounced for the experimental group, which was only allowed to move to those areas with less than 10% poverty (Pettit & McLanahan, 2001). The counseling aspect of Moving to Opportunity proved essential. The experimental group received both housing and non-housing related help, including assistance choosing a neighborhood, finding a unit, negotiating rent, and preparing to move; credit counseling; job training and development; help finding a job; education (specifically addressing literacy); family counseling; health care referrals; and legal and welfare advocacy. This counseling was administered by non-profit organizations, which was found to be an asset as the relationships between clients and non-profits are less regulated and structured than they are with housing authorities. Non-profits are also able to bring important social service and community contacts into the equation. Key characteristics associated with the most effective non-profits in MTO include knowledge of the affordable housing market, and previous experience with low-income clients (Feins et aI, 1997). Four key ingredients for successful counseling were found, as described below. 26 · Completion of an assessment of needs. Each client has different skills, goals, and needs. Completing a needs assessment for each client can identify potential barriers to success and help target resources. · A contract between the client and the organization helps define boundaries and expectations of both parties. This type of contract improved client participation, perhaps by identifying upfront those families willing to put forth the time and energy. · It is important to decide at the outset what counseling services will be offered; specifically, what types of housing and non-housing services will be offered directly or through referral. In order to make informed decisions about this, research such as a market analysis may be desired. It is important that services offered meet clients' needs. · Follow-up support was found to be essential for those families who required more assistance (housing and non-housing). For others, it was characterized more as a bonus (Feins et ai, 1997). Application to Iowa City Iowa City has a well-used voucher program. With roughly 450 landlords in the area accepting vouchers, 99% of the 1,213 Section 8 vouchers available are used each year (Rakis, February 2005). The waiting list has grown from lOin 2002 to over 1,657 by the third quarter of 2004 (Iowa City Housing Authority, 2004). If Iowa City were to institute a program similar to MTO that limits Section 8 vouchers to areas with less than 10% family poverty, four census tracts would be unavailable to clients with vouchers. These census tracts accounted for 25% of the Section 8 vouchers used in Iowa City in October 2004. These findings, and those discussed in the following paragraphs, are displayed in Table 7. Despite using family poverty rates (as opposed to individual poverty rates) in an effort to control for the high percentage of student renters in neighborhoods surrounding the University, the highest family poverty rates are found where we would expect to find high populations of student renters-downtown, including the Northside, Goosetown, and College Green neighborhoods (Tracts 21 and 16) and across the river near the University medical campus (census tract 6). The other tract that exceeds the poverty threshold is home to Pheasant Ridge, the largest place-based assisted housing complex in the city (census tract 4). 27 Table 7: Poverty Rates, Voucher Use, and Rental Units in Iowa City Percent of ICHA Percent of all vouchers used in Number of rental units Census Family Iowa City in each Number of rental obtained with Median Tract poverty ratel census tract2 vouchers2 units I vouchers gross rene 21 26.9% 1.9% 14 612 2.3% $550 16 13.8% 5.7% 43 2,709 1.6% $604 4 13.7% 14.1% 106 1,535 6.9% $476 6 10.0% 3.6% 27 1,388 1.9% $544 18 9.8% 28.6% 216 1,334 16.2% $571 11 7.6% 3.2% 24 1,440 1.7% $531 5 7.4% 6.4% 48 1,459 3.3% $598 104 5.9% 2.4% 18 575 3.1% $484 15 5.5% 3.6% 27 377 7.2% $582 14 4.5% 12.7% 96 541 17.7% $525 105 3.6% 5.4% 41 338 12.1% $619 17 2.7% 4.8% 36 441 8.2% $618 1 2.4% 4.4% 33 643 5.1% $601 23 1.4% 0.3% 2 626 0.3% $642 12 1.2% 1.2% 9 246 3.7% $676 13 0.7% 1.9% 14 155 9.0% $755 Iowa City Avg. 5.0% 754 14,419 5.2% $590 Note: Table ranked by family poverty rate. 'Source: US Census 2000, Summary tile 3 2Source: Iowa City Housing Authority, October 2004 Census tract 18, which is home to the Broadway neighborhood and is commonly perceived as being a poorer area of the city, is slightly under the 10% poverty threshold imposed by the MTO program. While census tract 18 does not reach the poverty threshold, it is home to a larger number of vouchers than any other tract (28%). In comparison, just 9% of the city's rental units are located in tract 18. Expanding this analysis further, the majority (55%) of vouchers are used in census tracts 18, 14, and 4. These three census tracts contain 24% of all rental units in Iowa City. This would suggest that Section 8 vouchers are not used uniformly throughout Iowa City. Vouchers are most likely to be used in tracts with lower median rents. The average median gross rent of those four tracts with the fewest number of vouchers used (5.3%) is $656. This is $132 over the average for the three tracts with the greatest number of vouchers used ($524). It is also beneficial to consider rents in relation to the HUD-calculated fair market rent (FMR). In 2000, the FMR for a two-bedroom unit in the Iowa City MSA was $582. Seven of the sixteen census tracts in 28 Iowa City recorded median gross rents less than that amount. Half (51 %) of all rental units are located within these seven tracts. In comparison, these tracts accommodated 66% of vouchers. Of the four census tracts with family poverty rates 10% or greater, three recorded median gross rents below FMR in 2000. Of the twelve census tracts that would still be available to voucher-users in a MTO scenario, four have median gross rents at or below FMR. Clearly, Section 8 voucher recipients are concentrated in neighborhoods that have lower median rents, as we would expect given the conventions of the voucher program. Without a greater number of affordable rental units, it would be difficult to require voucher recipients to move to some low-poverty neighborhoods. These units could come about through various methods, including development, rehabilitation, or simply a softer market that lowers the cost of housing in general. Housinl?: Consortiums A housing consortium is a grouping of contiguous governments that work together to address housing problems. A major reason for smaller governments to form a consortium is to reach the critical mass of 50,000 people to qualify as a participating jurisdiction and therefore receive federal HOME funds. It also allows them to combine their resources to raise the matching funds needed, which is 25% of the HOME award and must come from non-federal sources (HUD, Building Home Primer). Consortiums help communities work together for the greater good of the region. There are several ways this may happen. For example, small neighboring jurisdictions can combine to be eligible for funding and raise the needed match, or a qualifYing jurisdiction that did not want the responsibility of managing HOME funds could create a consortium with a smaller government that would not qualify on their own. The smaller jurisdiction may take on the responsibility of managing the funds in return for a 'piece of the pie'. Bringing smaller jurisdictions into consortiums helps rural areas develop affordable housing. Consortiums can successfully use public funds to leverage private support. The mandatory set aside of funds for Community Housing Development Organizations (CHDO) can create a stable funding source for non-profit developers for the life of the consortium (Thomas Jefferson Consolidated Plan, 2003). Consortiums culminate in the creation of affordable housing throughout the region in which they are located. While they can help develop a regional scale response to housing needs, housing consortiums on their own they do not aid in scattering subsidized housing. 29 Application to Iowa City Iowa City, with a population over 50,000, qualifies for HOME funds and has been acting as its own participating jurisdiction, receiving HOME funds since 1994 (Nasby, 2005). Funding is competitively awarded based on population, per capita income, number of rental housing occupied by persons in poverty, the number of households in poverty living in rental units built before 1950, the total number of fami I ies in poverty and the overall condition of the stock of rental housing (HUD, The Consortia Builder). Due to the allocation formula, Iowa City would receive the greatest benefit (i.e. the largest increase in funding) by joining forces with a more impoverished area or one with a larger stock of affordable rental housing. This is a situation that we will not find in the region, Iowa City has the most rental housing in the area, and in general the highest median home values and median gross rents (Tiffin has higher rents). Data from the Iowa City Planning Department indicates that forming a consortium would not significantly increase Iowa City's total HOME allocation, and the requirements for sharing between the jurisdictions involved would cause the per capita home allocation to fall. Disregarding the allocation formula for a moment and looking at the issue from a political standpoint, it is likely that if Iowa City were to join forces with a neighboring community, Iowa City would be pressured to use consortium funds to increase its own stock of affordable housing. This is because any entity it joined with, excluding Tiffin, would have an adequate amount compared to Iowa City as shown in Table 8. For example, ifIowa City formed a consortium with the City of Hills, it is likely that some people would argue that since the two cities have similar median family incomes but Iowa City has higher rents and higher median home values, Iowa City has the greatest need for affordable housing and should therefore build the greatest share. Resulting in a political situation that would not necessarily scatter subsidized housing throughout the jurisdictions involved. 30 Table 8: Population, Income. and Housing Data for Greater Iowa City Area Median Median Median Median Median Median Year Housing Family Gross Home Number Value Per All Housing City Population Units Income Rent Value of Rooms Room Units Built Iowa City 62,381 26,052 $57,568 $572 $121,400 4.8 $25,292 1973 Coralville 15,143 6,753 $45,096 $561 $117,800 4.6 $25,609 1967 North Liberty 5,381 2,343 $53,750 $495 $94,200 5.0 $18,840 1990 Kalona 2,267 972 $45,897 $456 $91,800 5.7 16,105 1971 West Branch 2,209 904 $51,667 $450 $88,900 5.8 $15,328 1971 Solon 1,172 494 $58,289 $534 $110,300 5.9 $18,695 1968 Lone Tree 1 134 501 $50,000 $495 $91 5.8 15,793 1962 Tiffin 999 463 $47,969 $588 $99,300 4.7 $21,] 28 1995 Hills 684 257 $57,386 $527 $106,800 5.8 $18,414 1966 Oxford 675 281 $48,750 $438 $81,400 5.7 $14,281 1950 Source: US Census 2000, Summary file 3 and Summary file 2. The match required to receive HOME funds is substantial and the more governments involved, the easier it may be to raise the necessary money. However, a joint consolidated plan, administration and organizational structures would be needed for a consortium to succeed, involving a complex planning process. Due to the complexities of involving multiple governmental entities, setting up a consortium and deciding how to apply the funds has the potential to be difficult, time consuming, and politically challenging. 31 TASK FORCE RECOMMENDATIONS Summary of Recommendations The Task Force presented recommendations to guide future development of assisted housing for public comment at their March 28th meeting. We present a summary of their recommendations and discuss specific points of interest in this section. A full list of their recommendations is included in Appendix A. Their main recommendations are: · Iowa City should maintain their commitment to assisted housing and increase opportunities for affordable housing generally. · Iowa City should take steps to prevent future concentrations of housing. · Iowa City should adopt a voluntary inclusionary zoning policy and take steps to ensure a fair share distribution of assisted housing throughout the community. They also suggest an education campaign for City residents and surrounding municipalities on the importance and need for affordable housing. The community needs to be aware of the degree to which housing and development decisions involve all segments of the community. Task Force Matrix The Task Force identified block groups that have fewer units than 37, which is the number of assisted units each block group should have to evenly distribute assisted units according to their matrix. The Task Force recommends that future assisted housing development be encouraged in these block groups by allocating funds above and beyond thè current federal CDSO and HOME funding. To support increased private market development of assisted and affordable housing, zoning and code regulation changes should be considered. The Task Force urges the City to commit sufficient resources to scatter affordable housing, without causing a reduction in the supply. Implications of Task Force Recommendations Future development of new assisted housing would be concentrated in a few block groups. The Task Force identified areas of Iowa City that currently have their fair share of assisted housing and those that do not. In their recommendations, they encourage assisted housing development in those areas 32 with fewer units than their fair share, illustrated in Map 2. However, their analysis does not include other factors that affect development, such as the location of developable land. The majority of developable land is located in block groups that the Task Force has deemed unsuitable for assisted housing, greatly limiting the total quantity that can be constructed in Iowa City. Map 2: Implications of Task Force Draft Recommendations3 Implications Of The Task Force Recommendations e o City Boundary Where Assisted Housing Will be Encouraged _ Where Assisted Housing Will Not Be Encouraged _ Developable Land Currently Used as Ag. Developable Land Currently Used as Residential 4.1 Census Tract and Block Group o 0.20.4 0.8 1.2 Mh.s I I I I I I Data Source: ESRI. 2000 Census. City oflo'AQ City Paning Department.Johnson CountyAssl5sor Unintended impacts could be realized if recommendations are not adopted as a whole. Many of the recommendations the Task Force drafted are most effective when enacted together. For instance, encouraging rental opportunities outside of University of Iowa student-populated areas to make it easier for families to compete with students for housing (Task Force Draft Recommendations (TFDR) specific objective 6) would be more effective if the City also did more to encourage affordable housing opportunities "by exploring creative approaches to housing and development" and perhaps revising 3 Data from the Iowa City Assessor was used for this analysis. Land use was used as a proxy for zoning classification due to data and time restraints. 33 zoning regulations to permit smaller lot sizes and row houses (TFDR specific objective 5). Additional funding may make it easier for developers who currently build assisted housing to develop in those areas that do not currently accommodate their fair share (TFDR specific objective 3), but an inclusionary zoning ordinance (TFDR specific objective 9) might encourage more developers to build assisted housing. This would result in not only greater dispersal, but perhaps a greater number of units as well. However, these points are not made in the recommendations; there is no guidance for Council on how these objectives work together to create a cohesive whole. This concern was demonstrated by the challenge from one community-member to the Task Force to advocate for their recommendations throughout the whole process, not to end their involvement after they present to Council. Effective moratorium may occur. Withholding support from assisted housing in block groups with more than fair share could effectively put a moratorium on assisted housing development. The Task Force includes language that the City should only withhold support to assisted housing development in over represented block groups if efforts to encourage development elsewhere maintain the current supply (TFDR specific objective 4). The efforts to encourage development in underrepresented block groups include providing funds in excess of the federal and state CDBG and HOME funds that are currently used (TFDR specific objective 3) and adopting a voluntary inclusionary zoning ordinance where developers are offered incentives but are not required to include assisted housing in their developments (TFDR specific objective 9). However, one fear is that City Council will only adopt the part of the recommendation that discontinues support to certain block groups and does not do enough to break down current market barriers to development. If this happens, a virtual moratorium on assisted housing development could occur. Adopting mandatory inclusionary zoning ordinance would go far to allay these fears. Land prices will affect development. What effect will increased development costs, incurred by building on higher priced land, have on the number of assisted units constructed? If fewer units can be built, is dispersal still preferred? The Task Force realizes that costs will increase in some areas. As a Task Force member stated in the public meeting, the same market forces that increase the price of land have concentrated assisted housing in Iowa City (VandenBerg, March 28, 2005). If those market forces are not changed, this could have the outcome of fewer units bui It. 34 Residency preference ineffective. The recommendation for a residency preference for Section 8 and other subsidized housing (TFDR specific objective 2) generated strong reactions from the public. The two most prevalent objections to the recommendation are: · Obtaining residency in Iowa is relatively easy. To obtain a drivers license, prospective residents are required to register to vote, enroll their children in school, obtain full-time employment, or live in Iowa for 30 consecutive days (Iowa Department of Transportation, 2005). Therefore, such a preference would be merely 'window dressing' (Rackis, Task Force Meeting March 28, 2005). · Whether motivated by a notion to keep African Americans from Chicago out of Iowa City or not, it will be perceived as such. Limiting rehabilitation opportunities. Some organizations noted that the recommendations do not leave room for rehabilitation in areas that are overrepresented or allow for funding rehabilitation of existing assisted units. This will decrease funding opportunities as many grants are awarded for rehabilitation (Axeen, March 28, 2005). In addition, many grants specify maximum amounts that can be spent per unit. These recommendations may result in increasing costs for such development and may affect funding (Offutt, March 28, 2005). Limitations of unit of analysis. Another concern noted at the public meeting was the use of block groups in the analysis. This unit of analysis was chosen by the Task Force because they are defined at the federal level (not influenced by local politics) and consistent, independent data is readily available. One commenter stated that the block groups do not necessarily represent the impacted area. For instance, Pheasant Ridge, the largest subsidized housing development in Iowa City, is located right on the edge of census tract 4 block group I (Otte, March 28, 2005). 35 STUDY ANALYSIS Alternate Matrix Recommend¡:ttion The suitability of a site for assisted housing depends on many factors such as land price, poverty rates, and the amount of existing assisted housing. A site suitability analysis provides an example of different outcomes by taking into account these additional factors. The factors utilized within the index can be divided into two categories: development feasibility and concentrations of low-income populations. Barriers to developing assisted housing include higher land prices and availability of land. The index considers two factors as a proxy for value of land: median owner-occupied home value and median gross rents. Subsidized housing would be difficult to develop in areas with higher home values and gross rent because greater subsidies would be needed to make them affordable to low-income populations. The availability of land for new development is represented by one factor: the percentage of land in each block group that is available for development. This factor is aimed toward encouraging the inclusion of subsidized units in new residential development, therefore block groups with large percentages of undeveloped land would receive favorable ranking. However, subsidized units are also created through rehabilitation and acquisition. Opportunities for rehabilitation and acquisition can be found across all block groups. Therefore the index does not include a variable for land available for rehabilitation and acquisition as each block group has the same rank. To avoid potential concentrations of poverty or subsidized housing, assisted housing development would be encouraged in areas with smaller proportions of these populations. Two factors were taken into account in the index to illustrate this point: the percent offamilies in poverty and the percent of subsidized units. The percent of subsidized units is calculated using all housing units, not just rental units. The site suitability scores were calculated by ranking block groups according to the values of the aforementioned variables. Each block group was then assigned a value equal to their rank number relative to the score of other block groups. The more negative the impact on the development of affordable housing or concentration of low-income persons, the lower the score assigned. The rank scores for each variable were summed, resulting in the cumulative index score (Table A in Appendix B). The block groups were then segmented into three equal groups based on their index scores. The group 36 with the lowest index scores represents areas deemed less desirable for additional assisted housing development, while the group with the highest scores represents areas deemed most suitable (Map 3). Incentive levels could be coordinated with these group designations. A more in-depth discussion of the methodology can be found in Appendix B. Using the index scores, one option for the City is to adopt a citywide inclusionary zoning policy. This could be either a mandatory or voluntary policy, as described in the Dispersal Techniques section of this document. We offer two scenarios that would be applicable under either a mandatory or voluntary policy. In scenario one, the level of incentives would be the same across the city, but the proportion of subsidized units required in new residential developments would vary based upon the index score. In other words, new residential developments in block groups with high index scores, meaning assisted housing development is desired, would be required to include a higher proportion of assisted units than block groups with low or medium index scores. Under the second scenario, the proportion of assisted units required with each new residential development could be the same throughout the city. However, the level of incentives would vary based on the index score. For instance, developers who chose to include the set proportion of assisted units in areas with high index scores would receive higher incentives than those who build assisted units in block groups with lower scores. This is the scenario we have adopted in our matJjx. In our matrix, a lower index score indicates that the block group has a combination of high rent, home values, families living in poverty, subsidized units, and low proportions of developable land. Areas with this combination of characteristics may be less attractive locations for new subsidized housing. 37 Map 3: Site Suitability Analysis Site Suitability Analysis Affordable Housing Iowa City. IA 2005 e Thl~ documenc w:n a-e-.W.,d by the Urb;¡n ,& keVQt"qi Pbnn,nt DepMttnli1nt ,~t rtw Uni¥f:r~iC) QI k"....,1 D"t;I 5<:'lJr((':: ESI\J, OS C(.'f)u.u, City 0' bw., CitY' Ptll'Ù~ ~~rtrrwM. &; JÇ¡t\fI~C1'I COUl'1tt IÖ>'Y",\ Pbnnirt & ZO!'Img D~~',Ftmt':flt In contrast to the Task Force recommendations, rehabilitation opportunities would exist in the scenario suggested by this study. COBG and HOME funds would still be available for those who want to develop or rehabilitate assisted housing in those block groups with a low index score (i.e. those that have a higher percentage of assisted housing). One challenge to evaluating assisted housing units is defining the area of their impact and then collecting data for that specific area. Given the strong identity that neighborhoods have in Iowa City (defined by neighborhood associations), one idea would be to compare data at the neighborhood level. However, the US Census Bureau does not release data at the neighborhood level and not all parcels are associated with a specific neighborhood. Another option would have been using census blocks. Yet, not all data is released at this minute level, such as poverty. Census tracts, a level at which all data is released, were deemed to be too large to provide useful information. Given these constraints the most logical choice is 38 to use census block groups. Although block groups do not directly relate to the neighborhoods in Iowa City, they are generally compact and relatively consistent areas. In addition, the necessary data is available at this level. While the concerns voiced regarding the somewhat arbitrary boundaries of these groups are valid, it is the best option. 39 STUDY RECOMMENDATIONS Overall, The Task Force has tackled the immense and politically delicate issue of subsidized housing dispersal with enthusiasm and good intentions. The process has been long and arduous and the Task Force has continued to push themselves to a better understanding of the issue, possible responses and policies. However, we would like to offer several recommendations. Include both residents of assisted housine: and developers in the process. There are numerous community stakeholders in the issue of assisted housing, and overall, the Task Force successfully incorporated each into this process. However, two groups' absences in particular are missing: residents of assisted housing and housing developers. While residents in assisted housing have not traditionally been influential in siting assisted and affordable housing development, they have just as much-if not more-to gain or lose as any other stakeholder. If a primary reason to disperse assisted housing is to improve the lives of people living in assisted housing and increase opportunities for their success, this group is integral to the success of any policy. Residential developers, both market rate and those who develop assisted housing, are intimately involved in the issues discussed by the Task Force. They will be acutely affected by any policy adopted by City Council. Their knowledge of the residential development process and how they will be affected by potential policies would serve the Task Force well. While these groups were invited to present, we suggest they could have played a greater role, such as sitting on the Task Force itself. Take the distribution of residential housine: into account when definine: concentration. The Task Force was remiss in not accounting for the distribution of residential units in Iowa City in their fair share matrix. An alternative to their fair share calculation is analyzing the proportion oj assisted units to all housing units. Using the proportion of all housing units that are subsidized rather than a set number of units (such as the 37 used by the Task Force) controls for the amount of residential development in each block group. Housing is not evenly distributed across Iowa City. For example, census block group 14.1 has 269 housing units, compared to census block group 5.2 that has 2,629 housing units. Ifboth block groups were required to have 37 assisted units each to fulfill its fair share, 14% of block group 14.1 housing stock would be assisted, compared to only I % of block group 5.2. Because of this, the Task Force matrix does not address alleviating or preventing concentrations of assisted housing. 40 Consider more than iust assisted housin!! placement in dispersal policv. The current location of assisted housing is a key component of evaluating where to encourage assisted housing development, but it should not be the only component. Other variables impacting assisted housing development and the livability of such developments such as rents, zoning allowing for and encouraging such development, the availability and cost of developable land, access to jobs, transportation, social services, daycares, and grocery stores should also be taken into account. This type of analysis, such as the site suitability analysis used in this study, helps identify barriers to assisted and affordable housing development and highlight strategies to alleviate those barriers. Chan!!e the zonin!! code. The City should consider revising the zoning code to remove barriers to the development of affordable housing. The map below (Map4) shows the amount of developable land that is currently being used as residential, agricultural, and commercial. Developable land is land with an assessed building value equal to zero, the land use is defined by the Iowa City Assessor. It would be advantageous to affordable housing development to allow higher density development in more areas, especially residential. Higher density developments encourage affordable housing by allowing the developer to offset the cost of such development over a greater number of market rate units. In addition, smaller units on smaller lots cost less per unit to build, and therefore can sell for lower prices than larger units and are more affordable for lower-income populations. In areas currently used commercially, implementing an element to the zoning code that avoids regulating by land use would be beneficial. This could be done through form-based codes that focus on the physical landscape, density, bulk, and interconnectedness of neighborhoods and performance-based codes, which allow the land to be used in any manner as long as certain set criteria such as noise and pollution levels are not violated. Both form-based and performance-based codes consider the carrying capacity of the land, land economics, the dynamic nature of communities, and the impact of development. Removing the land use focus would allow housing to develop through more areas of the city and in conjunction with other uses, creating opportunities for mixed-use communities. Much of the land currently used agriculturally has been temporarily zoned interim development. This type classification is often seen as a 'holding zone' until development becomes more of a priority. These areas are then expected to be rezoned. The zoning concepts stated above for residential and commercial development can be applied to the agriculture areas as their classification changes. 4] Map 4: Rezone Developable Land To Encourage Affordable Housing"' Rezone Devellopable Land To Encourage Affordable Housing 9 D City Boundary _ Developable Land Currently Used as Ag. Developable Land Currently Used as Residential Developa,ble Land Currently Used as Commercial 4.1 Census Tract and Block Group o 0.20.4 0.8 1.2 Miles I I I t t I O,~r,;) ),XW(>t: ESRI. 2000 C::n-"\I:i. Cit)' 9f k?w',\ City PlMHttg Ck'f.';ìrtn'C11\.J¡;;.tJ'"I¡¡Ç() Ct.:ttlntt A~~(>}}or Develop an effective inelusionary zonin!! policy The benefit of a mandatory inclusionary zoning policy is that assisted units would be built in each new development, which not only would scatter the units but also allow the city to estimate how many subsidized units would be built within each new development. A mandatory inclusionary zoning policy could provide incentives, such as density bonuses, height variances, and a streamlined application process, to developers to offset the costs they incur in developing affordable housing. For instance with the site suitability analysis done for this study, incentive levels could be defined as low, medium, and high. A low incentive level would provide no additional funding to current funding options such as 4 Data from the Iowa City Assessor was used for this analysis. Land use was used as a proxy for zoning classification due to data and time restraints. Parcels with an industrial were not included because it is not a suitable location for residential development. Tax exempt property is not given a classification by the assessor, and were therefore not able to be included in the analysis. 42 CDBG and HOME funds. CDBG and HOME funds would not be used as incentives as they are a major source offunding for all affordable housing developments, and their use as leverage in development has the potential to decrease the affordable housing stock. Medium levels could include incentives that would offset development costs, whereas, high levels would go beyond the medium incentives offsetting costs and possibly providing a small profit. Striking the right balance of incentives will be crucial to the success of either a voluntary or mandatory inclusionary zoning policy. Setting the correct incentive levels will most likely be costly and require difficult and time-consuming analysis and discussions with all invested parties such as developers. However, there is less room for error in a voluntary scenario. If incentive levels are set too small to off- set market forces that affect the cost of developing assisted housing such as land values and the delays associated with neighborhood opposition, developers will simply not include affordable housing in their developments. A mandatory policy allows for more room for error while ensuring that units will be built. Develop a Housine: Linkae:e Fee Proe:ram The establishment of a housing linkage fee per square foot of market-rate residential construction could be used to raise funds to address the City's low-income housing needs. The per-square-foot fees would be dependent on the housing development impact determined in Iowa City. Payment of the fee would be a condition of issuance of the building permit, based on the square footage of the building. Developers could build the cost of compliance into overall project budgets, likely passing on the cost to residential homebuyers, however, as demonstrated in the hypothetical example below, the cost per residential unit would be quite small. Collected fees could be allocated to the County Housing Trust Fund to be used for development of assisted housing. The average new home constructed in the United States in 2002 was 2,320 square feet (Weber). Using a hypothetical linkage fee of $.08 (as stated above the actual fee would need to be determined through a quantitative impact study, an average single-family home built in the United States in 2002 would generate $186 to be set-aside for affordable housing development. The average number of single-family permits issued by Iowa City between 2000 and 2004 is 124. Using this average, the linkage fee would result in approximately $23,000 per year to be set aside for assisted housing development. These funds could be used as leverage to generate more funds dedicated to assisted housing development. Housing Trust Fund money could be combined with additional financial subsidies such as state and 43 federal tax credits, state deferred loans, land write-downs, or federal rent subsidies to increase the affordable housing stock. Explore ways to use current funds more efficientlv Federal funds are often given as grants, which do not require any repayment of those funds. This essentially decreases the pool of funding a city has to work with. If those same funds were loaned instead of awarded as a grant, the money could be recycled, allowing the city to have a more sustainable and consistent pool of money and could act as a safeguard against potential federal funding cutbacks. This can be accomplished without sacrificing the mission of grants: to allow for development that might otherwise not happen due to market constraints. Options to accomplish this could include originating loans at a significantly lower interest rate, deferring repayment for a set amount of time, or not requiring funds to be repaid until the home is sold. An example of such a system is a Revolving Loan Fund. A COBG and HOME Revolving Loan Fund, otherwise known as an "RLF," is a source of money from which loans are originated. From a RLF, a loan is made and as repayments are made, funds become available for new loans to other housing developers. RLFs are established to provide a source of financing, which may not otherwise be available within the community. When using HOME funds, loans up to a maximum of $5,000 can be made to encourage homeownership, requiring a dollar to dollar match of the home buyer's own down payment funds. Activities financed will generally be, but are not limited to, down payment, closing costs, and renovation activities. For example, a HOME-funded RLF loan would have a fixed interest rate of2%, with the length of the loan set at seven years. The first two years would be deferred of interest and payments. By deferring repayment of the principal, the private lenders will have what will be considered a "less risky loan". Also, by deferring repayment of the loan, the monthly payments will be reduced for the borrower. Although the HOME- funded RLF loan is not the primary source of financing for a project, the combination of public and private financing lessens the risk for the primary lender (by decreasing their exposure) and yields an overall lower cost of borrowed money for the homeowner. The existence of an RLF promotes goodwill for the local community. Homeownership is encouraged by programs which support retention and expansion, utilizing flexible, locally controlled funds. This demonstrates a pro-housing attitude, which is critical when developing partnerships between the public and private sectors. 44 ApPENDIX A: TASK FORCE DRAFT RECOMMENDA nONS 45 ApPENDIX B: SITE SUITABILITY ANALYSIS INDEX To measure the level or degree of incentives that should be offered in particular areas of Iowa City to create new subsidized housing, we created a site suitability index. The variables contained in the index are family poverty rates, median gross rent, median housing price, percent of subsidized housing, and amount of undeveloped land in a particular block group. The calculation of the final index score was the result of a series of steps. All variables were normalized to ensure consistency. Step 1: The block groups were sorted in ascending order, from most negative to most positive value, according to their percentage. Next, each block group was assigned a value equal to the data rank. Familv poverty rates Lower score for higher percentage · Rates were calculated by taking the total number of families below the poverty level over the total population of which poverty data is collected and multiplying by 100 Median I!ross rent as a percental!e of the median 2:ross rent of Iowa City Lower score for higher percentage · The percentage was calculated by taking the median gross rent of a block group over the median gross rent for Iowa City and multiplying by 100 Median home value as a percental!e of the median home value for Iowa City Lower score for higher percentage · The percentage was calculated by taking the median home value of a block group over the median home value for Iowa City and multiplying by 100 Subsidized housinl! as a percent of all housinl! units Lower score for higher rates of subsidized housing · The percentage was calculated by taking the total amount of subsidized housing units in a block group over the total number of all housing units (rental and owner-occupied) in a block group and multiplying by 100. 46 Percentae:e of undeveloped land Higher score for higher percentage of undeveloped land · Rates were calculated by taking the total amount of undeveloped land in a block group over the total area of the block group and multiplying by 100. The amount of undeveloped land was determined from the Johnson County parcel data with any parcel having no building value. This is used as a proxy for undeveloped land. Step 2: The rank scores for each variable in each block group were added together, resulting in the calculation of a cumulative index score. Step 3: Block groups were ranked according to their cumulative index score in ascending order, and they were divided into near-equal groups based on their index scores. Different levels of incentives can be offered to these groups to encourage development at varying degrees. According to our study, lower cumulative index scores dictate less incentives be given to develop subsidized housing in a particular block group. 47 Table A: Block groups within Iowa City and the Index Score All Gross Home Rent: Value: Percent of Percent Percent Percent of Census all units that of Iowa of Iowa Family Block Block are City City Poverty Group Index Group subsidized Rank Median Rank Median Rank Rate Rank Developable Rank Score 16.2 6.0% 6 105.1% 14 119.3% 11 13.8% 3 3.0% 12 46 16.1 0.8% 16 111.2% 9 99.9% 17 13.8% 4 1.6% 5 51 12.1 2.9% 10 147.1% 1 119.7% 10 0.0% 25 2.0% 7 53 105.1 7.6% 5 140.7% 3 201.3% 1 2.9% 21 16.0% 25 55 4.1 14.6% 2 84.2% 28 155.6% 3 13.7% 5 9.2% 20 58 11.1 3.5% 8 93.5% 23 101.2% 15 9.2% 7 2.4% 8 61 23.1 0.2% 21 115.4% 7 186.8% 2 3.4% 20 2.8% II 61 1.2 3.3% 9 129.0% 5 138.6% 4 3.7% 18 17.9% 27 63 21.2 16.5% 1 61.2% 30 0.0% 29 26.9% I 1.1% 3 64 13.2 1.5% 13 128.7% 6 122.5% 7 1.5% 23 6.9% 16 65 5.1 0.0% 22 108.1% 13 122.4% 8 4.6% 14 2.8% 11 68 18.1 3.5% 8 114.7% 8 100.0% 16 5.6% 10 16.7% 26 68 15.2 1.1% 15 109.9% II 79.0% 27 6.9% 9 3.4% 13 75 5.2 0.3% 20 89.7% 25 134.4% 6 8.0% 8 7.0% 17 76 13.1 1.7% 12 144.8% 2 107.5% 12 0.0% 30 12.6% 23 79 12.2 0.4% 19 108.8% 12 99.7% 18 2.4% 22 2.6% 9 80 17.1 4.2% 7 138.1% 4 77.9% 28 3.7% 17 15.3% 24 80 17.2 0.6% 17 110.6% 10 79.3% 26 0.0% 25 1.3% 4 82 18.2 10.4% 4 92.2% 24 81.5% 24 15.0% 2 26.2% 29 83 6.1 0.5% 18 96.3% 19 85.8% 22 10.0% 6 8.5% 19 84 15.1 0.3% 20 94.7% 21 10 1.7% 14 4.4% 15 4.9% 14 84 23.2 0.0% 22 98.8% 18 121. 9% 9 0.0% 25 2.7% 10 84 14.2 11. 9% 3 68.8% 29 92.0% 20 5.2% 13 9.9% 21 86 14.3 2.3% 11 99.8% 17 99.2% 19 5.3% 11 21.0% 28 86 104.4 0.0% 22 88.8% 26 90.6% 21 4.2% 16 0.6% 1 86 17.3 1.1% 15 102.3% 15 82.7% 23 3.5% 19 6.2% 15 87 21.1 0.0% 22 100.0% 16 0.0% 29 0.0% 25 0.7% 2 94 11.2 1.4% 14 94.2% 22 81.2% 25 5.3% 12 11.3% 22 95 14.1 1.1% 15 85.1% 27 103.3% 13 0.0% 25 7.6% 18 98 1.1 0.3% 20 95.8% 20 138.1% 5 1.4% 24 31.9% 30 99 23.3 0.0% 22 0.0% 31 0.0% 29 0.0% 25 1.7% 6 113 Note: Table ranked by Cumulative Index Score. Source: Authors 48 ApPENDIX C: DISTRIBUTION OF SUBSIDIZED HOUSING Map 5: Distribution of Subsidized Housing Distribution of Subsidized Housing Iowa City, IA 2005 e . . . Number of Units Ore-ater Iowa City . I 0.12 Housing Fellowship Iowa Crty 0.5 1 Mílos 13 - 30 . Housing Authority 01110'- 31081 082-248 CJ Iowa Cìty Boundary Blo<:k Group , ",. i """. ....J 'i.... .'~ .œ . . o Q; .. . '~:;.. i ! ·0 . ..\ ......,i . . !-#' ., .- i .-. .. .,. " . Thi$ OO:\iI.-..ant W;\Z CI'Ci"HOO by the Urb~ri & ~~t PI.~n"!'If' t D<.;'p~}rtmont _,t thf1 Ur.i"(wJ,.it)' C'f C'^"\ D;¡f.1 X:.urœ: BIt!, US CmìSI.H,. Cit/ of þ",,;'! Cit)' pj,)r,¡ng Oep.lrm-.enL& JOOHo¡!) Cou,r,tf k.w...~' PlanrlH'<g & LOlling CX!p.'lrtll1éOt .. The taciílt~f, I!r'!c\üded in the OUHH r;ate90ry arf! $:~t!"'tñS Un!irnt1~ct. Phb'iHi.¡[ n( Rid( ~ Concord Terrace. Erne>r$Of1 Pc<ml&~ L~$lnQ!{';n ÞI~t::e_ Hi\CAP Sh~tI&r HOliStt, Su(ctlos.",ful Uvi"g Autumn Park. Capital Hç,use. VIlla C"':trcJen Four Oak:s Emergency Youtli Shetter ùVIP MËCCA. Ecurnenj-ca! Tawef~, CihZM Bwkhr\g and Regency He iJhts 1 and :2 49 ApPENDIX E: ANNOTATED BIBLIOGRAPHY The annotated bibliography has four sections: inclusionary zoning, housing consortiums, Moving to Opportunity, fair share housing, and defining and calculating a definition of concentration. Inclusionarv Zonine 1. Stringham and Powell. "lnclusionary Zoning Makes Housing Less Affordable." San Francisco Business Times. Nov. 22, 2004. Two Economics Professors argue how the use of incIusionary zoning will not provide affordable housing in the market. In fact, affordable housing mandates, such as inclusionary zoning, restrict the supply of new homes and make housing less affordable. Stringham and Powell argue that inclusionary zoning acts as a tax on builders and, in the Bay Area; a tax of $44,000 is placed on each market-rate home. The slow pace of inclusionary zoning is restricting the ability of city's to meet their affordable housing needs. The number of ordinances, rather than the ability of the ordinance to increase affordable housing are the measure of many inclusionary zoning successes. Therefore, inclusionary zoning ordinances do not equal action. 2. Oser, Alan S. "Space Bonus for New Buildings Help Save Tenement." New York Times. Section 11, Column 1, P. 9. April 30, 2000. New York City's inclusionary zoning program states that a developer of market-rate housing in a high density zone in NY can add up to 20% of additional residential space over the basic zoning limit by providing the financial incentive to generate new or upgrade low-income housing within the boundaries of the community district of the market-rate project. The builder can either produce the low-income units or buy development rights generated by another developer. The square footage allotted for the market rate development depends on the type oflow-income housing produced (new, major rehab, or minor rehab). The program has produced over 251 units since its inception in 1988. There was a stagnant period in the 1990's when little development of occurring, but the NYC Department of Historic Preservation and Development's have noted an increase in the use of the inclusionary zoning program since 2000. 3. Rather, John. "Southold Passes Regulation on Affordable Housing." New York Times. Section 14LI, Column 4, P. 5, September 5, 2004. 50 The Town of Southold, NJ is requiring that developers build one affordable housing unit for every 3 market-rate housing units produced. The inclusionary zoning requirement applies to subdivisions of 5 units or more. Developers are granted higher densities when they comply with the inclusionary zoning requirement. Southold plans to give residents earning less than $80,000 a year preference in obtaining an affordable housing unit. 4. Porter. "Inclusionary Zoning: The Missing Piece to the Affordable Housing Puzzle." National Association of Realtors. Winter 2003. The supply of affordable housing is not keeping pace with job growth and family formation across the nation. Many communities are combating this issue by developing inclusionary zoning ordinances. These ordinances require or establish a voluntary goal for new residential developments to set-aside a portion of housing units for lower-income households. Inclusionary zoning ordinances may require developers to pay a fee in lieu of constructing units or the developers are required to produce the affordable housing. Unfortunately, inclusionary zoning programs are a catalyst for debate. Many builders/developers feel that inclusionary zoning deprives them of their economic right and is an unlawful taking of private property for public purposes. Economists argue that inclusionary zoning is a tax placed on developers, which are then passed on to the consumer or back to the landowner. Many of the problems associated with inclusionary zoning can be avoided by conducting studies on the affordable housing need of an area and basing the ordinances/programs on state planning and housing laws. Inclusionary zoning has shown that affordable housing can be built in areas with escalating housing prices. 5. Burchell and Galley. "Inclusionary Zoning: Pros and Cons." New Century Housing. Vol. I: Issue 2. October 2000. The Center for Housing Policy. Inclusionary zoning is used to allow affordable housing to integrate other developments taking place in a community. Typically inclusionary zoning ordinance require a minimum percentage of affordable units to be provided. The overall goal is to establish a relatively permanent stock of affordable housing units in the private market. A majority of inclusionary zoning ordinances include incentives to entice developers to develop affordable housing. 51 The first inclusionary zoning technique was employed in Fairfax County, VA in 1971. The ordinance required developers of more than 50 multi-family units to provide 15% of their units within an affordable range. The requirement was overturned by the VA Supreme Court in 1973 and was ruled a taking (there was no compensation). In 1973, Montgomery County, Maryland instituted a countywide ordinance that is still in use today. In a 1990 survey conducted by Mary Nenno, 50 local inclusionary zoning programs were identified across the nation (a majority in California). Many cities use inclusionary zoning as a regulatory tool to create diverse communities because can be administered at little or no cost to the local government. Inclusionary programs also encourage the possible integration of populations, heeding gentrification. Many low-income families live in affordable housing outside the city where they work. The inadequate supply of housing in enterprise areas leads to large-scale commuting and the overtaxing of existing transportation networks. Inclusionary zoning brings affordable housing to the employment centers decreasing sprawl. Adversaries of inclusionary zoning assert that developers cannot make money developing affordable housing. Many equate inclusionary zoning as a tax, which developers pass on to the consumer. Another common argument against inclusionary zoning states that density bonuses, provided as part of the inclusionary ordinance, increase unwanted and unplanned-for developments that burden the local environment and the public service capacity. 6. Brown, Karen Destorel . "Expanding Affordable Housing through Inclusionary Zoning: Lessons from the Washington Metropolitan Area." Brookings Institution Center on Urban and Metropolitan Policy. October 2001. Four areas within Washington Metropolitan Area contain a zoning ordinance that promotes the expansion of affordable housing in their county boundaries. Montgomery County, MD has the oldest inclusionary zoning ordinance. Other counties reviewed include Fairfax County, VA; Loudoun County, VA; and Prince George's County, MD. Although the ordinances are structured in a similar manner, their ordinances have variances that shape the development of affordable housing. The paper identifies the obstacles facing new and old inclusionary zoning ordinances, identifies areas where changes can be made to increase productivity and ensure longevity within the programs. The incIusionary zoning programs are examined on their effectiveness in building affordable housing and determining that the housing is built throughout the jurisdictions. 52 7. "Inelusionary Zoning around the Country." www.inhousing.org. Accessed December 2004. The paper gives a broad sample of inclusionary zoning programs around the country. A large amount was written on the varying programs in California (54 in 1994). Summaries of what works and does not work within the programs are a valuable piece of the paper. Interesting programs include: Sanibel Island, FL (difficult program due to resort-nature of city); Boulder, CO (only applies to residential); Fairfax County , VA (Original Program deemed a taking, established another program in 1997); Arlington County, VA (many problems with inclusionary zoning administration due to high development costs and lack of benefit to developers). 8. Cardwell, Diane. "City Sees Way to Get Mix of Homes on Brooklyn Waterfront." New York Times. Section B: p. 1 Dec. 27,2004. The Bloomberg administration is under pressure to develop low-income housing where it allows new development. Although the city has flirted with inclusionary zoning in the past, Bloomberg currently recommends a program that offers subsidies to developers of rental complexes to set aside 20% of the units for tenants with low-incomes. Unfortunately, developers have been shying away from rental development, which is leaving the low-income population underserved. The current proposal in Brooklyn allows developers to developer 18% more square footage in exchange for setting aside 15 to 25% of their units for low-income persons. Developers are given a choice on how to meet the requirement, either by building the low-cost units within their market rate complexes, or by putting them in different locations. A large incentive for developers to comply with the inclusionary zoning proposal is their ability to "double-dip", such that developers are able to take advantage of other subsidies in addition to the right to build more apartments. Critics argue that the "double-dipping" may leave less money for affordable housing to be built elsewhere. Bloomberg argues that the program structure is necessary for the goals of the program to be accomplished. 9. "Increased Housing Opportunity in New York City: The Case for Inclusionary Zoning." Link and Pratt Institute for Community and Environmental Development. Fall 2004. Policy 53 New York City's population has grown significantly in the last decade. Unfortunately, the housing market has not kept pace with the increased need, particularly with affordable housing. Mayor Bloomberg has proposed a plan to increase the number of housing units in NYC, and the plan includes provisions for low-income housing. The main tactic in increasing the affordable housing market is using inclusionary zoning incentives. PolicyLink recommends that the inclusionary zoning policy in NYC be: mandatory, offer incentives in high density neighborhoods, allow developers to make a profit when producing affordable housing, maintain permanent affordability of inclusionary units, encourage mixed-use development, and have clear legislation and consistent administrative oversight. Inclusionary zoning legislation can only be useful if the city and the developers are willing to work together to develop a consistent and fair plan. 10. "Inclusionary Zoning." Innovative Housing Institute. December 2004. www.inhousing.org. Accessed January 2005. The article discusses the main argument used against inclusionar'y zoning and offers insight into the strength of the opposing arguments. The 6 main arguments are: 1. Inclusionary zoning amounts to a government "taking" under the constitution. 2. Density Bonuses are a bad idea. 3. Inclusionary zoning is a form of discredited engineering. 4. Developers cannot make money on inclusionary units. 5. Developers should not have the burden of curing the community's social/affordable housing problems. 6. Inclusionary zoning programs should be voluntary, not mandatory. The inclusionary zoning laws in place today do not deprive the developers of a reasonable economic profit. Many developers are given incentives and bonuses are compensation. Density bonuses offered to developers are typically well-within acceptable standards and are likely less than multi- family zones, and with appropriate density bonuses the affordable units should not cost the developer 54 extra. Developers, like all segments ofa community, have role to play when dealing with social and/or affordable housing problems. Mandatory inclusionary zoning legislation is a more productive and efficient method of tackling the affordable housing crisis facing many cities and communities. 11. Brunick, Goldberg and Levine. "Large Cities and Inclusionary Zoning." Business and Professional People for the Public Interest. November 2003. Inclusionary zoning has often be used as a tool for mediating affordable housing in medium-sized cities, but the inclusionary zoning technique can be utilized in cities of varying size- large or small. Inclusionary zoning provides a market-based tool that requires less public subsidies, which can help cities struggling to raise sufficient fiscal capital. The economic and workforce needs of those individuals needing affordable housing can be met by providing a decent place to live close to the areas where work is available. A lack of affordable housing in a central city can lead to more investment outside of the city limits, encouraging sprawl. Inclusionary zoning helps create affordable housing and develop mixed-use communities within the larger city context. Housing: Consortiums 12. Proscio, Tony. "Forming an Effective Supportive Housing Consortium" Commissioned by Corporation for Supportive Housing. 1996. www.csh.org/html/forming.pdf. Accessed January 2005. Manual on how to set up a 'supportive' housing consortium. Supportive housing being defined as housing that integrates services with permanent, independent affordable housing. The manual gives a detailed account of what a consortium does outline of who should participate, who the stakeholders are, who should convene, lead and even organize a consortium. Housing consortiums bring together funds to create affordable housing and services. They ensure that funds allocated/raised for a target population are used in the most appropriate combination of ways. This is done by ensuring that the projects are developed with the appropriate balance of concern for the physical quality of housing and the quality of services. In many cases services are needed to help affordable housing succeed and remain viable in the long term and the same can be said of services. However those who provide services vs. physical housing operate in very different ways, one in dollars and cents and the other in less quantitative ways. This can often cause confusion and mistrust between those involved. Consortiums create an environment 55 of shared understanding by allowing professionals from all areas to come together and share their concerns, needs and skills. By fostering communication and understanding the housing provider and service agency can come to a basic understanding that will allow them to work together effectively, creating the appropriate mix of services, and funding needed for a stable development in the long term. In the long run, after a project has been started the consortium is responsible for ensuring that the key players comply with the conditions and terms that the funds were raised under. They then seek to build public support for the project and ease opposition by helping the public and public officials understand the purpose and benefits of affordable housing with strong support services. 13. "Consolidated Plan for the City of Charlottesville and the Thomas Jefferson Home Consortium". 2003. http://www.tipdc.org/housing/consPlan HOME.asp. Accessed January 2005. The Thomas Jefferson HOME Consortium was formed in 1996 by six localities as a way to become eligible for HOME funds. Since that time they have been able to bring into the region over $8 million in HOME funds used to generate affordable housing in the region. The Thomas Jefferson Planning District administers the consortium. 15% of the total HOME funds that are reserved for the Community Housing Development Organization (CHDO) set aside, and are rotated through each of the participating governments. They equally share the remaining HOME funds. The City of Charlottesville is the lead agency fore the HOME consortium and the Thomas Jefferson Planning District. They also receive CDBG funds that may be allocated to participating governments. 14. "Asheville, North Carolina Consortium". U.S. Department of Housing and Urban Development. http://www . h ud. gov / 0 ffi ces/ cpd/ affordab I eho us i nglprogram s/home/- consortialashevilleconsortium.cfm. Accessed January 2005. The article points out that consortia are formed to become eligible for HOME funds and have a minimum commitment period of 3-years. The Lead Entity assumes responsibility for ensuring 56 compliance with HOME Program requirements. Therefore, participants need to be confident in the Lead Entities ability to fulfill their responsibility for the consortium to succeed. It goes on to outline the 8 factors that were important to building cooperation between members of the Asheville Regional Housing Consortium. Within the Asheville Regional area a total offourteen of the nineteen general local government units have joined the consortium and nine of the member governments are actively involved in producing affordable housing. 15. "City of Lenoir and Unifour Consortium "HOME" Program Receive National A ward". 1996. www.wpcog.dst.nc.us/homeconsort.htm. Accessed January 200S. The Unifour Consortium serves a four-county regional area of 318,419 people. The residential make up varies widely from highly developed to extremely rural. About 7S% of the programs funding goes to providing down payment assistant to first time home buyers. Eligible low to moderate income individuals can receive up to $S,OOO in the form of a 0% partially deferred loan to be used for closing costs and/or a down payment. In 1996 this program won one of 100 national Best Practices Awards given by HUD. They were praised for their 'outstanding and innovative use of HUD assistance to better serve families and communities. 16, Anderson, Arthur. Sherwood, Kay. "Connecticut Supportive Housing Demonstration Program Evaluation Report". Commissioned by Corporation for Supportive [lousing. 2002. Available at: www.CSH.org This project was begun in 1992 to address the needs of homeless and at risk populations. In the evaluation it was found that stable housing reduced the need for expensive health care, in those 126 Medicaid-eligible tenants who entered the housing and stayed for three years. These individuals were also able to increase their usage ofless expensive preventative and outpatient treatment. Those who had been in housing tor three years reported high levels of functionìng and a large majority became more independent and were able to perform the activities of daily level at an acceptable level. They had a high level of satisfaction with the housing and services. Their average income increased from $SOO to $639. Two-thirds of tenants were employed or in education and 57 training programs. Only one third of surveyed residents desired to stay in their building permanently, the rest sav,í it as a stepping stone to something beUer. All nine of the projects were financially stable and 7 were exceeding their original operating projections. The high occupancy rates and low turnover aids the property management team in keeping rental income steady. In the surrounding neighborhoods property values have increased for all but one of the nine projects. In three of the neighborhoods property values have tripled. The majority of neighbors have positive comments on the visual impact that the developments have had on the neighborhood. Funding is a combination of private and publ ic sources that are both one-time and ongoing. In some cases technical as well as financial assistance is pledged. The entities involved provided taxable bond financing, loans from some of the involved entities Trust Funds, low interests loans, the use of Ll/ITC, project-based rental subsidies. construction loans, and mortgages. The state funds on-site supportive services. 17. "Building IIOME: A HOME Program Primer" U.S. Department ofllousing and Urban Development. http://www.hud.gov/offjces/cpd/affordablehousing/library /bui Iding/chO ] . pdf. Accessed January 2005. The HOME program has 4 main objectives as outlined in their primer. To provide affordable housing to lower-income households, expand the capacity of nonprofit housing providers, strengthen state and local governments ability to provide housing while leveraging private-sector participation. In applying for HOME funds a local government or a participating jurisdiction (P J) agrees to supply a 25% match, coming from non-Federal sources. Consortia are often formed when a single local government does not meet the formula allocation or would not be able to raise the necessary match on their own. In this situation a group of contiguous units of governments can form consortium, pledging to work to alleviate housing problems within the state, normally for 3 years each. They form a "legally binding cooperation agreement between participation local governments which authorizes one local government to act as the lead agency as assume overall responsibly." 58 Once the consortium is formed the P1's have 24 months to find investors (developers, owners, contractors, sub recipients, state recipients, ect) to commit HOME funds. Of the total annual HOME allocation and moneys raised 10% can go to planning and administrative costs. And a yearly minimum of 15% of their total annual funds must go to Community Housing Development Organizations. HOME funds can be used to aid existing homeowners with repairs, rehabilitation and reconstruction. It can be used in homebuyer activities such as financing, rehabilitation and or new construction of homes for qualified homebuyers. The acquisition, rehabilitation, and construction of rental property, along with tenant-based rental assistance is also appropriate use of HOME funds. Movinl! to Opportunity (MTO) 18. United States Department of Housing and Urban Development Office of Policy Development and Research, "Moving to Opportunity for Fair Housing Demonstration Program: Interim Impacts Evaluation." September 2003. http://www.huduser.org/publications/fairhsg/mtoFinal.html. Accessed December 2004. Moving to Opportunity (MTO) is a IO-year demonstration program that tracked clients of housing authorities of five cities (Baltimore, Boston, Chicago, Los Angeles, and New York), authorized in Section 152 of the Housing and Community Development Act of 1992. After inviting cities to apply to participate in the program, it commenced in 1994. The program was inspired by the Gautreaux program in Chicago and was designed to measure the impacts of neighborhood and also as a randomized social experiment. After 1998, this report was published describing the impacts of the program roughly halfway through the program. Each participating family was randomly assigned to one of three groups: · Experiment Group - Offered vouchers that could only be used in census tracts with less than 10% of population poor. This group also received counseling and help finding units in qualifying areas. · Section 8 Group - Offered regular vouchers (not geographically restricted) and whatever else the program typically offered. 59 · Control Group - Continued receiving project-based assistance and received no vouchers. Within this relatively short timeframe, moving to lower poverty has had significant positive impacts on personal safety, housing quality, mental health, and obesity among adults; and mental health, staying in school, delinquency, and risky behavior among teenage girls. There are, however, apparently some negative effects on boys' behavior, and no statistically significant effects on employment outcomes for adults or educational achievement for children. Only marginal improvements were found in the quality of schools attended. 19. Feins, Judith D., Susan Popkin, and Debra McInnis. "Counseling in the Moving to Opportunity Demonstration Program." Accession #8784. Washington, D.C.: HUDUSER, 1997. Describes the counseling services provided by MTO, including both housing (credit counseling, assistance negotiating rent, finding a unit, budgeting, choosing a neighborhood, preparing to move) and non-housing related services both before and after the move Gob training and development, help finding ajob, education/literacy, family counseling, health care referrals, legal and welfare advocacy). There are four general guidelines for counseling, as listed in the Program Operations Manual (POM). They are: · Both individual and group counseling should be used as appropriate. · Counseling should focus on 'empowering' individuals and encouraging self-sufficiency. · Program budgets must be observed and adhered to. · Basic MTO guidelines can be adapted to fit local situations if approved by HUD. Things learned - · Assessment of needs for success should be done. · Contract between client and counselor helps define responsibilities. · It needs to be decided upfront what services will be includes, most importantly whether non- housing related services will be included. 60 · Both initial motivational support and follow-up support are necessary. 20. Pettit, Becky, and Sara McLanahan. "Social Dimension of Moving to Opportunity." Poverty Research News. January-February 200 I. This article looks at effect of MTO on social ties. Social ties, at any income level, have been shown to be important. How much does MTO disrupt these ties, and what are the consequences to social capital? The conclusions in this article are that while aggregate social capital in the experimental group seems to be increased, there are no increases in individual capital (except for children in Boston). One thing to keep in mind when examining this data is that the study periods are relatively short- term. Since relationships, and therefore social capital, take time to develop, these findings could change by the end of the demonstration project. Fair Share Housin2: 21. Mallach, Alan. "The Betrayal of Mount Laurel. Will New Jersey get away with gutting its landmark fair housing legislation?" Shelterforce Online. Issue #134. March/April 2004. The first Mount Laurel case from 1975 said that every town needed to provide low- or moderate- income housing. The municipalities chose not to act upon this obligation, leading to Mount Laurel II in 1983. This ruling resulted in firm targets for each town and village in the state. In towns that chose not to take steps to fulfill their obligation the court can step in and grant "builders remedies' to developers of affordable housing. These rulings lead to the Fair Housing Act in 1985 which created the Council on Affordable Housing (COAH) and the Regional Contribution Agreements (RCA). The COAH created the fair share allocation formula, assign each town and village their portion and update the apportionment every 6 years. The formula looks at fiscal capacity, wealth, employment trends and vacant land availability. They also review and approve each municipalities plan for implementing their fair share allocation. 61 Criticisms of the process are as follows. RCA allows a municipality to transfer 50% of its fair share allocation to a neighboring jurisdiction in exchange for money. COAH seemed unconcerned that the process failed to reach families below 40% of AMI. The methodology used to allocate the fair share was also highly criticized as being highly formulaic, complicated and arbitrary. The growth share method was suggested. This method says if you "grow you provide affordable housing in direct proportion to your growth." [fyou don't grow you are only responsible for meeting your existing affordable housing needs. The Coalition on Affordable Housing and Environment (CAHE) advocated that if this were applied in New Jersey for every "five housing units or five jobs added to a municipality, the municipality would have to provide one affordable housing unit. " 22. Dodge, Shannon. "Organize! Organizing the State on Your Side. Advocates help fulfill promise of California's fair share law" Shelterforce Online. Issue #121. January/February 2002. California mandates that all cities and counties have a general plan that includes a housing element. The housing element details how that municipality will fulfill the new housing requirements handed to them by their regional council of governments. The regional council decides how many units of new housing each jurisdiction is responsible for providing within four income categories from very low to above moderate. Each city and council does not need to build the units but they need to make steps to encourage affordable housing, have enough land zoned for multifamily that they could build all of the homes needed for lower-income families. 'Minimize obstacles that make development difficult such as density I imits, parking and even community opposition.' Along with this they must show how affordable housing funds will be used. The general plan and the subsequent housing element become the 'local constitution for land use and development. Once adopted, it has the force of law, and local governments cannot legally act inconsistently with its general plan." 23. Connerly, Charles. Marc Smith. "Developing a Fair Share Housing Policy for Florida" Journal of Land Use and Environmental Law. V 01.12: 1. Fall 1996. 62 Fair share housing policy may be one way we can enhance the mobility opportunities of poor inner city residents. Fair share programs determine where low- and moderate-income units should be built within a given area by looking at where it is most needed, where it will expand hosing opportunities and where it is most suitable. California's fare share is determined by existing and predicted demand for housing and by efforts to disperse low-income households. Each community is assigned their share of the regional need for affordable housing based on market demand, employment opportunities, commuting patterns, availability of suitable sites and public facilities. The state requires that each local government have their housing apportionment or housing element as part of their comprehensive plan. Their housing element covers how they plan to accommodate all of the state mandated low- to moderate income units. Ensures that housing will be built that will be affordable to all income brackets. Each locality need not provide these units; they need only have enough land zoned appropriately that the units could reasonably be constructed. Enforcement depends on the affordable housing advocates. They are expected to bring legal suit when an affordable development is unreasonably bared from an area or is faced with restrictions that would increase the costs to the point that it would no longer be affordable. New Jersey's fair share housing policy came about through Mount Laurel I and II. These cases lead to the creation of the Council on Affordable Housing (COAH). The COAH is responsible for identifying the housing regions, each region's need and then the amount of affordable housing each town and village is responsible for. In areas with developable land COAH says that new developments will have a minimum density of6 units per acre and that a maximum of20% of the units will be set-aside for very low- and low-income residents. New Jersey demonstrates that inclusionary zoning can be used exclusively to provide affordable units in an area where there is an active residential market. Massachusetts's application of fair share is also overseen by the state but it is much simpler than that of California and New Jersey. Their goal is to prevent localities from limiting the development of affordable housing arbitrarily, affordable housing being defined as any housing subsidized by the federal or state government under any program to assist the construction of low or moderate income housing. Any permit application that is denied by the local zoning board of appeals can go straight to a state Housing Appeals Committee. The committee is in place to ensure that the locality is not 63 arbitrarily limiting affordable housing be it through permit denials or conditions that would make the development uneconomic. Conditions must be consistent with the needs ofthe locality or they will be found to pose an unnecessary economic barrier to the development of affordable housing. If they find ether of these things to be the issue then the Committee can override the local zoning board of appeals decision. A locality that meets anyone of the following requirements and denies a permit is exempt from review by a Housing Appeals Committee. · 10% of dwelling units are low- and moderate-income units. Based on the last decennial census. · 1.5% or more of the towns residentially, commercial, or industrially zoned land is occupied by low- and moderate-income housing. · Approving the permit would result in the development site consisting of 0.3% of the towns pub I icly owned land or 10 acres being developed within one year, whichever is greater. Massachusetts fair share allocation is criticized for being overly simplified and somewhat arbitrary since it is not tied to need or growth. This method relies on developers to decide when and where it is feasible to develop affordable housing. Without developer driven initiatives affordable housing won't be constructed. This program does provide additional incentives for affordable housing in areas that qualify, such as: · State funds to low- moderate-income developments · Withholds state funds from jurisdictions that have a track record of discouraging affordable housing · Homeownership Opportunity Program for owner-occupied housing. While the Massachusetts program has been somewhat successful in deterring NIMBY, it hasn't lead to every jurisdiction having their fair share. Definin2 & Measurin2 Spatial Concentration 24. Greene, R. "Poverty Concentration Measures and the Urban Underclass." Economic Geography. Vol. 67: Issue 3. P.240-252. 1991 64 Adding to the literature on incorporating a spatial component to measures of segregation, Greene examines extreme poverty areas in 30 large cities using data from 1970 and 1980. This research measures the change and extent in the spatial distribution, size, and form of these areas in varying regions using spatial statistics. Arguing that the methodology previously used in poverty concentration measures, such as defining a concentration is any census tract above 20% (Jargowsky) or above 40% (U.S. Census) is not sufficient. Census tracts with high poverty rates are referenced to a geographic coordinate system so a spatial measure can be identified. The main argument is that the degree of isolation depends on the area in which concentration is estimated. With administrative units (e.g. census tracts) varying in size segregation measures do not accurately portray reality. 25. Iceland, 1., & Steinmetz, E. "The Effects of Using Census Block Groups Instead of Census Tracts When Examining Residential Housing Patterns." Working Paper. U.S. Census Bureau, Housing and Household Economic Statistics Division. U.S. Government Printing Office. 2003. Often times researchers choose Metropol itan Statistical Areas (MSA' s) to represent an approximation of housing markets in analysis, but researchers are given a choice when choosing a smaller unit for analyzing residential housing patterns. Census tracts are often used as the unit of analysis in segregation measurements. The main purpose of this paper is to analyze the difference in choosing block groups instead of census tracts in segregation research. Using census 2000 summary file 1 data, the authors compare housing patterns based on race and use 19 of 20 measures proposed by Massey and Denton. Results show that for 12 of the 19 measures, segregation measure results are slightly higher at the block group level than the census tract level, for all racial and ethnic groups. The measure that had the greatest degree of difference was the index of relative clustering. The absolute clustering and spatial proximity index showed greater differences at the block group level than the census tract level for African Americans and American Indians than for Hispanics and Asian/Pacific Islanders. 26. James, D.R., & Taeuber, K.E. "Measures of Segregation." Sociological Methodology. Vol. 15. P.l- 32. 1985. 65 James and Taeuber note that although there is much interest in the measurement of segregation no consensus has been reached as to how segregation should be measured. The authors also note that the reason for the disagreement is that no criteria exist to evaluate the various measures proposed. Since many measures have several interpretations, choosing which index to use incorporates arbitrariness into the study. The tendency to use a particular measure derives from the level of convenience and its current popularity in research circles. Principles are given to explain the concept of segregation and a comparison is conducted of the five measures of segregation using the criteria set forth. Using 10,000 pairs of school districts in 1979, the article concludes with an example of how each measure of segregation can be interpreted differently. 27. Johnston, R., & Voas, D., & Poulsen, M. "Measuring Spatial Concentration: The Use of Threshold Profiles." Environment and Planning B: Planning and Design. Vol. 30: Issue I. P. 3- 14. 2003. Arguing that geography must be taken into account rather than offering a single index number in segregation measurements, a new measurement of spatial concentration is set forth, the use of threshold profiles. The degree of concentration at various thresholds are calculated, producing and index with the end result being a profile. The purpose of the measurement is to go beyond map pattern, such unevenness of distribution as dissimilarity and Gini index propose, chloropleth mapping, and cluster analysis. These measures do not identify the degree of concentration and fail to distinguish between three types of concentration; concentrations within an area (usually using census divisions and administrative boundaries): concentration formed by contiguous areas; and a concentration formed by the proximity between areas. The authors note dissimilarity and segregation indices fail to ask the question "how spatially concentrated is the distribution of a target group within a larger population. This method takes into account spatial scale as a factor in the analysis. Previous segregation indices do not distinguish concentrations at various scales. The target group in the research is unemployed males in England and Wales in 1991. Results found that districts with high unemployment rates also were highly concentrated. Areas of low unemployment rates also found scattered patterns. This would not have been identified with a single number index. This article is worth noting because threshold profiles provide a clearer picture of concentration to direct place- based public policies appropriately. 28. Massey, D., & Denton, M. "The Dimensions of Residential Segregation." Social Forces, Vol. 67: Issue 2. P. 281-315.1988. 66 In their seminal study, Massey and Denton systematically evaluate 20 different indicators of residential segregation and categorize them according to five dimensions: evenness, exposure, concentration, clustering, and centralization. The indices are categorized using factor analysis and one index was chosen to represent each category. Massey and Denton recommend using the five indicators chosen as standards in future studies of residential segregation. In addition, this research is noted for providing a more in depth analysis of the type and distribution patterns of segregation than the dissimilarity index, a method often used in the 20 years prior to the study. 29. White, M.J. "Segregation and Diversity Measures In Population Distribution." Population Index. Vol. 52: Issue 2. P. 198-221. 1986. This article is an addition to current literature which identifies deficiencies in the commonly used dissimilarity index. A new statistic is offered which takes into account the spatial relationships of geographic parcels, something that is missing in the dissimilarity index. Recognizing that most segregation measures are based on the relative proportions of an attribute within the parcels of analysis the authors offer a statistic that will take into account the differences in cities with concentrated areas of poverty and those with multiple areas of residential clusters. The article also reviews the current measures and deficiencies, issues concerning the concepts in measuring segregation, properties of existing measures, and the deficiencies in the dissimilarity index. Using 1970 data a sample of 17 cities varying in minority population, size, and region were used. The analysis is conducted at the census tract level. This method used in this study can be noted for measuring the inter- and intra-group segregation of a population. 30. Wu, X.B., Sui, D.Z., "An Initial Exploration of a Lacunarity-based Segregation Measure." Environment and Planning B: Planning and Design. Vol. 28: Issue 3. P. 433 - 446.200 I. The modifiable aerial unit problem is placed within the context of segregation measures. Wu and Sui recognize that no segregation measures exist that take into account varying scale and most use single number, single scale measures that do not take into account various aggregations or zoning schemes. To fill this gap in the literature, the lucanarity-based approach is offered to measure segregation at various scales. The article reviews existing measures of segregation, identifies pros and cons, reviews the concept of lucanarity, and concludes with some examples using a GIS. The lucanarity-based approach is noted for not being sensitive to map boundaries but to scale only. Conceptually a "gliding box" is used to sample areas using common cell sizes instead of 67 administrative boundaries. The box size is changed and resampled to identity clusters at different scales. Complete desegregation occurs when the attribute studied is equal to the total proportion of the attribute in the entire study area. The technique is noted for its conceptual and technical ease and unlike other segregation measures can be computed by anyone familiar with ArcView Spatial Analysis. No knowledge of programming is necessary. 68 ApPENDIX F: REFERENCES Anderson, Arthur. Sherwood, Kay. 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"Building HOME: A HOME Program Primer" U.S. Department of Housing and Urban Development. http://www.hud.gov/oftìces/cpd/affordablehousing/I ibrary /bui Iding/chO 1.pdf. Accessed January 2005. Burchell and Galley. "Inclusionary Zoning: Pros and Cons." New Century Housing. Vol. 1: Issue 2. October 2000. The Center for Housing Policy. Cardwell, Diane. "City Sees Way to Get Mix of Homes on Brooklyn Waterfront." New York Times. Section B: p. 1 Dec. 27,2004. City of Iowa City Planning Economic Development Division, "2004 Community Profile for the Iowa City Area." http://www.icgov.org/documents/demoinfo.pdf. Accessed March 2005. 69 "City of Lenoir and Unifour Consortium "HOME" Program Receive National A ward". ] 996. www.wpcog.dst.nc.us/homeconsort.htm. Accessed January 2005. Connerly, Charles. Marc Smith. "Developing a Fair Share Housing Policy for Florida" Journal of Land Use and Environmental Law. Vo1.12:1. Fall ]996. "Consortia Builder, The" U.S. Department of Housing and Urban Development. http://www . h ud. gov / offi ces/ cpd/ affordab I eho us i ng/pro grams/h om e/ consortialbuil der/index. cfm. Accessed May 2005. Dodge, Shannon. "Organize! Organizing the State on Your Side. Advocates help fulfill promise of California's fair share law" Shelterforce Online. Issue #]21. January/February 2002. Dennis, Maryannd. Director, Greater Iowa City Housing Fellowship. Task Force Meeting, March 29, 2005. Feins, Judith D., Susan Popkin, and Debra Mcinnis. "Counseling in the Moving to Opportunity Demonstration Program." Accession #8784. Washington, D.C.: HUDUSER, ] 997. Goetz, Edward. "Clearing the Way: Deconcentrating the Poor in Urban America. Urban Institute Press. 2003. Greene, R. "Poverty Concentration Measures and the Urban Underclass." Economic 67: Issue 3. P.240-252. ] 99] Geography. Vol. Iceland, J., & Steinmetz, E. 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Environment and Planning B: Planning and Design. Vol. 28: Issue 3. P. 433 - 446.2001. 73