Budget busters: Finding the funding for affordable housing, schools

Councilors Wes Bellamy, Kathy Galvin, Heather Hill, and Nikuyah Walker have to figure out how to fund the city’s affordable housing goals. Staff photo Councilors Wes Bellamy, Kathy Galvin, Heather Hill, and Nikuyah Walker have to figure out how to fund the city’s affordable housing goals. Staff photo

By Melissa Moody

This is a story about numbers.

The number of families currently served by public housing and rental assistance vouchers: 826. The number of people on the waitlist for public housing or assistance: 1,866. The number of units Charlottesville needs to serve low-income residents: 3,975—or 20 percent of the city’s housing supply—in a city where 54 percent of the households qualify as low-income, very low-income, or extremely low-income.

And now there is a new number—$50 million.

That’s the amount of a bond the Charlottesville Low-Income Housing Coalition requested for affordable housing redevelopment and improvement that was discussed at a City Council capital improvement program budget work session September 6.

“At this point, housing for low-income residents within the city, outside of subsidized units, is pretty much non-existent,” said neighborhood planner Brian Haluska. “The rental vacancy rate in the city is 1.7 percent, while a healthy vacancy rate is around 5 percent.

“It’s hard to see a path forward using just market forces to provide additional housing for low-income residents.”

City Manager Mike Murphy and city staff briefed councilors on existing projects, unfunded improvements and new projects, and deferred maintenance for the city to be included in the CIP plan for the next five years. Increased funding for new affordable housing initiatives was a major focus of the session, as was expansion and modernization of city schools, both of which would cause substantial increases in the city’s budget over the next five years.

City staff briefed councilors on the current budget, including $131 million of debt that is paid by taxes and utility revenue, and the city’s policy of maintaining a 9 percent debt service to operating expense ratio, with a ceiling of 10 percent. According to staff, an increase in the city’s debt to fund new affordable housing initiatives would increase the debt service ratio or need to be backed by an increase in revenue streams.

But the issue also is a story about people and the repercussions of a history that echo across generations—from the work of enslaved people at the University of Virginia 200 years ago to the displacement and destruction of Vinegar Hill just 50 years in the past.

“Affordable housing is an issue of our city’s values,” said Elaine Poon, managing attorney of the Charlottesville office of the Legal Aid and Justice Center. “The city—the residents, the developers and those who need affordable housing—know that the history of systemic and institutional racism in Charlottesville and the country are directly linked to affordable housing needs today.”

The low-income housing coalition’s goals, aligned with those of the Public Housing Association of Residents, are that the city: prioritize extremely low-income housing; increase funding for the Redevelopment and Housing Authority, including issuing the first $50-million bond; earmark revenue for CRHA so that it has a stable source of income; increase funding for the Charlottesville Affordable Housing Fund to support nonprofit developers of affordable housing by at least four-fold; upzone areas of high opportunity for affordable housing; purchase and dedicate land for CRHA and nonprofit developers; and collaborate with major players in the area to develop workforce housing.

Murphy emphasized the need for council to prioritize projects to meet its goals—particularly in light of the fact that some of the goals exceed the current budget. Mayor Nikuyah Walker and councilors Wes Bellamy, Kathy Galvin, and Heather Hill agreed on the need to plan the budget strategically, to specifically address major projects like affordable housing and school modernization and expansion through more work sessions devoted to those topics in particular, and to bring in internal and external partners for input.

The cost to meaningfully address affordable housing redevelopment and maintenance and school expansion and modernization each exceed the current five-year CIP budget, Hill said. “Working with CRHA, Charlottesville City Schools, and other stakeholders to flesh out the actual costs and required timelines is critical to setting priorities.”

Community contributions to these conversations are also vital, according to council members.

Bellamy noted the importance of continuing discussions about how to fund affordable housing redevelopment and maintenance. “I think we at the very minimum, because of the history of our community and things that have transpired, we owe that much to our public housing residents.”

Council is planning to meet with housing representatives by late November. The budget discussions will continue across departments and come back to City Council in March 2019.

To watch a video of the September 6 budget work session, visit Charlottesville TV10.

Supply and demand

  • Public housing units: 376
  • City rental assistance vouchers: 450
  • People on the waitlist for public housing or assistance: 1,866
  • Years many of those people have been on waitlist: often more than eight
  • Units the city needs to serve low-income residents: 3,975—or 20 percent of the city’s housing supply
  • Percentage of Charlottesville households that qualify as low-income, very low-income, or extremely low-income: 54 percent

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