BALANCE SHEET BLOG – HOLLYWOOD, FL


Affordable Housing: 2006
March 6, 2006, 4:35 PM
Filed under: CRA Districts, Development, Neighborhoods

March 6, 2006

Last month, Neal Herst, Hollywood’s Director of Housing and Community Redevelopment, held a workshop on affordable housing for our city commission.  Also included were members of Hollywood’s Community Development Advisory Board and the Hollywood Housing Authority.

This was Affordable Housing 101 for our elected officials who on the whole did not seem well informed.  Mr. Herst made it clear that the term “affordable housing” does not refer to housing for poor people.  It is housing that our workforce can afford:  our teachers, nurses, librarians, and so forth.  The mayor lamented at length, not once but twice, that cities like Weston and Parklands have double and triple the median income of Hollywood and therefore the burden of creating affordable housing falls heavily on Hollywood while the wealthy cities get off virtually scot-free.

Mr. Herst maintained a positive can-do tone throughout.  He gave an excellent presentation that began with a definition of “affordable housing” (below), followed up with statistics to document the tremendous need for this type of housing in Hollywood.  He then presented eight possible strategies for solving the problem.

Affordable Housing

Housing is considered affordable when the monthly cost of rent plus utilities (or a mortgage plus taxes and insurance) is less than 30% of the household’s monthly gross income. This definition applies to households whose income falls below 120% of the area’s average median income. For a family of four, 120% of the median income is $72,000.  A household earning this amount could afford a $200,000 mortgage at current interest rates.

He noted that 59% of Hollywood’s tenants and 39% of Hollywood’s homeowners are paying more for housing that they can afford (cost burdened households).  These figures track almost exactly the numbers for Broward County as a whole (58% of renters, 38% of owners).

The workshop included data showing that median household income in Broward County has remained almost flat since 1993, while the cost of housing has risen sharply.

The range of possible solutions to our housing crisis presented by Mr. Herst include the following;

  • Incentivize new housing units
  • Land banking (community land trust)
  • Streamline the development process
  • Change development regulations
  • Maintain existing units
  • Develop new funding sources
  • Create a dedicated local funding source
  • Require inclusionary zoning

To date, with one exception that we know of, the city has incentivized market-rate but not affordable housing units. Its one venture into incentivizing affordable housing lies on Adams Street and the carrot being offered there is free land. Two developers are in the running to build this project (Gary Posner with Victory Housing or MG3 teamed up with Cynthia Berman Miller) but to the best of our knowledge, the selection process has not yet run its course.  Posner proposed initially to create 60 affordable townhouses, while MG3 offered a mix of affordable and market-rate townhouses on the site.

As for land banking, the city is in the process of bringing a community land trust into being through Henry Graham of LES, Inc. Mr. Graham’s organization is the sole organization in Hollywood that qualifies for certain federal funds as it is a recognized community housing development organization (CHODO). In addition, it has traditionally received economic development funding from the city’s share of CDBG funds.  As a result LES receives from the city some $200,000 or more annually.  Exactly how LES spends these funds was not discussed at the workshop, but it would be interesting to know. As the home of a land trust, LES will qualify for additional funding, though eventually the land trust should be self-sustaining.  The details of this project are yet to be finalized.

Streamlining the development process and changing development regulations to make it easier to build affordable housing could involve allowing greater density for affordable housing, granny flats, smaller lots, reduced or waived permit fees, for example.  These strategies were raised but not discussed in any detail at the workshop.

Maintenance of existing units was recognized as a problem.  For example, the affordable housing on Adams Street is to be built on land that formerly held deteriorated affordable housing, so there is little net increase in the number of units, though the quality will improve.  As the city is gentrified, affordable housing is lost to higher-cost dwellings. City commissioners seemed to understand the need to pay attention to maintaining and improving existing affordable units.

Mr. Herst presented the idea of creating an affordable housing trust as a dedicated source of funding to assist affordable housing projects.  Also so-called inclusionary zoning was discussed:  a market rate project that is required to include a percentage of affordable units.  They mayor was opposed to this approach because she felt those in the affordable units would not be able to keep up with the monthly maintenance fees as they increased over time.  She told of a senior citizen who lost his home under these circumstances.

With information presented at this workshop on the severe shortage of affordable housing in Hollywood, plus a range of strategies for mitigating the problem, the City Commission must now make some decisions about how to proceed.  If you have any ideas, you should let the City Commission know.

Comments Off on Affordable Housing: 2006





Comments are closed.